Jeld-wen Holding, Inc. · NYSE:JELD
Jeld-wen — Q3 2018 Earnings Presentation
23 slides from Jeld-wen's earnings presentation, Nov 6, 2018
Slide 1: Q3 2018 Results Presentation
\\intranet.barcapint.com\dfs-amer\group\Nyk\area\ibd\Industrial\Companies\Jeld-Wen\2015.07 Project Jamaica Dual Track\2015.10 IPO Execution\Presentation\Roadshow Presentation\Project Falcon_Roadshow Presentation_(1.13.17)_vNear Final_v10pm Q3 2018 Results Presentation | November 6, 2018 1 PRIVILEGED
Slide 2: Disclosures
Disclosures Forward-Looking Statements This presentation contains certain "forward-looking statements" regarding business strategies, market potential, future financial performance, the potential of our categories and brands, the estimated impact of tax reform on our results, litigation outcomes, ou
Slide 3: Introduction
Introduction Gary Michel, President and CEO 3
Slide 4: Introduction
Introduction Mixed Financial Results in Q3 2018: Q3 results in line with preliminary financials announced on October 15th Solid performance from recent acquisitions offset by flat core revenue growth Operating results impacted by lower than anticipated volumes and related productivity ineffici
Slide 5: Third Quarter Summary
Third Quarter Summary Q3 net revenues increased 14.7% YOY - Driven by 17% contribution from acquisitions, partially offset by (2%) foreign currency headwind - Core revenue growth was flat, as 2% benefit from pricing was offset by (2%) volume Q3 net income of $28.9 million, a decrease of $22.4 mi
Slide 6: Financial Review
Financial Review John Linker, Incoming CFO 6
Slide 7: Q3 and YTD 2018 Financial Summary
Q3 and YTD 2018 Financial Summary USD in millions (except for per share items) Q3 YTD 2018 YoY Change 2018 YoY Change Net Revenues $1,136.9 14.7% $3,255.6 16.8% Gross Margin $241.8 6.1% $696.4 8.7% Gross Margin Percent 21.3% (170 bps) 21.4% (160 bps) Net Income $28.9 (43.7%) $104.7 0.1% EPS – Dilute
Slide 8: Q3 and YTD 2018 Net Revenues Walk
Q3 and YTD 2018 Net Revenues Walk Q3 2018 JELD-WEN North America Europe Australasia Pricing 2% 3% 1% 0% Volume/Mix (2%) (3%) (1%) (1%) Core Growth 0% 0% 0% (1%) Acquisitions 17% 17% 13% 22% FX (2%) 0% (2%) (7%) Total 14.7% 16.8% 10.5% 14.0% YTD 2018 Pricing 2% 2% 1% 1% Volume/Mix (1%) (2%) 0% 1% Cor
Slide 9: North America Segment Performance
North America Segment Performance USD in millions Q3 - Total Q3 – Core Only (1) 2018 YoY Change YoY Change Net Revenues $668.2 16.8% 0% Adjusted EBITDA $84.1 2.0% (7%) Adjusted EBITDA Margin 12.6% (180 bps) (100 bps) YTD - Total YTD – Core Only (1) 2018 YoY Change YoY Change Net Revenues $1,839.3 14
Slide 10: Europe Segment Performance
Europe Segment Performance USD in millions Q3 - Total Q3 – Core Only (1) 2018 YoY Change YoY Change Net Revenues $292.9 10.5% 0% Adjusted EBITDA $28.1 (15.7%) (20%) Adjusted EBITDA Margin 9.6% (300 bps) (250 bps) YTD - Total YTD – Core Only (1) 2018 YoY Change YoY Change Net Revenues $913.3 19.2% 1%
Slide 11: Australasia Segment Performance
Australasia Segment Performance USD in millions Q3 - Total Q3 – Core Only (1) 2018 YoY Change YoY Change Net Revenues $175.9 14.0% (1%) Adjusted EBITDA $26.3 14.7% 3% Adjusted EBITDA Margin 14.9% 10 bps 50 bps YTD - Total YTD – Core Only (1) 2018 YoY Change YoY Change Net Revenues $503.0 21.5% 2% Ad
Slide 12: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow USD in millions Balance Sheet and Liquidity September 29, 2018 December 31, 2017 Total Debt $1,532.4 $1,273.7 Cash $151.4 $220.2 Total Net Debt $1,381.0 $1,053.5 Net Debt / Adjusted EBITDA 3.0x 2.4x Liquidity (1) $354.5 $512.2 Cash Flow Q3 YTD 2018 Q3 YTD 2017 Cash Flow F
Slide 13: 2018 Outlook and Long-term Margin Improvement
2018 Outlook and Long-term Margin Improvement 13
Slide 14: 2018 Outlook
2018 Outlook USD in millions Q 4 2018 O utlook 2017 Q 4 Actual 2018 Q 4 O utlook Adjusted EBITDA $103.1 $99.0 to $114.0 Full Y ear 2018 O utlook Prior 2018 FY Outlook from August ( 1 ) 2018 FY Updated Outlook ( 2 ) Net Revenue Growth 16.0% to 18.0% 15.0% to 17.0% Adjusted EBITDA $500 to $520 $455 to
Slide 15: Manufacturing Cost Structure Exceeds Peer Group Median
Manufacturing Cost Structure Exceeds Peer Group Median Revenue ($ in billions) Adj. EBITDA Margins $1.5B (500 bps) $4.2 15.8% $2.7 10.8% JELD-WEN Peer Group Median JELD-WEN Peer Group Median SG&A as % of Revenue (1) Adj. EBITDA per Employee ($ in thousands) (170 bps) ($30K) 15.5% 17.2% $52 $22 JELD-
Slide 16: Path to Margin Target on Current Volumes
Path to Margin Target on Current Volumes Assumes no revenue growth from volume/mix required to achieve margin target, however additional revenue from pricing is assumed to offset inflation. 15% + Cost Productivity Through JEM • $100M+ savings Global Footprint opportunity 10.6% Consolidation Plan • R
Slide 17: Global Footprint Consolidation
Global Footprint Consolidation Strategic Overview Leverage Acquired • Reduction in structural costs and overhead Manufacturing Assets For • Improve freight routes and lead times Footprint Consolidation • Vertical integration for cost benefits • Improve health and safety • Reduces complexity • Increa
Slide 18: Global Footprint Consolidation
Global Footprint Consolidation Financial Profile (USD in millions) Overview Timing of Savings • Reduce global footprint to improve cost structure and service levels $25 • Multiple projects will be launched over the next 3 years utilizing a standardized approach $75 • Estimated annualized cost saving
Slide 19: Cost Productivity Through JEM
Cost Productivity Through JEM Culture and Tools Result • Problem solving (A3) • Productivity and capacity • Standard work • Employee engagement • Visual management • Improved safety • Value streams • Higher quality • Goal deployment • Improved service levels • Demand and labor planning • Increased m
Slide 20: Summary
Summary Successful leadership transition underway; no change to strategy or long-term targets Continue to improve customer service, delivery, and quality to drive core growth Focus on cost out: productivity, overhead reduction, footprint optimization Offset inflation and tariffs with discipl
Slide 21: Appendix
Appendix 21
Slide 22: Non-GAAP Reconciliation
Non-GAAP Reconciliation Adjusted EBITDA (USD in millions) Three Months Ended Nine Months Ended September 29, September 30, September 29, September 30, 2018 2017 2018 2017 Net income $ 28.9 $ 51.3 $ 104.6 $ 104.5 Equity earnings of non-consolidated entities — (1.1) (0.7) (2.6) Income tax (benefit) ex
Slide 23: Non-GAAP Reconciliation
Non-GAAP Reconciliation Adjusted EPS & Free Cash Flow (USD in millions) Three Months Ended Nine Months Ended September September September September (amounts in millions, except share and per share 29, 30, 29, 30, data) 2018 2017 2018 2017 Net income attributable to common shareholders $ 28.9 $ 51.3