8-K
MYERS INDUSTRIES INC (MYE)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): August 5, 2021
Myers Industries, Inc.
(Exact Name of Registrant as Specified in Charter)
| Ohio | 001-8524 | 34-0778636 |
|---|---|---|
| (State or Other Jurisdiction<br><br><br>of Incorporation) | (Commission<br><br><br>File Number) | (I.R.S. Employer<br><br><br>Identification No.) |
1293 South Main Street, Akron, Ohio 44301
(Address of Principal Executive Offices, and Zip Code)
(330) 253-5592
Registrant’s Telephone Number, Including Area Code
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered |
|---|---|---|
| Common Stock, without par value | MYE | The New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. |
|---|
On August 5, 2021, Myers Industries, Inc. (the “Company”) issued a press release announcing earnings results for the second quarter ended June 30, 2021. The full text of the press release issued in connection with the announcement is attached as Exhibit 99.1 to this Current Report on Form 8-K. In addition, a copy of the presentation which will be discussed during the Company’s earnings conference call at 8:30 a.m. Eastern Time on August 5, 2021, is available on the Investor Relations section of the Company’s website at www.myersindustries.com. Information about the Company’s earnings conference call can be found in the press release attached as Exhibit 99.1 to this Current Report on Form 8-K.
Pursuant to General Instruction B.2 of Current Report on Form 8-K, the information in this Item 2.02 and Exhibit 99.1 is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section. Furthermore, the information in this Item 2.02 and Exhibit 99.1 shall not be deemed to be incorporated by reference into the filings of the Company under the Securities Act of 1933, as amended (the “Securities Act”), except as may be expressly set forth by specific reference in such filing.
| Item 7.01 | Regulation FD Disclosure. |
|---|
As described in “Item 2.02 Results of Operations and Financial Condition” above, on August 5, 2021, the Company issued a press release announcing earnings results for the second quarter ended June 30, 2021. The full text of the press release issued in connection with the announcement is attached as Exhibit 99.1 to this Current Report on Form 8-K. In addition, a copy of the presentation which will be discussed during the Company’s earnings conference call at 8:30 a.m. Eastern Time on August 5, 2021, is available on the Investor Relations section of the Company’s website at www.myersindustries.com. Information about the Company’s earnings conference call can be found in the press release attached as Exhibit 99.1 to this Current Report on Form 8-K.
Pursuant to General Instruction B.2 of Current Report on Form 8-K, the information in this Item 7.01 and Exhibit 99.1 is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section. Furthermore, the information in this Item 7.01 and Exhibit 99.1 shall not be deemed to be incorporated by reference into the filings of the Company under the Securities Act, except as may be expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
|---|
(d) Exhibits.
| Exhibit<br><br><br>Number | Description |
|---|---|
| 99.1 | Press Release, dated August 5, 2021 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Myers Industries, Inc. | |||
|---|---|---|---|
| By: | /s/ Sonal P. Robinson | ||
| Sonal P. Robinson | |||
| Executive Vice President and Chief Financial Officer | |||
| Date: August 5, 2021 |
mye-ex991_6.htm
Exhibit 99.1
Myers Industries Reports 2021 Second Quarter Results
Increased Demand and Focused Execution Drive Continued Strong Sales Growth
Sales Increased 32% on an Organic Basis, 58% Including Elkhart Acquisition
Recent Acquisition of Trilogy Plastics and Updated Corporate Brand Identity
Reinforces “One Myers” Strategic Vision
August 5, 2021, Akron, Ohio - Myers Industries, Inc. (NYSE: MYE), a leading manufacturer of a wide range of polymer products and distributor for the tire, wheel, and under-vehicle service industry, today announced results for the second quarter ended June 30, 2021.
Second Quarter 2021 Financial Highlights
| • | Net sales increased $69.0 million, or 58.3% to $187.4 million, including $30.9 million, or 26.1% from the Elkhart Plastics acquisition, compared with $118.4 million for the second quarter of 2020 |
|---|---|
| • | Net income per diluted share was $0.30, compared with $0.23 for the second quarter of 2020 |
| --- | --- |
| • | Adjusted earnings per diluted share was $0.29, compared with $0.23 for the second quarter of 2020 |
| --- | --- |
| • | Cash flow from operations was $14.7 million and free cash flow was $11.7 million, compared with $6.8 million and $3.7 million, respectively, for the second quarter of 2020 |
| --- | --- |
Myers Industries’ President and CEO, Mike McGaugh said, “The team’s ability to strategically manage the dynamic macro environment over the past few months is indicative of our overall strong operational performance during the first half of 2021. We continued to see increased demand from our core end-markets, which led to higher volumes across our business. Despite strong volume growth, our second quarter results were impacted by continued raw material inflation, which did outpace our price increases. We’ve continued to take incremental pricing actions to offset these unprecedented increases in raw material costs.”
McGaugh added, “Additionally, we continue to make progress in achieving our ‘One Myers’ strategic vision. Earlier this week, we announced the acquisition of Trilogy Plastics which comes after the successful integration of the Elkhart business over the last nine months. We are very excited to welcome the Trilogy team to the Myers family and are eager to move forward together as a leading producer of high-quality molded plastic products. We believe this combination will bring additional opportunities in the rotational molding industry and allow us to continue to raise the standard of commercial excellence and customer service within our industry.”
McGaugh concluded, “We also recently unveiled our updated corporate brand identity. This new visual identity is another important step in our strategic transformation. We look forward to continuing to advance our culture towards our ‘One Myers’ initiative while further driving our values of integrity, optimism, customer focus and can-do spirit throughout our operations.”
Second Quarter 2021 Financial Summary
| Quarter Ended June 30, | |||
|---|---|---|---|
| 2021 | 2020 | Inc (Dec) | |
| (Dollars in millions, except per share data) | |||
| Net sales | $187.4 | $118.4 | 58.3% |
| Operating income | $15.9 | $12.3 | 29.5% |
| Adjusted operating income | $15.1 | $12.3 | 23.2% |
| Adjusted operating income margin | 8.1% | 10.4% | -230 bps |
| Net income | $11.1 | $8.4 | 32.3% |
| Adjusted net income | $10.4 | $8.2 | 27.5% |
| Net income per diluted share | $0.30 | $0.23 | 30.4% |
| Adjusted earnings per diluted share | $0.29 | $0.23 | 26.1% |
Net sales for the second quarter of 2021 were $187.4 million, an increase of $69.0 million, or 58.3%, compared with $118.4 million for the second quarter of 2020, driven by increases in both the Material Handling and Distribution segments. Excluding the $30.9 million net sales impact from the Elkhart acquisition, organic net sales increased 26% due to higher volume/mix, 5% due to favorable price and 1% due to foreign currency exchange.
Gross profit increased $12.4 million, or 29.2% to $55.0 million, primarily due to the increased contribution from volume/mix and the Elkhart Plastics acquisition. Partially offsetting these contributions were higher raw material costs, primarily resin, which were not fully recovered by pricing actions and led to an unfavorable price-to-cost relationship for the quarter. As a result, gross margin was 29.4% compared with 36.0% for the second quarter of 2020. Selling, general and administrative expenses increased $9.8 million, or 32.3% to $40.1 million, reflecting the Elkhart Plastics acquisition, higher salaries and incentive compensation and an increase in legal fees, partially offset by lower amortization expense. SG&A as a percentage of sales declined to 21.4% in the second quarter, compared with 25.6% in the same period last year. Net income per diluted share was $0.30, compared with $0.23 for the second quarter of 2020. Adjusted earnings per diluted share were $0.29, compared with $0.23 for the second quarter of 2020.
Second Quarter 2021 Segment Results
(Dollar amounts in the segment tables below are reported in millions)
Material Handling
| Net Sales | Op Income | Adj Op Income | Adj Op Income Margin | |
|---|---|---|---|---|
| Q2 2021 Results | $137.2 | $17.9 | $17.0 | 12.4% |
| Increase (decrease) vs prior year | 69.7% | 13.3% | 7.7% | -710 bps |
Net sales for the second quarter of 2021 were $137.2 million, an increase of $56.4 million, or 69.7%, compared with $80.9 million for the second quarter of 2020. Excluding the $30.9 million net sales impact from the Elkhart acquisition, organic net sales increased 24% due to higher volume/mix, 6% due to favorable price and 2% due to foreign currency exchange. Sales increased in the vehicle, industrial, food and beverage, and consumer end markets. Operating income increased 13.3% to $17.9 million, compared with $15.8 million in 2020. Adjusted operating income increased to $17.0 million, compared with $15.8 million in 2020. The increase was primarily due to increased volume/mix and the Elkhart Plastics acquisition. Partially offsetting these contributions were higher raw material costs, primarily resin, which were not fully recovered by pricing actions and led to an unfavorable price-to-cost relationship for the quarter. Additionally, SG&A expenses were higher year-over-year. The increase in SG&A expenses was primarily due to the Elkhart Plastics acquisition, higher salaries and incentive compensation costs, increased travel costs and higher legal fees, partially offset by a decrease in amortization expense. The Material Handling Segment’s adjusted operating income margin was 12.4%, compared with 19.5% for the second quarter of 2020.
Distribution
| Net Sales | Op Income | Adj Op Income | Adj Op Income Margin | |
|---|---|---|---|---|
| Q2 2021 Results | $50.2 | $4.2 | $4.2 | 8.4% |
| Increase vs prior year | 33.6% | 157.6% | 157.6% | +400 bps |
Net sales for the second quarter of 2021 were $50.2 million, an increase of $12.6 million, or 33.6%, compared with $37.5 million for the second quarter of 2020. The increase was driven by higher volume/mix across both equipment and supplies. Operating income increased to $4.2 million, compared with $1.6 million in 2020. The increase in operating income was largely due to contributions from higher volume/mix, partially offset by higher incentive compensation costs. The Distribution Segment’s adjusted operating income margin was 8.4%, compared with 4.4% for the second quarter of 2020.
2021 Outlook
The Company updated its outlook for fiscal 2021, and currently forecasts:
| • | Net sales growth in the mid 40% range, with approximately half due to the Elkhart and Trilogy acquisitions |
|---|---|
| • | Diluted EPS in the range of $0.86 to $1.01; adjusted diluted EPS in the range of $0.90 to $1.05 |
| --- | --- |
| • | Capital expenditures to approximate $15 to $18 million |
| --- | --- |
| • | Effective tax rate to approximate 26% |
| --- | --- |
Conference Call Details
The Company will host an earnings conference call and webcast for investors and analysts on Thursday, August 5, 2021, at 8:30 a.m. EDT. The call is anticipated to last less than one hour and may be accessed using the following online participation registration link: https://www.incommglobalevents.com/viewer/13353/myers-industries-2021-second-quarter-earnings-call/. Upon registering, each participant will be provided with call details and a registrant ID that will be used to track call attendance. Reminders will also be sent to registered participants via email. The live webcast of the conference call can be accessed from the Investor Relations section of the Company's website at www.myersindustries.com. Click on the Investor Relations tab to access the webcast. Webcast attendees will be in a listen-only mode. An archived replay of the call will also be available on the site shortly after the event. To access a replay of the event, please use the following link: https://www.incommglobalevents.com/replay/6525/myers-industries-2021-second-quarter-earnings-call/. The access code is 253552.
Use of Non-GAAP Financial Measures
The Company uses certain non-GAAP measures in this release. Adjusted gross profit, adjusted gross profit margin, adjusted operating income (loss), adjusted operating income margin, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted EBITDA margin, adjusted income (loss) before taxes, adjusted net income, adjusted earnings per diluted share, and free cash flow are non-GAAP financial measures and are intended to serve as a supplement to results provided in accordance with accounting principles generally accepted in the United States. Myers Industries believes that such information provides an additional measurement and consistent historical comparison of the Company’s performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release.
About Myers Industries
Myers Industries, Inc. is a manufacturer of polymer products for industrial, agricultural, automotive, commercial, and consumer markets. The Company is also the largest distributor of tools, equipment and supplies for the tire, wheel, and under-vehicle service industry in the United States. Visit www.myersindustries.com to learn more.
Caution on Forward-Looking Statements
Statements in this release include “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statement that is not of historical fact may be deemed “forward-looking”. Words such as “will”, “expect”, “believe”, “project”, “plan”, “anticipate”, “intend”, “objective”, “outlook”, “target”, “goal”, “view” and similar expressions identify forward-looking statements. These statements are based on management's current views and assumptions of future events and financial performance and involve a number of risks and uncertainties, many outside of the Company's control that could cause actual results to materially differ from those expressed or implied. Risks and uncertainties include: impacts from the COVID-19 pandemic on our
business, conditions, customers and capital position; the impact of COVID-19 on local, national and global economic conditions; the effects of various governmental responses to the COVID-19 pandemic, raw material availability, increases in raw material costs, or other production costs; impacts of price increases, risks associated with our strategic growth initiatives or the failure to achieve the anticipated benefits of such initiatives; unanticipated downturn in business relationships with customers or their purchases; competitive pressures on sales and pricing; changes in the markets for the Company’s business segments; changes in trends and demands in the markets in which the Company competes; operational problems at our manufacturing facilities, or unexpected failures at those facilities; future economic and financial conditions in the United States and around the world; inability of the Company to meet future capital requirements; claims, litigation and regulatory actions against the Company; changes in laws and regulations affecting the Company; impact of the U.S. elections impacts on the regulatory landscape, capital markets, and responses to and management of the COVID-19 pandemic including further economic stimulus from the federal government; and other important factors detailed previously and from time to time in the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 and subsequent Quarterly Reports on Form 10-Q. Such reports are available on the Securities and Exchange Commission's public reference facilities and its website at www.sec.gov and on the Company's Investor Relations section of its website at www.myersindustries.com. Myers Industries undertakes no obligation to publicly update or revise any forward-looking statements contained herein. These statements speak only as of the date made.
Contact:
Monica Vinay
Vice President, Investor Relations & Treasurer
(330) 761-6212
MYERS INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in thousands, except share and per share data)
| Quarter Ended | Six Months Ended | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30, 2021 | June 30, 2020 | June 30, 2021 | June 30, 2020 | ||||||||
| Net sales | $ | 187,369 | $ | 118,394 | $ | 361,798 | $ | 240,644 | |||
| Cost of sales | 132,375 | 75,821 | 256,391 | 155,588 | |||||||
| Gross profit | 54,994 | 42,573 | 105,407 | 85,056 | |||||||
| Selling, general and administrative expenses | 40,121 | 30,317 | 79,669 | 61,433 | |||||||
| Gain on disposal of fixed assets | (996 | ) | — | (996 | ) | (7 | ) | ||||
| Gain on sale of notes receivable | — | — | — | (11,924 | ) | ||||||
| Operating income (loss) | 15,869 | 12,256 | 26,734 | 35,554 | |||||||
| Interest expense, net | 999 | 1,194 | 1,994 | 2,263 | |||||||
| Income (loss) before income taxes | 14,870 | 11,062 | 24,740 | 33,291 | |||||||
| Income tax expense (benefit) | 3,795 | 2,694 | 6,360 | 8,197 | |||||||
| Net income (loss) | $ | 11,075 | $ | 8,368 | $ | 18,380 | $ | 25,094 | |||
| Net income (loss) per common share: | |||||||||||
| Basic | $ | 0.31 | $ | 0.23 | $ | 0.51 | $ | 0.70 | |||
| Diluted | $ | 0.30 | $ | 0.23 | $ | 0.51 | $ | 0.70 | |||
| Weighted average common shares outstanding: | |||||||||||
| Basic | 36,122,792 | 35,774,241 | 36,058,061 | 35,749,110 | |||||||
| Diluted | 36,336,448 | 35,920,465 | 36,296,003 | 35,899,521 |
MYERS INDUSTRIES, INC.
SALES AND EARNINGS BY SEGMENT (UNAUDITED)
(Dollars in thousands)
| Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | % Change | 2021 | 2020 | % Change | |||||||||||||
| Net sales | ||||||||||||||||||
| Material Handling | $ | 137,227 | $ | 80,855 | 69.7 | % | $ | 267,120 | $ | 164,931 | 62.0 | % | ||||||
| Distribution | 50,156 | 37,541 | 33.6 | % | $ | 94,706 | $ | 75,736 | 25.0 | % | ||||||||
| Inter-company Sales | (14 | ) | (2 | ) | - | $ | (28 | ) | $ | (23 | ) | - | ||||||
| Total | $ | 187,369 | $ | 118,394 | 58.3 | % | $ | 361,798 | $ | 240,644 | 50.3 | % | ||||||
| Operating income (loss) | ||||||||||||||||||
| Material Handling | $ | 17,902 | $ | 15,796 | 13.3 | % | $ | 34,829 | $ | 30,963 | 12.5 | % | ||||||
| Distribution | 4,214 | 1,636 | 157.6 | % | 5,652 | 3,486 | 62.1 | % | ||||||||||
| Corporate | (6,247 | ) | (5,176 | ) | - | (13,747 | ) | 1,105 | - | |||||||||
| Total | $ | 15,869 | $ | 12,256 | 29.5 | % | $ | 26,734 | $ | 35,554 | (24.8 | )% | ||||||
| Adjusted operating income (loss) | ||||||||||||||||||
| Material Handling | $ | 17,009 | $ | 15,796 | 7.7 | % | $ | 33,936 | $ | 30,963 | 9.6 | % | ||||||
| Distribution | 4,214 | 1,636 | 157.6 | % | 6,179 | 3,503 | 76.4 | % | ||||||||||
| Corporate | (6,123 | ) | (5,176 | ) | - | (13,162 | ) | (10,535 | ) | - | ||||||||
| Total | $ | 15,100 | $ | 12,256 | 23.2 | % | $ | 26,953 | $ | 23,931 | 12.6 | % | ||||||
| Adjusted operating income margin | ||||||||||||||||||
| Material Handling | 12.4 | % | 19.5 | % | 12.7 | % | 18.8 | % | ||||||||||
| Distribution | 8.4 | % | 4.4 | % | 6.5 | % | 4.6 | % | ||||||||||
| Corporate | n/a | n/a | n/a | n/a | ||||||||||||||
| Total | 8.1 | % | 10.4 | % | 7.4 | % | 9.9 | % | ||||||||||
| Adjusted EBITDA | ||||||||||||||||||
| Material Handling | $ | 21,727 | $ | 20,926 | 3.8 | % | $ | 43,173 | $ | 41,123 | 5.0 | % | ||||||
| Distribution | 4,761 | 2,244 | 112.2 | % | 7,269 | 4,706 | 54.5 | % | ||||||||||
| Corporate | (6,018 | ) | (5,077 | ) | - | (12,959 | ) | (10,336 | ) | - | ||||||||
| Total | $ | 20,470 | $ | 18,093 | 13.1 | % | $ | 37,483 | $ | 35,493 | 5.6 | % | ||||||
| Adjusted EBITDA margin | ||||||||||||||||||
| Material Handling | 15.8 | % | 25.9 | % | 16.2 | % | 24.9 | % | ||||||||||
| Distribution | 9.5 | % | 6.0 | % | 7.7 | % | 6.2 | % | ||||||||||
| Corporate | n/a | n/a | n/a | n/a | ||||||||||||||
| Total | 10.9 | % | 15.3 | % | 10.4 | % | 14.7 | % |
MYERS INDUSTRIES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED)
(Dollars in thousands)
| Distribution | Segment Total | Corporate & Other | Total | |||||||||||
| Net sales | 137,227 | $ | 50,156 | $ | 187,383 | $ | (14 | ) | $ | 187,369 | ||||
| Gross profit | 54,994 | |||||||||||||
| Add: Restructuring expenses and other adjustments | 102 | |||||||||||||
| Adjusted gross profit | 55,096 | |||||||||||||
| Gross margin | 29.4 | % | ||||||||||||
| Operating income (loss) | 17,902 | 4,214 | 22,116 | (6,247 | ) | 15,869 | ||||||||
| Add: Acquisition and integration costs | — | — | — | 124 | 124 | |||||||||
| Add: Restructuring expenses and other adjustments (1) | 102 | — | 102 | — | 102 | |||||||||
| Less: Gain on sale of assets | (995 | ) | — | (995 | ) | — | (995 | ) | ||||||
| Adjusted operating income (loss) | 17,009 | 4,214 | 21,223 | (6,123 | ) | 15,100 | ||||||||
| Adjusted operating income margin | 12.4 | % | 8.4 | % | 11.3 | % | n/a | 8.1 | % | |||||
| Add: Depreciation and amortization | 4,718 | 547 | 5,265 | 105 | 5,370 | |||||||||
| Adjusted EBITDA | 21,727 | $ | 4,761 | $ | 26,488 | $ | (6,018 | ) | $ | 20,470 | ||||
| Adjusted EBITDA margin | 15.8 | % | 9.5 | % | 14.1 | % | n/a | 10.9 | % | |||||
| (1) Includes gross profit adjustment of 102 | ||||||||||||||
| Distribution | Segment Total | Corporate & Other | Total | |||||||||||
| Net sales | 80,855 | $ | 37,541 | $ | 118,396 | $ | (2 | ) | $ | 118,394 | ||||
| Gross profit | 42,573 | |||||||||||||
| Gross margin | 36.0 | % | ||||||||||||
| Operating income (loss) | 15,796 | 1,636 | 17,432 | (5,176 | ) | 12,256 | ||||||||
| Operating income margin | 19.5 | % | 4.4 | % | 14.7 | % | n/a | 10.4 | % | |||||
| Add: Depreciation and amortization | 5,130 | 608 | 5,738 | 99 | 5,837 | |||||||||
| EBITDA | 20,926 | $ | 2,244 | $ | 23,170 | $ | (5,077 | ) | $ | 18,093 | ||||
| EBITDA margin | 25.9 | % | 6.0 | % | 19.6 | % | n/a | 15.3 | % |
All values are in US Dollars.
MYERS INDUSTRIES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED)
(Dollars in thousands)
| Distribution | Segment Total | Corporate & Other | Total | |||||||||||
| Net sales | 267,120 | $ | 94,706 | $ | 361,826 | $ | (28 | ) | $ | 361,798 | ||||
| Gross profit | 105,407 | |||||||||||||
| Add: Restructuring expenses and other adjustments | 102 | |||||||||||||
| Adjusted gross profit | 105,509 | |||||||||||||
| Gross margin | 29.2 | % | ||||||||||||
| Operating income (loss) | 34,829 | 5,652 | 40,481 | (13,747 | ) | 26,734 | ||||||||
| Add: Severance costs | — | 527 | 527 | 318 | 845 | |||||||||
| Add: Acquisition and integration costs | — | — | — | 267 | 267 | |||||||||
| Add: Restructuring expenses and other adjustments (1) | 102 | — | 102 | — | 102 | |||||||||
| Less: Gain on sale of assets | (995 | ) | — | (995 | ) | — | (995 | ) | ||||||
| Adjusted Operating income (loss) | 33,936 | 6,179 | 40,115 | (13,162 | ) | 26,953 | ||||||||
| Adjusted operating income margin | 12.7 | % | 6.5 | % | 11.1 | % | n/a | 7.4 | % | |||||
| Add: Depreciation and amortization | 9,237 | 1,090 | 10,327 | 203 | 10,530 | |||||||||
| Adjusted EBITDA | 43,173 | $ | 7,269 | $ | 50,442 | $ | (12,959 | ) | $ | 37,483 | ||||
| Adjusted EBITDA margin | 16.2 | % | 7.7 | % | 13.9 | % | n/a | 10.4 | % | |||||
| (1) Includes gross profit adjustment of 102 | ||||||||||||||
| Distribution | Segment Total | Corporate & Other | Total | |||||||||||
| Net sales | 164,931 | $ | 75,736 | $ | 240,667 | $ | (23 | ) | $ | 240,644 | ||||
| Gross profit | 85,056 | |||||||||||||
| Gross margin | 35.3 | % | ||||||||||||
| Operating income (loss) | 30,963 | 3,486 | 34,449 | 1,105 | 35,554 | |||||||||
| Add: Restructuring expenses and other adjustments | — | — | — | 249 | 249 | |||||||||
| Add: Acquisition and integration costs | — | 17 | 17 | 35 | 52 | |||||||||
| Less: Lawn and Garden sale of note/release of lease guarantee liability | — | — | — | (11,924 | ) | (11,924 | ) | |||||||
| Adjusted operating income (loss) | 30,963 | 3,503 | 34,466 | (10,535 | ) | 23,931 | ||||||||
| Adjusted operating income margin | 18.8 | % | 4.6 | % | 14.3 | % | n/a | 9.9 | % | |||||
| Add: Depreciation and amortization | 10,160 | 1,203 | 11,363 | 199 | 11,562 | |||||||||
| Adjusted EBITDA | 41,123 | $ | 4,706 | $ | 45,829 | $ | (10,336 | ) | $ | 35,493 | ||||
| Adjusted EBITDA margin | 24.9 | % | 6.2 | % | 19.0 | % | n/a | 14.7 | % |
All values are in US Dollars.
MYERS INDUSTRIES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
INCOME AND EARNINGS PER DILUTED SHARE (UNAUDITED)
(Dollars in thousands, except per share data)
| Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Operating income (loss) | $ | 15,869 | $ | 12,256 | $ | 26,734 | $ | 35,554 | ||||
| Add: Severance costs | — | — | 845 | — | ||||||||
| Add: Restructuring expenses and other adjustments | 102 | — | 102 | 249 | ||||||||
| Add: Acquisition and integration costs | 124 | — | 267 | 52 | ||||||||
| Less: Gain on sale of assets | (995 | ) | — | (995 | ) | — | ||||||
| Less: Lawn and Garden sale of note/release of lease guarantee liability | — | — | — | (11,924 | ) | |||||||
| Adjusted operating income (loss) | 15,100 | 12,256 | 26,953 | 23,931 | ||||||||
| Less: Interest expense, net | (999 | ) | (1,194 | ) | (1,994 | ) | (2,263 | ) | ||||
| Adjusted income (loss) before taxes | 14,101 | 11,062 | 24,959 | 21,668 | ||||||||
| Less: Income tax expense^(1)^ | (3,666 | ) | (2,876 | ) | (6,489 | ) | (5,634 | ) | ||||
| Adjusted net income (loss) | $ | 10,435 | $ | 8,186 | $ | 18,470 | $ | 16,034 | ||||
| Adjusted earnings per diluted share | $ | 0.29 | $ | 0.23 | $ | 0.51 | $ | 0.45 | ||||
| (1) Income taxes are calculated using the normalized effective tax rate for each year. The rate used in 2021 and 2020 is 26%. | ||||||||||||
| (2) Adjusted earnings per diluted share is calculated using the weighted average common shares outstanding for the respective period. |
MYERS INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)
(Dollars in thousands)
| June 30, 2021 | December 31, 2020 | |||
|---|---|---|---|---|
| Assets | ||||
| Current Assets | ||||
| Cash | $ | 13,543 | $ | 28,301 |
| Accounts receivable, net | 98,610 | 83,701 | ||
| Income tax receivable | — | 1,049 | ||
| Inventories, net | 79,482 | 65,919 | ||
| Prepaid expenses and other current assets | 9,576 | 4,760 | ||
| Total Current Assets | 201,211 | 183,730 | ||
| Property, plant, & equipment, net | 83,981 | 73,953 | ||
| Right of use asset - operating leases | 22,834 | 18,390 | ||
| Deferred income taxes | 84 | 84 | ||
| Other assets | 122,365 | 123,858 | ||
| Total Assets | $ | 430,475 | $ | 400,015 |
| Liabilities & Shareholders' Equity | ||||
| Current Liabilities | ||||
| Accounts payable | $ | 81,614 | $ | 61,150 |
| Accrued expenses | 40,210 | 36,744 | ||
| Operating lease liability - short-term | 4,833 | 4,359 | ||
| Finance lease liability - short-term | 491 | — | ||
| Long-term debt - current portion | — | 39,994 | ||
| Total Current Liabilities | 127,148 | 142,247 | ||
| Long-term debt | 57,833 | 37,582 | ||
| Operating lease liability - long-term | 17,778 | 13,755 | ||
| Finance lease liability - long-term | 9,688 | — | ||
| Other liabilities | 14,174 | 14,373 | ||
| Deferred income taxes | 1,873 | 2,958 | ||
| Total Shareholders' Equity | 201,981 | 189,100 | ||
| Total Liabilities & Shareholders' Equity | $ | 430,475 | $ | 400,015 |
MYERS INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Dollars in thousands)
| Six Months Ended June 30, | ||||||
|---|---|---|---|---|---|---|
| 2021 | 2020 | |||||
| Cash Flows From Operating Activities | ||||||
| Net income | $ | 18,380 | $ | 25,094 | ||
| Adjustments to reconcile net income to net cash<br><br><br>provided by (used for) operating activities | ||||||
| Depreciation | 8,142 | 7,243 | ||||
| Amortization | 2,610 | 4,518 | ||||
| Non-cash stock-based compensation expense | 1,829 | 1,346 | ||||
| Gain on disposal of fixed assets | (996 | ) | (7 | ) | ||
| Gain on sale of notes receivable | — | (11,924 | ) | |||
| Other | (702 | ) | 407 | |||
| Other long-term liabilities | (205 | ) | 478 | |||
| Cash flows provided by (used for) working capital | ||||||
| Accounts receivable | (15,250 | ) | (9,672 | ) | ||
| Inventories | (13,411 | ) | (5,453 | ) | ||
| Prepaid expenses and other current assets | (4,814 | ) | (2,926 | ) | ||
| Accounts payable and accrued expenses | 25,718 | 2,681 | ||||
| Net cash provided by (used for) operating activities | 21,301 | 11,785 | ||||
| Cash Flows From Investing Activities | ||||||
| Capital expenditures | (8,220 | ) | (5,589 | ) | ||
| Acquisition of business | (1,223 | ) | (691 | ) | ||
| Proceeds from sale of property, plant and equipment | 2,848 | — | ||||
| Proceeds from sale of notes receivable | — | 1,200 | ||||
| Net cash provided by (used for) investing activities | (6,595 | ) | (5,080 | ) | ||
| Cash Flows From Financing Activities | ||||||
| Net borrowings from revolving credit facility | 19,900 | — | ||||
| Repayments of long-term debt | (40,000 | ) | — | |||
| Payments on finance lease | (161 | ) | — | |||
| Cash dividends paid | (9,809 | ) | (9,736 | ) | ||
| Proceeds from issuance of common stock | 2,420 | 235 | ||||
| Shares withheld for employee taxes on equity awards | (748 | ) | (362 | ) | ||
| Deferred financing fees | (1,095 | ) | — | |||
| Net cash provided by (used for) financing activities | (29,493 | ) | (9,863 | ) | ||
| Foreign exchange rate effect on cash | 29 | (47 | ) | |||
| Net decrease in cash | (14,758 | ) | (3,205 | ) | ||
| Cash at January 1 | 28,301 | 75,527 | ||||
| Cash at June 30 | $ | 13,543 | $ | 72,322 |
MYERS INDUSTRIES, INC.
RECONCILIATION OF FREE CASH FLOW TO GAAP NET CASH PROVIDED BY
(USED FOR) OPERATING ACTIVITIES – CONTINUING OPERATIONS
(UNAUDITED)
(Dollars in thousands)
| YTD | YTD | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30, 2021 | June 30, 2020 | ||||||||||
| Net cash provided by (used for) operating activities | $ | 21,301 | $ | 11,785 | |||||||
| Capital expenditures | (8,220 | ) | (5,589 | ) | |||||||
| Free cash flow | $ | 13,081 | $ | 6,196 | |||||||
| YTD | YTD | Quarter | |||||||||
| June 30, 2021 | March 31, 2021 | June 30, 2021 | |||||||||
| Net cash provided by (used for) operating activities | $ | 21,301 | - | $ | 6,588 | = | $ | 14,713 | |||
| Capital expenditures | (8,220 | ) | - | (5,238 | ) | = | (2,982 | ) | |||
| Free cash flow | $ | 13,081 | - | $ | 1,350 | = | $ | 11,731 | |||
| YTD | YTD | Quarter | |||||||||
| June 30, 2020 | March 31, 2020 | June 30, 2020 | |||||||||
| Net cash provided by (used for) operating activities | $ | 11,785 | - | $ | 5,027 | = | $ | 6,758 | |||
| Capital expenditures | (5,589 | ) | - | (2,490 | ) | = | (3,099 | ) | |||
| Free cash flow | $ | 6,196 | - | $ | 2,537 | = | $ | 3,659 |
MYERS INDUSTRIES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
ADJUSTED DILUTED EARNINGS PER SHARE
(UNAUDITED)
| Full Year 2021 Guidance | ||||
|---|---|---|---|---|
| Low | High | |||
| GAAP diluted net income per common share | $ | 0.86 | $ | 1.01 |
| Add: Net restructuring expenses and other adjustments | 0.02 | 0.02 | ||
| Add: Acquisition and integration costs | 0.02 | 0.02 | ||
| Adjusted diluted earnings per share | $ | 0.90 | $ | 1.05 |
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