Myers Industries Inc.
11/04/2024 | Press release | Distributed by Public on 11/04/2024 15:07
Myers Industries Announces Third Quarter 2024 Results
Improved gross margins and adjusted EBITDA driven by strong performance of Signature Systems
Ongoing demand headwinds within certain end markets expected for the remainder of 2024
Continued focus on cost reduction; additional $15 million of annualized run rate cost savings targeted by 2025
Full-year guidance revised to $0.92 - $1.02 for adjusted earnings per share
AKRON, Ohio--(BUSINESS WIRE)-- Myers Industries Inc. (NYSE: MYE), a leading manufacturer of a wide range of polymer and metal products and distributor for tire, wheel, and under vehicle service industry, today announced results for the third quarter ended September 30, 2024.
Third Quarter 2024 Financial Highlights
- Net sales of $205.1 million compared with $197.8 million in the prior-year period
- Net Income (loss) of $(10.9) million, compared to $12.7 million in the prior-year period inclusive of a non-cash goodwill impairment charge of $22.0 million
- Adjusted EBITDA of $30.7 million, compared to $25.6 million in the prior-year period
- GAAP gross margin of 31.8%, up 30 basis points versus the prior-year period
- Adjusted gross margin of 32.4%, up 70 basis points versus the prior-year period
- GAAP net income (loss) per diluted share of $(0.29) compared with $0.34 in the prior-year period
- Adjusted earnings per diluted share of $0.25 compared with $0.38 in the prior-year period
- Cash flow provided by operations of $17.3 million and free cash flow of $10.1 million
- Additional debt paydown of $13 million
Dave Basque, Myers Industries Interim President and CEO, commented "This quarter's results were driven by continued strong performance from our Signature Systems acquisition, growth in our military end market, the initial benefits of our cost cutting initiatives and reduced variable compensation. These benefits mitigated some broader macro-economic challenges in the RV and Marine and new headwinds in the Food and Beverage end markets.
"During the quarter, we diligently focused on our cost containment actions which we now estimate will lead to an additional $15 million in annualized cost savings. These cost savings are incremental to our original target of $7 million to $9 million and are expected to be driven by labor savings, manufacturing efficiencies, continued footprint optimization and other savings initiatives. We will continue to implement cost actions to help mitigate the impact of revenue headwinds in key end markets.
"We have taken additional action to address the underperformance of our Distribution business, starting with naming Jeff Baker as President, Distribution. Since assuming this role on September 30, Jeff and his team have systematically identified plans to close sales coverage gaps and win back customers, add digital sales channels, improve the customer experience and implement further efficiency improvements.
"We are updating our outlook and expect full year adjusted earnings per share to be in the range of $0.92 to $1.02. We continue to have confidence in the growth and earnings potential of our four power brands as demand recovers in affected end markets, and we remain focused on improving operations in the near-term to navigate choppy macro-economic conditions."
Third Quarter 2024 Financial Summary
|
Quarter Ended September 30, |
||||||||||||
|
(Dollars in thousands, except per share data) |
2024 |
2023 |
% Inc |
|||||||||
|
Net sales |
$ |
205,067 |
$ |
197,798 |
3.7 |
% |
||||||
|
Gross profit |
$ |
65,130 |
$ |
62,379 |
4.4 |
% |
||||||
|
Gross margin |
31.8 |
% |
31.5 |
% |
||||||||
|
Operating income (loss) |
$ |
(4,764 |
) |
$ |
18,703 |
(125.5 |
)% |
|||||
|
Net income (loss) |
$ |
(10,878 |
) |
$ |
12,747 |
(185.3 |
)% |
|||||
|
Net income (loss) per diluted share |
$ |
(0.29 |
) |
$ |
0.34 |
(185.3 |
)% |
|||||
|
Adjusted operating income |
$ |
20,539 |
$ |
20,039 |
2.5 |
% |
||||||
|
Adjusted net income |
$ |
9,212 |
$ |
13,875 |
(33.6 |
)% |
||||||
|
Adjusted earnings per diluted share |
$ |
0.25 |
$ |
0.38 |
(34.2 |
)% |
||||||
|
Adjusted EBITDA |
$ |
30,735 |
$ |
25,648 |
19.8 |
% |
Net sales were $205.1 million, an increase of $7.3 million, or 3.7%, compared with $197.8 million for the third quarter of 2023. The increase in net sales was driven by contributions from the recent acquisition of Signature Systems, partially offset by lower volumes and pricing in both the Material Handling and Distribution segments.
Gross profit increased $2.8 million, or 4.4%, to $65.1 million, driven by performance at Signature Systems and favorable product mix, partially offset by lower pricing and volume, as well as higher material and other cost inflation. Gross margin improved 30 basis points to 31.8% compared with 31.5% for the third quarter of 2023. On an adjusted basis, gross margin increased 70 basis points to 32.4% from 31.7%. Selling, general and administrative expenses were $47.7 million, an increase of $4.0 million, primarily due to the addition of Signature and partially offset by lower incentive compensation expense. SG&A as a percent of sales was 23.3% vs 22.1% in the prior year in part due to the executive severance recorded in the quarter. The company also recorded a $22.0 million non-cash goodwill impairment charge related to goodwill from prior rotational molding acquisitions. Net income per diluted share was ($0.29), compared with $0.34 for the third quarter of 2023. Adjusted earnings per diluted share were $0.25, compared with $0.38 for the third quarter of 2023.
Third Quarter 2024 Segment Results
(Dollar amounts in the segment tables below are reported in millions)
Material Handling
|
Net Sales |
Op Income |
Op Income Margin |
Adj EBITDA |
Adj EBITDA Margin |
|||||
|
Q3 2024 Results |
$150.7 |
$0.9 |
0.6% |
$33.5 |
22.2% |
||||
|
Q3 2023 Results |
$132.5 |
$20.0 |
15.1% |
$25.1 |
19.0% |
||||
|
$ Increase (decrease) vs prior year |
$18.2 |
($19.1) |
$8.3 |
||||||
|
% Increase (decrease) vs prior year |
13.8% |
(95.6)% |
-1,450bps |
33.0% |
+320bps |
||||
|
Items in this table may not recalculate due to rounding |
Net sales for the Material Handling segment were $150.7 million, an increase of $18.2 million, or 13.8%, compared with $132.5 million for the third quarter of 2023. Sales from the addition of Signature Systems were partly offset by sales declines, primarily in Seed boxes and within Food and Beverage end markets.
Operating income was $0.9 million compared with $20.0 million in the third quarter of 2023 primarily due to the non-cash goodwill impairment and the lower sales volume and pricing in the legacy business, partially offset by the Signature acquisition. Material Handling's operating income margin of 0.6%, or 15.2% excluding the non-cash goodwill impairment, compared to 15.1% in the third quarter of 2023. Adjusted EBITDA increased 33.0% to $33.5 million, compared with $25.1 million in the third quarter of 2023. SG&A expenses increased year-over-year, primarily due to incremental SG&A from Signature, partly offset by lower incentive compensation. Adjusted EBITDA margin improved by 320 basis points, primarily attributed to the Signature acquisition, partially offset by higher material costs and lower sales volume and pricing in the legacy business. A $22.0 million non-cash goodwill impairment charge is included in the third quarter 2024 GAAP results of the Material Handling segment.
Distribution
|
Net Sales |
Op Income |
Op Income Margin |
Adj EBITDA |
Adj EBITDA Margin |
|||||
|
Q3 2024 Results |
$54.4 |
$2.1 |
3.9% |
$3.2 |
5.8% |
||||
|
Q3 2023 Results |
$65.3 |
$5.0 |
7.6% |
$6.6 |
10.1% |
||||
|
$ Increase (decrease) vs prior year |
($11.0) |
($2.9) |
($3.4) |
||||||
|
% Increase (decrease) vs prior year |
(16.8)% |
(57.3)% |
-370bps |
(51.8)% |
-430bps |
||||
|
Items in this table may not recalculate due to rounding |
Net sales for the Distribution segment were $54.4 million, a decrease of $11.0 million, or 16.8%, compared with $65.3 million for the third quarter of 2023. The decrease was primarily driven by lower volume and pricing, partially offset by improved SG&A costs.
Operating income decreased $2.9 million to $2.1 million, compared with $5.0 million for the third quarter of 2023. Adjusted EBITDA decreased to $3.2 million, compared with $6.6 million in the third quarter of 2023. The decrease in operating income and adjusted EBITDA was primarily due to lower volume and pricing, as well as higher material costs. SG&A expenses decreased year-over-year, primarily due to lower payroll costs. The Distribution segment's operating income margin was 3.9% compared with 7.6% for the third quarter of 2023. The Distribution segment's adjusted EBITDA margin was 5.8%, compared with 10.1% for the third quarter of 2023.
Balance Sheet & Cash Flow
As of September 30, 2024, the Company's cash on hand totaled $29.7 million. Total debt as of September 30, 2024, was $396.2 million. Under the terms of the Company's loan agreement, its net leverage ratio was 2.7x and it had $239.4 million of availability under its revolving credit facility as of September 30, 2024. For the third quarter of 2024, cash flow provided by operations was $17.3 million and free cash flow was $10.1 million, compared with cash flow provided by operations of $22.1 million and free cash flow of $18.1 million for the third quarter of 2023. The decrease in free cash flow was driven primarily by the timing of disbursements. Capital expenditures for the third quarter of 2024 were $7.2 million compared with $4.1 million for the third quarter of 2023.
2024 Outlook
Based on current exchange rates, market outlook and business forecast, the Company is providing the following outlook for fiscal 2024:
- Net sales growth of 0% to 5% compared to prior guidance of 5% to 10%
- Net income per diluted share in the range of $0.11 to $0.21 compared to prior guidance of $0.76 to $0.91
- Adjusted earnings per diluted share in the range of $0.92 to $1.02 compared to prior guidance of $1.05 to $1.20
- Capital expenditures in the range of $28 million to $32 million compared to prior guidance of $30 million to $35 million
- Effective tax rate to approximate 26%
Myers will continue to monitor market conditions and provide updates throughout the year.
Conference Call Details
The Company will host an earnings conference call and webcast for investors and analysts on Monday, November 4, 2024, at 4:30 p.m. ET. The call is anticipated to last less than one hour and may be accessed using the following online participation registration link: https://www.netroadshow.com/events/login?show=2acccce1&confId=72128. Upon registering, each participant will be provided with call details and a registrant ID. Reminders will also be sent to registered participants via email. Alternatively, the conference call will be available via a live webcast. To access the live webcast or a replay, visit the Company's website www.myersindustries.com and click on the Investor Relations tab. An archived replay of the call will also be available on the site shortly after the event. To listen to the telephone replay, callers should dial: (U.S. Local) 1-929-458-6194 or (U.S. Toll-Free) 1-866-813-9403 and use access code 818386.
Use of Non-GAAP Financial Measures
The Company uses certain non-GAAP measures in this release. Adjusted gross profit, adjusted gross margin, adjusted operating income (loss), adjusted operating income margin, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted EBITDA margin, adjusted net income, adjusted earnings per diluted share (adjusted EPS), and free cash flow are non-GAAP financial measures and are intended to serve as a supplement to results provided in accordance with accounting principles generally accepted in the United States. Myers Industries believes that such information provides an additional measurement and consistent historical comparison of the Company's performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release.
About Myers Industries
Myers Industries Inc., based in Akron, Ohio, is a manufacturer of sustainable plastic and metal products for industrial, agricultural, automotive, commercial, and consumer markets. The Company is also the largest distributor of tools, equipment and supplies for the tire, wheel, and under-vehicle service industry in the United States. Visit www.myersindustries.com to learn more.
Caution on Forward-Looking Statements
Statements in this release include "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, including information regarding the Company's financial outlook, future plans, objectives, business prospects and anticipated financial performance. Forward-looking statements can be identified by words such as "will," "believe," "anticipate," "expect," "estimate," "intend," "plan," or variations of these words, or similar expressions. These forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on the Company's current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, these statements inherently involve a wide range of inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. The Company's actual actions, results, and financial condition may differ materially from what is expressed or implied by the forward-looking statements.
Specific factors that could cause such a difference on our business, financial position, results of operations and/or liquidity include, without limitation, raw material availability, increases in raw material costs, or other production costs; risks associated with our strategic growth initiatives or the failure to achieve the anticipated benefits of such initiatives; unanticipated downturn in business relationships with customers or their purchases; competitive pressures on sales and pricing; changes in the markets for the Company's business segments; changes in trends and demands in the markets in which the Company competes; operational problems at our manufacturing facilities or unexpected failures at those facilities; future economic and financial conditions in the United States and around the world; inability of the Company to meet future capital requirements; claims, litigation and regulatory actions against the Company; changes in laws and regulations affecting the Company; unforeseen events, including natural disasters, unusual or severe weather events and patterns, public health crises, geopolitical crises, and other catastrophic events; and other risks and uncertainties detailed from time to time in the Company's filings with the SEC, including without limitation, the risk factors disclosed in Item 1A, "Risk Factors," in the Company's Annual Report on Form 10-K for the year ended December 31, 2023. Given these factors, as well as other variables that may affect our operating results, readers should not rely on forward-looking statements, assume that past financial performance will be a reliable indicator of future performance, nor use historical trends to anticipate results or trends in future periods. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company expressly disclaims any obligation or intention to provide updates to the forward-looking statements and the estimates and assumptions associated with them.
M-INV
|
MYERS INDUSTRIES, INC. |
||||||||||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
||||||||||||||||
|
(Dollars in thousands, except share and per share data) |
||||||||||||||||
|
Quarter Ended |
Nine Months Ended |
|||||||||||||||
|
September 30, 2024 |
September 30, 2023 |
September 30, 2024 |
September 30, 2023 |
|||||||||||||
|
Net sales |
$ |
205,067 |
$ |
197,798 |
$ |
632,405 |
$ |
621,990 |
||||||||
|
Cost of sales |
139,937 |
135,419 |
427,489 |
420,136 |
||||||||||||
|
Gross profit |
65,130 |
62,379 |
204,916 |
201,854 |
||||||||||||
|
Selling, general and administrative expenses |
47,686 |
43,698 |
152,804 |
148,130 |
||||||||||||
|
(Gain) loss on disposal of fixed assets |
192 |
(22 |
) |
253 |
(78 |
) |
||||||||||
|
Impairment charges |
22,016 |
- |
22,016 |
- |
||||||||||||
|
Operating income (loss) |
(4,764 |
) |
18,703 |
29,843 |
53,802 |
|||||||||||
|
Interest expense, net |
8,091 |
1,539 |
23,176 |
4,975 |
||||||||||||
|
Income (loss) before income taxes |
(12,855 |
) |
17,164 |
6,667 |
48,827 |
|||||||||||
|
Income tax expense (benefit) |
(1,977 |
) |
4,417 |
3,763 |
12,499 |
|||||||||||
|
Net income (loss) |
$ |
(10,878 |
) |
$ |
12,747 |
$ |
2,904 |
$ |
36,328 |
|||||||
|
Net income (loss) per common share: |
||||||||||||||||
|
Basic |
$ |
(0.29 |
) |
$ |
0.35 |
$ |
0.08 |
$ |
0.99 |
|||||||
|
Diluted |
$ |
(0.29 |
) |
$ |
0.34 |
$ |
0.08 |
$ |
0.98 |
|||||||
|
Weighted average common shares outstanding: |
||||||||||||||||
|
Basic |
37,220,456 |
36,811,296 |
37,102,761 |
36,712,662 |
||||||||||||
|
Diluted |
37,220,456 |
36,979,880 |
37,250,512 |
36,972,384 |
|
MYERS INDUSTRIES, INC. |
|||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED) |
|||||||
|
(Dollars in thousands) |
|||||||
|
September 30, 2024 |
December 31, 2023 |
||||||
|
Assets |
|||||||
|
Current Assets |
|||||||
|
Cash |
$ |
29,710 |
$ |
30,290 |
|||
|
Trade accounts receivable, net |
122,723 |
113,907 |
|||||
|
Other accounts receivable, net |
8,495 |
14,726 |
|||||
|
Inventories, net |
105,103 |
90,844 |
|||||
|
Other current assets |
9,215 |
6,854 |
|||||
|
Total Current Assets |
275,246 |
256,621 |
|||||
|
Property, plant, & equipment, net |
134,641 |
107,933 |
|||||
|
Right of use asset - operating leases |
30,550 |
27,989 |
|||||
|
Goodwill and intangible assets, net |
450,967 |
140,521 |
|||||
|
Deferred income taxes |
210 |
209 |
|||||
|
Other assets |
13,385 |
8,358 |
|||||
|
Total Assets |
$ |
904,999 |
$ |
541,631 |
|||
|
Liabilities & Shareholders' Equity |
|||||||
|
Current Liabilities |
|||||||
|
Accounts payable |
$ |
79,279 |
$ |
79,050 |
|||
|
Accrued expenses |
47,392 |
53,523 |
|||||
|
Operating lease liability - short-term |
6,422 |
5,943 |
|||||
|
Finance lease liability - short-term |
615 |
593 |
|||||
|
Long-term debt - current portion |
19,624 |
25,998 |
|||||
|
Total Current Liabilities |
153,332 |
165,107 |
|||||
|
Long-term debt |
367,854 |
31,989 |
|||||
|
Operating lease liability - long-term |
23,738 |
22,352 |
|||||
|
Finance lease liability - long-term |
8,151 |
8,615 |
|||||
|
Other liabilities |
19,079 |
12,108 |
|||||
|
Deferred income taxes |
57,206 |
8,660 |
|||||
|
Total Shareholders' Equity |
275,639 |
292,800 |
|||||
|
Total Liabilities & Shareholders' Equity |
$ |
904,999 |
$ |
541,631 |
|
MYERS INDUSTRIES, INC. |
||||||||||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
||||||||||||||||
|
(Dollars in thousands) |
||||||||||||||||
|
Quarter Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
|
2024 |
2023 |
2024 |
2023 |
|||||||||||||
|
Cash Flows From Operating Activities |
||||||||||||||||
|
Net income (loss) |
$ |
(10,878 |
) |
$ |
12,747 |
$ |
2,904 |
$ |
36,328 |
|||||||
|
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities |
||||||||||||||||
|
Depreciation and amortization |
10,196 |
5,609 |
28,760 |
16,904 |
||||||||||||
|
Amortization of deferred financing costs |
543 |
78 |
1,318 |
234 |
||||||||||||
|
Amortization of acquisition-related inventory step-up |
- |
- |
4,457 |
- |
||||||||||||
|
Non-cash stock-based compensation expense |
190 |
686 |
737 |
5,078 |
||||||||||||
|
(Gain) loss on disposal of fixed assets |
192 |
(22 |
) |
253 |
(78 |
) |
||||||||||
|
Impairment charges |
22,016 |
- |
22,016 |
- |
||||||||||||
|
Other |
386 |
(19 |
) |
550 |
2,473 |
|||||||||||
|
Cash flows provided by (used for) working capital |
||||||||||||||||
|
Accounts receivable - trade and other, net |
7,434 |
(1,332 |
) |
15,646 |
13,764 |
|||||||||||
|
Inventories |
574 |
1,825 |
(1,385 |
) |
(2,905 |
) |
||||||||||
|
Prepaid expenses and other current assets |
2,975 |
1,775 |
(1,668 |
) |
(2,053 |
) |
||||||||||
|
Accounts payable and accrued expenses |
(16,301 |
) |
787 |
(21,644 |
) |
1,027 |
||||||||||
|
Net cash provided by (used for) operating activities |
17,327 |
22,134 |
51,944 |
70,772 |
||||||||||||
|
Cash Flows From Investing Activities |
||||||||||||||||
|
Capital expenditures |
(7,178 |
) |
(4,076 |
) |
(17,302 |
) |
(19,292 |
) |
||||||||
|
Acquisition of business, net of cash acquired |
- |
- |
(348,312 |
) |
(160 |
) |
||||||||||
|
Proceeds from sale of property, plant, and equipment |
28 |
- |
112 |
142 |
||||||||||||
|
Net cash provided by (used for) investing activities |
(7,150 |
) |
(4,076 |
) |
(365,502 |
) |
(19,310 |
) |
||||||||
|
Cash Flows From Financing Activities |
||||||||||||||||
|
Net borrowings (repayments) from revolving credit facility |
(8,000 |
) |
(19,000 |
) |
(15,000 |
) |
(34,000 |
) |
||||||||
|
Proceeds from Term Loan A |
- |
- |
400,000 |
- |
||||||||||||
|
Repayments of Term Loan A |
(5,000 |
) |
- |
(10,000 |
) |
- |
||||||||||
|
Repayments of senior unsecured notes |
- |
- |
(38,000 |
) |
- |
|||||||||||
|
Payments on finance lease |
(150 |
) |
(145 |
) |
(442 |
) |
(403 |
) |
||||||||
|
Cash dividends paid |
(5,025 |
) |
(4,970 |
) |
(15,392 |
) |
(15,266 |
) |
||||||||
|
Proceeds from issuance of common stock |
295 |
379 |
3,053 |
1,948 |
||||||||||||
|
Shares withheld for employee taxes on equity awards |
(53 |
) |
(22 |
) |
(2,027 |
) |
(2,055 |
) |
||||||||
|
Deferred financing fees |
- |
- |
(9,172 |
) |
- |
|||||||||||
|
Net cash provided by (used for) financing activities |
(17,933 |
) |
(23,758 |
) |
313,020 |
(49,776 |
) |
|||||||||
|
Foreign exchange rate effect on cash |
121 |
(224 |
) |
(42 |
) |
(57 |
) |
|||||||||
|
Net increase (decrease) in cash |
(7,635 |
) |
(5,924 |
) |
(580 |
) |
1,629 |
|||||||||
|
Beginning Cash |
37,345 |
30,692 |
30,290 |
23,139 |
||||||||||||
|
Ending Cash |
$ |
29,710 |
$ |
24,768 |
$ |
29,710 |
$ |
24,768 |
|
MYERS INDUSTRIES, INC. |
||||||||||||||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
||||||||||||||||||||
|
GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) |
||||||||||||||||||||
|
(Dollars in thousands) |
||||||||||||||||||||
|
Quarter Ended September 30, 2024 |
||||||||||||||||||||
|
Material Handling |
Distribution |
Segment Total |
Corporate & Other |
Total |
||||||||||||||||
|
Net sales |
$ |
150,718 |
$ |
54,384 |
$ |
205,102 |
$ |
(35 |
) |
$ |
205,067 |
|||||||||
|
Net income (loss) |
(10,878 |
) |
||||||||||||||||||
|
Net income margin |
-5.3 |
% |
||||||||||||||||||
|
Gross profit |
65,130 |
|||||||||||||||||||
|
Add: Restructuring expenses and other adjustments |
1,211 |
|||||||||||||||||||
|
Adjusted gross profit |
66,341 |
|||||||||||||||||||
|
Gross margin as adjusted |
32.4 |
% |
||||||||||||||||||
|
Operating income (loss) |
886 |
2,131 |
3,017 |
(7,781 |
) |
(4,764 |
) |
|||||||||||||
|
Operating income margin |
0.6 |
% |
3.9 |
% |
1.5 |
% |
n/a |
-2.3 |
% |
|||||||||||
|
Add: Executive severance costs |
- |
- |
- |
1,405 |
1,405 |
|||||||||||||||
|
Add: Restructuring expenses and other adjustments |
1,396 |
220 |
1,616 |
417 |
2,033 |
|||||||||||||||
|
Add: Acquisition and integration costs |
- |
- |
- |
349 |
349 |
|||||||||||||||
|
Add: Impairment charges |
22,016 |
- |
22,016 |
- |
22,016 |
|||||||||||||||
|
Less: Environmental reserves, net (2) |
- |
- |
- |
(500 |
) |
(500 |
) |
|||||||||||||
|
Adjusted operating income (loss) (1) |
24,298 |
2,351 |
26,649 |
(6,110 |
) |
20,539 |
||||||||||||||
|
Adjusted operating income margin |
16.1 |
% |
4.3 |
% |
13.0 |
% |
n/a |
10.0 |
% |
|||||||||||
|
Add: Depreciation and amortization |
9,158 |
823 |
9,981 |
215 |
10,196 |
|||||||||||||||
|
Adjusted EBITDA |
$ |
33,456 |
$ |
3,174 |
$ |
36,630 |
$ |
(5,895 |
) |
$ |
30,735 |
|||||||||
|
Adjusted EBITDA margin |
22.2 |
% |
5.8 |
% |
17.9 |
% |
n/a |
15.0 |
% |
|||||||||||
|
(1) Includes gross profit adjustments of $1,211, impairment charges of $22,016 and SG&A adjustments of $2,076 |
||||||||||||||||||||
|
(2) Includes environmental charges of $200 net of probable insurance recoveries of $700 |
||||||||||||||||||||
|
Quarter Ended September 30, 2023 |
||||||||||||||||||||
|
Material Handling |
Distribution |
Segment Total |
Corporate & Other |
Total |
||||||||||||||||
|
Net sales |
$ |
132,484 |
$ |
65,335 |
$ |
197,819 |
$ |
(21 |
) |
$ |
197,798 |
|||||||||
|
Net income (loss) |
12,747 |
|||||||||||||||||||
|
Net income margin |
6.4 |
% |
||||||||||||||||||
|
Gross profit |
62,379 |
|||||||||||||||||||
|
Add: Restructuring expenses and other adjustments |
307 |
|||||||||||||||||||
|
Adjusted gross profit |
62,686 |
|||||||||||||||||||
|
Gross margin as adjusted |
31.7 |
% |
||||||||||||||||||
|
Operating income (loss) |
19,978 |
4,993 |
24,971 |
(6,268 |
) |
18,703 |
||||||||||||||
|
Operating income margin |
15.1 |
% |
7.6 |
% |
12.6 |
% |
n/a |
9.5 |
% |
|||||||||||
|
Add: Restructuring expenses and other adjustments |
529 |
674 |
1,203 |
156 |
1,359 |
|||||||||||||||
|
Add: Acquisition and integration costs |
- |
77 |
77 |
- |
77 |
|||||||||||||||
|
Less: Environmental reserves, net (2) |
- |
- |
- |
(100 |
) |
(100 |
) |
|||||||||||||
|
Adjusted operating income (loss) (1) |
20,507 |
5,744 |
26,251 |
(6,212 |
) |
20,039 |
||||||||||||||
|
Adjusted operating income margin |
15.5 |
% |
8.8 |
% |
13.3 |
% |
n/a |
10.1 |
% |
|||||||||||
|
Add: Depreciation and amortization |
4,641 |
842 |
5,483 |
126 |
5,609 |
|||||||||||||||
|
Adjusted EBITDA |
$ |
25,148 |
$ |
6,586 |
$ |
31,734 |
$ |
(6,086 |
) |
$ |
25,648 |
|||||||||
|
Adjusted EBITDA margin |
19.0 |
% |
10.1 |
% |
16.0 |
% |
n/a |
13.0 |
% |
|||||||||||
|
(1) Includes gross profit adjustments of $307 and SG&A adjustments of $1,029 |
||||||||||||||||||||
|
(2) Includes environmental charges of $300 net of probable insurance recoveries of $400 |
|
MYERS INDUSTRIES, INC. |
||||||||||||||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
||||||||||||||||||||
|
GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) |
||||||||||||||||||||
|
(Dollars in thousands) |
||||||||||||||||||||
|
Nine Months Ended September 30, 2024 |
||||||||||||||||||||
|
Material Handling |
Distribution |
Segment Total |
Corporate & Other |
Total |
||||||||||||||||
|
Net sales |
$ |
468,951 |
$ |
163,543 |
$ |
632,494 |
$ |
(89 |
) |
$ |
632,405 |
|||||||||
|
Net income (loss) |
2,904 |
|||||||||||||||||||
|
Net income margin |
0.5 |
% |
||||||||||||||||||
|
Gross profit |
204,916 |
|||||||||||||||||||
|
Add: Restructuring expenses and other adjustments |
4,163 |
|||||||||||||||||||
|
Add: Acquisition-related inventory step-up |
4,457 |
|||||||||||||||||||
|
Adjusted gross profit |
213,536 |
|||||||||||||||||||
|
Gross margin as adjusted |
33.8 |
% |
||||||||||||||||||
|
Operating income (loss) |
51,843 |
4,915 |
56,758 |
(26,915 |
) |
29,843 |
||||||||||||||
|
Operating income margin |
11.1 |
% |
3.0 |
% |
9.0 |
% |
n/a |
4.7 |
% |
|||||||||||
|
Add: Executive severance costs |
- |
- |
- |
1,405 |
1,405 |
|||||||||||||||
|
Add: Restructuring expenses and other adjustments |
3,860 |
975 |
4,835 |
417 |
5,252 |
|||||||||||||||
|
Add: Acquisition and integration costs |
305 |
- |
305 |
4,132 |
4,437 |
|||||||||||||||
|
Add: Acquisition-related inventory step-up |
4,457 |
- |
4,457 |
- |
4,457 |
|||||||||||||||
|
Add: Impairment charges |
22,016 |
- |
22,016 |
- |
22,016 |
|||||||||||||||
|
Less: Insurance recovery of legal fees |
(702 |
) |
- |
(702 |
) |
- |
(702 |
) |
||||||||||||
|
Less: Environmental reserves, net (2) |
- |
- |
- |
(700 |
) |
(700 |
) |
|||||||||||||
|
Adjusted operating income (loss) (1) |
81,779 |
5,890 |
87,669 |
(21,661 |
) |
66,008 |
||||||||||||||
|
Adjusted operating income margin |
17.4 |
% |
3.6 |
% |
13.9 |
% |
n/a |
10.4 |
% |
|||||||||||
|
Add: Depreciation and amortization |
25,706 |
2,426 |
28,132 |
628 |
28,760 |
|||||||||||||||
|
Adjusted EBITDA |
$ |
107,485 |
$ |
8,316 |
$ |
115,801 |
$ |
(21,033 |
) |
$ |
94,768 |
|||||||||
|
Adjusted EBITDA margin |
22.9 |
% |
5.1 |
% |
18.3 |
% |
n/a |
15.0 |
% |
|||||||||||
|
(1) Includes gross profit adjustments of $8,620, impairment charges of $22,016 and SG&A adjustments of $5,529 |
||||||||||||||||||||
|
(2) Includes environmental charges of $1,000 net of probable insurance recoveries of $1,700 |
||||||||||||||||||||
|
Nine Months Ended September 30, 2023 |
||||||||||||||||||||
|
Material Handling |
Distribution |
Segment Total |
Corporate & Other |
Total |
||||||||||||||||
|
Net sales |
$ |
428,341 |
$ |
193,693 |
$ |
622,034 |
$ |
(44 |
) |
$ |
621,990 |
|||||||||
|
Net income (loss) |
36,328 |
|||||||||||||||||||
|
Net income margin |
5.8 |
% |
||||||||||||||||||
|
Gross profit |
201,854 |
|||||||||||||||||||
|
Add: Restructuring expenses and other adjustments |
589 |
|||||||||||||||||||
|
Adjusted gross profit |
202,443 |
|||||||||||||||||||
|
Gross margin as adjusted |
32.5 |
% |
||||||||||||||||||
|
Operating income (loss) |
70,157 |
10,628 |
80,785 |
(26,983 |
) |
53,802 |
||||||||||||||
|
Operating income margin |
16.4 |
% |
5.5 |
% |
13.0 |
% |
n/a |
8.6 |
% |
|||||||||||
|
Add: Restructuring expenses and other adjustments |
1,225 |
853 |
2,078 |
166 |
2,244 |
|||||||||||||||
|
Add: Acquisition and integration costs |
- |
297 |
297 |
126 |
423 |
|||||||||||||||
|
Add: Executive severance costs |
- |
410 |
410 |
289 |
699 |
|||||||||||||||
|
Add: Environmental reserves, net (2) |
- |
- |
- |
2,200 |
2,200 |
|||||||||||||||
|
Adjusted operating income (loss) (1) |
71,382 |
12,188 |
83,570 |
(24,202 |
) |
59,368 |
||||||||||||||
|
Adjusted operating income margin |
16.7 |
% |
6.3 |
% |
13.4 |
% |
n/a |
9.5 |
% |
|||||||||||
|
Add: Depreciation and amortization |
13,995 |
2,505 |
16,500 |
404 |
16,904 |
|||||||||||||||
|
Adjusted EBITDA |
$ |
85,377 |
$ |
14,693 |
$ |
100,070 |
$ |
(23,798 |
) |
$ |
76,272 |
|||||||||
|
Adjusted EBITDA margin |
19.9 |
% |
7.6 |
% |
16.1 |
% |
n/a |
12.3 |
% |
|||||||||||
|
(1) Includes gross profit adjustments of $589 and SG&A adjustments of $4,977 |
||||||||||||||||||||
|
(2) Includes environmental charges of $3,800 net of probable insurance recoveries of $1,600 |
|
MYERS INDUSTRIES, INC. |
||||||||||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
||||||||||||||||
|
ADJUSTED OPERATING INCOME, ADJUSTED EBITDA AND FREE CASH FLOW (UNAUDITED) |
||||||||||||||||
|
(Dollars in thousands) |
||||||||||||||||
|
Quarter Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
|
2024 |
2023 |
2024 |
2023 |
|||||||||||||
|
Adjusted operating income (loss) reconciliation: |
||||||||||||||||
|
Operating income (loss) |
$ |
(4,764 |
) |
$ |
18,703 |
$ |
29,843 |
$ |
53,802 |
|||||||
|
Restructuring expenses and other adjustments |
2,033 |
1,359 |
5,252 |
2,244 |
||||||||||||
|
Acquisition and integration costs |
349 |
77 |
4,437 |
423 |
||||||||||||
|
Acquisition-related inventory step-up |
- |
- |
4,457 |
- |
||||||||||||
|
Impairment charges |
22,016 |
- |
22,016 |
- |
||||||||||||
|
Insurance recovery of legal fees |
- |
- |
(702 |
) |
- |
|||||||||||
|
Executive severance costs |
1,405 |
- |
1,405 |
699 |
||||||||||||
|
Environmental reserves, net |
(500 |
) |
(100 |
) |
(700 |
) |
2,200 |
|||||||||
|
Adjusted operating income (loss) |
$ |
20,539 |
$ |
20,039 |
$ |
66,008 |
$ |
59,368 |
||||||||
|
Adjusted EBITDA reconciliation: |
||||||||||||||||
|
Net income (loss) |
$ |
(10,878 |
) |
$ |
12,747 |
$ |
2,904 |
$ |
36,328 |
|||||||
|
Income tax expense (benefit) |
(1,977 |
) |
4,417 |
3,763 |
12,499 |
|||||||||||
|
Interest expense, net |
8,091 |
1,539 |
23,176 |
4,975 |
||||||||||||
|
Operating income (loss) |
(4,764 |
) |
18,703 |
29,843 |
53,802 |
|||||||||||
|
Depreciation and amortization |
10,196 |
5,609 |
28,760 |
16,904 |
||||||||||||
|
Restructuring expenses and other adjustments |
2,033 |
1,359 |
5,252 |
2,244 |
||||||||||||
|
Acquisition and integration costs |
349 |
77 |
4,437 |
423 |
||||||||||||
|
Acquisition-related inventory step-up |
- |
- |
4,457 |
- |
||||||||||||
|
Impairment charges |
22,016 |
- |
22,016 |
- |
||||||||||||
|
Insurance recovery of legal fees |
- |
- |
(702 |
) |
- |
|||||||||||
|
Executive severance costs |
1,405 |
- |
1,405 |
699 |
||||||||||||
|
Environmental reserves, net |
(500 |
) |
(100 |
) |
(700 |
) |
2,200 |
|||||||||
|
Adjusted EBITDA |
$ |
30,735 |
$ |
25,648 |
$ |
94,768 |
$ |
76,272 |
||||||||
|
Free cash flow reconciliation: |
||||||||||||||||
|
Net cash provided by (used for) operating activities |
$ |
17,327 |
$ |
22,134 |
$ |
51,944 |
$ |
70,772 |
||||||||
|
Capital expenditures |
(7,178 |
) |
(4,076 |
) |
(17,302 |
) |
(19,292 |
) |
||||||||
|
Free cash flow |
$ |
10,149 |
$ |
18,058 |
$ |
34,642 |
$ |
51,480 |
|
MYERS INDUSTRIES, INC. |
||||||||||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
||||||||||||||||
|
ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER DILUTED SHARE (UNAUDITED) |
||||||||||||||||
|
(Dollars in thousands, except per share data) |
||||||||||||||||
|
Quarter Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
|
2024 |
2023 |
2024 |
2023 |
|||||||||||||
|
Adjusted net income (loss) reconciliation: |
||||||||||||||||
|
Net income (loss) |
$ |
(10,878 |
) |
$ |
12,747 |
$ |
2,904 |
$ |
36,328 |
|||||||
|
Income tax expense (benefit) |
(1,977 |
) |
4,417 |
3,763 |
12,499 |
|||||||||||
|
Income (loss) before income taxes |
(12,855 |
) |
17,164 |
6,667 |
48,827 |
|||||||||||
|
Restructuring expenses and other adjustments |
2,033 |
1,359 |
5,252 |
2,244 |
||||||||||||
|
Acquisition and integration costs |
349 |
77 |
4,437 |
423 |
||||||||||||
|
Acquisition-related inventory step-up |
- |
- |
4,457 |
- |
||||||||||||
|
Impairment charges |
22,016 |
- |
22,016 |
- |
||||||||||||
|
Insurance recovery of legal fees |
- |
- |
(702 |
) |
- |
|||||||||||
|
Executive severance costs |
1,405 |
- |
1,405 |
699 |
||||||||||||
|
Environmental reserves, net |
(500 |
) |
(100 |
) |
(700 |
) |
2,200 |
|||||||||
|
Adjusted income (loss) before income taxes |
12,448 |
18,500 |
42,832 |
54,393 |
||||||||||||
|
Income tax expense, as adjusted (1) |
(3,236 |
) |
(4,625 |
) |
(11,136 |
) |
(13,598 |
) |
||||||||
|
Adjusted net income (loss) |
$ |
9,212 |
$ |
13,875 |
$ |
31,696 |
$ |
40,795 |
||||||||
|
Adjusted earnings per diluted share reconciliation: |
||||||||||||||||
|
Net income (loss) per common diluted share |
$ |
(0.29 |
) |
$ |
0.34 |
$ |
0.08 |
$ |
0.98 |
|||||||
|
Restructuring expenses and other adjustments |
0.05 |
0.04 |
0.14 |
0.06 |
||||||||||||
|
Acquisition and integration costs |
0.01 |
0.00 |
0.12 |
0.01 |
||||||||||||
|
Acquisition-related inventory step-up |
- |
- |
0.12 |
- |
||||||||||||
|
Impairment charges |
0.59 |
- |
0.59 |
- |
||||||||||||
|
Insurance recovery of legal fees |
- |
- |
(0.02 |
) |
- |
|||||||||||
|
Executive severance costs |
0.04 |
- |
0.04 |
0.02 |
||||||||||||
|
Environmental reserves, net |
(0.01 |
) |
(0.00 |
) |
(0.02 |
) |
0.06 |
|||||||||
|
Adjusted effective income tax rate impact |
(0.14 |
) |
(0.01 |
) |
(0.20 |
) |
(0.03 |
) |
||||||||
|
Adjusted earnings per diluted share (2) |
$ |
0.25 |
$ |
0.38 |
$ |
0.85 |
$ |
1.10 |
||||||||
|
Items in this table may not recalculate due to rounding |
||||||||||||||||
|
(1) Income taxes are calculated using the normalized effective tax rate for each year. The rate used in 2024 is 26% and in 2023 is 25%. |
||||||||||||||||
|
(2) Adjusted earnings per diluted share is calculated using the weighted average common shares outstanding for the respective period. |
|
MYERS INDUSTRIES, INC. |
|||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||
|
GUIDANCE FOR FULL YEAR ADJUSTED EARNINGS PER DILUTED SHARE |
|||||||
|
(UNAUDITED) |
|||||||
|
Full Year 2024 Guidance |
|||||||
|
Low |
High |
||||||
|
GAAP diluted net income per common share |
$ |
0.11 |
$ |
0.21 |
|||
|
Add: Net restructuring expenses and other adjustments |
0.21 |
0.21 |
|||||
|
Add: Acquisition and integration costs (3) |
0.25 |
0.25 |
|||||
|
Add: Impairment charges |
0.59 |
0.59 |
|||||
|
Add: Executive severance |
0.04 |
0.04 |
|||||
|
Less: Insurance recovery of legal fees |
(0.02 |
) |
(0.02 |
) |
|||
|
Less: Environmental reserves, net |
(0.02 |
) |
(0.02 |
) |
|||
|
Less: Adjusted effective income tax rate impact (1) |
(0.24 |
) |
(0.24 |
) |
|||
|
Adjusted earnings per diluted share (2) |
$ |
0.92 |
$ |
1.02 |
|||
|
(1) Income taxes are calculated using the normalized effective tax rate for each year. The rate used in 2024 is 26%. |
|||||||
|
(2) Adjusted earnings per diluted share is calculated using the weighted average common shares outstanding. |
|||||||
|
(3) Includes acquisition-related inventory step-up costs |
Meghan Beringer, Senior Director Investor Relations, 252-536-5651