Weber Inc. Reports Fiscal Year 2022 Results

Delivered net sales of $1.6 billion in fiscal year 2022

Maintained global category leadership and best-in-class product suite

Executed on cash flow and cost management plan to deliver $110 million of future cash benefit

Significantly enhanced liquidity and capital structure with additional $350 million of unsecured borrowing capacity subsequent to quarter-end

Weber Inc. (“Weber” or “the Company”) (NYSE: WEBR) today announced its financial results for the fiscal fourth quarter and full-year 2022, ending September 30th.

Weber reports its financial performance in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and as adjusted on a non-GAAP basis. Please see “Non-GAAP Financial Measures,” and “Reconciliation of GAAP to Non-GAAP Financial Information” below for additional information and reconciliations of the non-GAAP financial measures to the most comparable GAAP financial measures.

For the year, Weber generated net sales of $1,586 million, gross profit of $434 million, net loss of $330 million, and $1 million of adjusted EBITDA loss.

“Weber is delivering world-class, innovative outdoor cooking products around the world and remains the global category leader. We continue to operate with a consumer-first mindset, build on our brand strength and identify disciplined opportunities across our product categories and channels,” said Alan Matula, interim Chief Executive Officer of Weber. “Our fiscal fourth quarter and full-year performance demonstrates that we have maintained significant growth compared to pre-pandemic levels. We continue our focus on the key initiatives we set forth in the third fiscal quarter. We look forward to executing against our growth strategies in 2023, introducing exciting products and creating additional value for our customers and all stakeholders.”

FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2022

  • Fiscal year 2022 net sales decreased 20%, to $1,586 million, from $1,982 million in the prior year. The decrease was driven by slower retail traffic, both in-store and online in all key markets, due to macroeconomic factors including falling consumer confidence levels and inflation. Foreign exchange accounted for $65 million of the net sales reduction.
  • Net sales decreased 26% in the Americas, to $820 million, from $1,102 million in the prior year; EMEA decreased 16%, to $613 million, from $726 million in the prior year; and APAC sales were $154 million, and essentially flat versus the prior year at $154 million.
    • Foreign currency negatively impacted net sales by $2 million, $56 million, and $7 million in the Americas, EMEA, and APAC respectively.
  • Gross profit decreased 47% to $434 million, or 27.4% of net sales, compared to $825 million, or 41.6% of net sales, in the prior year.
  • Net loss decreased to $330 million, or (20.8)% of net sales, compared to net income of $6 million, or 0.3% of net sales in the prior year. Adjusted net loss decreased 222%, to $195 million, or (12.3)% of net sales, compared to the adjusted net income of $161 million, or 8.1% of net sales in the prior year.
  • Adjusted EBITDA decreased 100%, to a loss of $1 million, compared to $307 million, or 15.5% of net sales, in the prior year, driven by the pressures noted above, and partially offset by the initiated selling, general, and administrative expense reductions.
  • Net cash used in operating activities was $363 million for the fiscal year ended September 30, 2022, as compared to net cash provided by operating activities of $54 million in the prior year, with the variance driven primarily due to lower operating results. Additionally, there were unfavorable impacts from accounts payable balances driven by lower purchases in the current year period and timing of payments.

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2022

  • Net sales decreased 52%, to $168 million, from $350 million in the prior year quarter.
  • Net sales decreased 60% in the Americas, to $84 million, from $211 million in the prior year quarter; EMEA decreased 54%, to $49 million, from $108 million in the prior year quarter; and APAC increased 10%, to $35 million from $31 million in the prior year quarter.
  • Net loss of $152 million, or (90.5)% of net sales, compared to a net loss of $86 million, or (24.6)% of net sales in the prior year quarter. Adjusted net loss was $96 million, or (57.1)% of net sales, compared to adjusted net loss of $35 million, or (10.1)% of net sales in the prior year quarter.
  • Adjusted EBITDA loss of $63 million, or (37.4)% of net sales, compared to $14 million loss, or (4.0)% of net sales, in the prior year quarter.

CASH FLOW AND COST MANAGEMENT PLAN

Following a detailed review in August 2022, the Company initiated a plan to manage cash flows, preserve liquidity, expand gross margins, and reduce SG&A expenses. The Company has successfully executed the previously announced actions and expects a future cash benefit of $110 million, net of restructuring costs.

SUBSEQUENT TO QUARTER-END ACTIVITY

On December 12, 2022 Weber announced that it has entered into a definitive merger agreement pursuant to which investment funds managed by BDT Capital Partners LLC (“BDT”) will purchase all of the outstanding Class A Shares that they do not already own, for $8.05 per share of Class A common stock of Weber, which implies a total enterprise value of $3.7 billion for Weber. A special committee of the board of directors (the “Special Committee”), comprised solely of independent directors, advised by its own independent financial and legal advisors, unanimously recommended that the Weber board approve the transaction. Acting upon the recommendation of the Special Committee, Weber’s board approved the transaction. Upon completion of the transaction, Weber will become a privately held company majority owned by BDT investment funds. The transaction is expected to close in the first half of 2023, subject to customary closing conditions.

Additionally, on December 12, 2022, Weber announced that BDT investment funds have agreed to provide the Company with an additional unsecured loan facility in the aggregate principal amount of $350 million. The previous loan agreement, disclosed on November 8, 2022, for $61 million will remain outstanding.

FISCAL FOURTH QUARTER AND FULL YEAR 2022 INVESTOR CONFERENCE CALL DETAILS

A conference call to discuss these fiscal fourth quarter and full-year 2022 financial results is scheduled for today, December 14, 2022, at 7:30 a.m. Central Time. Investors and analysts are invited to dial 844-200-6205 (international callers, please dial 929-526-1599) approximately 10 minutes before the start of the call. Please reference Conference ID 339681 when prompted. A live webcast of the conference call and supporting materials will be available on the Weber investor relations website, https://investors.weber.com. In addition, a replay and transcript of the webcast will be posted to the same website once available.

ABOUT WEBER INC.

Weber Inc. headquartered in Palatine, Ill., is the world’s leading barbecue brand. The Company’s founder George Stephen, Sr., established the outdoor cooking category when he invented the original kettle charcoal grill 70 years ago. Weber offers a comprehensive, innovative product portfolio, including charcoal, gas, pellet and electric grills, smokers, and accessories designed to help outdoor cooking enthusiasts discover what’s possible. Weber offers its barbecue grills and accessories, services, and experiences to a passionate community of millions across 78 countries.

NON-GAAP FINANCIAL MEASURES

This press release contains certain financial measures not presented in accordance with GAAP, including Adjusted EBITDA and Adjusted Net (Loss) Income, which are used by management in making operating decisions, allocating financial resources, and internal planning and forecasting and for business strategy purposes. Adjusted EBITDA and Adjusted Net (Loss) Income are not measures of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing our financial results. The use of non-GAAP financial information should not be considered as an alternative to, or more meaningful than, the comparable GAAP measures. In addition, because our non-GAAP measures are not determined in accordance with GAAP, it is susceptible to differing calculations, and not all comparable or peer companies may calculate their non-GAAP measures in the same manner.

Management believes that such measures are commonly reported by issuers and widely used by investors as indicators of a company’s operating performance. Please refer to the reconciliations of Adjusted EBITDA and Adjusted Net (Loss) Income to the most directly comparable financial measures prepared in accordance with GAAP below.

FORWARD-LOOKING STATEMENTS

This press release contains various “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which represent Weber’s expectations or beliefs concerning future events. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including those factors discussed in the section titled “Risk Factors” in our Annual Report on Form 10-K.

Our future results could be affected by a variety of other factors, including: uncertainty of the magnitude, duration, geographic reach, impact on the global economy and current and potential travel restrictions of the COVID-19 outbreak; the current, and uncertain future, impact of the COVID-19 outbreak on our business, growth, reputation, prospects, financial condition, operating results (including components of our financial results), and cash flows and liquidity; risks relating to any unforeseen changes to or effects on liabilities, future capital expenditures, revenues, expenses, earnings, synergies, indebtedness, financial condition, losses and future prospects; the ability to realize the anticipated benefits and synergies from business acquisitions in the amounts and at the times expected; the impact of competitive conditions; the effectiveness of pricing, advertising, and promotional programs; the success of innovation, renovation and new product introductions; the recoverability of the carrying value of goodwill and other intangibles; the success of productivity improvements and business transitions; commodity and energy prices; transportation costs; labor costs; disruptions or inefficiencies in supply chain; the availability of and interest rates on short-term and long-term financing; the levels of spending on systems initiatives, properties, business opportunities, integration of acquired businesses, and other general and administrative costs; changes in consumer behavior and preferences; the effect of U.S. and foreign economic conditions on items such as interest rates, statutory tax rates, currency conversion and availability; legal and regulatory factors including the impact of any product recalls; and business disruption or other losses from war, pandemic, terrorist acts or political unrest.

Weber Inc.

Consolidated Balance Sheets

(dollars in thousands, except share data)

 

 

September 30,

2022

 

September 30,

2021

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

24,568

 

 

$

107,517

 

Accounts receivable, less allowances (1)

 

54,667

 

 

 

138,683

 

Inventories, net

 

339,503

 

 

 

332,621

 

Prepaid expenses and other current assets

 

91,009

 

 

 

68,236

 

Total current assets

 

509,747

 

 

 

647,057

 

Property, equipment and leasehold improvements, net

 

211,256

 

 

 

162,829

 

Operating lease right-of-use assets (2)

 

71,879

 

 

 

66,962

 

Other long-term assets

 

72,732

 

 

 

61,454

 

Trademarks, net

 

354,435

 

 

 

357,821

 

Other intangible assets, net

 

123,783

 

 

 

144,257

 

Goodwill

 

104,142

 

 

 

110,612

 

Total assets

$

1,447,974

 

 

$

1,550,992

 

Liabilities and equity (deficit)

 

 

 

Current liabilities:

 

 

 

Trade accounts payable

$

158,298

 

 

$

330,669

 

Accrued expenses (3)

 

122,656

 

 

 

150,610

 

Income taxes payable

 

5,788

 

 

 

4,823

 

Current portion of long-term debt and other borrowings

 

186,910

 

 

 

12,500

 

Current portion of long-term financing obligation

 

675

 

 

 

592

 

Total current liabilities

 

474,327

 

 

 

499,194

 

Long-term debt, less current portion

 

1,213,235

 

 

 

984,818

 

Long-term financing obligation, less current portion

 

37,719

 

 

��

38,394

 

Non-current operating lease liabilities (4)

 

60,544

 

 

 

55,329

 

Tax Receivable Agreement liability

 

 

 

 

9,226

 

Other long-term liabilities

 

74,085

 

 

 

85,376

 

Total liabilities

 

1,859,910

 

 

 

1,672,337

 

Commitments and Contingencies

 

 

 

Class A Common Stock, $0.001 par value - 3,000,000,000 shares authorized, 53,102,598 and 52,533,388 shares issued and outstanding as of September 30, 2022 and September 30, 2021, respectively

 

53

 

 

 

53

 

Class B Common Stock, $0.00001 par value - 1,500,000,000 shares authorized, 234,506,636 and 233,572,370 shares issued and outstanding as of September 30, 2022 and September 30, 2021, respectively

 

2

 

 

 

2

 

Preferred Stock, $0.0001 par value - 1,500,000,000 shares authorized, zero shares issued and outstanding as of both September 30, 2022 and 2021

 

 

 

 

 

Additional paid-in capital

 

15,735

 

 

 

6,109

 

Accumulated other comprehensive loss

 

(4,762

)

 

 

(9,280

)

Retained earnings (deficit)

 

(87,851

)

 

 

(7,646

)

Total Weber Inc. equity (deficit)

 

(76,823

)

 

 

(10,762

)

Noncontrolling interests

 

(335,113

)

 

 

(110,583

)

Total equity (deficit)

 

(411,936

)

 

 

(121,345

)

Total liabilities and equity (deficit)

$

1,447,974

 

 

$

1,550,992

 

________________

(1)

Includes related party royalty receivables of $50 and $119 at September 30, 2022 and 2021, respectively.

(2)

Includes related party operating lease assets of $1,074 and $1,629 at September 30, 2022 and 2021, respectively.

(3)

Includes related party operating lease liabilities of $365 and $431 at September 30, 2022 and 2021, respectively.

(4)

Includes related party operating lease liabilities of $738 and $1,198 at September 30, 2022 and 2021, respectively.

Weber Inc.

Consolidated Statements of Operations

(dollars in thousands, except share data)

 

 

Three Months Ended September 30,

 

Fiscal Years Ended September 30,

 

2022

 

2021

 

2022

 

2021

Net sales (1)

$

168,088

 

 

$

350,230

 

 

$

1,586,459

 

 

$

1,982,406

 

Cost of goods sold (2)

 

160,192

 

 

 

244,631

 

 

 

1,152,388

 

 

 

1,157,189

 

Gross profit

 

7,896

 

 

 

105,599

 

 

 

434,071

 

 

 

825,217

 

Operating expenses:

 

 

 

 

 

 

 

Selling, general and administrative (3)(4)

 

97,116

 

 

 

183,086

 

 

 

584,631

 

 

 

738,830

 

Amortization of intangible assets

 

5,110

 

 

 

5,130

 

 

 

20,605

 

 

 

17,220

 

Restructuring costs

 

22,445

 

 

 

 

 

 

22,445

 

 

 

 

Gain on disposal of assets held for sale

 

 

 

 

 

 

 

 

 

 

(5,185

)

(Loss) income from operations

 

(116,775

)

 

 

(82,617

)

 

 

(193,610

)

 

 

74,352

 

Foreign currency loss (gain)

 

10,910

 

 

 

3,749

 

 

 

31,893

 

 

 

(23

)

Interest expense, net (5)

 

23,810

 

 

 

16,099

 

 

 

75,623

 

 

 

65,879

 

Gain on Tax Receivable Agreement liability remeasurement

 

 

 

 

 

 

 

(9,226

)

 

 

 

Loss from early extinguishment of debt

 

 

 

 

 

 

 

 

 

 

5,448

 

Other expense

 

 

 

 

 

 

 

502

 

 

 

 

(Loss) income before taxes

 

(151,495

)

 

 

(102,465

)

 

 

(292,402

)

 

 

3,048

 

Income tax expense (benefit)

 

620

 

 

 

(16,394

)

 

 

37,578

 

 

 

3,004

 

Gain from investments in unconsolidated affiliates

 

 

 

 

 

 

 

 

 

 

(5,505

)

Net (loss) income

$

(152,115

)

 

$

(86,071

)

 

$

(329,980

)

 

$

5,549

 

Net loss attributable to noncontrolling interests

 

(123,694

)

 

 

(42,177

)

 

 

(256,392

)

 

 

(42,177

)

Net (loss) income attributable to Weber Inc.

$

(28,421

)

 

$

(43,894

)

 

$

(73,588

)

 

$

47,726

 

Earnings (loss) per share of Class A common stock (6)

 

 

 

 

 

 

 

Basic

$

(0.53

)

 

$

(0.13

)

 

$

(1.37

)

 

$

(0.13

)

Diluted

$

(0.53

)

 

$

(0.13

)

 

$

(1.37

)

 

$

(0.13

)

Weighted average shares outstanding

 

 

 

 

 

 

 

Basic

 

53,923,042

 

 

 

51,788,320

 

 

 

53,539,619

 

 

 

51,788,320

 

Diluted

 

289,981,048

 

 

 

51,788,320

 

 

 

53,539,619

 

 

 

51,788,320

 

________________

(1)

Includes related party royalty revenue of $114 and $172 for the three months ended September 30, 2022 and 2021, respectively, and $493 and $247 for the fiscal years ended September 30, 2022 and 2021, respectively.

(2)

Includes related party rental expense of zero and $71 for the three months ended September 30, 2022 and 2021, respectively, and zero and $676 for the fiscal years ended September 30, 2022 and 2021, respectively.

(3)

Includes related party rental expense of $152 and $342 for the three months ended September 30, 2022 and 2021, respectively, and $665 and $538 for the fiscal years ended September 30, 2022 and 2021, respectively.

(4)

Includes related party compensation expense of zero and zero for the three months ended September 30, 2022 and 2021, respectively, and $420 and zero for the fiscal years ended September 30, 2022 and 2021, respectively.

(5)

Includes related party interest income of zero and $7 for the three months ended September 30, 2022 and 2021, respectively, and $3 and $47 for the fiscal years ended September 30, 2022 and 2021, respectively.

(6)

Basic and diluted earnings (loss) per share in fiscal year 2021 represent only the period from August 5, 2021 to September 30, 2021.

Weber Inc.

Consolidated Statement of Cash Flows

(dollars in thousands)

 

Fiscal Years Ended September 30,

 

2022

 

2021

Operating activities

 

 

 

Net (loss) income

$

(329,980

)

 

$

5,549

 

Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

 

 

 

Provision for depreciation

 

40,729

 

 

 

27,082

 

Provision for amortization of intangible assets

 

20,605

 

 

 

17,220

 

Provision for amortization of deferred financing costs

 

4,966

 

 

 

3,803

 

Deferred income tax expense (benefit)

 

20,447

 

 

 

(12,954

)

Stock/unit-based compensation

 

45,399

 

 

 

131,176

 

Gain on Tax Receivable Agreement liability remeasurement

 

(9,226

)

 

 

 

Gain from investments in unconsolidated affiliates

 

 

 

 

(5,505

)

Gain on disposal of assets held for sale

 

 

 

 

(5,185

)

Loss from early extinguishment of debt

 

 

 

 

5,448

 

Changes in operating assets and liabilities

 

 

 

Accounts receivable

 

51,204

 

 

 

(7,320

)

Inventories

 

(44,125

)

 

 

(99,506

)

Prepaid expenses and other current assets

 

(13,668

)

 

 

(25,227

)

Trade accounts payable

 

(153,883

)

 

 

12,996

 

Accrued expenses

 

(11,062

)

 

 

(1,701

)

Income taxes payable

 

2,052

 

 

 

(4,189

)

Other

 

13,406

 

 

 

12,404

 

Net cash (used in) provided by operating activities

 

(363,136

)

 

 

54,091

 

Investing activities

 

 

 

Proceeds from disposal of property, equipment and leasehold improvements

 

19

 

 

 

14,029

 

Additions to property, equipment and leasehold improvements

 

(100,928

)

 

 

(63,534

)

Payments for acquisitions

 

 

 

 

(128,514

)

Net cash used in investing activities

 

(100,909

)

 

 

(178,019

)

Financing activities

 

 

 

Proceeds from issuance of long-term debt

 

250,000

 

 

 

1,250,000

 

Payments for deferred financing costs

 

(9,700

)

 

 

(27,703

)

Payments for capitalized offering costs

 

(2,109

)

 

 

(7,043

)

Interest rate swap settlement payments

 

(5,862

)

 

 

(5,380

)

Proceeds from contribution of capital, net

 

11,346

 

 

 

13,075

 

Proceeds from Initial Public Offering

 

 

 

 

237,500

 

Proceeds received from Greenshoe option

 

 

 

 

35,627

 

Repurchase of Class A shares and LLC units

 

 

 

 

(35,627

)

Repurchase of members’ interests

 

 

 

 

(188,860

)

Dividends paid

 

(6,401

)

 

 

 

Members’ distributions

 

(34,548

)

 

 

(315,508

)

Borrowings from revolving credit facility

 

965,500

 

 

 

217,000

 

Payments on revolving credit facility

 

(798,500

)

 

 

(217,000

)

Proceeds from other borrowings

 

4,910

 

 

 

 

Payments of long-term debt

 

(13,750

)

 

 

(845,725

)

Shares withheld to satisfy employee tax obligations

 

(1,509

)

 

 

 

Other financing activities

 

(902

)

 

 

(853

)

Net cash provided by financing activities

 

358,475

 

 

 

109,503

 

Effect of exchange rate changes on cash and cash equivalents

 

22,621

 

 

 

(1,850

)

Decrease in cash and cash equivalents

 

(82,949

)

 

 

(16,275

)

Cash and cash equivalents at beginning of period

 

107,517

 

 

 

123,792

 

Cash and cash equivalents at end of period

$

24,568

 

 

$

107,517

 

Supplemental disclosures of cash flow information:

 

 

 

Cash paid for interest

$

66,082

 

 

$

56,456

 

Cash paid for income taxes, net of refunds of $316 and $4,336, respectively

$

17,280

 

 

$

20,517

 

Supplemental disclosures of non-cash investing and financing information:

 

 

 

Property and equipment included in accounts payable and accrued expenses

$

26,407

 

 

$

32,561

 

Capitalized offering costs included in accounts payable and accrued expenses

$

 

 

$

2,109

 

Settlement of existing relationship through business combination

$

 

 

$

9,776

 

Issuance of common units for business acquisition

$

 

 

$

14,582

 

Weber Inc.

Reconciliation of GAAP to Non-GAAP Financial Information

(dollars in thousands)

 

The following table reconciles (loss) income from operations to adjusted (loss) income from operations; net (loss) income to adjusted net (loss) income; net (loss) income to EBITDA; and EBITDA to Adjusted EBITDA for the periods presented:

 

 

Three Months Ended September 30,

 

Fiscal Year Ended September 30,

 

2022

 

2021

 

2022

 

2021

(Loss) income from operations

$

(116,775

)

 

$

(82,617

)

 

$

(193,610

)

 

$

74,352

 

Adjustments:

 

 

 

 

 

 

 

Foreign currency (loss) gain (1)

 

(10,910

)

 

 

(3,749

)

 

 

(31,893

)

 

 

23

 

Stock/unit-based compensation expense

 

(19,642

)

 

 

36,983

 

 

 

45,399

 

 

 

131,176

 

Restructuring costs (2)

 

22,445

 

 

 

 

 

 

22,445

 

 

 

 

Business transformation costs (3)

 

14,093

 

 

 

10,566

 

 

 

40,334

 

 

 

20,062

 

Operational transformation costs (4)

 

31,308

 

 

 

7,281

 

 

 

53,997

 

 

 

18,134

 

Financing and IPO costs (5)

 

 

 

 

4,913

 

 

 

877

 

 

 

17,573

 

COVID-19 costs (6)

 

 

 

 

614

 

 

 

 

 

 

1,162

 

Gain on disposal of assets held for sale

 

 

 

 

 

 

 

 

 

 

(5,185

)

Adjusted (loss) income from operations

$

(79,481

)

 

$

(26,009

)

 

$

(62,451

)

 

$

257,297

 

Net (loss) income

$

(152,115

)

 

$

(86,071

)

 

$

(329,980

)

 

$

5,549

 

Adjustments:

 

 

 

 

 

 

 

Stock/unit-based compensation expense

 

(19,642

)

 

 

36,983

 

 

 

45,399

 

 

 

131,176

 

Restructuring costs (2)

 

22,445

 

 

 

 

 

 

22,445

 

 

 

 

Business transformation costs (3)

 

14,093

 

 

 

10,566

 

 

 

40,334

 

 

 

20,062

 

Operational transformation costs (4)

 

31,308

 

 

 

7,281

 

 

 

53,997

 

 

 

18,134

 

Financing and IPO costs (5)

 

 

 

 

4,913

 

 

 

877

 

 

 

17,573

 

COVID-19 costs (6)

 

 

 

 

614

 

 

 

 

 

 

1,162

 

Gain on Tax Receivable Agreement liability remeasurement

 

 

 

 

 

 

 

(9,226

)

 

 

 

Loss from early extinguishment of debt

 

 

 

 

 

 

 

 

 

 

5,448

 

Gain on disposal of assets held for sale

 

 

 

 

 

 

 

 

 

 

(5,185

)

Other expense

 

 

 

 

 

 

 

502

 

 

 

 

Tax impact of adjusting items (7)

 

8,002

 

 

 

(9,657

)

 

 

(19,833

)

 

 

(33,180

)

Adjusted net (loss) income

$

(95,909

)

 

$

(35,371

)

 

$

(195,485

)

 

$

160,739

 

Net (loss) income

$

(152,115

)

 

$

(86,071

)

 

$

(329,980

)

 

$

5,549

 

Adjustments:

 

 

 

 

 

 

 

Interest expense, net

 

23,810

 

 

 

16,099

 

 

 

75,623

 

 

 

65,879

 

Income tax expense (benefit)

 

620

 

 

 

(16,394

)

 

 

37,578

 

 

 

3,004

 

Depreciation and amortization

 

16,633

 

 

 

11,895

 

 

 

61,334

 

 

 

44,302

 

EBITDA

$

(111,052

)

 

$

(74,471

)

 

$

(155,445

)

 

$

118,734

 

Stock/unit-based compensation expense

 

(19,642

)

 

 

36,983

 

 

 

45,399

 

 

 

131,176

 

Restructuring costs (2)

 

22,445

 

 

 

 

 

 

22,445

 

 

 

 

Business transformation costs (3)

 

14,093

 

 

 

10,566

 

 

 

40,334

 

 

 

20,062

 

Operational transformation costs (4)

 

31,308

 

 

 

7,281

 

 

 

53,997

 

 

 

18,134

 

Financing and IPO costs (5)

 

 

 

 

4,913

 

 

 

877

 

 

 

17,573

 

COVID-19 costs (6)

 

 

 

 

614

 

 

 

 

 

 

1,162

 

Gain on Tax Receivable Agreement liability remeasurement

 

 

 

 

 

 

 

(9,226

)

 

 

 

Loss from early extinguishment of debt

 

 

 

 

 

 

 

 

 

 

5,448

 

Gain on disposal of assets held for sale

 

 

 

 

 

 

 

 

 

 

(5,185

)

Other expense

 

 

 

 

 

 

 

502

 

 

 

 

Adjusted EBITDA

$

(62,848

)

 

$

(14,114

)

 

$

(1,117

)

 

$

307,104

 

___________

(1)

Adjusted (loss) income from operations includes foreign currency (loss) gain in order to align adjusted (loss) income from operations with Adjusted EBITDA, with the exception of depreciation and amortization and gain from investments in unconsolidated affiliates.

(2)

“Restructuring costs” are costs associated with the Company's restructuring plan that was implemented in the fourth quarter of fiscal year 2022, which included the termination of certain senior executives, a workforce reduction of non-manufacturing and distribution headcount, the termination of certain contracts and the disposal of certain other assets.

(3)

“Business transformation costs” are costs for business transformation initiatives, including consulting costs and personnel-related costs, to address public company requirements and the changing business environment.

(4)

“Operational transformation costs” are defined as transformation initiatives related to supply chain, operational moves and startups that are designed to support future production and drive future operating efficiencies. These costs also include significant non-capitalizable systems integration costs, primarily related to the Company’s implementation of a global SAP/S4 HANA ERP platform, as well as certain plant shutdown and closure costs.

(5)

“Financing and IPO costs” include non-capitalizable costs relating to the Company’s Secured Credit Facility, the Company's IPO and other financing costs.

(6)

During fiscal year 2021, the Company incurred costs related to COVID-19 for enhanced employee safety and social distancing protocols.

(7)

“Tax impact of adjusting items” represents the Company's effective tax rate for the periods presented applied to the adjusting items.

 

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