- Expands Owens Corning’s leadership position in branded
residential products with a complementary line of innovative
interior and exterior doors and door systems
- Creates a scalable new growth platform leveraging combined
commercial, operational, and innovation capabilities
- Enhances Owens Corning’s attractive financial profile
- Generates strong free cash flow to support consistent capital
allocation strategy
- Names Chris Ball President of Doors business
Owens Corning (NYSE: OC) today announced it has completed its
acquisition of Masonite International Corporation (“Masonite”), a
leading global provider of interior and exterior doors and door
systems. All outstanding Masonite common shares have been acquired
by Owens Corning for $133.00 per share, with an implied transaction
value of approximately $3.9 billion.
“The addition of Masonite to Owens Corning marks a significant
milestone for our company, as we further strengthen our position as
a market leader in building and construction materials,” said Brian
Chambers, Chair and Chief Executive Officer of Owens Corning. “Over
the past several years, Owens Corning has been on a journey to
transform and grow our company through strategic choices and strong
execution. The completion of this acquisition represents the start
of an exciting next chapter that allows us to leverage our proven
commercial, operational, and innovation capabilities to increase
our offering of highly valued branded building materials for our
customers. We are excited about expanding into this new growth
platform and for the opportunities ahead.”
Founded in 1925, Masonite is a leading global provider of
interior and exterior doors and door systems serving both repair
and remodel and new construction demand. Masonite operates 64
manufacturing and distribution facilities, primarily in North
America, and has over 10,000 employees globally.
With the completion of the acquisition, Owens Corning’s annual
revenue grows to $12.5 billion, with adjusted EBITDA of $2.9
billion on a synergized basis1 and reduced ongoing capital
intensity. Owens Corning expects to achieve approximately $125
million of run-rate cost synergies. The acquisition drives
meaningful shareholder value creation with ROIC exceeding Owens
Corning’s cost of capital by the end of Year 3 post-close.
Masonite shareholders voted to approve the transaction at the
Special Meeting of Shareholders held on April 25, 2024. With the
completion of the acquisition, Masonite’s common shares will cease
trading on the New York Stock Exchange and will be delisted.
Doors Business President Named
Owens Corning has named Chris Ball as President of its Doors
business. Ball previously served as President of Masonite’s Global
Residential business. He will report directly to Chair and Chief
Executive Officer Brian Chambers and serve as a member of the
company’s Executive Committee.
“We are pleased to welcome Chris to the Owens Corning executive
team. His proven track record of growing businesses and developing
talent, as well as his strong commercial execution, operational
knowledge, and customer focus, will be instrumental as he leads
this business into the future,” said Chambers. “Today we are
combining two highly talented teams with a shared focus on keeping
each other safe, helping our customers win and grow in the market,
and delivering value for our shareholders. We look forward to
working together with Chris and all of our new colleagues from
Masonite.”
Ball joined Masonite as President of its Global Residential
business in September 2021. Previously he held leadership roles at
several Fortune 500 companies. He was President of the Americas for
Cooper Tire & Rubber Company, where he led the North America,
Latin America, and Global Commercial Truck Tire business units. He
joined Cooper Tire from Whirlpool Corporation, where he served in
various roles including Global Vice President for the company’s
KitchenAid small appliance business and General Manager of the
North America Laundry unit, Whirlpool’s largest business. He has
also worked in sales leadership roles for General Mills, Inc.
He holds a bachelor’s degree from Indiana University’s Kelley
School of Business and a Master of Business Administration from the
executive master’s program at Northwestern University’s Kellogg
School of Management.
About Owens Corning
Owens Corning is a global building and construction materials
leader committed to building a sustainable future through material
innovation. Our four integrated businesses – Roofing, Insulation,
Doors, and Composites – provide durable, sustainable,
energy-efficient solutions that leverage our unique material
science, manufacturing, and market knowledge to help our customers
win and grow. We are global in scope, human in scale with more than
25,000 employees in 31 countries dedicated to generating value for
our customers and shareholders, and making a difference in the
communities where we work and live. Founded in 1938 and based in
Toledo, Ohio, USA, Owens Corning posted 2023 sales of $9.7 billion.
For more information, visit www.owenscorning.com.
Use of Non-GAAP Measures
Owens Corning uses non-GAAP measures that are intended to
supplement investors' understanding of the company's financial
information. These non-GAAP measures include adjusted EBITDA. A
reconciliation for adjusted EBITDA to the corresponding GAAP
measures are included in the financial tables of this press
release. For purposes of internal review of Owens Corning's
year-over-year operational performance, management excludes from
net earnings attributable to Owens Corning certain items it
believes are not representative of ongoing operations. The non-GAAP
financial measures resulting from these adjustments (including
adjusted EBITDA) are used internally by Owens Corning for various
purposes, including reporting results of operations to the Board of
Directors, analysis of performance, and related employee
compensation measures. Management believes that these adjustments
result in a measure that provides a useful representation of its
operational performance; however, the adjusted measures should not
be considered in isolation or as a substitute for net earnings
attributable to Owens Corning as prepared in accordance with
GAAP.
Forward-Looking
Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. These forward-looking
statements are subject to risks, uncertainties and other factors
and actual results may differ materially from any results projected
in the statements. These risks, uncertainties and other factors
include, without limitation: levels of residential and commercial
or industrial construction activity; demand for our products;
industry and economic conditions including, but not limited to,
supply chain disruptions, recessionary conditions, inflationary
pressures, interest rate and financial markets volatility, and the
viability of banks and other financial institutions; availability
and cost of energy and raw materials; levels of global industrial
production; competitive and pricing factors; relationships with key
customers and customer concentration in certain areas; issues
related to acquisitions, divestitures and joint ventures or
expansions; climate change, weather conditions and storm activity;
legislation and related regulations or interpretations, in the
United States or elsewhere; domestic and international economic and
political conditions, policies or other governmental actions, as
well as war and civil disturbance; changes to tariff, trade or
investment policies or laws; uninsured losses, including those from
natural disasters, catastrophes, pandemics, theft or sabotage;
environmental, product-related or other legal and regulatory
liabilities, proceedings or actions; research and development
activities and intellectual property protection; issues involving
implementation and protection of information technology systems;
foreign exchange and commodity price fluctuations; our level of
indebtedness; our liquidity and the availability and cost of
credit; our ability to achieve expected synergies, cost reductions
and/or productivity improvements; the level of fixed costs required
to run our business; levels of goodwill or other indefinite-lived
intangible assets; price volatility in certain wind energy markets
in the U.S.; loss of key employees and labor disputes or shortages;
our ability to successfully integrate Masonite; any material
adverse changes in the business of Masonite; our ability to achieve
the strategic and other objectives relating to the Masonite
acquisition, including any expected synergies; the strategic review
of our Glass Reinforcements business; defined benefit plan funding
obligations; and factors detailed from time to time in the
company’s Securities and Exchange Commission filings. The
information in this news release speaks as of May 15, 2024, and is
subject to change. The company does not undertake any duty to
update or revise forward-looking statements except as required by
federal securities laws. Any distribution of this news release
after that date is not intended and should not be construed as
updating or confirming such information.
1Based on 2023 actual results plus $125mm run-rate synergies and
excludes costs to achieve synergies.
Table 1
The reconciliation from Net earnings attributable to Owens
Corning to EBITDA and Adjusted EBITDA for 2023 is shown in the
table below (in millions):
Year Ended
December 31, 2023
NET EARNINGS ATTRIBUTABLE TO OWENS
CORNING
$
1,196
Net loss attributable to non-redeemable
and redeemable non-controlling interests
(3
)
NET EARNINGS
1,193
Equity in net earnings of affiliates
3
Income tax expense
401
EARNINGS BEFORE TAXES
1,591
Interest expense, net
76
EARNINGS BEFORE INTEREST AND TAXES
1,667
Depreciation and amortization
609
EARNINGS BEFORE INTEREST, TAXES,
DEPRECIATION AND AMORTIZATION (EBITDA)
2,276
Less: Adjusting items (below)
(138
)
Accelerated depreciation and amortization
included in restructuring
(101
)
ADJUSTED EBITDA
$
2,313
ADJUSTING ITEMS TO EBITDA
Restructuring costs
$
(169
)
Pension settlement losses
(145
)
Paroc marine recall
(15
)
Gains on asset sales
191
TOTAL ADJUSTING ITEMS (a)
$
(138
)
(a) Please refer to the 2023 10-K filing
in the "Adjusted Earnings Before Interest and Taxes ("Adjusted
EBIT") paragraph of Management's Discussion and Analysis for
additional information on these adjusting items.
Source: Owens Corning SEC Filings; Annual
Report on Form 10-K for the year ended December 31, 2023 filed on
February 14, 2024.
Table 2
The reconciliation from Net income attributable to Masonite
International Corporation ("Masonite") to adjusted EBITDA (in
thousands):
Year Ended
December 31, 2023
Net income attributable to Masonite
$
118,227
Plus:
Depreciation
91,145
Amortization
32,976
Share based compensation expense
23,638
Loss on disposal of property, plant and
equipment
4,434
Restructuring costs
10,130
Asset impairment
33,063
Interest expense, net
50,822
Other income, net
(2,087
)
Income tax expense
40,941
Other items (a)
12,311
Net income attributable to non-controlling
interest
3,042
Adjusted EBITDA
$
418,642
(a) In 2023, other items include $12,311
in acquisition and due diligence related costs and legal costs
related to the settlement of Canada class action litigation in the
twelve months ended December 31, 2023, and were recorded in
selling, general and administration expenses within the
consolidated statements of income and comprehensive income.
Source: Masonite SEC Filings; Annual
Report on Form 10-K for the year ended December 31, 2023 filed on
February 29, 2024.
Table 3
The following table combines Owens Corning and Masonite EBITDA;
inclusive of projected synergies (in millions):
Year Ended
December 31, 2023
Owens Corning
+
Masonite
+
Synergies (a)
=
Combined
Net Sales
$9,677
$2,831
—
$12,508
Adjusted EBITDA
$2,313
$419
$125
$2,857
(a) Owens Corning projects to achieve
approximately $125 million of run-rate cost synergies.
Please see Table 1 for the reconciliation
from Net earnings attributable to Owens Corning to EBITDA and
Adjusted EBITDA and Table 2 for the reconciliation from Net income
attributable to Masonite to Adjusted EBITDA.
Source: Owens Corning SEC Filings; Annual
Report on Form 10-K for the years ended December 31, 2023 filed on
February 14, 2024; Masonite SEC Filings; Annual Report on Form 10-K
for the year ended December 31, 2023 filed on February 29,
2024.
Owens Corning Company News / Owens Corning Investor Relations
News
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version on businesswire.com: https://www.businesswire.com/news/home/20240514879383/en/
Owens Corning
Megan James Media Relations megan.james@owenscorning.com
419.348.0768
Amber Wohlfarth Investor Relations
amber.wohlfarth@owenscorning.com 419.248.5639
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