May 19, 2023
Via EDGAR
Attention: Tracey Houser
U.S. Securities & Exchange Commission
Division of Corporation Finance
100 F Street, N.E.
Washington, D.C. 20549
Re: Myers Industries, Inc.
Form 10-K for Fiscal Year Ended December 31, 2022
Filed March 3, 2023
Form 8-K Filed May 4, 2023
Response Letter Dated May 4, 2023
File No. 001-08524
Dear Ms. Houser,
Set forth below is the response from Myers Industries, Inc. (the “Company”) to an additional comment from the staff (the “Staff”) of the Division of Corporation Finance of the U.S. Securities and Exchange Commission (the “Commission”), dated May 17, 2023 (the “Comment Letter”), in connection with the Staff's review of our prior correspondence filed with the Commission on May 4, 2023, concerning the Staff's review of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and Form 8-K filed May 4, 2023.
For convenience of the Staff’s review, we have set forth below in bold type the additional comment of the Staff in the Comment Letter, with the Company’s response thereto immediately following the Staff's comment.
Form 8-K filed May 4, 2023
Exhibit 99.1
1.
We note your presentation of Adjusted EBITDA margin at the consolidated level without also presenting the most directly comparable US GAAP measure, or net income margin. As previously requested in comment 1, please expand your presentation of your non-GAAP measures to include a presentation, with equal or greater prominence, of the most directly comparable US GAAP measure as required by Item 10(e)(1)(i)(a) of Regulation S-K. Refer to the second and third bullets of Question 102.10(a) of the Compliance and Disclosure Interpretations on Non-GAAP Financial Measures for additional guidance.
Response: We acknowledge the Staff’s comment. In future filings, we will expand our disclosure to present net income margin with equal or greater prominence to consolidated Adjusted EBITDA margin. Below is an excerpt from Exhibit 99.1 of our Form 8-K filed on May 4, 2023 supplemented with the highlighted expanded disclosure to illustrate how we plan to address the Staff's comment in future filings.
|
| Quarter Ended March 31, 2023 |
| |||||||||||||||||
|
| Material Handling |
|
| Distribution |
|
| Segment Total |
|
| Corporate & Other |
|
| Total |
| |||||
Net sales |
| $ | 152,562 |
|
| $ | 63,185 |
|
| $ | 215,747 |
|
| $ | (8 | ) |
| $ | 215,739 |
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 12,976 |
| ||||
Net income margin |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 6.0 | % | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Gross profit |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 71,065 |
| ||||
Add: Restructuring expenses and other adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 102 |
| ||||
Adjusted gross profit |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 71,167 |
| ||||
Gross margin as adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 33.0 | % | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Operating income (loss) |
|
| 25,351 |
|
|
| 2,237 |
|
|
| 27,588 |
|
|
| (8,631 | ) |
|
| 18,957 |
|
Operating income margin |
|
| 16.6 | % |
|
| 3.5 | % |
|
| 12.8 | % |
| n/a |
|
|
| 8.8 | % | |
Add: Acquisition and integration costs |
|
| — |
|
|
| 109 |
|
|
| 109 |
|
|
| 126 |
|
|
| 235 |
|
Add: Restructuring expenses and other adjustments |
|
| 421 |
|
|
| 179 |
|
|
| 600 |
|
|
| 10 |
|
|
| 610 |
|
Add: Environmental reserves, net(2) |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 500 |
|
|
| 500 |
|
Adjusted operating income (loss)(1) |
|
| 25,772 |
|
|
| 2,525 |
|
|
| 28,297 |
|
|
| (7,995 | ) |
|
| 20,302 |
|
Adjusted operating income margin |
|
| 16.9 | % |
|
| 4.0 | % |
|
| 13.1 | % |
| n/a |
|
|
| 9.4 | % | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Add: Depreciation and amortization |
|
| 4,599 |
|
|
| 873 |
|
|
| 5,472 |
|
|
| 146 |
|
|
| 5,618 |
|
Adjusted EBITDA |
| $ | 30,371 |
|
| $ | 3,398 |
|
| $ | 33,769 |
|
| $ | (7,849 | ) |
| $ | 25,920 |
|
Adjusted EBITDA margin |
|
| 19.9 | % |
|
| 5.4 | % |
|
| 15.7 | % |
| n/a |
|
|
| 12.0 | % | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
(1) Includes gross profit adjustments of $102 and SG&A adjustments of $1,243 |
| |||||||||||||||||||
(2) Includes environmental charges of $1,600 net of probable insurance recoveries of $1,100 |
| |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
|
| Quarter Ended March 31, 2022 |
| |||||||||||||||||
|
| Material Handling |
|
| Distribution |
|
| Segment Total |
|
| Corporate & Other |
|
| Total |
| |||||
Net sales |
| $ | 176,636 |
|
| $ | 48,861 |
|
| $ | 225,497 |
|
| $ | (11 | ) |
| $ | 225,486 |
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 17,337 |
| ||||
Net income margin |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 7.7 | % | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Gross profit |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 71,928 |
| ||||
Add: Restructuring expenses and other adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 390 |
| ||||
Adjusted gross profit |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 72,318 |
| ||||
Gross margin as adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
|
| 32.1 | % | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Operating income (loss) |
|
| 31,220 |
|
|
| 3,301 |
|
|
| 34,521 |
|
|
| (10,116 | ) |
|
| 24,405 |
|
Operating income margin |
|
| 17.7 | % |
|
| 6.8 | % |
|
| 15.3 | % |
| n/a |
|
|
| 10.8 | % | |
Add: Acquisition and integration costs |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 75 |
|
|
| 75 |
|
Add: Restructuring expenses and other adjustments |
|
| 390 |
|
|
| — |
|
|
| 390 |
|
|
| — |
|
|
| 390 |
|
Add: Loss on sale of assets |
|
| 261 |
|
|
| — |
|
|
| 261 |
|
|
| — |
|
|
| 261 |
|
Add: Environmental charges |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 700 |
|
|
| 700 |
|
Adjusted operating income (loss)(1) |
|
| 31,871 |
|
|
| 3,301 |
|
|
| 35,172 |
|
|
| (9,341 | ) |
|
| 25,831 |
|
Adjusted operating income margin |
|
| 18.0 | % |
|
| 6.8 | % |
|
| 15.6 | % |
| n/a |
|
|
| 11.5 | % | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Add: Depreciation and amortization |
|
| 4,516 |
|
|
| 558 |
|
|
| 5,074 |
|
|
| 126 |
|
|
| 5,200 |
|
Adjusted EBITDA |
| $ | 36,387 |
|
| $ | 3,859 |
|
| $ | 40,246 |
|
| $ | (9,215 | ) |
| $ | 31,031 |
|
Adjusted EBITDA margin |
|
| 20.6 | % |
|
| 7.9 | % |
|
| 17.8 | % |
| n/a |
|
|
| 13.8 | % | |
|
| |||||||||||||||||||
(1) Includes gross profit adjustments of $390 and SG&A adjustments of $1,036 |
| |||||||||||||||||||
If you have any questions with respect to the foregoing or require further information, please contact the undersigned at (330) 761-6130.
Sincerely, |
|
/s/ Grant E. Fitz |
Grant E. Fitz |
Executive Vice President and Chief Financial Officer |