Owens Corning Delivers Record Full-Year 2022 Results

Owens Corning, a global building and construction materials leader, today reported fourth-quarter and full-year 2022 results.

• Reported Net Sales Increase of 15% in 2022 to $9.8 Billion
• Produced Full-Year Net Earnings of $1.2 Billion
• Expanded 2022 Adjusted EBIT Margins to 18% and Adjusted EBITDA Margins to 23%
• Delivered Diluted EPS of $12.70 and Adjusted Diluted EPS of $12.88
• Generated Operating Cash Flow of $1.8 Billion and Free Cash Flow of $1.3 Billion, Conversion of 104%
• Returned $931 Million, or 71%, of Free Cash Flow to Shareholders through Dividends and Share Repurchases

“Our strong performance in 2022 demonstrated the resiliency of our team, the strength of our businesses, and the earnings power of our company amid changing market conditions. During the year, we continued to advance our enterprise strategy, positioning the company for long-term success,” said Board Chair and Chief Executive Officer Brian Chambers. “While we anticipate our markets in 2023 will be more challenging, we remain focused on outperforming the market and delivering value for our shareholders.”

Enterprise Strategy Highlights

• In 2022, the company continued to advance its strategy to strengthen its core building and construction products and expand into new product adjacencies, which will increase its addressable markets in higher growth segments, including:
  • The acquisition of WearDeck®, a premium producer of composite weather-resistant decking for commercial and residential applications.
  • The acquisition of Natural Polymers, LLC, an innovative manufacturer of spray polyurethane foam insulation for building and construction applications.
  • The acquisition of the remaining 50% interest in an existing joint venture based in the U.S., that produces high-quality wet-formed fiberglass mat for roofing applications.
  • The formation of a joint venture with Pultron Composites to manufacture industry-leading fiberglass rebar.
  • The sale of its European dry-use chopped strand manufacturing assets located in Chambéry, France.
• Owens Corning continues to invest in accelerating new product and process innovation to support customers and generate additional growth. In 2022, it launched 54 new or refreshed products, up 13% compared with 2021.
• Owens Corning sustained a high level of safety performance in 2022 with a recordable incident rate (“RIR”) of 0.65.
• Owens Corning continues to be recognized as a leader in environmental, social, and governance matters. In the fourth quarter, the company earned a place on the Dow Jones Sustainability World Index for the 13^th consecutive year.

Cash Returned to Shareholders

• During 2022, the company returned $931 million to shareholders through dividends and share repurchases. The company paid dividends of $136 million and repurchased 9.2 million shares of common stock for $795 million.
• In December 2022, Owens Corning announced its Board of Directors declared quarterly cash dividends of $0.52 per common share, an approximately 50% increase compared with the associated prior quarterly dividends.
• In December, Owens Corning’s Board of Directors approved a share repurchase authorization for up to 10 million shares of the company’s common stock. This was in addition to its previously announced share buyback program that had 4.4 million shares available for repurchase under the prior authorization as of the end of 2022.

“Earnings expansion, along with our ongoing disciplined management of working capital, operating expenses, and capital investments, drove record free cash flow generation in 2022 of $1.3 billion and conversion of 104%,” said Executive Vice President and Chief Financial Officer Ken Parks. “During the year, we returned 71% of free cash flow to shareholders through dividends and share repurchases, while deploying capital in support of our enterprise strategy. We remain committed to maintaining our investment-grade balance sheet and returning approximately 50% of free cash flow to shareholders over time through dividends and share repurchases.”

Other Notable Highlights

• As announced in December, Owens Corning completed the sale of its operations in Russia.

2022 Segment Performance

Full-Year

• Composites net sales increased 14% to $2.7 billion in 2022 compared with 2021, primarily due to higher selling prices and the favorable impact of customer mix partially offset by lower volumes and ongoing currency headwinds. EBIT increased $122 million to $498 million, with 19% EBIT margins, on higher selling prices, which offset input cost inflation and increased transportation costs as well as lower volumes and other manufacturing costs.
• Insulation net sales increased 17% to $3.7 billion compared with 2021, as a result of higher selling prices and favorable mix more than offsetting ongoing currency headwinds and slightly lower volumes. EBIT increased $166 million to $612 million, with 16% EBIT margins, on higher selling prices, which offset energy, material, and transportation inflation, production downtime, and other manufacturing costs.
• Roofing net sales increased 14% to $3.7 billion compared with 2021, primarily due to higher selling prices partially offset by lower volumes. EBIT increased $78 million to $831 million, with 23% EBIT margins, mainly due to higher selling prices, which offset cost inflation, primarily asphalt, and other manufacturing costs.

Fourth-Quarter

• Composites net sales decreased 3% to $589 million in fourth-quarter 2022 compared with fourth-quarter 2021, primarily due to lower volumes and unfavorable currency translation partially offset by higher selling prices. EBIT decreased $34 million to $64 million, with 11% EBIT margins, on ongoing input cost inflation, as well as lower volumes and the impact of production downtime and other manufacturing costs, which were partially offset by higher selling prices.
• Insulation net sales increased 11% to $956 million in fourth-quarter 2022 compared with fourth-quarter 2021, as a result of higher selling prices and a full quarter of sales from Natural Polymers partially offset by lower volumes and unfavorable currency translation. EBIT increased $25 million to $153 million, with 16% EBIT margins, on higher selling prices, which offset ongoing energy, material, and transportation inflation as well as the impact related to other manufacturing costs and production downtime.
• Roofing net sales increased 12% to $799 million in fourth-quarter 2022 compared with fourth-quarter 2021, primarily due to higher selling prices partially offset by lower volumes. EBIT increased $17 million to $168 million, with 21% EBIT margins, primarily due to higher selling prices, partially offset by cost inflation, primarily asphalt, as well as the impact of other manufacturing costs and lower volumes.

First-Quarter and Full-Year 2023 Outlook

• The key economic factors that impact the company’s businesses are residential repair and remodeling activity, U.S. housing starts, global commercial construction activity, and global industrial production.
• In the near term, the company expects many of its end markets to be more challenging as the impacts of ongoing inflation, higher interest rates, and continued geopolitical uncertainties result in a decelerating global economic environment.
• For first-quarter 2023, the company expects overall performance to result in a moderate decline of net sales, versus the comparable quarter in the prior year, with EBIT margins of low to mid-teens.

For the full year-end results, click here.

About Owens Corning

Owens Corning is a global building and construction materials leader committed to building a sustainable future through material innovation. Our three integrated businesses – Composites, Insulation, and Roofing – 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 approximately 19,000 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 2022 sales of $9.8 billion. For more information, visit www.owenscorning.com.

Contact:

Amber Wohlfarth – Director, Investor Relations – Amber.Wohlfarth@owenscorning.com – (419) 248-5639

Source: Owens Corning