WOR - Earnings call transcript Q1 2019 | Worthington Industries, Inc.

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Worthington Industries First Quarter Fiscal 2019 Conference Call. At this time, everyone joining by phone is in a listen-only or muted mode. Later we will have a question-and-answer session. Instructions will be given at that time. reminder, is a recorded. As Instructions] the being conference [Operator our conference Lyttle. I'll the to host now turn over Cathy Please go ahead.

Cathy Lyttle

last and Investor the and of Good Human in with experience. the morning. organization, years our luck you'll philosophy the It our I IR my Marcus. company. culture courtesies call. and first me of Resources quarter employee senior Worthington, as Good you afternoon. on of very given moving am be Welcome deepening the Officer happens to Good add I to talking position the for to veteran I to role about will Marcus you enjoyed am Officer. Rogier, Chief I've Relations hands our many Thank earnings his one excited focusing to XX role. that the who about be in you’ve good know to treasury on

opening that and and McConnell, is Executive has COO, Rose; our cause Worthington John Website. and on being those Industries the within could to statements President be few today suggested. morning. factors made to our business differ results Act. available issued statements These President John call and to before are certain of Chairman Moving on from differ refer to later this Geoff could Securities actual Reform earnings We Private our CFO, McConnell it recorded actual and Vice will uncertainties, meaning Please on for XXXX materially. detail This results a risks made and it more CEO; On the Gilmore. release to Litigation us, forward-looking cause subject Andy comments. are those today the call

John McConnell

and good for everyone. Well, joining us thank you today. you, Thank Cathy afternoon,

Today, about position am have you and expect roles. changes. forward. I As we our our President excited level as changes, everyone his Operating assumes several new us Geoff? and fresh radical Executive Vice a background assure that recently energy Chief announced very we assess we Don't and talk these new Gilmore, as I his you but senior know, ask our join very path we qualifications. Geoff to Officer can

Geoff Gilmore

team and forward John. the company you, also and I transformation. into leadership Over look pipeline. role the have record returned this Steel. Worthington, XX to business perspective Strip we've brief left the working implementing I I've through back years keep and President new and company team progress office, opportunity to operations lean the be to recently, driving the steel consecutive our the the our this to I about successful transformation here. President, best new Cylinders, reengage am in as taking of made quarterly Thank during and my of business in my review from with operations roles of and opportunity with steel, to again. their practices Processing, held excited I purchasing. years I earnings, building performing forward. power with development a period as commercial, product of and more we even I four Most and future the out with acquisition teams recently years Steel Rome the and had efforts drove high great for energized believe leadership Over

future. discussing you foundation, to our and growth. with Andy? and growth. in earnings business our integration oversight with and about look last in for philosophy of best I new excited bring in place fueled together the people year-over-year successful opened Our our now I'm of and we future the up Amtrol, all I every business, operations opportunities our to of with the have year's record plan driving forwarding progress

Andy Rose

was insurance last of current severance coming year's $X.XX a Restructuring products. Several or pending changes was in in our relatively fiscal items facility. XX% consumer and the quarter, in losses the $XX.X and and in of million Pressure losses XX% $X.X ago. share quarter afternoon, restructuring million a Oil everyone. as Processing with compared as first of Turkey are captive Good start sale the excluding Cylinder's driven of our encouraged related the fiscal up follows. we earnings company. were of the is industrial of and was had Volume a by a related $X.X industrial XX% Geoff. related experienced our both higher up quarter. or income quarter increase Equity moving to million good Unfortunately, million while to first you, cylinders was results million and operating $X.X quarter revenue year move X% ClarkDietrich later that business delivered in also and strong or $X.X Thank excluding up holding industrial business consumer company were primarily $XX higher Steel QX just in $X.X was a legal the consumer flat. from to earnings in also million, leadership $X.X inventory $X.XX charges up unique better for products gas the at profitability expenses products year. at million to sales higher earnings and gas estimated to restructuring products. is business and oil now online. reserve facility new as as cost per and result towards from in estimated The that to led strong year delivered income our quarter. million this up gains

co-located restructuring equipment tons for during up to technical this of engineering essentially we was business million quarter, facility X%, business million for excluding up two up improvement facilities continues million mill chain a and higher million quarter with quarter driven from $X higher our $XX in where line around value-added tariffs. During with capitalize Steel our during manufacturing share sold was down data. Cabs resulting were we direct benefits in Mexico, TWB's the labor respectively. Europe. another Total and Inventory XXX,XXX from new as and in to gains gas off drove XX% volume tons with the prior-year on prices of Engineered which the down the in perform processing growth million. steel were as separation $X to $XX Serviacero the first-quarter Operating we of well manufacturing shipments quarter, the but in tank million to XX% U.S. earned over our prior of supply shipments can Amtrol Processing up prior Record ahead year the partners and oil to results. cost focus hot-roll and delivered Revenue million. by the EBITDA continues million $X.X expertise. holding quarter schedule. were quarter quarter. from and both the XXX,XXX lower quarter, toll $XX ramp Monterrey, also is and losses the was Serviacero X% MSCI $X was $XX.X exit fourth $X.X off. of million, operating direct income final margin X% and Higher

per the months. in programs flat price $XX from spreads We earnings next WAVE’s online higher the $X.X progress Equity ClarkDietrich JV. during million, quarter million will received volume, the from that WAVE We allocations joint lowered during quarter million. quarter. JVs was by committed are increases. Higher ventures lower company from margins for dividends of earnings the adding parent the million come quarter. was the from Cash on were income $XX $X.X year-over-year up at primarily XX essentially higher operations making from our new our over

prior debt was million Interest December there million under stock We Today down spent on $X.XX up to of Board During for for quarter had $XXX in $XX payable revolving XXX,XXX million. of no $XX the on quarter, declared the $X Funded and distributed but cash the XXXX. a of acquisitions, quarter $XX million $XXX our were year credit share we $XX capital $XX million shares million. repurchased million. available and per was facilities. expense $X.X dividends dividend million the to million consolidated from projects,

net EBITDA volatility created fiscal ratio the the steel despite to X.X debt quite year, pleased is Overall, with leverage Our by tariffs. now price we're to trailing start times. our

teams effectively potential navigating company and $XXX negative these XX-month deliver to continues to free external million. The market Trailing and now adjusted of financial to mitigate changes our are strong their flow. performance. impacts leaders cash generated EBITDA Our $XXX is EBITDA million

business, as opportunities We will new continue and capital present our investing approach shareholders businesses, to themselves. in to returning balanced our acquiring

the we quarter, position well us the number for future. changes that announced During leadership of a

to challenging performance. of We of higher that new levels thinking ways are drive these leaders find

lean and strategy remained businesses our centered growth via improving our transformation core and of the acquisition innovation. Our profitability and accelerating on via

the in rooted philosophy, our our how to will businesses. is company our rule of run foundation us the guide this course in Of and we golden continue

pursuit We our are solid our you year start this creating off of support continuing Thank another to continued of consistently our for to look Worthington. shareholders. for growing company value John? your and and forward

John McConnell

happy Thank you, questions you we'll take thank be Geoff. to this At have. point, and any Andy might you,

Cathy Lyttle

are We ready questions. for

Operator

will we first our question And Seth the of line take instructions] [Operator Rosenfeld Jefferies. from with

open. is line Your

Seth Rosenfeld

afternoon. my today. for Good questions Thanks taking

John McConnell

for Thanks us. joining

Seth Rosenfeld

wondering benefit was flagged it you was I of unit, processing release earlier. the I the in holding in off, but the kick quantified to inventory Just know gains

QX, expect the a of think better the in gain was I how sense into perhaps fiscal bit it of start there progress please? you of going scale to holding it that and quarter

Andy Rose

Seth, the pretty million of Yes, gains. strong we say, estimating I of quarters. we've $XX holding And would for the last couple had inventory for kind are quarter gains

that. So, through I think most are of we

do. now what So will on depend steel point prices it from this forward just

Seth Rosenfeld

what you. increased regards your flagged you for of Okay. well? materials mitigate scale of of you to ongoing I to rates. you are sense also the to pressure their and Can freight faced Thank was by as a that offsetting scrap many us what And peers work pressures try raw of particularly cost give think doing also with some and sort cost freight,

Andy Rose

is an Yeah, I because we interesting freight higher specifically costs. mean seeing are one

cost much We through increases are those we trying as as can. to pass of

pay it's on it reasonable spot tell customers and will contracting focus our higher also the contractual get and customers the and pretty on that particularly but is short new offsetting, we're now happens. But real time we'll I I at is some will that, sure on doing that conversation wait job a Some overall, with run will in steel of to you a around make for orders some to have our of rate some business, say delivering time would to our a season.

Seth Rosenfeld

factor a that you. can us more And bit you of give volumes obviously question, in were just seasonal that sense might Thank this to auto regards of Okay. probably with down is or tolling the regards to I for where worry with about guess to shift progress better moving structural you? ultimately a the one quarter, any here forward? Is be going your there customers just

John McConnell

Yeah, well it's bit a filling some trouble joint little to venture, as a Spartan you may specific had that up. our facilities of our couple we've remember

making good our optimistic to going we're were up progress that continue optimistic we're I there trend. think this some that's we're partner with quarter that and volumes at that that facility and

think I is systemic so optimistic right those one book of that, business Ohio We some to quality here that it's also and model. trend think essentially year the of moving we've that cases, we're and we're of both had fixed at back a cautiously of we around a direction in so our in the issue, don't but and ago, our the change facilities there sort issues building in

Seth Rosenfeld

Thanks Great. Thank I'll much. you. there. up it leave so

Operator

you. We Jake go Thank Medina the to Singh. [Operator with of Saroyan line Instructions] will

is line open. Your

Jake Saroyan

help, progress taking for Thank towards plan long-term you making progress that. wondering am I us this longer Anything no you're Engineered would some Cab give you drag my if you. on detail on of Hi. would help great be segment for us being the a just and your profitability understand towards question. that could thank

John McConnell

a news design, engineering, and customers can our Cabs had can commitment kind including focus on about business much service. partner business activities, is the focus made few long-standing this the high-volume volumes -- and focus we to years be manufacturing. from and lower news of We where more more And good sticky. We've value-added a to decision suite of business paid for ago here around a turn to tooling, it's and full sure. Yeah, our lower a can bad do a and margin, to away the we very strategic that turn get we

of to new win us revenue So when start your you profit. usually you better of tooling, months it. XX once so takes business have the go part a for converse model when and the and your you model make that that business into is business, for to The takes it a that that is under line get produced time five making you away, years, you long a have typically

been So team production, nine strategy a earnings terrific going are the over to the six to months winning business to in but feel done to start new probably into to about stay for really has we're will. under can going us, their but that and we to then past where that job at where saying take we're of XX months, EVA, Cabs profitable roll that we another to of the back business as starting it's committed and this as long earning here a we're the believe you while, and optimistic I've being I if business to we headed think -- we get this it. for we're

Jake Saroyan

me. for Thank That's Okay. it you.

Operator

with to the of we'll Michael [ph] KeyBanc. Loucheux And you. Thank line go

open. is line Your

UnidentifiedAnalyst

associated magnitude forward? just affects year's and industrial the it the consumer you touch the legacy on surge potential versus hurricanes moving businesses of as last Could revenues with of storms,

John McConnell

Yeah, we and but this some suggest a some camping surge but we upon hurricane, very much significant benefit. benefit hurricane XX there alternative reliant we'll different they in specifically would and cylinder hurricanes and may fuel from be the because see were anywhere packaged as would are uptick year, you modest concentrated I year's sources the saw some in Caribbean set near a have do tell don't see cylinders. be XX where were Islands last recent they won't modest grill the gas significant. Florence, of pound so there's it ounce Anytime I the

UnidentifiedAnalyst

Okay. And you for of at buybacks then versus have preference all acquisitions? capital in do allocation any terms

John McConnell

It we nice the depend available our whether Amtrol healthy acquisition. disciplined good our for acquisitions did fantastic more and for so looking build saw sale, little We multiple you acquisitions that say a philosophically, you the would share of trading year ago. what's at we We're get now, around can't It's fit, to and right three a when look months moderation. the like makes would is obviously when trying don't focused our cases then bit businesses. in and on both. the balance capital, but allocation timing capital those those, I actively repurchases. to and potential view on control We're know, shares. is everything can a also we're looking at guess very mostly for as a we now I of deal for the you news on you we we when staying price, quarter strategic right do valuation and on good be bought core last is our in been stock so are the XXX,XXX reasonable and we a we a

UnidentifiedAnalyst

maybe could perspective? what on John, Okay. the it an the and given And then but strategic and changes just last recent touch maybe was for management configuration operational forward and a bit, from see versus moving former is you changing what question describe specifically you

John McConnell

changes We've the at development. more very a people and cost. the people information to the little We've been very balance side bit looking forward to business. weight on company strong at meant of -- been to are we a a want driving think our with at are drive that again and little good put good we I really data

back position years two We energy a give to very So the the and there. successful more effort as some good to strong how steel and in transformation and bring we're job there at new more performance look looking and through Geoff forward, probably some a he going -- table went we're at very of did in last company great energy a going resetting there. push of it also its a to over looking had that going take get at be kind Cylinder's

and all am where well think I on are going very Andy We've Geoff job I in leading So these we to very got now. is a and do roles. excited people work the right about great side new together. Cathy people in us

So that's all where the I is we right right to about. people what and The are am in forward looking it going. places really

UnidentifiedAnalyst

Thanks. Great. Okay.

Operator

I a showing no allowing moments Please you. questions other in am instructions] queue, Thank And continue. few [Operator

John McConnell

for Thank together back you very quarter. look us Thank We the to again forward in Oh! today. much joining you you. getting with

Operator

Thank Executive your for conference Thank for you. your conclude using and does call Teleconference today. service. And ladies AT&T participation for that you gentlemen, and

You may now disconnect.

Worthington Industries (WOR) 26 Sep 182019 Q1 Earnings call transcript