Eagle Materials Inc · NYSE:EXP
Eagle Materials — Investor Presentation (May 2024)
19 slides from Eagle Materials's investor presentation, May 29, 2024
Slide 1: Company Overview: Evolution and Outlook
Company Overview Evolution and Outlook 2024 Investor Presentation
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified
Slide 3: Eagle Materials Company Overview
Eagle Materials Company Overview ▪ Founded in 1963 as a subsidiary of Centex Corp. Revenue (FYE March 31, $ in millions) ▪ Completed the IPO in 1994 and stock began $2,148 $2,259 trading $1,862 on the NYSE ▪ In 2004, Centex spun off Centex Construction Products which became Eagle Materials Inc. (NYS
Slide 4: Who We Are
Who We Are We Manufacture Necessities Not Luxuries • Our two major product lines are Portland Operating Earnings + DD&A by Segment cement (“Heavy” materials) and gypsum for FYE Mar-24 ($ in millions) wallboard (“Light” materials), today Gypsum Wallboard proportionately 50/50 $358 • Both building pro
Slide 5: Eagle Materials: Financial Evolution
Eagle Materials: Financial Evolution In Millions, Annual at March Year-End Revenue Operating Earnings + DD&A $2,503 $864 Heavy $579 Light $109 2011 2024 2011 2024 (Trough) (Trough) Through investments and acquisitions, we’ve grown from a Our operating earnings + DD&A have continued to show a balance
Slide 6: Comparative on Peer Profit Margins
Comparative on Peer Profit Margins Pre-Tax Margin % (Latest Fiscal Year) Pre-Tax Margin % (10-Year Average)1 30.0 27.4 30.0 22.0 21.7 20.0 17.8 20.0 15.1 16.0 15.5 13.2 12.8 8.5 8.8 10.0 10.0 4.4 – – Eagle Heavy Peers Light Peers Eagle Heavy Peers Light Peers EBITDA Margin % (Latest Fiscal Year) EBI
Slide 7: Comparative on Peer Return on Capital
Comparative on Peer Return on Capital Return on Equity % (Latest Fiscal Year) Return on Equity % (10-Year Average)1 40.0 38.3 40.0 30.0 30.0 23.6 23.7 20.0 17.4 20.0 15.8 13.1 13.3 11.3 9.7 10.0 7.0 10.0 6.6 7.2 – – Eagle Heavy Peers Light Peers Eagle Heavy Peers Light Peers Return on Invested Capit
Slide 8: Comparative on Peer Cash Flow Metrics
Comparative on Peer Cash Flow Metrics Free Cash Flow Yield % (Latest Fiscal Year) Free Cash Flow Yield % (10-Year Average)1 10.0 10.0 8.0 8.0 6.5 6.0 6.0 5.1 4.7 4.0 3.7 3.6 3.8 4.0 4.0 2.3 2.6 2.2 2.1 2.0 1.4 2.0 – – Eagle Heavy Peers Light Peers Eagle Heavy Peers Light Peers Free Cash Flow Convers
Slide 9: End-Use Applications
End-Use Applications US Building Code and Specification Driven Cement is the essential The water binding material in concrete molecule US End-Use imbedded in which has • Unrivaled strength, durability, Cement Segments Wallboard gypsum longevity and resilience wallboard • Energy efficiency Applicatio
Slide 10: Cement US Heartland System
Cement US Heartland System Strategic Geographic Focus, Manufacturing Away from US Coastlines (Imports) Plants and Capacities1 (ST2 thousands) Texas Lehigh (50%) 720 Illinois Cement 1,100 Mountain Cement 800 Nevada Cement 550 Central Plains Kansas City 1,300 Central Plains Tulsa 900 Fairborn Cement 9
Slide 11: US Cement Consumption and Clinker Capacity
US Cement Consumption and Clinker Capacity Million Metric Tons 120,000 US Clinker Capacity 100,000 New capacity -- and 80,000 capacity expansion -- is constrained due to regulation (NESHAP) 60,000 Imports will be required 40,000 again to meet demand 20,000 0 2018 2019 2020 2021 2022 2023 Public Resi
Slide 12: Gypsum Wallboard and Paperboard System
Gypsum Wallboard and Paperboard System US Sunbelt Strategic Geographic Focus West of Mississippi River Natural Gypsum Gypsum, CO East of Mississippi River 700 MMSF Synthetic Gypsum Duke, OK 1,300 MMSF Albuquerque, NM Georgetown, SC 425 MMSF 900 MMSF Bernalillo, NM Lawton, OK 550 MMSF 390,000 tons pa
Slide 13: Gypsum Wallboard
Gypsum Wallboard Raw Material Constraints Have Impacted Industry Costs and Supply 2,500 Lack of availability of key raw material source for $300 almost 50% of the industry (but not Eagle) has led to: ▪ Steepening of the industry cost curve $250 2,000 ▪ Crimping of existing capacity ▪ Limited ability
Slide 14: Recent Strategic Announcements
Recent Strategic Announcements Growth Investments To Expand our Heavy Materials Footprint Announced two strategic initiatives to achieve further growth in our cement business ▪ $430 million Mountain Cement Expansion and Modernization — Mountain Cement plant modernization and expansion to increase ou
Slide 15: Well-Managed Capital Structure
Well-Managed Capital Structure Net Debt/Adj. EBITDA Below 2x (with Exception of Temporary Increase For the Kosmos Acquisition) Kosmos Acquisition 3.1x Plan was implemented to quickly reduce leverage post-acquisition 1.5x 1.5x 1.4x 1.4x 1.3x 1.3x 1.3x 1.3x FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY23
Slide 16: Eagle Materials Capital Allocation
Eagle Materials Capital Allocation Light-Side $3.2 Billion Over the Last Five Years Improvement ▪ Capital Allocation Priorities Remain Unchanged Heavy-Side Growth and Improvement — Investments in Profitable Strategic Growth Opportunities — Investments to Maintain and Improve Existing Share Repurchas
Slide 17: Appendix
—al Eagle Materials Appendix
Slide 18: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation $ in millions, Fiscal Year Ending March 31 FY 22 FY 23 FY 24 We present Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA to provide more consistent Net Earnings, as reported $ 374 $ 462 $ 478 comparison of operating performanc
Slide 19: Net Debt to Adjusted EBITDA Reconciliation
Net Debt to Adjusted EBITDA Reconciliation $ in millions, Fiscal Year Ending March 31 GAAP does not define “Net Debt” and it should FY 22 FY 23 FY 24 not be considered as an alternative to cash flow or liquidity measures defined by GAAP. We Total debt, excluding debt issuance costs $ 950 $ 1,100 $ 1