Strong quarterly results and resilient demand support
healthy outlook for 2024
PITTSBURGH, Feb. 14,
2024 /PRNewswire/ -- Global safety equipment and
solutions provider MSA Safety Incorporated (NYSE: MSA) today
reported financial results for the fourth quarter and year ended
December 31, 2023.
Fourth Quarter 2023 Highlights
- Achieved net sales of $495
million, a 12% increase year-over-year, reflecting strength
across MSA's portfolio and in each reportable segment.
- Generated GAAP operating income of $102
million, or 20.6% of sales, and adjusted operating income of
$115 million, or 23.3% of sales.
- Recorded GAAP net income of $76
million, or $1.93 per diluted
share, and adjusted net income of $82
million, or $2.06 per diluted
share.
- Invested $12 million for capital
expenditures, repaid $145 million of
debt, and returned $18 million to
shareholders through dividends.
Full Year 2023 Highlights
- Achieved net sales of $1.8
billion, a 17% increase year-over-year.
- Generated GAAP operating income of $231
million, or 12.9% of sales, and adjusted operating income of
$398 million, or 22.2% of sales.
- Recorded GAAP earnings of $59
million, or $1.48 per diluted
share, and adjusted earnings of $278
million, or $7.03 per diluted
share.
- Invested $43 million for capital
expenditures, repaid $289 million of
debt subsequent to the January 2023
divestiture of a subsidiary holding legacy liabilities, and
returned $73 million to shareholders
through dividends.
- Strengthened financial position with net leverage of 1.0x at
year end.
"Our strong performance in the fourth quarter capped an
outstanding 2023 for MSA," said Nish
Vartanian, MSA Safety Chairman and Chief Executive Officer.
"Our team delivered excellent full year results with double-digit
sales growth and robust margin expansion. Investments we have made
in the development of innovative new products and solutions, our
commercial strategy, and across our functional support areas are
enabling us to better serve our customers and advance our mission.
We enter 2024 with strong momentum and an ongoing focus on
delivering value for all our stakeholders. Looking ahead, I believe
our unique mission, highly talented team, and differentiated
portfolio provide a solid foundation to fuel future growth and
generate attractive long-term returns for our shareholders."
|
Financial
Highlights and Balance Sheet
|
|
|
Financial
Highlights
|
|
Three Months
Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
($ millions, except
per share data)
|
|
2023
|
|
2022
|
|
% Change
(a)
|
|
2023
|
|
2022
|
|
% Change
(a)
|
|
Net Sales
|
|
$
495
|
|
$
443
|
|
12 %
|
|
$ 1,788
|
|
$ 1,528
|
|
17 %
|
|
Operating
Income
|
|
102
|
|
71
|
|
45 %
|
|
231
|
|
239
|
|
(3) %
|
|
Adjusted Operating
Income
|
|
115
|
|
96
|
|
20 %
|
|
398
|
|
290
|
|
37 %
|
|
Net Income
|
|
76
|
|
51
|
|
48 %
|
|
59
|
|
180
|
|
(67) %
|
|
Diluted EPS
|
|
1.93
|
|
1.31
|
|
47 %
|
|
1.48
|
|
4.56
|
|
(68) %
|
|
Adjusted
Earnings
|
|
82
|
|
71
|
|
15 %
|
|
278
|
|
223
|
|
25 %
|
|
Adjusted Diluted
EPS
|
|
2.06
|
|
1.80
|
|
14 %
|
|
7.03
|
|
5.65
|
|
24 %
|
|
|
(a)
Percentage change may not calculate exactly due to
rounding.
|
"Our team's strong commercial and operational execution resulted
in a year of accelerated sales growth, margin enhancement, and free
cash flow generation. We also made substantial progress during the
year to strengthen our financial position, with net leverage of
1.0x at year end," commented Lee
McChesney, MSA Safety Senior Vice President and Chief
Financial Officer. "As we move forward, we expect to build on our
progress and leverage the MSA Business System to drive further
sales growth and margin expansion. Despite the backdrop of
macroeconomic and geopolitical uncertainty, we are focused on
delivering mid-single digit sales growth in 2024. We continue
to execute our disciplined and balanced capital allocation strategy
with a focus on driving sustainable value creation in 2024 and
beyond."
Conference Call
MSA Safety will host a conference call on Thursday, February 15, 2024 at 10:00 a.m. Eastern Time to discuss the fourth
quarter and full year 2023 results. The call and an accompanying
slide presentation will be webcast at
http://investors.msasafety.com/ under the "News and Events" tab,
subheading "Events & Presentations." Investors and interested
parties can also dial into the call at 1-844-854-4415 (Toll Free) or 1-412-902-6599 (International).
When prompted, please instruct the operator to be joined into the
MSA Safety Incorporated conference call. A replay of the conference
call will be available at http://investors.msasafety.com/ shortly
after the conclusion of the presentation and will be available for
the next 90 days.
Investor Day Announcement
MSA Safety will hold an Investor Day for institutional investors
and financial analysts in New York
City on Wednesday, May 22,
2024, with a presentation given by members of executive
management, along with Q&A sessions. A live webcast and
presentation slides will be posted on the day of the event. Dial-in
information and a detailed agenda will be provided at a later date.
Due to limited capacity, in-person attendance is by invitation
only.
|
MSA Safety
Incorporated
Condensed Consolidated
Statement of Income (Unaudited)
(In thousands, except
per share amounts)
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
495,358
|
|
$
443,254
|
|
$
1,787,647
|
|
$
1,527,953
|
|
Cost of products
sold
|
257,175
|
|
246,002
|
|
935,509
|
|
854,122
|
|
Gross profit
|
238,183
|
|
197,252
|
|
852,138
|
|
673,831
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
107,043
|
|
91,494
|
|
396,645
|
|
338,872
|
|
Research and
development
|
19,082
|
|
13,995
|
|
67,988
|
|
57,012
|
|
Restructuring
charges
|
1,510
|
|
4,819
|
|
9,892
|
|
7,965
|
|
Currency exchange
losses, net
|
8,298
|
|
5,467
|
|
17,079
|
|
10,255
|
|
Product liability
expense
|
—
|
|
10,857
|
|
3
|
|
20,590
|
|
Loss on divestiture of
MSA LLC
|
—
|
|
—
|
|
129,211
|
|
—
|
|
Operating
income
|
102,250
|
|
70,620
|
|
231,320
|
|
239,137
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
9,584
|
|
7,502
|
|
46,733
|
|
21,660
|
|
Other income,
net
|
(6,614)
|
|
(5,935)
|
|
(22,101)
|
|
(21,056)
|
|
Total other expense,
net
|
2,970
|
|
1,567
|
|
24,632
|
|
604
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
99,280
|
|
69,053
|
|
206,688
|
|
238,533
|
|
Provision for income
taxes
|
22,870
|
|
17,564
|
|
148,105
|
|
58,903
|
|
Net income
|
76,410
|
|
51,489
|
|
58,583
|
|
179,630
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to MSA Safety Incorporated common
shareholders:
|
|
|
|
|
|
|
|
|
Basic
|
$
1.94
|
|
$
1.31
|
|
$
1.49
|
|
$
4.58
|
|
Diluted
|
$
1.93
|
|
$
1.31
|
|
$
1.48
|
|
$
4.56
|
|
|
|
|
|
|
|
|
|
Basic shares
outstanding
|
39,339
|
|
39,200
|
|
39,307
|
|
39,232
|
|
Diluted shares
outstanding
|
39,541
|
|
39,387
|
|
39,473
|
|
39,407
|
|
|
|
|
|
|
|
|
|
MSA Safety
Incorporated
Condensed Consolidated
Balance Sheet (Unaudited)
(In
thousands)
|
|
|
December 31,
2023
|
|
December 31,
2022
|
|
Assets
|
|
|
|
|
Cash and cash
equivalents
|
$
146,442
|
|
$
162,902
|
|
Trade receivables,
net
|
294,678
|
|
297,028
|
|
Inventories
|
292,604
|
|
338,316
|
|
Notes receivable,
insurance companies
|
—
|
|
5,931
|
|
Other current
assets
|
52,546
|
|
75,949
|
|
Total current assets
|
786,270
|
|
880,126
|
|
|
|
|
|
Property, plant and
equipment, net
|
211,877
|
|
207,552
|
|
Prepaid pension
cost
|
172,161
|
|
141,643
|
|
Goodwill
|
627,534
|
|
620,622
|
|
Intangible assets,
net
|
266,134
|
|
281,853
|
|
Notes receivable,
insurance companies, noncurrent
|
—
|
|
38,695
|
|
Insurance receivable,
noncurrent
|
—
|
|
110,300
|
|
Other noncurrent
assets
|
106,174
|
|
96,185
|
|
Total
assets
|
$
2,170,150
|
|
$
2,376,976
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
Notes payable and
current portion of long-term debt, net
|
$
26,522
|
|
$
7,387
|
|
Accounts
payable
|
111,872
|
|
112,532
|
|
Other current
liabilities
|
194,424
|
|
225,946
|
|
Total
current liabilities
|
332,818
|
|
345,865
|
|
|
|
|
|
Long-term debt,
net
|
575,170
|
|
565,445
|
|
Pensions and other
employee benefits
|
143,967
|
|
137,810
|
|
Deferred tax
liabilities
|
102,419
|
|
31,881
|
|
Product liability and
other noncurrent liabilities
|
48,974
|
|
372,234
|
|
Total shareholders'
equity
|
966,802
|
|
923,741
|
|
Total
liabilities and shareholders' equity
|
$
2,170,150
|
|
$
2,376,976
|
|
MSA Safety
Incorporated
Condensed Consolidated
Statement of Cash Flows (Unaudited)
(In
thousands)
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
Net income
|
$ 76,410
|
|
$ 51,489
|
|
$ 58,583
|
|
$
179,630
|
|
Depreciation and
amortization
|
15,808
|
|
14,434
|
|
60,773
|
|
56,317
|
|
Tax-effected loss on
divestiture of MSA LLC
|
—
|
|
—
|
|
199,578
|
|
—
|
|
Contribution on
divestiture of MSA LLC
|
—
|
|
—
|
|
(341,186)
|
|
—
|
|
Change in working
capital and other operating
|
66,696
|
|
(12,371)
|
|
115,109
|
|
(78,492)
|
|
Cash flow from
operating activities
|
158,914
|
|
53,552
|
|
92,857
|
|
157,455
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
(11,785)
|
|
(13,800)
|
|
(42,764)
|
|
(42,553)
|
|
Change in short-term
investments
|
—
|
|
15,138
|
|
—
|
|
39,458
|
|
Property disposals and
other investing
|
121
|
|
(1,427)
|
|
2,811
|
|
(1,389)
|
|
Cash flow used
in investing activities
|
(11,664)
|
|
(89)
|
|
(39,953)
|
|
(4,484)
|
|
|
|
|
|
|
|
|
|
Change in
debt
|
(144,750)
|
|
(40,000)
|
|
23,898
|
|
(13,000)
|
|
Cash dividends
paid
|
(18,489)
|
|
(18,050)
|
|
(73,488)
|
|
(71,497)
|
|
Other
financing
|
479
|
|
863
|
|
(2,663)
|
|
(28,853)
|
|
Cash flow used
in financing activities
|
(162,760)
|
|
(57,187)
|
|
(52,253)
|
|
(113,350)
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash,
cash equivalents and
restricted cash
|
(2,519)
|
|
6,867
|
|
(16,671)
|
|
(16,631)
|
|
|
|
|
|
|
|
|
|
(Decrease) increase in
cash, cash equivalents and restricted cash
|
$
(18,029)
|
|
$
3,143
|
|
$
(16,020)
|
|
$ 22,990
|
|
MSA Safety
Incorporated
Segment Information
(Unaudited)
(In thousands, except
percentage amounts)
|
|
|
Americas
|
|
International
|
|
Corporate
|
|
Consolidated
|
|
Three Months Ended
December 31, 2023
|
|
|
|
|
|
|
|
|
Net sales to external
customers
|
$
332,676
|
|
$
162,682
|
|
$
—
|
|
$
495,358
|
|
Operating
income
|
|
|
|
|
|
|
102,250
|
|
Operating margin
%
|
|
|
|
|
|
|
20.6 %
|
|
Restructuring
charges
|
|
|
|
|
|
|
1,510
|
|
Currency exchange
losses, net
|
|
|
|
|
|
|
8,298
|
|
Amortization of
acquisition-related intangible assets
|
|
|
|
|
|
|
2,310
|
|
Transaction costs
(a)
|
|
|
|
|
|
|
887
|
|
Adjusted operating
income (loss)
|
99,189
|
|
29,600
|
|
(13,534)
|
|
115,255
|
|
Adjusted operating
margin %
|
29.8 %
|
|
18.2 %
|
|
|
|
23.3 %
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
13,498
|
|
Adjusted
EBITDA
|
108,968
|
|
33,108
|
|
(13,323)
|
|
128,753
|
|
Adjusted EBITDA margin
%
|
32.8 %
|
|
20.4 %
|
|
|
|
26.0 %
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31, 2022
|
|
|
|
|
|
|
|
|
Net sales to external
customers
|
$
289,122
|
|
$
154,132
|
|
$
—
|
|
$
443,254
|
|
Operating
income
|
|
|
|
|
|
|
70,620
|
|
Operating margin
%
|
|
|
|
|
|
|
15.9 %
|
|
Restructuring
charges
|
|
|
|
|
|
|
4,819
|
|
Currency exchange
losses, net
|
|
|
|
|
|
|
5,467
|
|
Product liability
expense
|
|
|
|
|
|
|
10,857
|
|
Amortization of
acquisition-related intangible assets
|
|
|
|
|
|
|
2,285
|
|
Transaction costs
(a)
|
|
|
|
|
|
|
1,757
|
|
Adjusted operating
income (loss)
|
82,728
|
|
26,249
|
|
(13,172)
|
|
95,805
|
|
Adjusted operating
margin %
|
28.6 %
|
|
17.0 %
|
|
|
|
21.6 %
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
12,149
|
|
Adjusted
EBITDA
|
91,525
|
|
29,471
|
|
(13,042)
|
|
107,954
|
|
Adjusted EBITDA margin
%
|
31.7 %
|
|
19.1 %
|
|
|
|
24.4 %
|
|
|
(a)
Transaction costs include advisory, legal, accounting, valuation,
and other professional or consulting fees incurred during
acquisitions and divestitures. These costs are included in selling,
general and administrative expense in the unaudited Condensed
Consolidated Statements of Income.
|
|
MSA Safety
Incorporated
Segment Information
(Unaudited)
(In thousands, except
percentage amounts)
|
|
|
Americas
|
|
International
|
|
Corporate
|
|
Consolidated
|
|
Twelve Months Ended
December 31, 2023
|
|
|
|
|
|
|
|
|
Net sales to external
customers
|
$
1,235,594
|
|
$
552,053
|
|
$
—
|
|
$
1,787,647
|
|
Operating
income
|
|
|
|
|
|
|
231,320
|
|
Operating margin
%
|
|
|
|
|
|
|
12.9 %
|
|
Restructuring
charges
|
|
|
|
|
|
|
9,892
|
|
Currency exchange
losses, net
|
|
|
|
|
|
|
17,079
|
|
Loss on divestiture of
MSA LLC
|
|
|
|
|
|
|
129,211
|
|
Product liability
expense
|
|
|
|
|
|
|
3
|
|
Amortization of
acquisition-related intangible assets
|
|
|
|
|
|
|
9,246
|
|
Transaction costs
(a)
|
|
|
|
|
|
|
965
|
|
Adjusted operating
income (loss)
|
359,617
|
|
89,699
|
|
(51,600)
|
|
397,716
|
|
Adjusted operating
margin %
|
29.1 %
|
|
16.2 %
|
|
|
|
22.2 %
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
51,527
|
|
Adjusted
EBITDA
|
396,596
|
|
103,404
|
|
(50,757)
|
|
449,243
|
|
Adjusted EBITDA margin
%
|
32.1 %
|
|
18.7 %
|
|
|
|
25.1 %
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended
December 31, 2022
|
|
|
|
|
|
|
|
|
Net sales to external
customers
|
$
1,043,238
|
|
$
484,715
|
|
$
—
|
|
$
1,527,953
|
|
Operating
income
|
|
|
|
|
|
|
239,137
|
|
Operating margin
%
|
|
|
|
|
|
|
15.7 %
|
|
Restructuring
charges
|
|
|
|
|
|
|
7,965
|
|
Currency exchange
losses, net
|
|
|
|
|
|
|
10,255
|
|
Product liability
expense
|
|
|
|
|
|
|
20,590
|
|
Amortization of
acquisition-related intangible assets
|
|
|
|
|
|
|
9,207
|
|
Transaction costs
(a)
|
|
|
|
|
|
|
3,233
|
|
Adjusted operating
income (loss)
|
267,392
|
|
60,923
|
|
(37,928)
|
|
290,387
|
|
Adjusted operating
margin %
|
25.6 %
|
|
12.6 %
|
|
|
|
19.0 %
|
|
Depreciation and
amortization
|
|
|
|
|
|
|
47,110
|
|
Adjusted
EBITDA
|
301,726
|
|
73,179
|
|
(37,408)
|
|
337,497
|
|
Adjusted EBITDA margin
%
|
28.9 %
|
|
15.1 %
|
|
|
|
22.1 %
|
|
|
(a)
Transaction costs include advisory, legal, accounting, valuation,
and other professional or consulting fees incurred during
acquisitions and divestitures. These costs are included in selling,
general and administrative expense in the unaudited Condensed
Consolidated Statements of Income.
|
The Americas segment is comprised of our operations in
North America and Latin America geographies. The International
segment is comprised of our operations in all geographies outside
of the Americas. Certain global expenses are allocated to each
segment in a manner consistent with where the benefits from the
expenses are derived.
Adjusted operating income, adjusted operating margin, adjusted
earnings before interest, taxes, depreciation and amortization
(EBITDA) and adjusted EBITDA margin are the measures used by the
chief operating decision maker to evaluate segment performance and
allocate resources. As such, management believes that adjusted
operating income, adjusted operating margin, adjusted EBITDA and
adjusted EBITDA margin are useful metrics for investors. Adjusted
operating income is defined as operating income excluding
restructuring charges, currency exchange gains / losses, loss on
divestiture of MSA LLC, product liability expense, amortization of
acquisition-related intangible assets, and transaction costs.
Adjusted operating margin is defined as adjusted operating income
divided by segment net sales to external customers. Adjusted EBITDA
is defined as adjusted operating income plus depreciation and
amortization, and adjusted EBITDA margin is defined as adjusted
EBITDA divided by segment net sales to external customers. Adjusted
operating income, adjusted operating margin, adjusted EBITDA and
adjusted EBITDA margin are not recognized terms under GAAP, and
therefore do not purport to be alternatives to operating income or
operating margin as a measure of operating performance. The
company's definition of adjusted operating income, adjusted
operating margin, adjusted EBITDA and adjusted EBITDA margin may
not be comparable to similarly titled measures of other companies.
As such, management believes that it is appropriate to consider
operating income determined on a GAAP basis in addition to these
non-GAAP measures.
|
MSA Safety
Incorporated
Reconciliation of As
Reported Financial Measures to Non-GAAP Financial
Measures
Constant currency
revenue growth (Unaudited)
Consolidated
|
|
|
Three Months Ended
December 31, 2023
|
|
Firefighter
Safety(a)
|
Detection(b)
|
Industrial PPE and
Other(c)
|
|
Net Sales
|
|
GAAP reported sales
change
|
17 %
|
11 %
|
5 %
|
|
12 %
|
|
Plus: Currency
translation effects
|
(1) %
|
(2) %
|
(3) %
|
|
(2) %
|
|
Constant currency sales
change
|
16 %
|
9 %
|
2 %
|
|
10 %
|
|
|
Twelve Months Ended
December 31, 2023
|
|
Firefighter
Safety(a)
|
Detection(b)
|
Industrial PPE and
Other(c)
|
|
Net Sales
|
|
GAAP reported sales
change
|
18 %
|
20 %
|
12 %
|
|
17 %
|
|
Plus: Currency
translation effects
|
— %
|
(1) %
|
(2) %
|
|
(1) %
|
|
Constant currency sales
change
|
18 %
|
19 %
|
10 %
|
|
16 %
|
|
|
(a)
Firefighter Safety includes Breathing Apparatus and Firefighter
Helmets and Protective Apparel.
|
|
(b)
Detection includes Fixed Gas and Flame Detection and Portable Gas
Detection.
|
|
(c)
Industrial PPE and Other includes Industrial Head Protection, Fall
Protection and Non-Core.
|
Management believes that constant currency revenue growth is a
useful metric for investors, as foreign currency translation can
have a material impact on revenue growth trends. Constant currency
revenue growth highlights ongoing business performance excluding
the impact of fluctuating foreign currencies, which is outside of
management's control. There can be no assurances that MSA's
definition of constant currency revenue growth is consistent with
that of other companies. As such, management believes that it is
appropriate to consider revenue growth determined on a GAAP basis
in addition to this non-GAAP financial measure.
|
MSA Safety
Incorporated
Reconciliation of As
Reported Financial Measures to Non-GAAP Financial
Measures
Constant currency
revenue growth (Unaudited)
Americas
Segment
|
|
|
Three Months Ended
December 31, 2023
|
|
Firefighter
Safety(a)
|
Detection(b)
|
Industrial PPE and
Other(c)
|
|
Net Sales
|
|
GAAP reported sales
change
|
22 %
|
15 %
|
4 %
|
|
15 %
|
|
Plus: Currency
translation effects
|
— %
|
(1) %
|
(2) %
|
|
(1) %
|
|
Constant currency sales
change
|
22 %
|
14 %
|
2 %
|
|
14 %
|
|
|
Twelve Months Ended
December 31, 2023
|
|
Firefighter
Safety(a)
|
Detection(b)
|
Industrial PPE and
Other(c)
|
|
Net Sales
|
|
GAAP reported sales
change
|
20 %
|
20 %
|
13 %
|
|
18 %
|
|
Plus: Currency
translation effects
|
— %
|
(1) %
|
(2) %
|
|
(1) %
|
|
Constant currency sales
change
|
20 %
|
19 %
|
11 %
|
|
17 %
|
|
|
(a)
Firefighter Safety includes Breathing Apparatus and Firefighter
Helmets and Protective Apparel.
|
|
(b)
Detection includes Fixed Gas and Flame Detection and Portable Gas
Detection.
|
|
(c)
Industrial PPE and Other includes Industrial Head Protection, Fall
Protection and Non-Core.
|
Management believes that constant currency revenue growth is a
useful metric for investors, as foreign currency translation can
have a material impact on revenue growth trends. Constant currency
revenue growth highlights ongoing business performance excluding
the impact of fluctuating foreign currencies, which is outside of
management's control. There can be no assurances that MSA's
definition of constant currency revenue growth is consistent with
that of other companies. As such, management believes that it is
appropriate to consider revenue growth determined on a GAAP basis
in addition to this non-GAAP financial measure.
|
MSA Safety
Incorporated
Reconciliation of As
Reported Financial Measures to Non-GAAP Financial
Measures
Constant currency
revenue growth (Unaudited)
International
Segment
|
|
|
Three Months Ended
December 31, 2023
|
|
Firefighter
Safety(a)
|
Detection(b)
|
Industrial PPE and
Other(c)
|
|
Net Sales
|
|
GAAP reported sales
change
|
6 %
|
5 %
|
6 %
|
|
6 %
|
|
Plus: Currency
translation effects
|
(4) %
|
(3) %
|
(3) %
|
|
(3) %
|
|
Constant currency sales
change
|
2 %
|
2 %
|
3 %
|
|
3 %
|
|
|
Twelve Months Ended
December 31, 2023
|
|
Firefighter
Safety(a)
|
Detection(b)
|
Industrial PPE and
Other(c)
|
|
Net Sales
|
|
GAAP reported sales
change
|
12 %
|
20 %
|
8 %
|
|
14 %
|
|
Plus: Currency
translation effects
|
(1) %
|
(1) %
|
— %
|
|
(1) %
|
|
Constant currency sales
change
|
11 %
|
19 %
|
8 %
|
|
13 %
|
|
|
(a)
Firefighter Safety includes Breathing Apparatus and Firefighter
Helmets and Protective Apparel.
|
|
(b)
Detection includes Fixed Gas and Flame Detection and Portable Gas
Detection.
|
|
(c)
Industrial PPE and Other includes Industrial Head Protection, Fall
Protection and Non-Core.
|
Management believes that constant currency revenue growth is a
useful metric for investors, as foreign currency translation can
have a material impact on revenue growth trends. Constant currency
revenue growth highlights ongoing business performance excluding
the impact of fluctuating foreign currencies, which is outside of
management's control. There can be no assurances that MSA's
definition of constant currency revenue growth is consistent with
that of other companies. As such, management believes that it is
appropriate to consider revenue growth determined on a GAAP basis
in addition to this non-GAAP financial measure.
|
MSA Safety
Incorporated
Supplemental Segment
Information (Unaudited)
Summary of constant
currency revenue growth by segment and product group
|
|
|
Three Months Ended
December 31, 2023
|
|
Consolidated
|
|
Americas
|
|
International
|
|
Firefighter
Safety
|
16 %
|
|
22 %
|
|
2 %
|
|
Detection
|
9 %
|
|
14 %
|
|
2 %
|
|
Industrial PPE and
Other
|
2 %
|
|
2 %
|
|
3 %
|
|
|
|
|
|
|
|
Net Sales
|
10 %
|
|
14 %
|
|
3 %
|
|
|
|
Twelve Months Ended
December 31, 2023
|
|
Consolidated
|
|
Americas
|
|
International
|
|
Firefighter
Safety
|
18 %
|
|
20 %
|
|
11 %
|
|
Detection
|
19 %
|
|
19 %
|
|
19 %
|
|
Industrial PPE and
Other
|
10 %
|
|
11 %
|
|
8 %
|
|
|
|
|
|
|
|
Net Sales
|
16 %
|
|
17 %
|
|
13 %
|
|
MSA Safety
Incorporated
Reconciliation of As
Reported Financial Measures to Non-GAAP Financial
Measures
Adjusted earnings
(Unaudited)
Adjusted earnings per
diluted share (Unaudited)
(In thousands, except
per share amounts)
|
|
|
Three Months
Ended December
31,
|
|
|
|
Twelve
Months
Ended December
31,
|
|
|
|
2023
|
|
2022
|
|
% Change
|
|
2023
|
|
2022
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable
to
MSA Safety
Incorporated
|
$
76,410
|
|
$
51,489
|
|
48 %
|
|
$
58,583
|
|
$ 179,630
|
|
(67) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on divestiture of
MSA LLC
|
—
|
|
—
|
|
|
|
129,211
|
|
—
|
|
|
|
Deferred tax asset
write-off related to divestiture of MSA LLC
|
—
|
|
—
|
|
|
|
70,366
|
|
—
|
|
|
|
Product liability
expense
|
—
|
|
10,857
|
|
|
|
3
|
|
20,590
|
|
|
|
Restructuring
charges
|
1,510
|
|
4,819
|
|
|
|
9,892
|
|
7,965
|
|
|
|
Transaction costs
(a)
|
887
|
|
1,757
|
|
|
|
965
|
|
3,233
|
|
|
|
Amortization of
acquisition-related intangible assets
|
2,310
|
|
2,285
|
|
|
|
9,246
|
|
9,207
|
|
|
|
Currency exchange
losses, net
|
8,298
|
|
5,467
|
|
|
|
17,079
|
|
10,255
|
|
|
|
Asset related losses
and other
|
844
|
|
1,515
|
|
|
|
173
|
|
6,290
|
|
|
|
Tax benefit associated
with tax reform
|
(5,313)
|
|
—
|
|
|
|
(5,313)
|
|
—
|
|
|
|
Income tax expense on
adjustments
|
(3,409)
|
|
(7,263)
|
|
|
|
(12,657)
|
|
(14,662)
|
|
|
|
Adjusted
earnings
|
$
81,537
|
|
$
70,926
|
|
15 %
|
|
$ 277,548
|
|
$ 222,508
|
|
25 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per
diluted share
|
$ 2.06
|
|
$ 1.80
|
|
14 %
|
|
$ 7.03
|
|
$ 5.65
|
|
24 %
|
|
|
(a)
Transaction costs include advisory, legal, accounting,
valuation, and other professional or consulting fees incurred
during acquisitions and divestitures. These costs are included in
selling, general and administrative expense in the Consolidated
Statements of Income.
|
Management believes that adjusted earnings and adjusted earnings
per diluted share are useful measures for investors, as management
uses these measures to internally assess the Company's performance
and ongoing operating trends. There can be no assurances that
additional special items will not occur in future periods, nor that
MSA's definition of adjusted earnings is consistent with that of
other companies. As such, management believes that it is
appropriate to consider both net income determined on a GAAP basis
as well as adjusted earnings.
|
MSA Safety
Incorporated
Reconciliation of As
Reported Financial Measures to Non-GAAP Financial
Measures
Debt to adjusted EBITDA
/ Net debt to adjusted EBITDA (Unaudited)
(In
thousands)
|
|
|
|
Twelve Months Ended
December 31,
|
|
|
2023
|
|
Operating
income
|
|
$
231,320
|
|
Loss on divestiture of
MSA LLC
|
|
129,211
|
|
Depreciation and
amortization
|
|
51,527
|
|
Product liability
expense
|
|
3
|
|
Restructuring
charges
|
|
9,892
|
|
Currency exchange
losses, net
|
|
17,079
|
|
Amortization of
acquisition-related intangible assets
|
|
9,246
|
|
Transaction costs
(a)
|
|
965
|
|
Adjusted
EBITDA
|
|
$
449,243
|
|
|
|
|
Total end-of-period
debt
|
|
601,692
|
|
|
|
|
Debt to adjusted
EBITDA
|
|
1.3
|
|
|
|
|
Total end-of-period
debt
|
|
601,692
|
|
Total end-of-period
cash and cash equivalents
|
|
146,442
|
|
Net debt
|
|
$
455,250
|
|
|
|
|
Net debt to adjusted
EBITDA
|
|
1.0
|
|
|
(a)
Transaction costs include advisory, legal, accounting, valuation,
and other professional or consulting fees incurred during
acquisitions and divestitures. These costs are included in selling,
general and administrative expense in the Consolidated Statements
of Income.
|
Management believes that Debt to Adjusted EBITDA and Net Debt to
Adjusted EBITDA are useful measures for investors, as management
uses these measures to internally assess the Company's liquidity
and balance sheet strength. There can be no assurances that that
MSA's definition of Debt to Adjusted EBITDA and Net Debt to
Adjusted EBITDA is consistent with that of other companies.
|
MSA Safety
Incorporated
Reconciliation of As
Reported Financial Measures to Non-GAAP Financial
Measures
Adjusted Payments on
Debt (Unaudited)
(In
thousands)
|
|
|
|
Twelve Months Ended
December 31,
|
|
|
2023
|
|
2022
|
|
Change in
debt
|
|
$
23,898
|
|
$
(13,000)
|
|
Borrowings related to
divestiture of MSA LLC (a)
|
|
(312,943)
|
|
$
—
|
|
Adjusted payments on
debt
|
|
$
(289,045)
|
|
$
(13,000)
|
|
|
(a)
Net of foreign exchange and issuance costs
|
Management believes that Adjusted Payments on Debt is a useful
measure for investors, as management uses this measure to
internally assess the Company's debt activity, less the divestiture
of MSA LLC. There can be no assurances that MSA's definition
of Adjusted Payments on Debt is consistent with that of other
companies.
About MSA Safety:
MSA Safety Incorporated (NYSE: MSA) is the global leader in
advanced safety products, technologies and solutions. Driven by its
singular mission of safety, the Company has been at the forefront
of safety innovation since 1914, protecting workers and facility
infrastructure around the world across a broad range of diverse end
markets while creating sustainable value for shareholders. With
2023 revenues of $1.8 billion, MSA Safety is headquartered in
Cranberry Township, Pennsylvania
and employs a team of over 5,000 associates across its more than 40
international locations. For more information, please visit
www.MSASafety.com
Cautionary Statement Regarding Forward-Looking
Statements:
Except for historical information, certain matters discussed
in this press release may be "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements relate to future events or our future
financial performance and involve various assumptions, known and
unknown risks, uncertainties and other factors that may cause our
actual results, levels of activity, performance or achievements to
be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these
forward-looking statements. In some cases, you can identify
forward-looking statements by words such as "may," "will,"
"should," "expects," "intends," "plans," "anticipates," "believes,"
"estimates," "predicts," "potential" or other comparable words.
Actual results, performance or outcomes may differ materially from
those expressed or implied by these forward-looking statements and
may not align with historical performance and events due to a
number of factors, including those discussed in the sections of our
annual report on Form 10-K entitled "Cautionary Statement Regarding
Forward-Looking Statements" and "Risk Factors," and those discussed
in our Form 10-Q quarterly reports filed after such annual report.
MSA's SEC filings are readily obtainable at no charge at
www.sec.gov, as well as on its own investor relations website at
http://investors.MSAsafety.com. Although we believe that the
expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity,
performance or achievements, and caution should be exercised
against placing undue reliance upon such statements. We are under
no duty to update publicly any of the forward-looking statements
after the date of this earnings press release, whether as a result
of new information, future events or otherwise, except as required
by law.
Non-GAAP Financial Measures:
This press release includes certain non-GAAP financial measures.
These financial measures include constant currency revenue growth,
adjusted operating income, adjusted operating margin, adjusted
EBITDA, adjusted EBITDA margin, adjusted earnings, adjusted
earnings per diluted share, debt to adjusted EBITDA, net debt to
adjusted EBITDA, and adjusted payments on debt. These non-GAAP
financial measures provide information useful to investors in
understanding our operating performance and trends, and to
facilitate comparisons with the performance of our peers.
Management also uses these measures internally to assess and better
understand our underlying business performance and trends related
to core business activities. The non-GAAP financial measures and
key performance indicators we use, and computational methods with
respect thereto, may differ from the non-GAAP financial measures
and key performance indicators, and computational methods, that our
peers use to assess their performance and trends.
The presentation of these non-GAAP financial measures does
not comply with U.S. GAAP. These non-GAAP financial measures should
be viewed as supplemental in nature, and not as a substitute for,
or superior to, our reported results prepared in accordance with
GAAP. When non-GAAP financial measures are disclosed, the
Securities and Exchange Commission's Regulation G requires: (i) the
presentation of the most directly comparable financial measure
calculated and presented in accordance with GAAP and (ii) a
reconciliation of the differences between the non-GAAP financial
measure presented and the most directly comparable financial
measure calculated and presented in accordance with
GAAP. The presentation of these financial measures does
not comply with U.S. generally accepted accounting principles
("GAAP"). For an explanation of these measures, with a
reconciliation to the most directly comparable GAAP financial
measure, see the Reconciliation of As Reported Financial Measures
to Non-GAAP Financial Measures in the financial tables section
above.
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SOURCE MSA Safety
