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Atkore Inc. Announces Fourth Quarter 2023 Results

Fourth-Quarter Highlights

  • Net income per diluted share decreased to $3.63 from $5.18 in prior year period; Adjusted net income per diluted share decreased to $4.21 from $5.52 in prior year period
  • Net income decreased by $79.9 million versus prior year period to $140.9 million; Adjusted EBITDA decreased by $93.1 million versus prior year period to $232.0 million

Fiscal 2023 Highlights

  • Net income per diluted share decreased to $17.27 from $20.30 in prior year; Adjusted net income per diluted share decreased to $19.40 from $21.55 in prior year
  • Net income decreased by $223.5 million versus prior year to $689.9 million; Adjusted EBITDA decreased to $1,042.1 million from $1,341.8 million in prior year
  • Net cash provided by operating activities of $807.6 million; Free Cash Flow of $588.7 million

Additional Highlights

  • The Board of Directors approves a new quarterly dividend program to be added to the capital deployment model; the Company expects the first quarterly cash distribution to be considered, declared and paid in calendar Q1 2024, following Atkore’s fiscal Q1 2024 earnings announcement.
  • Full-year 2024 Net sales expected to be in the range of $3.50 - $3.65 billion
  • Full-year 2024 Adjusted EBITDA outlook of $900 - $950 million; Full-year Adjusted net income per diluted share outlook of $16.00 - $17.00
  • Maintaining Full-Year Adjusted net income per diluted share goal of greater than $18.00 in fiscal year 2025

Atkore Inc. (the “Company” or “Atkore”) (NYSE: ATKR) announced earnings for its fiscal 2023 full year and fourth quarter ended September 30, 2023 (“fourth quarter”).

“Atkore achieved solid results for fiscal 2023, as we continued to successfully execute on our strategic initiatives and deliver differentiated value to our customers,” said Bill Waltz, Atkore President and Chief Executive Officer. “As our performance and financial results continue to normalize after our significant levels of outperformance and record results in fiscal 2022, we are encouraged by the resilience of our business model, and the differentiated value that our product portfolio provides to our customers. We believe that we have transformed, diversified and elevated the profitability of this business since our initial public offering.”

Waltz continued, “In addition, I am proud of our disciplined approach to capital allocation. We have made great progress investing in the future of our Company while continuing to return cash to shareholders by executing over $990 million in share repurchases since the program was authorized in November 2021. The Board’s addition of a new quarterly dividend program is an exciting next step for Atkore and our shareholders.”

2023 Fourth Quarter Results

 

 

 

Three Months Ended

(in thousands)

 

September 30, 2023

 

September 30, 2022

 

Change

 

Change %

Net sales

 

 

 

 

 

 

 

 

Electrical

 

$

649,787

 

 

$

795,220

 

 

$

(145,433

)

 

(18.3

)%

Safety & Infrastructure

 

 

220,239

 

 

 

233,884

 

 

 

(13,645

)

 

(5.8

)%

Eliminations

 

 

(137

)

 

 

(118

)

 

 

(19

)

 

16.1

%

Consolidated operations

 

$

869,889

 

 

$

1,028,986

 

 

$

(159,097

)

 

(15.5

)%

 

 

 

 

 

 

 

 

 

Net income

 

$

140,925

 

 

$

220,802

 

 

$

(79,877

)

 

(36.2

)%

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

 

 

 

 

 

 

 

Electrical

 

$

237,577

 

 

$

308,783

 

 

$

(71,206

)

 

(23.1

)%

Safety & Infrastructure

 

 

15,139

 

 

 

36,371

 

 

 

(21,232

)

 

(58.4

)%

Unallocated

 

 

(20,738

)

 

 

(20,067

)

 

 

(671

)

 

3.3

%

Consolidated operations

 

$

231,978

 

 

$

325,085

 

 

$

(93,107

)

 

(28.6

)%

Net sales for the fourth quarter of 2023 decreased to $869.9 million, a decrease of 15.5% compared to $1,029.0 million for the prior-year period. The decrease was primarily due to lower average selling prices of $173.8 million as the result of expected pricing normalization and the economic value of solar tax credits to be transferred to certain customers of $14.5 million. These decreases were partially offset by higher sales volume of $19.2 million from entities acquired during fiscal 2022 and 2023 of $10.4 million.

Gross profit decreased by $113.0 million to $301.5 million for the fourth quarter of 2023, as compared to $414.5 million for the prior-year period. Gross margins decreased from 40.3% in the prior year period to 34.7%. Gross profit and gross profit margin decreased due to declines in average selling prices of $173.8 million, partially offset by slower declines in the costs of steel, copper and resin of $90.9 million.

Net income decreased $79.9 million to $140.9 million for the fourth quarter of 2023, as compared to $220.8 million for the prior-year period, due to lower operating income of $107.4 million, partially offset by decreased income taxes of $27.0 million. Adjusted net income decreased $70.5 million to $161.0 million compared to $231.6 million for the prior-year period.

Adjusted EBITDA decreased $93.1 million, or 28.6%, to $232.0 million for the fourth quarter of 2023, as compared to $325.1 million for the prior-year period. Net income margin decreased from 21.5% in the prior-year period to 16.2% and Adjusted EBITDA Margin decreased 490 basis points from 31.6% to 26.7%.

Net income per diluted share was $3.63 for the fourth quarter of 2023, a decrease of $1.55 from the prior-year period. Adjusted net income per diluted share was $4.21 per share for the fourth quarter of 2023 compared to $5.52 for the prior-year period.

Segment Results

Electrical

Electrical net sales decreased $145.4 million, or 18.3%, to $649.8 million for the fourth quarter of 2023, as compared to $795.2 million for the prior-year period. The decrease in net sales is primarily attributed to decreased average selling prices of $133.4 million as a result of expected pricing normalization and decreased volume of $23.1 million, partially offset by increased sales from companies acquired in fiscal 2022 and 2023 of $9.8 million.

Adjusted EBITDA decreased $71.2 million, or 23.1%, to $237.6 million for the fourth quarter of 2023, as compared to $308.8 million for the prior-year period, and Adjusted EBITDA Margin decreased from 38.8% to 36.6%. The decrease in Adjusted EBITDA was largely due to lower average selling prices over input costs.

Safety & Infrastructure

Safety & Infrastructure net sales decreased $13.6 million, or 5.8%, to $220.2 million for the fourth quarter of 2023, as compared to $233.9 million for the prior-year period. The decrease is attributed to lower average selling prices of $40.4 million and the economic value of solar tax credits to be transferred to certain customers of $14.5 million partially offset by higher volumes of $42.4 million.

Adjusted EBITDA decreased $21.2 million, or 58.4%, to $15.1 million for the fourth quarter of 2023, as compared to $36.4 million for the prior-year period. Adjusted EBITDA Margin decreased to 6.9% from 15.6%. The Adjusted EBITDA decrease was largely due to lower average selling prices over input costs and the impacts of solar tax credit accounting.

Fiscal 2023 Full-Year Results

Net sales for fiscal 2023 decreased $395.2 million to $3,518.8 million, a decrease of 10.1%, compared to $3,913.9 million for fiscal 2022. The decrease in net sales is primarily attributed to decreased average selling prices of $646.6 million, the economic value of solar tax credits to be transferred to certain customers of $30.4 million and the unfavorable impact of foreign exchange rates of $15.1 million. These decreases are partially offset by increased net sales of $168.9 million from companies acquired during fiscal 2022 and 2023 and increased sales volume of $125.1 million across varying product categories within both the Electrical and the Safety & Infrastructure segments.

Gross profit for fiscal 2023 decreased $300.5 million to $1,339.5 million, a decrease of 18.3%, compared to $1,640.0 million for fiscal 2022. Gross margin decreased to 38.1% in fiscal 2023 compared to 41.9% in fiscal 2022 due to declines in average selling prices of $646.6 million, partially offset by slower declines in the input costs of steel, copper and PVC resin of $337.8 million.

Net income decreased $223.5 million to $689.9 million for fiscal 2023, as compared to $913.4 million for fiscal 2022. Adjusted net income decreased $191.1 million to $763.0 million for fiscal 2023 compared to $954.1 million for fiscal 2022. The decrease in both net income and adjusted net income was primarily driven by lower operating income of $340.3 million.

Adjusted EBITDA decreased $299.7 million or 22.3%, to $1,042.1 million for fiscal 2023, as compared to $1,341.8 million for fiscal 2022. The decrease was primarily due to lower operating income.

Net income per diluted share on a GAAP basis was $17.27 for fiscal 2023, a decrease of $3.03 from fiscal 2022. Adjusted net income per diluted share was $19.40 for fiscal 2023 compared to $21.55 for fiscal 2022.

Liquidity & Capital Resources

During fiscal 2023, operating activities provided $807.6 million of cash, compared to $786.8 million during fiscal year 2022. Free cash flow decreased to $588.7 million for fiscal 2023 from $651.1 million in fiscal year 2022. The increase in cash provided by operating activities was primarily driven by less cash used in working capital of $105.8 million and tax impacts of $229.3 million, partially offset by lower operating income of $340.3 million. The decrease in free cash flow was primarily due to additional capital expenditures during fiscal 2023 of $83.1 million when compared to the prior fiscal year, partially offset by the increase in operating cash.

During fiscal 2023, the Company deployed $83.4 million on the acquisition of Elite Polymer Solutions with an additional $14.0 million to be paid in the future, repurchased $491.0 million in outstanding shares and had capital expenditures of $218.9 million.

The Board of Directors has approved a new quarterly dividend program to be added to the Company’s capital deployment model. The Company expects the first quarterly cash distribution to be considered, declared and paid in calendar Q1 2024, following Atkore’s fiscal Q1 2024 earnings announcement. All dividend declarations are subject to approval by the Board of Directors. Compliance with any applicable financial hurdles and the details of future dividend declarations, including the amount, timing and establishment of the record and payment dates, will be determined by the Board of Directors.

Outlook and Targets1

Fiscal 2024 First Quarter - The Company expects the first quarter of fiscal 2024 Adjusted EBITDA to be in the range of $200 - $210 million and Adjusted net income per diluted share to be in the range of $3.50 - $3.70.

Fiscal 2024 Full Year - The Company expects fiscal year 2024 Adjusted EBITDA to be in the range of $900-$950 million and Adjusted net income per diluted share to be in the range of $16.00 - $17.00.

Fiscal 2025 Full Year Goal - The Company is maintaining its fiscal 2025 Adjusted net income per diluted share target of greater than $18.00.

The Company notes that the outlook and target information provided may vary due to changes in assumptions or market conditions and other factors described under “Forward-Looking Statements.”

Conference Call Information

Atkore management will host a conference call today, November 17, 2023, at 8 a.m. Eastern time, to discuss the Company’s financial results, provide a business update and long-term financial targets. The conference call may be accessed by dialing (888) 330-2446 (domestic) or (240) 789-2732 (international). The call will be available for replay until December 1, 2023. The replay can be accessed by dialing (800) 770-2030, or for international callers, (647) 362-9199. The passcode for the live call and the replay is 5592214.

Interested investors and other parties can also listen to a webcast of the live conference call by logging onto the Investor Relations section of the Company's website at http://investors.atkore.com. The online replay will be available on the same website immediately following the call.

To learn more about the Company please visit the company's website at http://investors.atkore.com.

_________________________

1 Reconciliations of the forward-looking full-year and fiscal first quarter outlook and target for Adjusted EBITDA and Adjusted net income per diluted share are not being provided as the Company does not currently have sufficient data to accurately estimate the variables and individual adjustments for such reconciliations. Accordingly, we are relying on the exception provided by Item 10(e)(1)(i)(B) of Regulation S-K to exclude these reconciliations.

About Atkore Inc.

Atkore is a leading manufacturer of electrical products for commercial, industrial, data center, telecommunications, and solar applications. With 5,600 employees and $3.5B in sales in fiscal year 2023, we deliver sustainable solutions to meet the growing demands of electrification and digital transformation. To learn more, please visit www.atkore.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements relating to financial outlook. Some of the forward-looking statements can be identified by the use of forward-looking terms such as “believes,” “expects,” “may,” “will,” “shall,” “should,” “would,” “could,” “seeks,” “aims,” “projects,” “is optimistic,” “intends,” “plans,” “estimates,” “anticipates” or other comparable terms. Forward-looking statements include, without limitation, all matters that are not historical facts. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that forward-looking statements are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation, our actual results of operations, financial condition and liquidity, and the development of the market in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this press release. In addition, even if our results of operations, financial condition and cash flows, and the development of the market in which we operate, are consistent with the forward-looking statements contained in this press release, those results or developments may not be indicative of results or developments in subsequent periods.

A number of important factors, including, without limitation, the risks and uncertainties discussed or referenced under the caption “Risk Factors” in our Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission (“SEC”) on November 17, 2023 could cause actual results and outcomes to differ materially from those reflected in the forward-looking statements. Additional factors that could cause actual results and outcomes to differ from those reflected in forward-looking statements include, without limitation: declines in, and uncertainty regarding, the general business and economic conditions in the United States and international markets in which we operate; weakness or another downturn in the United States non-residential construction industry; widespread outbreak of diseases, such as the novel coronavirus (COVID-19) pandemic; changes in prices of raw materials; pricing pressure, reduced profitability, or loss of market share due to intense competition; availability and cost of third-party freight carriers and energy; high levels of imports of products similar to those manufactured by us; changes in federal, state, local and international governmental regulations and trade policies; adverse weather conditions; increased costs relating to future capital and operating expenditures to maintain compliance with environmental, health and safety laws; reduced spending by, deterioration in the financial condition of, or other adverse developments, including inability or unwillingness to pay our invoices on time, with respect to one or more of our top customers; increases in our working capital needs, which are substantial and fluctuate based on economic activity and the market prices for our main raw materials, including as a result of failure to collect, or delays in the collection of, cash from the sale of manufactured products; work stoppage or other interruptions of production at our facilities as a result of disputes under existing collective bargaining agreements with labor unions or in connection with negotiations of new collective bargaining agreements, as a result of supplier financial distress, or for other reasons; changes in our financial obligations relating to pension plans that we maintain in the United States; reduced production or distribution capacity due to interruptions in the operations of our facilities or those of our key suppliers; loss of a substantial number of our third-party agents or distributors or a dramatic deviation from the amount of sales they generate; security threats, attacks, or other disruptions to our information systems, or failure to comply with complex network security, data privacy and other legal obligations or the failure to protect sensitive information; possible impairment of goodwill or other long-lived assets as a result of future triggering events, such as declines in our cash flow projections or customer demand and changes in our business and valuation assumptions; safety and labor risks associated with the manufacture and in the testing of our products; product liability, construction defect and warranty claims and litigation relating to our various products, as well as government inquiries and investigations, and consumer, employment, tort and other legal proceedings; our ability to protect our intellectual property and other material proprietary rights; risks inherent in doing business internationally; changes in foreign laws and legal systems, including as a result of Brexit; our inability to introduce new products effectively or implement our innovation strategies; our inability to continue importing raw materials, component parts and/or finished goods; the incurrence of liabilities and the issuance of additional debt or equity in connection with acquisitions, joint ventures or divestitures and the failure of indemnification provisions in our acquisition agreements to fully protect us from unexpected liabilities; failure to manage acquisitions successfully, including identifying, evaluating, and valuing acquisition targets and integrating acquired companies, businesses or assets; the incurrence of additional expenses, increase in complexity of our supply chain and potential damage to our reputation with customers resulting from regulations related to "conflict minerals"; disruptions or impediments to the receipt of sufficient raw materials resulting from various anti-terrorism security measures; restrictions contained in our debt agreements; failure to generate cash sufficient to pay the principal of, interest on, or other amounts due on our debt; failure to generate the significant amount of cash needed to pay dividends; challenges attracting and retaining key personnel or high-quality employees; future changes to tax legislation; failure to generate sufficient cash flow from operations or to raise sufficient funds in the capital markets to satisfy existing obligations and support the development of our business; and other factors described from time to time in documents that we file with the SEC. The Company assumes no obligation to update the information contained herein, which speaks only as of the date hereof.

Non-GAAP Financial Information

This press release includes certain financial information, not prepared in accordance with Generally Accepted Accounting Principles in the United States (“GAAP”). Because not all companies calculate non-GAAP financial information identically (or at all), the presentations herein may not be comparable to other similarly titled measures used by other companies. Further, these measures should not be considered substitutes for the performance measures derived in accordance with GAAP. See non-GAAP reconciliations below in this press release for a reconciliation of these measures to the most directly comparable GAAP financial measures.

Adjusted EBITDA and Adjusted EBITDA Margin

We use Adjusted EBITDA and Adjusted EBITDA Margin in evaluating the performance of our business and in the preparation of our annual operating budgets as indicators of business performance and profitability. We believe Adjusted EBITDA and Adjusted EBITDA Margin allow us to readily view operating trends, perform analytical comparisons and identify strategies to improve operating performance.

We define Adjusted EBITDA as net income (loss) before income taxes, adjusted to exclude unallocated expenses, depreciation and amortization, interest expense, net, stock-based compensation, loss on extinguishment of debt, certain legal matters, and other items, such as inventory reserves and adjustments, loss on disposal of property, plant and equipment, insurance recovery related to damages of property, plant and equipment, release of indemnified uncertain tax positions, realized or unrealized gain (loss) on foreign currency impacts of intercompany loans and related forward currency derivatives, gain on purchase of business, loss on assets held for sale, restructuring costs and transaction costs. We define Adjusted EBITDA Margin as Adjusted EBITDA as a percentage of Net sales.

We believe Adjusted EBITDA and Adjusted EBITDA Margin, when presented in conjunction with comparable GAAP measures, are useful for investors because management uses Adjusted EBITDA and Adjusted EBITDA Margin in evaluating the performance of our business.

Adjusted Net Income and Adjusted Net Income per Share

We use Adjusted net income and Adjusted net income per share in evaluating the performance of our business and profitability. Management believes that these measures provide useful information to investors by offering additional ways of viewing the Company’s results that, when reconciled to the corresponding GAAP measure provide an indication of performance and profitability excluding the impact of unusual and or non-cash items. We define Adjusted net income as net income before stock-based compensation, loss on extinguishment of debt, loss on assets held for sale, intangible asset amortization, gain on purchase of a business, certain legal matters and other items, and the income tax expense or benefit on the foregoing adjustments that are subject to income tax. We define Adjusted net income per share as basic and diluted net income per share excluding the per share impact of gain (loss) on extinguishment of debt, stock-based compensation, intangible asset amortization, gain on sale of a business, certain legal matters and other items, and the income tax expense or benefit on the foregoing adjustments that are subject to income tax.

Free Cash Flow

We define Free Cash Flow as net cash provided by operating activities less capital expenditures. We believe that Free Cash Flow provides meaningful information regarding the Company’s liquidity.

ATKORE INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

Three Months Ended

 

Fiscal Year Ended

(in thousands, except per share data)

September 30, 2023

 

September 30, 2022

 

September 30, 2023

 

September 30, 2022

Net sales

$

869,889

 

 

$

1,028,986

 

 

$

3,518,761

 

 

$

3,913,949

 

Cost of sales

 

568,424

 

 

 

614,508

 

 

 

2,179,260

 

 

 

2,273,924

 

Gross profit

 

301,465

 

 

 

414,478

 

 

 

1,339,501

 

 

 

1,640,025

 

Gross Margin

 

34.7

%

 

 

40.3

%

 

 

38.1

%

 

 

41.9

%

Selling, general and administrative

 

97,008

 

 

 

107,023

 

 

 

388,206

 

 

 

370,044

 

Intangible asset amortization

 

15,027

 

 

 

10,622

 

 

 

57,804

 

 

 

36,176

 

Operating income

 

189,430

 

 

 

296,833

 

 

 

893,491

 

 

 

1,233,805

 

Interest expense, net

 

8,588

 

 

 

9,000

 

 

 

35,232

 

 

 

30,676

 

Other expense (income), net

 

380

 

 

 

474

 

 

 

7,969

 

 

 

(490

)

Income before income taxes

 

180,462

 

 

 

287,359

 

 

 

850,290

 

 

 

1,203,620

 

Income tax expense

 

39,537

 

 

 

66,557

 

 

 

160,391

 

 

 

290,186

 

Net income

$

140,925

 

 

$

220,802

 

 

$

689,899

 

 

$

913,434

 

 

 

 

 

 

 

 

 

Net income per share

 

 

 

 

 

 

 

Basic

$

3.68

 

 

$

5.24

 

 

$

17.51

 

 

$

20.56

 

Diluted

$

3.63

 

 

$

5.18

 

 

$

17.27

 

 

$

20.30

 

ATKORE INC.

CONSOLIDATED BALANCE SHEETS

 

(in thousands, except share and per share data)

 

September 30, 2023

 

September 30, 2022

Assets

 

 

 

 

Current Assets:

 

 

 

 

Cash and cash equivalents

 

$

388,114

 

 

$

388,751

 

Accounts receivable, less allowance for current and expected credit losses of $5,179 and $2,544, respectively

 

 

559,854

 

 

 

528,904

 

Inventories, net

 

 

493,852

 

 

 

454,511

 

Prepaid expenses and other current assets

 

 

96,670

 

 

 

80,654

 

Total current assets

 

 

1,538,490

 

 

 

1,452,820

 

Property, plant and equipment, net

 

 

559,041

 

 

 

390,220

 

Intangible assets, net

 

 

394,372

 

 

 

382,706

 

Goodwill

 

 

311,106

 

 

 

289,330

 

Right-of-use assets, net

 

 

120,747

 

 

 

71,035

 

Deferred income taxes

 

 

546

 

 

 

9,409

 

Other long-term assets

 

 

10,707

 

 

 

3,476

 

Total Assets

 

$

2,935,009

 

 

$

2,598,996

 

Liabilities and Equity

 

 

 

 

Current Liabilities:

 

 

 

 

Accounts payable

 

$

292,734

 

 

$

244,100

 

Income tax payable

 

 

6,322

 

 

 

5,521

 

Accrued compensation and employee benefits

 

 

45,576

 

 

 

61,273

 

Customer liabilities

 

 

121,576

 

 

 

99,447

 

Lease obligations

 

 

16,230

 

 

 

13,789

 

Other current liabilities

 

 

82,166

 

 

 

77,781

 

Total current liabilities

 

 

564,604

 

 

 

501,911

 

Long-term debt

 

 

762,687

 

 

 

760,537

 

Long-term lease obligations

 

 

105,517

 

 

 

57,975

 

Deferred income taxes

 

 

22,346

 

 

 

15,640

 

Other long-term liabilities

 

 

11,736

 

 

 

13,146

 

Total Liabilities

 

 

1,466,890

 

 

 

1,349,209

 

Equity:

 

 

 

 

Common stock, $0.01 par value, 1,000,000,000 shares authorized, 37,317,893 and 41,351,350 shares issued and outstanding, respectively

 

 

374

 

 

 

415

 

Treasury stock, held at cost, 0 and 260,900 shares, respectively

 

 

 

 

 

(2,580

)

Additional paid-in capital

 

 

506,783

 

 

 

500,117

 

Retained earnings

 

 

994,902

 

 

 

801,981

 

Accumulated other comprehensive loss

 

 

(33,940

)

 

 

(50,146

)

Total Equity

 

 

1,468,119

 

 

 

1,249,787

 

Total Liabilities and Equity

 

$

2,935,009

 

 

$

2,598,996

 

ATKORE INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

(in thousands)

 

September 30, 2023

 

September 30, 2022

Operating activities

 

 

 

 

Net income

 

$

689,899

 

 

$

913,434

 

Adjustments to reconcile net income to net cash provided by operating activities

 

 

 

 

Depreciation and amortization

 

 

115,524

 

 

 

84,415

 

Amortization of debt issuance costs and original issue discount

 

 

2,151

 

 

 

2,151

 

Deferred income taxes

 

 

12,860

 

 

 

3,054

 

Provision for losses on accounts receivable and inventory

 

 

5,269

 

 

 

10,235

 

Stock-based compensation expense

 

 

21,101

 

 

 

17,245

 

Amortization of right of use asset

 

 

20,321

 

 

 

13,916

 

Other adjustments to net income

 

 

7,481

 

 

 

4,850

 

Changes in operating assets and liabilities, net of effects from acquisitions

 

 

 

 

Accounts receivable

 

 

(30,278

)

 

 

17,749

 

Inventories

 

 

(42,419

)

 

 

(160,980

)

Prepaid expenses and other current assets

 

 

(11,152

)

 

 

(21,718

)

Accounts payable

 

 

32,298

 

 

 

(28,968

)

Income taxes

 

 

(3,088

)

 

 

(92,802

)

Accrued and other liabilities

 

 

(10,176

)

 

 

27,198

 

Other, net

 

 

(2,157

)

 

 

(2,944

)

Net cash provided by operating activities

 

 

807,634

 

 

 

786,835

 

Investing activities

 

 

 

 

Capital expenditures

 

 

(218,888

)

 

 

(135,776

)

Proceeds from sale of properties, plant and equipment

 

 

123

 

 

 

779

 

Acquisitions of businesses, net of cash acquired

 

 

(83,385

)

 

 

(307,805

)

Net cash used for investing activities

 

 

(302,150

)

 

 

(442,802

)

Financing activities

 

 

 

 

Issuance of common stock, net of taxes withheld

 

 

(14,428

)

 

 

(24,045

)

Repurchase of common stock

 

 

(491,033

)

 

 

(500,161

)

Finance lease payments

 

 

(1,320

)

 

 

 

Net cash used for financing activities

 

 

(506,781

)

 

 

(524,206

)

Effects of foreign exchange rate changes on cash and cash equivalents

 

 

661

 

 

 

(7,365

)

Increase (decrease) in cash and cash equivalents

 

 

(637

)

 

 

(187,538

)

Cash and cash equivalents at beginning of period

 

 

388,751

 

 

 

576,289

 

Cash and cash equivalents at end of period

 

$

388,114

 

 

$

388,751

 

(in thousands)

 

September 30, 2023

 

September 30, 2022

Supplementary Cash Flow information

 

 

 

 

Interest paid

 

$

43,670

 

 

30,529

 

Income taxes paid, net of refunds

 

 

150,934

 

 

379,769

 

Capital expenditures, not yet paid

 

 

7,893

 

 

8,653

 

Acquisitions of businesses, not yet paid

 

 

13,625

 

 

12,628

 

Operating cash flows from cash paid on operating lease liabilities

 

 

15,155

 

 

12,549

 

Operating lease right-of-use assets obtained in exchange for lease liabilities

 

 

63,644

 

 

38,794

 

 

 

 

 

 

Free Cash Flow:

 

 

 

 

Net cash provided by operating activities

 

 

807,634

 

 

786,835

 

Capital expenditures

 

 

(218,888

)

 

(135,776

)

Free Cash Flow:

 

 

588,746

 

 

651,059

 

ATKORE INC.

ADJUSTED EBITDA

 

The following table presents reconciliations of Adjusted EBITDA to net income for the periods presented:

 

 

 

Three Months Ended

 

Fiscal Year Ended

(in thousands)

 

September 30, 2023

 

September 30, 2022

 

September 30, 2023

 

September 30, 2022

Net income

 

$

140,925

 

 

$

220,802

 

$

689,899

 

$

913,434

Income tax expense

 

 

39,537

 

 

 

66,557

 

 

160,391

 

 

290,186

Depreciation and amortization

 

 

30,853

 

 

 

23,947

 

 

115,524

 

 

84,415

Interest expense, net

 

 

8,588

 

 

 

9,000

 

 

35,232

 

 

30,676

Stock-based compensation

 

 

3,001

 

 

 

3,065

 

 

21,101

 

 

17,245

(Gain) loss on assets held for sale

 

 

(86

)

 

 

 

 

7,477

 

 

Transaction costs

 

 

35

 

 

 

150

 

 

968

 

 

3,424

Other (a)

 

 

9,125

 

 

 

1,564

 

 

11,535

 

 

2,410

Adjusted EBITDA

 

$

231,978

 

 

$

325,085

 

$

1,042,127

 

$

1,341,790

 

 

 

 

 

 

 

 

 

(a) Represents other items, such as inventory reserves and adjustments, loss on disposal of property, plant and equipment, insurance recovery related to damages of property, plant and equipment, release of indemnified uncertain tax positions and realized or unrealized gain (loss) on foreign currency impacts of intercompany loans, certain legal matters, restructuring charges, and related forward currency derivatives.

The following table presents calculations of Adjusted EBITDA Margin for Atkore Inc. for the periods presented:
 

 

Three Months Ended

 

Fiscal Year Ended

(in thousands)

September 30, 2023

 

September 30, 2022

 

Change

 

% Change

 

September 30, 2023

 

September 30, 2022

 

Change

 

% Change

Net sales

$

869,889

 

 

$

1,028,986

 

 

$

(159,097

)

 

(15.5

)%

 

$

3,518,761

 

 

$

3,913,949

 

 

$

(395,188

)

 

(10.1

)%

Adjusted EBITDA

$

231,978

 

 

$

325,085

 

 

$

(93,107

)

 

(28.6

)%

 

$

1,042,127

 

 

$

1,341,790

 

 

$

(299,663

)

 

(22.3

)%

Adjusted EBITDA Margin

 

26.7

%

 

 

31.6

%

 

 

 

 

 

 

29.6

%

 

 

34.3

%

 

 

 

 

ATKORE INC.

SEGMENT INFORMATION

 

The following tables represent calculations of Adjusted EBITDA Margin by segment for the periods presented:

 

 

Three Months Ended

 

September 30, 2023

 

September 30, 2022

(in thousands)

Net sales

 

Adjusted EBITDA

 

Adjusted EBITDA Margin

 

Net sales

 

Adjusted EBITDA

 

Adjusted EBITDA Margin

Electrical

$

649,787

 

 

$

237,577

 

36.6

%

 

$

795,220

 

 

$

308,783

 

38.8

%

Safety & Infrastructure

 

220,239

 

 

$

15,139

 

6.9

%

 

 

233,884

 

 

$

36,371

 

15.6

%

Eliminations

 

(137

)

 

 

 

 

 

 

(118

)

 

 

 

 

Consolidated operations

$

869,889

 

 

 

 

 

 

$

1,028,986

 

 

 

 

 

 

Fiscal Year Ended

 

September 30, 2023

 

September 30, 2022

(in thousands)

Net sales

 

Adjusted EBITDA

 

Adjusted EBITDA Margin

 

Net sales

 

Adjusted EBITDA

 

Adjusted EBITDA Margin

Electrical

$

2,675,074

 

 

$

1,004,853

 

37.6

%

 

$

3,013,755

 

 

$

1,273,410

 

42.3

%

Safety & Infrastructure

 

844,158

 

 

$

103,231

 

12.2

%

 

 

900,588

 

 

$

138,390

 

15.4

%

Eliminations

 

(471

)

 

 

 

 

 

 

(394

)

 

 

 

 

Consolidated operations

$

3,518,761

 

 

 

 

 

 

$

3,913,949

 

 

 

 

 

ATKORE INC.

ADJUSTED NET INCOME PER SHARE

 

The following table presents reconciliations of Adjusted net income to net income for the periods presented:

 

 

Three Months Ended

 

Fiscal Year Ended

(in thousands, except per share data)

September 30, 2023

 

September 30, 2022

 

September 30, 2023

 

September 30, 2022

Net income

$

140,925

 

 

$

220,802

 

 

$

689,899

 

 

$

913,434

 

Stock-based compensation

 

3,001

 

 

 

3,065

 

 

 

21,101

 

 

 

17,245

 

Intangible asset amortization

 

15,027

 

 

 

10,622

 

 

 

57,804

 

 

 

36,176

 

(Gain) loss on assets held for sale

 

(86

)

 

 

 

 

 

7,477

 

 

 

 

Other (a)

 

8,888

 

 

 

692

 

 

 

11,058

 

 

 

799

 

Pre-tax adjustments to net income

 

26,830

 

 

 

14,379

 

 

 

97,440

 

 

 

54,220

 

Tax effect

 

(6,708

)

 

 

(3,595

)

 

 

(24,360

)

 

 

(13,555

)

Adjusted net income

$

161,047

 

 

$

231,586

 

 

$

762,979

 

 

$

954,099

 

 

 

 

 

 

 

 

 

Weighted-Average Diluted Common Shares Outstanding

 

38,251

 

 

 

41,960

 

 

 

39,328

 

 

 

44,280

 

Net income per diluted share (b)

$

3.63

 

 

$

5.18

 

 

$

17.27

 

 

$

20.30

 

Adjusted net income per diluted share (c)

$

4.21

 

 

$

5.52

 

 

$

19.40

 

 

$

21.55

 

 

(a) Represents other items, such as inventory reserves and adjustments, loss on disposal of property, plant and equipment, insurance recovery related to damages of property, plant and equipment, release of indemnified uncertain tax positions and realized or unrealized gain (loss) on foreign currency impacts of intercompany loans and related forward currency derivatives.

 

(b) The Company calculates basic and diluted net income per common share using the two-class method. Under the two-class method, net earnings are allocated to each class of common stock and participating securities as if all the net earnings for the period had been distributed. The Company's participating securities consist of share-based payment awards that contain a non-forfeitable right to receive dividends and therefore are considered to participate in undistributed earnings with common stockholders. Included within the calculation of net income per diluted share is 10,637 and 14,460 of undistributed earnings allocated to participating securities for fiscal years ended 2023 and 2022. Included within the calculation of net income per diluted share is See Note 8, “Earnings Per Share” in our Annual Report on Form 10-K.

 

(c) Adjusted net income per diluted share is calculated by taking adjusted net income and divided by the weighted-average diluted common shares outstanding.

ATKORE INC.

NET DEBT

The following table presents reconciliations of Net Debt to Total Debt for the periods presented: 

 

(in thousands)

September 30, 2023

 

September 30, 2022

 

September 30, 2021

 

Long-term debt

 

762,687

 

 

760,537

 

 

758,386

 

Total Debt

 

762,687

 

 

760,537

 

 

758,386

 

Less cash and cash equivalents

 

388,114

 

 

388,751

 

 

576,289

 

Net Debt

$

374,573

 

$

371,786

 

$

182,097

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

1,042,127

 

$

1,341,790

 

$

897,547

 

 

 

 

 

 

 

 

 

Contacts

Media Contact:

Lisa Winter

Vice President - Communications

708-225-2453

LWinter@atkore.com

Investor Contact:

John Deitzer

Vice President - Treasury and Investor Relations

708-225-2124

JMDeitzer@atkore.com

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