Siteone Landscape Supply, Inc. · NYSE:SITE
Siteone Landscape Supply — Q2 2023 Earnings Presentation
21 slides from Siteone Landscape Supply's earnings presentation, 2023
Slide 1: Second Quarter 2023 Earnings
Second Quarter 2023 Earnings
Slide 2: Disclaimer
Disclaimer Forw ard-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forw ard-looking statements may include, but are not limited to, statements relating to our 2022 Adjusted EBITDA outlook and our
Slide 3: Conference call agenda
Conference call agenda Introduction John Guthrie, CFO Business Update Doug Black, Chairman and CEO Financial Update John Guthrie, CFO Development Update Scott Salmon, EVP Strategy & Development Closing & Outlook Doug Black, Chairman and CEO Q&A 3
Slide 4: Company and industry overview
Company and industry overview ■ Largest and only national full product line wholesale distributor of landscape supplies ■ $25 billion highly fragmented market(1) ■ More than four times the size of next competitor and only ~16% market share(1) ■ Serving residential and commercial landscape profession
Slide 5: SiteOne is built for continued growth and margin enhancement
SiteOne is built for continued growth and margin enhancement Current strategy ✓ Leverage strengths of both large and local company ■ Fully exploit our scale, resources and capabilities ■ Execute local market growth strategies ■ Deliver superior value to our customers and suppliers ■ Close and integr
Slide 6: Track record of performance and growth
Track record of performance and growth Net Sales Adjusted EBITDA ($ in Millions) ($ in Millions) $464 $4,015 ’16-’22 $415 $3,476 ’16-’22 Growth Growth $2,705 35.4% $2,358 34.9% Sales $ $260 Adj. EBITDA $ $2,112 11.9% $1,862 33.3% +144% $201 11.6% +246% $1,648 $176 32.8% $157 GM % $134 32.0% 32.1% 9.
Slide 7: Significant room to grow across product lines
Significant room to grow across product lines # of markets (1) Missing either Missing both Full Product No Hardscapes or Hardscapes Line Offering Presence Nursery and Nursery SiteOne offers all ~55 product lines in only ~21% of our target markets today… ~70 ~65 ~50 (1) Target markets as of Q4 2022 a
Slide 8: Second Quarter 2023 highlights and recent developments
Second Quarter 2023 highlights and recent developments Second Quarter 2023 highlights (compared to Second Quarter 2022): ✓ Net sales increased 11% to $1.35 billion ✓ Organic Daily Sales increased 4% ✓ Gross profit increased 6% to $489.4 million; gross margin contracted 170 basis points to 36.2% ✓ SG
Slide 9: Review of Second Quarter 2023 financial results
Review of Second Quarter 2023 financial results Summary financials Financial highlights (compared to prior-year period) (in millions) ■ Net sales increased 11% YoY to $1.35 Billion – Organic Daily Sales increased 4% $1,353.7 Net sales – Acquired sales growth was $86.1 million, contributing 7% to the
Slide 10: Balance sheet & cash flow highlights
Balance sheet & cash flow highlights For the quarter ended July 2, 2023 Balance sheet & cash flow highlights (compared to prior-year period) (in millions) ■ Working capital increased to $903.1 million, compared to $885.1 million – Increase reflects change in receivables supporting sales growth Worki
Slide 11: Proven track record of successful acquisitions
Proven track record of successful acquisitions 2014-2018 2019 2020 2021 2022 2023 Total ▪ Cutting Edge ▪ Wittkopf Landscape ▪ Lucky Landscape ▪ JK Enterprise ▪ J&J Materials Supplies ▪ All Pro Horticulture ▪ Arizona Stone & ▪ BellStone Masonry ▪ Triangle Landscape ▪ Empire Supplies Solstice Supplies
Slide 12: M&A continues to add significant value: Adams Wholesale Supply
M&A continues to add significant value Adams Wholesale Supply ✓Closed on May 8th ✓Extends our agronomics and landscape supplies presence in three fast-growing Texas markets ✓Purchasing synergies ✓Cross-selling synergies SiteOne Adams Source: Company data 12
Slide 13: M&A continues to add significant value: Link Outdoor Lighting
M&A continues to add significant value Link Outdoor Lighting ✓Closed on May 26th ✓Extends our leading SiteOne landscape lighting Link presence in FL, TN, and TX ✓Purchasing synergies ✓Cross-selling synergies Source: Company data 13
Slide 14: M&A continues to add significant value: Hickory Hill Farm & Garden
M&A continues to add significant value Hickory Hill Farm & Garden SiteOne ✓Closed on July 3rd Hickory Hill ✓Expands our leading irrigation, nursery, and landscape supplies presence in the Lake Oconee area ✓Cross-selling synergies ✓Purchasing synergies Source: Company data 14
Slide 15: Robust pipeline provides significant growth opportunity
Robust pipeline provides significant growth opportunity ✓ SiteOne is the leading industry consolidator 16% ✓ Significant sourcing advantage with 80+ associates scouting new growth opportunities 84% ✓ Our pipeline is deep and expanding ~$25bn market(1) ✓ Experienced M&A team driving strong acquisitio
Slide 16: 2023 Outlook
2023 Outlook ✓ End market demand expected to remain resilient with weakness in new residential construction partially offset by modest growth in other end markets ✓ Key commercial and operational initiatives expected to support market share gains ✓ Organic Daily Sales growth expected to be approxima
Slide 17: Investment highlights
Investment highlights Uniquely Clear market leader attractive industry Compelling and Proven management sustainable team growth strategy Operational and Value-creating commercial acquisitions excellence 17
Slide 18: Appendix
Appendix Non-GAAP Reconciliations
Slide 19: Non-GAAP reconciliations
Non-GAAP reconciliations Adjusted EBITDA Reconciliation 2023 2022 2021 ($ in millions) Q2’23 Q1’23 Q4’22 Q3’22 Q2’22 Q1’22 Q4’21 Q3’21 Reported Net income (loss) $124.0 $(4.5) $(0.9) $73.3 $140.7 $32.3 $27.5 $80.0 Income tax (benefit) expense 40.0 (2.7) (4.6) 22.9 44.8 4.6 2.7 19.1 Interest expense,
Slide 20: Non-GAAP reconciliations
Non-GAAP reconciliations Adjusted EBITDA Reconciliation ($ in millions) 2022 2021 2020 2019 2018 2017 2016 Reported Net income $245.4 $238.4 $121.3 $77.7 $73.9 $54.6 $30.6 Income tax expense 67.7 56.1 27.5 13.8 1.3 18.0 21.3 Interest expense, net 20.0 19.2 31.0 33.4 32.1 25.2 22.1 Depreciation & amo
Slide 21: Non-GAAP reconciliations
Non-GAAP reconciliations 2023 Organic Daily Sales Reconciliation 2023 2022 ($ in millions) FY’23 Q4’23 Q3’23 Q2’23 Q1’23 FY’22 Q4’22 Q3’22 Q2’22 Q1’22 Reported Net Sales -- -- -- $1,353.7 $837.4 $4,014.5 $890.0 $1,102.6 $1,216.6 $805.3 A Organic Sales -- -- -- $1,252.4 $777.6 $3,929.3 $857.0 $1,068.
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