Carlisle Companies Reports Record Fourth Quarter and Full Year 2022 Results

Carlisle Companies Incorporated today announced its fourth quarter 2022 financial results.

Comments from Chris Koch, Chair, President and Chief Executive Officer

“2022 was a remarkable year for the entire Carlisle team. In addition to delivering record fourth quarter sales of $1.5 billion, we also delivered record annual sales of $6.6 billion, surpassing $6 billion of sales for the first time in our over one hundred year history. We further delivered a record Adjusted Diluted EPS of $3.92 in the quarter, an increase of 34% year-over-year.

2022 also marked a key milestone in our Vision 2025 journey as we delivered $17.58 of GAAP EPS for the year, exceeding our primary goal of generating $15 GAAP EPS for our shareholders. Our achievements in 2022 would not have been possible without the hard work of the entire Carlisle team, and the clarity of mission that Vision 2025 has provided since its launch in 2018.

The past three years have been one of the most challenging operating environments in over a decade. By staying focused on our vision, delivering on our key initiatives, and developing exceptional talent globally, we continue to execute on our plans, staying focused on the key pillars of Vision 2025. These pillars include: driving greater than 5% organic revenue growth annually, utilizing the Carlisle Operating System to drive efficiencies and operating leverage, reshaping the portfolio with synergistic acquisitions and strategic divestitures, investing in and developing exceptional talent and deploying over $3 billion into capital expenditures, share repurchases, and dividends.

These pillars support the foundation of Carlisle’s culture of a diversified workplace, decentralized management style, entrepreneurial spirit and a culture of continuous improvement. Taken together, they drove the accelerated achievement of Vision 2025, and will continue to guide our value-creation in 2023 and beyond.

The fourth quarter of 2022 played out much as we expected. Supply chain conditions continued to improve, while the broader economy returned to a less frenetic environment, enabling our channel partners to settle into a more normalized buying cadence. While this normalization is occurring during our seasonally soft fourth and first quarters that can be heavily influenced by inclement weather, we believe strong long-term underlying fundamentals remain, including solid re-roofing demand and an increased focus on the energy efficiency of buildings.

Highlighting some of the significant drivers and accomplishments in the fourth quarter:

• Commercial re-roofing demand continues, including significant interest and activity in Carlisle’s sustainable building solutions driven by rising energy costs, sustainability trends and projected investment from the Inflation Reduction Act;
• Pricing remained consistently positive across segments as we continue to demonstrate our value to our customers;
• Despite continued Fed rate hikes, the beginnings of a reduction of global inflation and greater availability of materials are leading us toward a more normalized operating environment;
• We remained disciplined in our approach to capital deployment:
  • Repurchasing 770 thousand shares for $199 million;
  • Paying $39 million of dividends in the quarter;
  • Investing $53 million into our businesses in the form of capital expenditures to drive innovation and the Carlisle Experience;
• Finally, we announced our commitment to achieve Net-Zero GHG emissions across our entire value chain by 2050, aligning our goals with the Science Based Targets Initiative. The Science Based Targets initiative, SBTi, is an independent body based in the U.K. that works in conjunction with the United Nations to help guide companies to establish emission reduction initiatives using science-based targets.

As we move further into 2023, and with Vision 2025 objectives well-ingrained throughout Carlisle, we will take actions to navigate this complex operating environment, deliver the Carlisle Experience to our customers and drive earnings growth for our shareholders.”

Fourth Quarter 2022

Revenue for the fourth quarter of $1.5 billion increased 5.7% year-over-year. Organic revenue increased 6.6% (organic revenue defined as revenue excluding acquired revenues within the last 12 months and the impact of changes in foreign exchange rates versus the U.S. Dollar). Acquired revenues contributed a total of 0.2% in the quarter. Changes in foreign exchange rates had a negative 1.1% impact on revenues.

Operating income for the fourth quarter of $239.6 million increased 31.3% from $182.5 million in the fourth quarter of 2021. Income from continuing operations for the fourth quarter of $179.8 million increased 37.5% from $130.8 million in the fourth quarter of 2021. Adjusted EBITDA for the fourth quarter of $308.2 million increased 21.5% from $253.7 million in the fourth quarter of 2021.

Diluted earnings per share (EPS) for the fourth quarter of $3.44 increased 39.8% from $2.46 in the fourth quarter of 2021. Adjusted diluted EPS for the fourth quarter of $3.92 increased 34.2% from $2.92 in the fourth quarter of 2021. The increase in EPS reflects strong operating results at CCM, continued contributions from CWT, improving performance at CIT and CFT, and share repurchases.

Fourth Quarter 2022 Segment Highlights

Carlisle Construction Materials (CCM)

• Revenues of $800.4 million, up 2.2% (+3.0% organic) year-over-year, were driven by resilience of U.S. commercial roofing demand and price realization, partially offset by seasonal buying patterns as a result of a return to normal operating conditions, unfavorable impact of foreign exchange and unfavorable mix.
• Operating income was $213.3 million, up 23.2% year-over-year. Adjusted EBITDA was $228.0 million, up 22.3% year-over-year, reflecting an adjusted EBITDA margin of 28.5%, which was favorably impacted by positive pricing, and savings from the Carlisle Operating System (COS), and partially offset by volume, unfavorable product mix and raw material and wage inflation.
• We expect full year 2023 sales to increase low-single-digits year-over-year.

Carlisle Weatherproofing Technologies (CWT)

• Revenues of $349.5 million, up 5.5% (+5.5% organic) year-over-year, were driven by retail strength and positive pricing, partially offset by residential demand weakness.
• Operating income was $22.5 million, down -11.4% year-over-year. Adjusted EBITDA was $44.9 million, down -12.1% year-over-year reflecting an adjusted EBITDA margin of 12.8%, which was negatively impacted by volumes in residential-related businesses, unfavorable mix and raw material, freight and wage inflation, partially offset by positive pricing and savings from COS.
• We expect full year 2023 sales to decrease low-double-digits year-over-year.

Carlisle Interconnect Technologies (CIT)

• Revenues of $224.1 million, up 21.5% (+21.9% organic) year-over-year, were driven by continued strengthening of aerospace and medical end markets.
• Operating income was $18.9 million, up 186% year-over-year. Adjusted EBITDA was $39.4 million, up 40.2% year-over-year reflecting an adjusted EBITDA margin of 17.6%, which was positively impacted by higher volumes, and positive pricing, partially offset by wage inflation.
• We expect full year 2023 sales to increase high-single-digits year-over-year.

Carlisle Fluid Technologies (CFT)

• Revenues of $80.6 million, up 4.3% (+11.3% organic) year-over-year, reflected higher volumes and positive pricing, partially offset by unfavorable impact from changes in foreign exchange rates.
• Operating income was $13.0 million up 55% year-over-year. Adjusted EBITDA was $17.8 million, up 28.1% year-over-year reflecting an adjusted EBITDA margin of 22.1%, which was positively impacted by price realization and savings from COS, and partially offset by raw material and wage inflation.
• We expect full year 2023 sales to increase high-single-digits year-over-year.

Cash Flow

Operating cash flow from continuing operations for the twelve months ended December 31, 2022, was $1,009.1 million, an increase of $595.5 million versus the prior year. Free cash flow from continuing operations was $825.6 million, an increase of $540.1 million versus prior year (defined as cash provided by operating activities less capital expenditures, and comprised of continuing operations). This increase was driven by higher net income year-over-year and a reduction in working capital uses related to collection of accounts receivable, partially offset by a reduction in accounts payable.

During the year ended December 31, 2022, we deployed $400.0 million toward share repurchases and paid $134.4 million in cash dividends. As of December 31, 2022, we had $400.0 million of cash and cash equivalents and $1.0 billion of availability under our revolving credit facility.

For the complete press release, click here.

About Carlisle Companies Incorporated

Carlisle Companies Incorporated is a leading supplier of innovative Building Envelope products and energy-efficient solutions for customers creating sustainable buildings of the future. Through its building products businesses (CCM and CWT) and family of leading brands, Carlisle delivers innovative, labor-reducing and environmentally responsible products and solutions to customers through the Carlisle Experience. Over the life of a building, Carlisle’s products help drive lower greenhouse gas emissions, improve energy savings for building owners and operators, and increase a building’s resiliency to the elements. Driven by its strategic plan, Vision 2025, Carlisle is committed to generating superior shareholder returns and maintaining a balanced capital deployment approach, including investments in our businesses, strategic acquisitions, share repurchases and continued dividend increases. Carlisle also is a leading provider of products to the Aerospace, Medical Technologies and General Industrial markets through its Interconnect Technologies (CIT) and Fluid Technologies (CFT) business segments.

Contact:

Jim Giannakouros, CFA – Vice President of Investor Relations – jgiannakouros@carlisle.com – (480) 781-5135

Source: Carlisle Companies Incorporated