Sales increased 21% on an organic basis, 43%
including Elkhart acquisition
Myers Industries, Inc. (NYSE: MYE), a manufacturer of polymer
products and distributor for the tire, wheel, and under-vehicle
service industry, today announced results for the first quarter
ended March 31, 2021.
First Quarter 2021 Financial
Highlights
- Net sales increased $52.2 million, or 42.7% to $174.4 million,
including $27.1 million, or 22.2% from the Elkhart Plastics
acquisition, compared with $122.3 million for the first quarter of
2020
- Net income per diluted share was $0.20, compared with $0.47 for
the first quarter of 2020, which included $0.24 from the sale of
notes and release of lease guarantee liability related to the
Company’s Lawn and Garden business sold in 2015
- Adjusted earnings per diluted share was $0.22 in both the first
quarter of 2021 and 2020
- Cash flow from operations was $6.6 million and free cash flow
was $1.4 million, compared with $5.0 million and $2.5 million,
respectively, for the first quarter of 2020
- Company announced two price increases during the first quarter
in response to higher raw material costs
President and CEO, Mike McGaugh said, “Our strong start to 2021,
combined with the successful implementation of two price increases,
and a seamless onboarding of Elkhart Plastics, fortifies my
optimism on our ability to create value for all of our
stakeholders. The healthy demand across our core end-markets points
to encouraging signs of a sustainable economic recovery. Strong
demand was reflected as well in our recently acquired Elkhart
Plastics business, which contributed $27 million to our top-line.
I’m pleased with our team’s ability to quickly integrate the
business, as well as with the progress we’re collectively realizing
to identify both cost and growth synergies.
“As a result of our growing confidence around the strength of
the economic recovery and our business momentum, we are raising our
sales guidance and expect to be at the higher end of our earnings
guidance for 2021. We are mitigating the impact of elevated raw
material costs and will be diligent in taking action to protect and
ultimately expand our margins, as evidenced by the two price
increases announced over the last few months.
“I joined Myers just over a year ago and I’m extremely proud of
the progress we’ve made in executing against our One Myers
strategy. We’ve added new expertise and experience to our senior
leadership team, optimized our corporate structure, and reinvested
in our equipment and labor force to make Myers more efficient and
more commercially focused. We also completed our first acquisition,
which so far has exceeded our expectations and set the blueprint
for future integrations. Our One Myers strategy has achieved early
success and I look forward to updating our investors on our
progress as we continue through 2021 and beyond. We’ve only just
begun.”
First Quarter 2021 Financial
Summary
Quarter Ended March 31,
2021
2020
% Inc
(Dec)
(Dollars in millions, except per
share data)
Net sales
$174.4
$122.3
42.7%
Operating income
$10.9
$23.3
(53.4)%
Adjusted operating income
$11.9
$11.7
1.5%
Net income
$7.3
$16.7
(56.3)%
Adjusted net income
$8.0
$7.7
3.8%
Net income per diluted share
$0.20
$0.47
(57.4)%
Adjusted earnings per diluted share
$0.22
$0.22
0.0%
Net sales for the first quarter of 2021 were $174.4 million, an
increase of $52.2 million, or 42.7%, compared with $122.3 million
for the first quarter of 2020, driven by increases in both the
Material Handling and Distribution Segments. Excluding the $27.1
million net sales impact from the Elkhart acquisition, organic net
sales increased 20% due to higher volume/mix and 1% due to
favorable pricing and foreign currency exchange.
Gross profit increased $7.9 million, or 18.7% to $50.4 million,
primarily due to the increased contribution from sales volume and
the Elkhart Plastics acquisition, which was partially offset by an
unfavorable price to cost relationship, an unfavorable sales mix,
and higher manufacturing costs during the quarter. Gross margin was
28.9% compared with 34.8% for the first quarter of 2020. Selling,
general and administrative expenses increased $8.4 million, or
27.1% to $39.5 million, reflecting the Elkhart Plastics
acquisition, higher incentive compensation costs, increased legal
fees, and higher selling expenses. SG&A as a percentage of
sales declined to 22.7% in the first quarter, compared with 25.5%
in the same period last year. Net income per diluted share was
$0.20, compared with $0.47 for the first quarter of 2020, which
included $0.24 from the sale of notes and release of lease
guarantee liability related to the Company’s Lawn and Garden
business sold in 2015. Adjusted earnings per diluted share were
$0.22, which was flat compared with the first quarter of 2020.
First 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
Q1 2021 Results
$129.9
$16.9
$16.9
13.0%
Increase (decrease) vs prior year
54.5%
11.6%
11.6%
-500 bps
Net sales for the first quarter of 2021 were $129.9 million, an
increase of $45.8 million, or 54.5%, compared with $84.1 million
for the first quarter of 2020. The increase was primarily due to
the incremental $27.1 million of sales from the Elkhart Plastics
acquisition completed in late 2020 and higher organic volume/mix.
Sales increased in the food and beverage, vehicle, consumer, and
industrial end markets. Operating income increased 11.6% to $16.9
million, compared with $15.2 million in 2020. Contributions from
the higher volume and Elkhart Plastics acquisition were partially
offset by an unfavorable price to cost relationship, an unfavorable
sales mix, higher manufacturing expenses, higher incentive
compensation costs, and increased legal fees. The Material Handling
Segment’s adjusted operating income margin was 13%, compared with
18% for the first quarter of 2020.
Distribution
Net Sales
Op Income
Adj Op Income
Adj Op Income Margin
Q1 2021 Results
$44.6
$1.4
$2.0
4.4%
Increase (decrease) vs prior year
16.6%
(22.3)%
5.2%
-50 bps
Net sales for the first quarter of 2021 were $44.6 million, an
increase of $6.4 million, or 16.6%, compared with $38.2 million for
the first quarter of 2020, driven by higher volume/mix. Volume was
up primarily due to increased sales of both supplies and equipment.
Operating income decreased to $1.4 million, compared with $1.9
million in 2020. Adjusted operating income increased to $2.0
million, compared with $1.9 million in 2020. The increase in
adjusted operating income was due primarily to the higher sales
volume, partially offset by an unfavorable sales mix, an
unfavorable price to cost relationship, and higher incentive
compensation costs. The Distribution Segment’s adjusted operating
income margin was 4.4%, compared with 4.9% for the first quarter of
2020.
2021 Outlook
The Company updated and raised its net sales outlook for fiscal
2021 and currently forecasts:
- Net sales growth in the high 30% range, including impact of the
Elkhart Plastics acquisition
- Diluted EPS in the range of $0.87 to $1.02; adjusted diluted
EPS in the range of $0.90 to $1.05
- Capital expenditures to approximate $15 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, May 6, 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: http://www.directeventreg.com/registration/event/5283649.
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 listen to the telephone replay,
callers should dial: (US) 800-585-8367 or (Int’l) 416-621-4642. The
Conference ID # is 5283649.
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.
MYERS INDUSTRIES, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in thousands, except
share and per share data)
Quarter Ended
March 31, 2021
March 31, 2020
Net sales
$
174,429
$
122,250
Cost of sales
124,016
79,767
Gross profit
50,413
42,483
Selling, general and administrative
expenses
39,548
31,116
Gain on disposal of fixed assets
—
(7
)
Gain on sale of notes receivable
—
(11,924
)
Operating income (loss)
10,865
23,298
Interest expense, net
995
1,069
Income (loss) before income
taxes
9,870
22,229
Income tax expense (benefit)
2,565
5,503
Net income (loss)
$
7,305
$
16,726
Net income (loss) per common
share:
Basic
$
0.20
$
0.47
Diluted
$
0.20
$
0.47
Weighted average common shares
outstanding:
Basic
35,993,331
35,723,979
Diluted
36,290,831
35,828,428
MYERS INDUSTRIES, INC.
SALES AND EARNINGS BY SEGMENT
(UNAUDITED)
(Dollars in thousands)
Quarter Ended March
31,
2021
2020
% Change
Net sales
Material Handling
$
129,893
$
84,076
54.5
%
Distribution
44,550
38,195
16.6
%
Inter-company Sales
(14
)
(21
)
-
Total
$
174,429
$
122,250
42.7
%
Operating income (loss)
Material Handling
$
16,927
$
15,167
11.6
%
Distribution
1,438
1,850
(22.3
)%
Corporate
(7,500
)
6,281
-
Total
$
10,865
$
23,298
(53.4
)%
Adjusted operating income
(loss)
Material Handling
$
16,927
$
15,167
11.6
%
Distribution
1,965
1,867
5.2
%
Corporate
(7,038
)
(5,359
)
-
Total
$
11,854
$
11,675
1.5
%
Adjusted operating income
margin
Material Handling
13.0
%
18.0
%
Distribution
4.4
%
4.9
%
Corporate
n/a
n/a
Total
6.8
%
9.6
%
Adjusted EBITDA
Material Handling
$
21,446
$
20,197
6.2
%
Distribution
2,508
2,463
1.8
%
Corporate
(6,939
)
(5,260
)
-
Total
$
17,015
$
17,400
(2.2
)%
Adjusted EBITDA margin
Material Handling
16.5
%
24.0
%
Distribution
5.6
%
6.4
%
Corporate
n/a
n/a
Total
9.8
%
14.2
%
MYERS INDUSTRIES, INC.
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES
GROSS PROFIT, OPERATING INCOME
AND EBITDA (UNAUDITED)
(Dollars in thousands)
Quarter Ended March 31,
2021
Material Handling
Distribution
Segment Total
Corporate & Other
Total
Net sales
$
129,893
$
44,550
$
174,443
$
(14
)
$
174,429
Gross profit
50,413
Gross margin
28.9
%
Operating income (loss)
16,927
1,438
18,365
(7,500
)
10,865
Add: Severance costs
—
527
527
318
845
Add: Elkhart acquisition and integration
costs
—
—
—
144
144
Adjusted operating income (loss)
16,927
1,965
18,892
(7,038
)
11,854
Adjusted operating income margin
13.0
%
4.4
%
10.8
%
n/a
6.8
%
Add: Depreciation and amortization
4,519
543
5,062
99
5,161
Adjusted EBITDA
$
21,446
$
2,508
$
23,954
$
(6,939
)
$
17,015
Adjusted EBITDA margin
16.5
%
5.6
%
13.7
%
n/a
9.8
%
Quarter Ended March 31,
2020
Material Handling
Distribution
Segment Total
Corporate & Other
Total
Net sales
$
84,076
$
38,195
$
122,271
$
(21
)
$
122,250
Gross profit
42,483
Gross margin
34.8
%
Operating income (loss)
15,167
1,850
17,017
6,281
23,298
Add: Restructuring expenses and other
adjustments
—
—
—
249
249
Add: Tuffy acquisition 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)
15,167
1,867
17,034
(5,359
)
11,675
Adjusted operating income margin
18.0
%
4.9
%
13.9
%
n/a
9.6
%
Add: Depreciation and amortization
5,030
596
5,626
99
5,725
Adjusted EBITDA
$
20,197
$
2,463
$
22,660
$
(5,260
)
$
17,400
Adjusted EBITDA margin
24.0
%
6.4
%
18.5
%
n/a
14.2
%
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 March
31,
2021
2020
Operating income (loss)
$
10,865
$
23,298
Add: Severance costs
845
—
Add: Restructuring expenses and other
adjustments
—
249
Add: Tuffy acquisition costs
—
52
Add: Elkhart acquisition and integration
costs
144
—
Less: Lawn and Garden sale of note/release
of lease guarantee liability
—
(11,924
)
Adjusted operating income (loss)
11,854
11,675
Less: Interest expense, net
(995
)
(1,069
)
Adjusted income (loss) before taxes
10,859
10,606
Less: Income tax expense(1)
(2,823
)
(2,864
)
Adjusted net income (loss)
$
8,036
$
7,742
Adjusted earnings per diluted share
$
0.22
$
0.22
(1) Income taxes are calculated using the
normalized effective tax rate for each year. The rate used in 2021
is 26% and in 2020 is 27%.
(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)
March 31, 2021
December 31, 2020
Assets
Current Assets
Cash
$
16,666
$
28,301
Accounts receivable, net
94,619
83,701
Income tax receivable
—
1,049
Inventories, net
69,848
65,919
Prepaid expenses and other current
assets
9,614
4,760
Total Current Assets
190,747
183,730
Property, plant, & equipment, net
83,220
73,953
Right of use asset - operating leases
20,820
18,390
Deferred income taxes
84
84
Other assets
125,410
123,858
Total Assets
$
420,281
$
400,015
Liabilities & Shareholders'
Equity
Current Liabilities
Accounts payable
$
69,933
$
61,150
Accrued expenses
39,001
36,744
Operating lease liability - short-term
4,269
4,359
Finance lease liability - short-term
487
—
Long-term debt - current portion
—
39,994
Total Current Liabilities
113,690
142,247
Long-term debt
70,928
37,582
Operating lease liability - long-term
16,300
13,755
Finance lease liability - long-term
9,812
—
Other liabilities
14,303
14,373
Deferred income taxes
995
2,958
Total Shareholders' Equity
194,253
189,100
Total Liabilities & Shareholders'
Equity
$
420,281
$
400,015
MYERS INDUSTRIES, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (UNAUDITED)
(Dollars in thousands)
Three Months Ended March
31,
2021
2020
Cash Flows From Operating
Activities
Net income
$
7,305
$
16,726
Adjustments to reconcile net income to net
cash provided by (used for) operating activities
Depreciation
3,966
3,553
Amortization
1,295
2,271
Non-cash stock-based compensation
expense
1,153
653
Gain on disposal of fixed assets
—
(7
)
Gain on sale of notes receivable
—
(11,924
)
Other
(1,288
)
241
Other long-term liabilities
8
(104
)
Cash flows provided by (used for) working
capital
Accounts receivable
(10,901
)
(3,524
)
Inventories
(3,861
)
(5,209
)
Prepaid expenses and other current
assets
(4,854
)
(218
)
Accounts payable and accrued expenses
13,765
2,569
Net cash provided by (used for) operating
activities
6,588
5,027
Cash Flows From Investing
Activities
Capital expenditures
(5,238
)
(2,490
)
Acquisition of business
(1,223
)
(691
)
Proceeds from sale of notes receivable
—
1,200
Net cash provided by (used for) investing
activities
(6,461
)
(1,981
)
Cash Flows From Financing
Activities
Net borrowings from revolving credit
facility
33,000
—
Repayments of long-term debt
(40,000
)
—
Payments on finance lease
(40
)
—
Cash dividends paid
(4,906
)
(4,899
)
Proceeds from issuance of common stock
1,900
125
Shares withheld for employee taxes on
equity awards
(663
)
(362
)
Deferred financing fees
(1,095
)
—
Net cash provided by (used for) financing
activities
(11,804
)
(5,136
)
Foreign exchange rate effect on cash
42
(223
)
Net decrease in cash
(11,635
)
(2,313
)
Cash at January 1
28,301
75,527
Cash at March 31
$
16,666
$
73,214
MYERS INDUSTRIES, INC.
RECONCILIATION OF FREE CASH
FLOW TO GAAP NET CASH PROVIDED BY
(USED FOR) OPERATING
ACTIVITIES – CONTINUING OPERATIONS
(UNAUDITED)
(Dollars in thousands)
QTD
QTD
March 31, 2021
March 31, 2020
Net cash provided by (used for) operating
activities
$
6,588
$
5,027
Capital expenditures
(5,238
)
(2,490
)
Free cash flow
$
1,350
$
2,537
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
$
0.87
$
1.02
Add: Restructuring expenses and other
adjustments
0.02
0.02
Add: Acquisition and integration costs
0.01
0.01
Adjusted diluted earnings per share
$
0.90
$
1.05
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210506005196/en/
Monica Vinay, Vice President, Investor Relations &
Treasurer, (330) 761-6212
Myers Industries (NYSE:MYE)
Historical Stock Chart
From Mar 2024 to Apr 2024
Myers Industries (NYSE:MYE)
Historical Stock Chart
From Apr 2023 to Apr 2024