Matthews International Corporation · NASDAQ:MATW
Matthews International — Q2 2020 Earnings Presentation
16 slides from Matthews International's earnings presentation, May 8, 2020
Slide 1: Second Quarter Fiscal 2020 Earnings Teleconference
Second Quarter Fiscal 2020 Earnings Teleconference May 8, 2020 www.matw.com | Nasdaq: MATW Joseph C. Bartolacci President and Chief Executive Officer Steven F. Nicola Chief Financial Officer
Slide 2: Disclaimer
DISCLAIMER Any forward-looking statements contained in this presentation are included pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks and uncertainties that may cause the Company’s actua
Slide 3: Overview
Matthews Bie INTERNATIONAL® OVERVIEW
Slide 4: Q2 & YTD FY2020 Summary
Q2 & YTD FY2020 SUMMARY ($ in millions except per-share amounts) GAAP and non-GAAP Comparison Q2 Q2 2019 Q2 2020 Sales Sales $391.4 $374.8 • Higher sales in Industrial Technologies segment Gross Margin 34.8% 33.3% • Consistent sales in Memorialization Diluted E(L)PS $0.48 ($2.77) • Lower SGK Brand S
Slide 5: SGK Brand Solutions
SGK BRAND SOLUTIONS ($ in millions) Sales Q2 Sales YTD Sales $376.0 $347.7 • Lower sales in principal geographic markets $190.7 $172.9 • Commercial impact from COVID-19 • Lower sales in cylinders, surfaces, and engineered products • YTD impact of previously reported loss of US brand client • Unfavor
Slide 6: Memorialization
MEMORIALIZATION ($ in millions) Q2 Sales YTD Sales Sales $162.2 $161.8 $316.1 $316.2 • Higher cremation and incineration equipment sales • Improved price realization offset by lower unit volume • International memorial product sales unfavorably impacted by COVID-19 in Q2 Q2 FY2019 Q2 FY2020 FY2019 F
Slide 7: Industrial Technologies
INDUSTRIAL TECHNOLOGIES ($ in millions) Q2 Sales YTD Sales $73.6 $75.8 $40.1 Sales $38.6 • Higher product identification sales continue • Warehouse automation sales impacted by customer delays Adjusted EBITDA Q2 FY2019 Q2 FY2020 FY2019 FY2020 • Impact of higher sales • Lower product development expe
Slide 8: Capitalization and Cash Flows
CAPITALIZATION AND CASH FLOWS ($ in millions) Total Debt and Net Debt* $966.9 $965.8 $940.7 Cash $927.5 $72.3 $905.4 $893.5 $35.3 $39.4 9/30/2019 12/31/2019 3/31/2020 9/30/2019 12/31/2019 3/31/2020 Note: Darker shades on the left shows Total Debt. Operating Cash Flow • Operating cash flow increase d
Slide 9: Overview
‘ ges | g 4 ay Gam. ¥ “ y 4 e Aa bis Matthews (E@sitsss INTERNATIONAL® OVERVIEW
Slide 10: Business Update
BUSINESS UPDATE SGK BRAND • Varying impacts on the business units from Covid-19 • Slower cylinders and surfaces sales SOLUTIONS • Early benefits of cost improvement program • Stable quarter MEMORIALIZATION • Recent casket volume strong; cemetery products temporary low order rate due to stay at home
Slide 11: Outlook for Fiscal 2020
OUTLOOK FOR FISCAL 2020 Key Drivers • Challenges and uncertainty in current COVID-19 economic environment • Recent casket sales higher, memorial product sales deferred • SGK Brand Solutions packaging generally stable. Challenges in cylinders and surfaces • Industrial Technologies warehouse automatio
Slide 12: Supplemental Information
Matthews uzzeeveni INTERNATIONAL’ INFORMATION
Slide 13: Reconciliations of Non-GAAP Financial Measures
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES Included in this report are measures of financial performance that are not defined by generally accepted accounting principles in the United States (“GAAP”). The Company uses non-GAAP financial measures to assist in comparing its performance on a consis
Slide 14: Adjusted Net Income and Earnings Per Share Non-GAAP Reconciliation
ADJUSTED NET INCOME AND EARNINGS PER SHARE NON-GAAP RECONCILIATION (Unaudited) (In thousands, except per share data) Three Months Ended March 31, Six Months Ended March 31, 2020 2019 2020 2019 per share per share per share per share Net (loss) income attributable to Matthews $ (86,364) $ (2.77) $ 15
Slide 15: Adjusted EBITDA
ADJUSTED EBITDA (Unaudited) Three Months Ended March 31, Six Months Ended March 31, (InIn thousands) thousands 2020 2019 2020 2019 Net (loss) income $ (86,595) $ 15,194 $ (96,901) $ 18,178 Income tax (benefit) provision (11,066) (165) (16,463) 440 (Loss) income before income taxes (97,661) 15,029 (1
Slide 16: Net Debt Reconciliation
NET DEBT RECONCILIATION NON-GAAP RECONCILIATION (Unaudited) (In thousands) March 31, 2020 December 31, 2019 September 30, 2019 Long-term debt, current maturities $ 26,077 $ 25,532 $ 42,503 Long-term debt 939,753 941,395 898,194 Total debt 965,830 966,927 940,697 Less: Cash and cash equivalents 72,33
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