H. B. Fuller Company · NYSE:FUL
H. B. Fuller — Q4 2019 Earnings Presentation
23 slides from H. B. Fuller's earnings presentation, Jan 23, 2020
Slide 1: Fourth Quarter 2019 Conference Call
Fourth Quarter 2019 Conference Call Investor Presentation St. Paul, MN January 23, 2020
Slide 2: Safe Harbor & Regulation G
2 Safe Harbor & Regulation G Safe Harbor Statement Certain matters discussed today may include 'forward looking statements' as that term is defined under the Private Securities Litigation Reform Act of 1995. Since such statements reflect our current expectations, actual results may differ as they ar
Slide 3: Q4'19 Quarterly Results
3 Q4’19 Quarterly Results Highlights FY 2019 Imperatives • Share gains in strategic segments amidst continued slow industrial production ✓ EBITDA • Adj EPS & EBITDA up YoY @ constant • Sequential improvement in Q4’19 currency FUL volume trends vs. Q3’19 • Share gains in strategic markets • Increased
Slide 4: Q4 2019 Segment Summary
4 Q4Better 2019 Segment Summary accountability Stronger teamwork Global vision Americas Adhesives • Organic sales growth +3% year-over-year against significantly lower US PMI • Growth driven by increased volume; now annualized against 2018 pricing actions • Improving volume trends sequentially vs. Q
Slide 5: Completed Realignment to Three GBUs
5 Completed Realignment to Three GBUs Estimated FY19 Revenue Benefits Hygiene, Health • Enhances strategic alignment of and Consumables business strategies Adhesives 45% • Accelerates global coordination across Engineering Adhesives regions and end markets 40% • Simplifies business and reduces costs
Slide 6: Q4 2019 Key Financial Results Summary
6 Q4 2019 Key Financial Results Summary • Net Revenue down 3.8% year-over-year; organic sales down 0.9% • Adjusted gross margin of 27.6% down 20 bps YOY • Adjusted SG&A approximately flat YoY • Adjusted EPS of $0.88; up ~4% YoY excluding FX and divestiture • Adjusted EBITDA of $112M; EBITDA margin f
Slide 7: FY 2020 Guidance
7 FY 2020 Guidance FY’20 Guidance Net Revenue Flat to +1% YoY Organic Growth 1% to 2% FX impact -0.5% approximately Divestiture -0.5% approximately Adjusted EPS $3.15 to $3.35 Adjusted EBITDA $440M to $460M Debt paydown $200M Key Guidance Assumptions: • Loss of $5M EBITDA and $0.05 adjusted EPS in F
Slide 8: Wrap-Up
6 Wrap-Up • Margin and cash flow resilience amidst challenging external conditions • Winning new customer business in highly engineered applications • Expect 2020 macroeconomic environment to be similar to 2019 • Business realignment drives cost savings and organic growth • Company actions support s
Slide 9: H.B. Fuller
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Slide 10: Appendix
APPENDIX Q4 2019 Investor Presentation
Slide 11: Regulation G – EPS & EBITDA Reconciliation
9 Regulation G – EPS & EBITDA Reconciliation 13 Weeks Ended 52 Weeks Ended November 30, 2019 December 1, 2018 November 30, 2019 December 1, 2018 Net income attributable to H.B. Fuller $ 32,214 $ 41,345 $ 130,817 $ 171,208 Adjustments: Acquisition project costs 45 616 2,204 2,833 Tonsan call option a
Slide 12: Regulation G – Q4 Segment Information
10 Regulation G – Q4 Segment Information 13 Weeks Ended 13 Weeks Ended November 30, 2019 December 1, 2018 Net Revenue: Americas Adhesives $ 261,366 $ 265,434 EIMEA 164,669 174,790 Asia Pacific 71,476 71,172 Construction Adhesives 93,294 106,921 Engineering Adhesives 148,301 150,112 Total H.B. Fuller
Slide 13: Regulation G – Full Year Segment Information
11 Regulation G – Full Year Segment Information 52 Weeks Ended 52 Weeks Ended November 30, 2019 December 1, 2018 Net Revenue: Americas Adhesives $ 1,022,775 $ 1,051,365 EIMEA 640,913 697,448 Asia Pacific 271,585 278,162 Construction Adhesives 394,912 452,046 Engineering Adhesives 566,815 561,981 Tot
Slide 14: Regulation G – Adjusted Income Reconciliation
12 Regulation G – Adjusted Income Reconciliation 13 Weeks Ended 52 Weeks Ended November 30, 2019 December 1, 2018 November 30, 2019 December 1, 2018 Income before income taxes and income from equity method investments $ 40,580 $ 42,863 $ 172,828 $ 156,726 Adjustments: Acquisition project costs 63 84
Slide 15: Regulation G – Adjusted Income Tax Reconciliation
13 Regulation G – Adjusted Income Tax Reconciliation 13 Weeks Ended 52 Weeks Ended November 30, 2019 December 1, 2018 November 30, 2019 December 1, 2018 Income Taxes $ (10,506) $ (3,488) $ (49,408) $ 6,356 Adjustments: Acquisition project costs (17) (232) (500) (1,124) Tonsan call option agreement -
Slide 16: Regulation G – Adjusted Gross Margin Reconciliation
14 Regulation G – Adjusted Gross Margin Reconciliation 13 Weeks Ended 52 Weeks Ended November 30, 2019 December 1, 2018 November 30, 2019 December 1, 2018 Net revenue 739,106 768,429 2,897,000 3,041,002 Gross profit $ 201,217 $ 207,429 $ 806,922 $ 828,158 Gross profit margin 27.2% 27.0% 27.9% 27.2%
Slide 17: Regulation G – Adjusted SG&A Reconciliation
15 Regulation G – Adjusted SG&A Reconciliation 13 Weeks Ended 52 Weeks Ended November 30, 2019 December 1, 2018 November 30, 2019 December 1, 2018 Selling, general and administrative expenses $ (148,521) $ (142,932) $ (580,928) $ (590,267) Adjustments: Acquisition project costs 63 323 2,703 1,437 To
Slide 18: Regulation G – Q4'19 Segment EBITDA Reconciliation
16 Regulation G – Q4’19 Segment EBITDA Reconciliation Americas Asia Construction Engineering Corporate H.B. Fuller Adhesives EIMEA Pacific Adhesives Adhesives Total Unallocated Consolidated 13 Weeks Ended November 30, 2019 $ 23,703 $ 4,352 $ 6,555 $ 1,536 $ 19,908 $ 56,054 $ (23,840) $ 32,214 Net in
Slide 19: Regulation G – FY'19 Segment EBITDA Reconciliation
17 Regulation G – FY’19 Segment EBITDA Reconciliation Americas Asia Construction Engineering Corporate H.B. Fuller Adhesives EIMEA Pacific Adhesives Adhesives Total Unallocated Consolidated 52 Weeks Ended November 30, 2019 $ 100,101 $ 24,752 $ 22,328 $ 14,741 $ 77,734 $ 239,656 $ (108,839) $ 130,817
Slide 20: Regulation G – Q4'18 Segment EBITDA Reconciliation
18 Regulation G – Q4’18 Segment EBITDA Reconciliation Americas Asia Construction Engineering H.B. Fuller Adhesives EIMEA Pacific Adhesives Adhesives Total Unallocated Consolidated 13 Weeks Ended December 1, 2018 $ 28,576 $ 8,153 $ 6,945 $ 7,015 $ 19,067 $ 69,756 $ (28,411) $ 41,345 Net income attrib
Slide 21: Regulation G – FY'18 Segment EBITDA Reconciliation
19 Regulation G – FY’18 Segment EBITDA Reconciliation Americas Asia Construction Engineering H.B. Fuller Adhesives EIMEA Pacific Adhesives Adhesives Total Unallocated Consolidated 52 Weeks Ended December 1, 2018 $ 106,955 $ 33,742 $ 18,063 $ 33,908 $ 62,094 $ 254,762 $ (83,554) $ 171,208 Net income
Slide 22: Revenue Performance Components
20 Revenue Performance Components 13 Weeks Ended 52 Weeks Ended November 30, 2019 November 30, 2019 Total Total Price (0.5%) 1.0% Volume (0.4%) (2.1%) Organic Growth (Decline) (0.9%) (1.1%) M&A (0.8%) (0.3%) F/X (2.1%) (3.3%) Total H.B. Fuller Net Revenue Decline (3.8%) (4.7%) 13 Weeks Ended 52 Week
Slide 23: Investor contact
21 Investor contact: Vice President, Investor Relations H.B. Fuller Barbara Doyle (651) 236-5023 Q4 2019 Investor Presentation