Yahoo Finance Carlisle Companies Inc (CSL) (Q1 2024) Earnings Call Transcript Highlights: Stellar Growth and ...
First Quarter Sales: $1.1 billion, a 23% year-over-year increase.
Adjusted EBITDA: Over $260 million, marking an increase of over 50% year-over-year.
Adjusted EPS: Growth of over 80% year-over-year.
CCM Business Sales: $784 million, up 36% from Q1 2023.
CCM Adjusted EBITDA: Increased 66% to $227 million.
CWT Business Revenue: Decreased 1% year-over-year.
CWT Adjusted EBITDA: Grew 20% to $65 million.
Share Repurchases: $150 million completed in Q1 as part of a $1.4 billion plan for 2024.
Dividends: $42 million paid in Q1.
Free Cash Flow Margin: 12% for the quarter, on track for over 15% for the full year.
Net Leverage Ratio: 1.4x, within the target range of 1 to 2x.
Full Year 2024 Revenue Outlook: Raised to approximately 10% growth.
Adjusted EBITDA Margin Outlook: Expected to expand by at least 100 basis points.
Release Date: April 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: What have you seen in your business to get comfort or confidence that there is pent-up demand on the reroofing side? A: (Kevin P. Zdimal - VP & CFO, Carlisle Companies Incorporated) The pent-up demand for reroofing is largely a result of COVID-19 disruptions, where contractors were initially unable to access roofs. Post-COVID, there was a surge in new construction, and due to labor shortages, some reroofing was deferred, leading to the current pent-up demand. This has significantly influenced our decision to raise our forecast.
Q: Can you provide more details on the revenue bridge within CCM, particularly how restocking, underlying volume, and updated price assumptions are contributing to growth? A: (Kevin P. Zdimal - VP & CFO, Carlisle Companies Incorporated) The destocking component remains unchanged at about 11% increase for the year. The volume and price have changed; reroofing is now expected to be up mid-single digits, and pricing is anticipated to be down about 1% for the full year, improved from previous estimates of a 2-3% decline.
Q: How are you managing the pace of input costs, particularly MDI and polyiso, and how does this affect your EBITDA line? A: (Kevin P. Zdimal - VP & CFO, Carlisle Companies Incorporated) The raw materials costs have been mixed, with some up and some down, but overall, they are relatively flat. With the recent price increases, we expect a positive impact of about $20 million on the price-cost for the full year.
Q: Can you discuss any initiatives around products and customer work in CCM that might be adding to the reroofing tailwind? A: (D. Christian Koch - Chairman, President & CEO, Carlisle Companies Incorporated) Initiatives include enhancing customer intimacy through training and improving digital experiences, boosting innovation with new products like the 16-foot TPO and ReadyFlash, and operational excellence through AI and sustainability efforts in factories. These initiatives are beginning to reflect in sales and are expected to continue gaining momentum.
Q: What is driving the incremental $20 million in synergies at Henry, and how will this impact the financials? A: (D. Christian Koch - Chairman, President & CEO, Carlisle Companies Incorporated) The increased synergies from Henry are driven by cross-selling, sales automation, and improved factory efficiencies. These synergies are already reflected in the financials, contributing significantly to the EBITDA growth.
Q: How is the architectural metals market evolving, and how does the MTL acquisition fit into Carlisle's strategy? A: (D. Christian Koch - Chairman, President & CEO, Carlisle Companies Incorporated) The architectural metals market is growing at approximately twice the rate of GDP. MTL's focus on edge metal and architectural products, which are highly specified and patented, aligns with Carlisle's strategy to enhance its product portfolio and drive synergies in raw material purchases and shipping.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
