Mueller Water Products · NYSE:MWA
Mueller Water Products — Q4 2020 Earnings Presentation
26 slides from Mueller Water Products's earnings presentation, Nov 10, 2020
Slide 1: Where Intelligence Meets Infrastructure
Where Intelligence Meets Infrastructure® Earnings Conference Call For The Fourth Quarter and Year Ended September 30, 2020 November 10, 2020 These slides are not intended to be a stand-alone presentation, but are for use in conjunction with the earnings call
Slide 2: Non-GAAP Financial Measures
NON-GAAP Financial Measures In an effort to provide investors with additional information regarding the Company’s results as determined under GAAP, the Company also provides non-GAAP information that management believes is useful to investors. These non-GAAP measures have limitations as analytical t
Slide 3: Forward-Looking Statements
Forward-Looking Statements This presentation contains certain statements that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements that address activities, events or developments that the Company intends, expects, plans
Slide 4: Fourth Quarter Highlights
Fourth Quarter Highlights • Employees continue to execute in an extremely challenging environment resulting from the ongoing pandemic Key Takeaways − Continue to improve procedures to ensure high customer service levels and keep our employees safe and • Finished 2020 better healthy than expected, −
Slide 5: Consolidated GAAP Results
Consolidated GAAP Results • Net sales of $265.3M decreased $1.6M, or 0.6%, primarily due to reduced shipment volumes related to the pandemic impacting Technologies, partially offset by increased volumes and higher pricing Fourth Quarter 2020 2019 at Infrastructure • $36.8M sequential increase in net
Slide 6: Consolidated Non-GAAP Results
Consolidated Non-GAAP Results • Adjusted operating income of $41.8M improved $13.2M sequentially, and decreased $0.8M, or 1.9%, Fourth Quarter 2020 2019 as compared with $42.6M in the prior year quarter Adj. operating income $ 41.8 $ 42.6 • Decrease primarily due to lower shipment volumes at Technol
Slide 7: Infrastructure Results
Infrastructure Results • Net sales of $242.5M increased 15.5% sequentially and increased 3.3% compared with Fourth Quarter 2020 2019 the prior year Net sales $ 242.5 $ 234.7 • Increase primarily due to increased shipment volumes and higher pricing Adj. operating income $ 57.0 $ 51.2 • Adjusted opera
Slide 8: Technologies Results
Technologies Results • Net sales of $22.8M increased 22.6% sequentially and decreased 29.2% compared with Fourth Quarter 2020 2019 the prior year Net sales $ 22.8 $ 32.2 • Primarily due to lower volumes related to the pandemic, which continues to impact the timing of some leak Adj. operating income
Slide 9: Free Cash Flow
Free Cash Flow $160.0 • Net cash provided by operating activities for fiscal $140.3 $140.0 year ended September 30, 2020 improved $67.7 $47.8M to $140.3M, primarily driven by $120.0 improvements in inventory management $92.5 $100.0 • Q1FY20 included the payment associated with the $ in millions $80.
Slide 10: Strong Balance Sheet and Ample Liquidity
Strong Balance Sheet and Ample Liquidity Well-Prepared to Deal with Ongoing Challenges from Pandemic • Moody’s: Ba2 Corporate Rating, Ba3 Notes Rating, Stable Outlook Debt Maturities Credit Rating • S&P: BB Corporate and Notes Ratings, Stable Outlook $500 • $450M of 5.5% Senior Unsecured Notes (matu
Slide 11: End Markets, Key Strategies and Full-Year 2021 Outlook
End Markets, Key Strategies and Full-Year 2021 Outlook
Slide 12: End Market Update
End Market Update • Customers increased their level of activity from the third quarter, prioritizing critical network maintenance and existing infrastructure projects Key Takeaways • Level of repair and replacement and project activity continues to vary significantly across • Overall, end markets th
Slide 13: Continue to Make Progress on Key Strategies to Strengthen and Grow the Business
Continue to Make Progress on Key Strategies to Strengthen and Grow the Business 13
Slide 14: Modernizing Manufacturing Facilities
Modernizing Manufacturing Facilities • Three transformational projects account for approximately $130M of capital spending and expected to drive approximately $30M of annualized incremental gross profit through combination of efficiencies and sales growth, after all are completed − Modernizing facil
Slide 15: Full-Year 2021 Outlook
Full-Year 2021 Outlook* • Believe continued strong growth in the residential construction end market will help offset any challenges in the project-related areas of our business Capital Allocation • Expectations also take into account our current backlog, new product initiatives and channel • Strong
Slide 16: Sustainability
Sustainability • Recognize the important role we play in ensuring water is delivered more safely and efficiently than ever before • Mueller Water Products has had a robust Environmental, Health & Safety program for many years • Safety and environmental stewardship are top priorities and are included
Slide 17: Q&A
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Slide 18: Supplemental Data
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Slide 19: Segment Results and Reconciliation of Non-GAAP to GAAP Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Quarter ended September 30, 2020 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales $ 242.5 $ 22.8 $ — $ 265.3 Gross profit $ 90.5 $ 3.4 $ — $ 93.9 Sellin
Slide 20: Segment Results and Reconciliation of Non-GAAP to GAAP Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Quarter ended September 30, 2020 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 26.7 Income tax expense (1) 8.8 Interest expense, net (1) 6.0 Pensi
Slide 21: Segment Results and Reconciliation of Non-GAAP to GAAP Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Quarter ended September 30, 2019 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales $ 234.7 $ 32.2 $ — $ 266.9 Gross profit $ 81.5 $ 7.3 $ — $ 88.8 Sellin
Slide 22: Segment Results and Reconciliation of Non-GAAP to GAAP Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Quarter ended September 30, 2019 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 40.2 Income tax expense (1) 11.4 Interest expense, net (1) 4.2 Walt
Slide 23: Segment Results and Reconciliation of Non-GAAP to GAAP Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Year ended September 30, 2020 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales $ 885.5 $ 78.6 $ — $ 964.1 Gross profit $ 316.4 $ 11.8 $ — $ 328.2 Sellin
Slide 24: Segment Results and Reconciliation of Non-GAAP to GAAP Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Year ended September 30, 2020 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 72.0 Income tax expense (1) 22.1 Interest expense, net (1) 25.5 Walter
Slide 25: Segment Results and Reconciliation of Non-GAAP to GAAP Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Year ended September 30, 2019 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales $ 871.0 $ 97.0 $ — $ 968.0 Gross profit $ 302.9 $ 18.0 $ — $ 320.9 Sellin
Slide 26: Segment Results and Reconciliation of Non-GAAP to GAAP Measures
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (UNAUDITED) Year ended September 30, 2019 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 63.8 Income tax benefit (1) 18.3 Interest expense, net (1) 19.8 Walter
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