UFPI UFP Industries Inc

Raising long-term goals for unit growth and profitability

UFP Industries, Inc. (Nasdaq: UFPI) today announced net sales of $1.5 billion, net earnings attributable to controlling interest of $103 million, and earnings per diluted share of $1.62 for the fourth quarter of 2023. The company also announced net sales of $7.2 billion and earnings per diluted share of $8.07 for fiscal 2023. Fiscal 2023 results reflect the impact of one less week compared to fiscal 2022.

“Our teammates produced solid results in 2023 and built the foundation for future growth in sales and profits,” said Chairman and CEO Matthew J. Missad. “Our operating margins and robust cash flow continue to surpass historic levels and allow us to remain on offense. We have the capital to make significant investments to grow, both organically and through acquisitions, while continuing to enhance our value-added product offering. This gives us the confidence to raise our long-term targets for growth and profitability.”

“As we look to 2024, we expect market conditions to remain challenging in the first half of the year before improving in the second half,” Missad added. “We are committed to make each aspect of our business better as we work toward greater efficiencies, lower costs and more innovative products and services. The team’s commitment to winning contributed greatly to our success in 2023 and positions us well for the future.”

Fourth Quarter 2023 Highlights (comparisons on a year-over-year basis; results reflect the impact of one less week of operating activity in the fourth quarter of 2023):

• Net sales of $1.52 billion decreased 20 percent due to a 10 percent decrease in prices and a 10 percent decrease in organic unit sales. The organic unit growth decline was due, in part, to the impact of one less week of operating activity in the fourth quarter of 2023, which resulted in a 6 percent unit decline.
• New product sales of $142 million decreased 18 percent, largely due to lower lumber prices. New product sales comprised 9.2 percent of total sales in 2023 compared to 8.9 percent last year.
• Earnings from operations of $124 million decreased 26 percent.
• Adjusted EBITDA1 of $166 million decreased 22 percent, and adjusted EBITDA1 margin declined 20 basis points to 10.9 percent.

Fiscal 2023 Highlights (comparisons on a year-over-year basis; results reflect the impact of one less week of operating activity in 2023):

• Net sales of $7.2 billion decreased 25 percent from the record year of 2022 due to a 16 percent decrease in prices and a 9 percent decline in organic unit sales. One less week of operating activity in 2023 resulted in a 1 percent unit decline.
• New product sales were $716 million, down 6 percent, primarily due to lower lumber prices. New product sales comprised 9.7 percent of total sales in 2023 compared to 7.7 percent in 2022.
• Higher-margin, value-added product sales improved to 68 percent of total sales, up from 63 percent in 2022.
• Earnings from operations of $647 million decreased 32 percent.
• Diluted EPS of $8.07 decreased 26 percent.
• Adjusted EBITDA1 of $810 million decreased 26 percent. Adjusted EBITDA1 margin declined 20 basis points to 11.2 percent.

________________________

1 Represents a non-GAAP measurement; see the reconciliation of non-GAAP financial measures and related explanations below.

Capital Allocation

UFP Industries maintains a strong balance sheet with $841.9 million in net surplus cash (surplus cash less interest-bearing debt and cash overdraft) at year-end 2023, compared to $281.3 million in net surplus cash at year-end 2022. The company had more than $2.4 billion of liquidity at year-end 2023. The company’s return-focused approach to capital allocation includes the following:

- Acquisitions. In September 2023, the company acquired Palets Suller Group, a leader in machine-built pallets based in Castellón, Spain, for approximately $52 million. The company continues to seek strategic acquisitions that drive long-term growth and margin improvements, enhance its capabilities, and create incremental value for its customers and shareholders.

- Capital expenditures. The company invested approximately $180 million in capital expenditures during 2023 and is targeting $250 million to $300 million in capital expenditures for 2024. These investments include expanding capacity for its Deckorators line in the Northeastern U.S., its site-built construction business in the Western U.S., and its packaging business nationally.

- Dividend payments. The company paid dividends of $68.2 million or $1.10 per share in 2023, a 16 percent increase per share over 2022. On February 1, 2024, the Board of Directors approved a quarterly dividend payment of $0.33 per share, payable on March 15, 2024, to shareholders of record on March 1, 2024. The dividend represents a 10 percent increase over the quarterly dividend of $0.30 per share paid in December 2023 and a 32 percent increase over the quarterly dividend of $0.25 per share paid in March 2023.

- Share repurchases. The company repurchased approximately 975,000 shares of common stock for $82.1 million during 2023 (an average price of $84.27 per share). The company has remaining authorization to purchase up to $173 million in shares through July 31, 2024.

By business segment, the company reported the following 2023 results:

UFP Retail Solutions

Fourth Quarter: $505.6 million in net sales, down 27 percent from the fourth quarter of 2022 due to a 9 percent decline in selling prices and an 18 percent decline in organic unit sales. One less week of operating activity in the fourth quarter of 2023 resulted in a 6 percent unit decline. The remaining organic unit decline was primarily due to the UFP-Edge and ProWood business units.

Full Year: $2.87 billion in net sales, down 21 percent from 2022 due to a 15 percent decline in selling prices and a 6 percent decline in organic unit sales. One less week of operating activity in 2023 resulted in a 1 percent unit decline.

UFP Packaging

Fourth Quarter: $413.7 million in net sales, down 21 percent compared to the fourth quarter of 2022, due to a 10 percent decline in selling prices and an 11 percent decline in organic unit sales. One less week of operating activity in the fourth quarter of 2023 resulted in a 6 percent unit decline.

Full Year: $1.84 billion in net sales, down 23 percent from the previous year due to a 17 percent decline in selling prices and a 6 percent decrease in organic unit sales. One less week of operating activity in 2023 resulted in a 1 percent unit decline.

UFP Construction

Fourth Quarter: $511 million in net sales, down 16 percent from the fourth quarter of 2022, due to a 13 percent decline in selling prices and a 3 percent decline in organic unit sales. One less week of operating activity in the fourth quarter of 2023 resulted in a 6 percent unit decline.

Full Year: $2.16 billion in net sales, down 31 percent from the previous year due to an 18 percent decline in selling prices and a 13 percent decline in organic unit sales. One less week of operating activity in 2023 resulted in a 1 percent unit decline.

Short-Term Outlook

Lumber Market: We anticipate lumber prices, which returned to more normalized levels in 2023 after pandemic-inflated highs, will remain at lower levels based on current supply and demand and follow more typical seasonal trends.

End Market Demand: Based on key packaging indicators and forecasts for homebuilding and repair and remodeling, we anticipate demand for our packaging segment will be slightly down and demand for our construction and retail segments to be slightly up to slightly down in 2024. We expect softer demand and a more competitive price environment in the first half of 2024, with improvement during the second half of the year.

Long-Term Goals

The company’s five-year financial goals include:

- Achieving compounded annual unit sales growth of 7-10 percent. Smaller tuck-in acquisitions are intended to contribute to this goal.

- Realizing and sustaining a 12.5 percent adjusted EBITDA margin by continuing to enhance our capabilities and grow our portfolio of sales of value-added products, and by achieving operating improvements.

- Earning an incremental return on investment over our cost of capital.

- Maintaining a conservative capital structure.

CONFERENCE CALL

UFP Industries will conduct a conference call to discuss information included in this news release and related matters at 9 a.m. ET on Tuesday, February 20, 2024. The call will be hosted by CEO Matthew J. Missad and CFO Michael Cole, and will be available simultaneously and in its entirety to all interested investors and news media through a webcast at www.ufpi.com. A replay of the call will be available through the website.

UFP Industries, Inc.

UFP Industries, Inc. is a holding company whose operating subsidiaries – UFP Packaging, UFP Construction and UFP Retail Solutions – manufacture, distribute and sell a wide variety of value-added products used in residential and commercial construction, packaging and other industrial applications worldwide. Founded in 1955, the company is headquartered in Grand Rapids, Mich., with affiliates in North America, Europe, Asia and Australia. UFP Industries is ranked #403 on the Fortune 500 and #128 on Industry Week’s list of America’s Largest Manufacturers. For more about UFP Industries, go to www.ufpi.com.

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act, as amended, that are based on management’s beliefs, assumptions, current expectations, estimates and projections about the markets we serve, the economy and the Company itself. Words like “anticipates,” “believes,” “confident,” “estimates,” “expects,” “forecasts,” “likely,” “plans,” “projects,” “should,” variations of such words, and similar expressions identify such forward-looking statements. These statements do not guarantee future performance and involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. The Company does not undertake to update forward-looking statements to reflect facts, circumstances, events, or assumptions that occur after the date the forward-looking statements are made. Actual results could differ materially from those included in such forward-looking statements. Investors are cautioned that all forward-looking statements involve risks and uncertainty. Among the factors that could cause actual results to differ materially from forward-looking statements are the following: fluctuations in the price of lumber; adverse or unusual weather conditions; adverse economic conditions in the markets we serve; government regulations, particularly involving environmental and safety regulations; and our ability to make successful business acquisitions. Certain of these risk factors as well as other risk factors and additional information are included in the Company's reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission

Non-GAAP Financial Information

This release includes certain financial information not prepared in accordance with U.S. GAAP. Because not all companies calculate non-GAAP financial information identically (or at all), the presentations herein may not be comparable to other similarly titled measures used by other companies. Management uses Adjusted EBITDA, a non-GAAP financial measure, in order to evaluate historical and ongoing operations. Management believes that this non-GAAP financial measure is useful in order to enable investors to perform meaningful comparisons of historical and current performance. Adjusted EBITDA is intended to supplement and should be read together with the financial results. Adjusted EBITDA should not be considered an alternative or substitute for, and should not be considered superior to, the reported financial results. Accordingly, users of this financial information should not place undue reliance on the non-GAAP financial measure.

Net earnings

Net earnings refers to net earnings attributable to controlling interest unless specifically noted.

 

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME (UNAUDITED)

FOR THE THREE AND TWELVE MONTHS ENDED

DECEMBER 2023/2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Period

Year to Date

(In thousands, except per share data)

 

2023

2022

2023

2022

NET SALES

 

$

1,524,353

 

 

100.0

 

%

$

1,913,697

 

 

100.0

 

%

$

7,218,384

 

 

100.0

 

%

$

9,626,739

 

 

100.0

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COST OF GOODS SOLD

 

 

1,228,211

 

 

80.6

 

 

 

1,556,227

 

 

81.3

 

 

 

5,799,446

 

 

80.3

 

 

 

7,837,278

 

 

81.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GROSS PROFIT

 

 

296,142

 

 

19.4

 

 

 

357,470

 

 

18.7

 

 

 

1,418,938

 

 

19.7

 

 

 

1,789,461

 

 

18.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

 

 

171,598

 

 

11.3

 

 

 

183,064

 

 

9.6

 

 

 

766,633

 

 

10.6

 

 

 

832,079

 

 

8.6

 

 

OTHER LOSSES (GAINS), NET

 

 

547

 

 

—

 

 

 

5,857

 

 

0.3

 

 

 

5,771

 

 

0.1

 

 

 

7,198

 

 

0.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS FROM OPERATIONS

 

 

123,997

 

 

8.1

 

 

 

168,549

 

 

8.8

 

 

 

646,534

 

 

9.0

 

 

 

950,184

 

 

9.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INTEREST AND OTHER

 

 

(11,664

)

 

(0.8

)

 

 

(4,490

)

 

(0.2

)

 

 

(24,707

)

 

(0.3

)

 

 

15,368

 

 

0.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS BEFORE INCOME TAXES

 

 

135,661

 

 

8.9

 

 

 

173,039

 

 

9.0

 

 

 

671,241

 

 

9.3

 

 

 

934,816

 

 

9.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME TAXES

 

 

31,753

 

 

2.1

 

 

 

41,160

 

 

2.2

 

 

 

156,784

 

 

2.2

 

 

 

229,852

 

 

2.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET EARNINGS

 

 

103,908

 

 

6.8

 

 

 

131,879

 

 

6.9

 

 

 

514,457

 

 

7.1

 

 

 

704,964

 

 

7.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LESS NET LOSS (EARNINGS) ATTRIBUTABLE TO NONCONTROLLING INTEREST

 

 

(461

)

 

—

 

 

 

710

 

 

—

 

 

 

(145

)

 

—

 

 

 

(12,313

)

 

(0.1

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET EARNINGS ATTRIBUTABLE TO CONTROLLING INTEREST

 

$

103,447

 

 

6.8

 

 

$

132,589

 

 

6.9

 

 

$

514,312

 

 

7.1

 

 

$

692,651

 

 

7.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS PER SHARE - BASIC

 

$

1.65

 

 

 

 

$

2.12

 

 

 

 

$

8.21

 

 

 

 

$

11.05

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS PER SHARE - DILUTED

 

$

1.62

 

 

 

 

$

2.10

 

 

 

 

$

8.07

 

 

 

 

$

10.97

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COMPREHENSIVE INCOME

 

$

111,775

 

 

 

 

$

135,057

 

 

 

 

$

529,293

 

 

 

 

$

702,466

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LESS COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST

 

 

(2,139

)

 

 

 

 

(195

)

 

 

 

 

(4,800

)

 

 

 

 

(13,485

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COMPREHENSIVE INCOME ATTRIBUTABLE TO CONTROLLING INTEREST

 

$

109,636

 

 

 

 

$

134,862

 

 

 

 

$

524,493

 

 

 

 

$

688,981

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS BY SEGMENT (UNAUDITED)

FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 2023/2022

 

 

 

Quarter Period

 

 

2023

(In thousands)

 

Retail

 

Packaging

 

Construction

 

All Other

 

Corporate

 

Total

NET SALES

 

$

505,559

 

$

413,654

 

$

511,042

 

$

93,722

 

$

376

 

 

$

1,524,353

COST OF GOODS SOLD

 

 

444,357

 

 

331,488

 

 

390,983

 

 

69,288

 

 

(7,905

)

 

 

1,228,211

GROSS PROFIT

 

 

61,202

 

 

82,166

 

 

120,059

 

 

24,434

 

 

8,281

 

 

 

296,142

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

 

 

38,971

 

 

39,170

 

 

62,393

 

 

13,252

 

 

17,812

 

 

 

171,598

OTHER

 

 

753

 

 

92

 

 

87

 

 

59

 

 

(444

)

 

 

547

EARNINGS FROM OPERATIONS

 

$

21,478

 

$

42,904

 

$

57,579

 

$

11,123

 

$

(9,087

)

 

$

123,997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Period

 

 

2022

(In thousands)

 

Retail

 

Packaging

 

Construction

 

All Other

 

Corporate

 

Total

NET SALES

 

$

690,663

 

$

522,171

 

 

$

604,895

 

$

99,425

 

$

(3,457

)

 

$

1,913,697

COST OF GOODS SOLD

 

 

631,116

 

 

391,443

 

 

 

466,541

 

 

70,207

 

 

(3,080

)

 

 

1,556,227

GROSS PROFIT

 

 

59,547

 

 

130,728

 

 

 

138,354

 

 

29,218

 

 

(377

)

 

 

357,470

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

 

 

33,893

 

 

49,871

 

 

 

61,695

 

 

17,012

 

 

20,592

 

 

 

183,063

OTHER

 

 

183

 

 

(489

)

 

 

1,259

 

 

4,844

 

 

60

 

 

 

5,857

EARNINGS FROM OPERATIONS

 

$

25,471

 

$

81,346

 

 

$

75,400

 

$

7,362

 

$

(21,029

)

 

$

168,550

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year to Date

 

 

2023

(In thousands)

 

Retail

 

Packaging

 

Construction

 

All Other

 

Corporate

 

Total

NET SALES

 

$

2,886,515

 

$

1,838,200

 

$

2,161,059

 

$

328,884

 

$

3,726

 

 

$

7,218,384

COST OF GOODS SOLD

 

 

2,508,513

 

 

1,422,940

 

 

1,637,329

 

 

240,106

 

 

(9,442

)

 

 

5,799,446

GROSS PROFIT

 

 

378,002

 

 

415,260

 

 

523,730

 

 

88,778

 

 

13,168

 

 

 

1,418,938

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

 

 

209,182

 

 

219,323

 

 

279,107

 

 

55,654

 

 

3,367

 

 

 

766,633

OTHER

 

 

757

 

 

8

 

 

1,277

 

 

4,482

 

 

(753

)

 

 

5,771

EARNINGS FROM OPERATIONS

 

$

168,063

 

$

195,929

 

$

243,346

 

$

28,642

 

$

10,554

 

 

$

646,534

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year to Date

 

 

2022

(In thousands)

 

Retail

 

Packaging

 

Construction

 

All Other

 

Corporate

 

Total

NET SALES

 

$

3,650,639

 

$

2,394,681

 

$

3,143,868

 

$

431,611

 

$

5,940

 

 

$

9,626,739

COST OF GOODS SOLD

 

 

3,306,112

 

 

1,808,449

 

 

2,417,212

 

 

300,307

 

 

5,198

 

 

 

7,837,278

GROSS PROFIT

 

 

344,527

 

 

586,232

 

 

726,656

 

 

131,304

 

 

742

 

 

 

1,789,461

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

 

 

193,383

 

 

250,858

 

 

328,125

 

 

66,745

 

 

(7,032

)

 

 

832,079

OTHER

 

 

817

 

 

129

 

 

1,097

 

 

5,929

 

 

(774

)

 

 

7,198

EARNINGS FROM OPERATIONS

 

$

150,327

 

$

335,245

 

$

397,434

 

$

58,630

 

$

8,548

 

 

$

950,184

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ADJUSTED EBITDA RECONCILIATION BY SEGMENT (UNAUDITED)

FOR THE THREE MONTHS ENDED

DECEMBER 2023/2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Period

 

 

2023

(In thousands)

 

Retail

 

Packaging

 

Construction

 

All Other

 

Corporate

 

Total

Net earnings

 

$

16,426

 

 

$

31,823

 

 

$

44,104

 

 

$

11,933

 

 

$

(378

)

 

$

103,908

 

Interest and other

 

 

32

 

 

 

1,356

 

 

 

(3

)

 

 

(4,456

)

 

 

(8,593

)

 

 

(11,664

)

Income taxes

 

 

5,020

 

 

 

9,725

 

 

 

13,478

 

 

 

3,646

 

 

 

(116

)

 

 

31,753

 

Expenses associated with share-based compensation arrangements

 

 

1,331

 

 

 

2,110

 

 

 

1,698

 

 

 

248

 

 

 

3,444

 

 

 

8,831

 

Net loss (gain) on disposition and impairment of assets

 

 

740

 

 

 

92

 

 

 

54

 

 

 

(27

)

 

 

(654

)

 

 

205

 

Gain from reduction of estimated earnout liability

 

 

(134

)

 

 

(3,475

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(3,609

)

Depreciation expense

 

 

6,353

 

 

 

8,958

 

 

 

5,354

 

 

 

1,520

 

 

 

7,946

 

 

 

30,131

 

Amortization of intangibles

 

 

1,101

 

 

 

2,192

 

 

 

702

 

 

 

1,642

 

 

 

365

 

 

 

6,002

 

Adjusted EBITDA

 

$

30,869

 

 

$

52,781

 

 

$

65,387

 

 

$

14,506

 

 

$

2,014

 

 

$

165,557

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA as a Percentage of Net Sales

 

 

6.1

%

 

 

12.8

%

 

 

12.8

%

 

 

15.5

%

 

 

535.6

%

 

 

10.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Period

 

 

2022

(In thousands)

 

Retail

 

Packaging

 

Construction

 

All Other

 

Corporate

 

Total

Net earnings

 

$

19,357

 

 

$

62,233

 

 

$

57,451

 

 

$

8,708

 

 

$

(15,870

)

 

$

131,879

 

Interest and other

 

 

106

 

 

 

(572

)

 

 

(8

)

 

 

(4,038

)

 

 

22

 

 

 

(4,490

)

Income taxes

 

 

6,008

 

 

 

19,685

 

 

 

17,957

 

 

 

2,692

 

 

 

(5,182

)

 

 

41,160

 

Expenses associated with share-based compensation arrangements

 

 

1,153

 

 

 

1,283

 

 

 

1,185

 

 

 

148

 

 

 

4,408

 

 

 

8,177

 

Net loss (gain) on disposition and impairment of assets

 

 

168

 

 

 

(489

)

 

 

1,287

 

 

 

342

 

 

 

(375

)

 

 

933

 

Impairment of goodwill and other intangibles

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4,261

 

 

 

—

 

 

 

4,261

 

Depreciation expense

 

 

6,085

 

 

 

5,694

 

 

 

5,263

 

 

 

964

 

 

 

7,176

 

 

 

25,182

 

Amortization of intangibles

 

 

1,389

 

 

 

1,152

 

 

 

877

 

 

 

2,504

 

 

 

129

 

 

 

6,051

 

Adjusted EBITDA

 

$

34,266

 

 

$

88,986

 

 

$

84,012

 

 

$

15,581

 

 

$

(9,692

)

 

$

213,153

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA as a Percentage of Net Sales

 

 

5.0

%

 

 

17.0

%

 

 

13.9

%

 

 

15.7

%

 

 

280.4

%

 

 

11.1

%

 

ADJUSTED EBITDA RECONCILIATION BY SEGMENT (UNAUDITED)

FOR THE TWELVE MONTHS ENDED

DECEMBER 2023/2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year to Date

 

 

2023

(In thousands)

 

Retail

 

Packaging

 

Construction

 

All Other

 

Corporate

 

Total

Net earnings

 

$

128,712

 

 

$

148,269

 

 

$

186,603

 

 

$

28,790

 

 

$

22,083

 

 

$

514,457

 

Interest and other

 

 

108

 

 

 

2,368

 

 

 

(10

)

 

 

(8,932

)

 

 

(18,241

)

 

 

(24,707

)

Income taxes

 

 

39,243

 

 

 

45,292

 

 

 

56,753

 

 

 

8,784

 

 

 

6,712

 

 

 

156,784

 

Expenses associated with share-based compensation arrangements

 

 

5,575

 

 

 

7,595

 

 

 

7,190

 

 

 

935

 

 

 

13,604

 

 

 

34,899

 

Net loss (gain) on disposition and impairment of assets

 

 

801

 

 

 

7

 

 

 

9

 

 

 

(167

)

 

 

(910

)

 

 

(260

)

Gain from reduction of estimated earnout liability

 

 

(593

)

 

 

(1,784

)

 

 

(800

)

 

 

 

 

 

—

 

 

 

(3,177

)

Depreciation expense

 

 

23,943

 

 

 

32,996

 

 

 

19,546

 

 

 

3,994

 

 

 

30,084

 

 

 

110,563

 

Amortization of intangibles

 

 

4,566

 

 

 

8,849

 

 

 

2,904

 

 

 

3,488

 

 

 

1,520

 

 

 

21,327

 

Adjusted EBITDA

 

$

202,355

 

 

$

243,592

 

 

$

272,195

 

 

$

36,892

 

 

$

54,852

 

 

$

809,886

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA as a Percentage of Net Sales

 

 

7.0

%

 

 

13.3

%

 

 

12.6

%

 

 

11.2

%

 

 

1472.1

%

 

 

11.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year to Date

 

 

2022

 

 

 

 

 

 

(In thousands)

 

Retail

 

Packaging

 

Construction

 

All Other

 

Corporate

 

Total

Net earnings

 

$

113,245

 

 

$

251,187

 

 

$

299,721

 

 

$

42,844

 

 

$

(2,033

)

 

$

704,964

 

Interest and other

 

 

162

 

 

 

2,158

 

 

 

(12

)

 

 

1,817

 

 

 

11,243

 

 

 

15,368

 

Income taxes

 

 

36,920

 

 

 

81,900

 

 

 

97,725

 

 

 

13,969

 

 

 

(662

)

 

 

229,852

 

Expenses associated with share-based compensation arrangements

 

 

4,476

 

 

 

5,125

 

 

 

4,882

 

 

 

614

 

 

 

13,059

 

 

 

28,156

 

Net loss (gain) on disposition and impairment of assets

 

 

785

 

 

 

131

 

 

 

1,349

 

 

 

347

 

 

 

(1,327

)

 

 

1,285

 

Impairment of goodwill and other intangibles

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4,261

 

 

 

—

 

 

 

4,261

 

Depreciation expense

 

 

19,898

 

 

 

28,191

 

 

 

15,364

 

 

 

2,992

 

 

 

27,618

 

 

 

94,063

 

Amortization of intangibles

 

 

4,131

 

 

 

6,925

 

 

 

3,358

 

 

 

4,571

 

 

 

514

 

 

 

19,499

 

Adjusted EBITDA

 

$

179,617

 

 

$

375,617

 

 

$

422,387

 

 

$

71,415

 

 

$

48,412

 

 

$

1,097,448

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA as a Percentage of Net Sales

 

 

4.9

%

 

 

15.7

%

 

 

13.4

%

 

 

16.5

%

 

 

815.0

%

 

 

11.4

%

 

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

DECEMBER 2023/2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSETS

 

2023

 

2022

 

LIABILITIES AND EQUITY

 

2023

2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,118,329

 

$

559,397

 

Accounts payable

 

$

203,055

 

$

206,941

 

Restricted cash

 

 

3,927

 

 

226

 

Accrued liabilities and other

 

 

322,021

 

 

401,952

 

Investments

 

 

34,745

 

 

36,013

 

Current portion of debt

 

 

42,900

 

 

2,942

 

Accounts receivable

 

 

549,499

 

 

617,604

 

 

 

 

 

 

 

 

 

Inventories

 

 

727,788

 

 

973,227

 

 

 

 

 

 

 

 

 

Other current assets

 

 

67,801

 

 

75,646

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL CURRENT ASSETS

 

 

2,502,089

 

 

2,262,113

 

TOTAL CURRENT LIABILITIES

 

 

567,976

 

 

611,835

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER ASSETS

 

 

220,278

 

 

232,427

 

LONG-TERM DEBT AND FINANCE LEASE OBLIGATIONS

 

 

233,534

 

 

275,154

 

INTANGIBLE ASSETS, NET

 

 

518,853

 

 

488,551

 

OTHER LIABILITIES

 

 

166,067

 

 

181,381

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TEMPORARY EQUITY

 

 

20,030

 

 

6,880

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PROPERTY, PLANT AND EQUIPMENT, NET

 

 

776,577

 

 

688,982

 

SHAREHOLDERS' EQUITY

 

 

3,030,190

 

 

2,596,823

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

4,017,797

 

$

3,672,073

 

TOTAL LIABILITIES AND EQUITY

 

$

4,017,797

 

$

3,672,073

 

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE TWELVE MONTHS ENDED DECEMBER 2023/2022

 

 

 

 

 

 

 

 

 

(In thousands)

 

2023

 

 

2022

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net earnings

 

$

514,457

 

 

 

$

704,964

 

 

Adjustments to reconcile net earnings to net cash used in operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation

 

 

110,563

 

 

 

 

94,063

 

 

Amortization of intangibles

 

 

21,327

 

 

 

 

19,499

 

 

Expense associated with share-based and grant compensation arrangements

 

 

34,899

 

 

 

 

28,156

 

 

Deferred income taxes (credit)

 

 

(5,573

)

 

 

 

(16,289

)

 

Unrealized (gain) loss on investment and other

 

 

(2,435

)

 

 

 

5,768

 

 

Equity in loss of investee

 

 

2,367

 

 

 

 

2,183

 

 

Net (gain) loss on sale and disposition of assets

 

 

(260

)

 

 

 

1,285

 

 

Impairment of goodwill and other intangibles

 

 

—

 

 

 

 

4,261

 

 

Gain from reduction of estimated earnout liability

 

 

(3,177

)

 

 

 

—

 

 

Changes in:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

81,659

 

 

 

 

130,704

 

 

Inventories

 

 

250,561

 

 

 

 

718

 

 

Accounts payable and cash overdraft

 

 

(3,578

)

 

 

 

(137,907

)

 

Accrued liabilities and other

 

 

(40,920

)

 

 

 

(5,838

)

 

NET CASH FROM OPERATING ACTIVITIES

 

 

959,890

 

 

 

 

831,567

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS USED IN INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Purchases of property, plant, and equipment

 

 

(180,382

)

 

 

 

(174,124

)

 

Proceeds from sale of property, plant and equipment

 

 

3,291

 

 

 

 

3,805

 

 

Acquisitions, net of cash received and purchase of equity method investment

 

 

(52,383

)

 

 

 

(180,151

)

 

Purchase of remaining noncontrolling interest of subsidiary

 

 

(2,127

)

 

 

 

—

 

 

Purchases of investments

 

 

(29,806

)

 

 

 

(19,875

)

 

Proceeds from sale of investments

 

 

29,935

 

 

 

 

12,874

 

 

Other

 

 

(8,692

)

 

 

 

3,535

 

 

NET CASH USED IN INVESTING ACTIVITIES

 

 

(240,164

)

 

 

 

(353,936

)

 

 

 

 

 

 

 

 

 

 

CASH FLOWS USED IN FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Borrowings under revolving credit facilities

 

 

28,462

 

 

 

 

605,101

 

 

Repayments under revolving credit facilities

 

 

(30,125

)

 

 

 

(607,549

)

 

Repayments of debt

 

 

(29

)

 

 

 

(38,719

)

 

Contingent consideration payments and other

 

 

(6,262

)

 

 

 

(2,856

)

 

Proceeds from issuance of common stock

 

 

2,750

 

 

 

 

2,769

 

 

Dividends paid to shareholders

 

 

(68,238

)

 

 

 

(58,860

)

 

Distributions to noncontrolling interest

 

 

(7,355

)

 

 

 

(12,024

)

 

Repurchase of common stock

 

 

(82,149

)

 

 

 

(95,774

)

 

Other

 

 

86

 

 

 

 

(2,298

)

 

NET CASH USED IN FINANCING ACTIVITIES

 

 

(162,860

)

 

 

 

(210,210

)

 

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash

 

 

5,767

 

 

 

 

979

 

 

NET CHANGE IN CASH AND CASH EQUIVALENTS

 

 

562,633

 

 

 

 

268,400

 

 

 

 

 

 

 

 

 

 

 

ALL CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

 

 

559,623

 

 

 

 

291,223

 

 

 

 

 

 

 

 

 

 

 

ALL CASH AND CASH EQUIVALENTS, END OF PERIOD

 

$

1,122,256

 

 

 

$

559,623

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of cash and cash equivalents and restricted cash:

 

 

 

 

 

 

 

 

Cash and cash equivalents, beginning of period

 

$

559,397

 

 

 

$

286,662

 

 

Restricted cash, beginning of period

 

 

226

 

 

 

 

4,561

 

 

All cash and cash equivalents, beginning of period

 

$

559,623

 

 

 

$

291,223

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents, end of period

 

$

1,118,329

 

 

 

$

559,397

 

 

Restricted cash, end of period

 

 

3,927

 

 

 

 

226

 

 

All cash and cash equivalents, end of period

 

$

1,122,256

 

 

 

$

559,623

 

 

 

 

 

 

 

 

 

 

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240220036821/en/

Dick Gauthier VP of Investor Relations (616) 365-1555