Valmont Industries, Inc. · NYSE:VMI
Valmont Industries — Q1 2016 Earnings Presentation
16 slides from Valmont Industries's earnings presentation, 2016
Slide 1: 1Q 2016 Earnings Call Presentation
1Q 2016 Earnings Call Presentation Valmont Industries. Inc. | 2016 Investor Day
Slide 2: Forward-looking Statement Disclosure
Forward-looking Statement Disclosure These slides contain (and the accompanying oral discussion will contain) “forward- looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks. uncertainties and other factors tha
Slide 3: First Quarter Highlights
First Quarter Highlights Benefits of restructuring and other productivity Improvements drive improved earnings despite lower revenues Revenues down 11%; 27% of the decline was foreign currency translation. Operating income rose 8% including $1.1 million negative foreign exchange impact. Oper
Slide 4: Financial Highlights
Financial Highlights Dollars in millions except per share amounts 2015 2016 Percent Change Engineered Support Structures $178.9 $177.0 (0.5%) Utility Support Structures 176.3 144.5 (18.0% Coatings 74.3 68.5 (7.8%) Energy & Mining 88.1 72.4 (17.7%) Irrigation 174.6 158.5 (9.2%) Other 2.2 - Intersegme
Slide 5: Financial Highlights Operating Income
Financial Highlights Operating Income Dollars in millions Operating Operating Increase Operating Operating Income 1Q Income 1Q /Decrease Income Percent Income Percent 2015 2016 1Q 2015 1Q 2016 Engineered Support $9.5 $14.2 48.6% 5.3% 7.9% Structures Utility Support 15.4 14.8 (3.8%) 8.7% 10.2% Struct
Slide 6: Engineered Support Structures
Engineered Support Structures $ in millions Sales Net of Intercompany Activity Revenue Operating Income 2015 Revenue $170.8 $200 $177.9 $15 $14.2 $177.0 Volume 6.7 $150 $9.5 Pricing/Mix (5.9) $10 $100 Acquisitions - $5 $50 Currency Translation (5.6) $- $- 2016 Revenue $166.0 2015 2016 2015 2016 • No
Slide 7: Utility Support Structures
Utility Support Structures $ in millions Sales Net of Intercompany Activity Revenue Operating Income 2015 Revenue $176.1 $200 $176.3 $20 $15.4 Volume (16.5) $144.5 $14.8 $150 $15 Pricing/Mix (15.3) $100 $10 Acquisitions - $50 $5 Currency Translation - $- $- 2016 Revenue $144.3 2015 2016 2015 2016 •
Slide 8: Coatings
Coatings $ in millions Sales Net of Intercompany Activity Revenue Operating Income 2015 Revenue $61.8 $80 $74.4 $15 $68.6 Volume (1.4) $11.0 $11.4 $60 Pricing/Mix (1.1) $10 $40 Acquisitions 1.9 $5 $20 Currency Translation (2.4) $- $- 2016 Revenue $58.8 2015 2016 2015 2016 • Less internal utility and
Slide 9: Energy and Mining
Energy and Mining $ in millions Sales Net of Intercompany Activity Revenue Operating Income 2015 Revenue $88.1 $100 $88.1 $5 $4.4 Volume (9.1) $80 $72.4 $4 Pricing/Mix (2.2) $60 $3 $2.1 Acquisitions - $40 $2 Currency Translation (5.9) $20 $1 $- $- 2016 Revenue $70.8 2015 2016 2015 2016 • Volume chal
Slide 10: Irrigation
Irrigation $ in millions Sales Net of Intercompany Activity Revenue Operating Income 2015 Revenue $172.8 $180 $40 $174.6 Volume (9.6) $30.2 $28.8 $30 Pricing/Mix (0.5) $170 $20 Acquisitions - $160 $158.5 $10 Currency Translation (6.0) $150 $- 2016 Revenue $156.7 2015 2016 2015 2016 • US Net Farm Inc
Slide 11: Free Cash Flow – Improved Over 2015 and > Net Income
Free Cash Flow – Improved Over 2015 and > Net Income Dollars in Millions 2015 2016 Change Net Income $31.5 $34.2 $2.7 Deprec/Amort 23.9 20.6 (3.3) Working Capital Reduction 4.7 16.4 11.7 Other (4.6) 9.3 14.9 Operating CF 55.5 80.5 25.0 CapEx (16.6) (14.0) 2.6 Free Cash Flow $38.9 $66.5 $27.5 • No pe
Slide 12: Balance Sheet – 1Q 2016
Balance Sheet – 1Q 2016 Goal: Maintain Investment-grade rating; Keep Debt/EBITDA from 1.5 to 2.5x 1Q 2016 Actual Credit Rating Free Cash Flow $66.5M Q1 S&P BBB+ Negative Cash At 03/31 $388M ($307 Ex. US) Moody’s Baa3 Stable Total Debt $760M Debt Maturities – in Millions Debt/Adjusted 2.71x Adjusted
Slide 13: Summary – Positive Q1 Comparisons Despite Headwinds
Summary – Positive Q1 Comparisons Despite Positive Q1 Comparisons Despite Headwinds in Irrigation and E&M Improved Profitability and EPS Despite Top-Line Challenges – Positive Effects from Restructuring and Productivity Improvements – Utility segment returned to double-digit operating profit – Goo
Slide 14: Valmont – Recast 2015 Segment Figures by Quarter
Valmont – Recast 2015 Segment Figures by Quarter Valmont – Recast 2015 Unaudited and in 000's For theSegment First Quarter EndedFigures March 28, 2015 Engineered Utility Support Energy & Support Other/ Segment Operating Income Reconciliation Structures Mining Structures Coatings Irrigation Corporate
Slide 15: Valmont – Recast 2015 Segment Figures (Cont.)
Valmont – Recast 2015 Segment Figures (Cont.) Unaudited and in 000's For the Third Quarter Ended Sept. 27, 2015 Valmont – Recast Engineered 2015 Segment Utility Figures (Cont.) Support Energy & Support Other/ Segment Operating Income Reconciliation Structures Mining Structures Coatings Irrigation Co
Slide 16: Valmont – Calculation of Adjusted EBITDA and Leverage Ratio
Valmont – Calculation of Adjusted EBITDA and Leverage Ratio Valmont – Calculation of Adjusted EBITDA and Leverage Ratio Debt Coverage Calculation TTM March 26, 2016 Net earnings attributable to Valmont Industries, Inc. $ 42,347 Interest expense 42,069 Income tax expense 46,761 Depreciation and amort