8-K
Gibraltar Industries, Inc. (ROCK)
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) February 22, 2023 (February 22, 2023)
GIBRALTAR INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 000-22462 | 16-1445150 |
|---|---|---|
| (State or other jurisdiction of<br> incorporation ) | (Commission File Number) | (IRS Employer Identification No.) |
3556 Lake Shore Road
P.O. Box 2028
Buffalo, New York 14219-0228
(Address of principal executive offices) (Zip Code)
(716) 826-6500
(Registrant’s telephone number, including area code)
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 communications 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 communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications 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, $0.01 par value per share | ROCK | NASDAQ Stock Market |
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
The following information is furnished pursuant to Item 2.02:
On February 22, 2023, Gibraltar Industries, Inc. (the “Company”) issued a news release and will hold a conference call regarding financial results for the three and twelve months ended December 31, 2022. A copy of the news release (the “Release”) is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
The information in this Form 8-K under the caption Item 2.02, including the Release, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended (the “Securities Act”) or the Exchange Act, unless the Company specifically incorporates it by reference in a document filed under the Securities Act or the Exchange Act.
Item 9.01 Financial Statements and Exhibits
(a)-(c) Not Applicable
(d) Exhibits:
| Exhibit No. | Description |
|---|---|
| 99.1 | Earnings Release issued by Gibraltar Industries, Inc. on February 22, 2023 |
| 104 | Cover Page Interactive Data File (embedded with the Inline XBRL document) |
SIGNATURES
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.
| GIBRALTAR INDUSTRIES, INC. | |||
|---|---|---|---|
| Date: | February 22, 2023 | ||
| By: | /s/ Jeffrey J. Watorek | ||
| Jeffrey J. Watorek | |||
| Vice President and Treasurer |
3
Document
GIBRALTAR ANNOUNCES FOURTH QUARTER AND FULL YEAR 2022 FINANCIAL RESULTS
2022 Revenue: GAAP up 3.7%; Adjusted up 4.7%
2022 EPS: GAAP up 13.8% with Charge; Adjusted up 18.9%
2023 Outlook Calls for Further Margin Expansion and Cash Flow Growth
Buffalo, New York, February 22, 2023 - Gibraltar Industries, Inc. (Nasdaq: ROCK), a leading manufacturer and provider of products and services for the renewable energy, residential, agtech and infrastructure markets, today reported its financial results for the three- and twelve- month periods ended December 31, 2022.
“We executed well in the fourth quarter and remained focused on our key initiatives while adapting to the ongoing fluid external environment. Our adjusted net income improved 20.4% and adjusted EPS improved 28.6% on a sales reduction of 5.2%. We also generated free cash flow of 19% of revenue as we improved margin and working capital performance during the quarter. For the full year, we delivered revenue growth, adjusted EPS and free cash flow within our stated outlook, and GAAP EPS within our recently announced outlook,” stated Chairman and CEO Bill Bosway.
Fourth Quarter 2022 Consolidated Results from Continuing Operations
Below are fourth quarter 2022 consolidated results from continuing operations:
| Three Months Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| $Millions, except EPS | GAAP | Adjusted | ||||
| 2022 | 2021 | % Change | 2022 | 2021 | % Change | |
| Net Sales | $313.9 | $334.4 | -6.1% | $312.9 | $330.2 | -5.2% |
| Net Income | $3.3 | $9.8 | -66.3% | $22.4 | $18.6 | 20.4% |
| Diluted EPS | $0.11 | $0.30 | -63.3% | $0.72 | $0.56 | 28.6% |
Revenue decreased 6.1% to $313.9 million and adjusted revenue decreased 5.2% to $312.9 million. Adjusted revenue was down 9.8% organically, with reductions in the Residential, Renewables, and Agtech businesses. In Residential, volume was impacted as the market returned to historically lower seasonal demand patterns as supply chain reliability improved. Also, market prices began to align with changes in commodity indexes. The acquisition of Quality Aluminum Products (“QAP”) partially offset the impact of Residential market dynamics. Project rescoping and rescheduling impacted the Renewables and Agtech segments. Demand in the Infrastructure segment remained solid.
GAAP earnings decreased to $3.3 million, or $.0.11 per share, which included a previously disclosed one-time non-cash charge for the write-down of $14.0 million, or $0.35 per share, for the held-for-sale processing equipment business in the Agtech segment. Adjusted net income increased 20.4% to $22.4 million, or $0.72 per share, and adjusted EPS increased 28.6%. Performance was driven by profitability improvement in the Renewables and Infrastructure segments through material cost alignment, field operations efficiency, price management, business mix, 80/20 initiatives and the share repurchase program.
Adjusted measures exclude charges for restructuring initiatives, acquisition-related items and the results of the processing business which included a write down in the fourth quarter of 2022, as further described in the appended reconciliation of adjusted financial measures.
Fourth Quarter Segment Results
Renewables
For the fourth quarter, the Renewables segment reported:
| Three Months Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| $Millions | GAAP | Adjusted | ||||
| 2022 | 2021 | % Change | 2022 | 2021 | % Change | |
| Net Sales | $86.1 | $108.7 | (20.8)% | $86.1 | $108.7 | (20.8)% |
| Operating Income | $11.2 | $(1.0) | NMF | $13.1 | $1.4 | NMF |
| Operating Margin | 13.0% | (1.0)% | 1400 bps | 15.2% | 1.3% | 1390 bps |
Customer demand remained strong for products and services but both Segment revenue and backlog were down 20.8% and 17% respectively as the U.S. solar industry continued to contend with panel importation guidelines governed by the Uyghur Forced Labor Prevention Act (UFLPA), which has impacted scoping and scheduling of projects.
Despite importation issues impacting revenue, adjusted operating margin improved as expected, increasing 1,390 basis points year-over-year and 230 basis points sequentially, driven by field operations productivity, 80/20 project management, business mix, and materials productivity.
Residential
For the fourth quarter, the Residential segment reported:
| Three Months Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| $Millions | GAAP | Adjusted | ||||
| 2022 | 2021 | % Change | 2022 | 2021 | % Change | |
| Net Sales | $171.9 | $159.5 | 7.8% | $171.9 | $159.5 | 7.8% |
| Operating Income | $21.6 | $26.3 | (17.9)% | $23.0 | $26.5 | (13.2)% |
| Operating Margin | 12.5% | 16.5% | (400) bps | 13.4% | 16.6% | (320) bps |
Revenue increased 7.8%; the acquisition of QAP contributed 9.4% of growth for the segment. Organic revenue was impacted as the market returned to its typical lower seasonal demand patterns in the quarter as supply chain reliability improved and market prices began to align with changes in commodity indexes. QAP results, included for a full quarter, were as expected.
Adjusted operating income decreased 13.2% and adjusted operating margin decreased 320 basis points. The alignment of price and material cost, and the timing of changes in commodity indexes, impacted organic margin in the quarter. The acquisition of QAP, finalized in the third quarter, contributed 110 basis points of the decrease. Margins are expected to recover as price/cost alignment improves and QAP integration benefits are realized.
Agtech
For the fourth quarter, the Agtech segment reported:
| Three Months Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| $Millions | GAAP | Adjusted | ||||
| 2022 | 2021 | % Change | 2022 | 2021 | % Change | |
| Net Sales | $38.5 | $49.8 | (22.7)% | $37.6 | $45.5 | (17.4)% |
| Operating Income | $(2.4) | $(5.1) | 52.9% | $1.7 | $4.0 | (57.5)% |
| Operating Margin | (6.3)% | (10.2)% | 390 bps | 4.6% | 8.8% | (420) bps |
GAAP revenue decreased 22.7%, with adjusted revenue down 17.4% due to project rescoping and rescheduling of produce growing projects into 2023. While quote activity remains robust, backlog decreased 13%.
Adjusted operating margin decreased 420 basis points as project rescheduling delayed project revenue recognition, partially offset by better project execution.
As previously disclosed, Gibraltar recorded a fourth quarter 2022 charge to write down the value of its processing equipment business.
Infrastructure
For the fourth quarter, the Infrastructure segment reported:
| Three Months Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| $Millions | GAAP | Adjusted | ||||
| 2022 | 2021 | % Change | 2022 | 2021 | % Change | |
| Net Sales | $17.3 | $16.5 | 4.8% | $17.3 | $16.5 | 4.8% |
| Operating Income | $2.4 | $1.0 | 140.0% | $2.4 | $1.1 | 118.2% |
| Operating Margin | 13.7% | 6.4% | 730 bps | 13.7% | 6.5% | 720 bps |
Revenue increased 4.8% and backlog increased 23% as bidding activity remained very strong. Management expects continued positive impact in 2023 from increased infrastructure spending related to the Infrastructure Investment and Jobs Act.
Adjusted operating income more than doubled and adjusted operating margins improved 720 basis points driven by improved price material cost alignment, improved operating execution, product mix, and volume leverage.
Business Outlook
“We enter 2023 with good operating momentum and a plan to deliver full year growth, margin expansion, and strong cash performance for the year. We are well prepared for what will continue to be a fluid external environment and we expect that the Residential market will return to normal demand seasonality, panel supply for the solar industry will improve in the second half of the year, and Agtech projects for produce growing will get finalized.” Mr. Bosway concluded, “The long-term fundamentals of our end markets remain strong, and given the progress we made the last 12 months in our market positioning, systems, processes, and organization, we expect to drive solid performance in 2023 as we continue to execute toward our 2025 objectives.”
Gibraltar is providing guidance for revenue and earnings for the full year 2023. Consolidated revenue is expected to range between $1.36 billion and $1.41 billion, compared to $1.38 billion in 2022. GAAP EPS is expected to range between $3.04 and $3.24, compared to $2.56 in 2022, and adjusted EPS is expected to range between $3.46 and $3.66, compared to $3.40 in 2022.
Fourth Quarter 2022 Conference Call Details
Gibraltar will host a conference call today starting at 9:00 a.m. ET to review its results for the fourth quarter of 2022. Interested parties may access the webcast through the Investors section of the Company’s website at www.gibraltar1.com, where related presentation materials will also be posted prior to the conference call. The call also may be accessed by dialing (877) 407-3088 or (201) 389-0927. For interested individuals unable to join the live conference call, a webcast replay will be available on the Company’s website for one year.
About Gibraltar
Gibraltar is a leading manufacturer and provider of products and services for the renewable energy, residential, agtech, and infrastructure markets. Gibraltar’s mission, to make life better for people and the planet, is fueled by advancing the disciplines of engineering, science, and technology. Gibraltar is innovating to reshape critical markets in comfortable living, sustainable power, and productive growing throughout North America. For more please visit www.gibraltar1.com.
Forward-Looking Statements
Certain information set forth in this news release, other than historical statements, contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that are based, in whole or in part, on current expectations, estimates, forecasts, and projections about the Company’s business, and management’s beliefs about future operations, results, and financial position. These statements are not guarantees of future performance and are subject to a number of risk factors, uncertainties, and assumptions. Actual events, performance, or results could differ materially from the anticipated events, performance, or results expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from current expectations include, among other things, the availability and pricing of our principal raw materials and component parts, supply chain challenges causing project delays and field operations inefficiencies and disruptions, availability of labor at our manufacturing and distribution facilities or on our project sites, the loss of any key customers, adverse effects of inflation, our ability to sell assets that Gibraltar has determined to sell, other general economic conditions and conditions in the particular markets in which we operate, increases in spending due to laws and government incentives, such as the Infrastructure Investment and Jobs Act, changes in customer demand and capital spending, competitive factors and pricing pressures, our ability to develop and launch new products in a cost-effective manner, our ability to realize synergies from newly acquired businesses, disruptions to our IT systems, the impact of regulation (including the Department of Commerce’s solar panel anti-circumvention investigation and the Uyghur Forced Labor Prevention Act (UFLPA)), rebates, credits and incentives and variations in government spending and our ability to derive expected benefits from restructuring, productivity initiatives, liquidity enhancing actions, and other cost reduction actions. Before making any investment decisions regarding our company, we strongly advise you to read the section entitled “Risk Factors” in our most recent annual report on Form 10-K and Quarterly Report on Form 10-Q which can be accessed under the “SEC Filings” link of the “Investor Info” page of our website at www.Gibraltar1.com. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law or regulation.
Adjusted Financial Measures
To supplement Gibraltar’s consolidated financial statements presented on a GAAP basis, Gibraltar also presented certain adjusted financial measures in this news release and its quarterly conference call, including adjusted revenues, adjusted operating income and margin, adjusted net income, adjusted earnings per share (EPS), free cash flow and adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) each a non-GAAP financial measure. Adjusted revenue reflects the removal of revenue associated with our Processing business, which has been classified as held-for-sale. Adjusted net income, operating income and margin excludes special charges consisting of restructuring costs primarily associated with 80/20 simplification or lean initiatives, senior leadership transition costs, acquisition related costs and the operating losses generated by our processing business that has been classified as held-for-sale. These special charges are excluded since they may not be considered directly related to the Company’s ongoing business operations. The adjusted measures now exclude the results of the Processing business since it was classified as held for sale as of March 31, 2022. Our adjusted financial measures as of and for the three-month and twelve-month periods ending December 31, 2021 have been recast to reflect this additional adjustment as detailed in the appended reconciliation of adjusted financial measures. The results of the Processing business are considered non-recurring due to the Company’s commitment during the first quarter of 2022 to a plan to sell the Processing business. The aforementioned exclusions along with other adjustments to other income below operating profit are excluded from adjusted EPS. Adjusted EBITDA further excludes depreciation, amortization and stock compensation. In evaluating its business, the Company considers and uses these non-GAAP financial measures as supplemental measures of its operating performance. Free cash flow is operating cash flow less capital expenditures and the related margin is free cash flow divided by revenues. The Company believes that the presentation of results excluding these items provides meaningful supplemental data to investors that are indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods as well as comparison with other companies. Adjusted EBITDA and free cash flow are also useful measures of the Company’s ability to service debt and adjusted EBITDA is one of the measures used for determining the Company’s debt covenant compliance.
Adjustments to the most directly comparable financial measures presented on a GAAP basis are quantified in the reconciliation of adjusted financial measures excluding special charges provided in the supplemental financial schedules that accompany this news release. These adjusted measures should not be viewed as a substitute for the Company’s GAAP results and may be different than adjusted measures used by other companies and our presentation of non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.
Reconciliations of non-GAAP measures related to full-year 2023 guidance have not been provided due to the unreasonable efforts it would take to provide such reconciliations due to the high variability, complexity and uncertainty with respect to forecasting and quantifying certain amounts that are necessary for such reconciliations.
Contact:
LHA Investor Relations
Jody Burfening/Carolyn Capaccio
(212) 838-3777
rock@lhai.com
GIBRALTAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
| Three Months Ended<br>December 31, | Twelve Months Ended<br>December 31, | |||||||
|---|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | |||||
| Net sales | $ | 313,861 | $ | 334,449 | $ | 1,389,966 | $ | 1,339,783 |
| Cost of sales | 244,838 | 268,639 | 1,071,272 | 1,049,772 | ||||
| Gross profit | 69,023 | 65,810 | 318,694 | 290,011 | ||||
| Selling, general, and administrative expense | 47,651 | 42,724 | 188,592 | 184,723 | ||||
| Intangible asset impairment | — | 8,300 | — | 8,300 | ||||
| Income from operations | 21,372 | 14,786 | 130,102 | 96,988 | ||||
| Interest expense, net | 1,858 | 459 | 4,047 | 1,639 | ||||
| Other expense (income) | 13,768 | 66 | 14,565 | (4,213) | ||||
| Income before taxes | 5,746 | 14,261 | 111,490 | 99,562 | ||||
| Provision for income taxes | 2,398 | 4,468 | 29,084 | 25,046 | ||||
| Income from continuing operations | 3,348 | 9,793 | 82,406 | 74,516 | ||||
| Discontinued operations: | ||||||||
| (Loss) income before taxes | — | (388) | — | 1,479 | ||||
| Provision for income taxes | — | 43 | — | 366 | ||||
| (Loss) income from discontinued operations | — | (431) | — | 1,113 | ||||
| Net income | $ | 3,348 | $ | 9,362 | $ | 82,406 | $ | 75,629 |
| Net earnings per share – Basic: | ||||||||
| Income from continuing operations | $ | 0.11 | $ | 0.30 | $ | 2.57 | $ | 2.27 |
| (Loss) income from discontinued operations | — | (0.02) | — | 0.03 | ||||
| Net income | $ | 0.11 | $ | 0.28 | $ | 2.57 | $ | 2.30 |
| Weighted average shares outstanding – Basic | 31,135 | 32,910 | 32,096 | 32,873 | ||||
| Net earnings per share – Diluted: | ||||||||
| Income from continuing operations | $ | 0.11 | $ | 0.30 | $ | 2.56 | $ | 2.25 |
| (Loss) income from discontinued operations | — | (0.02) | — | 0.04 | ||||
| Net income | $ | 0.11 | $ | 0.28 | $ | 2.56 | $ | 2.29 |
| Weighted average shares outstanding – Diluted | 31,257 | 33,055 | 32,192 | 33,054 |
GIBRALTAR INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
| December 31,<br>2022 | December 31,<br>2021 | |||
|---|---|---|---|---|
| (unaudited) | ||||
| Assets | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 17,608 | $ | 12,849 |
| Accounts receivable, net of allowance of $3,746 and $3,738, respectively | 217,156 | 236,444 | ||
| Inventories, net | 170,360 | 176,207 | ||
| Prepaid expenses and other current assets | 18,813 | 21,467 | ||
| Total current assets | 423,937 | 446,967 | ||
| Property, plant, and equipment, net | 109,584 | 96,885 | ||
| Operating lease assets | 26,502 | 18,120 | ||
| Goodwill | 512,363 | 510,942 | ||
| Acquired intangibles | 137,526 | 141,504 | ||
| Other assets | 701 | 483 | ||
| $ | 1,210,613 | $ | 1,214,901 | |
| Liabilities and Stockholders’ Equity | ||||
| Current liabilities: | ||||
| Accounts payable | $ | 106,582 | $ | 172,286 |
| Accrued expenses | 73,721 | 67,993 | ||
| Billings in excess of cost | 35,017 | 46,711 | ||
| Total current liabilities | 215,320 | 286,990 | ||
| Long-term debt | 88,762 | 23,781 | ||
| Deferred income taxes | 47,088 | 40,278 | ||
| Non-current operating lease liabilities | 19,041 | 11,390 | ||
| Other non-current liabilities | 18,303 | 27,204 | ||
| Stockholders’ equity: | ||||
| Preferred stock, $0.01 par value; authorized 10,000 shares; none outstanding | — | — | ||
| Common stock, $0.01 par value; authorized 100,000 shares; 34,060 and 33,799 shares issued and outstanding in 2022 and 2021 | 340 | 338 | ||
| Additional paid-in capital | 322,873 | 314,541 | ||
| Retained earnings | 627,978 | 545,572 | ||
| Accumulated other comprehensive (loss) income | (3,432) | 187 | ||
| Cost of 3,199 and 1,107 common shares held in treasury in 2022 and 2021 | (125,660) | (35,380) | ||
| Total stockholders’ equity | 822,099 | 825,258 | ||
| $ | 1,210,613 | $ | 1,214,901 |
GIBRALTAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
| Twelve Months Ended<br>December 31, | ||||
|---|---|---|---|---|
| 2022 | 2021 | |||
| Cash Flows from Operating Activities | ||||
| Net income | $ | 82,406 | $ | 75,629 |
| Income from discontinued operations | — | 1,113 | ||
| Income from continuing operations | 82,406 | 74,516 | ||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||
| Depreciation and amortization | 26,167 | 31,966 | ||
| Intangible asset impairment | — | 8,300 | ||
| Stock compensation expense | 8,334 | 8,652 | ||
| Held for sale valuation allowance | 13,990 | — | ||
| Exit activity costs, non-cash | 2,276 | 1,193 | ||
| Provision for deferred income taxes | 6,337 | 2,968 | ||
| Other, net | 1,506 | 1,570 | ||
| Changes in operating assets and liabilities (excluding acquisition balances): | ||||
| Accounts receivable | 32,754 | (41,887) | ||
| Inventories | 14,377 | (85,763) | ||
| Other current assets and other assets | 2,062 | (426) | ||
| Accounts payable | (76,260) | 38,367 | ||
| Accrued expenses and other non-current liabilities | (11,258) | (14,384) | ||
| Net cash provided by operating activities of continuing operations | 102,691 | 25,072 | ||
| Net cash used in operating activities of discontinued operations | — | (2,002) | ||
| Net cash provided by operating activities | 102,691 | 23,070 | ||
| Cash Flows from Investing Activities | ||||
| Acquisitions, net of cash acquired | (51,621) | 4,143 | ||
| Purchases of property, plant, and equipment, net | (20,062) | (17,491) | ||
| Net proceeds from sale of business | — | 38,062 | ||
| Net cash (used in) provided by investing activities of continuing operations | (71,683) | 24,714 | ||
| Net cash used in investing activities of discontinued operations | — | (176) | ||
| Net cash (used in) provided by investing activities | (71,683) | 24,538 | ||
| Cash Flows from Financing Activities | ||||
| Proceeds from long-term debt | 204,500 | 59,500 | ||
| Long-term debt payments | (138,000) | (120,636) | ||
| Payment of debt issuance costs | (2,013) | — | ||
| Purchase of common stock at market prices | (89,494) | (6,497) | ||
| Net proceeds from issuance of common stock | — | 1,021 | ||
| Net cash used in financing activities | (25,007) | (66,612) | ||
| Effect of exchange rate changes on cash | (1,242) | (201) | ||
| Net increase (decrease) in cash and cash equivalents | 4,759 | (19,205) | ||
| Cash and cash equivalents at beginning of year | 12,849 | 32,054 | ||
| Cash and cash equivalents at end of year | $ | 17,608 | $ | 12,849 |
GIBRALTAR INDUSTRIES, INC.
Reconciliation of Adjusted Financial Measures
(in thousands, except per share data)
(unaudited)
| Three Months Ended<br>December 31, 2022 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| As<br>Reported<br>In GAAP Statements | Restructuring Charges | Acquisition Related Items | Portfolio Management | Adjusted<br>Financial Measures | |||||||||||
| Net Sales | |||||||||||||||
| Renewables | $ | 86,116 | $ | — | $ | — | $ | — | $ | 86,116 | |||||
| Residential | 171,926 | — | — | — | 171,926 | ||||||||||
| Agtech | 38,543 | — | — | (943) | 37,600 | ||||||||||
| Infrastructure | 17,276 | — | — | — | 17,276 | ||||||||||
| Consolidated sales | 313,861 | — | — | (943) | 312,918 | ||||||||||
| Income from operations | |||||||||||||||
| Renewables | 11,182 | 1,897 | 51 | — | 13,130 | ||||||||||
| Residential | 21,557 | 527 | 951 | — | 23,035 | ||||||||||
| Agtech | (2,436) | 1,517 | — | 2,654 | 1,735 | ||||||||||
| Infrastructure | 2,363 | — | — | — | 2,363 | ||||||||||
| Segment Income | 32,666 | 3,941 | 1,002 | 2,654 | 40,263 | ||||||||||
| Unallocated corporate expense | (11,294) | 2,306 | 72 | — | (8,916) | ||||||||||
| Consolidated income from operations | 21,372 | 6,247 | 1,074 | 2,654 | 31,347 | ||||||||||
| Interest expense | 1,858 | (140) | — | — | 1,718 | ||||||||||
| Other expense (income) | 13,768 | — | — | (13,990) | (222) | ||||||||||
| Income before income taxes | 5,746 | 6,387 | 1,074 | 16,644 | 29,851 | ||||||||||
| Provision for income taxes | 2,398 | 1,308 | 265 | 3,438 | 7,409 | ||||||||||
| Income from continuing operations | $ | 3,348 | $ | 5,079 | $ | 809 | $ | 13,206 | $ | 22,442 | |||||
| Income from continuing operations per share – diluted | $ | 0.11 | $ | 0.16 | $ | 0.03 | $ | 0.42 | $ | 0.72 | |||||
| Operating margin | |||||||||||||||
| Renewables | 13.0 | % | 2.2 | % | 0.1 | % | — | % | 15.2 | % | |||||
| Residential | 12.5 | % | 0.3 | % | 0.6 | % | — | % | 13.4 | % | |||||
| Agtech | (6.3) | % | 3.9 | % | — | % | 6.9 | % | 4.6 | % | |||||
| Infrastructure | 13.7 | % | — | % | — | % | — | % | 13.7 | % | |||||
| Segments Margin | 10.4 | % | 1.3 | % | 0.3 | % | 0.8 | % | 12.9 | % | |||||
| Consolidated | 6.8 | % | 2.0 | % | 0.3 | % | 0.8 | % | 10.0 | % |
GIBRALTAR INDUSTRIES, INC.
Reconciliation of Adjusted Financial Measures
(in thousands, except per share data)
(unaudited)
| Three Months Ended<br>December 31, 2021 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| As Reported In GAAP Statements | Restructuring & Intangible Asset Impairment Charges | Acquisition Related Items & Senior Leadership Transition Costs | Portfolio Management* | Adjusted Financial Measures * | |||||||||||
| Net Sales | |||||||||||||||
| Renewables | $ | 108,671 | $ | — | $ | — | $ | — | $ | 108,671 | |||||
| Residential | 159,534 | — | — | — | 159,534 | ||||||||||
| Agtech | 49,751 | — | — | (4,266) | 45,485 | ||||||||||
| Infrastructure | 16,493 | — | — | — | 16,493 | ||||||||||
| Consolidated sales | 334,449 | — | — | (4,266) | 330,183 | ||||||||||
| Income from operations | |||||||||||||||
| Renewables | (1,037) | 74 | 2,396 | — | 1,433 | ||||||||||
| Residential | 26,250 | 216 | — | — | 26,466 | ||||||||||
| Agtech | (5,064) | 8,203 | — | 850 | 3,989 | ||||||||||
| Infrastructure | 1,048 | 26 | — | — | 1,074 | ||||||||||
| Segments Income | 21,197 | 8,519 | 2,396 | 850 | 32,962 | ||||||||||
| Unallocated corporate expense | (6,411) | 49 | 3 | — | (6,359) | ||||||||||
| Consolidated income from operations | 14,786 | 8,568 | 2,399 | 850 | 26,603 | ||||||||||
| Interest expense | 459 | — | — | — | 459 | ||||||||||
| Other expense | 66 | — | — | — | 66 | ||||||||||
| Income before income taxes | 14,261 | 8,568 | 2,399 | 850 | 26,078 | ||||||||||
| Provision for income taxes | 4,468 | 2,153 | 594 | 226 | 7,441 | ||||||||||
| Income from continuing operations | $ | 9,793 | $ | 6,415 | $ | 1,805 | $ | 624 | $ | 18,637 | |||||
| Income from continuing operations per share - diluted | $ | 0.30 | $ | 0.20 | $ | 0.04 | $ | 0.02 | $ | 0.56 | |||||
| Operating margin | |||||||||||||||
| Renewables | (1.0) | % | 0.1 | % | 2.1 | % | — | % | 1.3 | % | |||||
| Residential | 16.5 | % | 0.1 | % | — | % | — | % | 16.6 | % | |||||
| Agtech | (10.2) | % | 16.5 | % | — | % | 1.7 | % | 8.8 | % | |||||
| Infrastructure | 6.4 | % | 0.2 | % | — | % | — | % | 6.5 | % | |||||
| Segments Margin | 6.3 | % | 2.6 | % | 0.8 | % | 0.3 | % | 10.0 | % | |||||
| Consolidated | 4.4 | % | 2.6 | % | 0.8 | % | 0.3 | % | 8.1 | % | |||||
| *Recast to exclude processing equipment business which was reclassified as held for sale as of March 31, 2022. |
GIBRALTAR INDUSTRIES, INC.
Reconciliation of Adjusted Financial Measures
(in thousands, except per share data)
(unaudited)
| Twelve Months Ended<br>December 31, 2022 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| As<br>Reported<br>In GAAP Statements | Restructuring Charges & Senior Leadership Transition Costs | Acquisition Related Items | Portfolio Management | Adjusted<br>Financial Measures | |||||||||||
| Net Sales | |||||||||||||||
| Renewables | $ | 377,567 | $ | — | $ | — | $ | — | $ | 377,567 | |||||
| Residential | 767,248 | — | — | — | 767,248 | ||||||||||
| Agtech | 168,868 | — | — | (7,840) | 161,028 | ||||||||||
| Infrastructure | 76,283 | — | — | — | 76,283 | ||||||||||
| Consolidated sales | 1,389,966 | — | — | (7,840) | 1,382,126 | ||||||||||
| Income from operations | |||||||||||||||
| Renewables | 25,243 | 4,240 | 782 | — | 30,265 | ||||||||||
| Residential | 126,458 | 2,121 | 1,427 | — | 130,006 | ||||||||||
| Agtech | 2,914 | 1,837 | — | 6,769 | 11,520 | ||||||||||
| Infrastructure | 9,003 | (63) | — | — | 8,940 | ||||||||||
| Segment Income | 163,618 | 8,135 | 2,209 | 6,769 | 180,731 | ||||||||||
| Unallocated corporate expense | (33,516) | 2,837 | 601 | — | (30,078) | ||||||||||
| Consolidated income from operations | 130,102 | 10,972 | 2,810 | 6,769 | 150,653 | ||||||||||
| Interest expense | 4,047 | (140) | — | — | 3,907 | ||||||||||
| Other expense | 14,565 | — | — | (13,890) | 675 | ||||||||||
| Income before income taxes | 111,490 | 11,112 | 2,810 | 20,659 | 146,071 | ||||||||||
| Provision for income taxes | 29,084 | 2,485 | 702 | 4,441 | 36,712 | ||||||||||
| Income from continuing operations | $ | 82,406 | $ | 8,627 | $ | 2,108 | $ | 16,218 | $ | 109,359 | |||||
| Income from continuing operations per share – diluted | $ | 2.56 | $ | 0.26 | $ | 0.07 | $ | 0.51 | $ | 3.40 | |||||
| Operating margin | |||||||||||||||
| Renewables | 6.7 | % | 1.1 | % | 0.2 | % | — | % | 8.0 | % | |||||
| Residential | 16.5 | % | 0.2 | % | 0.2 | % | — | % | 16.9 | % | |||||
| Agtech | 1.7 | % | 1.1 | % | — | % | 4.0 | % | 7.2 | % | |||||
| Infrastructure | 11.8 | % | (0.1) | % | — | % | — | % | 11.7 | % | |||||
| Segments Margin | 11.8 | % | 0.6 | % | 0.2 | % | 0.5 | % | 13.1 | % | |||||
| Consolidated | 9.4 | % | 0.8 | % | 0.2 | % | 0.5 | % | 10.9 | % |
GIBRALTAR INDUSTRIES, INC.
Reconciliation of Adjusted Financial Measures
(in thousands, except per share data)
(unaudited)
| Twelve Months Ended<br>December 31, 2021 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| As Reported In GAAP Statements | Restructuring & Intangible Asset Impairment Charges | Acquisition Related Items & Senior Leadership Transition Costs | Portfolio Management* | Adjusted Financial Measures * | |||||||||||
| Net Sales | |||||||||||||||
| Renewables | $ | 432,096 | $ | — | $ | — | $ | — | $ | 432,096 | |||||
| Residential | 635,505 | — | — | — | 635,505 | ||||||||||
| Agtech | 199,161 | — | — | (20,328) | 178,833 | ||||||||||
| Infrastructure | 73,021 | — | — | — | 73,021 | ||||||||||
| Consolidated sales | 1,339,783 | — | — | (20,328) | 1,319,455 | ||||||||||
| Income from operations | |||||||||||||||
| Renewables | 20,158 | 5,962 | 8,610 | — | 34,730 | ||||||||||
| Residential | 105,821 | 393 | — | — | 106,214 | ||||||||||
| Agtech | (931) | 9,987 | — | 3,539 | 12,595 | ||||||||||
| Infrastructure | 8,911 | 26 | — | — | 8,937 | ||||||||||
| Segments Income | 133,959 | 16,368 | 8,610 | 3,539 | 162,476 | ||||||||||
| Unallocated corporate expense | (36,971) | 145 | 2,282 | — | (34,544) | ||||||||||
| Consolidated income from operations | 96,988 | 16,513 | 10,892 | 3,539 | 127,932 | ||||||||||
| Interest expense | 1,639 | — | — | — | 1,639 | ||||||||||
| Other (income) expense | (4,213) | — | 4,747 | — | 534 | ||||||||||
| Income before income taxes | 99,562 | 16,513 | 6,145 | 3,539 | 125,759 | ||||||||||
| Provision for income taxes | 25,046 | 4,150 | 1,059 | 926 | 31,181 | ||||||||||
| Income from continuing operations | $ | 74,516 | $ | 12,363 | $ | 5,086 | $ | 2,613 | $ | 94,578 | |||||
| Income from continuing operations per share - diluted | $ | 2.25 | $ | 0.38 | $ | 0.15 | $ | 0.08 | $ | 2.86 | |||||
| Operating margin | |||||||||||||||
| Renewables | 4.7 | % | 1.4 | % | 2.0 | % | — | % | 8.0 | % | |||||
| Residential | 16.7 | % | 0.1 | % | — | % | — | % | 16.7 | % | |||||
| Agtech | (0.5) | % | 5.0 | % | — | % | 1.8 | % | 7.0 | % | |||||
| Infrastructure | 12.2 | % | — | % | — | % | — | % | 12.2 | % | |||||
| Segments Margin | 10.0 | % | 1.2 | % | 0.6 | % | 0.3 | % | 12.3 | % | |||||
| Consolidated | 7.2 | % | 1.2 | % | 0.7 | % | 0.3 | % | 9.7 | % | |||||
| *Recast to exclude processing equipment business which was reclassified as held for sale as of March 31, 2022. |
GIBRALTAR INDUSTRIES, INC.
Reconciliation of Income From Continuing Operations to Adjusted EBITDA and Free Cash Flows
(in thousands)
(unaudited)
| Three Months Ended<br>December 31, 2022 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Consolidated | Renewables | Residential | Agtech | Infrastructure | |||||||||||
| Net Sales | $ | 313,861 | $ | 86,116 | $ | 171,926 | $ | 38,543 | $ | 17,276 | |||||
| Less: Processing Revenues* | (943) | — | — | (943) | — | ||||||||||
| Adjusted Net Sales | $ | 312,918 | $ | 86,116 | $ | 171,926 | $ | 37,600 | $ | 17,276 | |||||
| Net Income | 3,348 | ||||||||||||||
| Provision for Income Taxes | 2,398 | ||||||||||||||
| Interest Expense | 1,858 | ||||||||||||||
| Other Expense | 13,768 | ||||||||||||||
| Operating Profit | 21,372 | 11,182 | 21,557 | (2,436) | 2,363 | ||||||||||
| Adjusted Measures** | 9,975 | 1,948 | 1,478 | 4,171 | — | ||||||||||
| Adjusted Operating Profit | 31,347 | 13,130 | 23,035 | 1,735 | 2,363 | ||||||||||
| Adjusted Operating Margin | 10.0 | % | 15.2 | % | 13.4 | % | 4.6 | % | 13.7 | % | |||||
| Adjusted Other Income | (193) | — | — | — | — | ||||||||||
| Depreciation & Amortization | 6,975 | 2,123 | 2,609 | 1,030 | 786 | ||||||||||
| Less: Held for Sale Depreciation & Amortization | — | — | — | — | — | ||||||||||
| Adjusted Depreciation & Amortization | 6,975 | 2,123 | 2,609 | 1,030 | 786 | ||||||||||
| Stock Compensation Expense | 2,445 | 195 | 245 | 108 | 41 | ||||||||||
| Less: SLT Related Stock Compensation Expense | (838) | — | — | — | — | ||||||||||
| Adjusted Stock Compensation Expense | 1,607 | 195 | 245 | 108 | 41 | ||||||||||
| Adjusted EBITDA | 40,122 | 15,448 | 25,889 | 2,873 | 3,190 | ||||||||||
| Adjusted EBITDA Margin | 12.8 | % | 17.9 | % | 15.1 | % | 7.6 | % | 18.5 | % | |||||
| Cash Flow - Operating Activities | 64,130 | ||||||||||||||
| Purchase of PPE, Net | (4,358) | ||||||||||||||
| Free Cash Flow | 59,772 | ||||||||||||||
| Free Cash Flow - % of Adjusted Net Sales | 19.1 | % | |||||||||||||
| *To remove revenues of processing equipment business classified as held for sale | |||||||||||||||
| **Adjusted Measures details are presented on the corresponding Reconciliation of Adjusted Financial Measures |
GIBRALTAR INDUSTRIES, INC.
Reconciliation of Income From Continuing Operations to Adjusted EBITDA and Free Cash Flows
(in thousands)
(unaudited)
| Three Months Ended<br>December 31, 2021 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Consolidated | Renewables | Residential | Agtech | Infrastructure | |||||||||||
| Net Sales | $ | 334,449 | $ | 108,671 | $ | 159,534 | $ | 49,751 | $ | 16,493 | |||||
| Less: Processing Revenues* | (4,266) | — | — | (4,266) | — | ||||||||||
| Adjusted Net Sales | $ | 330,183 | $ | 108,671 | $ | 159,534 | $ | 45,485 | $ | 16,493 | |||||
| Net Income | 9,793 | ||||||||||||||
| Provision for Income Taxes | 4,468 | ||||||||||||||
| Interest Expense | 459 | ||||||||||||||
| Other Expense | 66 | ||||||||||||||
| Operating Profit | 14,786 | (1,037) | 26,250 | (5,064) | 1,048 | ||||||||||
| Adjusted Measures** | 11,817 | 2,470 | 216 | 9,053 | 26 | ||||||||||
| Adjusted Operating Profit | 26,603 | 1,433 | 26,466 | 3,989 | 1,074 | ||||||||||
| Adjusted Operating Margin | 8.1 | % | 1.3 | % | 16.6 | % | 8.8 | % | 6.5 | % | |||||
| Adjusted Other Expense | 66 | — | — | — | — | ||||||||||
| Depreciation & Amortization | 8,008 | 3,749 | 2,126 | 1,295 | 782 | ||||||||||
| Less: Held for Sale Depreciation & Amortization | (332) | — | — | (332) | — | ||||||||||
| Less: Acquisition-Related Amortization | (1,567) | (1,567) | — | — | — | ||||||||||
| Adjusted Depreciation & Amortization | 6,109 | 2,182 | 2,126 | 963 | 782 | ||||||||||
| Stock Compensation Expense | 1,883 | 162 | 224 | 86 | 33 | ||||||||||
| Less: SLT Related Stock Compensation Expense | (128) | — | — | — | — | ||||||||||
| Adjusted Stock Compensation Expense | 1,755 | 162 | 224 | 86 | 33 | ||||||||||
| Adjusted EBITDA | 34,401 | 3,777 | 28,816 | 5,038 | 1,889 | ||||||||||
| Adjusted EBITDA Margin | 10.4 | % | 3.5 | % | 18.1 | % | 11.1 | % | 11.5 | % | |||||
| Cash Flow - Operating Activities | 39,595 | ||||||||||||||
| Purchase of PPE, Net | (4,240) | ||||||||||||||
| Free Cash Flow | 35,355 | ||||||||||||||
| Free Cash Flow - % of Adjusted Net Sales | 10.7 | % | |||||||||||||
| *To remove revenues of processing equipment business classified as held for sale | |||||||||||||||
| **Adjusted Measures details are presented on the corresponding Reconciliation of Adjusted Financial Measures |
GIBRALTAR INDUSTRIES, INC.
Reconciliation of Income From Continuing Operations to Adjusted EBITDA and Free Cash Flows
(in thousands)
(unaudited)
| Twelve Months Ended<br>December 31, 2022 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Consolidated | Renewables | Residential | Agtech | Infrastructure | |||||||||||
| Net Sales | $ | 1,389,966 | $ | 377,567 | $ | 767,248 | $ | 168,868 | $ | 76,283 | |||||
| Less: Processing Revenues* | (7,840) | — | — | (7,840) | — | ||||||||||
| Adjusted Net Sales | $ | 1,382,126 | $ | 377,567 | $ | 767,248 | $ | 161,028 | $ | 76,283 | |||||
| Net Income | 82,406 | ||||||||||||||
| Provision for Income Taxes | 29,084 | ||||||||||||||
| Interest Expense | 4,047 | ||||||||||||||
| Other Expense | 14,565 | ||||||||||||||
| Operating Profit | 130,102 | 25,243 | 126,458 | 2,914 | 9,003 | ||||||||||
| Adjusted Measures** | 20,551 | 5,022 | 3,548 | 8,606 | (63) | ||||||||||
| Adjusted Operating Profit | 150,653 | 30,265 | 130,006 | 11,520 | 8,940 | ||||||||||
| Adjusted Operating Margin | 10.9 | % | 8.0 | % | 16.9 | % | 7.2 | % | 11.7 | % | |||||
| Adjusted Other Expense | 695 | — | — | — | — | ||||||||||
| Depreciation & Amortization | 26,167 | 8,467 | 8,983 | 4,377 | 3,150 | ||||||||||
| Less: Held for Sale Depreciation & Amortization | (332) | — | — | (332) | — | ||||||||||
| Adjusted Depreciation & Amortization | 25,835 | 8,467 | 8,983 | 4,045 | 3,150 | ||||||||||
| Stock Compensation Expense | 8,334 | 939 | 990 | 427 | 170 | ||||||||||
| Less: SLT Related Stock Compensation Expense | (683) | — | — | — | — | ||||||||||
| Adjusted Stock Compensation Expense | 7,651 | 939 | 990 | 427 | 170 | ||||||||||
| Adjusted EBITDA | 183,444 | 39,671 | 139,979 | 15,992 | 12,260 | ||||||||||
| Adjusted EBITDA Margin | 13.3 | % | 10.5 | % | 18.2 | % | 9.9 | % | 16.1 | % | |||||
| Cash Flow - Operating Activities | 102,691 | ||||||||||||||
| Purchase of PPE, Net | (20,062) | ||||||||||||||
| Free Cash Flow | 82,629 | ||||||||||||||
| Free Cash Flow - % of Adjusted Net Sales | 6.0 | % | |||||||||||||
| *To remove revenues of processing equipment business classified as held for sale | |||||||||||||||
| **Adjusted Measures details are presented on the corresponding Reconciliation of Adjusted Financial Measures |
GIBRALTAR INDUSTRIES, INC.
Reconciliation of Income From Continuing Operations to Adjusted EBITDA and Free Cash Flows
(in thousands)
(unaudited)
| Twelve Months Ended<br>December 31, 2021 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Consolidated | Renewables | Residential | Agtech | Infrastructure | |||||||||||
| Net Sales | $ | 1,339,783 | $ | 432,096 | $ | 635,505 | $ | 199,161 | $ | 73,021 | |||||
| Less: Processing Revenues* | (20,328) | — | — | (20,328) | — | ||||||||||
| Adjusted Net Sales | $ | 1,319,455 | $ | 432,096 | $ | 635,505 | $ | 178,833 | $ | 73,021 | |||||
| Net Income | 74,516 | ||||||||||||||
| Provision for Income Taxes | 25,046 | ||||||||||||||
| Interest Expense | 1,639 | ||||||||||||||
| Other Income | (4,213) | ||||||||||||||
| Operating Profit | 96,988 | 20,158 | 105,821 | (931) | 8,911 | ||||||||||
| Adjusted Measures** | 30,944 | 14,572 | 393 | 13,526 | 26 | ||||||||||
| Adjusted Operating Profit | 127,932 | 34,730 | 106,214 | 12,595 | 8,937 | ||||||||||
| Adjusted Operating Margin | 9.7 | % | 8.0 | % | 16.7 | % | 7.0 | % | 12.2 | % | |||||
| Adjusted Other Expense | 534 | — | — | — | — | ||||||||||
| Depreciation & Amortization | 31,966 | 14,682 | 8,694 | 5,279 | 3,092 | ||||||||||
| Less: Held for Sale Depreciation & Amortization | (1,324) | — | — | (1,324) | — | ||||||||||
| Less: Acquisition-Related Amortization | (6,273) | (6,273) | — | — | — | ||||||||||
| Adjusted Depreciation & Amortization | 24,369 | 8,409 | 8,694 | 3,955 | 3,092 | ||||||||||
| Stock Compensation Expense | 8,652 | 772 | 990 | 635 | 104 | ||||||||||
| Less: SLT Related Stock Compensation Expense | (757) | — | — | (36) | — | ||||||||||
| Adjusted Stock Compensation Expense | 7,895 | 772 | 990 | 599 | 104 | ||||||||||
| Adjusted EBITDA | 159,662 | 43,911 | 115,898 | 17,149 | 12,133 | ||||||||||
| Adjusted EBITDA Margin | 12.1 | % | 10.2 | % | 18.2 | % | 9.6 | % | 16.6 | % | |||||
| Cash Flow - Operating Activities | 25,072 | ||||||||||||||
| Purchase of PPE, Net | (17,491) | ||||||||||||||
| Free Cash Flow | 7,581 | ||||||||||||||
| Free Cash Flow - % of Adjusted Net Sales | 0.6 | % | |||||||||||||
| *To remove revenues of processing equipment business classified as held for sale | |||||||||||||||
| **Adjusted Measures details are presented on the corresponding Reconciliation of Adjusted Financial Measures |