Fortune Brands Delivers Solid Third Quarter Results

Fortune Brands Innovations, Inc. (NYSE: FBIN or “Fortune Brands” or the “Company”), an industry-leading home, security and commercial building products company, today announced third quarter 2023 results.

Highlights:

• Q3 2023 sales were $1.3 billion, an increase of 5 percent over Q3 2022. Organic sales were $1.1 billion, a decrease of 4 percent versus Q3 2022
• Q3 2023 earnings per share (EPS) were $1.07, a decrease of 2 percent versus a year ago; EPS before charges / gains were $1.19, an increase of 3 percent versus Q3 2022
• Company raises mid-point of full-year 2023 non-GAAP EPS guidance
• Company continues to generate strong operating and free cash flow
• Recently acquired brands performing above expectations; integration progressing well

“Our solid sales and margin results reflect the concrete and proactive measures we have taken, which have allowed us to continue outperforming in a tough market, while also accelerating investment in our most critical strategic initiatives,” said Fortune Brands Chief Executive Officer Nicholas Fink. “The actions we took over the past year to better leverage the strength of our organization and sharpen our focus on our leading brands, meaningful innovation, and advantaged channel relationships are driving our results. Fortune Brands Innovations is stronger, more agile, and more aligned than it has ever been. We continue to be confident in our mid- to long-term outlook, which has only been bolstered by the current supply-demand imbalance in the core housing market.”

Third Quarter 2023 Results

($ in millions, except per share amounts; Change compared to prior year)

Unaudited

Total Company Results

	Reported Net Sales	Operating Income	Operating Margin	EPS
Q3 2023 GAAP	$1,261	$196.5	15.6%	$1.07
Change	5%	2%	(50 bps)	(2%)
	Reported Net Sales	Operating Income Before Charges / Gains	Operating Margin Before Charges / Gains	EPS Before Charges / Gains
Q3 2023 Non-GAAP	$1,261	$219.9	17.4%	$1.19
Change	5%	2%	(70 bps)	3%

Segment Results Compared to Prior Year

Water Innovations sales increased primarily due to the Emtek and Schaub acquisition. Water Innovations organic sales decreased due to lower sales volumes. Outdoors sales decreased due to lower sales volumes in the door business. Security sales increased driven by the U.S. and Canadian Yale and August residential smart locks acquisition as well as increased distribution, price and continued growth in the commercial safety and international businesses.

Balance Sheet and Cash Flow

The Company exited the quarter with a strong balance sheet, and due to its strong cash flow, repurchased $30 million of shares in the quarter while also deleveraging following the recent acquisition. As of October 25, 2023, the Company has repurchased $150 million of shares in 2023.

As of the end of the third quarter 2023:

Net debt	$2.4 billion
Net debt to EBITDA before charges / gains	2.6x
Cash	$453.4 million
Amount available under revolving credit facility	$1.09 billion

Annual Outlook

The Company is updating its full-year 2023 guidance to reflect current expectations for 2023.

“Our revised financial guidance continues to reflect our expectation of outperformance, both organically and from our recent acquisitions, as well as the impact from the dynamic external environment,” said Fortune Brands Chief Financial Officer David Barry. “As we position Fortune Brands for future shareholder value creation opportunities, we continue to prioritize above-market sales growth, margin preservation and enhancement and cash generation, and our financial results and expectations reflect our commitment to these priorities.”

For the complete press release, click here.

About Fortune Brands Innovations

Fortune Brands Innovations, Inc. (NYSE: FBIN), headquartered in Deerfield, Ill., is a brand, innovation and channel leader focused on exciting, supercharged categories in the home products, security and commercial building markets. The Company’s growing portfolio of brands includes Moen, House of Rohl, Aqualisa, Emtek, Therma-Tru, Larson, Fiberon, Master Lock, SentrySafe, Yale and August. To learn more about FBIN, its brands and environmental, social and governance (ESG) commitments, visit www.FBIN.com.

Contact:

Leigh Avsec – Media Contact – Investor.Questions@fbhs.com – (847) 484-4211

Source: Fortune Brands Innovations, Inc.