Net sales decreased 18% in Q3-2022 as compared
to Q3-2021 driven by the mild North
America fire season
Fire Safety Q3 Adjusted EBITDA of $60.4 million; Specialty Products Q3 Adjusted
EBITDA of $15.3 million
Year-to-date net income of $123.7 million and consolidated Adjusted EBITDA
of $123.3 million
New $100.0
million share repurchase authorization *
CLAYTON,
Mo., Nov. 4, 2022 /PRNewswire/ -- Perimeter
Solutions, SA (NYSE: PRM) ("Perimeter" or the "Company"), a leading
provider of mission-critical firefighting products and services, as
well as specialty products used in several end markets, today
reported financial results for the three and nine months ended
September 30, 2022.
Year-to-Date 2022
Results
|
- Net sales increased 1% to $319.2 million
during the year-to-date period, as compared to $316.5 million in
the prior-year period.
|
|
-
-
- Fire Safety sales decreased 13% to $207.0
million, as compared to $237.3 million in the prior year.
|
|
-
-
- Specialty Products sales increased 42% to
$112.2 million, as compared to $79.2 million in the prior
year.
|
|
- Net income during the year-to-date period was
$123.7 million, or $0.70 per diluted share, an increase of $94.1
million from $29.6 million, or $0.56 per diluted share, for the
same period of 2021.
|
|
- Adjusted EBITDA decreased 8% to $123.3
million during the year-to-date period, as compared to $134.6
million in the prior-year period.
|
|
-
-
- Fire Safety Adjusted EBITDA decreased 30% to
$81.2 million, as compared to $116.7 million in the prior
year.
|
|
-
-
- Specialty Products Adjusted EBITDA increased
135% to $42.0 million, as compared to $17.9 million in the prior
year.
|
Third Quarter 2022
Results
|
- Net sales decreased 18% to $160.5 million in
the third quarter, as compared to $195.4 million in the prior-year
quarter.
|
|
-
-
- Fire Safety sales decreased 29% to $122.0
million, as compared to $172.4 million in the prior year.
|
|
-
-
- Specialty Products sales increased 68% to
$38.5 million, as compared to $23.0 million in the prior year.
|
|
- Net income during the third quarter was $78.7
million, or $0.45 per diluted share, an increase of $26.7 million
from $52.0 million, or $0.98 per diluted share, for the same period
of 2021.
|
|
- Adjusted EBITDA decreased 25% to $75.6
million in the third quarter, as compared to $100.4 million in the
prior-year quarter.
|
|
-
-
- Fire Safety Adjusted EBITDA decreased 38% to
$60.4 million, as compared to $97.9 million in the prior year.
|
|
-
-
- Specialty Products Adjusted EBITDA increased
512% to $15.3 million, as compared to $2.5 million in the prior
year.
|
|
|
|
|
|
|
*
|
On November 3, 2022,
the Company's board of directors approved the repurchase of up to
$100.0 million of the Company's ordinary shares during the next 24
months.
|
Conference Call and
Webcast
As previously announced, Perimeter Solutions management will
hold a conference call at 8:30 a.m. ET on Friday, November 4, 2022 to discuss financial
results for the third quarter 2022. The conference call can be
accessed by dialing (877) 407-9764 (toll-free) or (201) 689-8551
(toll).
The conference call will also be webcast simultaneously on
Perimeter's website (https://ir.perimeter-solutions.com/), accessed
under the Investor Relations page. The webcast link will be made
available on the Company's website prior to the start of the call;
go to the investor relations page of our website to the News &
Events menu and click on "Events & Presentations."
A slide presentation will also be available for reference
during the conference call; go to the investor relations page of
our website to the News & Events menu and click on "Events
& Presentations."
Following the live webcast, a replay will be available on the
Company's website. A telephonic replay will also be available
approximately two hours after the call and can be accessed by
dialing (877) 660-6853 (toll-free) or (201) 612-7415 (toll). The
telephonic replay will be available until December 4, 2022.
About Perimeter
Solutions
Perimeter Solutions is a leading global solutions provider,
providing high-quality firefighting products and specialty products
used in several end markets. The Company's business is organized
and managed in two reporting segments: Fire Safety and Specialty
Products, formerly Oil Additives.
The Fire Safety segment consists of formulating, manufacture and
sale of fire retardants and firefighting foams that assist in
combating various types of fires, including wildland, structural,
flammable liquids and others. Our Fire Safety segment also offers
specialized equipment and services, typically in conjunction with
our fire management products, to support our customers'
firefighting operations. Our specialized equipment includes airbase
retardant storage, mixing, and delivery equipment; mobile retardant
bases; retardant ground application units; mobile foam equipment;
and equipment that we custom design and manufacture to meet
specific customer needs. Our service network can meet the emergency
resupply needs of over 150 air tanker bases in North America, as well as many other customer
locations in North America and
internationally. The segment is built on the premise of superior
technology, exceptional responsiveness to our customers' needs, and
a "never-fail" service network. The segment sells products to
government agencies and commercial customers around the world.
In June 2022, the Oil Additives
segment, which produces and sells Phosphorus Pentasulfide
("P2S5"), was renamed the Specialty Products
segment to better reflect the current and expanding applications
for P2S5 in several end markets and
applications, including lubricant additives, various agricultural
applications, various mining applications, and emerging electric
battery technologies. Within the lubricant additive end market,
currently our largest end market application,
P2S5 is primarily used in the production of a
family of compounds called Zinc Dialkyldithiophosphates ("ZDDP"),
which is considered an essential component in the formulation of
engine oils with its main function to provide anti-wear protection
to engine components.
Forward-looking
Information
This press release may contain "forward-looking statements"
within the meaning of the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995. Forward-looking
statements involve risks and uncertainties that could cause actual
results to differ materially from those in the forward-looking
statements. Forward-looking statements can be identified by
words such as: "anticipate," "intend," "plan," "goal," "seek,"
"believe," "project," "estimate," "expect," "strategy," "future,"
"likely," "may," "should," "will" and similar references to future
periods.
Any such forward-looking statements are not guarantees of
performance or results, and involve risks, uncertainties (some of
which are beyond the Company's control) and assumptions. Although
Perimeter believes any forward-looking statements are based on
reasonable assumptions, you should be aware that many factors could
affect Perimeter's actual financial results and cause them to
differ materially from those anticipated in any forward-looking
statements, including the risk factors described from time to time
by us in our filings with the Securities and Exchange Commission
("SEC"), including, but not limited to, the Company's Annual Report
on Form 10-K for the year ended December 31,
2021 filed with the SEC on March 31,
2022. Shareholders, potential investors and other readers
should consider these factors carefully in evaluating the
forward-looking statements.
Any forward-looking statement made by Perimeter in this press
release speaks only as of the date on which it is made. Perimeter
undertakes no obligation to update any forward-looking statement,
whether as a result of new information, future developments or
otherwise, except as may be required by law.
CONTACT:
ir@perimeter-solutions.com
|
PERIMETER
SOLUTIONS, SA AND SUBSIDIARIES
Condensed
Consolidated Statements of Operations and Comprehensive Income
(Loss)
(in thousands, except share and per share
data)
(Unaudited)
|
|
|
Successor
|
|
|
Predecessor
|
|
Successor
|
|
|
Predecessor
|
|
Three Months
Ended
September 30, 2022
|
|
|
Three Months
Ended
September 30, 2021
|
|
Nine Months
Ended
September 30, 2022
|
|
|
Nine Months
Ended
September 30, 2021
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
160,509
|
|
|
$
195,414
|
|
$
319,232
|
|
|
$
316,460
|
|
Cost of goods
sold
|
74,707
|
|
|
86,081
|
|
191,757
|
|
|
159,895
|
|
Gross
profit
|
85,802
|
|
|
109,333
|
|
127,475
|
|
|
156,565
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expense
|
22,381
|
|
|
15,333
|
|
64,803
|
|
|
42,544
|
|
Amortization
expense
|
13,738
|
|
|
13,276
|
|
41,395
|
|
|
39,818
|
|
Founders advisory fees
- related party
|
(73,713)
|
|
|
—
|
|
(154,026)
|
|
|
—
|
|
Other operating
expense
|
(51)
|
|
|
313
|
|
405
|
|
|
1,066
|
|
Total operating
expenses
|
(37,645)
|
|
|
28,922
|
|
(47,423)
|
|
|
83,428
|
|
Operating
income
|
123,447
|
|
|
80,411
|
|
174,898
|
|
|
73,137
|
|
Other expense
(income):
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
9,944
|
|
|
8,065
|
|
32,582
|
|
|
23,951
|
|
(Gain) loss on
contingent earn-out
|
(3,644)
|
|
|
—
|
|
(13,042)
|
|
|
2,763
|
|
Unrealized foreign
currency loss
|
4,705
|
|
|
1,634
|
|
8,741
|
|
|
3,892
|
|
Other (income)
expense, net
|
(785)
|
|
|
66
|
|
(820)
|
|
|
(252)
|
|
Total other expense,
net
|
10,220
|
|
|
9,765
|
|
27,461
|
|
|
30,354
|
|
Income before income
taxes
|
113,227
|
|
|
70,646
|
|
147,437
|
|
|
42,783
|
|
Income tax
expense
|
(34,516)
|
|
|
(18,637)
|
|
(23,692)
|
|
|
(13,151)
|
|
Net income
|
78,711
|
|
|
52,009
|
|
123,745
|
|
|
29,632
|
|
Other comprehensive
loss, net of tax:
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
(18,181)
|
|
|
(2,020)
|
|
(34,426)
|
|
|
(2,424)
|
|
Total comprehensive
income
|
$
60,530
|
|
|
$
49,989
|
|
$
89,319
|
|
|
$
27,208
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
0.48
|
|
|
$
0.98
|
|
$
0.76
|
|
|
$
0.56
|
|
Diluted
|
$
0.45
|
|
|
$
0.98
|
|
$
0.70
|
|
|
$
0.56
|
|
Weighted average number
of ordinary shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
162,635,592
|
|
|
53,045,510
|
|
161,943,492
|
|
|
53,045,510
|
|
Diluted
|
176,777,958
|
|
|
53,045,510
|
|
176,085,858
|
|
|
53,045,510
|
|
PERIMETER
SOLUTIONS, SA AND SUBSIDIARIES
Condensed
Consolidated Balance Sheets
(in thousands, except share
and per share data)
|
|
|
September 30,
2022
|
|
December 31,
2021
|
|
Assets
|
(Unaudited)
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
166,256
|
|
$
225,554
|
|
Accounts receivable,
net
|
85,612
|
|
24,319
|
|
Inventories
|
120,467
|
|
110,087
|
|
Income tax
receivable
|
655
|
|
816
|
|
Prepaid expenses and
other current assets
|
4,876
|
|
14,161
|
|
Total current
assets
|
377,866
|
|
374,937
|
|
Property, plant, and
equipment, net
|
57,187
|
|
62,247
|
|
Goodwill
|
1,019,387
|
|
1,041,325
|
|
Customer lists,
net
|
715,829
|
|
753,459
|
|
Technology and patents,
net
|
233,861
|
|
247,368
|
|
Tradenames,
net
|
95,047
|
|
100,005
|
|
Other assets,
net
|
1,877
|
|
2,219
|
|
Total
assets
|
$ 2,501,054
|
|
$ 2,581,560
|
|
Liabilities and
Shareholders Equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
31,856
|
|
$
27,469
|
|
Accrued expenses and
other current liabilities
|
124,429
|
|
19,025
|
|
Founders advisory fees
payable - related party
|
9,836
|
|
53,547
|
|
Deferred
revenue
|
1,272
|
|
445
|
|
Total current
liabilities
|
167,393
|
|
100,486
|
|
Long-term
debt
|
664,986
|
|
664,128
|
|
Deferred income
taxes
|
222,952
|
|
298,633
|
|
Founders advisory fees
payable - related party
|
134,598
|
|
312,242
|
|
Redeemable preferred
shares
|
100,263
|
|
96,867
|
|
Redeemable preferred
shares - related party
|
3,245
|
|
3,699
|
|
Other non-current
liabilities
|
8,951
|
|
22,195
|
|
Total
liabilities
|
1,302,388
|
|
1,498,250
|
|
Commitments and
contingencies
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
Ordinary shares, $1
nominal value per share; 4,000,000,000 shares authorized;
163,234,542 and 157,237,435 shares issued; 162,316,326 and
157,237,435 shares outstanding at September 30, 2022 and
December 31, 2021, respectively
|
163,235
|
|
157,237
|
|
Treasury shares, at
cost; 918,216 shares at September 30, 2022 and no shares at
December 31, 2021
|
(7,572)
|
|
—
|
|
Additional paid-in
capital
|
1,697,644
|
|
1,670,033
|
|
Accumulated other
comprehensive loss
|
(41,561)
|
|
(7,135)
|
|
Accumulated
deficit
|
(613,080)
|
|
(736,825)
|
|
Total shareholders'
equity
|
1,198,666
|
|
1,083,310
|
|
Total liabilities and
shareholders' equity
|
$ 2,501,054
|
|
$ 2,581,560
|
|
PERIMETER
SOLUTIONS, SA AND SUBSIDIARIES
Condensed
Consolidated Statements of Cash Flows
(in
thousands)
(Unaudited)
|
|
|
Successor
|
|
|
Predecessor
|
|
Nine Months
Ended
September 30, 2022
|
|
|
Nine Months
Ended
September 30, 2021
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
Net income
|
$
123,745
|
|
|
$
29,632
|
|
Adjustments to
reconcile net income to net cash (used in) provided by operating
activities:
|
|
|
|
|
|
Founders advisory fees
- related party (change in accounting fair value)
|
(154,026)
|
|
|
—
|
|
Depreciation and
amortization expense
|
49,536
|
|
|
45,593
|
|
Interest and
payment-in-kind on preferred shares
|
4,903
|
|
|
—
|
|
Share-based
compensation
|
19,297
|
|
|
—
|
|
Deferred income
taxes
|
(72,441)
|
|
|
(5,195)
|
|
Amortization of
deferred financing costs
|
1,196
|
|
|
2,432
|
|
Amortization of
acquisition related inventory step-up
|
27,973
|
|
|
—
|
|
(Gain) loss on
contingent earn-out
|
(13,042)
|
|
|
2,763
|
|
Unrealized loss on
foreign currency
|
8,741
|
|
|
3,892
|
|
Loss on disposal of
assets
|
9
|
|
|
—
|
|
Changes in operating
assets and liabilities, net of acquisitions:
|
|
|
|
|
|
Accounts
receivable
|
(63,838)
|
|
|
(72,103)
|
|
Inventories
|
(40,759)
|
|
|
(5,554)
|
|
Prepaid expenses and
other current assets
|
9,058
|
|
|
3,104
|
|
Other
assets
|
—
|
|
|
346
|
|
Accounts
payable
|
4,975
|
|
|
12,971
|
|
Deferred
revenue
|
889
|
|
|
831
|
|
Income taxes payable,
net
|
88,673
|
|
|
11,180
|
|
Accrued expenses and
other current liabilities
|
15,547
|
|
|
2,725
|
|
Founders advisory fees
- related party (cash settled)
|
(53,547)
|
|
|
—
|
|
Other
liabilities
|
(73)
|
|
|
(200)
|
|
Net cash (used in)
provided by operating activities
|
(43,184)
|
|
|
32,417
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
Purchase of property
and equipment
|
(6,024)
|
|
|
(5,149)
|
|
Purchase price
adjustment under Business Combination Agreement
|
(1,638)
|
|
|
—
|
|
Purchase of
businesses, net of cash acquired
|
—
|
|
|
(7,464)
|
|
Net cash used in
investing activities
|
(7,662)
|
|
|
(12,613)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
Ordinary shares
repurchased
|
(7,572)
|
|
|
—
|
|
Proceeds from exercise
of warrants
|
529
|
|
|
—
|
|
Proceeds from
revolving credit facility
|
—
|
|
|
19,500
|
|
Repayments of
revolving credit facility
|
—
|
|
|
(19,500)
|
|
Repayments of
long-term debt
|
—
|
|
|
(4,211)
|
|
Net cash used in
financing activities
|
(7,043)
|
|
|
(4,211)
|
|
Effect of foreign
currency on cash and cash equivalents
|
(1,409)
|
|
|
1,510
|
|
Net change in cash and
cash equivalents
|
(59,298)
|
|
|
17,103
|
|
Cash and cash
equivalents, beginning of period
|
225,554
|
|
|
22,478
|
|
Cash and cash
equivalents, end of period
|
$
166,256
|
|
|
$
39,581
|
|
Supplemental
disclosures of cash flow information:
|
|
|
|
|
|
Cash paid for
interest
|
$
18,299
|
|
|
$
21,502
|
|
Cash paid for income
taxes
|
$
7,588
|
|
|
$
7,092
|
|
Non-cash investing
and financing activities:
|
|
|
|
|
|
Liability portion of
founders advisory fees - related party reclassified to additional
paid in capital
|
$
13,783
|
|
|
$
—
|
Non-GAAP Financial
Metrics
Adjusted EBITDA
The computation of Adjusted EBITDA is
defined as net income plus income tax expense, net interest and
other financing expenses, and depreciation and amortization,
adjusted on a consistent basis for certain non-recurring, unusual
or non-operational items in a balanced manner. These items include
(i) expenses related to the Business Combination, (ii) founder
advisory fee expenses, (iii) stock compensation expense, (iv)
non-cash impact of purchase accounting on the cost of inventory
sold, (v) contingent future payment related to an acquired
business, (vi) management fees related to the services provided by
SK Capital Partners IV-A, L.P. and SK Capital Partners IV-B, L.P
(collectively, the "Sponsor") when acting in a management capacity
and (vii) unrealized foreign currency loss (gain). To supplement
the Company's consolidated financial statements presented in
accordance with U.S. GAAP, Perimeter is providing a summary to show
the computations of Adjusted EBITDA, which is a non-U.S.GAAP
measure used by the Company's management and by external users of
Perimeter's financial statements, such as investors, commercial
banks and others, to assess the Company's operating performance as
compared to that of other companies, without regard to financing
methods, capital structure or historical cost basis. Adjusted
EBITDA should not be considered an alternative to net income
(loss), operating income (loss), cash flows provided by (used in)
operating activities or any other measure of financial performance
or liquidity presented in accordance with U.S. GAAP (in
thousands).
|
Successor
|
|
|
Predecessor
|
|
Successor
|
|
|
Predecessor
|
|
(Unaudited)
|
Three Months
Ended
September 30, 2022
|
|
|
Three Months
Ended
September 30, 2021
|
|
Nine Months
Ended
September 30, 2022
|
|
|
Nine Months
Ended
September 30, 2021
|
|
Income before income
taxes
|
$
113,227
|
|
|
$
70,646
|
|
$
147,437
|
|
|
$
42,783
|
|
Depreciation and
amortization
|
16,450
|
|
|
15,212
|
|
49,536
|
|
|
45,593
|
|
Interest and financing
expense
|
9,944
|
|
|
8,065
|
|
32,582
|
|
|
23,951
|
|
Founders advisory fees
- related party
|
(73,713)
|
|
|
—
|
|
(154,026)
|
|
|
—
|
|
Non-recurring expenses
1
|
1,168
|
|
|
3,855
|
|
4,788
|
|
|
12,805
|
|
Share-based
compensation expense
|
6,832
|
|
|
—
|
|
19,297
|
|
|
—
|
|
Non-cash purchase
accounting impact 2
|
658
|
|
|
—
|
|
27,973
|
|
|
—
|
|
(Gain) loss on
contingent earn-out
|
(3,644)
|
|
|
—
|
|
(13,042)
|
|
|
2,763
|
|
Management fees
3
|
—
|
|
|
313
|
|
—
|
|
|
937
|
|
Contingent future
payments 4
|
—
|
|
|
625
|
|
—
|
|
|
1,875
|
|
Unrealized foreign
currency loss
|
4,705
|
|
|
1,634
|
|
8,741
|
|
|
3,892
|
|
Adjusted
EBITDA
|
$
75,627
|
|
|
$
100,350
|
|
$
123,286
|
|
|
$
134,599
|
|
Net sales
|
$
160,509
|
|
|
$
195,414
|
|
$
319,232
|
|
|
$
316,460
|
|
|
|
|
|
|
(1)
|
Adjustment to reflect
non-recurring professional fees and integration costs including
expenses related to the business combination with Perimeter
Solutions.
|
|
(2)
|
Represents the non-cash
impact of purchase accounting on the cost of inventory sold in
connection with the business combination with Perimeter Solutions.
The inventory acquired received a purchase accounting step-up in
basis, which is a non-cash adjustment to the cost.
|
|
(3)
|
Adjustment to reflect
fees pertaining to services provided by the Sponsor when acting in
a management capacity on strategic and other non-operational
matters which do not represent expenses incurred in the normal
course of our operations. These fees did not continue following the
closing of the business combination.
|
|
(4)
|
Adjustment to reflect
deferred consideration paid with respect to a 2019
acquisition.
|
View original
content:https://www.prnewswire.com/news-releases/perimeter-solutions-reports-third-quarter-2022-financial-results-301668822.html
SOURCE Perimeter Solutions