Msc Industrial Direct Company, Inc. · NYSE:MSM
Msc Industrial Direct — Q4 2021 Earnings Presentation
24 slides from Msc Industrial Direct's earnings presentation, Oct 20, 2021
Slide 1: Fiscal Fourth Quarter and Full Year 2021 Earnings Presentation
Fiscal Fourth Quarter and Full Year 2021 Earnings Presentation OCTOBER 20, 2021
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements Statements in this presentation may constitute "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, that address activities, events or developments that
Slide 3: Fiscal Fourth Quarter 2021 Overview
Fiscal Fourth Quarter 2021 Overview Growth initiatives and macro environment drove double-digit sales growth Solid underlying gross margins reflected strong execution on price realization and purchase cost performance in robust inflationary environment Achieve full year fiscal 2021 Mission Critical*
Slide 4: Fiscal Fourth Quarter 2021 Reported Results
Fiscal Fourth Quarter 2021 Reported Results Net Sales Gross Profit Operating Profit Earnings (millions) (millions and % of sales) (millions and % of sales) (per diluted share) $831.0 $91.2 $349.0 $747.7 $1.18 $311.1 $72.9 $0.94 41.6% 42.0% 9.8% 11.0% Q4 2020 Q4 2021 Q4 2020 Q4 2021 Q4 2020 Q4 2021 Q
Slide 5: Fiscal Fourth Quarter 2021 Adjusted Results
Fiscal Fourth Quarter 2021 Adjusted Results* Net Sales Gross Profit Adj. Operating Profit Adj. Earnings (millions) (millions and % of sales) (millions and % of sales) (per diluted share) $831.0 $1.26 $349.0 $747.7 $311.1 $96.9 $1.09 $84.1 41.6% 42.0% 11.2% 11.7% Q4 2020 Q4 2021 Q4 2020 Q4 2021 Q4 20
Slide 6: Fiscal Year 2021 Reported Results
Fiscal Year 2021 Reported Results Net Sales Gross Profit Operating Profit Earnings (millions) (millions and % of sales) (millions and % of sales) (per diluted share) $3,192.4 $3,243.2 $1,34 $350. $4.51 $1,33 3.3 7 3.5 $301. $3.87 8 42.1% 11.0% 41.1% 11.0% 9.3% FY 2020 FY 2021 FY 2020 FY 2021 FY 2020
Slide 7: Fiscal Year 2021 Adjusted Results
Fiscal Year 2021 Adjusted Results* Net Sales Adjusted Gross Profit Adjusted Operating Adjusted Earnings (millions) (millions and % of sales) Profit (per diluted share) $3,24 (millions and % of sales) $3,192.4 3.2 $1,36 $1,34 $367. $371. 3.3 3.6 8 8 $4.74 $4.81 11.0% 42.1% 42.0% 11.5% 11.5% FY 2020 F
Slide 8: MSC Total Organic Growth vs Industrial Production Index
Industrial Production Index (IP) MSC Total Organic Growth 3‐Month Average 20.0% 15.0% 10.0% Change (Year‐Over‐Year) 5.0% 0.0% ‐5.0% ‐10.0% ‐15.0% ‐20.0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 MSC Total Growth (3 Mo Avg) IP Growth (3 Mo Avg) 8
Slide 9: Fiscal Fourth Quarter 2021 Balance Sheet and Liquidity Position
Fiscal Fourth Quarter 2021 Balance Sheet and Liquidity Position Free Cash Flow* Net Debt (millions) (millions) $170.7 $745.5 $494.1 $69.0 Q4 2020 Q4 2021 Q4 2020 Q4 2021 • Free cash flow decline reflects increases in inventory and accounts receivable related to sales growth, as well as significant c
Slide 10: Mission Critical: Strong Progress on Cost Savings
Mission Critical: Strong Progress on Cost Savings Total Gross Savings Target: KEY AREAS >$100M by end of FY23 versus FY19 $100 $80 Sales and service Supply chain General & Targeted Administrative FY2022: $25M FY2022 Savings • FY21 growth investments ~$23M $60 • Net savings of ~$17M in FY21 Q4 FY2021
Slide 11: Fiscal 2022 Framework – Adjusted
Fiscal 2022 Framework – Adjusted ADS Growth (YoY)1 Adjusted Operating Margin Range2 High single digits 12.0%- 12.6% Mid-single digits 11.7%- 12.3% 1Based on current IP forecasts. 2Excludes approximately $5-$10 million of restructuring and other related costs. 11
Slide 12: Summary
Summary Focused on executing in an improving environment and remain committed to serving our customers Encouraged by momentum as evidenced by improving results and project execution Implementation of Mission Critical initiatives expected to drive above market growth and improve profits faster than s
Slide 13: Appendix
Appendix MSC
Slide 14: Overview of Mission Critical
Overview of Mission Critical OBJECTIVE: OBJECTIVE: Reaccelerate market Grow profits faster share capture than sales KEY PRIORITIES KEY AREAS Solidify Leverage Expand Grow Diversify Sales & Supply General & Metalworking Portfolio Solutions E-commerce Customers & Services Chain Administrative Strength
Slide 15: Mission Critical: Reaccelerate Market Share Capture
Mission Critical: Reaccelerate Market Share Capture OBJECTIVE: Reaccelerate market INITIATIVES share capture KEY PRIORITIES • Build on talented team of metalworking specialists Solidify Leverage Expand Grow Diversify Metalworking Portfolio Solutions E-commerce Customers & • Leverage exclusive MSC St
Slide 16: Mission Critical: Grow Profits Faster than Sales
Mission Critical: Grow Profits Faster than Sales OBJECTIVE: INITIATIVES Grow profits faster than sales KEY AREAS • Optimize distribution center network • Renegotiated supplier contracts Sales & Supply General & Services Chain Administrative • Redesigned talent acquisition approach • Reduced cost of
Slide 17: Reconciliations
Reconciliations Non-GAAP Financial Measures Free Cash Flow (“FCF”) FCF is a non-GAAP financial measure. FCF is used in addition to and in conjunction with results presented in accordance with accounting principles generally accepted in the United States (“GAAP”), and FCF should not be relied upon
Slide 18: Reconciliations
Reconciliations Results Excluding Impairment Loss (Loss Recovery), Restructuring Costs, Inventory Write-downs Relating to Certain PPE Inventory, Legal and Acquisition Costs, and Other Related Costs and Tax Effects To supplement MSC’s unaudited and audited selected financial data presented consiste
Slide 19: Reconciliations
Reconciliations MSC INDUSTRIAL SUPPLY CO. AND SUBSIDIARIES Reconciliation of GAAP and Non-GAAP Financial Information Quarters and Years Ended August 28, 2021 and August 29, 2020 (dollars in thousands) GAAP Financial Measure Items Affecting Comparability Non-GAAP Financial Measure Net cash provided b
Slide 20: Reconciliations
Reconciliations MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Financial Information Thirteen Weeks Ended August 28, 2021 (dollars in thousands, except percentages and per share data) GAAP Financial Non-GAAP Measure Items Affecting Comparability Financial Measure Legal and Restr
Slide 21: Reconciliations
Reconciliations MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Financial Information Year Ended August 28, 2021 (dollars in thousands, except percentages and per share data) GAAP Financial Non-GAAP Measure Items Affecting Comparability Financial Measure Inventory Legal and Restr
Slide 22: Reconciliations
Reconciliations MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Financial Information Thirteen Weeks and Year Ended August 29, 2020 (dollars in thousands, except percentages and per share data) GAAP Financial Measure Items Affecting Comparability Non-GAAP Financial Measure Total
Slide 23: Reconciliations
Reconciliations MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Financial Information Years Ended August 28, 2021 and August 29, 2020 (dollars in thousands, except percentages) Fiscal Year Ended Fiscal Year Ended August 28, 2021 August 29, 2020 (a) Net income attributable to MSC
Slide 24: Slide 24
MSC Industrial Direct — Q4 2021 Earnings Presentation on 6ix