Slide 1: AZZ Inc. Q4 and Full Year FY2022 Earnings Presentation
AZZ Inc. Q4 and Full Year FY2022 Earnings Presentation April 22, 2022
Slide 2: Safe Harbor Statement
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Safe Harbor Statement 2 Certain statements herein about our expectations of future events or results constitute forward-looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. You can identif
Slide 3: Fiscal Year 2022 Segment Performance Update
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Fiscal Year 2022 Segment Performance Update Full Year FY2022 Sales: $902.7 million Segment Updates Metal Coatings Segment $519.0 Infrastructure Solutions Segment $383.7 • Record Metal Coatings segment sales driven by higher volume and value pricing • Com
Slide 4: Summary - Consolidated: Sales, Net Income, Diluted EPS
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Sales Net Income Diluted EPS Fiscal Year 2022 Summary - Consolidated $838.9 $902.7 FY21 FY22 +7.6% • Higher sales volume primarily attributable to strong sales in Metal Coatings • Continued improvement in Metal Coatings productivity utilizing DGS and pri
Slide 5: Segment Results – Metal Coatings
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Fiscal Year 2022 Segment Results – Metal Coatings • Higher sales a result of increased volume and value pricing • Improved operating efficiencies and productivity as DGS utilization continues to grow • Completed acquisitions of Steel Creek Galvanizing an
Slide 6: Segment Results – Infrastructure Solutions
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Fiscal Year 2022 Segment Results – Infrastructure Solutions • Bookings increased to $502 million as result of strong market demand; Booked a large 125 unit battery energy storage system (BESS) enclosure project • Electrical and Industrial Platform sales
Slide 7: Fiscal Year 2023 Q1 Outlook
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Fiscal Year 2023 Q1 Outlook 7 • Due to our recently announced, and pending acquisition of Precoat Metals, AZZ will not issue FY2023 guidance at this time. • Volumes in the Metal Coatings segment continue to be strong. We anticipate sales will exceed $150
Slide 8: Q4 FY2022 Consolidated Results
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Q4 FY2022 Consolidated Results In millions, except for EPS and percentages Q4 FY 22 Reported Q4 FY 21 Reported % Change Sales $224.7 $195.6 +14.8% Gross Profit $55.2 $45.8 +20.6% Gross Margin percent 24.6% 23.4% 120 bps Operating Profit $26.0 $18.8 38.5%
Slide 9: Consolidated Results
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Fiscal Year 2022 Consolidated Results In $ millions, except for EPS and percentages FY 2022 Reported FY 2022 Adjusted FY 2021 Reported FY 2021 Adjusted Sales $902.7 $902.7 $838.9 $838.9 Gross Profit $225.2 $225.2 $188.7 $188.7 Gross Margin 25.0% 25.0% 22
Slide 10: Cash Flow Highlights
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Fiscal Year 2022 Cash Flow Highlights In $ millions, except for percentages FY 2022 FY 2021 Cash flows provided by operating activities $86.0 $92.0 Less: Capital Expenditures $(28.4) $(38.6) Free Cash Flow $57.6 $53.5 Net Income $84.0 $39.6 Free Cash Flo
Slide 11: Capital Allocation Focused on Growth
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Capital Allocation Focused on Growth $28.4 $61.2 $30.8 $16.9 Capital Expenditures Acquisitions Share Repurchases Dividends Capital Expenditures Acquisitions Share Repurchases Dividends In $ millions • Safety, Health and Environmental • Product/technology
Slide 12: Key Indicators and Initiatives
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION 12 Metal Coatings Segment • Cost of zinc in our kettles, which increased throughout FY2022, is expected to continue to rise • Emphasis on operating efficiency and productivity, supported by Digital Galvanizing System (“DGS”) investment Infrastructure Sol
Slide 13: Strategic Direction
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION • Meaningfully advanced our strategy of becoming predominately a coatings company o Entered into definitive agreement to acquire Precoat Metals from Sequa/Carlyle o Expected to be accretive during first full year of operations o Obtained Hart-Scott Rodin
Slide 14: Q&A
Q&A
Slide 15: Q4 Segment Performance Update
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Q4 Fiscal Year 2022 Segment Performance Update Total Q4 FY2022 Sales: $224.7 million Market Drivers Metal Coatings Segment $128.3 Infrastructure Solutions Segment $96.4 • Sales up 20.9% versus prior year’s quarter, on higher volumes of steel galvanized a
Slide 16: Q4 Summary - Consolidated
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Sales Net Income Diluted EPS Q4 Fiscal Year 2022 Summary - Consolidated $195.6 $224.7 FY21 FY22 +14.8% • Higher sales volume in Metal Coatings • Improved turnaround activity in WSI • Price/value realization in Metal Coatings • Improved operational effici
Slide 17: Q4 Segment Results – Metal Coatings
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Q4 Fiscal Year 2022 Segment Results – Metal Coatings • Quarterly sales increase reflects higher sales volume and pricing for galvanizing • Operating Margins of 24.5%, compared to 25.1% for the same quarter last year a result of increased labor and materi
Slide 18: Q4 Segment Results – Infrastructure Solutions
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Q4 Fiscal Year 2022 Segment Results – Infrastructure Solutions • Book to ship ratio increasing significantly from last year • Higher sales in our industrial solutions business, driven by improved turnarounds • Growing domestic backlog of orders of enclos
Slide 19: Appendix and Additional Information
Appendix and Additional Information
Slide 20: Non-GAAP Disclosure of EBITDA
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION In addition to reporting financial results in accordance with Generally Accepted Accounting Principles in the United States ("GAAP"), AZZ has provided EBITDA and Adjusted EBITDA, which are non-GAAP measures. Management believes that the presentation of t
Slide 21: Q4 Fiscal 2022 - Non-GAAP Disclosure of Consolidated EBITDA
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Q4 Fiscal 2022 - Non-GAAP Disclosure of Consolidated EBITDA 21 In millions Consolidated Q4 FY 22 Consolidated Q4 FY 21 GAAP Net Income $21.6 $16.2 Adjustments to reconcile GAAP to non- GAAP Financial Measures Interest Expense $1.3 $2.3 Income Tax (Benefi
Slide 22: Full Year Fiscal 2022 - Non-GAAP Disclosure of Consolidated EBITDA
Q4 AND FULL YEAR FY2022 EARNINGS PRESENTATION Full Year Fiscal 2022 - Non-GAAP Disclosure of Consolidated EBITDA 22 In millions Consolidated FY 22 Consolidated FY 21 GAAP Net Income $84.0 $39.6 Adjustments to reconcile GAAP to non- GAAP Financial Measures Interest Expense $6.4 $9.6 Income Tax Expens