Conduits of Growth & Category Expansion

Made public by

sourced by PitchSend

13 of 21

Creator

Atkore logo
Atkore

Category

Industrial

Published

May 2022

Slides

Transcriptions

#1Investor Presentation & Company Overview February 2023 ▲ Atkore EVH#2Cautionary Statements ▲ Atkore This presentation is provided for general informational purposes only and it does not include every item which may be of interest, nor does it purport to present full and fair disclosure with respect to Atkore Inc. (the "Company" or "Atkore") or its operational and financial information. Atkore expressly disclaims any current intention to update any forward-looking statements contained in this presentation as a result of new information or future events or developments or otherwise, except as required by federal securities laws. This presentation is not a prospectus and is not an offer to sell securities. This presentation contains forward-looking statements that are subject to known and unknown risks and uncertainties, many of which are beyond our control. All statements other than statements of historical fact included in this presentation are forward-looking statements. Forward-looking statements appearing throughout this presentation include, without limitation, statements regarding our intentions, beliefs, assumptions or current expectations concerning, among other things, financial position; results of operations; cash flows; prospects; growth strategies or expectations; customer retention; the outcome (by judgment or settlement) and costs of legal, administrative or regulatory proceedings, investigations or inspections, including, without limitation, collective, representative or any other litigation; and the impact of prevailing economic conditions. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as "believes," "expects," "may," "will," "shall," "should," "would,” “could,” “seeks," "aims," "projects," "is optimistic," "intends,” “plans,” “estimates," "anticipates" and other comparable terms. We caution you that forward-looking statements are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation, our actual results of operations, financial condition and liquidity, and the development of the market in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this presentation. In addition, even if our results of operations, financial condition and cash flows, and the development of the market in which we operate, are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of results or developments in subsequent periods. A number of important factors, including, without limitation, the risks and uncertainties discussed under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K and the Quarterly Report on Form 10-Q filed with the U.S. Securities and Exchange Commission, could cause actual results and outcomes to differ materially from those reflected in the forward-looking statements. Because of these risks, we caution that you should not place undue reliance on any of our forward-looking statements. New risks and uncertainties arise from time to time, and it is impossible for us to predict those events or how they may affect us. Further, any forward-looking statement speaks only as of the date on which it is made. We undertake no obligation to revise the forward-looking statements in this presentation after the date of this presentation. Market data and industry information used throughout this presentation are based on management's knowledge of the industry and the good faith estimates of management. We also relied, to the extent available, upon management's review of independent industry surveys, forecasts and publications and other publicly available information prepared by a number of third-party sources. All of the market data and industry information used in this presentation involves a number of assumptions and limitations which we believe to be reasonable, but you are cautioned not to give undue weight to such estimates. Although we believe that these sources are reliable, we cannot guarantee the accuracy or completeness of this information, and we have not independently verified this information. While we believe the estimated market position, market opportunity and market size information included in this presentation are generally reliable, such information, which is derived in part from management's estimates and beliefs, is inherently uncertain and imprecise. Projections, assumptions and estimates of our future performance and the future performance of the industry in which we operate are subject to a high degree of uncertainty and risk due to a variety of factors, including those described above. These and other factors could cause results to differ materially from those expressed in our estimates and beliefs and in the estimates prepared by independent parties. This presentation should be read along with the historical financial statements of Atkore, including the most recent audited financial statements. Historical results may not be indicative of future results. We use non-GAAP financial measures to help us describe our operating and financial performance. These measures may include Adjusted EBITDA, Adjusted EBITDA margin (Adjusted EBITDA over Net sales), Net debt (total debt less cash and cash equivalents), Adjusted Net Income Per Share (also referred to as "Adjusted EPS"), Leverage ratio (net debt or total debt less cash and cash equivalents, over Adjusted EBITDA on trailing twelve month ("TTM") basis), Free Cash Flow (net cash provided by operating activities less capital expenditures) and Return on Capital to help us describe our operating and financial performance. These non-GAAP financial measures are commonly used in our industry and have certain limitations and should not be construed as alternatives to net income, total debt, net cash provided by operating activities, return on assets, and other income data measures as determined in accordance with generally accepted accounting principles in the United States, or GAAP, or as better indicators of operating performance. These non-GAAP financial measures as defined by us may not be comparable to similarly-titled non-GAAP measures presented by other companies. Our presentation of such non- GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. See the appendix to this presentation for a reconciliation of the non-GAAP financial measures presented herein to the most comparable financial measures as determined in accordance with GAAP. Fiscal Periods - The Company has a fiscal year that ends on September 30th. It is the Company's practice to establish quarterly closings using a 4-5-4 calendar. The Company's fiscal quarters typically end on the last Friday in December, March and June. A Atkore 2#3Atkore: a Compelling Investment 13891 A Atkore A Atkore 卲 Disciplined Operational Focus Values-based organization driven by the Atkore Business System Goff Track Record of Success Strong track record of earnings growth, increasing free cash flow and excellent return on capital Market Leadership Leading market share in key product categories with a portfolio of must-stock products for electrical distributors Strong Secular Tailwinds Our solutions are critical to enabling the energy transition and investment in digital infrastructure Opportunities for Growth Multiple levers and opportunities to drive sustainable growth through both organic and inorganic investments Strong Financial Profile & Long-Term Outlook A Atkore $ Strong liquidity position with a balance sheet ready to support and help drive future growth 3#4Our Foundation Is the Atkore Business System Atkore Business System Strategy Strategy Fundamental • Market Insights • Portfolio Management * Innovation and New Product Development • Strategy Development ▲ Atkore A Atkore Lean Daily Management (LDM) How we run the business we have today People Fundamental . Engagement and Alignment Diversity, Equity and Inclusion • Communication • Talent Acquisition • Performance Management Leadership Development • Total Rewards Strategy Deployment Process (SDP) How we build the business we aspire to be People Process Process Fundamental • Continuous Improvement Methodologies * Visual Workplace and Lean Daily Management • Built in Quality * Information and Material Flow • Equipment Availability and Reliability • Commercial Excellence#5Our Products Are All Around You ▲ Atkore A Wire Basket Cable Tray & Fittings Electrical Prefabrication Cable Tray, Ladder & Fittings Steel Conduit & Fittings Specialty Electrical Conduit: Stainless Steel, PVC-Coated & Aluminum PVC and Metal Trunking Telescoping Sign Support System HDPE Conduit Atkore F 마 1000 Armored Cable Flexible & Liquid Tight Electrical Conduit Industrial Flexible Electrical Conduit Metal Framing & Fittings (Including Seismic) Roller Tube for Conveyor Perimeter Security Solutions Security Bollards PVC and Fiberglass Electrical Conduit & Fittings 5#6Our Business Has Transformed Since IPO ▲ Atkore Transformed sales mix to drive significant revenue growth and profitability through organic and inorganic activities while increasing our total addressable market opportunity Adjusted EBITDA Margin¹ 15.1% Net Sales by Key Product Area² Adjusted EBITDA Margin¹ 34.3% Total Addressable Market Opportunity $3.9B 39% >2X Addressable Market Increase Since IPO $1.5B 7 Acquisitions Completed ▲ Atkore 19% ($40B+ 18% 17% 23% 18% 14% 24% 17% 11% FY2017 FY2022 Plastic Pipe, Conduit & Fittings Metal Electrical Conduit & Fittings Metal Framing, Cable Management & Construction Services Electrical Cable & Flexible Conduit Mechanical Tube & Other A Atkore 1. See non-GAAP reconciliation in appendix. 2. Sales of "Other Electrical products" and "Other Safety & Infrastructure products" have been allocated and included in the presentation of the product area groupings listed for presentation purposes. Source: Management estimates.#7Diversity of End-Market Use Enables Flexibility Estimated Net Sales by Key Product Area & Market A Atkore Plastic Pipe, Conduit & Fittings Metal Electrical Conduit & Fittings Metal Framing, Cable Management & Construction Services Electrical Cable & Flexible Conduit Mechanical Tube & Other Est. % of total sales Non-Residential Construction (Global) Residential (U.S.) Commercial & Industrial Institutional Data Centers & Warehouses Utility Multi-Family Single Family A Atkore Source: Company analysis and estimates OEM/OTHER ~65-75% ~15-20% ~10-15% 7#8Exposed to Strong Underlying MegaTrends ▲ Atkore Demand Driver by Key Product Area "Electrification of Everything" Grid Hardening Digital Infrastructure Growth in Renewables (Illustrative Impact) Plastic Pipe, Conduit & Fittings + +++ +++ + Metal Electrical Conduit & Fittings + ++ + Metal Framing, Cable Management & Construction Services + +++ + Electrical Cable & Flexible Conduit + + Mechanical Tube + +++ A Atkore According to a study from Princeton University, electrifying nearly all transport and buildings could contribute to doubling or more the amount of electricity used in the U.S. by 2050. That would lift electricity's share of total energy used to close to 50% from about 20% today. Source: The Wall Street Journal. In 2021, PG&E announced plans to underground 10,000 miles of powerlines For Florida Power & Light's (FPL) Storm Secure Power Line Program, approximately two dollars from every paying customer every month goes toward the initiative Source: Company websites. Double digit increase in data center spend through 2026 $65B committed for broadband deployment by the Infrastructure Investment and Jobs Act (IIJA) $39B in manufacturing incentives for semiconductor manufacturing from the CHIPS and Science Act Source: International Data Corporation; U.S. Chamber of Commerce; WhiteHouse.gov A Expect greater than 50% of US power supply from renewables by 2035 In 2021, 46% of all new electric capacity added to the grid came from solar ▲ Various investments throughout the value chain included in the Inflation Reduction Act (IRA) Source: McKinsey; Solar Energy Industry Association; Sidley.#9Conduits of Growth A Atkore M&A Pipeline Category Expansion Initiatives A Atkore ORDER DELIVERY INVOICE Customer Experience Enhancements Digital Capabilities & Resources Ongoing investment areas across the business to improve market positioning and operational capabilities ▲ Atkore Focused Product Category Growth & Innovation 9#10Strategic & Disciplined Approach to M&A M&A A ▲ Atkore Critical mass in served markets & Focused on Key Markets with Growth Opportunities ▲ Seek growth in core product categories for scale in key markets Diligent assessment of macro growth trends and competitive landscape ▲ Unlock access to attractive markets, new technologies, product innovations and geographic expansion Value creation Stewardship & Atkore values + Value creation through Atkore Business System ▲ The Atkore Business System unlocks synergistic value with a focus on people, process and strategy Building upon our value proposition to our customers of "One order. One delivery. One invoice." ▲ Past synergies have driven highly attractive returns on capital, and support shareholder value creation Stewardship & Atkore Values Leverage Atkore's corporate values to nurture acquired businesses during integration, including customers, employees, suppliers and management ▲ Successful track record in retaining and promoting management and employees of acquired companies Atkore 10#11Category Expansion Example HDPE Products Expected to Drive Growth ▲ Atkore Between recent organic and inorganic investments, we expect our HDPE related products to be a strong driver of growth for the next several years given the secular tailwinds behind the products and our execution of the Atkore Business System HDPE Products Market Review TOTAL MARKET SIZE ~$7B Product Categories Included: Conduit, Pressure Pipe, Water Pipe, and Corrugated KEY APPLICATIONS SERVED BY ATKORE A Broadband & Telecom ▲ Power Utility and Renewable Energy Oil & Gas Transmissions & Distribution • Water Infrastructure Transportation GROWTH DRIVERS Expansion of 5G Networks & "Fiber to the Home" and IIJA tailwind ▲ Vertical integration opportunities with internal recycling business ▲ Execution of the Atkore Business System ATKORE PRESENCE A A Completed Four Acquisitions Since December 2021 Organic Expansion Plans in Dallas, Texas #2 Position in Conduit Products Expect to be a Top 10 player in overall HDPE market across all product categories Broadband and Telecom Applications Expected to Drive Solid Growth for Conduit Products Over the Next Several Years A Atkore 11#12X Category Expansion Example New Large Tube Capacity & Capabilities Provide Opportunity Solar megatrend represents a growth and category expansion opportunity ― leveraging recent capability and capacity investments for mechanical tubing products that can be used in renewable energy applications. A Atkore let's make in HOME A In May 2022, unveiled two manufacturing lines for producing mechanical tube for use in utility- scale solar projects in our Phoenix, Arizona facility Investment in new Hobart, Indiana facility will provide opportunity to support potential growth from solar and other large tube applications 12#13Focus Category & Innovation Focused Product Category Growth & Innovation Atkore New product innovation and share gain opportunities in key categories and markets expected to contribute to incremental and profitable growth over the next several years Growth Examples PLASTIC PIPE & CONDUIT & FITTINGS METAL ELECTRICAL CONDUIT & FITTINGS METAL FRAMING, CABLE MANAGEMENT & CONSTRUCTION SERVICES ELECTRICAL CABLE & FLEXIBLE CONDUIT • Expansion of Cor-TekTM Cellular Core PVC into new U.S. geographies for conduit and end- use markets such as pipe for water applications Tested and certified our corrosion- resistant PVC-coated conduit against high-performance standards, opening new specification-driven markets Drove adoption of U.S. made Eagle BasketTM with Quick Latch TM securing wins in data centers and chip manufacturing Continued expansion of our patented and award-winning MC Glide™ electrical cable family which now includes aluminum and steel armor and additional luminary and fire alarm cable offerings A Atkore ZAN PVC Coated Cant OCTOO ZAS PC Coed Con PIZDNICT TALOG 13#14Updated Capital Deployment Framework A Atkore Capital Deployment Focused on Driving Growth in Adjusted EPS Capital Deployment Model - FY 2023 & Forward Capital Expenditures, Organic Growth, and Capacity Investments Status Update ~$200M in expected capital expenditures in FY23; includes investment in HDPE product expansion initiatives; Expect future capital spending to be between 3-4% of net sales Target Cash Flow from Operating Activities to be approximately 100% of Net Income Averaged Over a 3-Year Period Maintain Gross Debt to normalized Adj. EBITDA ratio at ~2x or below; willing to go above for select strategic opportunities Priority Uses for Capital A Atkore 1. Plan announced in November 2021. M&A Stock Repurchases Strong pipeline with a disciplined approach; Expect M&A to be focused on growing portfolio to expand and capture more of our total addressable market $1.3B in authorization; over $750M in stock repurchases completed since initial program authorization in November 2021 14#15▲ Atkore Achieving Progress on our ESG Goals Published 2022 Sustainability Report Climate, Carbon and GHG Emissions Goal: Reduce Scope 1 and Scope 2 GHG intensity by 10% by 20251 0 2020 Baseline 58.2 Metric Tons CO2e / Million $ 2022 Progress 54.1 Metric Tons CO2e / Million $ 2025 Target 52.4 Metric Tons CO2e / Million $ Health and Safety Goal: Increase % of sites meeting their annual Team-Based Safety Observation (TBSO) targets to 80% by 2025 + 2020 Baseline 48% 2022 Progress 69% Diversity, Equity, and Inclusion Goal: Achieve 30% diversity across Senior Leadership by 2025 2025 Target 80% 2020 Baseline 23% 2022 Progress 27% 2025 Target 30% Employee Attraction, Development, and Retention Goal: Increase participation in Employee Engagement and Alignment Survey to 80% by 2025 2025 Target 2020 Baseline 56% 2022 Progress 78% A Atkore 1. Revenue used to calculate FY22 and future GHG emissions intensity is or will be adjusted to remove the impact of changes in average selling prices. 80% 15#16Recent Recognition & Accolades Great Place To WorkⓇ Certified OCT 2022-OCT 2023 USA TM TOP WORK PLACES 2023 USA AMERICA'S MOST RESPONSIBLE COMPANIES 2023 Newsweek statista ▲ Atkore Forbes 2023 AMERICA'S BEST MIDSIZE COMPANIES Great Place to Work® Certified for 3rd year in a row Top Workplaces USA Award for 2nd year in a row Ranked #195 out of 500 largest U.S. public corporations for Newsweek's 2023 America's Most Responsible Companies Ranked #8 in Forbes' 2023 Top 100 Best Mid-Sized Companies A Atkore 16#17Atkore: a Compelling Investment 13891 A Atkore A Atkore 卲 Disciplined Operational Focus Values-based organization driven by the Atkore Business System Goff Track Record of Success Strong track record of earnings growth, increasing free cash flow and excellent return on capital Market Leadership Leading market share in key product categories with a portfolio of must-stock products for electrical distributors Strong Secular Tailwinds Our solutions are critical to enabling the energy transition and investment in digital infrastructure Opportunities for Growth Multiple levers and opportunities to drive sustainable growth through both organic and inorganic investments Strong Financial Profile & Long-Term Outlook A Atkore $ Strong liquidity position with a balance sheet ready to support and help drive future growth 17#18Questions? A Atkore 615 MOUTAIN'S#19Net Income to Adjusted EBITDA Reconciliation Consolidated Atkore Inc. (in thousands) Net income Income tax expense Depreciation and amortization Interest expense, net Stock-based compensation Loss on extinguishment of debt Gain on purchase of a business Gain on sale of a business Gain on sale of joint venture Transaction costs Other (a) Adjusted EBITDA Net Sales ▲ Atkore Fiscal Year Ended 2021 2020 September 30, September 30, September 30, September 30, September 30, September 30, 2022 2019 2018 2017 913,434 $ 587,857 $ 152,302 139,051 $ 136,645 $ 84,639 290,186 192,144 49,696 45,618 29,707 41,486 84,415 78,557 74,470 72,347 66,890 54,727 30,676 32,899 40,062 50,473 40,694 26,598 17,245 17,047 13,064 11,798 14,664 12,788 4,202 273 9,805 (7,384) (27,575) (5,774) 3,424 $ 2,410 1,341,790 $ 667 (15,826) 897,547 $ 196 (3,428) 1,200 9,314 4,779 11,305 1,210 (1,440) 326,635 $ 324,408 $ 271,549 $ 227,608 3,913,949 2,928,014 1,765,421 1,916,538 1,835,139 1,503,934 (a) Represents other items, such as inventory reserves and adjustments, loss on disposal of property, plant and equipment, insurance recovery related to damages of property, plant and equipment, release of indemnified uncertain tax positions and realized or unrealized gain (loss) on foreign currency impacts of intercompany loans, certain legal matters, restructuring charges, and related forward currency derivatives. A Atkore 19#20A Atkore A Atkore TM A Atkore Allied Tube & Conduit Unistrut Construction A AFC Cable Systems A Heritage Plastics A Cii A Unistrut A US Tray A Marco A Calpipe Security A Calbrite A Calbond A Flexicon A Kaf-Tech Power-Strut A Calconduit A * FRE Composites A United Poly Systems A Sasco Strut Elite Polymer Solutions 4 Four Star Industries A Eastern Wire + Conduit A ACS/Uni-Fab Northwest Polymers A Cascade Poly Pipe + Conduit A Razor Ribbon A Queen City Plastics Columbia-MBF Vergokan Cope atkore.com Atkore 20 20

Download to PowerPoint

Download presentation as an editable powerpoint.

Related

ILPT Q2 2023 Financial Results image

ILPT Q2 2023 Financial Results

Industrials

Investor Presentation September 2023 image

Investor Presentation September 2023

Real Estate

Strategic Expansion in the Resilient Data Centre Segment image

Strategic Expansion in the Resilient Data Centre Segment

Real Estate

Economic Impact of NOS4A2 in Rhode Island image

Economic Impact of NOS4A2 in Rhode Island

Television & Film Industry

Strategic Entry into Japan's Data Centre Market image

Strategic Entry into Japan's Data Centre Market

Industrials

GIDC Gujarat Industrial Development image

GIDC Gujarat Industrial Development

Industrials

WF Hebei Wenfeng Industrial Co. Corporate Presentation image

WF Hebei Wenfeng Industrial Co. Corporate Presentation

Financial

Dadra & Nagar Haveli Industrial Policy Pitch image

Dadra & Nagar Haveli Industrial Policy Pitch

Financial