0000920371false00009203712024-10-212024-10-21

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
  
Date of Report (Date of earliest event reported): October 21, 2024
 
  
 
Simpson Manufacturing Co., Inc. 
(Exact name of registrant as specified in its charter)
  
 
 
Delaware 1-13429 94-3196943
(State or other jurisdiction of incorporation) (Commission file number) (I.R.S. Employer Identification No.)
 
  
 
5956 W. Las Positas Boulevard, Pleasanton, CA 94588

 (Address of principal executive offices)
 
 
(Registrant’s telephone number, including area code): (925) 560-9000
 
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Common Stock, par value $0.01 per shareSSDNew York Stock Exchange

 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-2)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240. 13e-4(c))
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐




Item 2.02 Results of Operations and Financial Condition.
 
    On October 21, 2024, Simpson Manufacturing Co., Inc. issued a press release announcing financial results for the quarter ended September 30, 2024, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by this reference.

    This information is furnished pursuant to Item 2.02 and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits
Exhibit No.Description
99.1
104Cover Page Interactive Data File (embedded within the XBRL document)



SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
  
 
  Simpson Manufacturing Co., Inc.
        (Registrant)
    
    
    
DATE:October 21, 2024By/s/ Brian J. Magstadt
   Brian J. Magstadt
   Chief Financial Officer
 
 
 

2

Exhibit 99.1        Press Release dated October 21, 2024

SIMPSON MANUFACTURING CO., INC. ANNOUNCES 2024 THIRD QUARTER FINANCIAL RESULTS

l

Net sales of $587.2 million, increased 1.2% year-over-year
l

Income from operations of $124.9 million, resulting in operating income margin of 21.3%
l

Net income per diluted share of $2.21
l

Revising full year 2024 outlook based on reduced housing start expectations

Pleasanton, CA - October 21, 2024 Simpson Manufacturing Co., Inc. (the “Company”) (NYSE: SSD), an industry leader in engineered structural connectors and building solutions, today announced its financial results for the third quarter of 2024. All comparisons below (which are generally indicated by words such as “increased,” “decreased,” “remained,” or “compared to”), unless otherwise noted, are comparing the quarter ended September 30, 2024, with the quarter ended September 30, 2023.

Consolidated 2024 Third Quarter Highlights

Three Months Ended,
Year-Over-
September 30,
Year

20242023Change
(In thousands, except per share data and percentages)
Net sales
$587,153 $580,084 1.2 %
Gross profit
275,057 282,917 (2.8)%
Gross profit margin
46.8 %48.8 %
Total operating expenses
148,872 141,935 4.9 %
Income from operations
124,854 140,213 (11.0)%
Operating income margin
21.3 %24.2 %
Net income
$93,519 $104,021 (10.1)%
Net income per diluted common share
$2.21 $2.43 (9.1)%
Adjusted EBITDA1
$148,278 $158,792 (6.6)%

Trailing Twelve Months Ended Year-Over-
September 30, Year

20242023Change
(In thousands, except percentages)
Total U.S. Housing starts21,384 1,407 (1.6)%

Management Commentary

“Our third quarter net sales of $587.2 million were up modestly year-over-year despite the housing markets in both the U.S. and Europe remaining under pressure,” commented Mike Olosky, President and Chief Executive Officer of Simpson Manufacturing Co., Inc. “In North America, our volumes were relatively flat year-over-year with strength in the national retail, component manufacturer and OEM markets offsetting weakness in residential and commercial. While product mix drove a higher average sales price per pound in the quarter, our customer mix resulted in greater volume discounts applied. In Europe, sales increased modestly year-over-year, outperforming the market as we’ve continued to benefit from new customer wins and product applications.”

1 Adjusted EBITDA is a non-GAAP financial measure and it is defined in the Non-GAAP Financial Measures section of the press release. For a reconciliation of Adjusted EBITDA to U.S. GAAP ("GAAP") net income see the schedule titled "Reconciliation of Net Income to Adjusted EBITDA".
2 Source: United States Census Bureau
3


Mr.Olosky continued, “Despite near-term challenges, we grew our North America volume by 500 basis points ahead of U.S. housing starts over the trailing twelve months. Even though our overall profitability is good, it is below our expectations and we are working to align costs with market conditions to improve profitability. For 2024, we now expect U.S. housing starts to be down in the low single-digit range from 2023 with low single-digit growth to come in 2025. In Europe, 2024 housing starts are expected to be down in the high single-digit range compared to the prior year with meaningful growth to be pushed out further into 2026 and beyond.”

North America Segment 2024 Third Quarter Financial Highlights

•Net sales of $461.4 million increased 1.0% from $456.8 million due to slightly higher average sales prices resulting from a favorable sales mix on relatively flat sales volumes, in addition to incremental sales from the Company's 2024 acquisitions.
•Gross margin decreased to 49.5% from 51.8%, primarily due to higher factory and overhead and warehouse costs, as a percentage of net sales, partly offset by efficiency gains.
•Income from operations of $123.3 million decreased 9.1% from $135.6 million. The decrease was primarily due to a decrease in gross profit, as well as increases in operating expenses of $4.1 million from 22.1% of net sales to 22.7%. Increased operating expenses include personnel costs (including engineering support services) and advertising and tradeshow costs, which were partly offset by a decrease in variable incentive compensation.

Europe Segment 2024 Third Quarter Financial Highlights

•Net sales of $121.2 million increased 1.8% from $119.0 million, due to increased sales volumes, partly offset by price decreases in some regions. Net sales benefited from the positive effect of approximately $1.5 million in foreign currency translation.
•Gross margin decreased to 36.6% from 37.9%, primarily due to higher labor, factory and overhead, and warehouse and freight costs as a percentage of net sales, partly offset by lower material costs.
•Income from operations of $12.6 million decreased 18.2% from $15.5 million. The decrease was primarily due to increases in operating expenses of $2.4 million from 24.3% of net sales to 25.8% as well as a decrease in gross profit. Increased operating expenses included higher personnel and depreciation costs, which were partly offset by a decrease in variable incentive compensation.

Refer to the “Segment and Product Group Information” table below for additional segment information (including information about the Company’s Asia/Pacific and Administrative and All Other segments).

Corporate Developments

During the third quarter, the Company completed the acquisition of all of the operating assets and assumed liabilities of Monet DeSauw Inc. and certain properties of Callaway Properties, LLC (together with its subsidiaries, “Monet”) for a total purchase consideration of approximately $48.5 million, net of cash received. Monet specializes in the production of large-scale saws and material handling equipment for the truss industry in the United States.

During the third quarter, the Company completed the acquisition of QuickFrames USA, a manufacturer of pre-engineered structural support systems for commercial construction with sales in North America.

Balance Sheet & 2024 Third Quarter Cash Flow Highlights

•As of September 30, 2024, cash and cash equivalents totaled $339.4 million with total debt outstanding of $465.4 million, of which $75.0 million remained outstanding under its $450.0 million revolving credit facility.

•Cash flow provided by operating activities of $102.5 million decreased from $200.9 million, primarily due to increases in working capital.

•Cash flow used in investing activities of $106.6 million increased from $18.5 million due to increases of $61.5 million in acquisitions and $25.6 million in capital expenditures.


4


Business Outlook

The Company has updated its 2024 financial outlook based on three quarters of financial information to reflect its latest expectations regarding demand trends, cost of sales, and operating expenses. Based on business trends and conditions as of today, October 21, 2024, the Company's outlook for the full fiscal year ending December 31, 2024 is as follows:

•Based on current expectations that U.S. housing starts will be down from the prior year, operating margin is estimated to be in the range of 19.0% to 19.5%.
•The effective tax rate is estimated to be in the range of 25.3% to 25.8%, including both federal and state income tax rates as well as international income tax rates, and assuming no tax law changes are enacted.

•Capital expenditures are estimated to be in the range of $175.0 million to $185.0 million, which includes $90.0 million to $100.0 million for the Columbus, Ohio facility expansion and the new Gallatin, Tennessee fastener facility construction with the remaining spend carrying over into 2025.

Conference Call Details

Investors, analysts and other interested parties are invited to join the Company’s third quarter 2024 financial results conference call on Monday, October 21, 2024, at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time). To participate, callers may dial (877) 407-0792 (U.S. and Canada) or (201) 689-8263 (International) approximately 10 minutes prior to the start time. The call will be webcast simultaneously and can be accessed through ir.simpsonmfg.com. For those unable to participate during the live broadcast, a replay of the call will also be available beginning that same day at 8:00 p.m. Eastern Time until 11:59 p.m. Eastern Time on Monday, November 4, 2024 by dialing (844) 512–2921 (U.S. and Canada) or (412) 317–6671 (International) and entering the conference ID: 13749013. The webcast will remain posted on the Investor Relations section of Simpson's website at ir.simpsonmfg.com for 90 days.

About Simpson Manufacturing Co., Inc.

Simpson Manufacturing Co., Inc., headquartered in Pleasanton, California, through its subsidiary, Simpson Strong-Tie Company Inc., designs, engineers and is a leading manufacturer of wood construction products, including connectors, truss plates, fastening systems, fasteners and shearwalls, and concrete construction products, including adhesives, specialty chemicals, mechanical anchors, powder actuated tools and reinforcing carbon & glass fiber materials. The Company primarily supplies its building product solutions to both the residential and commercial markets in North America and Europe. The Company's common stock trades on the New York Stock Exchange under the symbol "SSD."

Copies of Simpson Manufacturing's Annual Report to Stockholders and its proxy statements and other SEC filings, including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, are made available free of charge on the company's website on the same day they are filed with the SEC. To view these filings, visit the Investor Relations section of the Company's website.

5


Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally can be identified by words such as "anticipate," "believe," "estimate," "expect," "intend," "plan," "outlook," "target," "continue," "predict," "project," "change," "result," "future," "will," "could," "can," "may," "likely," "potentially," or similar expressions. Forward-looking statements are all statements other than those of historical fact and include, but are not limited to, statements about future financial and operating results, our plans, objectives, business outlook, priorities, expectations and intentions, expectations for sales and market growth, comparable sales, earnings and performance, stockholder value, capital expenditures, cash flows, the housing market, the home improvement industry, demand for services, share repurchases, our ongoing integration of ETANCO and recently acquired companies, our strategic initiatives, including the impact of these initiatives on our strategic and operational plans and financial results, and any statement of an assumption underlying any of the foregoing.

Forward-looking statements are subject to inherent uncertainties, risks and other factors that are difficult to predict and could cause our actual results to vary in material respects from what we have expressed or implied by these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those expressed in or implied by our forward-looking statements include the effect of global pandemics such as the COVID-19 pandemic or other widespread public health crisis and their effects on the global economy, the effects of inflation and labor and supply shortages, on our operations, and the operations of our customers, suppliers and business partners, and our ongoing integration of ETANCO, as well as those discussed in the "Risk Factors" and " Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of our most recent Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q and other reports we file with the SEC.

We caution that you should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. Readers are urged to carefully review and consider the various disclosures made in our reports filed with the SEC that advise of the risks and factors that may affect our business, results of operations and financial condition.

Non-GAAP Financial Measures

This press release includes certain financial information not prepared in accordance with Generally Accepted Accounting Principles in the United States (“GAAP”). Since not all companies calculate non-GAAP financial information identically (or at all), the presentations herein may not be comparable to other similarly titled measures used by other companies. Further, these measures should not be considered substitutes for the financial measures calculated in accordance with GAAP. The Company uses Adjusted EBITDA as an additional financial measure in evaluating the ongoing operating performance of its business. The Company believes Adjusted EBITDA allows it to readily view operating trends, perform analytical comparisons, and identify strategies to improve operating performance. Adjusted EBITDA should not be considered in isolation or as a substitute for GAAP financial measures such as net income or any other performance measures derived in accordance with GAAP. See the Reconciliation of Non-GAAP Financial Measures below.

The Company defines Adjusted EBITDA as net income (loss) before income taxes, adjusted to exclude depreciation and amortization, integration, acquisition and restructuring costs, goodwill impairment, gain on bargain purchase, net loss or gain on disposal of assets, interest income or expense, and foreign exchange and other expense (income).
6


Simpson Manufacturing Co., Inc. and Subsidiaries
UNAUDITED Condensed Consolidated Statements of Operations
(In thousands, except per share data)

Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
Net sales$587,153 $580,084 $1,714,710 $1,712,093 
Cost of sales312,096 297,167 916,562 888,835 
Gross profit275,057 282,917 798,148 823,258 
Research and development and engineering expense23,678 24,751 68,303 67,035 
Selling expense54,590 52,391 165,007 151,497 
General and administrative expense70,604 64,793 207,181 197,267 
Total operating expenses148,872 141,935 440,491 415,799 
Acquisition and integration related costs
1,356 785 4,992 4,086 
Gain on disposal of assets(25)(16)(460)(223)
Income from operations124,854 140,213 353,125 403,596 
Interest income and other, net
1,668 1,292 4,111 18 
Other & foreign exchange gain (loss), net
(29)(1,429)352 (1,471)
Income before taxes126,493 140,076 357,588 402,143 
Provision for income taxes32,974 36,055 90,821 102,958 
Net income$93,519 $104,021 $266,767 $299,185 
Earnings per common share:
Basic$2.22 $2.44 $6.31 $7.01 
Diluted$2.21 $2.43 $6.28 $6.98 
Weighted average shares outstanding: 
Basic42,151 42,673 42,254 42,651 
Diluted42,335 42,882 42,464 42,893 
Cash dividend declared per common share$0.28 $0.27 $0.83 $0.80 
Other data:
Depreciation and amortization$21,276 $18,180 $59,835 $54,224 
Pre-tax equity-based compensation expense$4,662 $6,625 $15,089 $17,789 
7


Simpson Manufacturing Co., Inc. and Subsidiaries
UNAUDITED Condensed Consolidated Balance Sheets
(In thousands)


September 30,December 31,
202420232023
Cash and cash equivalents$339,427 $571,006 $429,822 
Trade accounts receivable, net360,350 351,164 283,975 
Inventories583,380 504,446 551,575 
Other current assets51,609 51,583 47,069 
Total current assets1,334,766 1,478,199 1,312,441 
Property, plant and equipment, net495,822 382,508 418,612 
Operating lease right-of-use assets87,097 66,144 68,792 
Goodwill550,946 483,413 502,550 
Intangible assets, net395,517 356,450 365,339 
Other noncurrent assets33,311 48,773 36,990 
Total assets$2,897,459 $2,815,487 $2,704,724 
Trade accounts payable$110,321 $95,267 $107,524 
Long-term debt, current portion22,500 22,500 22,500 
Accrued liabilities and other current liabilities245,129 309,802 231,233 
Total current liabilities377,950 427,569 361,257 
Operating lease liabilities, net of current portion70,496 53,808 55,324 
Long-term debt, net of current portion and issuance costs442,886 539,073 458,791 
Deferred income tax 89,226 97,298 98,170 
Other long-term liabilities53,680 28,248 51,436 
Stockholders' equity1,863,221 1,669,491 1,679,746 
Total liabilities and stockholders' equity$2,897,459 $2,815,487 $2,704,724 
8


Simpson Manufacturing Co., Inc. and Subsidiaries
UNAUDITED Segment and Product Group Information
(In thousands)
Three Months EndedNine Months Ended
September 30,%September 30,%
20242023change*20242023change*
Net Sales by Reporting Segment
North America$461,356$456,8201.0%$1,331,126$1,328,6150.2%
Percentage of total net sales78.6 %78.8 %77.6 %77.6 %
Europe121,170119,0431.8%370,985371,074N/M
Percentage of total net sales20.6 %20.5 %21.6 %21.7 %
Asia/Pacific4,6274,2219.6%12,59912,4041.6%
$587,153$580,0841.2%$1,714,710$1,712,0930.2%
Net Sales by Product Group**
Wood Construction$494,379$491,3080.6%$1,450,972$1,461,442(0.7)%
Percentage of total net sales84.2 %84.7 %84.6 %85.4 %
Concrete Construction86,71584,1413.1%251,893242,1334.0%
Percentage of total net sales14.8 %14.5 %14.7 %14.1 %
Other6,0594,635N/M11,8458,51839.1%
$587,153$580,0841.2%$1,714,710$1,712,0930.2%
Gross Profit (Loss) by Reporting Segment
North America$228,169$236,451(3.5)%$660,287$680,218(2.9)%
 North America gross margin49.5 %51.8 %49.6 %51.2 %
Europe44,32745,115(1.7)%134,088139,538(3.9)%
Europe gross margin36.6 %37.9 %36.1 %37.6 %
Asia/Pacific1,6191,771N/M3,7814,515N/M
Administrative and all other942(420)N/M(8)(1,013)N/M
$275,057$282,917(2.8)%$798,148$823,258(3.1)%
Income (Loss) from Operations
North America$123,253$135,633(9.1)%$354,212$393,456(10.0)%
 North America operating margin26.7 %29.7 %26.6 %29.6 %
Europe12,63515,450(18.2)%33,03742,894(23.0)%
Europe operating margin10.4 %13.0 %8.9 %11.6 %
Asia/Pacific260477N/M(617)718N/M
Administrative and all other(11,294)(11,347)N/M(33,507)(33,472)N/M
$124,854$140,213(11.0)%$353,125$403,596(12.5)%
*Unfavorable percentage changes are presented in parentheses, if any.
**The Company manages its business by geographic segment but presents sales by product group as additional information.
N/MStatistic is not material or not meaningful.










Simpson Manufacturing Co., Inc. and Subsidiaries
9


Reconciliation of Non-GAAP Financial Measures
(In thousands) (Unaudited)
A reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP measure, is set forth below.

Three Months Ended September 30,
Net Income$93,519 $104,021 
Provision for income taxes32,974 36,055 
Interest (income) expense, net and other financing costs(1,668)(1,292)
Depreciation and amortization21,276 18,180 
Other*2,177 1,828 
Adjusted EBITDA$148,278 $158,792 

*Other: Includes acquisition, integration, and restructuring related expenses, other & foreign exchange loss net, and net loss or gain on disposal of assets.



CONTACT:     
Addo Investor Relations
investor.relations@strongtie.com
(310) 829-5400



10

v3.24.3
COVER PAGE
Oct. 21, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 21, 2024
Entity Registrant Name Simpson Manufacturing Co., Inc.
Entity Incorporation, State or Country Code DE
Entity File Number 1-13429
Entity Tax Identification Number 94-3196943
Entity Address, Address Line One 5956 W. Las Positas Boulevard
Entity Address, City or Town Pleasanton
Entity Address, State or Province CA
Entity Address, Postal Zip Code 94588
City Area Code 925
Local Phone Number 560-9000
Title of 12(b) Security Common Stock, par value $0.01 per share
Trading Symbol SSD
Security Exchange Name NYSE
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Entity Central Index Key 0000920371
Amendment Flag false
Simpson Manufacturing (NYSE:SSD)
Historical Stock Chart
From Nov 2024 to Dec 2024 Click Here for more Simpson Manufacturing Charts.
Simpson Manufacturing (NYSE:SSD)
Historical Stock Chart
From Dec 2023 to Dec 2024 Click Here for more Simpson Manufacturing Charts.