Carlisle Companies Reports Fourth Quarter Results

Carlisle Companies Incorporated announced its fourth quarter 2023 financial results.

• Record 4th quarter results with GAAP diluted EPS of $3.91 and adjusted EPS of $4.17
  • Revenues of $1.1 billion, -1.9% Year over Year (“YoY”)
  • Operating margin of 22.5% and adj EBITDA margin of 26.4% expanded 440 bps YoY
• Repurchased 3.5 million shares for $900 million in the year
• Launched Vision 2030 strategy, including adjusted EPS target of $40
• Signed agreement to sell CIT as final step in pivot to pure play building products portfolio
• 2024 outlook includes mid-single-digit revenue growth and expanding EBITDA margins

Comments from Chris Koch, Chair, President and Chief Executive Officer

“We are pleased to report that Carlisle had a strong finish to 2023 with record 4th quarter adjusted EPS of $4.17, an increase of 29.5% year-over-year, and adjusted EBITDA margin of 26.4% improving 440 basis points year-over-year on 1.9% lower sales. These results were driven by stronger CCM sales and higher profitability at both CCM and CWT supported by favorable weather conditions, solid contractor backlogs, and stronger operating efficiencies. We continue to emphasize a pursuit of flawless execution in our businesses through the Carlisle Operating System (“COS”), providing value to our customers by delivering innovative solutions for the building envelope, and delivering the Carlisle Experience to our customers.

“With our strong finish to 2023 and the end of the past year’s inventory destocking in our channels, our team enters 2024 energized and clearly aligned with our recently launched Vision 2030. The announced sale agreement of our CIT business serves as a critical last step in our successful pivot to a best-in-class pure play building products company. As part of our superior capital allocation philosophy, we made the strategic decision in 2021 to allocate future cash flow and human capital to maximize total returns by focusing on our building products businesses which have consistently delivered the highest returns. With the expected proceeds from the sale, we begin 2024 with an eye toward significant value creation for shareholders and an expectation of delivering another year of superior ROIC in excess of 25%.

“We expect combined benefits from a backlog of roofing projects due to constrained labor and tailwinds from prior-year customer destocking to help mitigate potential macro-economic risks. We have entered 2024 with a positive growth outlook that we believe is reasonable, achievable and fully supported by our Vision 2030 strategic objectives. We are confident that innovation with a focus on energy efficiency and labor-saving solutions puts us on the right path to drive above-market growth and earn a premium price in the marketplace.”

Fourth Quarter 2023

Revenue for the fourth quarter of $1.1 billion decreased 1.9% year-over-year. Organic revenue decreased 2.3% (organic revenue defined as revenue excluding acquired revenues within the last 12 months and the impact of changes in foreign exchange rates versus the U.S. Dollar).

Operating income for the fourth quarter of $253.6 million increased 21.1% from $209.5 million in the fourth quarter of 2022. Income from continuing operations for the fourth quarter of $191.7 million increased 25.3% from $153.0 million in the fourth quarter of 2022. Adjusted EBITDA for the fourth quarter of $297.1 million increased 17.6% from $252.7 million in the fourth quarter of 2022. Adjusted EBITDA improved 440 bps year-over-year.

Diluted earnings per share (“EPS”) from continuing operations for the fourth quarter of $3.91 increased 33.4% from $2.93 in the fourth quarter of 2022. Adjusted EPS for the fourth quarter of $4.17 increased 29.5% from $3.22 in the fourth quarter of 2022 driven by higher margins and share repurchases.

Fourth Quarter 2023 Segment Highlights

Carlisle Construction Materials (“CCM”)

• Revenue of $815.9 million, increased 1.9% (+1.7% organic) year-over-year, driven by favorable weather and the end of channel destocking.
• Operating income was $238.3 million and adjusted EBITDA was $254.9 million, up 11.8% year-over-year, reflecting an adjusted EBITDA margin of 31.2%. The 270 basis points increase was driven by lower costs and leveraging volume via COS.

Carlisle Weatherproofing Technologies (“CWT”)

• Revenue of $311.6 million, declined 10.8% (-11.6% organic) year-over-year primarily due to residential demand weakness, project delays, and the exit of a non core business.
• Operating income was $45.5 million and adjusted EBITDA was $69.3 million, up 54.3% year-over-year reflecting an adjusted EBITDA margin of 22.2%, a 940 basis point increase over the prior year. This increase was driven by strategic sourcing, operating efficiencies gained through targeted restructuring and realized synergies from the Henry acquisition.

Cash Flow

Operating cash flow from continuing operations for the year ended December 31, 2023, was $1.0 billion, an increase of $96.8 million versus the prior year. Free cash flow from continuing operations was $925.9 million, an increase of $144.3 million versus the prior year (defined as cash provided by operating activities less capital expenditures and comprised of continuing operations). This increase was driven by a reduction in working capital uses primarily related to a reduction in inventory.

During the year ended December 31, 2023, we deployed $900.0 million toward share repurchases, including $320.0 million in the current quarter, and paid $160.3 million in cash dividends, including $41.0 million in the current quarter. As of December 31, 2023, we had 7.4 million shares available for repurchase under our share repurchase program. Additionally, on September 1, 2023, we repaid $300.0 million in senior notes. As of December 31, 2023, we had $576.7 million of cash and cash equivalents and $1.0 billion of availability under our revolving credit facility.

For full fourth quarter results click here.

About Carlisle Companies Incorporated

Carlisle Companies Incorporated is a leading supplier of innovative building envelope products and solutions for more energy efficient buildings. Through its building products businesses – Carlisle Construction Materials (“CCM”) and Carlisle Weatherproofing Technologies (“CWT”) – and family of leading brands, Carlisle delivers innovative, labor-reducing and environmentally responsible products and solutions to customers through the Carlisle Experience. Carlisle is committed to generating superior shareholder returns and maintaining a balanced capital deployment approach, including investments in our businesses, strategic acquisitions, share repurchases and continued dividend increases. Leveraging its culture of continuous improvement as embodied in the Carlisle Operating System (“COS”), Carlisle has committed to achieving net-zero greenhouse gas emissions by 2050.

Contact:

Mehul Patel – Vice President, Investor Relations – mpatel@carlisle.com – (310) 592-9668

Source: Carlisle Companies Incorporated