Carlisle Incorporated : Presentation PDF 1.67 MB

3rd Quarter 2021 Earnings Call

October 21, 2021

Forward Looking Statements & Non-GAAP Financial Measures

This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally use words such as "expect," "foresee," "anticipate," "believe," "project," "should," "estimate," "will," "plans," "forecast," and similar expressions, and reflect our expectations concerning the future. It is possible that our future performance may differ materially from current expectations expressed in these forward-looking statements, due to a variety of factors such as: increasing price and product/service competition by foreign and domestic competitors, including new entrants; technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; our mix of products/services; increases in raw material costs which cannot be recovered in product pricing; domestic and foreign governmental and public policy changes including environmental and industry regulations; threats associated with and efforts to combat terrorism; protection and validity of patent and other intellectual property rights; the successful integration and identification of our strategic acquisitions; the cyclical nature of our businesses; and the outcome of pending and future litigation and governmental proceedings. In addition, such statements could be affected by general industry and market conditions and growth rates, the condition of the financial and credit markets, and general domestic and international economic conditions including interest rate and currency exchange rate fluctuations. Further, any conflict in the international arena may adversely affect general market conditions and our future performance. We refer you to the documents we file from time to time with the Securities and Exchange Commission, such as our reports on Form 10-K, Form 10-Q and Form 8-K, for a discussion of these and other risks and uncertainties that could cause our actual results to differ materially from our current expectations and from the forward- looking statements contained in this press release. We undertake no obligation to update any forward-looking statement.

Our management uses non-GAAP financial measures in assessing and evaluating the Company's and its segments' performance, which exclude items we consider non-comparable items. We believe the use of such financial measures and information may be useful to investors. Non-GAAP financial measures should be read in conjunction with the GAAP financial measures, as non-GAAP measures are a supplement to, and not a replacement for, GAAP financial measures. Please refer to the appendix (slides 20 through 27) for a reconciliation of non-GAAP financial measures to the related GAAP financial measures. Throughout this presentation each non-GAAP measure is denoted with an *.

(1) Debt covenant ratios use a credit agreement adjusted EBITDA and net debt definitions which differs slightly from standard adjusted	2
EBITDA and net debt calculations.

3Q21 Highlights

• Growth accelerating across all of our businesses
• Proactive pricing in anticipation of higher raw material costs offset weather, supply chain and labor constraints
• Focused on expanding presence in Building Envelope and increasing content of energy-efficiency products in portfolio evidenced by purchase of Henry Company
• Issued $850M of senior notes at a weighted average coupon of 1.6%
• Raised dividend for 45th consecutive year and opportunistically repurchased shares

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Continued Progress on Commitment to ESG

• Leveraging COS to conduct energy audits at our manufacturing facilities, identify opportunities for energy and GHG reduction, and establish achievable energy reduction targets by 2022
• Enhanced our portfolio of energy-efficient products with the acquisition of Henry Company
• Expanded our campus recycling projects to 3 new facilities in 2021. Through 3Q21, recycled almost 1M lbs of production facer and cardboard and office wastepaper back into our Polyiso Insulation production stream
• In 2022, plan to upgrade our Dixon, CA Expanded Polystyrene (EPS) production facility to the enable use of 100% recycled materials

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3Q21 Results

Q3 revenue increased 25% y/y

• Organic revenue up 19.4% driven by strong demand across all CCM product lines and continued recovery at CIT and CFT
• 4.8% acquisition growth
• FX had a favorable 0.3% impact

Adjusted EPS increased 27% y/y driven by:

• Higher volumes, positive price, savings from COS, share repurchases and lower corporate expense
• Offsets included raw material and wage inflation

Financial Summary

(in millions, except per share amounts)	3Q21		3Q20
Revenues	$1,315.6	$1,057.0	+24.5%
Operating income	$166.5	$154.8	+7.6%
Operating margin	12.7%	14.6%		-190 bps
Adjusted EBITDA*	$250.3	$210.8	+18.7%
Adjusted EBITDA margin*	19.0%	19.9%		-90 bps
Diluted EPS	$2.12	$1.88	+12.8%
Adjusted diluted EPS*	$2.99	$2.35	+27.2%

Strategic pivot toward prioritizing investment in our highest-returning businesses, particularly Carlisle

Construction Materials, is paying dividends

*Refer to the appendix for a reconciliation of non-GAAP financial measures to the related GAAP financial measures.

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