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Forward Looking Statements
This presentation may contain forward-looking statements made pursuant to the safe harbor provisions of thePrivate Securities Litigation Reform Act of 1995. Forward-looking statements speak only as of the date of thispresentation and are subject to change. The Company undertakes no obligation to update or reviseforward-looking statements to reflect new circumstances or unanticipated events as they occur. Actual results maydiffer materially due to a variety of factors, including the sensitivity of our business to weather conditions,changes in the economy and the housing market, our ability to maintain favorable relationships with suppliers andmanufacturers, competition from other leisure product alternatives and mass merchants, excess tax benefits ordeficiencies recognized under ASU 2016-09 and other risks detailed in POOLCORP’s 2018 Annual Report onForm 10-K filed with the Securities and Exchange Commission.
This presentation may also contain references to certain non-GAAP financial measures as defined by the SEC. Areconciliation of non-GAAP financial measures to their most directly comparable financial measures calculatedand presented in accordance with generally accepted accounting principles can be found in the Appendix at theend of this presentation, if applicable at http://ir.poolcorp.com/NonGAAP_Financial_Measures, or in theCompany’s most recent earnings release, which is furnished in our Current Report on Form 8-K filed with the SEC.
NASDAQ/GSM: POOL
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POOLCORP Overview
o Undisputed leader in highly fragmented, niche distribution market with favorable growth dynamics
o High organic growth and recurring revenue (60%+) mitigates risk
o Value-add business model and focus on operating leverage drives high operating margins
o Exceptional performance history – 26.0% Total Shareholder Return CAGR over 23 years
NASDAQ/GSM: POOL
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POOLCORP Global Network Revenue
Vision: ‘To be the best worldwide distributor of outdoor lifestyle home products’
Overview
NASDAQ/GSM: POOL
Global Network Sales Centers
Americas Pool 276
Irrigation & Landscape 67
Europe/Australia 21
Total 364
4
POOLCORP Worldwide
‘Over 360 sales and distribution centers serving major pool and irrigation markets worldwide’
Overview
NASDAQ/GSM: POOL
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Americas
1
1
21
1
1
1
1
22
2
2
2
23
6
3
3
54 4
4
5
4
4
45
55
6
6
7
8
8
4
7724
48
45
1
17
2
3
1
Europe/Australia
1
3
1
6
22
11 1
1 1
1
1
9
Value-Added Distribution
‘Adding value in a fragmented supply chain’
Overview
NASDAQ/GSM: POOL
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Superior ServiceSelection
ConveniencePrice
Exceptional Value
Local availability
Convenient locations
Broad product selection
Same/next day delivery
Credit
Technical support
Field-based sales force
Marketing programs
B2B eCommerce
Retail support services
120,000 Customers
Pool & Landscape Maintenance &
Service Companies
Construction/ Remodeling Contractors
Specialty Retailers
Online Resellers
National Accounts
180,000 products
Demand creation
Marketing & promotion
Supply & logistics mgmt
Warranty support
Product training
Over 2,200 Vendors
M
f
r
B
r
a
n
d
s
75%
25%
P
L
E
X
NASDAQ/GSM: POOL
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0
30
60
90
120
150
180
210
Ind
exe
d R
etu
rn
Exceptional Shareholder Returns
YE2018 value of $10,000 invested at POOL IPO in October 1995*
POOL $2,041,598
S&P MidCap 400 $104,740
S&P 500 $62,931 Compound Annual Value
Growth Rate
(1995 – 2018)
POOL26.0%
S&P 500
8.3%
S&P MidCap 400
10.8%
Overview
Total ReturnCAGR
Source: Standard & Poor’s
* Including dividend reinvestment
‘Creating exceptional value over the long-term’
Financial Results
‘Consistent revenue and gross profit growth’
Overview
NASDAQ/GSM: POOL
Source: Company Financial Data
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Financial Results
‘Operating leverage generating strong earnings and investment returns’
Overview
NASDAQ/GSM: POOL
Source: Company Financial Data(1) See Appendix for Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS. CAGR excludes 2017-18 adjustments for tax and accounting changes.(2) See Appendix for ROIC calculation.
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Capital Allocation Priorities
Capital Deployment
-Maintaining Leverage at 1.5x – 2.0x
Share Repurchase/ Debt Repayment
Dividends
Acquisitions
Capital Expenditures
$150 to $200 million
$70 to $80 million
$5 to $15 million
$35 to $40 million
Overview
‘Capital deployment balancing growth and shareholder returns’
NASDAQ/GSM: POOL
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Expected Near Term Range
Returning Excess Cash to Stockholders
‘$2 billion in cash returned to shareholders since IPO’
Overview
NASDAQ/GSM: POOL
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U.S. Pool Market
POOLAmericas
85% of Total POOLCORP Revenue(96% U.S.; 4% Canada, Mexico & South America)
US Blue
* Includes commercial and adjacent product categories
NASDAQ/GSM: POOL
Pool & Related Outdoor Living Product Vendors$11.5 Billion Market*
Wholesale DistributionLarge & Small Pool Construction Contractors, Pool Maintenance & Repair Companies, Pool
Specialty Retailers
Pool Owners & Commercial Pool Operators
U.S. POOL Market Overview
‘Wholesale distribution is the primary channel to market in the pool industry’
Source: Company estimates at wholesale values
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Large Retail & Building Contractors
Mass Merchants, Pool Specialty Retail Chains, Large Online
Retailers
70% 30%
U.S. ‘Blue’ Product Sales
‘More than 180,000 industry-leading products from over 2,200 suppliers’
US Blue
NASDAQ/GSM: POOL
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U.S. ‘Blue’ Distribution Channels
‘Over 65,000 customers purchasing an average of $35,000 per year’
US Blue
NASDAQ/GSM: POOL
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U.S. In-Ground Pools
o Est. 5.3 million U.S. in-ground pools in 2018 drives 85%+ of POOL blue sales
o New pool construction adds 1% -2% per year to installed base
o Aging installed base drives renovation and remodel revenue
o New features increase new pool and remodel spend
o New pool construction returning to ‘normalized’ levels
o New pool construction growth limited by labor availability
‘Installed base grows as new pool construction recovers’
US Blue
NASDAQ/GSM: POOL
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Major External ImpactsUS Blue
NASDAQ/GSM: POOL
Source: NOAA
Short-Term: Weather
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‘Weather is the biggest external factor affecting short term demand’
Warmer temperatures across eastern U.S. markets in 2018
Higher rainfall impacted eastern and central U.S. markets in 2018
2017 Avg Regional Temperature Rankings 2018 Avg Regional Temperature Rankings
2017 Avg Regional Precipitation Rankings 2018 Avg Regional Precipitation Rankings
Major External ImpactsUS Blue
NASDAQ/GSM: POOL
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Sources: Census Bureau; Weldon Cooper Center, Demographics Research Group
Long-Term: Housing Market & Population Migration
‘Housing and population trends favor continued growth in outdoor living’
Pop Decrease> 5 million + 0.5 – 1 million+ 1 – 5 million + 0 – 0.5 million
Projected U.S Population Growth through 2040
Sustainable Competitive Advantages
Industry-specifico Recurring maintenance spend from
growing pool installed base
o Contractor knowledge; professional installation
o On-demand local supply and fulfillment requirements
o Lack of brand awareness
o Favorable demographics
o Product innovation and changing consumer preferences drive growth
POOL-specifico Nationwide network and
reach
o Scale & capital strength
o Operating leverage and superior execution
o Performance-based culture focused on growth and value creation
‘Powerful business model with high recurring revenue, scale and low cyclicality’
NASDAQ/GSM: POOL
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US Blue
Irrigation & Landscape Distribution
9% of Total POOLCORP Revenue
Horizon o 3rd largest US irrigation and landscape
maintenance products distributor; multi-regional footprint
o Focused on expansion in higher growth US sunbelt markets
o Highly fragmented market with consolidation opportunity
o Similar dynamics to Blue business though with higher correlation to new home construction
o 15%+ contribution margin with sales growth
US Green
Irrigation products
Outdoor living products
Landscape & Equipment
Target Categories
NASDAQ/GSM: POOL
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‘Green business dynamics similar to Blue business’
Horizon Revenue & Operating Margin
‘Organic growth, acquisitions and execution driving improved performance’Source: Company financial information
US Green
NASDAQ/GSM: POOL
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POOLEurope/Australia
6% of Total POOLCORP Revenue
Europe/Australiao Presence in largest swimming pool
markets
o Smaller installed base than Americas suggests higher market growth potential
o Focus on improving performance with longer term network expansion strategy
o Europe/Australia base business revenues up 16% in 2018 with continued expansion opportunities
Region # of Sales Centers
Western Europe 15
Australia 6
Europe/Australia
‘High organic international growth with opportunistic acquisitions’
NASDAQ/GSM: POOL
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POOL Organic Growth Drivers
Growth Contributors2019 - 2023
Annual Revenue Growth Range
Installed Base Growth 1% - 2%
Inflation 1% - 3%
Aging Base Remodel/New Construction Recovery 2% - 3%
Industry Growth Contributors 4% - 7%
Market Share Gains & New Products 2% - 3%
Total POOL Revenue Growth Range 6% - 9%
‘Strong industry and Company growth attributes’
Summary
NASDAQ/GSM: POOL
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POOL Financial Model
Financial Measurement2014-2018Statistics
2019 - 2023Outlook
Revenue Growth 5% - 9% 6% - 9%
Gross Profit Margins 28.6% - 29.0% Stable
Contribution Margin(1) 14% - 23% Mid-teens %
Share Repurchases$100 - $185
million$150 - $250
million
Earnings per Share Growth 15% - 23% Mid-teens %
‘Outlook remains positive’
Summary
NASDAQ/GSM: POOL
(1) Incremental Operating Income Growth/Incremental Sales Growth* Excludes ASU 2016-09 effects
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Summary
oPositive industry dynamics drive above-market growth
oSustainable competitive advantages with highly experienced team
oConsistent, exceptional investment performance
NASDAQ/GSM: POOL
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Appendix
NASDAQ/GSM: POOL
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Reconciliation of Reported Dilluted EPS to Adjusted Diluted EPS FYE 12/31/18 FYE 12/31/17
Reported Diluted EPS before adjustments and effects of tax and accounting changes $5.62 $4.51
Less:
Per diluted share effect of application of ASU 2016-09, Improvements to Employee Share-Based Payment
Accounting, standard(0.36) (0.24)
Per diluted share provisional tax benefit recorded for remeasurement of deferred tax liabilities upon enactment of
the Tax Cut and Jobs Act(0.28)
Adjusted Diluted EPS $5.26 $3.99
Reconciliation of Net Income to Adjusted EBITDA FYE 12/31/18 FYE 12/31/17 FYE 12/31/16 FYE 12/31/15 FYE 12/31/14 FYE 12/31/13
Net income ($ in thousands) $234,461 $191,339 $148,603 $128,224 $111,030 $97,330
Add:
Interest expense (1) 20,336 15,360 13,802 7,298 7,208 6,528
Provision for income taxes 58,774 77,982 92,931 80,137 70,559 61,590
Share-based compensation 12,874 12,482 9,902 9,543 9,065 8,150
Goodwill impairment - - 613 - - -
Equity (earnings) losses in unconsolidated investments, net of tax (242) (139) (156) (211) (204) (182)
Depreciation 26,122 24,157 20,338 16,373 14,495 13,359
Amortization (2) 1,102 976 1,012 398 845 825
Adjusted EBITDA $353,427 $322,157 $287,045 $241,762 $212,998 $187,600
(1) Shown net of interest income, impact of foreign currency transactions and includes amortization of deferred financing costs
(2) Excludes amortization of deferred financing costs
Return on Invested Capital 2018 2017 2016 (2) 2015 (2) 2014 (2) 2013 (2)
Numerator (trailing four quarters total):
Net Income attributable to Pool Corporation (1) $234,461 $179,633 $148,955 $128,275 $110,692 $97,330
Interest and other non-operating expenses, net 20,896 15,189 14,481 8,072 7,485 6,748
Less: taxes on Interest and other non-operating expenses, net at 20.1% for 2018,
33.4%(1) for 2017 and at respective effective tax rates for previous years(4,200) (5,073) (5,575) (3,108) (2,912) (2,618)
$251,157 $189,749 $157,861 $133,239 $115,265 $101,460
Denominator (average of trailing four quarters):
Long-term debt, net $602,984 $520,950 $441,026 $400,204 $366,407 $271,455
Short-term borrowings and current portion of long-term debt 15,190 11,030 3,806 1,732 1,038 16
Total stockholders’ equity (1) 286,979 236,901 237,380 254,298 257,502 313,401
$905,153 $768,881 $682,212 $656,234 $624,947 $584,872
Return on invested capital 27.7% 24.7% 23.1% 20.3% 18.4% 17.3%
(1) We reduced Net income attributable for Pool Corporation for 2017 by $12.0 million in calculating ROIC for the year. This amount represents our benefit related to the enactment of the Tax Cuts and Jobs Act.
We also adjusted our effective tax rate and our December 31, 2018 and 2017 retained earnings balance for this benefit. ROIC for 2018 and 2017 based on reported amounts is 27.5% and 26.2%
(2) Our 2013-2016 ROIC calculations have been conformed to our 2017-2018 presentation.