Carlisle Companies Incorporated (NYSE:CSL) today announced its
first quarter 2024 financial results.
- Diluted EPS of $3.52 and adj. EPS of $3.72, an increase of
85% YoY
- Revenue of $1.1 billion, an increase of 23% YoY
- Operating margin of 20.5% and adj. EBITDA margin of 24.2%,
expanded 530 bps YoY
- CCM expanded adj. EBITDA margin by 510 bps on 36% YoY sales
growth
- CWT delivered adj. EBITDA margin expansion of 370 bps on 1%
lower sales
- Signed definitive agreements to sell CIT and acquire
MTL
- Raising 2024 outlook to include ~10% revenue growth and
>100 bps margin expansion
Comments from Chris Koch, Chair,
President and Chief Executive Officer
"We were pleased with our overall sales growth and margin
expansion during the first quarter which reinforces the underlying
themes and key strategies we have outlined in Vision 2030. While
still early in the year, our general market feedback indicates the
overall construction markets we participate in will have a
productive 2024 season. Growing re-roof activity from pent-up
demand, favorable weather conditions fostering healthy construction
activity, and normalized customer inventory levels all positively
impacted our first quarter efforts. We are pleased that the margin
expansion delivered in the second half of 2023 continues as we
benefit from synergies from the Henry integration, our on-going COS
initiatives, and operating efficiencies on higher volumes. Pricing
continues to be in-line with our expectations, and we are
optimistic on pricing for the balance of the year based on the
recent price increases in the industry.
“After announcing our Vision 2030 plan in December of last year,
we took the final step in delivering on our commitment to becoming
a pure play building products company with the announced sale of
CIT in January for approximately $2 billion to Amphenol.
Furthermore, in March, we announced the signing of an agreement to
acquire MTL, a specialty manufacturer of high-performance metal
edge and wall systems. Both actions reinforce our commitment to our
pure play building products strategy, our philosophy of superior
capital allocation, and ultimately driving best-in-class ROIC. We
are very excited with the planned acquisition of MTL which aligns
seamlessly with Carlisle’s Vision 2030 strategy to invest in and
enhance our building envelope product portfolio.
“Continuing with our capital allocation theme, as part of our
plan to repurchase $1.4 billion of shares in 2024, we deployed $150
million in the first quarter to share repurchases.
“As we move through the rest of 2024, we are excited to continue
to share the Vision 2030 story and discuss the value creation
opportunity unlocked by our transition to a pure play building
products portfolio. As mentioned earlier, our Q1 performance
demonstrated many of the themes we discussed in our Vision 2030
presentation, including being well-positioned to leverage
mega-trends in energy efficiency, labor savings, and growing
re-roof demand within the building envelope marketplace. With this
in mind and in combination with the strength of our first quarter
results, we are increasing our full year 2024 outlook to
approximately 10% revenue growth with adjusted EBITDA margins
expanding by at least 100 basis points."
First Quarter
2024 Financial Summary
Three Months Ended
March 31,
(in millions, except per share
amounts)
2024
2023
Change %
Revenues
$
1,096.5
$
892.6
22.8
%
Operating income
225.2
120.7
86.6
%
Operating margin
20.5
%
13.5
%
700 bps
Income from continuing operations
170.9
83.6
104.4
%
Adjusted EBITDA
265.5
168.6
57.5
%
Adjusted EBITDA margin
24.2
%
18.9
%
530 bps
Diluted EPS
3.52
1.61
118.6
%
Adjusted diluted EPS
3.72
2.01
85.1
%
First Quarter 2024 Segment
Highlights
Carlisle Construction Materials ("CCM")
- Revenue of $784 million, increased 36.0% (+35.9% organic)
year-over-year, driven by the end of channel destocking, growing
re-roof activity and favorable weather.
- Operating income was $211 million and adjusted EBITDA was $227
million, up 65.8% year-over-year, reflecting an adjusted EBITDA
margin of 28.9%. The 510 basis point increase was driven by strong
operating leverage on higher revenues as well as operating
efficiencies through COS.
Carlisle Weatherproofing Technologies ("CWT")
- Revenue of $313 million, declined 1.2% (-2.5% organic)
primarily due to lower pricing.
- Operating income was $42 million and adjusted EBITDA was $65
million, up 20.0% year-over-year reflecting an adjusted EBITDA
margin of 20.7%. The 370 basis point increase was driven by
strategic sourcing, execution of COS, and realized synergies from
the Henry acquisition.
Cash Flow
Operating cash flow from continuing operations for the three
months ended March 31, 2024, was $156 million, an increase of $33
million versus the prior year. Free cash flow from continuing
operations was $132 million, an increase of $42 million versus the
prior year (defined as cash provided by operating activities less
capital expenditures and comprised of continuing operations). This
increase was driven by higher income from operations more than
offsetting an increase in working capital uses, as a result of the
increase in revenues.
During the three months ended March 31, 2024, we deployed $150
million toward share repurchases and paid $42 million in cash
dividends. As of March 31, 2024, we had 6.9 million shares
available for repurchase under our share repurchase program with
$553 million of cash and cash equivalents and $1 billion of
availability under our revolving credit facility.
2024 Outlook
- FY 2024 revenues to increase ~10%
- CCM - FY 2024 revenues to increase low double digits
- CWT - FY 2024 revenues to increase mid single digits
- Adjusted EBITDA margins expanding >100 bps
Conference Call and
Webcast
Carlisle will discuss first quarter 2024 results on a conference
call at 5:00 p.m. ET today. The call can be accessed via webcast,
along with related materials, at
www.carlisle.com/investors/events-and-presentations and via
telephone as follows:
Domestic toll free: 800-549-8228 International: 646-564-2877
Conference ID: 27308
Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements generally use words such as
"expect," "foresee," "anticipate," "believe," "project," "should,"
"estimate," "will," "plans," "intends," "forecast," and similar
expressions, and reflect our expectations concerning the future.
Such statements are made based on known events and circumstances at
the time of publication and, as such, are subject in the future to
unforeseen risks and uncertainties. It is possible that our future
performance may differ materially from current expectations
expressed in these forward-looking statements, due to a variety of
factors such as: increasing price and product/service competition
by foreign and domestic competitors, including new entrants;
technological developments and changes; the ability to continue to
introduce competitive new products and services on a timely,
cost-effective basis; our mix of products/services; increases in
raw material costs that cannot be recovered in product pricing;
domestic and foreign governmental and public policy changes
including environmental and industry regulations; the ability to
meet our goals relating to our intended reduction of greenhouse gas
emissions, including our net zero commitments; threats associated
with and efforts to combat terrorism; protection and validity of
patent and other intellectual property rights; the identification
of strategic acquisition targets and our successful completion of
any transaction and integration of our strategic acquisitions; our
successful completion of strategic dispositions; the cyclical
nature of our businesses; the impact of information technology,
cybersecurity or data security breaches at our businesses or third
parties; the outcome of pending and future litigation and
governmental proceedings; the emergence or continuation of
widespread health emergencies such as the COVID-19 pandemic,
including, for example, expectations regarding their impact on our
businesses, including on customer demand, supply chains and
distribution systems, production, our ability to maintain
appropriate labor levels, our ability to ship products to our
customers, our future results, or our full-year financial outlook;
and the other factors discussed in the reports we file with or
furnish to the Securities and Exchange Commission from time to
time. In addition, such statements could be affected by general
industry and market conditions and growth rates, the condition of
the financial and credit markets and general domestic and
international economic conditions, including inflation and interest
rate and currency exchange rate fluctuations. Further, any conflict
in the international arena, including the Russian invasion of
Ukraine and war in the Middle East, may adversely affect general
market conditions and our future performance. Any forward-looking
statement speaks only as of the date on which that statement is
made, and we undertake no duty to update any forward-looking
statement to reflect events or circumstances, including
unanticipated events, after the date on which that statement is
made, unless otherwise required by law. New factors emerge from
time to time and it is not possible for management to predict all
of those factors, nor can it assess the impact of each of those
factors on the business or the extent to which any factor, or
combination of factors, may cause actual results to differ
materially from those contained in any forward-looking
statement.
Non-GAAP Disclosure
Carlisle reports its financial results in accordance with the
U.S. generally accepted accounting principles (GAAP). This press
release also contains certain financial measures such as adjusted
diluted EPS, adjusted EBITDA, adjusted EBITDA margin, organic
revenue, return on invested capital (ROIC) and free cash flow that
are not recognized under GAAP. Management believes that adjusted
diluted EPS, adjusted EBITDA, adjusted EBITDA margin, organic
revenue and ROIC are useful to investors because they allow for
comparison to Carlisle’s and its segments' performance in prior
periods without the effect of items that, by their nature, tend to
obscure core operating results due to potential variability across
periods based on the timing, frequency and magnitude of such items.
Management also believes free cash flow is useful to investors as
an additional way of viewing Carlisle's liquidity and provides a
more complete understanding of factors and trends affecting
Carlisle's cash flows. As a result, management believes that these
measures enhance the ability of investors to analyze trends in
Carlisle’s businesses and evaluate Carlisle’s performance relative
to similarly-situated companies. Reconciliations of these measures
to amounts reported in Carlisle's consolidated financial statements
are in the supplemental schedules of this press release. These
non-GAAP financial measures may not be comparable to similarly
titled measures reported by other companies. Carlisle is not
providing reconciliations for forward-looking non-GAAP financial
measures because Carlisle does not provide GAAP financial measures
on a forward-looking basis as Carlisle is unable to predict with
reasonable certainty the ultimate outcome of adjusted items with
unreasonable effort. There items are uncertain, depend on various
factors, and could be material to Carlisle's financial results
computed in accordance with GAAP.
About Carlisle Companies
Incorporated
Carlisle Companies Incorporated is a leading supplier of
innovative building envelope products and solutions for more energy
efficient buildings. Through its building products businesses –
Carlisle Construction Materials ("CCM") and Carlisle
Weatherproofing Technologies ("CWT") – and family of leading
brands, Carlisle delivers innovative, labor-reducing and
environmentally responsible products and solutions to customers
through the Carlisle Experience. Carlisle is committed to
generating superior shareholder returns and maintaining a balanced
capital deployment approach, including investments in our
businesses, strategic acquisitions, share repurchases and continued
dividend increases. Leveraging its culture of continuous
improvement as embodied in the Carlisle Operating System ("COS"),
Carlisle has committed to achieving net-zero greenhouse gas
emissions by 2050.
Carlisle Companies
Incorporated
Unaudited Consolidated Statements
of Income
Three Months Ended
March 31,
(in millions, except per share
amounts)
2024
2023
Revenues
$
1,096.5
$
892.6
Cost of goods sold
697.6
621.4
Selling and administrative expenses
166.8
142.2
Research and development expenses
9.2
6.8
Other operating (income) expense, net
(2.3
)
1.5
Operating income
225.2
120.7
Interest expense, net
18.6
18.8
Interest income
(7.9
)
(4.5
)
Other non-operating income, net
(0.3
)
(1.0
)
Income from continuing operations before
income taxes
214.8
107.4
Provision for income taxes
43.9
23.8
Income from continuing operations
170.9
83.6
Discontinued operations:
Income before income taxes
21.9
21.2
Provision for income taxes
0.5
3.1
Income from discontinued operations
21.4
18.1
Net income
$
192.3
$
101.7
Basic earnings per share attributable to
common shares:
Income from continuing operations
$
3.57
$
1.63
Income from discontinued operations
0.45
0.36
Basic earnings per share
$
4.02
$
1.99
Diluted earnings per share attributable to
common shares:
Income from continuing operations
$
3.52
$
1.61
Income from discontinued operations
0.45
0.35
Diluted earnings per share
$
3.97
$
1.96
Average shares outstanding:
Basic
47.8
51.1
Diluted
48.4
51.7
Dividends declared and paid per share
$
0.85
$
0.75
Carlisle Companies Incorporated
Unaudited Condensed Consolidated
Statements of Cash Flows
Three Months Ended
March 31,
(in millions)
2024
2023
Net cash provided by operating
activities
$
163.5
$
149.6
Investing activities:
Capital expenditures
(32.5
)
(40.2
)
Investment in securities
0.2
0.5
Other investing activities, net
0.3
8.0
Net cash used in investing activities
(32.0
)
(31.7
)
Financing activities:
Repurchases of common stock
(150.0
)
(50.0
)
Dividends paid
(41.5
)
(38.9
)
Proceeds from exercise of stock
options
42.5
4.8
Withholding tax paid related to
stock-based compensation
(16.2
)
(9.9
)
Other financing activities, net
(0.9
)
(0.8
)
Net cash used in financing activities
(166.1
)
(94.8
)
Effect of foreign currency exchange rate
changes on cash and cash equivalents
(0.7
)
0.8
Change in cash and cash equivalents
(35.3
)
23.9
Less: change in cash and cash equivalents
of discontinued operations
(11.2
)
2.5
Cash and cash equivalents at beginning of
period
576.7
364.7
Cash and cash equivalents at end of
period
$
552.6
$
386.1
Carlisle Companies
Incorporated
Unaudited Selected Consolidated
Balance Sheet Data
(in millions)
March 31, 2024
December 31,
2023
Cash and cash equivalents
$
552.6
$
576.7
Long-term debt, including current
portion
2,289.7
2,289.4
Total stockholders' equity
2,859.3
2,829.0
Carlisle Companies Incorporated
Unaudited Non-GAAP Financial Measures - Organic Revenue
Organic revenue (defined as revenue excluding acquired revenues
within the last 12 months and the impact of changes in foreign
exchange rates versus the U.S. Dollar) is intended to provide
investors and others with information about Carlisle's and its
segments' recurring operating performance. This information differs
from revenue determined in accordance with accounting principles
generally accepted in the United States of America ("GAAP") and
should not be considered in isolation or as a substitute for
measures of performance determined in accordance with GAAP.
Carlisle's and its segments' organic revenue follows, which may not
be comparable to similarly titled measures reported by other
companies.
Three Months Ended March
31,
(in millions, except percentages)
CSL
CCM
CWT
2023 Revenues (GAAP)
$
892.6
$
576.0
$
316.6
Organic
199.2
22.3
%
207.1
35.9
%
(7.9
)
(2.5
)%
Acquisitions
4.0
0.4
%
—
—
%
4.0
1.2
%
FX impact
0.7
0.1
%
0.5
0.1
%
0.2
0.1
%
Total change
203.9
22.8
%
207.6
36.0
%
(3.7
)
(1.2
)%
2024 Revenues (GAAP)
$
1,096.5
$
783.6
$
312.9
Carlisle Companies Incorporated
Unaudited Non-GAAP Financial Measures - Free Cash Flow
Free cash flow is intended to provide investors and others with
information about Carlisle's liquidity and provides a more complete
understanding of factors and trends affecting Carlisle's cash
flows. This information differs from operating cash flow determined
in accordance with GAAP and should not be considered in isolation
or as a substitute for measures of performance determined in
accordance with GAAP. Carlisle's free cash flow follows, which may
not be comparable to similarly titled measures reported by other
companies.
Three Months Ended
March 31,
(in millions)
2024
2023
Operating cash flow (GAAP)
$
163.5
$
149.6
Less: operating cash flow from
discontinued operations
7.5
26.5
Operating cash flow from continuing
operations
$
156.0
$
123.1
Capital expenditures (GAAP)
$
(32.5
)
$
(40.2
)
Less: capital expenditures from
discontinued operations
(8.5
)
(6.8
)
Capital expenditures from continuing
operations
$
(24.0
)
$
(33.4
)
Operating cash flow from continuing
operations
$
156.0
$
123.1
Capital expenditures from continuing
operations
(24.0
)
(33.4
)
Free cash flow from continuing
operations
$
132.0
$
89.7
Carlisle Companies Incorporated
Unaudited Non-GAAP Financial Measures - EBIT, Adjusted EBIT,
Adjusted EBITDA and Adjusted EBITDA Margin
Earnings before interest and taxes ("EBIT"), adjusted EBIT,
adjusted earnings before interest, taxes, depreciation and
amortization ("EBITDA") and adjusted EBITDA margin are intended to
provide investors and others with information about Carlisle's and
its segments' performance without the effect of items that, by
their nature, tend to obscure core operating results due to
potential variability across periods based on the timing, frequency
and magnitude of such items. As a result, management believes that
these measures enhance the ability of investors to analyze trends
in Carlisle's businesses and evaluate Carlisle's performance
relative to similarly-situated companies. This information differs
from net income and operating income determined in accordance with
GAAP and should not be considered in isolation or as a substitute
for measures of performance determined in accordance with GAAP.
Carlisle's and its segments' EBIT, adjusted EBIT, adjusted EBITDA
and adjusted EBITDA margin follows, which may not be comparable to
similarly titled measures reported by other companies.
Three Months Ended
March 31,
(in millions, except percentages)
2024
2023
Net income (GAAP)
$
192.3
$
101.7
Less: Income from discontinued operations
(GAAP)
21.4
18.1
Income from continuing operations
(GAAP)
170.9
83.6
Provision for income taxes
43.9
23.8
Interest expense, net
18.6
18.8
Interest income
(7.9
)
(4.5
)
EBIT
225.5
121.7
Exit and disposal, and facility
rationalization costs
0.5
2.3
Inventory step-up amortization and
transaction costs
0.6
1.6
Impairment charges
—
0.9
Losses from acquisitions and disposals
—
3.9
Gains from litigation
—
(0.2
)
Total non-comparable items
1.1
8.5
Adjusted EBIT
226.6
130.2
Depreciation
16.5
16.1
Amortization
22.4
22.3
Adjusted EBITDA
$
265.5
$
168.6
Divided by:
Total revenues
$
1,096.5
$
892.6
Adjusted EBITDA margin
24.2
%
18.9
%
Carlisle Companies Incorporated
Unaudited Non-GAAP Financial Measures - EBIT, Adjusted EBIT,
Adjusted EBITDA and Adjusted EBITDA Margin
Three Months Ended March 31,
2024
(in millions, except percentages)
CCM
CWT
Corporate and
unallocated
Operating income (loss) (GAAP)
$
211.2
$
42.2
$
(28.2
)
Non-operating expense (income), net(1)
0.4
—
(0.7
)
EBIT
210.8
42.2
(27.5
)
Exit and disposal, and facility
rationalization costs
—
0.5
—
Inventory step-up amortization and
transaction costs
—
—
0.6
(Gains) losses from acquisitions and
disposals
(0.1
)
0.1
—
Total non-comparable items
(0.1
)
0.6
0.6
Adjusted EBIT
210.7
42.8
(26.9
)
Depreciation
12.0
4.1
0.4
Amortization
4.1
17.8
0.5
Adjusted EBITDA
$
226.8
$
64.7
$
(26.0
)
Divided by:
Total revenues
$
783.6
$
312.9
$
—
Adjusted EBITDA margin
28.9
%
20.7
%
NM
- Includes other non-operating (income) expense, net, which may
be presented in separate line items on the unaudited Consolidated
Statements of Income.
Three Months Ended March 31,
2023
(in millions, except percentages)
CCM
CWT
Corporate and
unallocated
Operating income (loss) (GAAP)
$
122.4
$
24.1
$
(25.8
)
Non-operating income, net(1)
(0.1
)
(0.2
)
(0.7
)
EBIT
122.5
24.3
(25.1
)
Exit and disposal, and facility
rationalization costs
0.1
2.2
—
Inventory step-up amortization and
transaction costs
—
—
1.6
Impairment charges
—
0.9
—
(Gains) losses from acquisitions and
disposals
(0.2
)
4.1
—
Gains from litigation
—
—
(0.2
)
Total non-comparable items
(0.1
)
7.2
1.4
Adjusted EBIT
122.4
31.5
(23.7
)
Depreciation
10.3
4.8
1.0
Amortization
4.1
17.6
0.6
Adjusted EBITDA
$
136.8
$
53.9
$
(22.1
)
Divided by:
Total revenues
$
576.0
$
316.6
$
—
Adjusted EBITDA margin
23.8
%
17.0
%
NM
- Includes other non-operating (income) expense, net, which may
be presented in separate line items on the unaudited Consolidated
Statements of Income.
Carlisle Companies Incorporated
Unaudited Non-GAAP Financial Measures - Adjusted Net Income and
Adjusted Diluted EPS
Adjusted net income and adjusted diluted earnings per share is
intended to provide investors and others with information about
Carlisle's performance without the effect of items that, by their
nature, tend to obscure Carlisle's core operating results due to
potential variability across periods based on the timing, frequency
and magnitude of such items. This information differs from net
income and diluted earnings per share determined in accordance with
GAAP and should not be considered in isolation or as a substitute
for measures of performance determined in accordance with GAAP.
Carlisle's adjusted net income and adjusted diluted earnings per
share follows, which may not be comparable to similarly titled
measures reported by other companies.
Three Months Ended
March 31, 2024
Three Months Ended
March 31, 2023
(in millions, except per share
amounts)
Pre-tax
Impact
After-tax
Impact(1)
Impact to Diluted
EPS(2)
Pre-tax
Impact
After-tax
Impact(1)
Impact to Diluted
EPS(2)
Net income (GAAP)
$
192.3
$
3.97
$
101.7
$
1.96
Less: Income from discontinued operations
(GAAP)
21.4
0.45
18.1
0.35
Income from continuing operations
(GAAP)
170.9
3.52
83.6
1.61
Exit and disposal, and facility
rationalization costs
0.5
0.3
0.01
2.3
1.8
0.03
Inventory step-up amortization and
transaction costs
0.6
0.5
0.01
1.6
1.2
0.02
Impairment charges
—
—
—
0.9
0.7
0.01
Losses from acquisitions and disposals
—
—
—
3.9
2.9
0.06
Gains from litigation
—
—
—
(0.2
)
(0.1
)
—
Acquisition-related amortization(3)
21.0
15.8
0.32
21.0
15.8
0.31
Discrete tax items(4)
—
(7.0
)
(0.14
)
—
(1.7
)
(0.03
)
Total adjustments
9.6
0.20
20.6
0.40
Adjusted net income
$
180.5
$
3.72
$
104.2
$
2.01
- The impact to net income reflects the tax effect of noted
items, which is based on the statutory rate in the jurisdiction in
which the expense or income is deductible or taxable.
- The per share impact of adjustments to each period is based on
diluted shares outstanding using the two-class method.
- Acquisition-related amortization includes the amortization of
customer relationships, technology, trade names and other
intangible assets recorded in purchase accounting in connection
with a business combination. These intangible assets contribute to
revenue generation and the amortization of these assets will recur
until such intangible assets are fully amortized.
- Discrete tax items include current period tax expense or
benefit related to prior year items, excess tax benefits from stock
compensation, the tax impact of foreign currency gains and losses,
or changes in tax laws or rates.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240425228345/en/
Mehul Patel Vice President, Investor Relations (310) 592-9668
mpatel@carlisle.com
Carlisle Companies (NYSE:CSL)
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