Delivered 6.7% Organic Revenue Growth
Net Income Grew 14.2% to $37.0 Million, and EPS
of $0.25 Per Diluted Share, with Adjusted EPS of $0.27
Achieved a 20.4% Year-over-Year Increase in
Adjusted EBITDA to $76.2 Million
Realized Trailing Twelve-month Free Cash Flow
Conversion of 117% of Adjusted Net Income
Raised Full-year 2023 Revenue and Adjusted
EBITDA Guidance
Janus International Group, Inc. (NYSE: JBI) (“Janus” or the
“Company”), a leading provider of cutting-edge access control
technologies and building product solutions for the self-storage
and other commercial and industrial sectors, today announced
financial results for the third quarter ended September 30,
2023.
Third Quarter 2023 Highlights
- Revenues of $280.1 million, a 6.7% increase compared to $262.5
million for the third quarter of 2022, driven by strong performance
in New Construction up 40.3%
- Net income of $37.0 million, or $0.25 per diluted share, a
14.2% increase compared to $32.4 million, or $0.22 per diluted
share in the third quarter of 2022.
- Adjusted Net Income (defined as Net Income plus the
corresponding after-tax adjustments shown in the Adjusted Net
Income reconciliation tables below) of $39.0 million, up 20.3%
compared to $32.4 million in the third quarter of 2022. Adjusted
Net Income per diluted share of $0.27, a 22.7% increase compared to
$0.22 per diluted share in the prior year quarter.
- Adjusted EBITDA of $76.2 million, a 20.4% increase compared to
$63.3 million for the third quarter of 2022, driven by increased
revenue in the New Construction sales channel, which more than
offset increases in general and administrative expenses. Adjusted
EBITDA as a percentage of revenues was 27.2%, an increase of
approximately 310 basis points from the prior year period due to
increased revenue from commercial actions taken in 2022 and product
mix, partially offset by increased labor costs as the business
scales for continued growth including additional investments in our
cutting edge Nokē Smart Access Solutions.
- Quarter-end net leverage ratio of 1.8x – a decrease of 1.5x
from the third quarter of 2022 and 0.3x from the second quarter of
2023.
“Building on the momentum from the first half of the year, the
Janus team delivered another quarter of outstanding operational
performance driven by particularly strong results from our New
Construction sales channel,” said Ramey Jackson, Chief Executive
Officer. “Industry fundamentals continue to drive investment in
self-storage capacity which resulted in substantial year-over-year
revenue and adjusted EBITDA improvement, sizable expansion in
adjusted EBITDA margins, strong free cash flow generation and
another meaningful decline in net leverage.”
Mr. Jackson continued, “Our market-leading products and
solutions, commitment to operational excellence, and best-in-class
service model positions us well to deliver exceptional performance
for our customers across each of our end markets. Given our robust
year-to-date results, the strength in our backlog, and our outlook
for the balance of the year, we are pleased to once again raise our
full-year 2023 revenue and adjusted EBITDA guidance.”
2023 Financial Guidance
Based on the Company’s current business outlook, Janus is
raising full-year 2023 guidance as follows:
- Revenue in a range of $1.08 billion to $1.09 billion, up from
the previous range of $1.07 billion to $1.09 billion. The new range
represents a 6.4% increase at the midpoint as compared to 2022
levels.
- Adjusted EBITDA in a range of $280 million to $290 million, up
from the previous range of $269.5 million to $289.5 million. The
new range represents a 25.6% increase at the midpoint as compared
to 2022 levels.
The estimates set forth above were prepared by the Company’s
management and are based upon a number of assumptions. See
“Forward-Looking Statements.” The Company has excluded a
quantitative reconciliation with respect to the Company’s 2023
guidance under the “unreasonable efforts” exception in Item
10(e)(1)(i)(B) of Regulation S-K. See "Non-GAAP Financial Measures"
below for additional information.
About Janus International Group
Janus International Group, Inc. (www.JanusIntl.com) is a leading
global manufacturer and supplier of turn-key self-storage,
commercial and industrial building solutions, including: roll-up
and swing doors, hallway systems, re-locatable storage units and
facility and door automation technologies. The Janus team operates
out of several U.S. locations and seven locations
internationally.
Conference Call and Webcast
The Company will host a conference call and webcast to review
third quarter results and conduct a question-and-answer session on
Monday, November 6, 2023, at 10:00 a.m. Eastern time. The live
webcast and archived replay of the conference call can be accessed
on the Investors section of the Company’s website at
www.janusintl.com. For those unable to access the webcast, the
conference call will be accessible domestically or internationally,
by dialing 1-877-407-0789 or 1-201-689-8562, respectively. Upon
dialing in, please request to join the Janus International Group
Third Quarter 2023 Earnings Conference Call. To access the replay
of the call, dial 1-844-512-2921 (Domestic) and 1-412-317-6671
(International) with pass code 13741867.
Forward Looking Statements
Certain statements in this communication, including the
estimated guidance provided under “2023 Financial Guidance” herein,
may be considered “forward-looking statements” within the meaning
of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. All
statements other than statements of historical fact included in
this communication are forward-looking statements, including, but
not limited to statements regarding Janus’s belief regarding the
demand outlook for Janus’s products and the strength of the
industrials markets. When used in this communication, words such as
“may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,”
“believe,” “estimate,” “continue,” or the negative of such terms or
other similar expressions, as they relate to the management team,
identify forward-looking statements. Such forward-looking
statements are based on the current beliefs of Janus’s management,
based on currently available information, as to the outcome and
timing of future events, and involve factors, risks, and
uncertainties that may cause actual results in future periods to
differ materially from such statements. In addition to factors
previously disclosed in Janus’s reports filed with the SEC and
those identified elsewhere in this communication, the following
factors, among others, could cause actual results to differ
materially from forward-looking statements or historical
performance: (i) risks of the self-storage industry; (ii) the
highly competitive nature of the self-storage industry and Janus’s
ability to compete therein; (iii) litigation, complaints, and/or
adverse publicity; (iv) cyber incidents or directed attacks that
could result in information theft, data corruption, operational
disruption and/or financial loss; and (v) the risk that the demand
outlook for Janus’s products may not be as strong as anticipated.
There can be no assurance that the events, results, trends or
guidance regarding financial outlook identified in these
forward-looking statements will occur or be achieved.
Forward-looking statements speak only as of the date they are made,
and Janus is not under any obligation and expressly disclaims any
obligation, to update, alter or otherwise revise any
forward-looking statement, whether as a result of new information,
future events or otherwise, except as required by law. This
communication is not intended to be all-inclusive or to contain all
the information that a person may desire in considering an
investment in Janus and is not intended to form the basis of an
investment decision in Janus. All subsequent written and oral
forward-looking statements concerning Janus or other matters and
attributable to Janus or any person acting on its behalf are
expressly qualified in their entirety by the cautionary statements
above and under the heading “Risk Factors” in Janus’s most recently
filed Annual Report on Form 10-K and Quarterly Report on Form 10-Q,
as updated from time to time in amendments and its subsequent
filings with the SEC.
Non-GAAP Financial Measures
Janus uses measures of performance that are not required by or
presented in accordance with GAAP in the United States. Non-GAAP
financial performance measures are used to supplement the financial
information presented on a GAAP basis. These non-GAAP financial
measures should not be considered in isolation or as a substitute
for the relevant GAAP measures and should be read in conjunction
with information presented on a GAAP basis.
Adjusted EBITDA and Adjusted Net Income are non-GAAP financial
measures used by Janus to evaluate its operating performance,
generate future operating plans, and make strategic decisions,
including those relating to operating expenses and the allocation
of internal resources. Accordingly, Janus believes Adjusted EBITDA
and Adjusted Net Income provide useful information to investors and
others in understanding and evaluating Janus’s operating results in
the same manner as its management and board of directors and in
comparison with Janus’s peer group companies. In addition, Adjusted
EBITDA and Adjusted Net Income provide useful measures for
period-to-period comparisons of Janus’s business, as they remove
the effect of certain non-recurring events and other non-recurring
charges, such as acquisitions, and certain variable or
non-recurring charges. Adjusted EBITDA is defined as net income
excluding interest expense, income taxes, depreciation expense,
amortization, and other non-operational, non-recurring items.
Adjusted Net Income is defined as net income plus the corresponding
tax-adjusted add-backs shown in the Adjusted EBITDA
reconciliation.
Please note that the Company has not provided the most directly
comparable GAAP financial measure, or a quantitative reconciliation
thereto, for the Adjusted EBITDA forward-looking guidance for 2023
included in this communication in reliance on the "unreasonable
efforts" exception provided under Item 10(e)(1)(i)(B) of Regulation
S-K. Providing the most directly comparable GAAP financial measure,
or a quantitative reconciliation thereto, cannot be done without
unreasonable effort due to the inherent uncertainty and difficulty
in predicting certain non-cash, material and/or non-recurring
expenses or benefits, legal settlements or other matters, and
certain tax positions. Because these adjustments are inherently
variable and uncertain and depend on various factors that are
beyond the Company's control, the Company is also unable to predict
their probable significance. The variability of these items could
have an unpredictable, and potentially significant, impact on our
future GAAP financial results.
Adjusted EBITDA and Adjusted Net Income should not be considered
in isolation of, or as an alternative to, measures prepared in
accordance with GAAP. There are a number of limitations related to
the use of Adjusted EBITDA and Adjusted Net Income rather than net
income (loss), which is the nearest GAAP equivalent of Adjusted
EBITDA and Adjusted Net Income. These limitations include that the
non-GAAP financial measures: exclude depreciation and amortization,
and although these are non-cash expenses, the assets being
depreciated may be replaced in the future; do not reflect interest
expense, or the cash requirements necessary to service interest on
debt, which reduces cash available; do not reflect the provision
for or benefit from income tax that may result in payments that
reduce cash available; exclude non-recurring items (i.e., the
extinguishment of debt); and may not be comparable to similar
non-GAAP financial measures used by other companies, because the
expenses and other items that Janus excludes in the calculation of
these non-GAAP financial measures may differ from the expenses and
other items, if any, that other companies may exclude from these
non-GAAP financial measures when they report their operating
results. Because of these limitations, these non-GAAP financial
measures should be considered along with other operating and
financial performance measures presented in accordance with
GAAP.
Janus International Group, Inc.
Consolidated Statements of Operations and Comprehensive Income
(Loss) (In millions)
Three Months Ended
Nine months ended
September 30,
2023
October 1,
2022
September 30,
2023
October 1,
2022
REVENUES
Product revenues
$
237.8
$
233.7
$
686.0
$
654.5
Service revenues
42.3
28.8
116.6
85.3
Total Revenues
$
280.1
$
262.5
$
802.6
$
739.8
Product cost of revenues
129.7
144.7
380.4
418.8
Service cost of revenues
31.3
21.1
86.9
63.6
Cost of Revenues
$
161.0
$
165.8
$
467.3
$
482.4
GROSS PROFIT
119.1
96.7
335.3
257.4
OPERATING EXPENSE
Selling and marketing
17.7
14.5
49.2
42.2
General and administrative
34.9
28.4
104.3
86.3
Operating Expenses
$
52.6
$
42.9
$
153.5
$
128.5
INCOME FROM OPERATIONS
66.5
53.8
181.8
128.9
Interest expense
(14.5
)
(11.0
)
(45.3
)
(28.6
)
Loss on extinguishment and modification of
debt
(3.9
)
—
(3.9
)
—
Other income (expense)
1.3
0.2
1.1
(0.3
)
INCOME BEFORE TAXES
$
49.4
$
43.0
$
133.7
$
100.0
Provision for Income Taxes
12.4
10.6
33.7
25.0
NET INCOME
$
37.0
$
32.4
$
100.0
$
75.0
Other Comprehensive Loss
(1.7
)
(3.0
)
(0.4
)
(6.9
)
COMPREHENSIVE INCOME
35.3
29.4
99.6
68.1
Net income attributable to common
stockholders
$
37.0
$
32.4
$
100.0
$
75.0
Weighted-average shares outstanding,
basic and diluted (Note 12)
Basic
146,827,175
146,639,452
146,765,567
146,592,296
Diluted
146,993,865
146,717,917
146,839,308
146,671,509
Net income per share, basic and diluted
(Note 12)
Basic
$
0.25
$
0.22
$
0.68
$
0.51
Diluted
$
0.25
$
0.22
$
0.68
$
0.51
Janus International Group, Inc.
Consolidated Balance Sheets (In millions)
September 30,
December 31,
2023
2022
ASSETS
Current Assets
Cash
$
109.7
$
78.4
Accounts receivable, less allowance for
credit losses; $3.8 and $4.5, at September 30, 2023 and December
31, 2022, respectively
171.3
155.4
Contract assets
51.3
39.3
Inventory, net
54.3
67.7
Prepaid expenses
7.9
9.1
Other current assets
4.1
13.3
Total current assets
$
398.6
$
363.2
Right-of-use assets, net
49.7
44.3
Property, plant and equipment, net
48.6
42.1
Intangible assets, net
382.2
404.4
Goodwill
368.1
368.2
Deferred tax asset, net
46.6
46.6
Other assets
3.1
1.8
Total assets
$
1,296.9
$
1,270.6
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current Liabilities
Accounts payable
$
56.0
$
52.3
Billing in excess of costs
17.9
21.4
Current maturities of long-term debt
7.1
8.3
Accrued expenses and other current
liabilities
80.2
70.6
Total current liabilities
$
161.2
$
152.6
Long-term debt, net
608.5
699.9
Deferred tax liability, net
1.7
1.9
Other long-term liabilities
45.4
40.9
Total liabilities
$
816.8
$
895.3
STOCKHOLDERS’ EQUITY
Common Stock, 825,000,000 shares
authorized, $0.0001 par value, 146,828,032 and 146,703,894 shares
issued and outstanding at September 30, 2023 and December 31, 2022,
respectively
$
—
$
—
Treasury stock, at cost, 19,833 and zero
shares as of September 30, 2023 and December 31, 2022,
respectively
(0.2
)
—
Additional paid-in capital
287.3
281.9
Accumulated other comprehensive loss
(5.2
)
(4.8
)
Retained earnings
198.2
98.2
Total stockholders’ equity
$
480.1
$
375.3
Total liabilities and stockholders’
equity
$
1,296.9
$
1,270.6
Janus International Group, Inc.
Consolidated Statements of Cash Flows (In millions)
Nine Months Ended
September 30,
2023
October 1,
2022
Cash Flows Provided By Operating
Activities
Net income
$
100.0
$
75.0
Adjustments to reconcile net income to
net cash provided by operating activities
Depreciation of property, plant and
equipment
6.6
5.8
Noncash lease expense
4.7
4.0
Provision (reversal) for inventory
obsolescence
1.4
(0.7
)
Amortization of intangibles
22.3
22.3
Deferred finance fee amortization
3.1
2.8
Provision (reversal) for losses on
accounts receivable
(0.7
)
1.2
Share-based compensation
5.4
2.1
Loss on extinguishment of debt
1.6
—
Loss on sale of equipment
0.1
—
Loss on abandonment of lease
—
0.6
Loss (gain) on equity method
investment
0.1
(0.1
)
Changes in operating assets and
liabilities
Accounts receivable
(14.9
)
(45.9
)
Contract assets
(12.1
)
(7.7
)
Prepaid expenses and other current
assets
9.8
(0.5
)
Inventory
12.0
(11.8
)
Other assets
0.1
—
Accounts payable
3.6
0.8
Billings in excess of costs
(3.6
)
4.0
Accrued expenses and other current
liabilities
11.0
13.6
Other long-term liabilities
(4.0
)
(2.8
)
Net Cash Provided By Operating
Activities
$
146.5
$
62.7
Cash Flows Used In Investing
Activities
Proceeds from sale of equipment
$
0.1
$
0.1
Purchases of property and equipment
(13.5
)
(7.9
)
Cash paid for acquisitions, net of cash
acquired
(1.0
)
—
Net Cash Used In Investing
Activities
$
(14.4
)
$
(7.8
)
Cash Flows Used In Financing
Activities
Payments on line of credit
$
—
$
(6.4
)
Proceeds from long-term debt
337.6
—
Principal payments on long-term debt
(426.9
)
(6.1
)
Principal payments under finance lease
obligations
(0.5
)
(0.1
)
Payments for deferred financing fees
(11.2
)
—
Cash Used In Financing
Activities
$
(101.0
)
$
(12.6
)
Effect of exchange rate changes on
cash
$
0.2
$
(0.1
)
Net Increase in Cash
$
31.3
$
42.2
Cash, Beginning of Period
$
78.4
$
13.2
Cash, End of Period
$
109.7
$
55.4
Supplemental Cash Flows
Information
Interest paid
$
38.9
$
28.4
Income taxes paid
$
22.5
$
21.7
Cash paid for operating leases included in
operating activities
$
6.2
$
5.8
Non-cash investing and financing
activities:
Right-of-use assets obtained in exchange
for operating lease obligations
$
4.5
$
48.0
Right-of-use assets obtained in exchange
for finance lease obligations
$
2.4
$
1.4
RSU Shares withheld related to employee
taxes
$
0.2
$
—
Janus International Group, Inc.
Reconciliation of Net Income to Adjusted EBITDA (In
millions)
Three Months Ended
Variance
September 30,
2023
October 1,
2022
$
%
Net Income
$
37.0
$
32.4
$
4.6
14.2
%
Interest Expense
$
14.5
$
11.0
$
3.5
31.8
%
Income Taxes
$
12.4
$
10.6
$
1.8
17.0
%
Depreciation
$
2.2
$
2.0
$
0.2
10.0
%
Amortization
$
7.4
$
7.4
$
—
—
%
EBITDA
$
73.5
$
63.4
$
10.1
15.9
%
Restructuring charges(1)
$
0.2
$
—
$
0.2
100.0
%
Acquisition (Income) Expense(2)
$
(1.4
)
$
(0.1
)
$
(1.3
)
1300.0
%
Loss on extinguishment of debt(3)
$
3.9
$
—
$
3.9
—
%
Adjusted EBITDA
$
76.2
$
63.3
$
12.9
20.4
%
Nine Months Ended
Variance
September 30,
2023
October 1,
2022
$
%
Net Income
$
100.0
$
75.0
$
25.0
33.3
%
Interest Expense
$
45.3
$
28.6
$
16.7
58.4
%
Income Taxes
$
33.7
$
25.0
$
8.7
34.8
%
Depreciation
$
6.6
$
5.8
$
0.8
13.8
%
Amortization
$
22.3
$
22.3
$
—
—
%
EBITDA
$
207.9
$
156.7
$
51.2
32.7
%
Restructuring charges(1)
$
1.1
$
1.1
$
(0.2
)
(16.7
)%
Acquisition (Income) Expense(2)
$
(1.4
)
$
0.7
$
(2.1
)
(300.0
)%
Loss on extinguishment of debt(3)
$
3.9
$
—
$
3.9
—
%
COVID-19 related expenses(4)
$
—
$
0.1
$
(0.1
)
(100.0
)%
Adjusted EBITDA
$
211.4
$
158.7
$
52.7
33.2
%
(1)
Adjustments consist of the following: 1)
facility relocations, 2) severance and hiring costs associated with
our strategic transformation, including executive leadership team
changes, strategic business assessment and transformation
projects.
(2)
Income or expenses related to the
transition services agreement and legal settlement for an
acquisition.
(3)
Adjustment for loss on extinguishment of
debt regarding the write off of unamortized fees and third-party
fees as a result of the debt modification completed in August
2023.
(4)
Adjustment consists of signage, cleaning
and supplies to maintain work environments necessary to adhere to
CDC guidelines during the COVID-19 pandemic.
Janus International Group, Inc.
Reconciliation of Net Income to Non-GAAP Adjusted Net Income (In
thousands)
Three Months Ended
September 30,
2023
October 1,
2022
Net Income (Loss)
$
37.0
$
32.4
Net Income Adjustments(1)
$
2.7
$
(0.1
)
Tax Effect on Net Income
Adjustments(2)
$
(0.7
)
$
—
Non-GAAP Adjusted Net Income
$
39.0
$
32.3
Nine Months Ended
September 30,
2023
October 1,
2022
Net Income (Loss)
$
100.0
$
75.0
Net Income Adjustments(1)
$
3.6
$
1.9
Tax Effect on Net Income
Adjustments(2)
$
(0.9
)
$
(0.5
)
Non-GAAP Adjusted Net Income
$
102.7
$
76.4
(1)
Refer to SEC public filings for detailed
breakout. This amount reconciles to the EBITDA Adjustments/Non-GAAP
Adjustments in the Reconciliation of Net Income to Adjusted EBITDA
table above
(2)
Tax effected for the net income
adjustments. Used effective tax rates 25.1% and 24.6% for the three
months ended September 30, 2023 and October 1, 2022 and 25.2% for
the six months ended September 30, 2023 and October 1,
2022
Janus International Group, Inc.
Non-GAAP Adjusted EPS* (In millions)
Three Months Ended
September 30,
2023
October 1,
2022
Numerator:
GAAP Net Income
$
37.0
$
32.4
Non-GAAP Adjusted Net Income
$
39.0
$
32.3
Denominator:
Weighted average number of shares:
Basic
146,827,175
146,639,452
Adjustment for Dilutive Securities
166,690
78,465
Diluted
146,993,865
146,717,917
GAAP Basic EPS
$
0.25
$
0.22
GAAP Diluted EPS
$
0.25
$
0.22
Non-GAAP Adjusted Basic EPS
$
0.27
$
0.22
Non-GAAP Adjusted Diluted EPS
$
0.27
$
0.22
Nine Months Ended
September 30,
2023
October 1,
2022
Numerator:
GAAP Net Income
$
100.0
$
75.0
Non-GAAP Adjusted Net Income
$
102.7
$
76.4
Denominator:
Weighted average number of shares:
Basic
146,765,567
146,592,296
Adjustment for Dilutive Securities
73,741
79,213
Diluted
146,839,308
146,671,509
GAAP Basic EPS
$
0.68
$
0.51
GAAP Diluted EPS
$
0.68
$
0.51
Non-GAAP Adjusted Basic EPS
$
0.70
$
0.52
Non-GAAP Adjusted Diluted EPS
$
0.70
$
0.52
*Janus uses measures of performance that
are not required by or presented in accordance with GAAP in the
United States. Non-GAAP financial performance measures are used to
supplement the financial information presented on a GAAP basis.
These non-GAAP financial measures should not be considered in
isolation or as a substitute for the relevant GAAP measures and
should be read in conjunction with information presented on a GAAP
basis.
Janus International Group, Inc.
Non-GAAP Free Cash Flow Conversion* (In millions)
Nine Months Ended
September 30,
2023
October 1,
2022
Cash flow from operating
activities
$
146.5
$
62.7
Less capital expenditure
$
(13.5
)
$
(7.9
)
Free cash flow
$
133.0
$
54.8
Non-GAAP Adjusted Net Income
$
102.7
$
76.4
Free cash flow conversion of Non-GAAP
Adjusted Net Income
130
%
72
%
Trailing Twelve-Months
Ended
September 30,
2023
October 1,
2022
Cash flow from operating
activities
$
172.4
$
77.7
Less capital expenditure
$
(14.4
)
$
(11.8
)
Free cash flow
$
158.0
$
65.9
Non-GAAP Adjusted Net Income
$
135.4
$
95.8
Free cash flow conversion of Non-GAAP
Adjusted Net Income
117
%
69
%
*Janus uses measures of performance that
are not required by or presented in accordance with GAAP in the
United States. Non-GAAP financial performance measures are used to
supplement the financial information presented on a GAAP basis.
These non-GAAP financial measures should not be considered in
isolation or as a substitute for the relevant GAAP measures and
should be read in conjunction with information presented on a GAAP
basis.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231106331495/en/
Investor Contact John Rohlwing Vice President, Investor
Relations, FP&A & M&A, Janus International 770-562-6399
IR@janusintl.com
Media Contact Suzanne Reitz Vice President of Marketing,
Janus International 770-746-9576 Marketing@Janusintl.com
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