Mativ Holdings Inc · Q3 2021 earnings

Briefing

Reported strong demand in AMS, offset by escalating input cost inflation and supply chain challenges

SWM International reported a 37.3% increase in total sales to $383.6 million, but a 1% decrease on an organic basis. GAAP operating profit was $23.0 million, down $14.0 million, while adjusted operating profit was $40.0 million, down $12.7 million. GAAP EPS was $0.38, down from $0.78, and adjusted EPS was $0.82, down from $1.16. Management expects full year 2021 adjusted EPS to finish below the previously provided guidance range.

• Total sales were $383.6 million, up 37.3%, but down 1% on organic basis
• GAAP operating profit was $23.0 million, or 6.0% of sales, down $14.0 million; Adjusted operating profit was $40.0 million, or 10.4% of sales, down $12.7 million
• GAAP EPS was $0.38, down from $0.78; Adjusted EPS was $0.82, down from $1.16
• Management now expects full year 2021 Adjusted EPS to finish below the $3.75 to $4.05 guidance range provided in May, with fourth quarter Adjusted EPS expected to be down approximately 20% versus prior year quarter

Headline financials

Revenue & EPS history

Given performance to-date and the expectation that fourth quarter results will reflect continued impacts from inflationary and supply chain pressures, the Company projects full year Adjusted EPS will be below the previously provided range of $3.75 to $4.05 (provided in May 2021). The Company anticipates fourth quarter Adjusted EPS could be down approximately 20% versus the prior year fourth quarter, with key variables including input costs, raw material availability, and non-operating items such as tax rate and joint venture results. The Company further indicated that it expects strong operating profit growth in 2022 as raw material prices and supply chain conditions normalize.