Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Myers Industries Announces Second Quarter 2024 Results By: Myers Industries, Inc. via Business Wire August 01, 2024 at 07:00 AM EDT Strong Signature Systems performance improves second quarter results Actions taken in the second quarter to reduce costs and leverage productivity gains; executing against previously communicated target of $7M-$9M in annualized cost savings by 2025 Full-year guidance lowered to $1.05 - $1.20 for adjusted earnings per share, primarily due to continued demand pressure in Recreational Vehicle, Marine, and Automotive Aftermarket end markets 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 second quarter ended June 30, 2024. Second Quarter 2024 Financial Highlights Net sales of $220.2 million compared with $208.5 million in the prior-year period Net Income of $10.3 million, compared with $10.6 million in the prior-year period Adjusted EBITDA of $38.9 million, compared with $24.7 million in the prior-year period GAAP gross margin of 34.3%, up 150 basis points versus the prior-year period Adjusted gross margin of 36.1%, up 320 basis points versus the prior-year period GAAP net income per diluted share of $0.28 compared with $0.29 in the prior-year period Adjusted earnings per diluted share of $0.39 compared with $0.35 in the prior-year period Cash flow provided by operations of $14.3 million and free cash flow of $9.9 million Myers Industries President and CEO Mike McGaugh commented, “Our second-quarter results reflect the Company’s first full quarter with Signature Systems. This business is benefiting from worldwide investments in Infrastructure and helped drive both sequential and year-over-year revenue growth and margin expansion. Signature’s performance outpaced the demand headwinds in the Recreational Vehicle (RV), Marine, and Automotive Aftermarket end markets.” “We continue to focus on growing our Storage, Handling & Protection portfolio, most notably our four power brands: Akro-Mils, Buckhorn, Scepter, and Signature Systems. We believe our increased participation in the Military and Infrastructure end markets will provide meaningful growth for our Company over the next several years. At the same time, we are taking actions to reduce costs and increase productivity in the Engineered Solutions and Automotive Aftermarket portfolios. These actions include the consolidation of three distribution centers in our Myers Tire Supply business, as well as today’s announcement of the consolidation of our Atlantic, Iowa, rotational molding facility into our other rotational molding plants in Indiana. We are able to reduce our footprint and reduce our cost structure, due to the productivity gains we’ve achieved. We expect these closures to be completed in 2025 and deliver approximately $5 million in cost savings in 2025 as well. Our ongoing productivity-improvement and cost-reduction initiatives will help us navigate the cyclical demand conditions in the RV, Marine, and Automotive Aftermarket end markets while positioning the Company favorably for when these conditions revert to historical levels of demand.” McGaugh concluded, “As a result of continued trough-like demand conditions in these end markets, we believe it is prudent to lower our full-year adjusted earnings per share guidance to a range of $1.05 to $1.20. Myers’ consistent and disciplined execution of our Three-Horizon strategy and the expansion of our portfolio of branded products enabled us to achieve the highest quarterly adjusted EBITDA margin of the past decade. Despite the near-term demand softness in select end markets, we remain excited about the ongoing transformation of Myers Industries as we execute against our long-term strategy to build a portfolio of businesses with high margin, branded products that Move, Store, and Protect.” Second Quarter 2024 Financial Summary Quarter Ended June 30, (Dollars in thousands, except per share data) 2024 2023 % Inc (Dec) Net sales $220,236 $208,453 5.7% Gross profit $75,517 $68,410 10.4% Gross margin 34.3% 32.8% Operating income $23,728 $16,142 47.0% Net income $10,279 $10,605 (3.1)% Net income per diluted share $0.28 $0.29 (3.4)% Adjusted operating income $28,826 $19,027 51.5% Adjusted net income $14,561 $12,928 12.6% Adjusted earnings per diluted share $0.39 $0.35 11.4% Adjusted EBITDA $38,893 $24,704 57.4% Net sales were $220.2 million, an increase of $11.8 million, or 5.7%, compared with $208.5 million for the second quarter of 2023. The increase in net sales was driven by contributions from the recent acquisition of Signature Systems, partially offset by lower pricing and volumes in both the Material Handling and Distribution segments. Gross profit increased $7.1 million, or 10.4%, to $75.5 million, driven by performance at Signature Systems, favorable product mix and lower material costs, partially offset by lower pricing and volume, as well as adjusting items related to acquisition and restructuring expenses. Gross margin improved 150 basis points to 34.3% compared with 32.8% for the second quarter of 2023. On an adjusted basis, gross profit increased 320 basis points to 36.1% from 32.9%. Selling, general and administrative expenses decreased $0.7 million year-over-year, or 1.3%, to $51.7 million. SG&A as a percentage of sales decreased to 23.5%, compared with 25.8% in the first quarter of 2024 and 25.1% in the same period last year, driven in part by lower incentive compensation accruals, reflecting Myers’ full-year outlook and cost-saving initiatives. Net income per diluted share was $0.28, compared with $0.29 for the second quarter of 2023. Adjusted earnings per diluted share were $0.39, compared with $0.35 for the second quarter of 2023. Second 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 Q2 2024 Results $166.0 $28.7 17.3% $41.5 25.0% Q2 2023 Results $143.3 $24.8 17.3% $29.9 20.8% $ Increase (decrease) vs prior year $22.7 $3.9 $11.6 % Increase (decrease) vs prior year 15.9% 15.6% +0bps 39.0% +420bps Items in this table may not recalculate due to rounding Net sales for the Material Handling segment were $166.0 million, an increase of $22.7 million, or 15.9%, compared with $143.3 million for the second quarter of 2023. Sales from the addition of Signature Systems were partly offset by decreases, primarily in Recreational Vehicle and Marine, but also Food & Beverage and Consumer end markets. Operating income increased 15.6% to $28.7 million, compared with $24.8 million in the second quarter of 2023. Operating income margin of 17.3% was flat compared with the second quarter of 2023. Adjusted EBITDA increased 39.0% to $41.5 million, compared with $29.9 million in the second quarter of 2023. SG&A expenses increased year-over-year, primarily due to incremental SG&A from Signature, partially offset by lower expenses for professional services and incentive compensation. Adjusted EBITDA margin improved by 420 basis points, primarily attributed to the Signature acquisition, partially offset by lower sales volume and pricing in the legacy business. Distribution Net Sales Op Income Op Income Margin Adj EBITDA Adj EBITDA Margin Q2 2024 Results $54.3 $2.2 4.0% $3.8 6.9% Q2 2023 Results $65.2 $3.4 5.2% $4.7 7.2% $ Increase (decrease) vs prior year ($10.9) ($1.2) ($0.9) % Increase (decrease) vs prior year (16.7)% (35.9)% -120bps (20.1)% -30bps Items in this table may not recalculate due to rounding Operating income decreased $1.2 million to $2.2 million, compared with $3.4 million for the second quarter of 2023. Adjusted EBITDA decreased 20.1% to $3.8 million, compared with $4.7 million in the second quarter of 2023. The decrease in operating income and adjusted EBITDA was primarily due to lower volume and pricing, offset partially by favorable sales mix and material costs. SG&A expenses decreased year-over-year, primarily due to lower payroll costs and lower variable selling expenses. The Distribution segment's operating income margin was 4.0% compared with 5.2% for the second quarter of 2023. The Distribution segment’s adjusted EBITDA margin was 6.9%, compared with 7.2% for the second quarter of 2023. The Distribution Segment continues to implement pricing and cost actions to counter cost inflation and improve margin. Balance Sheet & Cash Flow As of June 30, 2024, the Company’s cash on hand totaled $37.3 million. Total debt as of June 30, 2024, was $409.0 million. Under the terms of the Company’s loan agreement, its net leverage ratio was 2.6x and it had $231.4 million of availability under its revolving credit facility as of June 30, 2024. For the second quarter of 2024, cash flow provided by operations was $14.3 million and free cash flow was $9.9 million, compared with cash flow provided by operations of $22.9 million and free cash flow of $16.7 million for the second quarter of 2023. The decrease in free cash flow was driven primarily by increased interest expense and investment in working capital, partially offset by contributions from Signature. Capital expenditures for the second quarter of 2024 were $4.4 million, compared with $6.1 million for the second 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 5% to 10% Net income per diluted share in the range of $0.76 to $0.91 Adjusted earnings per diluted share in the range of $1.05 to $1.20 Capital expenditures in the range 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 Thursday, August 1, 2024, at 8:30 a.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=ca1ab624&confId=68382. 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 Access Code: 408754. 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 Six Months Ended June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023 Net sales $ 220,236 $ 208,453 $ 427,338 $ 424,192 Cost of sales 144,719 140,043 287,552 284,717 Gross profit 75,517 68,410 139,786 139,475 Selling, general and administrative expenses 51,661 52,351 105,118 104,432 (Gain) loss on disposal of fixed assets 128 (83 ) 61 (56 ) Operating income (loss) 23,728 16,142 34,607 35,099 Interest expense, net 9,006 1,790 15,085 3,436 Income (loss) before income taxes 14,722 14,352 19,522 31,663 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Net income (loss) per common share: Basic $ 0.28 $ 0.29 $ 0.37 $ 0.64 Diluted $ 0.28 $ 0.29 $ 0.37 $ 0.64 Weighted average common shares outstanding: Basic 37,179,658 36,761,916 37,043,913 36,663,345 Diluted 37,312,394 36,892,177 37,257,302 36,874,084 MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED) (Dollars in thousands) June 30, 2024 December 31, 2023 Assets Current Assets Cash $ 37,345 $ 30,290 Trade accounts receivable, net 129,775 113,907 Other accounts receivable, net 9,050 14,726 Inventories, net 105,796 90,844 Other current assets 13,577 6,854 Total Current Assets 295,543 256,621 Property, plant, & equipment, net 135,251 107,933 Right of use asset - operating leases 31,751 27,989 Goodwill and intangible assets, net 474,685 140,521 Deferred income taxes 209 209 Other assets 14,194 8,358 Total Assets $ 951,633 $ 541,631 Liabilities & Shareholders' Equity Current Liabilities Accounts payable $ 93,097 $ 79,050 Accrued expenses 44,137 53,523 Operating lease liability - short-term 6,223 5,943 Finance lease liability - short-term 609 593 Long-term debt - current portion 19,603 25,998 Total Current Liabilities 163,669 165,107 Long-term debt 380,450 31,989 Operating lease liability - long-term 25,003 22,352 Finance lease liability - long-term 8,306 8,615 Other liabilities 17,543 12,108 Deferred income taxes 62,110 8,660 Total Shareholders' Equity 294,552 292,800 Total Liabilities & Shareholders' Equity $ 951,633 $ 541,631 MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cash Flows From Operating Activities Net income $ 10,279 $ 10,605 $ 13,782 $ 23,581 Adjustments to reconcile net income to net cash provided by (used for) operating activities Depreciation and amortization 10,067 5,677 18,564 11,295 Amortization of deferred financing costs 544 78 775 156 Amortization of acquisition-related inventory step-up 1,342 — 4,457 — Non-cash stock-based compensation expense (135 ) 2,488 547 4,392 (Gain) loss on disposal of fixed assets 128 (83 ) 61 (56 ) Other 170 3,319 164 2,492 Cash flows provided by (used for) working capital Accounts receivable - trade and other, net 248 11,915 8,212 15,096 Inventories (2,145 ) 4,048 (1,959 ) (4,730 ) Prepaid expenses and other current assets (5,528 ) (5,048 ) (4,643 ) (3,828 ) Accounts payable and accrued expenses (623 ) (10,147 ) (5,343 ) 240 Net cash provided by (used for) operating activities 14,347 22,852 34,617 48,638 Cash Flows From Investing Activities Capital expenditures (4,417 ) (6,125 ) (10,124 ) (15,216 ) Acquisition of business, net of cash acquired 578 — (348,312 ) (160 ) Proceeds from sale of property, plant, and equipment 9 109 84 142 Net cash provided by (used for) investing activities (3,830 ) (6,016 ) (358,352 ) (15,234 ) Cash Flows From Financing Activities Net borrowings (repayments) from revolving credit facility 4,000 (9,800 ) (7,000 ) (15,000 ) Proceeds from Term Loan A — — 400,000 — Repayments of Term Loan A (5,000 ) — (5,000 ) — Repayments of senior unsecured notes — — (38,000 ) — Payments on finance lease (149 ) (129 ) (292 ) (258 ) Cash dividends paid (5,022 ) (5,022 ) (10,367 ) (10,296 ) Proceeds from issuance of common stock 350 437 2,758 1,569 Shares withheld for employee taxes on equity awards (100 ) (34 ) (1,974 ) (2,033 ) Deferred financing fees — — (9,172 ) — Net cash provided by (used for) financing activities (5,921 ) (14,548 ) 330,953 (26,018 ) Foreign exchange rate effect on cash 19 163 (163 ) 167 Net increase (decrease) in cash 4,615 2,451 7,055 7,553 Beginning Cash 32,730 28,241 30,290 23,139 Ending Cash $ 37,345 $ 30,692 $ 37,345 $ 30,692 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, 2024 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 166,008 $ 54,265 $ 220,273 $ (37 ) $ 220,236 Net income 10,279 Net income margin 4.7 % Gross profit 75,517 Add: Restructuring expenses and other adjustments 2,711 Add: Acquisition-related inventory step-up 1,342 Adjusted gross profit 79,570 Gross margin as adjusted 36.1 % Operating income (loss) 28,701 2,179 30,880 (7,152 ) 23,728 Operating income margin 17.3 % 4.0 % 14.0 % n/a 10.8 % Add: Restructuring expenses and other adjustments 2,223 755 2,978 — 2,978 Add: Acquisition and integration costs 207 — 207 471 678 Add: Acquisition-related inventory step-up 1,342 — 1,342 — 1,342 Add: Environmental reserves, net(2) — — — 100 100 Adjusted operating income (loss)(1) 32,473 2,934 35,407 (6,581 ) 28,826 Adjusted operating income margin 19.6 % 5.4 % 16.1 % n/a 13.1 % Add: Depreciation and amortization 9,023 830 9,853 214 10,067 Adjusted EBITDA $ 41,496 $ 3,764 $ 45,260 $ (6,367 ) $ 38,893 Adjusted EBITDA margin 25.0 % 6.9 % 20.5 % n/a 17.7 % (1) Includes gross profit adjustments of $4,053 and SG&A adjustments of $1,045 (2) Includes environmental charges of $800 net of probable insurance recoveries of $700 Quarter Ended June 30, 2023 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 143,295 $ 65,173 $ 208,468 $ (15 ) $ 208,453 Net income 10,605 Net income margin 5.1 % Gross profit 68,410 Add: Restructuring expenses and other adjustments 180 Adjusted gross profit 68,590 Gross margin as adjusted 32.9 % Operating income (loss) 24,828 3,398 28,226 (12,084 ) 16,142 Operating income margin 17.3 % 5.2 % 13.5 % n/a 7.7 % Add: Restructuring expenses and other adjustments 275 — 275 — 275 Add: Acquisition and integration costs — 111 111 — 111 Add: Executive severance costs — 410 410 289 699 Add: Environmental reserves, net(2) — — — 1,800 1,800 Adjusted operating income (loss)(1) 25,103 3,919 29,022 (9,995 ) 19,027 Adjusted operating income margin 17.5 % 6.0 % 13.9 % n/a 9.1 % Add: Depreciation and amortization 4,755 790 5,545 132 5,677 Adjusted EBITDA $ 29,858 $ 4,709 $ 34,567 $ (9,863 ) $ 24,704 Adjusted EBITDA margin 20.8 % 7.2 % 16.6 % n/a 11.9 % (1) Includes gross profit adjustments of $180 and SG&A adjustments of $2,705 (2) Includes environmental charges of $1,900 net of probable insurance recoveries of $100 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) (Dollars in thousands) Six Months Ended June 30, 2024 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 318,233 $ 109,159 $ 427,392 $ (54 ) $ 427,338 Net income 13,782 Net income margin 3.2 % Gross profit 139,786 Add: Restructuring expenses and other adjustments 2,952 Add: Acquisition-related inventory step-up 4,457 Adjusted gross profit 147,195 Gross margin as adjusted 34.4 % Operating income (loss) 50,957 2,784 53,741 (19,134 ) 34,607 Operating income margin 16.0 % 2.6 % 12.6 % n/a 8.1 % Add: Restructuring expenses and other adjustments 2,464 755 3,219 — 3,219 Add: Acquisition and integration costs 305 — 305 3,783 4,088 Add: Acquisition-related inventory step-up 4,457 — 4,457 — 4,457 Less: Insurance recovery of legal fees (702 ) — (702 ) — (702 ) Less: Environmental reserves, net(2) — — — (200 ) (200 ) Adjusted operating income (loss)(1) 57,481 3,539 61,020 (15,551 ) 45,469 Adjusted operating income margin 18.1 % 3.2 % 14.3 % n/a 10.6 % Add: Depreciation and amortization 16,548 1,603 18,151 413 18,564 Adjusted EBITDA $ 74,029 $ 5,142 $ 79,171 $ (15,138 ) $ 64,033 Adjusted EBITDA margin 23.3 % 4.7 % 18.5 % n/a 15.0 % (1) Includes gross profit adjustments of $7,409 and SG&A adjustments of $3,453 (2) Includes environmental charges of $800 net of probable insurance recoveries of $1,000 Six Months Ended June 30, 2023 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 295,857 $ 128,358 $ 424,215 $ (23 ) $ 424,192 Net income 23,581 Net income margin 5.6 % Gross profit 139,475 Add: Restructuring expenses and other adjustments 282 Adjusted gross profit 139,757 Gross margin as adjusted 32.9 % Operating income (loss) 50,179 5,635 55,814 (20,715 ) 35,099 Operating income margin 17.0 % 4.4 % 13.2 % n/a 8.3 % Add: Restructuring expenses and other adjustments 696 179 875 10 885 Add: Acquisition and integration costs — 220 220 126 346 Add: Executive severance costs — 410 410 289 699 Add: Environmental reserves, net(2) — — — 2,300 2,300 Adjusted operating income (loss)(1) 50,875 6,444 57,319 (17,990 ) 39,329 Adjusted operating income margin 17.2 % 5.0 % 13.5 % n/a 9.3 % Add: Depreciation and amortization 9,354 1,663 11,017 278 11,295 Adjusted EBITDA $ 60,229 $ 8,107 $ 68,336 $ (17,712 ) $ 50,624 Adjusted EBITDA margin 20.4 % 6.3 % 16.1 % n/a 11.9 % (1) Includes gross profit adjustments of $282 and SG&A adjustments of $3,948 (2) Includes environmental charges of $3,500 net of probable insurance recoveries of $1,200 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES ADJUSTED OPERATING INCOME, ADJUSTED EBITDA AND FREE CASH FLOW (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Adjusted operating income (loss) reconciliation: Operating income (loss) $ 23,728 $ 16,142 $ 34,607 $ 35,099 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted operating income (loss) $ 28,826 $ 19,027 $ 45,469 $ 39,329 Adjusted EBITDA reconciliation: Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Interest expense, net 9,006 1,790 15,085 3,436 Operating income (loss) 23,728 16,142 34,607 35,099 Depreciation and amortization 10,067 5,677 18,564 11,295 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted EBITDA $ 38,893 $ 24,704 $ 64,033 $ 50,624 Free cash flow reconciliation: Net cash provided by (used for) operating activities $ 14,347 $ 22,852 $ 34,617 $ 48,638 Capital expenditures (4,417 ) (6,125 ) (10,124 ) (15,216 ) Free cash flow $ 9,930 $ 16,727 $ 24,493 $ 33,422 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 June 30, Six Months Ended June 30, 2024 2023 2024 2023 Adjusted net income (loss) reconciliation: Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Income (loss) before income taxes 14,722 14,352 19,522 31,663 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted income (loss) before income taxes 19,820 17,237 30,384 35,893 Income tax expense, as adjusted (1) (5,259 ) (4,309 ) (7,900 ) (8,973 ) Adjusted net income (loss) $ 14,561 $ 12,928 $ 22,484 $ 26,920 Adjusted earnings per diluted share reconciliation: Net income (loss) per common diluted share $ 0.28 $ 0.29 $ 0.37 $ 0.64 Restructuring expenses and other adjustments 0.08 0.00 0.09 0.02 Acquisition and integration costs 0.02 0.00 0.11 0.01 Acquisition-related inventory step-up 0.04 — 0.12 — Insurance recovery of legal fees — — (0.02 ) — Executive severance costs — 0.02 — 0.02 Environmental reserves, net 0.00 0.05 (0.01 ) 0.06 Adjusted effective income tax rate impact (0.03 ) (0.01 ) (0.06 ) (0.02 ) Adjusted earnings per diluted share(2) $ 0.39 $ 0.35 $ 0.60 $ 0.73 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 $ 0.76 $ 0.91 Add: Net restructuring expenses and other adjustments 0.14 0.14 Add: Acquisition and integration costs (3) 0.25 0.25 Less: Insurance recovery of legal fees (0.02 ) (0.02 ) Less: Environmental reserves, net (0.01 ) (0.01 ) Less: Adjusted effective income tax rate impact (1) (0.07 ) (0.07 ) Adjusted earnings per diluted share (2) $ 1.05 $ 1.20 (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 View source version on businesswire.com: https://www.businesswire.com/news/home/20240801624582/en/Contacts Meghan Beringer, Senior Director Investor Relations, 252-536-5651 Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Myers Industries Announces Second Quarter 2024 Results By: Myers Industries, Inc. via Business Wire August 01, 2024 at 07:00 AM EDT Strong Signature Systems performance improves second quarter results Actions taken in the second quarter to reduce costs and leverage productivity gains; executing against previously communicated target of $7M-$9M in annualized cost savings by 2025 Full-year guidance lowered to $1.05 - $1.20 for adjusted earnings per share, primarily due to continued demand pressure in Recreational Vehicle, Marine, and Automotive Aftermarket end markets 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 second quarter ended June 30, 2024. Second Quarter 2024 Financial Highlights Net sales of $220.2 million compared with $208.5 million in the prior-year period Net Income of $10.3 million, compared with $10.6 million in the prior-year period Adjusted EBITDA of $38.9 million, compared with $24.7 million in the prior-year period GAAP gross margin of 34.3%, up 150 basis points versus the prior-year period Adjusted gross margin of 36.1%, up 320 basis points versus the prior-year period GAAP net income per diluted share of $0.28 compared with $0.29 in the prior-year period Adjusted earnings per diluted share of $0.39 compared with $0.35 in the prior-year period Cash flow provided by operations of $14.3 million and free cash flow of $9.9 million Myers Industries President and CEO Mike McGaugh commented, “Our second-quarter results reflect the Company’s first full quarter with Signature Systems. This business is benefiting from worldwide investments in Infrastructure and helped drive both sequential and year-over-year revenue growth and margin expansion. Signature’s performance outpaced the demand headwinds in the Recreational Vehicle (RV), Marine, and Automotive Aftermarket end markets.” “We continue to focus on growing our Storage, Handling & Protection portfolio, most notably our four power brands: Akro-Mils, Buckhorn, Scepter, and Signature Systems. We believe our increased participation in the Military and Infrastructure end markets will provide meaningful growth for our Company over the next several years. At the same time, we are taking actions to reduce costs and increase productivity in the Engineered Solutions and Automotive Aftermarket portfolios. These actions include the consolidation of three distribution centers in our Myers Tire Supply business, as well as today’s announcement of the consolidation of our Atlantic, Iowa, rotational molding facility into our other rotational molding plants in Indiana. We are able to reduce our footprint and reduce our cost structure, due to the productivity gains we’ve achieved. We expect these closures to be completed in 2025 and deliver approximately $5 million in cost savings in 2025 as well. Our ongoing productivity-improvement and cost-reduction initiatives will help us navigate the cyclical demand conditions in the RV, Marine, and Automotive Aftermarket end markets while positioning the Company favorably for when these conditions revert to historical levels of demand.” McGaugh concluded, “As a result of continued trough-like demand conditions in these end markets, we believe it is prudent to lower our full-year adjusted earnings per share guidance to a range of $1.05 to $1.20. Myers’ consistent and disciplined execution of our Three-Horizon strategy and the expansion of our portfolio of branded products enabled us to achieve the highest quarterly adjusted EBITDA margin of the past decade. Despite the near-term demand softness in select end markets, we remain excited about the ongoing transformation of Myers Industries as we execute against our long-term strategy to build a portfolio of businesses with high margin, branded products that Move, Store, and Protect.” Second Quarter 2024 Financial Summary Quarter Ended June 30, (Dollars in thousands, except per share data) 2024 2023 % Inc (Dec) Net sales $220,236 $208,453 5.7% Gross profit $75,517 $68,410 10.4% Gross margin 34.3% 32.8% Operating income $23,728 $16,142 47.0% Net income $10,279 $10,605 (3.1)% Net income per diluted share $0.28 $0.29 (3.4)% Adjusted operating income $28,826 $19,027 51.5% Adjusted net income $14,561 $12,928 12.6% Adjusted earnings per diluted share $0.39 $0.35 11.4% Adjusted EBITDA $38,893 $24,704 57.4% Net sales were $220.2 million, an increase of $11.8 million, or 5.7%, compared with $208.5 million for the second quarter of 2023. The increase in net sales was driven by contributions from the recent acquisition of Signature Systems, partially offset by lower pricing and volumes in both the Material Handling and Distribution segments. Gross profit increased $7.1 million, or 10.4%, to $75.5 million, driven by performance at Signature Systems, favorable product mix and lower material costs, partially offset by lower pricing and volume, as well as adjusting items related to acquisition and restructuring expenses. Gross margin improved 150 basis points to 34.3% compared with 32.8% for the second quarter of 2023. On an adjusted basis, gross profit increased 320 basis points to 36.1% from 32.9%. Selling, general and administrative expenses decreased $0.7 million year-over-year, or 1.3%, to $51.7 million. SG&A as a percentage of sales decreased to 23.5%, compared with 25.8% in the first quarter of 2024 and 25.1% in the same period last year, driven in part by lower incentive compensation accruals, reflecting Myers’ full-year outlook and cost-saving initiatives. Net income per diluted share was $0.28, compared with $0.29 for the second quarter of 2023. Adjusted earnings per diluted share were $0.39, compared with $0.35 for the second quarter of 2023. Second 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 Q2 2024 Results $166.0 $28.7 17.3% $41.5 25.0% Q2 2023 Results $143.3 $24.8 17.3% $29.9 20.8% $ Increase (decrease) vs prior year $22.7 $3.9 $11.6 % Increase (decrease) vs prior year 15.9% 15.6% +0bps 39.0% +420bps Items in this table may not recalculate due to rounding Net sales for the Material Handling segment were $166.0 million, an increase of $22.7 million, or 15.9%, compared with $143.3 million for the second quarter of 2023. Sales from the addition of Signature Systems were partly offset by decreases, primarily in Recreational Vehicle and Marine, but also Food & Beverage and Consumer end markets. Operating income increased 15.6% to $28.7 million, compared with $24.8 million in the second quarter of 2023. Operating income margin of 17.3% was flat compared with the second quarter of 2023. Adjusted EBITDA increased 39.0% to $41.5 million, compared with $29.9 million in the second quarter of 2023. SG&A expenses increased year-over-year, primarily due to incremental SG&A from Signature, partially offset by lower expenses for professional services and incentive compensation. Adjusted EBITDA margin improved by 420 basis points, primarily attributed to the Signature acquisition, partially offset by lower sales volume and pricing in the legacy business. Distribution Net Sales Op Income Op Income Margin Adj EBITDA Adj EBITDA Margin Q2 2024 Results $54.3 $2.2 4.0% $3.8 6.9% Q2 2023 Results $65.2 $3.4 5.2% $4.7 7.2% $ Increase (decrease) vs prior year ($10.9) ($1.2) ($0.9) % Increase (decrease) vs prior year (16.7)% (35.9)% -120bps (20.1)% -30bps Items in this table may not recalculate due to rounding Operating income decreased $1.2 million to $2.2 million, compared with $3.4 million for the second quarter of 2023. Adjusted EBITDA decreased 20.1% to $3.8 million, compared with $4.7 million in the second quarter of 2023. The decrease in operating income and adjusted EBITDA was primarily due to lower volume and pricing, offset partially by favorable sales mix and material costs. SG&A expenses decreased year-over-year, primarily due to lower payroll costs and lower variable selling expenses. The Distribution segment's operating income margin was 4.0% compared with 5.2% for the second quarter of 2023. The Distribution segment’s adjusted EBITDA margin was 6.9%, compared with 7.2% for the second quarter of 2023. The Distribution Segment continues to implement pricing and cost actions to counter cost inflation and improve margin. Balance Sheet & Cash Flow As of June 30, 2024, the Company’s cash on hand totaled $37.3 million. Total debt as of June 30, 2024, was $409.0 million. Under the terms of the Company’s loan agreement, its net leverage ratio was 2.6x and it had $231.4 million of availability under its revolving credit facility as of June 30, 2024. For the second quarter of 2024, cash flow provided by operations was $14.3 million and free cash flow was $9.9 million, compared with cash flow provided by operations of $22.9 million and free cash flow of $16.7 million for the second quarter of 2023. The decrease in free cash flow was driven primarily by increased interest expense and investment in working capital, partially offset by contributions from Signature. Capital expenditures for the second quarter of 2024 were $4.4 million, compared with $6.1 million for the second 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 5% to 10% Net income per diluted share in the range of $0.76 to $0.91 Adjusted earnings per diluted share in the range of $1.05 to $1.20 Capital expenditures in the range 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 Thursday, August 1, 2024, at 8:30 a.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=ca1ab624&confId=68382. 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 Access Code: 408754. 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 Six Months Ended June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023 Net sales $ 220,236 $ 208,453 $ 427,338 $ 424,192 Cost of sales 144,719 140,043 287,552 284,717 Gross profit 75,517 68,410 139,786 139,475 Selling, general and administrative expenses 51,661 52,351 105,118 104,432 (Gain) loss on disposal of fixed assets 128 (83 ) 61 (56 ) Operating income (loss) 23,728 16,142 34,607 35,099 Interest expense, net 9,006 1,790 15,085 3,436 Income (loss) before income taxes 14,722 14,352 19,522 31,663 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Net income (loss) per common share: Basic $ 0.28 $ 0.29 $ 0.37 $ 0.64 Diluted $ 0.28 $ 0.29 $ 0.37 $ 0.64 Weighted average common shares outstanding: Basic 37,179,658 36,761,916 37,043,913 36,663,345 Diluted 37,312,394 36,892,177 37,257,302 36,874,084 MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED) (Dollars in thousands) June 30, 2024 December 31, 2023 Assets Current Assets Cash $ 37,345 $ 30,290 Trade accounts receivable, net 129,775 113,907 Other accounts receivable, net 9,050 14,726 Inventories, net 105,796 90,844 Other current assets 13,577 6,854 Total Current Assets 295,543 256,621 Property, plant, & equipment, net 135,251 107,933 Right of use asset - operating leases 31,751 27,989 Goodwill and intangible assets, net 474,685 140,521 Deferred income taxes 209 209 Other assets 14,194 8,358 Total Assets $ 951,633 $ 541,631 Liabilities & Shareholders' Equity Current Liabilities Accounts payable $ 93,097 $ 79,050 Accrued expenses 44,137 53,523 Operating lease liability - short-term 6,223 5,943 Finance lease liability - short-term 609 593 Long-term debt - current portion 19,603 25,998 Total Current Liabilities 163,669 165,107 Long-term debt 380,450 31,989 Operating lease liability - long-term 25,003 22,352 Finance lease liability - long-term 8,306 8,615 Other liabilities 17,543 12,108 Deferred income taxes 62,110 8,660 Total Shareholders' Equity 294,552 292,800 Total Liabilities & Shareholders' Equity $ 951,633 $ 541,631 MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cash Flows From Operating Activities Net income $ 10,279 $ 10,605 $ 13,782 $ 23,581 Adjustments to reconcile net income to net cash provided by (used for) operating activities Depreciation and amortization 10,067 5,677 18,564 11,295 Amortization of deferred financing costs 544 78 775 156 Amortization of acquisition-related inventory step-up 1,342 — 4,457 — Non-cash stock-based compensation expense (135 ) 2,488 547 4,392 (Gain) loss on disposal of fixed assets 128 (83 ) 61 (56 ) Other 170 3,319 164 2,492 Cash flows provided by (used for) working capital Accounts receivable - trade and other, net 248 11,915 8,212 15,096 Inventories (2,145 ) 4,048 (1,959 ) (4,730 ) Prepaid expenses and other current assets (5,528 ) (5,048 ) (4,643 ) (3,828 ) Accounts payable and accrued expenses (623 ) (10,147 ) (5,343 ) 240 Net cash provided by (used for) operating activities 14,347 22,852 34,617 48,638 Cash Flows From Investing Activities Capital expenditures (4,417 ) (6,125 ) (10,124 ) (15,216 ) Acquisition of business, net of cash acquired 578 — (348,312 ) (160 ) Proceeds from sale of property, plant, and equipment 9 109 84 142 Net cash provided by (used for) investing activities (3,830 ) (6,016 ) (358,352 ) (15,234 ) Cash Flows From Financing Activities Net borrowings (repayments) from revolving credit facility 4,000 (9,800 ) (7,000 ) (15,000 ) Proceeds from Term Loan A — — 400,000 — Repayments of Term Loan A (5,000 ) — (5,000 ) — Repayments of senior unsecured notes — — (38,000 ) — Payments on finance lease (149 ) (129 ) (292 ) (258 ) Cash dividends paid (5,022 ) (5,022 ) (10,367 ) (10,296 ) Proceeds from issuance of common stock 350 437 2,758 1,569 Shares withheld for employee taxes on equity awards (100 ) (34 ) (1,974 ) (2,033 ) Deferred financing fees — — (9,172 ) — Net cash provided by (used for) financing activities (5,921 ) (14,548 ) 330,953 (26,018 ) Foreign exchange rate effect on cash 19 163 (163 ) 167 Net increase (decrease) in cash 4,615 2,451 7,055 7,553 Beginning Cash 32,730 28,241 30,290 23,139 Ending Cash $ 37,345 $ 30,692 $ 37,345 $ 30,692 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, 2024 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 166,008 $ 54,265 $ 220,273 $ (37 ) $ 220,236 Net income 10,279 Net income margin 4.7 % Gross profit 75,517 Add: Restructuring expenses and other adjustments 2,711 Add: Acquisition-related inventory step-up 1,342 Adjusted gross profit 79,570 Gross margin as adjusted 36.1 % Operating income (loss) 28,701 2,179 30,880 (7,152 ) 23,728 Operating income margin 17.3 % 4.0 % 14.0 % n/a 10.8 % Add: Restructuring expenses and other adjustments 2,223 755 2,978 — 2,978 Add: Acquisition and integration costs 207 — 207 471 678 Add: Acquisition-related inventory step-up 1,342 — 1,342 — 1,342 Add: Environmental reserves, net(2) — — — 100 100 Adjusted operating income (loss)(1) 32,473 2,934 35,407 (6,581 ) 28,826 Adjusted operating income margin 19.6 % 5.4 % 16.1 % n/a 13.1 % Add: Depreciation and amortization 9,023 830 9,853 214 10,067 Adjusted EBITDA $ 41,496 $ 3,764 $ 45,260 $ (6,367 ) $ 38,893 Adjusted EBITDA margin 25.0 % 6.9 % 20.5 % n/a 17.7 % (1) Includes gross profit adjustments of $4,053 and SG&A adjustments of $1,045 (2) Includes environmental charges of $800 net of probable insurance recoveries of $700 Quarter Ended June 30, 2023 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 143,295 $ 65,173 $ 208,468 $ (15 ) $ 208,453 Net income 10,605 Net income margin 5.1 % Gross profit 68,410 Add: Restructuring expenses and other adjustments 180 Adjusted gross profit 68,590 Gross margin as adjusted 32.9 % Operating income (loss) 24,828 3,398 28,226 (12,084 ) 16,142 Operating income margin 17.3 % 5.2 % 13.5 % n/a 7.7 % Add: Restructuring expenses and other adjustments 275 — 275 — 275 Add: Acquisition and integration costs — 111 111 — 111 Add: Executive severance costs — 410 410 289 699 Add: Environmental reserves, net(2) — — — 1,800 1,800 Adjusted operating income (loss)(1) 25,103 3,919 29,022 (9,995 ) 19,027 Adjusted operating income margin 17.5 % 6.0 % 13.9 % n/a 9.1 % Add: Depreciation and amortization 4,755 790 5,545 132 5,677 Adjusted EBITDA $ 29,858 $ 4,709 $ 34,567 $ (9,863 ) $ 24,704 Adjusted EBITDA margin 20.8 % 7.2 % 16.6 % n/a 11.9 % (1) Includes gross profit adjustments of $180 and SG&A adjustments of $2,705 (2) Includes environmental charges of $1,900 net of probable insurance recoveries of $100 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) (Dollars in thousands) Six Months Ended June 30, 2024 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 318,233 $ 109,159 $ 427,392 $ (54 ) $ 427,338 Net income 13,782 Net income margin 3.2 % Gross profit 139,786 Add: Restructuring expenses and other adjustments 2,952 Add: Acquisition-related inventory step-up 4,457 Adjusted gross profit 147,195 Gross margin as adjusted 34.4 % Operating income (loss) 50,957 2,784 53,741 (19,134 ) 34,607 Operating income margin 16.0 % 2.6 % 12.6 % n/a 8.1 % Add: Restructuring expenses and other adjustments 2,464 755 3,219 — 3,219 Add: Acquisition and integration costs 305 — 305 3,783 4,088 Add: Acquisition-related inventory step-up 4,457 — 4,457 — 4,457 Less: Insurance recovery of legal fees (702 ) — (702 ) — (702 ) Less: Environmental reserves, net(2) — — — (200 ) (200 ) Adjusted operating income (loss)(1) 57,481 3,539 61,020 (15,551 ) 45,469 Adjusted operating income margin 18.1 % 3.2 % 14.3 % n/a 10.6 % Add: Depreciation and amortization 16,548 1,603 18,151 413 18,564 Adjusted EBITDA $ 74,029 $ 5,142 $ 79,171 $ (15,138 ) $ 64,033 Adjusted EBITDA margin 23.3 % 4.7 % 18.5 % n/a 15.0 % (1) Includes gross profit adjustments of $7,409 and SG&A adjustments of $3,453 (2) Includes environmental charges of $800 net of probable insurance recoveries of $1,000 Six Months Ended June 30, 2023 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 295,857 $ 128,358 $ 424,215 $ (23 ) $ 424,192 Net income 23,581 Net income margin 5.6 % Gross profit 139,475 Add: Restructuring expenses and other adjustments 282 Adjusted gross profit 139,757 Gross margin as adjusted 32.9 % Operating income (loss) 50,179 5,635 55,814 (20,715 ) 35,099 Operating income margin 17.0 % 4.4 % 13.2 % n/a 8.3 % Add: Restructuring expenses and other adjustments 696 179 875 10 885 Add: Acquisition and integration costs — 220 220 126 346 Add: Executive severance costs — 410 410 289 699 Add: Environmental reserves, net(2) — — — 2,300 2,300 Adjusted operating income (loss)(1) 50,875 6,444 57,319 (17,990 ) 39,329 Adjusted operating income margin 17.2 % 5.0 % 13.5 % n/a 9.3 % Add: Depreciation and amortization 9,354 1,663 11,017 278 11,295 Adjusted EBITDA $ 60,229 $ 8,107 $ 68,336 $ (17,712 ) $ 50,624 Adjusted EBITDA margin 20.4 % 6.3 % 16.1 % n/a 11.9 % (1) Includes gross profit adjustments of $282 and SG&A adjustments of $3,948 (2) Includes environmental charges of $3,500 net of probable insurance recoveries of $1,200 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES ADJUSTED OPERATING INCOME, ADJUSTED EBITDA AND FREE CASH FLOW (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Adjusted operating income (loss) reconciliation: Operating income (loss) $ 23,728 $ 16,142 $ 34,607 $ 35,099 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted operating income (loss) $ 28,826 $ 19,027 $ 45,469 $ 39,329 Adjusted EBITDA reconciliation: Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Interest expense, net 9,006 1,790 15,085 3,436 Operating income (loss) 23,728 16,142 34,607 35,099 Depreciation and amortization 10,067 5,677 18,564 11,295 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted EBITDA $ 38,893 $ 24,704 $ 64,033 $ 50,624 Free cash flow reconciliation: Net cash provided by (used for) operating activities $ 14,347 $ 22,852 $ 34,617 $ 48,638 Capital expenditures (4,417 ) (6,125 ) (10,124 ) (15,216 ) Free cash flow $ 9,930 $ 16,727 $ 24,493 $ 33,422 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 June 30, Six Months Ended June 30, 2024 2023 2024 2023 Adjusted net income (loss) reconciliation: Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Income (loss) before income taxes 14,722 14,352 19,522 31,663 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted income (loss) before income taxes 19,820 17,237 30,384 35,893 Income tax expense, as adjusted (1) (5,259 ) (4,309 ) (7,900 ) (8,973 ) Adjusted net income (loss) $ 14,561 $ 12,928 $ 22,484 $ 26,920 Adjusted earnings per diluted share reconciliation: Net income (loss) per common diluted share $ 0.28 $ 0.29 $ 0.37 $ 0.64 Restructuring expenses and other adjustments 0.08 0.00 0.09 0.02 Acquisition and integration costs 0.02 0.00 0.11 0.01 Acquisition-related inventory step-up 0.04 — 0.12 — Insurance recovery of legal fees — — (0.02 ) — Executive severance costs — 0.02 — 0.02 Environmental reserves, net 0.00 0.05 (0.01 ) 0.06 Adjusted effective income tax rate impact (0.03 ) (0.01 ) (0.06 ) (0.02 ) Adjusted earnings per diluted share(2) $ 0.39 $ 0.35 $ 0.60 $ 0.73 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 $ 0.76 $ 0.91 Add: Net restructuring expenses and other adjustments 0.14 0.14 Add: Acquisition and integration costs (3) 0.25 0.25 Less: Insurance recovery of legal fees (0.02 ) (0.02 ) Less: Environmental reserves, net (0.01 ) (0.01 ) Less: Adjusted effective income tax rate impact (1) (0.07 ) (0.07 ) Adjusted earnings per diluted share (2) $ 1.05 $ 1.20 (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 View source version on businesswire.com: https://www.businesswire.com/news/home/20240801624582/en/Contacts Meghan Beringer, Senior Director Investor Relations, 252-536-5651
Strong Signature Systems performance improves second quarter results Actions taken in the second quarter to reduce costs and leverage productivity gains; executing against previously communicated target of $7M-$9M in annualized cost savings by 2025 Full-year guidance lowered to $1.05 - $1.20 for adjusted earnings per share, primarily due to continued demand pressure in Recreational Vehicle, Marine, and Automotive Aftermarket end markets
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 second quarter ended June 30, 2024. Second Quarter 2024 Financial Highlights Net sales of $220.2 million compared with $208.5 million in the prior-year period Net Income of $10.3 million, compared with $10.6 million in the prior-year period Adjusted EBITDA of $38.9 million, compared with $24.7 million in the prior-year period GAAP gross margin of 34.3%, up 150 basis points versus the prior-year period Adjusted gross margin of 36.1%, up 320 basis points versus the prior-year period GAAP net income per diluted share of $0.28 compared with $0.29 in the prior-year period Adjusted earnings per diluted share of $0.39 compared with $0.35 in the prior-year period Cash flow provided by operations of $14.3 million and free cash flow of $9.9 million Myers Industries President and CEO Mike McGaugh commented, “Our second-quarter results reflect the Company’s first full quarter with Signature Systems. This business is benefiting from worldwide investments in Infrastructure and helped drive both sequential and year-over-year revenue growth and margin expansion. Signature’s performance outpaced the demand headwinds in the Recreational Vehicle (RV), Marine, and Automotive Aftermarket end markets.” “We continue to focus on growing our Storage, Handling & Protection portfolio, most notably our four power brands: Akro-Mils, Buckhorn, Scepter, and Signature Systems. We believe our increased participation in the Military and Infrastructure end markets will provide meaningful growth for our Company over the next several years. At the same time, we are taking actions to reduce costs and increase productivity in the Engineered Solutions and Automotive Aftermarket portfolios. These actions include the consolidation of three distribution centers in our Myers Tire Supply business, as well as today’s announcement of the consolidation of our Atlantic, Iowa, rotational molding facility into our other rotational molding plants in Indiana. We are able to reduce our footprint and reduce our cost structure, due to the productivity gains we’ve achieved. We expect these closures to be completed in 2025 and deliver approximately $5 million in cost savings in 2025 as well. Our ongoing productivity-improvement and cost-reduction initiatives will help us navigate the cyclical demand conditions in the RV, Marine, and Automotive Aftermarket end markets while positioning the Company favorably for when these conditions revert to historical levels of demand.” McGaugh concluded, “As a result of continued trough-like demand conditions in these end markets, we believe it is prudent to lower our full-year adjusted earnings per share guidance to a range of $1.05 to $1.20. Myers’ consistent and disciplined execution of our Three-Horizon strategy and the expansion of our portfolio of branded products enabled us to achieve the highest quarterly adjusted EBITDA margin of the past decade. Despite the near-term demand softness in select end markets, we remain excited about the ongoing transformation of Myers Industries as we execute against our long-term strategy to build a portfolio of businesses with high margin, branded products that Move, Store, and Protect.” Second Quarter 2024 Financial Summary Quarter Ended June 30, (Dollars in thousands, except per share data) 2024 2023 % Inc (Dec) Net sales $220,236 $208,453 5.7% Gross profit $75,517 $68,410 10.4% Gross margin 34.3% 32.8% Operating income $23,728 $16,142 47.0% Net income $10,279 $10,605 (3.1)% Net income per diluted share $0.28 $0.29 (3.4)% Adjusted operating income $28,826 $19,027 51.5% Adjusted net income $14,561 $12,928 12.6% Adjusted earnings per diluted share $0.39 $0.35 11.4% Adjusted EBITDA $38,893 $24,704 57.4% Net sales were $220.2 million, an increase of $11.8 million, or 5.7%, compared with $208.5 million for the second quarter of 2023. The increase in net sales was driven by contributions from the recent acquisition of Signature Systems, partially offset by lower pricing and volumes in both the Material Handling and Distribution segments. Gross profit increased $7.1 million, or 10.4%, to $75.5 million, driven by performance at Signature Systems, favorable product mix and lower material costs, partially offset by lower pricing and volume, as well as adjusting items related to acquisition and restructuring expenses. Gross margin improved 150 basis points to 34.3% compared with 32.8% for the second quarter of 2023. On an adjusted basis, gross profit increased 320 basis points to 36.1% from 32.9%. Selling, general and administrative expenses decreased $0.7 million year-over-year, or 1.3%, to $51.7 million. SG&A as a percentage of sales decreased to 23.5%, compared with 25.8% in the first quarter of 2024 and 25.1% in the same period last year, driven in part by lower incentive compensation accruals, reflecting Myers’ full-year outlook and cost-saving initiatives. Net income per diluted share was $0.28, compared with $0.29 for the second quarter of 2023. Adjusted earnings per diluted share were $0.39, compared with $0.35 for the second quarter of 2023. Second 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 Q2 2024 Results $166.0 $28.7 17.3% $41.5 25.0% Q2 2023 Results $143.3 $24.8 17.3% $29.9 20.8% $ Increase (decrease) vs prior year $22.7 $3.9 $11.6 % Increase (decrease) vs prior year 15.9% 15.6% +0bps 39.0% +420bps Items in this table may not recalculate due to rounding Net sales for the Material Handling segment were $166.0 million, an increase of $22.7 million, or 15.9%, compared with $143.3 million for the second quarter of 2023. Sales from the addition of Signature Systems were partly offset by decreases, primarily in Recreational Vehicle and Marine, but also Food & Beverage and Consumer end markets. Operating income increased 15.6% to $28.7 million, compared with $24.8 million in the second quarter of 2023. Operating income margin of 17.3% was flat compared with the second quarter of 2023. Adjusted EBITDA increased 39.0% to $41.5 million, compared with $29.9 million in the second quarter of 2023. SG&A expenses increased year-over-year, primarily due to incremental SG&A from Signature, partially offset by lower expenses for professional services and incentive compensation. Adjusted EBITDA margin improved by 420 basis points, primarily attributed to the Signature acquisition, partially offset by lower sales volume and pricing in the legacy business. Distribution Net Sales Op Income Op Income Margin Adj EBITDA Adj EBITDA Margin Q2 2024 Results $54.3 $2.2 4.0% $3.8 6.9% Q2 2023 Results $65.2 $3.4 5.2% $4.7 7.2% $ Increase (decrease) vs prior year ($10.9) ($1.2) ($0.9) % Increase (decrease) vs prior year (16.7)% (35.9)% -120bps (20.1)% -30bps Items in this table may not recalculate due to rounding Operating income decreased $1.2 million to $2.2 million, compared with $3.4 million for the second quarter of 2023. Adjusted EBITDA decreased 20.1% to $3.8 million, compared with $4.7 million in the second quarter of 2023. The decrease in operating income and adjusted EBITDA was primarily due to lower volume and pricing, offset partially by favorable sales mix and material costs. SG&A expenses decreased year-over-year, primarily due to lower payroll costs and lower variable selling expenses. The Distribution segment's operating income margin was 4.0% compared with 5.2% for the second quarter of 2023. The Distribution segment’s adjusted EBITDA margin was 6.9%, compared with 7.2% for the second quarter of 2023. The Distribution Segment continues to implement pricing and cost actions to counter cost inflation and improve margin. Balance Sheet & Cash Flow As of June 30, 2024, the Company’s cash on hand totaled $37.3 million. Total debt as of June 30, 2024, was $409.0 million. Under the terms of the Company’s loan agreement, its net leverage ratio was 2.6x and it had $231.4 million of availability under its revolving credit facility as of June 30, 2024. For the second quarter of 2024, cash flow provided by operations was $14.3 million and free cash flow was $9.9 million, compared with cash flow provided by operations of $22.9 million and free cash flow of $16.7 million for the second quarter of 2023. The decrease in free cash flow was driven primarily by increased interest expense and investment in working capital, partially offset by contributions from Signature. Capital expenditures for the second quarter of 2024 were $4.4 million, compared with $6.1 million for the second 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 5% to 10% Net income per diluted share in the range of $0.76 to $0.91 Adjusted earnings per diluted share in the range of $1.05 to $1.20 Capital expenditures in the range 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 Thursday, August 1, 2024, at 8:30 a.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=ca1ab624&confId=68382. 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 Access Code: 408754. 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 Six Months Ended June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023 Net sales $ 220,236 $ 208,453 $ 427,338 $ 424,192 Cost of sales 144,719 140,043 287,552 284,717 Gross profit 75,517 68,410 139,786 139,475 Selling, general and administrative expenses 51,661 52,351 105,118 104,432 (Gain) loss on disposal of fixed assets 128 (83 ) 61 (56 ) Operating income (loss) 23,728 16,142 34,607 35,099 Interest expense, net 9,006 1,790 15,085 3,436 Income (loss) before income taxes 14,722 14,352 19,522 31,663 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Net income (loss) per common share: Basic $ 0.28 $ 0.29 $ 0.37 $ 0.64 Diluted $ 0.28 $ 0.29 $ 0.37 $ 0.64 Weighted average common shares outstanding: Basic 37,179,658 36,761,916 37,043,913 36,663,345 Diluted 37,312,394 36,892,177 37,257,302 36,874,084 MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED) (Dollars in thousands) June 30, 2024 December 31, 2023 Assets Current Assets Cash $ 37,345 $ 30,290 Trade accounts receivable, net 129,775 113,907 Other accounts receivable, net 9,050 14,726 Inventories, net 105,796 90,844 Other current assets 13,577 6,854 Total Current Assets 295,543 256,621 Property, plant, & equipment, net 135,251 107,933 Right of use asset - operating leases 31,751 27,989 Goodwill and intangible assets, net 474,685 140,521 Deferred income taxes 209 209 Other assets 14,194 8,358 Total Assets $ 951,633 $ 541,631 Liabilities & Shareholders' Equity Current Liabilities Accounts payable $ 93,097 $ 79,050 Accrued expenses 44,137 53,523 Operating lease liability - short-term 6,223 5,943 Finance lease liability - short-term 609 593 Long-term debt - current portion 19,603 25,998 Total Current Liabilities 163,669 165,107 Long-term debt 380,450 31,989 Operating lease liability - long-term 25,003 22,352 Finance lease liability - long-term 8,306 8,615 Other liabilities 17,543 12,108 Deferred income taxes 62,110 8,660 Total Shareholders' Equity 294,552 292,800 Total Liabilities & Shareholders' Equity $ 951,633 $ 541,631 MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Cash Flows From Operating Activities Net income $ 10,279 $ 10,605 $ 13,782 $ 23,581 Adjustments to reconcile net income to net cash provided by (used for) operating activities Depreciation and amortization 10,067 5,677 18,564 11,295 Amortization of deferred financing costs 544 78 775 156 Amortization of acquisition-related inventory step-up 1,342 — 4,457 — Non-cash stock-based compensation expense (135 ) 2,488 547 4,392 (Gain) loss on disposal of fixed assets 128 (83 ) 61 (56 ) Other 170 3,319 164 2,492 Cash flows provided by (used for) working capital Accounts receivable - trade and other, net 248 11,915 8,212 15,096 Inventories (2,145 ) 4,048 (1,959 ) (4,730 ) Prepaid expenses and other current assets (5,528 ) (5,048 ) (4,643 ) (3,828 ) Accounts payable and accrued expenses (623 ) (10,147 ) (5,343 ) 240 Net cash provided by (used for) operating activities 14,347 22,852 34,617 48,638 Cash Flows From Investing Activities Capital expenditures (4,417 ) (6,125 ) (10,124 ) (15,216 ) Acquisition of business, net of cash acquired 578 — (348,312 ) (160 ) Proceeds from sale of property, plant, and equipment 9 109 84 142 Net cash provided by (used for) investing activities (3,830 ) (6,016 ) (358,352 ) (15,234 ) Cash Flows From Financing Activities Net borrowings (repayments) from revolving credit facility 4,000 (9,800 ) (7,000 ) (15,000 ) Proceeds from Term Loan A — — 400,000 — Repayments of Term Loan A (5,000 ) — (5,000 ) — Repayments of senior unsecured notes — — (38,000 ) — Payments on finance lease (149 ) (129 ) (292 ) (258 ) Cash dividends paid (5,022 ) (5,022 ) (10,367 ) (10,296 ) Proceeds from issuance of common stock 350 437 2,758 1,569 Shares withheld for employee taxes on equity awards (100 ) (34 ) (1,974 ) (2,033 ) Deferred financing fees — — (9,172 ) — Net cash provided by (used for) financing activities (5,921 ) (14,548 ) 330,953 (26,018 ) Foreign exchange rate effect on cash 19 163 (163 ) 167 Net increase (decrease) in cash 4,615 2,451 7,055 7,553 Beginning Cash 32,730 28,241 30,290 23,139 Ending Cash $ 37,345 $ 30,692 $ 37,345 $ 30,692 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, 2024 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 166,008 $ 54,265 $ 220,273 $ (37 ) $ 220,236 Net income 10,279 Net income margin 4.7 % Gross profit 75,517 Add: Restructuring expenses and other adjustments 2,711 Add: Acquisition-related inventory step-up 1,342 Adjusted gross profit 79,570 Gross margin as adjusted 36.1 % Operating income (loss) 28,701 2,179 30,880 (7,152 ) 23,728 Operating income margin 17.3 % 4.0 % 14.0 % n/a 10.8 % Add: Restructuring expenses and other adjustments 2,223 755 2,978 — 2,978 Add: Acquisition and integration costs 207 — 207 471 678 Add: Acquisition-related inventory step-up 1,342 — 1,342 — 1,342 Add: Environmental reserves, net(2) — — — 100 100 Adjusted operating income (loss)(1) 32,473 2,934 35,407 (6,581 ) 28,826 Adjusted operating income margin 19.6 % 5.4 % 16.1 % n/a 13.1 % Add: Depreciation and amortization 9,023 830 9,853 214 10,067 Adjusted EBITDA $ 41,496 $ 3,764 $ 45,260 $ (6,367 ) $ 38,893 Adjusted EBITDA margin 25.0 % 6.9 % 20.5 % n/a 17.7 % (1) Includes gross profit adjustments of $4,053 and SG&A adjustments of $1,045 (2) Includes environmental charges of $800 net of probable insurance recoveries of $700 Quarter Ended June 30, 2023 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 143,295 $ 65,173 $ 208,468 $ (15 ) $ 208,453 Net income 10,605 Net income margin 5.1 % Gross profit 68,410 Add: Restructuring expenses and other adjustments 180 Adjusted gross profit 68,590 Gross margin as adjusted 32.9 % Operating income (loss) 24,828 3,398 28,226 (12,084 ) 16,142 Operating income margin 17.3 % 5.2 % 13.5 % n/a 7.7 % Add: Restructuring expenses and other adjustments 275 — 275 — 275 Add: Acquisition and integration costs — 111 111 — 111 Add: Executive severance costs — 410 410 289 699 Add: Environmental reserves, net(2) — — — 1,800 1,800 Adjusted operating income (loss)(1) 25,103 3,919 29,022 (9,995 ) 19,027 Adjusted operating income margin 17.5 % 6.0 % 13.9 % n/a 9.1 % Add: Depreciation and amortization 4,755 790 5,545 132 5,677 Adjusted EBITDA $ 29,858 $ 4,709 $ 34,567 $ (9,863 ) $ 24,704 Adjusted EBITDA margin 20.8 % 7.2 % 16.6 % n/a 11.9 % (1) Includes gross profit adjustments of $180 and SG&A adjustments of $2,705 (2) Includes environmental charges of $1,900 net of probable insurance recoveries of $100 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) (Dollars in thousands) Six Months Ended June 30, 2024 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 318,233 $ 109,159 $ 427,392 $ (54 ) $ 427,338 Net income 13,782 Net income margin 3.2 % Gross profit 139,786 Add: Restructuring expenses and other adjustments 2,952 Add: Acquisition-related inventory step-up 4,457 Adjusted gross profit 147,195 Gross margin as adjusted 34.4 % Operating income (loss) 50,957 2,784 53,741 (19,134 ) 34,607 Operating income margin 16.0 % 2.6 % 12.6 % n/a 8.1 % Add: Restructuring expenses and other adjustments 2,464 755 3,219 — 3,219 Add: Acquisition and integration costs 305 — 305 3,783 4,088 Add: Acquisition-related inventory step-up 4,457 — 4,457 — 4,457 Less: Insurance recovery of legal fees (702 ) — (702 ) — (702 ) Less: Environmental reserves, net(2) — — — (200 ) (200 ) Adjusted operating income (loss)(1) 57,481 3,539 61,020 (15,551 ) 45,469 Adjusted operating income margin 18.1 % 3.2 % 14.3 % n/a 10.6 % Add: Depreciation and amortization 16,548 1,603 18,151 413 18,564 Adjusted EBITDA $ 74,029 $ 5,142 $ 79,171 $ (15,138 ) $ 64,033 Adjusted EBITDA margin 23.3 % 4.7 % 18.5 % n/a 15.0 % (1) Includes gross profit adjustments of $7,409 and SG&A adjustments of $3,453 (2) Includes environmental charges of $800 net of probable insurance recoveries of $1,000 Six Months Ended June 30, 2023 Material Handling Distribution Segment Total Corporate & Other Total Net sales $ 295,857 $ 128,358 $ 424,215 $ (23 ) $ 424,192 Net income 23,581 Net income margin 5.6 % Gross profit 139,475 Add: Restructuring expenses and other adjustments 282 Adjusted gross profit 139,757 Gross margin as adjusted 32.9 % Operating income (loss) 50,179 5,635 55,814 (20,715 ) 35,099 Operating income margin 17.0 % 4.4 % 13.2 % n/a 8.3 % Add: Restructuring expenses and other adjustments 696 179 875 10 885 Add: Acquisition and integration costs — 220 220 126 346 Add: Executive severance costs — 410 410 289 699 Add: Environmental reserves, net(2) — — — 2,300 2,300 Adjusted operating income (loss)(1) 50,875 6,444 57,319 (17,990 ) 39,329 Adjusted operating income margin 17.2 % 5.0 % 13.5 % n/a 9.3 % Add: Depreciation and amortization 9,354 1,663 11,017 278 11,295 Adjusted EBITDA $ 60,229 $ 8,107 $ 68,336 $ (17,712 ) $ 50,624 Adjusted EBITDA margin 20.4 % 6.3 % 16.1 % n/a 11.9 % (1) Includes gross profit adjustments of $282 and SG&A adjustments of $3,948 (2) Includes environmental charges of $3,500 net of probable insurance recoveries of $1,200 MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES ADJUSTED OPERATING INCOME, ADJUSTED EBITDA AND FREE CASH FLOW (UNAUDITED) (Dollars in thousands) Quarter Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Adjusted operating income (loss) reconciliation: Operating income (loss) $ 23,728 $ 16,142 $ 34,607 $ 35,099 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted operating income (loss) $ 28,826 $ 19,027 $ 45,469 $ 39,329 Adjusted EBITDA reconciliation: Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Interest expense, net 9,006 1,790 15,085 3,436 Operating income (loss) 23,728 16,142 34,607 35,099 Depreciation and amortization 10,067 5,677 18,564 11,295 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted EBITDA $ 38,893 $ 24,704 $ 64,033 $ 50,624 Free cash flow reconciliation: Net cash provided by (used for) operating activities $ 14,347 $ 22,852 $ 34,617 $ 48,638 Capital expenditures (4,417 ) (6,125 ) (10,124 ) (15,216 ) Free cash flow $ 9,930 $ 16,727 $ 24,493 $ 33,422 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 June 30, Six Months Ended June 30, 2024 2023 2024 2023 Adjusted net income (loss) reconciliation: Net income (loss) $ 10,279 $ 10,605 $ 13,782 $ 23,581 Income tax expense (benefit) 4,443 3,747 5,740 8,082 Income (loss) before income taxes 14,722 14,352 19,522 31,663 Restructuring expenses and other adjustments 2,978 275 3,219 885 Acquisition and integration costs 678 111 4,088 346 Acquisition-related inventory step-up 1,342 — 4,457 — Insurance recovery of legal fees — — (702 ) — Executive severance costs — 699 — 699 Environmental reserves, net 100 1,800 (200 ) 2,300 Adjusted income (loss) before income taxes 19,820 17,237 30,384 35,893 Income tax expense, as adjusted (1) (5,259 ) (4,309 ) (7,900 ) (8,973 ) Adjusted net income (loss) $ 14,561 $ 12,928 $ 22,484 $ 26,920 Adjusted earnings per diluted share reconciliation: Net income (loss) per common diluted share $ 0.28 $ 0.29 $ 0.37 $ 0.64 Restructuring expenses and other adjustments 0.08 0.00 0.09 0.02 Acquisition and integration costs 0.02 0.00 0.11 0.01 Acquisition-related inventory step-up 0.04 — 0.12 — Insurance recovery of legal fees — — (0.02 ) — Executive severance costs — 0.02 — 0.02 Environmental reserves, net 0.00 0.05 (0.01 ) 0.06 Adjusted effective income tax rate impact (0.03 ) (0.01 ) (0.06 ) (0.02 ) Adjusted earnings per diluted share(2) $ 0.39 $ 0.35 $ 0.60 $ 0.73 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 $ 0.76 $ 0.91 Add: Net restructuring expenses and other adjustments 0.14 0.14 Add: Acquisition and integration costs (3) 0.25 0.25 Less: Insurance recovery of legal fees (0.02 ) (0.02 ) Less: Environmental reserves, net (0.01 ) (0.01 ) Less: Adjusted effective income tax rate impact (1) (0.07 ) (0.07 ) Adjusted earnings per diluted share (2) $ 1.05 $ 1.20 (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 View source version on businesswire.com: https://www.businesswire.com/news/home/20240801624582/en/
