Company Announcements

Valmont Reports Third Quarter 2024 Results

Net Sales and Operating Income Aligned with Expectations
Generated Strong Operating Cash Flows of $225 Million

OMAHA, Neb.--(BUSINESS WIRE)--Oct. 22, 2024-- Valmont®Industries, Inc. (NYSE: VMI), a global leader that provides vital infrastructure and advances agricultural productivity while driving innovation through technology, today reported financial results for the third quarter ended September 28, 2024.

President and Chief Executive Officer Avner M. Applbaum commented, “Our team delivered another solid quarter, expanding operating margins and generating strong operating cash flows despite lower sales. The Infrastructure segment benefited from strong utility market demand and an improving telecommunications market in North America. Pricing discipline, a more favorable product mix, and a leaner cost structure contributed to margin improvement. In Agriculture, while North American and Brazilian markets remain muted, I’m proud of our swift response in supplying replacement equipment to support our dealers following the Midwest U.S. storms earlier this year. I want to thank the Valmont team for their hard work and execution in delivering higher operating margins and cash flows. Overall, I’m pleased with our continued progress towards our strategic priorities and creating long-term value for our stakeholders.”

Third Quarter 2024 Highlights (all metrics compared to Third Quarter 2023 unless otherwise noted)

  • Net sales of $1.0 billion decreased 2.9%, as strong growth in Transmission, Distribution, and Substation (“Utility”) and Telecommunications was offset by lower sales in Solar and international Agriculture, specifically Brazil
  • Operating income increased to $125.7 million or 12.3% of net sales compared to an operating loss of ($24.2) million [adjusted1 operating income of $120.8 million or 11.5% of net sales]
  • Diluted earnings per share (“EPS”) of $4.11 compared to diluted loss per share of ($2.34) [$4.12 EPS adjusted1]
  • Generated operating cash flows of $225.1 million; cash and cash equivalents at the end of the third quarter were $200.5 million
  • Returned $52.2 million to shareholders through share repurchases and dividends
  • Reduced revolving credit facility borrowings by approximately $120.0 million
  • Reaffirming 2024 full-year financial outlook

Key Financial Metrics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2024

GAAP

 

Adjusted1

(In thousands, except per-share amounts)

9/28/2024

 

9/30/2023

 

 

9/28/2024

 

9/30/2023

 

 

 

Q3 2024

 

Q3 2023

vs. Q3 2023

 

Q3 2024

 

Q3 2023

 

vs. Q3 2023

Net Sales

$

1,020,175

 

$

1,050,295

 

(2.9

)%

 

$

1,020,175

 

$

1,050,295

 

(2.9

)%

Gross Profit

 

301,693

 

 

315,111

 

(4.3

)%

 

 

301,693

 

 

315,111

 

(4.3

)%

Gross Profit as a % of Net Sales

 

29.6

%

 

30.0

%

 

 

 

29.6

%

 

30.0

%

 

Operating Income (Loss)

 

125,735

 

 

(24,190

)

NM

 

 

 

125,735

 

 

120,834

 

4.1

%

Operating Inc. (Loss) as a % of Net Sales

 

12.3

%

 

(2.3

)%

 

 

 

12.3

%

 

11.5

%

 

Net Earnings (Loss) Attrib. to VMI

 

83,068

 

 

(49,028

)

NM

 

 

 

83,068

 

 

86,976

 

(4.5

)%

Diluted Earnings (Loss) per Share

 

4.11

 

 

(2.34

)

NM

 

 

 

4.11

 

 

4.12

 

(0.2

)%

Weighted Average Shares Outstanding

 

20,234

 

 

20,951

 

 

 

 

20,234

 

 

21,131

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year-to-Date 2024

GAAP

 

Adjusted1

(In thousands, except per-share amounts)

9/28/2024

 

9/30/2023

 

 

9/28/2024

 

9/30/2023

 

 

 

FY 2024

 

FY 2023

vs. FY 2023

 

FY 2024

 

FY 2023

 

vs. FY 2023

Net Sales

$

3,037,740

 

$

3,159,072

 

(3.8

)%

 

$

3,037,740

 

$

3,159,072

 

(3.8

)%

Gross Profit

 

928,191

 

 

953,093

 

(2.6

)%

 

 

928,191

 

 

953,093

 

(2.6

)%

Gross Profit as a % of Net Sales

 

30.6

%

 

30.2

%

 

 

 

30.6

%

 

30.2

%

 

Operating Income

 

404,596

 

 

228,009

 

NM

 

 

 

404,596

 

 

380,601

 

6.3

%

Operating Income as a % of Net Sales

 

13.3

%

 

7.2

%

 

 

 

13.3

%

 

12.0

%

 

Net Earnings Attributable to VMI2

 

270,606

 

 

114,888

 

NM

 

 

 

270,606

 

 

257,368

 

5.1

%

Diluted Earnings per Share2

 

13.34

 

 

5.40

 

NM

 

 

 

13.34

 

 

12.09

 

10.3

%

Weighted Average Shares Outstanding

 

20,283

 

 

21,290

 

 

 

 

20,283

 

 

21,290

 

 

 

2Q2 2024 included a tax benefit of approximately $3.0 million or $0.15 per share due to the reduction of a valuation allowance on a tax loss carryforward in a foreign subsidiary 

NM = not meaningful

Third Quarter 2024 Segment Review

Infrastructure (74.1% of Net Sales)

Products and solutions to serve the infrastructure markets of utility, solar, lighting and transportation, and telecommunications, along with coatings services to protect metal products

Sales of $758.6 million increased slightly year over year. Strong sales growth in Utility and Telecommunications was offset by lower Lighting and Transportation (“L&T”) and Solar sales.

Utility sales grew nearly 15.0%, primarily due to a favorable project mix and higher volumes of distribution and substation products. Telecommunications volumes were higher, driven by increased carrier spending amid a stabilizing North American market environment. Lower L&T volumes were driven by lighting market softness, the strategic exit from select lower-margin products, and transportation project timing. Solar volumes were significantly lower due to the non-recurrence of a large international utility-scale project in the third quarter 2023, and last quarter’s strategic decision to exit certain low-margin projects.

Pricing improved across the segment, as a favorable mix and pricing discipline more than offset the impact of steel index deflation.

Operating income increased to $123.7 million or 16.3% of net sales compared to $103.4 million or 13.7% of net sales [adjusted1 operating income of $108.0 million or 14.3% of net sales] in the third quarter of 2023. This improvement was driven by pricing discipline, lower SG&A expenses, and a reduction in cost of goods sold, primarily due to lower steel costs.

Agriculture (25.9% of Net Sales)

Center pivot and linear irrigation equipment components for agricultural markets, including aftermarket parts and tubular products, and advanced technology solutions for precision agriculture

Sales of $265.3 million decreased 11.1% year over year. In North America, irrigation equipment volumes were slightly lower. An increase in replacement sales driven by severe weather events earlier in 2024 was offset by continued agriculture market softness amid lower grain prices. Average irrigation selling prices were similar to last year.

International sales decreased year over year, with significantly lower sales in Brazil due to normalizing backlog levels and lower grain prices, which impacted growers’ buying behavior. This decline was partially offset by sales growth in the Europe, Middle East, and Africa (“EMEA”) region and the contribution from the HR Products acquisition.

Operating income was $28.9 million or 11.0% of net sales compared to an operating loss of ($99.7) million [adjusted1 operating income of $38.5 million or 13.0% of net sales] in the third quarter of 2023. The benefit of reduced SG&A expenses was offset by the impact of lower volumes and a higher mix of project sales.

Balance Sheet, Liquidity, and Capital Allocation

The Company generated strong operating cash flows of $225.1 million. Cash and cash equivalents at the end of the third quarter were $200.5 million. Valmont paid $12.1 million in dividends and repurchased $40.1 million of Company stock, with $81.0 million remaining on the authorized share repurchase program. Additionally, the Company reduced borrowings on its revolving credit facility by approximately $120.0 million this quarter, bringing the total year-to-date net reduction to approximately $210.0 million.

Reaffirming 2024 Full-Year Financial Outlook and Providing Key Assumptions

The Company is reaffirming its full-year 2024 net sales and diluted earnings per share outlook that was provided in the second quarter.

  • Net sales change (vs. prior year) of (3.5%) to (1.5%)
    • Infrastructure net sales growth of Flat to 1.5% vs. prior year
    • Agriculture net sales expected to decrease (15.0%) to (10.0%) vs. prior year
  • Diluted earnings per share of $16.50 to $17.30
  • Effective tax rate expected to be slightly below 26%
  • Minimal expected foreign currency translation impact on net sales
  • For cash flow purposes, capital expenditures now expected to be in the range of $85.0 to $95.0 million to support strategic growth initiatives (vs. prior expectation of $95.0 to $110.0 million)

Mr. Applbaum added, “We’ve performed well during the first three quarters of the year, reinforcing our confidence in achieving our full-year outlook. Our diverse exposure to infrastructure and agriculture markets helps us navigate market cycles effectively, and our focus on operational excellence and growth investments positions us to meet rising demand. In addition, we remain disciplined in driving margin expansion through pricing and expense management. Combined with a balanced capital allocation framework, this positions us to deliver lasting and meaningful shareholder returns.”

A live audio discussion with Avner M. Applbaum, President and Chief Executive Officer, and Thomas Liguori, Executive Vice President and Chief Financial Officer, will be accessible by telephone on Wednesday, October 23, 2024 at 8:00 a.m. CT by dialing +1 877.407.6184 or +1 201.389.0877 (no Conference ID needed), or via webcast by pointing browsers to this link: Valmont Industries 3Q 2024 Earnings Conference Call. A slide presentation will simultaneously be available for download on the Investors page of valmont.com. A replay of the event can be accessed three hours after the call at the above link or by telephone at +1 877.660.6853 or +1 201.612.7415. Please use access code 13742907. The replay will be available through 10:59 p.m. CT on Wednesday, October 30, 2024.

About Valmont Industries, Inc.

For nearly 80 years, Valmont has been a global leader in creating vital infrastructure and advancing agricultural productivity. Today, we remain committed to doing more with less by innovating through technology. Learn more about how we’re Conserving Resources. Improving Life.® at valmont.com.

Concerning Forward-Looking Statements

This release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on assumptions that management has made in light of experience in the industries in which Valmont operates, as well as management’s perceptions of historical trends, current conditions, expected future developments, and other factors believed to be appropriate under the circumstances. As you read and consider this release, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties (some of which are beyond Valmont’s control), and assumptions. Although management believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect Valmont’s actual financial results and cause them to differ materially from those anticipated in the forward-looking statements. These factors include, among other things, risk factors described from time to time in Valmont’s reports to the Securities and Exchange Commission, as well as future economic and market circumstances, industry conditions, company performance and financial results, operating efficiencies, availability and price of raw materials, availability and market acceptance of new products, product pricing, domestic and international competitive environments, geopolitical risks, and actions and policy changes of domestic and foreign governments. The Company cautions that any forward-looking statement included in this press release is made as of the date of this press release and the Company does not undertake to update any forward-looking statement.

Website and Social Media Disclosure

The Company uses its website and social media channels identified on its website as channels of distribution of Company information. The information that the Company posts through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following the Company’s press releases, Securities and Exchange Commission filings, and public conference calls and webcasts. The contents of the Company’s website and social media channels are not part of this press release.

1Please see Reg G reconciliation to GAAP measures at end of document

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars and shares in thousands, except per-share amounts)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirteen weeks ended

 

Thirty-nine weeks ended

 

 

September 28,

 

September 30,

 

September 28,

 

September 30,

 

 

2024

 

2023

 

2024

 

2023

Net sales

 

$

1,020,175

 

 

$

1,050,295

 

 

$

3,037,740

 

 

$

3,159,072

 

Cost of sales

 

 

718,482

 

 

 

735,184

 

 

 

2,109,549

 

 

 

2,205,979

 

Gross profit

 

 

301,693

 

 

 

315,111

 

 

 

928,191

 

 

 

953,093

 

Selling, general, and administrative expenses

 

 

175,958

 

 

 

194,277

 

 

 

523,595

 

 

 

580,060

 

Impairment of goodwill and other intangible assets

 

 

 

 

 

140,844

 

 

 

 

 

 

140,844

 

Realignment charges

 

 

 

 

 

4,180

 

 

 

 

 

 

4,180

 

Operating income (loss)

 

 

125,735

 

 

 

(24,190

)

 

 

404,596

 

 

 

228,009

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(14,313

)

 

 

(13,472

)

 

 

(46,380

)

 

 

(41,494

)

Interest income

 

 

2,080

 

 

 

3,186

 

 

 

5,358

 

 

 

4,579

 

Gain (loss) on deferred compensation investments

 

 

1,160

 

 

 

(344

)

 

 

3,116

 

 

 

1,791

 

Gain on divestiture

 

 

 

 

 

 

 

 

 

 

 

2,994

 

Other

 

 

(2,307

)

 

 

165

 

 

 

(3,662

)

 

 

(4,593

)

Total other income (expenses)

 

 

(13,380

)

 

 

(10,465

)

 

 

(41,568

)

 

 

(36,723

)

Earnings (loss) before income taxes and equity in loss of nonconsolidated subsidiaries

 

 

112,355

 

 

 

(34,655

)

 

 

363,028

 

 

 

191,286

 

Income tax expense

 

 

29,724

 

 

 

15,461

 

 

 

90,779

 

 

 

79,239

 

Equity in loss of nonconsolidated subsidiaries

 

 

(21

)

 

 

(199

)

 

 

(60

)

 

 

(1,219

)

Net earnings (loss)

 

 

82,610

 

 

 

(50,315

)

 

 

272,189

 

 

 

110,828

 

Loss (earnings) attributable to redeemable noncontrolling interests

 

 

458

 

 

 

1,287

 

 

 

(1,583

)

 

 

4,060

 

Net earnings (loss) attributable to Valmont Industries, Inc.

 

$

83,068

 

 

$

(49,028

)

 

$

270,606

 

 

$

114,888

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - Basic

 

 

20,092

 

 

 

20,951

 

 

 

20,152

 

 

 

21,083

 

Earnings (loss) per share - Basic

 

$

4.13

 

 

$

(2.34

)

 

$

13.43

 

 

$

5.45

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - Diluted

 

 

20,234

 

 

 

20,951

 

 

 

20,283

 

 

 

21,290

 

Earnings (loss) per share - Diluted

 

$

4.11

 

 

$

(2.34

)

 

$

13.34

 

 

$

5.40

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends per share

 

$

0.60

 

 

$

0.60

 

 

$

1.80

 

 

$

1.80

 

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

SUMMARY OPERATING RESULTS

(Dollars in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirteen weeks ended

 

Thirty-nine weeks ended

 

 

September 28,

 

September 30,

 

September 28,

 

September 30,

 

 

2024

 

2023

 

2024

 

2023

Infrastructure

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

756,370

 

 

$

753,626

 

 

$

2,237,533

 

 

$

2,253,924

 

Gross profit

 

 

223,333

 

 

 

214,841

 

 

 

673,353

 

 

 

640,113

 

as a percentage of net sales

 

 

29.5

%

 

 

28.5

%

 

 

30.1

%

 

 

28.4

%

Selling, general, and administrative expenses

 

 

99,676

 

 

 

106,800

 

 

 

298,251

 

 

 

321,770

 

as a percentage of net sales

 

 

13.2

%

 

 

14.2

%

 

 

13.3

%

 

 

14.3

%

Impairment of goodwill and other intangible assets

 

 

 

 

 

3,571

 

 

 

 

 

 

3,571

 

Realignment charges

 

 

 

 

 

1,069

 

 

 

 

 

 

1,069

 

Operating income

 

 

123,657

 

 

 

103,401

 

 

 

375,102

 

 

 

313,703

 

as a percentage of net sales

 

 

16.3

%

 

 

13.7

%

 

 

16.8

%

 

 

13.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Agriculture

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

263,805

 

 

$

296,669

 

 

$

800,207

 

 

$

905,148

 

Gross profit

 

 

78,360

 

 

 

100,270

 

 

 

254,838

 

 

 

312,980

 

as a percentage of net sales

 

 

29.7

%

 

 

33.8

%

 

 

31.8

%

 

 

34.6

%

Selling, general, and administrative expenses

 

 

49,467

 

 

 

61,760

 

 

 

145,001

 

 

 

171,896

 

as a percentage of net sales

 

 

18.8

%

 

 

20.8

%

 

 

18.1

%

 

 

19.0

%

Impairment of goodwill and other intangible assets

 

 

 

 

 

137,273

 

 

 

 

 

 

137,273

 

Realignment charges

 

 

 

 

 

907

 

 

 

 

 

 

907

 

Operating income (loss)

 

 

28,893

 

 

 

(99,670

)

 

 

109,837

 

 

 

2,904

 

as a percentage of net sales

 

 

11.0

%

 

 

(33.6

)%

 

 

13.7

%

 

 

0.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general, and administrative expenses

 

$

26,815

$

25,717

$

80,343

$

86,394

Realignment charges

 

 

 

 

 

2,204

 

 

 

 

 

 

2,204

 

Operating loss

 

 

(26,815

)

 

 

(27,921

)

 

 

(80,343

)

 

 

(88,598

)

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

SUMMARY OPERATING RESULTS

(Dollars in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirteen weeks ended September 28, 2024

 

 

Infrastructure

 

Agriculture

 

Intersegment

 

Consolidated

Geographical Market:

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

$

599,705

 

$

119,973

 

$

(3,684

)

 

$

715,994

International

 

 

158,874

 

 

145,313

 

 

(6

)

 

 

304,181

Total sales

 

$

758,579

 

$

265,286

 

$

(3,690

)

 

$

1,020,175

 

 

 

 

 

 

 

 

 

 

 

 

 

Product Line:

 

 

 

 

 

 

 

 

 

 

 

 

Transmission, Distribution, and Substation

 

$

342,401

 

$

 

$

 

 

$

342,401

Lighting and Transportation

 

 

229,219

 

 

 

 

 

 

 

229,219

Coatings

 

 

88,046

 

 

 

 

(2,201

)

 

 

85,845

Telecommunications

 

 

64,288

 

 

 

 

 

 

 

64,288

Solar

 

 

34,625

 

 

 

 

(8

)

 

 

34,617

Irrigation Equipment and Parts

 

 

 

 

243,368

 

 

(1,481

)

 

 

241,887

Technology Products and Services

 

 

 

 

21,918

 

 

 

 

 

21,918

Total sales

 

$

758,579

 

$

265,286

 

$

(3,690

)

 

$

1,020,175

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirteen weeks ended September 30, 2023

 

 

Infrastructure

 

Agriculture

 

Intersegment

 

Consolidated

Geographical Market:

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

$

572,239

 

$

126,828

 

$

(3,055

)

 

$

696,012

International

 

 

182,837

 

 

171,655

 

 

(209

)

 

 

354,283

Total sales

 

$

755,076

 

$

298,483

 

$

(3,264

)

 

$

1,050,295

 

 

 

 

 

 

 

 

 

 

 

 

 

Product Line:

 

 

 

 

 

 

 

 

 

 

 

 

Transmission, Distribution, and Substation

 

$

297,967

 

$

 

$

 

 

$

297,967

Lighting and Transportation

 

 

252,603

 

 

 

 

 

 

 

252,603

Coatings

 

 

88,967

 

 

 

 

(1,241

)

 

 

87,726

Telecommunications

 

 

59,630

 

 

 

 

 

 

 

59,630

Solar

 

 

55,909

 

 

 

 

(209

)

 

 

55,700

Irrigation Equipment and Parts

 

 

 

 

273,639

 

 

(1,814

)

 

 

271,825

Technology Products and Services

 

 

 

 

24,844

 

 

 

 

 

24,844

Total sales

 

$

755,076

 

$

298,483

 

$

(3,264

)

 

$

1,050,295

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

SUMMARY OPERATING RESULTS

(Dollars in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirty-nine weeks ended September 28, 2024

 

 

Infrastructure

 

Agriculture

 

Intersegment

 

Consolidated

Geographical Market:

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

$

1,750,420

 

$

441,198

 

$

(12,836

)

 

$

2,178,782

International

 

 

494,515

 

 

364,526

 

 

(83

)

 

 

858,958

Total sales

 

$

2,244,935

 

$

805,724

 

$

(12,919

)

 

$

3,037,740

 

 

 

 

 

 

 

 

 

 

 

 

 

Product Line:

 

 

 

 

 

 

 

 

 

 

 

 

Transmission, Distribution, and Substation

 

$

990,744

 

$

 

$

 

 

$

990,744

Lighting and Transportation

 

 

694,877

 

 

 

 

 

 

 

694,877

Coatings

 

 

266,710

 

 

 

 

(7,321

)

 

 

259,389

Telecommunications

 

 

176,649

 

 

 

 

 

 

 

176,649

Solar

 

 

115,955

 

 

 

 

(81

)

 

 

115,874

Irrigation Equipment and Parts

 

 

 

 

730,798

 

 

(5,517

)

 

 

725,281

Technology Products and Services

 

 

 

 

74,926

 

 

 

 

 

74,926

Total sales

 

$

2,244,935

 

$

805,724

 

$

(12,919

)

 

$

3,037,740

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirty-nine weeks ended September 30, 2023

 

 

Infrastructure

 

Agriculture

 

Intersegment

 

Consolidated

Geographical Market:

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

$

1,743,635

 

$

450,678

 

$

(12,042

)

 

$

2,182,271

International

 

 

518,142

 

 

459,901

 

 

(1,242

)

 

 

976,801

Total sales

 

$

2,261,777

 

$

910,579

 

$

(13,284

)

 

$

3,159,072

 

 

 

 

 

 

 

 

 

 

 

 

 

Product Line:

 

 

 

 

 

 

 

 

 

 

 

 

Transmission, Distribution, and Substation

 

$

927,094

 

$

 

$

 

 

$

927,094

Lighting and Transportation

 

 

727,862

 

 

 

 

 

 

 

727,862

Coatings

 

 

270,201

 

 

 

 

(6,611

)

 

 

263,590

Telecommunications

 

 

195,505

 

 

 

 

 

 

 

195,505

Solar

 

 

141,115

 

 

 

 

(1,242

)

 

 

139,873

Irrigation Equipment and Parts

 

 

 

 

825,277

 

 

(5,431

)

 

 

819,846

Technology Products and Services

 

 

 

 

85,302

 

 

 

 

 

85,302

Total sales

 

$

2,261,777

 

$

910,579

 

$

(13,284

)

 

$

3,159,072

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

September 28,

 

December 30,

 

 

2024

 

2023

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

200,477

 

$

203,041

Receivables, net

 

 

714,010

 

 

657,960

Inventories

 

 

611,422

 

 

658,428

Contract assets

 

 

183,085

 

 

175,721

Prepaid expenses and other current assets

 

 

98,165

 

 

92,479

Total current assets

 

 

1,807,159

 

 

1,787,629

Property, plant, and equipment, net

 

 

609,001

 

 

617,394

Goodwill and other non-current assets

 

 

1,080,668

 

 

1,072,425

Total assets

 

$

3,496,828

 

$

3,477,448

 

 

 

 

 

 

 

LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS,

 

 

 

 

 

 

AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Current installments of long-term debt

 

$

531

 

$

719

Notes payable to banks

 

 

1,309

 

 

3,205

Accounts payable

 

 

353,883

 

 

358,311

Accrued expenses

 

 

274,089

 

 

277,764

Contract liabilities

 

 

100,150

 

 

70,978

Income taxes payable

 

 

28,066

 

 

Dividends payable

 

 

12,021

 

 

12,125

Total current liabilities

 

 

770,049

 

 

723,102

Long-term debt, excluding current installments

 

 

898,201

 

 

1,107,885

Operating lease liabilities

 

 

149,253

 

 

162,743

Other non-current liabilities

 

 

91,521

 

 

66,646

Total liabilities

 

 

1,909,024

 

 

2,060,376

Redeemable noncontrolling interests

 

 

46,111

 

 

62,792

Shareholders' equity

 

 

1,541,693

 

 

1,354,280

Total liabilities, redeemable noncontrolling interests, and shareholders' equity

 

$

3,496,828

$

3,477,448

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

Thirty-nine weeks ended

 

 

September 28,

 

September 30,

 

 

2024

 

2023

Cash flows from operating activities:

 

 

 

 

 

 

Net earnings

 

$

272,189

 

 

$

110,828

 

Depreciation and amortization

 

 

70,541

 

 

 

73,638

 

Contribution to defined benefit pension plan

 

 

(19,539

)

 

 

(15,259

)

Impairment of goodwill and other intangible assets

 

 

 

 

 

140,844

 

Gain on divestiture

 

 

 

 

 

(2,994

)

Change in working capital

 

 

44,615

 

 

 

(110,550

)

Other

 

 

11,458

 

 

 

(5,639

)

Net cash flows from operating activities

 

 

379,264

 

 

 

190,868

 

Cash flows from investing activities:

 

 

 

 

 

 

Purchases of property, plant, and equipment

 

 

(53,833

)

 

 

(71,233

)

Proceeds from divestiture, net of cash divested

 

 

 

 

 

6,369

 

Proceeds from property damage insurance claims

 

 

 

 

 

6,770

 

Acquisitions, net of cash acquired

 

 

 

 

 

(31,839

)

Other

 

 

(1,266

)

 

 

667

 

Net cash flows from investing activities

 

 

(55,099

)

 

 

(89,266

)

Cash flows from financing activities:

 

 

 

 

 

 

Net repayments on short-term borrowings

 

 

(1,899

)

 

 

(2,641

)

Proceeds from long-term borrowings

 

 

30,009

 

 

 

215,012

 

Principal repayments on long-term borrowings

 

 

(240,522

)

 

 

(109,335

)

Dividends paid

 

 

(36,337

)

 

 

(36,983

)

Purchases of redeemable noncontrolling interests

 

 

(17,745

)

 

 

 

Repurchases of common stock

 

 

(55,069

)

 

 

(166,663

)

Other

 

 

(4,314

)

 

 

(10,881

)

Net cash flows from financing activities

 

 

(325,877

)

 

 

(111,491

)

Effect of exchange rates on cash and cash equivalents

 

 

(852

)

 

 

(2,951

)

Net change in cash and cash equivalents

 

 

(2,564

)

 

 

(12,840

)

Cash and cash equivalents—beginning of period

 

 

203,041

 

 

 

185,406

 

Cash and cash equivalents—end of period

 

$

200,477

 

 

$

172,566

 

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES
SUMMARY OF EFFECT OF SIGNIFICANT NON-RECURRING ITEMS ON REPORTED RESULTS
REGULATION G RECONCILIATION
(Dollars and shares in thousands)
(Unaudited)

The non-GAAP table below discloses the impact of the impairment of goodwill and other intangible assets, realignment charges, intangible asset amortization (Prospera), and stock-based compensation recognized for the Prospera employees on fiscal 2023 results, as well as the impact of non-recurring tax benefit items on net earnings. Amounts may be impacted by rounding. We believe it is useful when considering Company performance for the non-GAAP adjusted net earnings and operating income to be taken into consideration by management and investors with the related reported GAAP measures.

The Company previously presented non-GAAP financial measures adjusted for Prospera intangible asset amortization and stock-based compensation recognized for the Prospera employees for a better investor understanding of Agriculture segment performance related to traditional segment products. The Company conducted its annual impairment testing of intangible asset value as of September 2, 2023 and significantly reduced the Prospera intangible asset value. Additionally, the Company’s Board of Directors approved certain realignment plans subsequent to the third quarter of fiscal 2023 that significantly affected the compensation recognized for the Prospera employees. As a result of this, the Company does not consider its historical adjustments related to Prospera to arrive at non-GAAP financial measures to be relevant to investor understanding of third quarter of fiscal 2023 and future segment performance.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirteen

 

 

 

 

Thirty-nine

 

 

 

 

 

weeks ended

 

Diluted

 

weeks ended

 

Diluted

 

 

September 30,

 

earnings (loss)

 

September 30,

 

earnings per

 

 

2023

 

per share1,2

 

2023

 

share1,2

Net earnings (loss) attrib. to Valmont Industries, Inc. - as reported

 

$

(49,028

)

 

$

(2.32

)

 

$

114,888

 

 

$

5.40

 

Impairment of goodwill and other intangible assets

 

 

140,844

 

 

 

6.67

 

 

 

140,844

 

 

 

6.62

 

Realignment charges

 

 

4,180

 

 

 

0.20

 

 

 

4,180

 

 

 

0.20

 

Prospera intangible asset amortization

 

 

 

 

 

 

 

 

3,290

 

 

 

0.15

 

Prospera stock-based compensation

 

 

 

 

 

 

 

 

4,278

 

 

 

0.20

 

Total adjustments, pre-tax

 

 

145,024

 

 

 

6.86

 

 

 

152,592

 

 

 

7.17

 

Tax effect of adjustments3

 

 

(5,432

)

 

 

(0.26

)

 

 

(6,524

)

 

 

(0.31

)

Non-recurring tax benefit items

 

 

(3,588

)

 

 

(0.17

)

 

 

(3,588

)

 

 

(0.17

)

Net earnings attributable to Valmont Industries, Inc. - adjusted

 

$

86,976

 

 

$

4.12

 

 

$

257,368

 

 

$

12.09

 

Average shares outstanding - diluted

 

 

 

 

 

21,131

 

 

 

 

 

 

21,290

 

 

1In the third quarter of fiscal 2023, the Company reported a GAAP net loss. In periods in which the Company recognizes a net loss, the Company excludes the impact of outstanding stock awards from the diluted loss per share calculation, as its inclusion would have an anti-dilutive effect. The adjusted diluted earnings per share calculation includes the impact of outstanding stock awards.
2Diluted earnings (loss) per share includes rounding.
3The tax effect of adjustments is calculated based on the income tax rate in each applicable jurisdiction.

VALMONT INDUSTRIES, INC. AND SUBSIDIARIES
SUMMARY OF EFFECT OF SIGNIFICANT NON-RECURRING ITEMS ON REPORTED RESULTS
REGULATION G RECONCILIATION
(Dollars in thousands)
(Unaudited)

The non-GAAP tables below disclose the impacts of the impairment of goodwill and other intangible assets, realignment charges, intangible asset amortization (Prospera), and stock-based compensation recognized for the Prospera employees on fiscal 2023 results. Amounts may be impacted by rounding. We believe it is useful when considering Company performance for the non-GAAP adjusted net earnings and operating income to be taken into consideration by management and investors with the related reported GAAP measures.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirteen weeks ended September 30, 2023

Operating Income (Loss) Reconciliation

 

Infrastructure

 

Agriculture

 

Corporate

 

Consolidated

Operating income (loss) - as reported

 

$

103,401

 

$

(99,670

)

 

$

(27,921

)

 

$

(24,190

)

Impairment of goodwill and other intangible assets

 

 

3,571

 

 

137,273

 

 

 

 

 

 

140,844

 

Realignment charges

 

 

1,069

 

 

907

 

 

 

2,204

 

 

 

4,180

 

Adjusted operating income (loss)

 

$

108,041

 

$

38,510

 

 

$

(25,717

)

 

$

120,834

 

Net sales - as reported

 

 

753,626

 

 

296,669

 

 

 

 

 

 

1,050,295

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) as a % of net sales

 

 

13.7

%

 

(33.6

)

%

 

NM

 

 

 

(2.3

)%

Adj. operating inc. (loss) as a % of net sales

 

 

14.3

%

 

13.0

 

%

 

NM

 

 

 

11.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thirty-nine weeks ended September 30, 2023

Operating Income (Loss) Reconciliation

 

Infrastructure

 

Agriculture

 

Corporate

 

Consolidated

Operating income (loss) - as reported

 

$

313,703

 

$

2,904

 

 

$

(88,598

)

 

$

228,009

 

Impairment of goodwill and other intangible assets

 

 

3,571

 

 

137,273

 

 

 

 

 

 

140,844

 

Realignment charges

 

 

1,069

 

 

907

 

 

 

2,204

 

 

 

4,180

 

Prospera intangible asset amortization

 

 

 

 

3,290

 

 

 

 

 

 

3,290

 

Prospera stock-based compensation

 

 

 

 

4,278

 

 

 

 

 

 

4,278

 

Adjusted operating income (loss)

 

$

318,343

 

$

148,652

 

 

$

(86,394

)

 

$

380,601

 

Net sales - as reported

 

 

2,253,924

 

 

905,148

 

 

 

 

 

 

3,159,072

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) as a % of net sales

 

 

13.9

%

 

0.3

 

%

 

NM

 

 

 

7.2

%

Adj. operating inc. (loss) as a % of net sales

 

 

14.1

%

 

16.4

 

%

 

NM

 

 

 

12.0

%

NM = not meaningful

 

Renee Campbell
renee.campbell@valmont.com

Source: Valmont Industries, Inc.