ALLEGION PLC The following Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from the results discussed in the forward-looking statements. Factors that may cause a difference include, but are not limited to, those discussed under Part I, Item 1A - Risk Factors in the Annual Report on Form 10-K for the fiscal year endedDecember 31, 2021 . The following section is qualified in its entirety by the more detailed information, including our Condensed and Consolidated Financial Statements and the notes thereto, which appears elsewhere in this Quarterly Report.
Overview
Organization
Allegion plc and its consolidated subsidiaries ("Allegion ," "the Company", "we," "our," or "us") is a leading global provider of security products and solutions operating in two segments:Allegion Americas andAllegion International . We sell a wide range of security products and solutions for end-users in commercial, institutional and residential facilities worldwide, including the education, healthcare, government, hospitality, commercial office and single and multi-family residential markets. Our leading brands include CISA®, Interflex®, LCN®, Schlage®, SimonsVoss® and Von Duprin®.
Recent Developments
Industry Trends and Outlook
Throughout the first half of 2022, we have experienced strong demand for our products and services in most of the markets we serve. Demand for our non-residential products, particularly in our Allegion Americas segment, continues to be robust; however, we are starting to see softening demand for our Allegion Americas residential products. Macroeconomic challenges, including the on-going war inUkraine and COVID-19 related lockdowns inChina , have also negatively impacted demand in the second quarter throughout many of the markets we serve through ourAllegion International businesses. Supply chain disruptions and delays and shortages in materials and labor availability persist, and continue to negatively impact our ability to meet the elevated levels of customer demand. These challenges also continue to create operational and logistical inefficiencies, including periodic production interruptions and elevated levels of inventory, which have negatively impacted our productivity, margin performance, working capital and cash flows throughout the first half of 2022. In the second quarter of 2022, however, we did see improvement in the supply of parts and components, particularly for ourAllegion Americas non-residential products, although we continue to experience shortages of electronic components from key suppliers. We expect these challenges to continue throughout the year. Persistent, elevated levels of inflation also continue to impact margin performance, although we continue to see strong momentum from the pricing initiatives we began in 2021 across all of our global businesses. We expect this pricing momentum to continue to contribute to revenue growth and offset the impact of inflation on margin performance throughout the remainder of 2022. While we anticipate fiscal year 2022 will continue to be a dynamic macroeconomic environment, we remain focused on providing exceptional service and innovation to our customers. We have implemented measures to mitigate operational and distribution inefficiencies, such as re-engineering product designs and configurations to accept alternate electronic components and developing alternate sources of supply; and investing in business initiatives to drive future growth and add value through seamless access. We will continue to explore various options to control costs and enhance financial performance while minimizing disruption to customers and our overall business. The on-going COVID-19 pandemic, the Russian invasion ofUkraine and the macroeconomic challenges noted above will likely continue to affect us in numerous and evolving ways. The full impact of these challenges and uncertainties on our business will continue to depend on future developments that we may not be able to accurately predict. These challenges and uncertainties, and their potential or heightened impact on our business, results of operations, financial condition and cash flows, as well as other challenges and uncertainties that could affect our businesses are described further under Part I, Item 1A. "Risk Factors" contained in our Annual Report on Form 10-K for the year endedDecember 31, 2021 .
Acquisition of the Access Technologies business
OnJuly 5, 2022 , we completed the previously announced acquisition of the Access Technologies business. The closing purchase price for the acquisition was$923.1 million , inclusive of the previously announced purchase price of$900 million , in addition to customary working capital adjustments and the settlement of certain operating liabilities at closing. To finance this acquisition, we used the net proceeds from the issuance of our 5.411% Senior Notes, together with borrowings under our 2021 Revolving Facility.
The Access Technologies business is a leading manufacturer, installer and
service provider of automatic doors in
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healthcare, education, commercial offices, hospitality and government. This acquisition helps us create a more comprehensive portfolio of access solutions, with the addition of automated entrances. Additionally, the Access Technologies business adds an expansive service and support network throughout theU.S. andCanada , broadening our solutions to national, regional and local customers, and complementing our existing strengths in these non-residential markets. The Access Technologies business will be integrated into our Allegion Americas segment.
2022 Dividends and Share Repurchases
During the six months ended
Results of Operations - Three months ended
% of % of
In millions, except per share amounts 2022 revenues 2021 revenues
Net revenues $ 773.1 $ 746.9
Cost of goods sold 458.1 59.3 % 426.4 57.1 %
Selling and administrative expenses 167.9 21.7 % 175.1 23.4 %
Operating income 147.1 19.0 % 145.4 19.5 %
Interest expense 17.2 12.4
Other income, net (3.4) (3.2)
Earnings before income taxes 133.3 136.2
Provision for income taxes 18.1 17.4
Net earnings 115.2 118.8
Less: Net earnings attributable to noncontrolling
interests 0.1 0.1
Net earnings attributable to Allegion plc $ 115.1 $ 118.7 Diluted net earnings per ordinary share attributable
to
$ 1.30 $ 1.31
The discussions that follow describe the significant factors contributing to the changes in our results of operations for the periods presented and form the basis used by management to evaluate the financial performance of the business.
Net Revenues
Net revenues for the three months ended
Pricing 8.4 % Volume (2.0) % Acquisitions 0.1 % Currency exchange rates (3.0) % Total 3.5 % The increase in Net revenues was primarily driven by improved pricing across all our major businesses, partially offset by unfavorable foreign currency exchange rate movements and lower volumes, particularly in our Allegion Americas residential andAllegion International businesses. Pricing includes increases or decreases of price, including discounts, surcharges and/or other sales deductions, on our existing products and services. As discussed above, in response to the persistent, elevated levels of inflation discussed above, we continue to implement various pricing initiatives across our global businesses, which drove the overall increase in Net revenues compared to the same period in 2021. Volume includes increases or decreases of revenue due to changes in unit volume of existing products and services, as well as new products and services.
Operating Income/Margin
Operating income for the three months endedJune 30, 2022 , increased$1.7 million compared to the same period in 2021. Operating margin, which we define as Operating income as a percentage of total Net revenues, for the three months endedJune 30, 2022 , decreased to 19.0% from 19.5% for the same period in 2021, due to the following: 18
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In millions Operating Income Operating Margin June 30, 2021 $ 145.4 19.5 % Pricing and productivity in excess of inflation 20.3 1.0 % Volume / product mix (1.9) 0.1 % Restructuring / acquisition expenses (7.0) (0.9) % Currency exchange rates (4.9) (0.1) % Investment spending (5.5) (0.7) % Acquisitions 0.7 0.1 % June 30, 2022 $ 147.1 19.0 % The increase in Operating income was driven by pricing improvements in excess of inflation and productivity challenges, as well as the impact of a prior year acquisition. These increases were partially offset by unfavorable volume/product mix, a year-over-year increase in restructuring and acquisition expenses, unfavorable foreign currency exchange rate movements and increased investment spending. The decrease in Operating margin was primarily due to a year-over-year increase in restructuring and acquisition expenses, unfavorable foreign currency exchange rate movements and increased investment spending. These decreases were partially offset by pricing improvements in excess of inflation and productivity challenges, the favorable impact of product mix on operating margin, which exceeded the impact from lower volumes, as well as the impact of a prior year acquisition. Pricing and productivity in excess of inflation includes the impact to both Operating income and Operating margin from pricing, as defined above, in addition to productivity and inflation. Productivity represents improvements in unit costs of materials, cost reductions related to improvements to our manufacturing design and processes and reductions in selling and administrative expenses due to productivity projects. Inflation includes both unit costs for the current period compared to the average actual cost for the prior period, multiplied by current year volumes, and current period costs of ongoing selling and administrative functions compared to the same ongoing expenses in the prior period. Expenses related to increased head count for strategic initiatives, new facilities or other significant spending for strategic initiatives or new product and channel development, are captured in Investment spending in the table above. Volume/product mix represents the impact to both Operating income and Operating margin due to increases or decreases of revenue due to changes in unit volume, including new products and services, including the effect of changes in the mix of products and services sold on Cost of goods sold.
Interest Expense
Interest expense for the three months endedJune 30, 2022 , increased$4.8 million compared with the same period in 2021, primarily due to$4.3 million of third party costs related to the financing of the Access Technologies business acquisition. The recent rise in interest rates has also contributed to a higher weighted-average interest rate on our outstanding indebtedness.
Other Income, Net
The components of Other income, net for the three months endedJune 30, 2022 and 2021, were as follows: In millions 2022 2021 Interest income$ (0.1) $ (0.1) Foreign currency exchange loss 0.9 0.8 Earnings from equity method investments, net (0.5) (0.4) Net periodic pension and postretirement benefit income, less service cost (2.4) (2.0) Other (1.3) (1.5) Other income, net$ (3.4) $ (3.2) Provision for Income Taxes The effective income tax rates for the three months endedJune 30, 2022 and 2021, were 13.6% and 12.8%, respectively. The increase in the effective tax rate compared to 2021 is primarily due to the prior year impact of the remeasurement of deferred tax balances resulting from the enactment of a jurisdictional tax rate change and unfavorable year-over-year changes in the amount of share-based compensation deductions, which were partially offset by the favorable mix of income earned in higher tax rate jurisdictions. 19
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Results of Operations - Six months ended
% of % of
In millions, except per share amounts 2022 revenues 2021 revenues
Net revenues $ 1,496.7 $ 1,441.2
Cost of goods sold 893.0 59.7 % 823.3 57.1 %
Selling and administrative expenses 339.6 22.7 % 341.2 23.7 %
Operating income 264.1 17.6 % 276.7 19.2 %
Interest expense 29.1 24.7
Other income, net (5.6) (6.7)
Earnings before income taxes 240.6 258.7
Provision for income taxes 32.3 31.7
Net earnings 208.3 227.0
Less: Net earnings attributable to
noncontrolling interests 0.2 0.3
Net earnings attributable to Allegion plc $ 208.1 $ 226.7
Diluted net earnings per ordinary share
attributable to Allegion plc ordinary
shareholders: $ 2.35 $ 2.49 The discussions that follow describe the significant factors contributing to the changes in our results of operations for the periods presented and form the basis used by management to evaluate the financial performance of the business.
Net revenues
Net revenues for the six months ended
Pricing 7.2 % Volume (0.8) % Currency exchange rates (2.5) % Total 3.9 % The increase in Net revenues was primarily driven by improved pricing across all our major businesses, partially offset by unfavorable foreign currency exchange rate movements and lower volumes, particularly in our Allegion Americas residential business.
Operating Income/Margin
Operating income for the six months endedJune 30, 2022 , decreased$12.6 million compared to the same period in 2021, and Operating margin for the six months endedJune 30, 2022 , decreased to 17.6% from 19.2% for the same period in 2021, due to the following: In millions Operating Income Operating Margin June 30, 2021 $ 276.7 19.2 % Pricing and productivity in excess of inflation 13.3 (0.4) % Volume / product mix (0.2) 0.2 % Restructuring / acquisition expenses (9.8) (0.7) % Currency exchange rates (8.0) (0.1) % Investment spending (9.4) (0.7) % Acquisitions / divestitures 1.5 0.1 % June 30, 2022 $ 264.1 17.6 % The decrease in Operating income was primarily due to unfavorable volume/product mix, a year-over-year increase in restructuring and acquisition expenses, unfavorable foreign currency exchange rate movements and increased investment spending. These decreases were partially offset by improved pricing in excess of inflation and productivity challenges and the impacts of a prior year acquisition and the prior year divestiture of our QMI business. The decrease in Operating margin was primarily due to the detrimental impacts to margin from inflation and productivity challenges exceeding the positive impact from improved pricing, in addition to a year-over-year increase in restructuring and 20
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acquisition expenses, unfavorable foreign currency exchange rate movements and increased investment spending. These decreases were partially offset by the favorable impact of product mix on operating margin, which exceeded the impact from lower volumes and the impacts of a prior year acquisition and the prior year divestiture of our QMI business.
Interest Expense
Interest expense for the six months endedJune 30, 2022 , increased$4.4 million compared with the same period in 2021, primarily due to the$4.3 million of third party costs related to the financing of the Access Technologies business acquisition. Other Income, Net The components of Other income, net for the six months endedJune 30, 2022 and 2021, were as follows: In millions 2022 2021 Interest income$ (0.2) $ (0.1) Foreign currency exchange loss 1.9 1.2 (Earnings) loss from equity investments (0.6) 0.3 Net periodic pension and postretirement benefit income, less service cost (5.0) (3.9) Other (1.7) (4.2) Other income, net$ (5.6) $ (6.7) Provision for Income Taxes The effective income tax rates for the six months endedJune 30, 2022 and 2021, were 13.4% and 12.3%, respectively. The increase in the effective tax rate compared to 2021 is primarily due to the prior year impact of the remeasurement of deferred tax balances resulting from the enactment of a jurisdictional tax rate change and unfavorable year-over-year changes in the amount of share-based compensation deductions, which were partially offset by the favorable mix of income earned in higher tax rate jurisdictions.
Review of Business Segments
We operate in and report financial results for two segments:
Segment operating income is the measure of profit and loss that our chief operating decision maker uses to evaluate the financial performance of the business and as the basis for resource allocation, performance reviews and compensation. For these reasons, we believe that Segment operating income represents the most relevant measure of Segment profit and loss. Our chief operating decision maker may exclude certain charges or gains, such as corporate charges and other special charges, to arrive at a Segment operating income that is a more meaningful measure of profit and loss upon which to base our operating decisions. We define Segment operating margin as Segment operating income as a percentage of the segment's Net revenues.
The segment discussions that follow describe the significant factors contributing to the changes in results for each segment included in Net earnings.
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Segment Results of Operations - For the three and six months ended
Three months ended Six months ended
In millions 2022 2021 % Change 2022 2021 % Change
Net revenues
Allegion Americas $ 592.3 $ 549.4 7.8 % $ 1,120.5 $ 1,048.3 6.9 %
Allegion International 180.8 197.5 (8.5) % 376.2 392.9 (4.3) %
Total $ 773.1 $ 746.9 $ 1,496.7 $ 1,441.2
Segment operating income
Allegion Americas $ 153.6 $ 150.4 2.1 % $ 277.5 $ 285.8 (2.9) %
Allegion International 11.4 18.1 (37.0) % 31.0 33.5 (7.5) %
Total $ 165.0 $ 168.5 $ 308.5 $ 319.3
Segment operating margin
Allegion Americas 25.9 % 27.4 % 24.8 % 27.3 %
Allegion International 6.3 % 9.2 % 8.2 % 8.5 %
Allegion Americas
Our Allegion Americas segment is a leading provider of security products and
solutions throughout North America , Central America , the Caribbean and South
America . The segment sells a broad range of products and solutions including
locks, locksets, portable locks, key systems, door closers, exit devices, doors,
door systems, electronic products and access control systems to customers in
commercial, institutional and residential facilities, including the education,
healthcare, government, hospitality, commercial office and single and
multi-family residential markets. This segment's primary brands are LCN,
Schlage, Steelcraft , Technical Glass Products ("TGP") and Von Duprin .
Net Revenues
Net revenues for the three months ended
Pricing 9.4 % Volume (1.4) % Currency exchange rates (0.2) % Total 7.8 % The increase in Net revenues was driven by substantially improved pricing, partially offset by lower volumes in our residential business and unfavorable foreign currency exchange rate movements. As discussed above, theAllegion Americas segment has implemented various pricing initiatives to help offset increased inflationary pressures, driving the overall increase in Net revenues compared to the same period in 2021. Net revenues from non-residential products for the three months endedJune 30, 2022 , increased by a high teens percent compared to the same period in the prior year, driven by improved pricing and higher volumes. Improved availability of materials and components helped drive the increase in volumes compared to the same period in the prior year. Net revenues from residential products for the three months endedJune 30, 2022 , decreased by a mid-teens percent compared to the same period in the prior year. This decrease was primarily driven by lower volumes and was partially offset by improved pricing. Although we continue to face challenges around the supply of electronic components and have also seen a slight softening in market demand for residential products in the current quarter, we expect to revert to revenue growth in the second half of 2022, given the combination of our pricing initiatives and the comparable impact to the second half of 2021, when the supply chain challenges and shortages of materials began to negatively impact revenue growth. Growth in electronic security products and solutions is a metric that is actively monitored by management and a focus of our investors. Electronic products encompass both residential and non-residential products and include all electrified product categories including, but not limited to, electronic locks, access controls and electrified exit devices and door controls. For the three months endedJune 30, 2022 , Net revenues from the sale of electronic products in the Allegion Americas segment decreased by a low single digits percent compared to the same period in the prior year. We continue to face supply chain challenges around shortages of electronic components from key suppliers, which is impacting our ability to meet the level of demand for our electronic products. We expect these challenges around the availability of electronic components to continue throughout the year, and as a result, we are actively implementing measures to mitigate the operational and distribution 22
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inefficiencies these component shortages and other challenges are creating, such as re-engineering product designs and configurations to accept alternate electronic components and developing alternate sources of supply.
Net revenues for the six months ended
Pricing 8.1 % Volume (1.1) % Currency exchange rates (0.1) % Total 6.9 % The increase in Net revenues was driven by improved pricing and was partially offset by lower volumes in our residential business and unfavorable foreign currency exchange rate movements. Net revenues from non-residential products for the six months endedJune 30, 2022 , increased by a mid-teens percent compared to the same period in the prior year, driven by improved pricing and higher volumes. Net revenues from residential products for the six months endedJune 30, 2022 , decreased by a low double digits percent compared to the same period in the prior year, driven by lower volumes, which were partially offset by increased pricing. Net revenues from the sale of electronic products for the six months endedJune 30, 2022 , were flat compared to the same period in the prior year. Operating income/margin Segment operating income for the three months endedJune 30, 2022 , increased$3.2 million compared to the same period in 2021, and Segment operating margin for the three months endedJune 30, 2022 , decreased to 25.9% from 27.4%, due to the following: In millions Operating Income Operating Margin June 30, 2021 $ 150.4 27.4 % Pricing and productivity in excess of inflation 5.8 (1.5) % Volume / product mix 2.1 0.8 % Currency exchange rates (0.8) (0.1) % Investment spending (3.9) (0.7) % June 30, 2022 $ 153.6 25.9 %
The increase in Segment operating income was primarily driven by pricing improvements in excess of inflation and productivity challenges, as well as favorable product mix, which exceeded the impact from lower volumes. These increases were partially offset by unfavorable foreign currency exchange rate movements and increased investment spending.
The decrease in Segment operating margin was primarily due to the detrimental impacts to margin from inflation and productivity challenges exceeding the impact from improved pricing, as well as increased investment spending and unfavorable foreign currency exchange rate movements. These decreases were partially offset by the positive impact to margin from product mix, which exceeded the impact from lower volumes.
Segment operating income for the six months endedJune 30, 2022 , decreased$8.3 million compared to the same period in 2021, and Segment operating margin for the six months endedJune 30, 2022 , decreased to 24.8% from 27.3%, due to the following: In millions Operating Income Operating Margin June 30, 2021 $ 285.8 27.3 % Inflation in excess of pricing and productivity (1.6) (2.2) % Volume / product mix 0.6 0.4 % Currency exchange rates (0.7) (0.1) % Investment spending (6.8) (0.6) % Restructuring / acquisition expenses 0.2 - % June 30, 2022 $ 277.5 24.8 % The decrease in Segment operating income was primarily driven by inflation and productivity challenges in excess of pricing improvements, unfavorable foreign currency exchange rate movements and increased investment spending. These decreases were partially offset by favorable product mix, which exceeded the impact from lower volumes, and a year-over-year decrease in restructuring and acquisition expenses. 23
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The decrease in Segment operating margin was primarily driven by inflation and productivity challenges in excess of pricing improvements, as well as increased investment spending and unfavorable foreign currency exchange rate movements. These decreases were partially offset by the positive impact to margin from product mix, which exceeded the impact from lower volumes.
OurAllegion International segment provides security products, services and solutions primarily throughoutEurope ,Asia andOceania . The segment offers end-users a broad range of products, services and solutions including locks, locksets, portable locks, key systems, door closers, exit devices, doors and door systems, electronic products and access control systems, as well as time and attendance and workforce productivity solutions. This segment's primary brands are AXA,Bricard , Briton, CISA, Gainsborough, Interflex andSimonsVoss .
Net Revenues
Net revenues for the three months endedJune 30, 2022 , decreased by 8.5%, or$16.7 million , compared to the same period in 2021, due to the following: Pricing 5.5 % Volume (3.6) % Acquisitions 0.5 % Currency exchange rates (10.9) % Total (8.5) % The decrease in Net revenues was driven primarily by unfavorable foreign currency exchange rate movements due to the significant strengthening of theU.S. dollar relative to most of the currencies in which we do business throughout ourAllegion International segment. Lower volumes, inclusive of our discontinuing to sell intoRussia and COVID-19 related lockdowns inChina , also contributed to the decrease in Net revenues. These decreases were partially offset by improved pricing and the impact of a prior year acquisition.
Net revenues for the six months ended
4.9 %
Volume (0.2) %
Acquisitions / divestitures (0.2) %
Currency exchange rates (8.8) %
Total (4.3) %
The decrease in Net revenues was primarily driven by unfavorable foreign currency exchange rate movements, slightly lower volumes and the prior year divestiture of our QMI business. These decreases were partially offset by improved pricing.
Operating income/margin
Segment operating income for the three months endedJune 30, 2022 , decreased$6.7 million compared to the same period in 2021, and Segment operating margin for the three months endedJune 30, 2022 , decreased to 6.3% from 9.2%, due to the following: In millions Operating Income Operating Margin June 30, 2021 $ 18.1 9.2 % Pricing and productivity in excess of inflation 5.7 2.3 % Volume / product mix (4.0) (1.8) % Currency exchange rates (4.1) (1.2) % Investment spending (1.6) (0.8) % Acquisitions 0.7 0.3 % Restructuring / acquisition expenses (3.4) (1.7) % June 30, 2022 $ 11.4 6.3 %
The decreases in Segment operating income and Segment operating margin were primarily driven by unfavorable volume/product mix, unfavorable foreign currency exchange rate movements, a year-over-year increase in restructuring and acquisition
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expenses and increased investment spending. These decreases were partially offset by pricing and productivity improvements in excess of inflation and the impact of a prior year acquisition.
Segment operating income for the six months endedJune 30, 2022 , decreased$2.5 million compared to the same period in 2021, and Segment operating margin for the six months endedJune 30, 2022 , decreased to 8.2% from 8.5%, due to the following: In millions Operating Income Operating Margin June 30, 2021 $ 33.5 8.5 % Pricing and productivity in excess of inflation 8.3 1.6 % Volume / product mix (0.8) (0.2) % Currency exchange rates (7.3) (1.1) % Investment spending (2.6) (0.6) % Acquisitions / divestitures 1.5 0.4 % Restructuring expenses (1.6) (0.4) % June 30, 2022 $ 31.0 8.2 % The decreases in Segment operating income and Segment operating margin were primarily driven by unfavorable volume/product mix, unfavorable foreign currency exchange rate movements, a year-over-year increase in restructuring and acquisition expenses and increased investment spending. These decreases were partially offset by pricing and productivity improvements in excess of inflation, as well as the impacts of a prior year acquisition and the prior year divestiture of our QMI business.
Liquidity and Capital Resources
Liquidity Outlook, Sources and Uses
Our primary source of liquidity is cash provided by operating activities. Cash provided by operating activities is used to invest in new product development and fund capital expenditures and working capital requirements. Our ability to generate cash from our operating activities, our unused availability under our 2021 Revolving Facility and our access to the capital and credit markets enable us to fund these capital needs, execute our long-term growth strategies and return value to our shareholders. Further, our business operates with strong operating cash flows, low leverage and low capital intensity, providing financial flexibility, including sufficient access to credit markets. As discussed above, onJuly 5, 2022 , we completed our acquisition of the Access Technologies business. We used the net proceeds from the issuance of our 5.411% Senior Notes, together with borrowings of$340.0 million under the 2021 Revolving Facility, which was drawn onJuly 1, 2022 , to finance the acquisition. While the financing of this acquisition has increased our leverage, we remain comfortably within all our financial covenants. Further, we do not believe this acquisition or the related financing will diminish our sound financial position or our ability to meet our short-term financing needs for at least the next 12 months. Short-term financing needs primarily consist of working capital requirements, restructuring initiatives, capital spending, dividend payments and principal and interest payments on our long-term debt. Long-term financing needs depend largely on potential growth opportunities, including potential acquisitions, repayment or refinancing of our long-term obligations and repurchases of our ordinary shares. Based upon our operations, existing cash balances and availability under our 2021 Revolving Facility, we expect cash flows from operations to be sufficient to maintain a sound financial position and liquidity and to meet our financing needs for at least the next 12 months. Further, we do not anticipate any covenant compliance challenges with any of our outstanding indebtedness for at least the next 12 months. We also believe the availability under our 2021 Credit Facilities and access to credit and capital markets are sufficient to achieve our longer-term strategic plans.
The following table reflects the major categories of cash flows for the six
months ended
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