OMAHA, Neb.--(BUSINESS WIRE)--Valmont Industries, Inc. (NYSE: VMI), a global leader that provides vital infrastructure and advances agricultural productivity while driving innovation through technology, today reported financial results for the first quarter ended April 1, 2023.
First Quarter 2023 Highlights (all metrics compared to First Quarter 2022 unless otherwise noted)
-
Achieved record first quarter Net Sales, Operating Income and Diluted Earnings per Share (“EPS”)
- Net Sales of $1.1 billion increased 8.3%; excluding 2022 “Other” segment, Net Sales increased 10.4%1
- Operating Income increased 24.9% to $118.5 million, or 11.1% of net sales (increased 23.4% to $122.1 million or 11.5% adjusted1) compared to $94.8 million or 9.7% of net sales ($99.0 million or 10.1% adjusted1); excluding 2022 “Other” segment, Operating Income growth was similar
- Diluted EPS grew to $3.47 ($3.61 adjusted1) compared to $2.90 ($3.07 adjusted1)
- Generated seasonally strong operating cash flows of $21.2 million compared to $2.7 million in 2022
- Secured an $85 million order to provide mechanized irrigation equipment and innovative technology for multiple agriculture development projects in Africa
- Backlog of $1.6 billion, reflecting continued strong market demand across the portfolio
- Announced a $400 million share repurchase reauthorization with no expiration and a 9% quarterly dividend increase, from $0.55 to $0.60 ($2.20 to $2.40 annualized); repurchased 356,900 shares of company stock for $111.1 million
- Effective tax rate of 30.3%, driven by the geographic mix of earnings
1Please see Reg G reconciliation to GAAP measures at end of document
Key Financial Metrics
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First Quarter 2023 |
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GAAP |
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Adjusted1 |
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(000's except per share amounts) |
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04/01/2023 |
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03/26/2022 |
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04/01/2023 |
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03/26/2022 |
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Q1 2023 |
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Q1 2022 |
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vs. Q1 2022 |
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Q1 2023 |
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Q1 2022 |
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vs. Q1 2022 |
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Net Sales |
|
$ |
1,062,481 |
|
$ |
980,820 |
|
8.3 |
% |
|
$ |
1,062,481 |
|
$ |
962,166 |
|
10.4 |
% |
||||
Operating Income |
|
|
118,466 |
|
|
94,842 |
|
24.9 |
% |
|
|
122,125 |
|
|
98,985 |
|
23.4 |
% |
||||
Operating Income as a % of Net Sales |
|
|
11.1 |
% |
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9.7 |
% |
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11.5 |
% |
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10.3 |
% |
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Net Earnings |
|
|
74,540 |
|
|
62,311 |
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19.6 |
% |
|
|
77,653 |
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|
65,888 |
|
17.9 |
% |
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Diluted Earnings Per Share |
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$ |
3.47 |
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$ |
2.90 |
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19.7 |
% |
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$ |
3.61 |
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$ |
3.07 |
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17.6 |
% |
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Average Shares Outstanding |
|
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21,512 |
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|
21,492 |
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|
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21,512 |
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|
21,492 |
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“We delivered record results in our first quarter, demonstrating continued growth and outstanding performance as we provide innovative solutions to our customers,” said Stephen G. Kaniewski, President and Chief Executive Officer. “Driven by strong end market demand, the solid execution and operational excellence of our global teams, and our commitment to disciplined pricing strategies, we achieved significant operating income growth and margin expansion in both segments. We are executing our growth strategies while meeting growing market demand through investments in incremental capacity and technology solutions to better serve our customers. Across global infrastructure markets, we are seeing strong, multi-year demand for our products and solutions that support our customers’ critical infrastructure buildouts and energy transition initiatives. Underlying agricultural market fundamentals, particularly in South America, continue to be favorable as global commodity prices remain elevated and 2023 net farm income levels in North America are projected to remain above historical averages. Our teams around the world remain committed to providing our customers with vital infrastructure products and solutions to enhance agricultural productivity with an unwavering focus on price leadership and shareholder value creation.”
First Quarter 2023 Segment Review
Infrastructure (68.9% of Net Sales)
Products and solutions to serve the infrastructure markets of utility, solar, lighting, transportation, and telecommunications, and coatings services to preserve metal products
Sales of $736.1 million grew 11.2% year-over-year, with double-digit sales growth in nearly all product lines, led by Transmission, Distribution and Substation (TD&S) and Solar (formerly Renewable Energy). Higher sales were driven by favorable pricing globally, higher volumes, notably in the Lighting and Transportation (L&T) and Solar product lines, and sales from the ConcealFab acquisition.
Operating Income improved to $94.4 million or 12.9% of net sales compared to $78.3 million or 11.9% of net sales in first quarter 2022, driven by favorable pricing and higher volumes.
Agriculture (31.1% of Net Sales)
Center pivot components and linear irrigation equipment for agricultural markets, including parts and tubular products; advanced technology solutions for precision agriculture
Sales of $332.2 million increased 8.3% year-over-year, with sales growth led by higher average selling prices of irrigation equipment globally. International sales were significantly higher, led by a record first quarter in Brazil and higher Middle East sales. North America sales were similar to last year despite first quarter 2022 benefiting from the delivery of record year-end backlog. Sales of agriculture technology products and services globally were higher.
Operating Income improved to $53.3 million, or 16.1% of net sales ($57.0 million or 17.2% adjusted1) compared to $37.5 million or 12.4% of net sales ($41.6 million or 13.7% adjusted1) in first quarter 2022. The benefit of higher average selling prices and additional volume leverage were partially offset by higher SG&A, including incremental R&D expense for technology investments.
Other
Offshore wind energy structures business
As previously announced, the divestiture of the offshore wind energy structures business was completed in December 2022. In the first quarter of 2022, the subsequently-divested business generated sales of $18.7 million and an operating loss of $0.8 million.
Balance Sheet, Liquidity, and Capital Allocation
The Company generated strong first quarter 2023 operating cash flows of $21.2 million through record earnings and effectively managing working capital while supporting sales growth. At the end of the first quarter, cash and cash equivalents were $172.9 million. This quarter, Valmont announced an additional $400.0 million share repurchase authorization with no expiration and repurchased $111.1 million of company stock, with $370.3 million remaining on the share repurchase program. During the quarter, Moody's reaffirmed the Company's Baa3/Stable credit rating.
Updating 2023 Full Year Financial Outlook and Key Assumptions
The Company is raising its full-year diluted earnings per share outlook from the previous indications that were communicated last quarter and is providing updated key assumptions for the year.
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2023 Full Year Financial Outlook |
Previous Outlook |
Revised Outlook |
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Net Sales Growth (vs. PY) |
4% to 7% |
No Change |
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GAAP Diluted Earnings per Share |
$14.70 to $15.25 |
$14.80 to $15.35 |
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Adjusted Diluted Earnings per Share1 |
$15.35 to $15.90 |
$15.45 to $16.00 |
- 2022 sales include the offshore wind energy structures business which was divested at the end of fiscal 2022
- Effective tax rate of 28% to 29%, primarily due to expected geographic mix of earnings
- Minimal expected foreign currency translation impact to net sales
- Capital expenditures expected to be in the range of $105 to $125 million to support strategic growth and digital transformation initiatives
- Continued elevated inflation, raw material costs aligned with current price projections, and ongoing R&D investments
Kaniewski continued, “We are excited about the opportunity to support our customers and drive multi-year profitable growth by capitalizing on the strong market drivers across our businesses. These factors, along with our proven track record of execution and a backlog of $1.6 billion, give us confidence in our 2023 outlook. The long-term need for critical infrastructure investment globally is supporting multi-year market growth trends. Favorable global agriculture market trends, strong international markets and increasing adoption of innovative technology solutions are supporting growth for our Agriculture business. Looking ahead to the second quarter, we expect difficult sales comparisons in the Agriculture segment due to international project timing and last year’s ongoing delivery of considerable levels of backlog. Operating margin levels are expected to continue across the portfolio for second quarter and full year due to better price/cost alignment. We will continue to execute pricing strategies to manage broad-based inflation and leverage the strength of our global supply chain to deliver innovative products and solutions to our customers. Our balance sheet remains strong, giving us the flexibility to execute our long-term strategic plan. Our strategy remains focused on long-term profitable growth with an organizational emphasis on return on invested capital and operational excellence as we invest to meet the future needs of our customers and deliver value to our stakeholders.”
A live audio discussion with Stephen G. Kaniewski, President and Chief Executive Officer, and Avner M. Applbaum, Executive Vice President and Chief Financial Officer, will be accessible by telephone on Friday, April 21, 2023 at 8:00 a.m. CDT by dialing 1-877-407-6184 or 1-201-389-0877 (no Conference ID needed), or via webcast by pointing browsers to this link: Valmont Industries 1Q 2023 Earnings Conference Call. A slide presentation will simultaneously be available for download on the Investors page of valmont.com. A replay of the event can be accessed three hours after the call at the above link or by telephone at 1-877-660-6853 or 1-201-612-7415. Please use access code 13734763. The replay will be available through 10:59 p.m. CDT on Friday, April 28, 2023.
About Valmont Industries, Inc.
For over 75 years, Valmont® has been a global leader in creating vital infrastructure and advancing agricultural productivity. Today, we remain committed to doing more with less by innovating through technology. Learn more about how we’re Conserving Resources. Improving Life.® at valmont.com.
Concerning Forward-Looking Statements
This release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on assumptions that management has made in light of experience in the industries in which Valmont operates, as well as management’s perceptions of historical trends, current conditions, expected future developments and other factors believed to be appropriate under the circumstances. As you read and consider this release, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties (some of which are beyond Valmont’s control) and assumptions. Although management believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect Valmont’s actual financial results and cause them to differ materially from those anticipated in the forward-looking statements. These factors include among other things, the continuing and developing effects of the pandemic including the effects of the outbreak on the general economy and the specific economic effects on the Company’s business and that of its customers and suppliers, risk factors described from time to time in Valmont’s reports to the Securities and Exchange Commission, as well as future economic and market circumstances, industry conditions, company performance and financial results, operating efficiencies, availability and price of raw material, availability and market acceptance of new products, product pricing, domestic and international competitive environments, geopolitical risks, and actions and policy changes of domestic and foreign governments. The Company cautions that any forward-looking statement included in this press release is made as of the date of this press release and the Company does not undertake to update any forward-looking statement.
VALMONT INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Dollars in thousands, except per share amounts) (unaudited) |
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First Quarter |
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13 Weeks Ended |
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04/01/2023 |
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03/26/2022 |
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Net sales |
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$ |
1,062,481 |
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$ |
980,820 |
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Cost of sales |
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753,896 |
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731,634 |
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Gross profit |
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308,585 |
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249,186 |
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Selling, general, and administrative expenses |
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190,119 |
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154,344 |
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Operating income |
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118,466 |
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|
94,842 |
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Other income (expense) |
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Interest expense |
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(13,105 |
) |
|
|
(11,263 |
) |
Interest income |
|
|
830 |
|
|
|
227 |
|
Gain (loss) on investments - unrealized |
|
|
1,194 |
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|
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(1,063 |
) |
Other |
|
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(2,376 |
) |
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|
3,642 |
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Other income (expense), net |
|
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(13,457 |
) |
|
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(8,457 |
) |
Earnings before income taxes |
|
|
105,009 |
|
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|
86,385 |
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Income tax expense |
|
|
31,843 |
|
|
|
23,121 |
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Equity in loss of nonconsolidated subsidiaries |
|
|
(821 |
) |
|
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(358 |
) |
Net earnings |
|
|
72,345 |
|
|
|
62,906 |
|
Less: Loss (earnings) attributable to non-controlling interests |
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|
2,195 |
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(595 |
) |
Net earnings attributable to Valmont Industries, Inc. |
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$ |
74,540 |
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$ |
62,311 |
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Average shares outstanding (000's) - Basic |
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21,269 |
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21,279 |
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Earnings per share - Basic |
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$ |
3.50 |
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$ |
2.93 |
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Average shares outstanding (000's) - Diluted |
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21,512 |
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|
21,492 |
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Earnings per share - Diluted |
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$ |
3.47 |
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$ |
2.90 |
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Cash dividends per share |
|
$ |
0.60 |
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$ |
0.55 |
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VALMONT INDUSTRIES, INC. AND SUBSIDIARIES SUMMARY OPERATING RESULTS (Dollars in thousands) (Unaudited) |
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First Quarter |
|||||
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13 Weeks Ended |
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04/01/2023 |
|
03/26/2022 |
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Net sales |
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|
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|
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Infrastructure |
|
$ |
736,106 |
|
|
$ |
662,072 |
|
Agriculture |
|
|
332,163 |
|
|
|
306,580 |
|
Other |
|
|
— |
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|
18,654 |
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Total |
|
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1,068,269 |
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|
987,306 |
|
Less: Intersegment sales |
|
|
(5,788 |
) |
|
|
(6,486 |
) |
Total |
|
$ |
1,062,481 |
|
|
$ |
980,820 |
|
|
|
|
|
|
|
|
||
Operating Income (Loss) |
|
|
|
|
|
|
||
Infrastructure |
|
$ |
94,352 |
|
|
$ |
78,316 |
|
Agriculture |
|
|
53,323 |
|
|
|
37,475 |
|
Other |
|
|
— |
|
|
|
(809 |
) |
Corporate |
|
|
(29,209 |
) |
|
|
(20,140 |
) |
Total |
|
$ |
118,466 |
|
|
$ |
94,842 |
|
Valmont has aggregated its business segments into two global reportable segments as follows.
Infrastructure: This segment consists of the manufacture and distribution of products and solutions to serve the infrastructure markets of utility, solar, lighting, transportation, and telecommunications, and coatings services to preserve metal products.
Agriculture: This segment consists of the manufacture of center pivot components and linear irrigation equipment for agricultural markets, including parts and tubular products, and advanced technology solutions for precision agriculture.
In addition to these two reportable segments, the Company had a business and related activities in 2022 that were not more than 10% of consolidated sales, operating income, or assets. This included the offshore wind energy structures business which was reported in the “Other” segment until its divestiture in December 2022.
VALMONT INDUSTRIES, INC. AND SUBSIDIARIES SUMMARY OPERATING RESULTS (Dollars in thousands) (Unaudited) |
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Thirteen weeks ended April 1, 2023 |
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Intersegment |
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|||
|
|
Infrastructure |
|
Agriculture |
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Other |
|
Sales |
|
Consolidated |
||||||
Geographical market: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America |
|
$ |
584,083 |
|
$ |
182,869 |
|
$ |
— |
|
$ |
(5,374 |
) |
|
$ |
761,578 |
International |
|
|
152,023 |
|
|
149,294 |
|
|
— |
|
|
(414 |
) |
|
|
300,903 |
Total |
|
$ |
736,106 |
|
$ |
332,163 |
|
$ |
— |
|
$ |
(5,788 |
) |
|
$ |
1,062,481 |
|
|
|
|
|
|
|
|
|
|
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|
|
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Product line: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transmission, Distribution, and Substation |
|
$ |
314,820 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
|
$ |
314,820 |
Lighting and Transportation |
|
|
229,136 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
229,136 |
Coatings |
|
|
90,114 |
|
|
— |
|
|
— |
|
|
(3,552 |
) |
|
|
86,562 |
Telecommunications |
|
|
68,137 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
68,137 |
Solar |
|
|
33,899 |
|
|
— |
|
|
— |
|
|
(414 |
) |
|
|
33,485 |
Irrigation Equipment and Parts, excluding Technology |
|
|
— |
|
|
299,181 |
|
|
— |
|
|
(1,822 |
) |
|
|
297,359 |
Technology Products and Services |
|
|
— |
|
|
32,982 |
|
|
— |
|
|
— |
|
|
|
32,982 |
Total |
|
$ |
736,106 |
|
$ |
332,163 |
|
$ |
— |
|
$ |
(5,788 |
) |
|
$ |
1,062,481 |
|
|
Thirteen weeks ended March 26, 2022 |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
Intersegment |
|
|
|
|||
|
|
Infrastructure |
|
Agriculture |
|
Other |
|
Sales |
|
Consolidated |
||||||
Geographical market: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America |
|
$ |
505,980 |
|
$ |
182,255 |
|
$ |
— |
|
$ |
(6,486 |
) |
|
$ |
681,749 |
International |
|
|
156,092 |
|
|
124,325 |
|
|
18,654 |
|
|
— |
|
|
|
299,071 |
Total |
|
$ |
662,072 |
|
$ |
306,580 |
|
$ |
18,654 |
|
$ |
(6,486 |
) |
|
$ |
980,820 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product line: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transmission, Distribution, and Substation |
|
$ |
281,600 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
|
$ |
281,600 |
Lighting and Transportation |
|
|
212,767 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
212,767 |
Coatings |
|
|
81,976 |
|
|
— |
|
|
— |
|
|
(3,101 |
) |
|
|
78,875 |
Telecommunications |
|
|
61,396 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
61,396 |
Solar |
|
|
24,333 |
|
|
— |
|
|
18,654 |
|
|
— |
|
|
|
42,987 |
Irrigation Equipment and Parts, excluding Technology |
|
|
— |
|
|
278,034 |
|
|
— |
|
|
(3,385 |
) |
|
|
274,649 |
Technology Products and Services |
|
|
— |
|
|
28,546 |
|
|
— |
|
|
— |
|
|
|
28,546 |
Total |
|
$ |
662,072 |
|
$ |
306,580 |
|
$ |
18,654 |
|
$ |
(6,486 |
) |
|
$ |
980,820 |
VALMONT INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (unaudited) |
||||||
|
|
|
|
|
|
|
|
|
04/01/2023 |
|
12/31/2022 |
||
ASSETS |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
172,948 |
|
$ |
185,406 |
Accounts receivable, net |
|
|
650,041 |
|
|
604,181 |
Inventories |
|
|
725,360 |
|
|
728,762 |
Contract assets |
|
|
159,785 |
|
|
174,539 |
Prepaid expenses and other assets |
|
|
107,365 |
|
|
87,697 |
Total current assets |
|
|
1,815,499 |
|
|
1,780,585 |
Property, plant, and equipment, net |
|
|
598,848 |
|
|
595,578 |
Goodwill and other assets |
|
|
1,190,145 |
|
|
1,180,833 |
|
|
$ |
3,604,492 |
|
$ |
3,556,996 |
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Current installments of long-term debt |
|
$ |
1,165 |
|
$ |
1,194 |
Notes payable to banks |
|
|
11,436 |
|
|
5,846 |
Accounts payable |
|
|
368,576 |
|
|
360,312 |
Accrued expenses |
|
|
211,112 |
|
|
248,320 |
Contract liabilities |
|
|
156,333 |
|
|
172,915 |
Income taxes payable |
|
|
20,093 |
|
|
3,664 |
Dividends payable |
|
|
12,634 |
|
|
11,742 |
Total current liabilities |
|
|
781,349 |
|
|
803,993 |
Long-term debt, excluding current installments |
|
|
985,636 |
|
|
870,935 |
Operating lease liabilities |
|
|
151,219 |
|
|
155,469 |
Other long-term liabilities |
|
|
87,888 |
|
|
84,887 |
Shareholders' equity |
|
|
1,598,400 |
|
|
1,641,712 |
|
|
$ |
3,604,492 |
|
$ |
3,556,996 |
VALMONT INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) (unaudited) |
||||||||
|
|
|
|
|
|
|
||
|
|
13 Weeks Ended |
|
13 Weeks Ended |
||||
|
|
04/01/2023 |
|
03/26/2022 |
||||
Cash flows from operating activities |
|
|
|
|
|
|
||
Net earnings |
|
$ |
72,345 |
|
|
$ |
62,906 |
|
Depreciation and amortization |
|
|
24,558 |
|
|
|
23,884 |
|
Contribution to defined benefit pension plan |
|
|
(15,259 |
) |
|
|
— |
|
Change in working capital |
|
|
(83,206 |
) |
|
|
(91,929 |
) |
Other |
|
|
22,761 |
|
|
|
7,842 |
|
Net cash flows provided by operating activities |
|
|
21,199 |
|
|
|
2,703 |
|
|
|
|
|
|
|
|
||
Cash flows from investing activities |
|
|
|
|
|
|
||
Purchase of property, plant, and equipment |
|
|
(22,361 |
) |
|
|
(27,095 |
) |
Other |
|
|
572 |
|
|
|
(2,005 |
) |
Net cash flows used in investing activities |
|
|
(21,789 |
) |
|
|
(29,100 |
) |
|
|
|
|
|
|
|
||
Cash flows from financing activities |
|
|
|
|
|
|
||
Proceeds from long-term borrowings |
|
|
125,000 |
|
|
|
97,000 |
|
Principal payments on long-term borrowings |
|
|
(10,796 |
) |
|
|
(82,529 |
) |
Net proceeds (payments) on short-term borrowings |
|
|
5,302 |
|
|
|
(5,562 |
) |
Purchase of treasury shares |
|
|
(111,115 |
) |
|
|
— |
|
Dividends to noncontrolling interests |
|
|
(654 |
) |
|
|
— |
|
Dividends paid |
|
|
(11,742 |
) |
|
|
(10,616 |
) |
Other |
|
|
(9,004 |
) |
|
|
(1,814 |
) |
Net cash flows used in financing activities |
|
|
(13,009 |
) |
|
|
(3,521 |
) |
Effect of exchange rates on cash and cash equivalents |
|
|
1,141 |
|
|
|
2,386 |
|
Net change in cash and cash equivalents |
|
|
(12,458 |
) |
|
|
(27,532 |
) |
Cash and cash equivalents - beginning of year |
|
|
185,406 |
|
|
|
177,232 |
|
Cash and cash equivalents - end of period |
|
$ |
172,948 |
|
|
$ |
149,700 |
|
VALMONT INDUSTRIES, INC. AND SUBSIDIARIES
SUMMARY OF EFFECT OF ITEMS ON REPORTED RESULTS
REGULATION G RECONCILIATION
(Dollars in thousands, except per share amounts)
(unaudited)
The non-GAAP tables below disclose the impact of intangible asset amortization (Prospera) and stock-based compensation recognized for the Prospera employees on fiscal 2023 and 2022 results. We believe the adjustments for Prospera allow for a better investor understanding of Agriculture segment performance related to traditional segment products. Amounts may be impacted by rounding. We believe it is useful when considering company performance for the non-GAAP adjusted net earnings and operating income to be taken into consideration by management and investors with the related reported GAAP measures.
|
|
|
|
|
|
|
||
|
|
Thirteen |
|
Diluted |
||||
|
|
weeks ended |
|
earnings per |
||||
|
|
April 1, 2023 |
|
share |
||||
Net earnings attributable to Valmont Industries, Inc. - as reported |
|
$ |
74,540 |
|
|
$ |
3.47 |
|
Prospera intangible asset amortization |
|
|
1,645 |
|
|
|
0.08 |
|
Stock-based compensation - Prospera |
|
|
2,014 |
|
|
|
0.09 |
|
Total Adjustments, pre-tax1 |
|
|
3,659 |
|
|
|
0.17 |
|
Tax effect of adjustments2 |
|
|
(546 |
) |
|
|
(0.03 |
) |
Net earnings attributable to Valmont Industries, Inc. - Adjusted1 |
|
$ |
77,653 |
|
|
$ |
3.61 |
|
Average shares outstanding (000’s) - Diluted |
|
|
|
|
|
21,512 |
|
|
|
|
|
|
|
|
|
||
|
|
Thirteen |
|
Diluted |
||||
|
|
weeks ended |
|
earnings per |
||||
|
|
March 26, 2022 |
|
share |
||||
Net earnings attributable to Valmont Industries, Inc. - as reported |
|
$ |
62,311 |
|
|
$ |
2.90 |
|
Prospera intangible asset amortization |
|
|
1,645 |
|
|
|
0.08 |
|
Stock-based compensation - Prospera |
|
|
2,498 |
|
|
|
0.12 |
|
Total Adjustments, pre-tax1 |
|
|
4,143 |
|
|
|
0.19 |
|
Tax effect of adjustments2 |
|
|
(566 |
) |
|
|
(0.03 |
) |
Net earnings attributable to Valmont Industries, Inc. - Adjusted1 |
|
$ |
65,888 |
|
|
$ |
3.07 |
|
Average shares outstanding (000’s) - Diluted |
|
|
|
|
|
21,492 |
|
|
|
|
|
|
|
|
|
|
|
1Earnings per share includes rounding 2The tax effect of adjustments is calculated based on the income tax rate in each applicable jurisdiction. |
||||||||
VALMONT INDUSTRIES, INC. AND SUBSIDIARIES
SUMMARY OF EFFECT OF SIGNIFICANT NON-RECURRING ITEMS ON REPORTED RESULTS
REGULATION G RECONCILIATION
(Dollars in thousands, except per share amounts)
(unaudited)
The non-GAAP tables below disclose the impact of intangible asset amortization (Prospera) and stock-based compensation recognized for the Prospera employees on fiscal 2023 and 2022 results. We believe the adjustments for Prospera allow for a better investor understanding of Agriculture segment performance related to traditional segment products. Amounts may be impacted by rounding. We believe it is useful when considering company performance for the non-GAAP adjusted net earnings and operating income to be taken into consideration by management and investors with the related reported GAAP measures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Thirteen weeks ended April 1, 2023 |
|
||||||||||||||||
Operating Income Reconciliation |
|
Infrastructure |
|
Agriculture |
|
Other |
|
Corporate |
|
Valmont |
|||||||||
Operating income - as reported |
|
$ |
94,352 |
|
$ |
53,323 |
|
$ |
— |
|
$ |
(29,209 |
) |
|
$ |
118,466 |
|
||
Prospera intangible asset amortization |
|
|
— |
|
|
1,645 |
|
|
— |
|
|
— |
|
|
|
1,645 |
|
||
Stock-based compensation - Prospera |
|
|
— |
|
|
2,014 |
|
|
— |
|
|
— |
|
|
|
2,014 |
|
||
Adjusted Operating Income |
|
$ |
94,352 |
|
$ |
56,982 |
|
$ |
— |
|
$ |
(29,209 |
) |
|
$ |
122,125 |
|
||
Net Sales - as reported |
|
|
732,140 |
|
|
330,341 |
|
|
— |
|
|
— |
|
|
|
1,062,481 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Operating Income as a % of Net Sales |
|
|
12.9 |
% |
|
16.1 |
% |
|
NM |
|
|
NM |
|
|
|
11.1 |
% |
||
Adj. Operating Income as a % of Net Sales |
|
|
12.9 |
% |
|
17.2 |
% |
|
NM |
|
|
NM |
|
|
|
11.5 |
% |
||
|
|
Thirteen weeks ended March 26, 2022 |
|
||||||||||||||||||
Operating Income Reconciliation |
|
Infrastructure |
|
Agriculture |
|
Other |
|
Corporate |
|
Valmont |
|||||||||||
Operating income - as reported |
|
$ |
78,316 |
|
$ |
37,475 |
|
$ |
(809 |
) |
|
$ |
(20,140 |
) |
|
$ |
94,842 |
|
|||
Prospera intangible asset amortization |
|
|
— |
|
|
1,645 |
|
|
— |
|
|
|
— |
|
|
|
1,645 |
|
|||
Stock-based compensation - Prospera |
|
|
— |
|
|
2,498 |
|
|
— |
|
|
|
— |
|
|
|
2,498 |
|
|||
Adjusted Operating Income |
|
$ |
78,316 |
|
$ |
41,618 |
|
$ |
(809 |
) |
|
$ |
(20,140 |
) |
|
$ |
98,985 |
|
|||
Net Sales - as reported |
|
|
658,971 |
|
|
303,195 |
|
|
18,654 |
|
|
|
— |
|
|
|
980,820 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Operating Income as a % of Net Sales |
|
|
11.9 |
% |
|
12.4 |
% |
|
(4.3 |
) |
% |
|
NM |
|
|
|
9.7 |
% |
|||
Adj. Operating Income as a % of Net Sales |
|
|
11.9 |
% |
|
13.7 |
% |
|
(4.3 |
) |
% |
|
NM |
|
|
|
10.1 |
% |
|||
VALMONT INDUSTRIES, INC. AND SUBSIDIARIES
REGULATION G RECONCILIATION OF EXCLUDING OTHER SEGMENT NET SALES
(Dollars in thousands, except per share amounts)
(unaudited)
Excluding Other segment net sales from the first quarter of fiscal 2022, which we refer to in this reconciliation as “Adjusted Net Sales” is a non-GAAP measure. The Other segment net sales were generated by the wind energy structures business which was divested in December 2022. Adjusted Net Sales should not be considered in isolation or as a substitute for net earnings, cash flows from operations or other income or cash flow data prepared in accordance with GAAP, or as a measure of our operating performance or liquidity. The table below shows how Adjusted Net Sales is calculated from our statements of earnings. Adjusted Net Sales is calculated as Net Sales less Other segment net sales. Adjusted Net Sales allows investors to analyze our operating performance in light of the amount of net sales less net sales of a divested business.
|
|
13 Weeks Ended |
|
13 Weeks Ended |
|
|
|
|||
|
|
04/01/2023 |
|
03/26/2022 |
|
% Change |
||||
Net sales |
|
$ |
1,062,481 |
|
$ |
980,820 |
|
|
8.3% |
|
Other segment net sales |
|
|
— |
|
|
18,654 |
|
|
NM |
|
Adjusted net sales |
|
$ |
1,062,481 |
|
$ |
962,166 |
|
|
10.4% |
|
VALMONT INDUSTRIES, INC. AND SUBSIDIARIES
REGULATION G RECONCILIATION OF FORECASTED GAAP AND ADJUSTED EARNINGS
(Dollars in thousands, except per share amounts)
The non-GAAP tables below disclose the impact on the range of estimated diluted earnings per share of the (1) amortization of the intangible asset (Prospera) and (2) stock-based compensation for Prospera employees. We believe the adjustments for Prospera allow for a better investor understanding of Agriculture segment performance related to traditional segment products. We believe it is useful when considering company performance for the non-GAAP adjusted net earnings to be taken into consideration by management and investors with the related reported GAAP measures.
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Range of Net Earnings - 2023 Guidance |
|
Low End |
|
High End |
|
Adjustments |
||||
Estimated net earnings - GAAP |
|
$ |
318,250 |
|
$ |
330,050 |
|
|
|
|
Prospera intangible asset (proprietary technology) amortization, pre-tax |
|
|
|
|
|
|
|
|
6,600 |
|
Stock-based compensation - Prospera, pre-tax |
|
|
|
|
|
|
|
|
9,800 |
|
Total pre-tax adjustments |
|
|
|
|
|
|
|
|
16,400 |
|
Estimated tax benefit from above expenses1 |
|
|
|
|
|
|
|
|
(2,450 |
) |
|
|
|
|
|
|
|
|
|
|
|
Total Adjustments, after-tax |
|
|
|
|
|
|
|
$ |
13,950 |
|
Estimated net earnings - Adjusted |
|
$ |
332,200 |
|
$ |
344,000 |
|
|
|
|
Diluted Earnings Per Share Range - GAAP2 |
|
$ |
14.80 |
|
$ |
15.35 |
|
|
|
|
Diluted Earnings Per Share Range - Adjusted2 |
|
$ |
15.45 |
|
$ |
16.00 |
|
|
|
|
| _______________ | ||||||||||
1 The tax effect of adjustments is calculated based on the estimated income tax rate in each applicable jurisdiction. 2 Assumes weighted average shares outstanding of 21.5M, and includes rounding |
||||||||||
