Myers Industries Announces Second Quarter 2023 Results

Self-Help Initiatives Sustain Gross Margin Profile

Continuing to Invest in Growth and Capabilities, while Prudently Managing Costs

AKRON, Ohio--(BUSINESS WIRE)-- Myers Industries, Inc. (NYSE: MYE), a leading manufacturer of a wide range of polymer and metal products and distributor for the tire, wheel, and under-vehicle service industry, today announced results for the second quarter ended June 30, 2023.

Second Quarter 2023 Financial Highlights

• Net sales of $208.5 million compared to $233.2 million in the prior year period
• Gross margin of 32.8%, up 80 basis points versus the prior year period
• GAAP net income per diluted share of $0.29 compared to $0.43 in the prior year period
• Adjusted earnings per diluted share of $0.35 compared to $0.45 in the prior year period
• Cash flow provided by operations was $22.9 million and free cash flow was $16.7 million

Myers Industries’ President and CEO Mike McGaugh said “I am pleased with our business’s ability to maintain gross margins and navigate a more complex operating environment during the second quarter while facing macro-economic and inflationary headwinds. Our self-help initiatives drove further margin expansion, allowing us to continue making capital investments in our plants and investments in our M&A and Commercial Excellence processes and capabilities. We are working to drive a more variable cost structure and we are well positioned to meet the demand when key markets recover. We also see strong demand for our agriculture and military products, and our e-commerce initiative has strong momentum. There are also very good dynamics for the tire market given the growth of electric vehicles, which bodes well for our Distribution segment, where we are refocusing our sales and sourcing structure, and integrating our Mohawk acquisition to enable us to better capture this market opportunity.

Recognizing softer demand in our RV and Marine end markets, we have taken meaningful cost reduction actions to mitigate bottom line impact. We adjusted operating costs to match production requirements and increased efficiencies, including deactivating one of our Roto Molding facilities. As we drive targeted cost containment initiatives in our businesses that serve the RV and Marine industries, we continue to evaluate consolidating opportunities and decreasing capacity where needed, while retaining an appropriate level of reserved capacity to activate when market conditions improve.

We are continuing to invest in our people and processes for future growth, while also working to better align our manufacturing and SG&A costs to match current market conditions. Given the current macro challenges, we have elected to lower our revenue guidance for the full year; however, due to our demonstrated ability to deliver operational improvements, price increases and self-help measures, we believe our earnings capability will be resilient and we are maintaining our adjusted EPS guidance.

We continue to maintain a strong balance sheet, supported by consistent free cash generation. We also continue to develop and evaluate a strong pipeline of potential acquisition opportunities, while exercising discipline in evaluating those opportunities, including walking away when the economics aren't right."

McGaugh concluded "We have the right strategy and the right team to continue to execute and further transform Myers into a high-growth, world class organization while delivering significant value to our stakeholders.”

Second Quarter 2023 Financial Summary

		Quarter Ended June 30,
(Dollars in thousands, except per share data)		2023		2022		% Inc (Dec)
Net sales		$208,453		$233,156		(10.6)%
Gross profit		$68,410		$74,716		(8.4)%
Gross margin		32.8%		32.0%
Operating income		$16,142		$22,617		(28.6)%
Net income		$10,605		$15,831		(33.0)%
Net income per diluted share		$0.29		$0.43		(32.6)%
Adjusted operating income		$19,027		$23,618		(19.4)%
Adjusted net income		$12,928		$16,581		(22.0)%
Adjusted earnings per diluted share		$0.35		$0.45		(22.2)%
Adjusted EBITDA		$24,704		$28,860		(14.4)%

Net sales were $208.5 million, a decrease of $24.7 million, or 10.6%, compared with $233.2 million for the second quarter of 2022. The decrease was the result of lower sales in the Material Handling segment, partially offset by higher sales in the Distribution segment largely from incremental sales of $9.3 million from the Mohawk Rubber acquisition. On an organic basis, the contribution from higher pricing in the Distribution segment was more than offset by lower volumes in both segments.

Gross profit decreased $6.3 million, or 8.4% to $68.4 million, as the contribution from lower raw material costs and the Mohawk Rubber acquisition was not enough to offset lower volumes. Gross margin expanded 80 basis points to 32.8% compared with 32.0% for the second quarter of 2022. Selling, general and administrative expenses were flat for the second quarter of 2023 compared to the same period last year. SG&A as a percentage of sales increased to 25.1%, compared with 22.4% in the same period last year. After removing the adjusting items, SG&A was down year over year by $1.7 million. SG&A also included $1.3 million of consulting expense that was used to increase and strengthen Myers capabilities as the company moves into the Horizon-2 strategy. Net income per diluted share was $0.29, compared with $0.43 for the second quarter of 2022. Adjusted earnings per diluted share were $0.35, compared with $0.45 for the second quarter of 2022.

Second Quarter 2023 Segment Results

(Dollar amounts in the segment tables below are reported in millions)

Material Handling

	Net Sales		Op Income		Op Income Margin		Adj EBITDA		Adj EBITDA Margin
Q2 2023 Results	$143.3		$24.8		17.3%		$29.9		20.8%
Q2 2022 Results	$173.1		$28.0		16.2%		$32.5		18.8%
$ Increase (decrease) vs prior year	($29.8)		($3.2)				($2.7)
% Increase (decrease) vs prior year	(17.2)%		(11.4)%		+110 bps		(8.2)%		+200 bps
Items in this table may not recalculate due to rounding

Net sales for the Material Handling segment were $143.3 million, a decrease of $29.8 million, or 17.2%, compared with $173.1 million for the second quarter of 2022. Net sales decreased in the vehicle, industrial and consumer end markets, led by reduced demand for RV and marine products, as well as being impacted by the timing of food & beverage sales. Operating income decreased 11.4% to $24.8 million, compared with $28.0 million in the second quarter of 2022. Operating income margin improved to 17.3% compared with 16.2% for the second quarter of 2022. Adjusted EBITDA margin improved by 200 basis points, primarily attributed to self-help initiatives, partially dampened by a decrease in sales volume. Adjusted EBITDA decreased 8.2% to $29.9 million, compared with $32.5 million in the second quarter of 2022. Lower sales volume and pricing more than offset lower raw material costs and a favorable mix. SG&A expenses were lower year-over-year, primarily due to a decrease in legal fees and lower salaries.

Distribution

	Net Sales		Op Income		Op Income Margin		Adj EBITDA		Adj EBITDA Margin
Q2 2023 Results	$65.2		$3.4		5.2%		$4.7		7.2%
Q2 2022 Results	$60.1		$4.3		7.1%		$4.9		8.1%
$ Increase (decrease) vs prior year	$5.1		($0.9)				($0.2)
% Increase (decrease) vs prior year	8.5%		(20.4)%		-190 bps		(3.7)%		-90 bps
Items in this table may not recalculate due to rounding

Net sales for the Distribution segment were $65.2 million, an increase of $5.1 million, or 8.5%, compared with $60.1 million for the second quarter of 2022. Excluding the incremental $9.3 million of net sales from the Mohawk Rubber acquisition, organic net sales decreased 6.9%. Operating income decreased $0.9 million to $3.4 million, compared with $4.3 million for the second quarter of 2022. Adjusted EBITDA decreased 3.7% to $4.7 million, compared with $4.9 million in the second quarter of 2022. The decrease in operating income and adjusted EBITDA was primarily due to an increase in product costs and higher SG&A expenses. The increase in SG&A expenses was primarily the result of the Mohawk Rubber acquisition and higher salaries. The Distribution segment's operating income margin was 5.2% compared with 7.1% for the second quarter of 2022. The Distribution segment’s adjusted EBITDA margin was 7.2%, compared with 8.1% for the second quarter of 2022. The Distribution Segment continues to integrate the Mohawk Rubber acquisition and is implementing pricing actions to counter cost inflation and improve margin.

Balance Sheet & Cash Flow

As of June 30, 2023, the Company’s cash on hand totaled $30.7 million. Total debt as of June 30, 2023 was $88.2 million.

For the second quarter of 2023, cash flow provided by operations was $22.9 million and free cash flow was $16.7 million, compared with cash flow provided by operations of $27.0 million and free cash flow of $21.1 million for the second quarter of 2022. The decrease in cash flow was driven primarily by lower earnings. Capital expenditures for the second quarter of 2023 were $6.1 million, compared with $5.9 million for the second quarter of 2022.

2023 Outlook

Based on current exchange rates, market outlook, and business forecast, the Company revised its outlook for fiscal 2023, and currently forecasts:

• Net sales decline in the mid single digit range
• Net income per diluted share in the range of $1.41 to $1.73
• Maintain adjusted earnings per diluted share range of $1.55 to $1.85
• Capital expenditures to be in the range of $25 to $30 million
• Effective tax rate to approximate 25%

We will continue to monitor market conditions and provide updates as we progress throughout the year.

Conference Call Details

The Company will host an earnings conference call and webcast for investors and analysts on Tuesday, August 3, 2023, 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: https://www.netroadshow.com/events/login?show=95bfe4bb&confId=52763. Upon registering, each participant will be provided with call details and a registrant ID. Reminders will also be sent to registered participants via email. Alternatively, the conference call will be available via a live webcast. To access the live webcast or a replay, visit the Company's website www.myersindustries.com and click on the Investor Relations tab. 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 Local) 1-929-458-6194 or (US Toll-Free) 1-866-813-9403.

Use of Non-GAAP Financial Measures

The Company uses certain non-GAAP measures in this release. Adjusted operating income (loss), adjusted operating income margin, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted EBITDA margin, adjusted net income, adjusted earnings per diluted share (adjusted EPS), 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 sustainable plastic and metal 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 contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, including information regarding the Company’s financial outlook, future plans, objectives, business prospects and anticipated financial performance. Forward-looking statements can be identified by words such as “will,” “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” or variations of these words, or similar expressions. These forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on the Company’s current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, these statements inherently involve a wide range of inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. The Company’s actual actions, results, and financial condition may differ materially from what is expressed or implied by the forward-looking statements.

Specific factors that could cause such a difference on our business, financial position, results of operations and/or liquidity include, without limitation, raw material availability, increases in raw material costs, or other production costs; 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; impacts from the novel coronavirus (“COVID-19”) pandemic; and other risks and uncertainties detailed from time to time in the Company’s filings with the SEC, including without limitation, the risk factors disclosed in Item 1A, “Risk Factors,” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Given these factors, as well as other variables that may affect our operating results, readers should not rely on forward-looking statements, assume that past financial performance will be a reliable indicator of future performance, nor use historical trends to anticipate results or trends in future periods. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company expressly disclaims any obligation or intention to provide updates to the forward-looking statements and the estimates and assumptions associated with them.

M-INV

MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (Dollars in thousands, except share and per share data)
		Quarter Ended								Six Months Ended
		June 30, 2023				June 30, 2022				June 30, 2023				June 30, 2022
Net sales		$	208,453			$	233,156			$	424,192			$	458,642
Cost of sales			140,043				158,440				284,717				311,998
Gross profit			68,410				74,716				139,475				146,644
Selling, general and administrative expenses			52,351				52,320				104,432				100,310
(Gain) loss on disposal of fixed assets			(83	)			(221	)			(56	)			(688	)
Operating income (loss)			16,142				22,617				35,099				47,022
Interest expense, net			1,790				1,211				3,436				2,358
Income (loss) before income taxes			14,352				21,406				31,663				44,664
Income tax expense (benefit)			3,747				5,575				8,082				11,496
Net income (loss)		$	10,605			$	15,831			$	23,581			$	33,168
Net income (loss) per common share:
Basic		$	0.29			$	0.43			$	0.64			$	0.91
Diluted		$	0.29			$	0.43			$	0.64			$	0.91
Weighted average common shares outstanding:
Basic			36,761,916				36,397,547				36,663,345				36,338,907
Diluted			36,892,177				36,623,495				36,874,084				36,577,192

MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED) (Dollars in thousands)
		June 30, 2023				December 31, 2022
Assets
Current Assets
Cash		$	30,692			$	23,139
Accounts receivable, net			116,771				133,716
Inventories, net			98,238				93,351
Other current assets			10,919				7,001
Total Current Assets			256,620				257,207
Property, plant, & equipment, net			106,635				101,566
Right of use asset - operating leases			27,518				28,908
Deferred income taxes			129				129
Other assets			151,808				154,824
Total Assets		$	542,710			$	542,634
Liabilities & Shareholders' Equity
Current Liabilities
Accounts payable		$	81,744			$	73,536
Accrued expenses			50,349				57,531
Operating lease liability - short-term			5,691				6,177
Finance lease liability - short-term			534				518
Long-term debt - current portion			25,989				—
Total Current Liabilities			164,307				137,762
Long-term debt			52,986				93,962
Operating lease liability - long-term			21,982				22,786
Finance lease liability - long-term			8,645				8,919
Other liabilities			11,414				15,270
Deferred income taxes			8,954				7,508
Total Shareholders' Equity			274,422				256,427
Total Liabilities & Shareholders' Equity		$	542,710			$	542,634

MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollars in thousands)
		Quarter Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
Cash Flows From Operating Activities
Net income		$	10,605			$	15,831			$	23,581			$	33,168
Adjustments to reconcile net income to net cash provided by (used for) operating activities
Depreciation and amortization			5,677				5,241				11,295				10,441
Amortization of deferred financing costs			78				121				156				242
Non-cash stock-based compensation expense			2,488				2,133				4,392				3,860
Gain on disposal of fixed assets			(83	)			(221	)			(56	)			(688	)
Other			3,319				177				2,492				698
Cash flows provided by (used for) working capital
Accounts receivable			11,915				10,694				15,096				(21,200	)
Inventories			4,048				(1,279	)			(4,730	)			(7,259	)
Prepaid expenses and other current assets			(5,048	)			(6,316	)			(3,828	)			(5,702	)
Accounts payable and accrued expenses			(10,147	)			626				240				20,739
Net cash provided by (used for) operating activities			22,852				27,007				48,638				34,299
Cash Flows From Investing Activities
Capital expenditures			(6,125	)			(5,883	)			(15,216	)			(10,943	)
Acquisition of business, net of cash acquired			—				(24,253	)			(160	)			(24,253	)
Proceeds from sale of property, plant, and equipment			109				423				142				1,499
Net cash provided by (used for) investing activities			(6,016	)			(29,713	)			(15,234	)			(33,697	)
Cash Flows From Financing Activities
Net borrowings (repayments) from revolving credit facility			(9,800	)			11,500				(15,000	)			13,000
Payments on finance lease			(129	)			(125	)			(258	)			(249	)
Cash dividends paid			(5,022	)			(4,995	)			(10,296	)			(9,934	)
Proceeds from issuance of common stock			437				1,367				1,569				1,838
Shares withheld for employee taxes on equity awards			(34	)			(3	)			(2,033	)			(347	)
Net cash provided by (used for) financing activities			(14,548	)			7,744				(26,018	)			4,308
Foreign exchange rate effect on cash			163				(180	)			167				(131	)
Net increase (decrease) in cash			2,451				4,858				7,553				4,779
Beginning Cash			28,241				17,576				23,139				17,655
Ending Cash		$	30,692			$	22,434			$	30,692			$	22,434

MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) (Dollars in thousands)
		Quarter Ended June 30, 2023
		Material Handling				Distribution				Segment Total				Corporate & Other				Total
Net sales		$	143,295			$	65,173			$	208,468			$	(15	)		$	208,453
Net income																			10,605
Net income margin																			5.1	%
Gross profit																			68,410
Add: Restructuring expenses and other adjustments																			180
Adjusted gross profit																			68,590
Gross margin as adjusted																			32.9	%
Operating income (loss)			24,828				3,398				28,226				(12,084	)			16,142
Operating income margin			17.3	%			5.2	%			13.5	%		n/a					7.7	%
Add: Executive severance costs			—				410				410				289				699
Add: Restructuring expenses and other adjustments			275				—				275				—				275
Add: Acquisition and integration costs			—				111				111				—				111
Add: Environmental reserves, net(2)			—				—				—				1,800				1,800
Adjusted operating income (loss)(1)			25,103				3,919				29,022				(9,995	)			19,027
Adjusted operating income margin			17.5	%			6.0	%			13.9	%		n/a					9.1	%
Add: Depreciation and amortization			4,755				790				5,545				132				5,677
Adjusted EBITDA		$	29,858			$	4,709			$	34,567			$	(9,863	)		$	24,704
Adjusted EBITDA margin			20.8	%			7.2	%			16.6	%		n/a					11.9	%
(1) Includes gross profit adjustments of $180 and SG&A adjustments of $2,705
(2) Includes environmental charges of $1,900 net of probable insurance recoveries of $100
		Quarter Ended June 30, 2022
		Material Handling				Distribution				Segment Total				Corporate & Other				Total
Net sales		$	173,090			$	60,075			$	233,165			$	(9	)		$	233,156
Net income																			15,831
Net income margin																			6.8	%
Gross profit																			74,716
Add: Restructuring expenses and other adjustments																			—
Adjusted gross profit																			74,716
Gross margin as adjusted																			32.0	%
Operating income (loss)			28,034				4,269				32,303				(9,686	)			22,617
Operating income margin			16.2	%			7.1	%			13.9	%		n/a					9.7	%
Add: Acquisition and integration costs			—				—				—				401				401
Add: Environmental reserves, net(2)			—				—				—				600				600
Adjusted operating income (loss)(1)			28,034				4,269				32,303				(8,685	)			23,618
Adjusted operating income margin			16.2	%			7.1	%			13.9	%		n/a					10.1	%
Add: Depreciation and amortization			4,507				621				5,128				114				5,242
Adjusted EBITDA		$	32,541			$	4,890			$	37,431			$	(8,571	)		$	28,860
Adjusted EBITDA margin			18.8	%			8.1	%			16.1	%		n/a					12.4	%
(1) Includes SG&A adjustments of $1,001
(2) Includes environmental charges of $600 net of probable insurance recoveries of $0

MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) (Dollars in thousands)
		Six Months Ended June 30, 2023
		Material Handling				Distribution				Segment Total				Corporate & Other				Total
Net sales		$	295,857			$	128,358			$	424,215			$	(23	)		$	424,192
Net income																			23,581
Net income margin																			5.6	%
Gross profit																			139,475
Add: Restructuring expenses and other adjustments																			282
Adjusted gross profit																			139,757
Gross margin as adjusted																			32.9	%
Operating income (loss)			50,179				5,635				55,814				(20,715	)			35,099
Operating income margin			17.0	%			4.4	%			13.2	%		n/a					8.3	%
Add: Executive severance costs			—				410				410				289				699
Add: Restructuring expenses and other adjustments			696				179				875				10				885
Add: Acquisition and integration costs			—				220				220				126				346
Add: Environmental reserves, net(2)			—				—				—				2,300				2,300
Adjusted operating income (loss)(1)			50,875				6,444				57,319				(17,990	)			39,329
Adjusted operating income margin			17.2	%			5.0	%			13.5	%		n/a					9.3	%
Add: Depreciation and amortization			9,354				1,663				11,017				278				11,295
Adjusted EBITDA		$	60,229			$	8,107			$	68,336			$	(17,712	)		$	50,624
Adjusted EBITDA margin			20.4	%			6.3	%			16.1	%		n/a					11.9	%
(1) Includes gross profit adjustments of $282 and SG&A adjustments of $3,948
(2) Includes environmental charges of $3,500 net of probable insurance recoveries of $1,200
		Six Months Ended June 30, 2022
		Material Handling				Distribution				Segment Total				Corporate & Other				Total
Net sales		$	349,726			$	108,936			$	458,662			$	(20	)		$	458,642
Net income																			33,168
Net income margin																			7.2	%
Gross profit																			146,644
Add: Restructuring expenses and other adjustments																			390
Adjusted gross profit																			147,034
Gross margin as adjusted																			32.1	%
Operating income (loss)			59,254				7,570				66,824				(19,802	)			47,022
Operating income margin			16.9	%			6.9	%			14.6	%		n/a					10.3	%
Add: Restructuring expenses and other adjustments			390				—				390				—				390
Add: Acquisition and integration costs			—				—				—				476				476
Add: Loss on sale of assets			261				—				261				—				261
Add: Environmental reserves, net(2)			—				—				—				1,300				1,300
Adjusted operating income (loss)(1)			59,905				7,570				67,475				(18,026	)			49,449
Adjusted operating income margin			17.1	%			6.9	%			14.7	%		n/a					10.8	%
Add: Depreciation and amortization			9,023				1,179				10,202				239				10,441
Adjusted EBITDA		$	68,928			$	8,749			$	77,677			$	(17,787	)		$	59,890
Adjusted EBITDA margin			19.7	%			8.0	%			16.9	%		n/a					13.1	%
(1) Includes gross profit adjustments of $390 and SG&A adjustments of $2,037
(2) Includes environmental charges of $1,300 net of probable insurance recoveries of $0

MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES ADJUSTED OPERATING INCOME, ADJUSTED EBITDA AND FREE CASH FLOW (UNAUDITED) (Dollars in thousands, except per share data)
		Quarter Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
Adjusted operating income (loss) reconciliation:
Operating income (loss)		$	16,142			$	22,617			$	35,099			$	47,022
Executive severance costs			699				—				699				—
Restructuring expenses and other adjustments			275				—				885				390
Acquisition and integration costs			111				401				346				476
Loss on sale of assets			—				—				—				261
Environmental reserves, net			1,800				600				2,300				1,300
Adjusted operating income (loss)		$	19,027			$	23,618			$	39,329			$	49,449
Adjusted EBITDA reconciliation:
Net income (loss)		$	10,605			$	15,831			$	23,581			$	33,168
Income tax expense (benefit)			3,747				5,575				8,082				11,496
Interest expense, net			1,790				1,211				3,436				2,358
Operating income (loss)			16,142				22,617				35,099				47,022
Depreciation and amortization			5,677				5,242				11,295				10,441
Executive severance costs			699				—				699				—
Restructuring expenses and other adjustments			275				—				885				390
Acquisition and integration costs			111				401				346				476
Loss on sale of assets			—				—				—				261
Environmental reserves, net			1,800				600				2,300				1,300
Adjusted EBITDA		$	24,704			$	28,860			$	50,624			$	59,890
Free cash flow reconciliation:
Net cash provided by (used for) operating activities		$	22,852			$	27,007			$	48,638			$	34,299
Capital expenditures			(6,125	)			(5,883	)			(15,216	)			(10,943	)
Free cash flow		$	16,727			$	21,124			$	33,422			$	23,356

MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER DILUTED SHARE (UNAUDITED) (Dollars in thousands, except per share data)
		Quarter Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
Adjusted net income (loss) reconciliation:
Net income (loss)		$	10,605			$	15,831			$	23,581			$	33,168
Income tax expense (benefit)			3,747				5,575				8,082				11,496
Income (loss) before income taxes			14,352				21,406				31,663				44,664
Executive severance costs			699				—				699				—
Restructuring expenses and other adjustments			275				—				885				390
Acquisition and integration costs			111				401				346				476
Loss on sale of assets			—				—				—				261
Environmental reserves, net			1,800				600				2,300				1,300
Adjusted income (loss) before income taxes			17,237				22,407				35,893				47,091
Income tax expense, as adjusted (1)			(4,309	)			(5,826	)			(8,973	)			(12,244	)
Adjusted net income (loss)		$	12,928			$	16,581			$	26,920			$	34,847
Adjusted earnings per diluted share reconciliation:
Net income (loss) per common diluted share		$	0.29			$	0.43			$	0.64			$	0.91
Executive severance costs			0.02				—				0.02				—
Restructuring expenses and other adjustments			0.00				—				0.02				0.01
Acquisition and integration costs			0.00				0.01				0.01				0.01
Loss on sale of assets			—				—				—				0.01
Environmental reserves, net			0.05				0.02				0.06				0.04
Adjusted effective income tax rate impact			(0.01	)			(0.01	)			(0.02	)			(0.03	)
Adjusted earnings per diluted share(2)		$	0.35			$	0.45			$	0.73			$	0.95
(1) Income taxes are calculated using the normalized effective tax rate for each year. The rate used in 2023 is 25% and in 2022 is 26%.
(2) Adjusted earnings per diluted share is calculated using the weighted average common shares outstanding for the respective period.

MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES GUIDANCE FOR FULL YEAR ADJUSTED EARNINGS PER DILUTED SHARE (UNAUDITED)
	Full Year 2023 Guidance
	Low				High
GAAP diluted net income per common share	$	1.41			$	1.73
Add: Executive severance costs		0.02				0.02
Add: Net restructuring expenses and other adjustments		0.10				0.07
Add: Acquisition and integration costs		0.01				0.01
Add: Environmental reserves, net		0.06				0.06
Less: Adjusted effective income tax rate impact (1)		(0.05	)			(0.04	)
Adjusted earnings per diluted share (2)	$	1.55			$	1.85
(1) Income taxes are calculated using the normalized effective tax rate for each year. The rate used in 2023 is 25%.
(2) Adjusted earnings per diluted share is calculated using the weighted average common shares outstanding.

 

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Rich Pasela, Manager, Investor Relations and Treasury, 330-761-6284

Source: Myers Industries, Inc.