TREDEGAR CORPORATION 2023 Second Quarter Financial Results |
August 29, 2023 |
Forward-Looking Statements
Certain statements contained in this presentation are forward-looking statements. Pursuant to federal securities regulations, we have set forth cautionary statements relating to those forward-looking statements in our Annual Report on Form 10-K for the year ended December 31, 2022, in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2023, and in other filings with the Securities and Exchange Commission. We urge readers to review and carefully consider these cautionary statements and the other disclosures we make in our filings with the SEC.
This presentation contains non-GAAP financial measures that are not determined in accordance with United States GAAP. These non-GAAP financial measures should not be considered in isolation, as an alternative to, or more meaningful than measures of financial performance determined in accordance with United States GAAP. A reconciliation of those financial measures to United States GAAP financial measures is
included under "Supplemental Information" in this presentation and is available on the company's website at www.tredegar.comunder "Investors."
The report speaks as of the date thereof. Tredegar is not, and should not be deemed to be, updating or reaffirming any information contained therein. We do not undertake, and expressly disclaim any duty, to update any forward-looking statements made in this
presentation to reflect any change in management's expectations or any change in
conditions, assumptions or circumstances on which such statements are based.
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Tredegar Corporation
2023 Second Quarter and First Six Months Results
(in millions, except per share data) | ||||
2Q 2023 | 2Q 2022 | YTD 2023 | YTD 2022 | |
Net Sales1 | $171.0 | $263.3 | $356.0 | $491.8 |
Net Income from Ongoing Operations2 | $(2.0) | $17.2 | $0.5 | $34.1 |
Diluted EPS from Ongoing Operations2 | $(0.06) | $0.51 | $0.01 | $1.01 |
- See Note 1 in GAAP to Non-GAAP Reconciliations for more information and a reconciliation of this non-GAAP financial measure.
- See Note 3 in GAAP to Non-GAAP Reconciliations for more information and a reconciliation of this non-GAAPfinancial measure.
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"We recognized a loss for the quarter with each of our businesses suffering from depressed conditions in their markets, which we believe can mostly be traced to the residual impact of the pandemic. The timing of a recovery for them remains uncertain. Significant spending controls are in place. Debt, net of cash, declined by $20 million during the quarter from much-needed improvement in working capital. Further working capital improvement is anticipated by year end.
"But what we need most is a recovery in sales, profits and operating cash flow across all business segments, which has been slow in occurring. Meanwhile, we have a pension plan settlement obligation due in the fourth quarter estimated at $30 million. We have suspended our quarterly dividend and recently amended our credit facility to provide some 'breathing room'. We're thankful for our dedicated employees that are working hard to help drive a turnaround."
John Steitz, CEO and President (Second Quarter 2023 Earnings Release)
Aluminum Extrusions (Bonnell Aluminum)
2023 Second Quarter and First Six Months Results
Second Quarter Performance | First Six Months Performance | ||||||||||
(in millions) | 2Q 23 | 2Q 22 | (in millions) | 2023 | 2022 | ||||||
Volume (lbs.) | 35.5 | 49.0 | (28)% | Volume (lbs.) | 73.1 | 92.0 | (21)% | ||||
Net Sales1 | $121.8 | $190.3 | (36)% | Net Sales1 | $255.2 | $348.4 | (27)% | ||||
Ongoing Operations: | Ongoing Operations: | ||||||||||
EBITDA | $10.2 | $21.9 | (53)% | EBITDA | $24.9 | $45.8 | (46)% | ||||
Less: D&A | (4.2) | (4.2) | Less: D&A | (8.6) | (8.4) | ||||||
EBIT2 | $6.0 | $17.7 | (66)% | EBIT2 | $16.3 | $37.4 | (56)% |
Second Quarter Financial Highlights
- EBITDA from ongoing operations in the second quarter of 2023 decreased $11.7 million or 53.3% versus the second quarter of 2022 primarily due to:
- Lower volume ($11.9 million), higher labor and employee-related costs ($0.7 million), lower labor productivity ($0.5 million), lower pricing ($1.0 million) and higher supply expense associated with inflationary costs ($0.8 million), partially offset by lower utility costs ($1.0 million), lower freight rates ($0.3 million) and lower selling, general and administrative ("SG&A") expenses ($1.6 million); and
- The timing of the flow-through under the first-infirst-out method of aluminum raw material costs passed through to customers, previously acquired at higher prices in a quickly changing commodity pricing environment, resulted in a charge of $1.3 million in the second quarter of 2023 versus a charge of $1.6 million in the second quarter of 2022.
- See Sales, Net New Orders and Open Orders on Page 4.
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1 Net sales represents gross sales less freight. The Company uses net sales as its measure of revenues from external customers at the segment level. 2 See Note 1 in GAAP to Non-GAAP Reconciliations for more information and a reconciliation of this non-GAAP financial measure.
Aluminum Extrusions (Bonnell Aluminum)
Open Orders, Net Bookings and ABI Index
- Open orders at the end of the second quarter of 2023 were 20 million pounds (versus 27 million pounds at the end of the first quarter of 2023), which is below the quarterly range of 21 to 27 million pounds in 2019, before pandemic-related disruptions that resulted in excessive open orders which peaked in the first quarter of 2022 at approximately 100 million pounds. While open orders have declined over the past year, Aluminum Extrusions has realized three sequential quarters of net bookings growth.
- One of the key indicators for non-residential building & construction (B&C) is the Architecture Billings Index (ABI), which leads non-residential B&C activity by 9 to 12 months. Published monthly by the American Institute of Architects, the ABI is a diffusion index. An index score of 50 represents no change in firm billings from the previous month, a score above 50 indicates an increase in firm billings from the previous month, and a score below 50 indicates a decline in firm billings from the previous month.
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Tredegar Corporation published this content on 29 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 August 2023 23:19:13 UTC.
