Question-and-Answer SessionBill, as I walk over to you, just starting off. There's a lot going on in Atkore. As you know, you're undergoing a strategic review, which includes a lot of potential alternatives, potential sale of the company, maybe some divestitures. So any sort of update on to what's going on? And why did the Board, you think, decide to go this route?William WaltzPresident, CEO & Director Yes. So I'll try to do it, Andy, great kickoff question. Chronologically, I assume like all companies, but ...

Atkore (NYSE:ATKR) 2026 Conference Summary Company Overview - **Company**: Atkore - **Date**: February 18, 2026 - **Speakers**: Bill Waltz (President and CEO), John Deitzer (CFO) Key Points Strategic Review and Company Direction - Atkore is undergoing a strategic review, considering various alternatives including potential sale or divestitures to enhance shareholder value [1][2][4] - The board is focused on long-term strategic planning, particularly emphasizing the electrical industry [2][4] - Recent actions include selling the Tectron operation in Wisconsin and exploring alternatives for HDPE [4] Market Performance and Growth Indicators - Atkore anticipates mid-single-digit growth, with half of this expected to come from organic growth [6][18] - Strong performance is noted in data centers, healthcare, manufacturing, and multifamily housing, while single-family housing remains weak [6][18] - The company is experiencing favorable growth trends, supported by leading indicators such as DMI [6] Data Center Market Strategy - Atkore is focusing on direct sales to data centers and chip manufacturers, bypassing distributors in some cases [11][15] - The company has established off-site manufacturing locations to preassemble products for data centers, which has been successful in the U.S. and is expanding to international markets [15][17] Volume Growth and Market Outlook - The company reported low single-digit volume growth in Q1 but maintains a full-year outlook of mid-single-digit growth [18][20] - Anticipated growth in the solar business and construction services is expected to contribute positively to volume growth [20][21] Pricing and Cost Dynamics - Pricing for products has seen a moderation, with a 2.7% decrease in Q1 2026 compared to a 12% decrease in Q1 2025 [59] - The company is managing cost pressures from raw materials, particularly copper and aluminum, which have experienced significant volatility [40][41] Margin Improvement Initiatives - Atkore is closing three manufacturing facilities, which is expected to yield $10-$12 million in benefits, primarily in fiscal 2027 [54][56] - The company is also divesting underperforming businesses to improve margins and return on invested capital [56] Inventory and Channel Health - Channel inventories are reported as normal, with no significant destocking or overstocking observed [26] - Distributors are optimistic about market growth, indicating a healthy channel environment [26] Competitive Landscape and Pricing Strategy - Atkore's pricing strategy involves maintaining a premium for its products through strong relationships with distributors and bundling services [28][36] - The company is navigating the competitive landscape with a focus on differentiating its offerings despite market commoditization [28][36] Future Growth Areas - The company is optimistic about growth in the municipal water sector, with plans to expand its product offerings [91][96] - Atkore is also exploring opportunities in the residential market, although recovery has not yet materialized [101][107] Cash Management and Capital Allocation - Atkore has paused M&A activities and is focusing on internal initiatives, including maintaining its quarterly dividend [114][120] - The company is evaluating its capital allocation strategy, balancing dividends and potential share repurchases [114][120] Emerging Trends and Innovations - The strategic review emphasizes a focus on core electrical products and services, aligning with industry trends [132] Conclusion - Atkore is strategically positioning itself for growth in the electrical industry while managing market challenges and exploring new opportunities in data centers, solar, and municipal water sectors. The company is focused on improving margins through operational efficiencies and divestitures, while maintaining a healthy channel inventory and pricing strategy.

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Financial Data and Key Metrics Changes - The company achieved net sales of $656 million and Adjusted EBITDA of $69 million in Q1, both exceeding the outlook range [4][9] - Adjusted EPS was $0.83, above the top end of the outlook range, while the prior year's EPS was $1.63 [9] - Organic volume increased by 2% year-over-year, driven by strong performance in the electrical segment [4][11] - The tax rate in Q1 was 3%, a significant decrease from 21% in the prior year, reflecting a one-time discrete benefit [9] Business Line Data and Key Metrics Changes - The electrical segment saw net sales increase year-over-year, driven by higher volume growth, although adjusted EBITDA margins compressed due to higher material costs and lower average selling prices [12] - The S&I segment experienced lower net sales compared to the previous year, primarily due to lower volume, but adjusted EBITDA and margins increased due to improved productivity [12] Market Data and Key Metrics Changes - The company expects mid-single-digit volume growth for the full year, supported by core construction growth and contributions from solar and global construction services [13][15] - The Dodge Momentum Index indicates favorable growth in core non-residential end markets, with significant investments expected in the data center market [18] Company Strategy and Development Direction - The company is focused on its core electrical infrastructure portfolio, supported by broader mega trends, and is advancing its 80/20 Initiative to streamline manufacturing capacity [5][7] - The divestiture of the TekTube mechanical tube product line aligns with the company's strategy to enhance focus on electrical end markets [5] - The company plans to exit three manufacturing facilities in the second fiscal quarter to further streamline operations [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the FY 2026 outlook, expecting net sales between $2.95 billion and $3.05 billion, with adjusted EBITDA remaining unchanged at $340 million to $360 million [6][15] - The management highlighted ongoing productivity improvements and a favorable cash position despite a year-over-year decline in operating cash flow [12][13] Other Important Information - The company recognized approximately $18 million in cash proceeds from the TekTube divestiture and anticipates an additional $7 million from real estate sales in Q2 [13] - The company is on track to deliver its fiscal year 2025 sustainability report, detailing ongoing initiatives and accomplishments [6] Q&A Session Summary Question: Can you provide more color on the core markets? - Management noted good growth in PVC and steel conduit markets, with strong backlogs and commitments for data center projects [24][26] Question: Why was there no increase in EBITDA and EPS guidance despite good Q1 results? - Management indicated it is early in the year and preferred to maintain current guidance while monitoring progress [28][32] Question: What is the update on the competitive environment and pricing? - Management acknowledged ongoing import competition in PVC conduit but noted improved pricing and margins in steel conduit [34][35] Question: Can you provide an update on the strategic review and cost-saving efforts? - Management confirmed ongoing strategic alternatives and highlighted expectations for productivity gains from facility closures [41][42] Question: How is the solar market performing? - Management indicated that solar activity was down year-over-year but noted a good backlog and expected demand growth in the second half of the year [85][86]

Financial Data and Key Metrics Changes - The company achieved net sales of $656 million and Adjusted EBITDA of $69 million in the first quarter, both exceeding the outlook range [4][9] - Adjusted EPS was $0.83, above the top end of the outlook range, while the tax rate decreased to 3% from 21% in the prior year due to a one-time discrete benefit [9][12] - Organic volume increased by 2% year-over-year, driven by strong performance in the electrical segment [4][10] Business Line Data and Key Metrics Changes - The electrical segment saw net sales increase year-over-year, driven by higher volume growth, although adjusted EBITDA margins compressed due to higher material costs and lower average selling prices [12] - The S&I segment experienced lower net sales compared to the previous year, primarily due to lower volume, but adjusted EBITDA and margins increased due to improved productivity [12][14] Market Data and Key Metrics Changes - The company expects mid-single-digit volume growth for the full year, supported by core construction growth and contributions from solar and global construction services [9][14] - The Dodge Momentum Index indicates favorable growth in core non-residential end markets, with significant investments expected in the data center market [17] Company Strategy and Development Direction - The company is focused on its core electrical infrastructure portfolio, aligning with broader mega trends for growth opportunities [7][14] - The ongoing strategic alternative process aims to strengthen the business and maximize shareholder value, including the divestiture of the TekTube mechanical tube product line [4][5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the FY 2026 outlook, expecting net sales between $2.95 billion and $3.05 billion, with adjusted EBITDA remaining unchanged at $340 million to $360 million [6][7] - The company is optimistic about the future, particularly regarding data centers and other end markets, while maintaining a cautious approach to guidance [26][30] Other Important Information - The company completed the divestiture of its TekTube product line, enhancing focus on electrical infrastructure [4][5] - The company is on track to exit three manufacturing facilities, which is expected to generate $10-$12 million in productivity savings [40][42] Q&A Session Summary Question: Can you provide more color on core markets and PVC/metal conduit volume? - Management noted good growth in PVC and steel conduit markets, with strong backlogs and commitments for data center projects [23][24][25] Question: Why was EBITDA and EPS not raised despite good Q1 results? - Management indicated it is early in the year and preferred to maintain current guidance while monitoring progress [26][30] Question: Update on competitive environment and PVC pricing? - Management acknowledged ongoing import competition in PVC but noted improved pricing dynamics in steel conduit [32][33] Question: Update on strategic review and productivity expectations? - Management confirmed ongoing strategic alternatives and anticipated strong productivity contributions throughout the year [39][43] Question: Insights on cash flow and operational metrics? - Management expects cash flow to improve in the second quarter, with modest reductions in capital expenditures [52][53] Question: Update on solar activity and capacity shifts? - Management reported a good backlog in solar projects and noted that the Hobart facility is performing well [83][87]

Financial Data and Key Metrics Changes - The company achieved net sales of $656 million and Adjusted EBITDA of $69 million in the first quarter, both exceeding the outlook range [4][8] - Adjusted EPS was $0.83, above the top end of the outlook range, compared to $1.63 in the prior year [8] - Organic volume increased by 2% year-over-year, driven by strong performance in the electrical segment [4][8] - The tax rate in the first quarter was 3%, a decrease from 21% in the prior year, reflecting a one-time discrete benefit [8] Business Line Data and Key Metrics Changes - Net sales in the electrical segment increased year-over-year, driven by higher volume growth, but adjusted EBITDA margins compressed due to higher material costs and lower average selling prices [10] - The S&I segment saw lower net sales compared to the previous year, primarily due to lower volume, but adjusted EBITDA and margins increased due to productivity gains [10] - The mechanical tube business, including solar-related products, is expected to grow throughout the year due to large utility-scale solar projects [9] Market Data and Key Metrics Changes - The company expects mid-single-digit volume growth for the full year, supported by core construction growth and contributions from solar and global construction services [11][12] - The Dodge Momentum Index forecasts continued growth in core non-residential end markets, indicating favorable conditions for the company [12][16] - The Associated Builders and Contractors estimate a need for approximately 350,000 additional workers in construction services by 2026, growing to 450,000 in 2027 [16] Company Strategy and Development Direction - The company is focused on its core electrical infrastructure portfolio, supported by broader mega trends, and is advancing its strategic alternative process to maximize shareholder value [4][6] - The divestiture of the TekTube mechanical tube product line aligns with the company's 80/20 Initiative, which aims to direct manufacturing capacity to electrical end markets [5][6] - The company plans to exit three manufacturing facilities in the second fiscal quarter to streamline operations and enhance focus on electrical infrastructure products [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the FY 2026 outlook, expecting net sales between $2.95 billion and $3.05 billion, with adjusted EBITDA between $340 million and $360 million [6][12] - The company is optimistic about market demand for the remainder of the year and is focused on continuous improvement initiatives to drive sales and profitability [6][12] - Management noted that while the first quarter was strong, they prefer to maintain current guidance and assess performance over the next quarter before making further adjustments [26][30] Other Important Information - The company recognized approximately $18 million in cash proceeds from the TekTube divestiture during the quarter, with an additional $7 million expected in the second quarter from real estate sales [11] - The balance sheet remains strong, with no debt maturity repayments required until 2030 [11] Q&A Session Summary Question: Can you provide more color on core markets and construction services? - Management noted good growth in PVC and steel conduit markets, with strong backlogs and commitments for data center projects, indicating bullish sentiment for the fiscal year [22][25] Question: Why was there no increase in EBITDA and EPS guidance despite a strong Q1? - Management indicated it is early in the year and they prefer to maintain current guidance while assessing performance in the upcoming quarters [26][30] Question: What is the update on competitive dynamics and pricing? - Management acknowledged ongoing import competition in PVC conduit, while steel conduit pricing has improved due to strong demand and reduced imports [31][32] Question: Can you elaborate on the strategic review and cost-saving efforts? - Management confirmed ongoing strategic alternatives and highlighted expectations for productivity gains from facility closures, estimating $10-$12 million in savings [38][39] Question: How is cash flow expected to evolve throughout fiscal 2026? - Management anticipates cash flow from operations to improve in the second quarter and ramp up in the third and fourth quarters, following a strong Q4 FY 2025 [50][51] Question: What is the status of solar activity and capacity shifts? - Management reported a good backlog for solar projects and noted that the Hobart facility is performing well, contributing to productivity gains [81][85]

Cautionary Statements This presentation is provided for general informational purposes only and it does not include every item which may be of interest, nor does it purport to present full and fair disclosure with respect to Atkore Inc. (the "Company" or "Atkore") or its operational and financial information. Atkore expressly disclaims any current intention to update any forward-looking statements contained in this presentation as a result of new information or future events or developments or otherwise, ex ...

Core Insights - Atkore Inc. reported net sales of $655.5 million for Q1 2026, a decrease of 0.9% compared to the previous year [1] - Net income per diluted share fell to $0.44, down $0.87 from the prior year, while adjusted net income per diluted share decreased to $0.83, down $0.80 [1] - The company’s adjusted EBITDA for the quarter was $69.1 million, a decline of 30.3% from $99.1 million in the same period last year [1] Financial Performance - Net sales decreased by $6.0 million, primarily due to lower average selling prices and the impact of divestitures, partially offset by increased sales volume [1] - Gross profit dropped by $45.2 million, or 26.4%, leading to a gross margin decrease to 19.2% from 25.9% [1] - Adjusted EBITDA margin decreased to 10.5% for the quarter, reflecting lower gross profit and increased input costs [1][5] Segment Analysis - Electrical segment net sales increased by $4.2 million, or 0.9%, attributed to higher sales volume, while adjusted EBITDA decreased by 40.4% to $55.1 million [1][5] - Safety & Infrastructure segment net sales fell by $10.5 million, or 5.3%, primarily due to lower sales volume, but adjusted EBITDA rose by 93.8% to $30.2 million [1][5] Dividend and Outlook - The Board of Directors approved a quarterly dividend of $0.33 per share, payable on February 27, 2026 [2] - The company maintains its full-year 2026 adjusted EBITDA outlook in the range of $340 million to $360 million and adjusted net income per diluted share between $5.05 and $5.55 [2]

Financial Performance - Net sales for the first quarter of fiscal 2026 were $655.5 million, a decrease of 0.9% compared to $661.6 million in the prior year[5]. - Net income decreased by $31.3 million, or 67.6%, to $15.0 million for the quarter, down from $46.3 million in the prior year[8]. - Adjusted EBITDA decreased by $30.0 million, or 30.3%, to $69.1 million compared to $99.1 million in the prior year[9]. - Adjusted net income per diluted share decreased by $0.80 to $0.83 for the quarter, compared to $1.63 in the prior year[10]. - Gross profit decreased by $45.2 million, or 26.4%, to $125.9 million, with a gross margin of 19.2% compared to 25.9% in the prior year[7]. - Free Cash Flow for the three months ended December 26, 2025, was $(67,255), compared to $33,079 in the same period of 2024[37]. - Adjusted net income for the three months ended December 26, 2025, was $28,013, down from $57,102 in the prior year, a decline of 50.9%[45]. - The diluted net income per share decreased to $0.44 from $1.31 year-over-year, representing a drop of 66.4%[45]. Segment Performance - The Electrical segment reported net sales of $469.6 million, an increase of 0.9%, while the Safety & Infrastructure segment saw a decrease of 5.3% to $186.3 million[11][13]. - Adjusted EBITDA margin for the Electrical segment decreased to 11.7% from 19.9% in the prior year, primarily due to lower average selling prices and higher input costs[12]. - Adjusted EBITDA margin for the Electrical segment was 11.7%, down from 19.9% in the previous year, while the Safety & Infrastructure segment saw an increase to 16.2% from 7.9%[43]. Asset and Liability Changes - Total assets decreased to $2,788,581 as of December 26, 2025, from $2,851,922 as of September 30, 2025[35]. - Total liabilities decreased to $1,383,311 as of December 26, 2025, from $1,453,581 as of September 30, 2025[35]. - Cash and cash equivalents at the end of the period were $443,771, down from $506,699 at the beginning of the period[36]. - Total debt as of December 26, 2025, was $761,053, slightly up from $760,532 in September 2025[47]. - Net debt increased to $317,282 as of December 26, 2025, compared to $253,833 in September 2025, marking a rise of 25%[47]. Other Financial Metrics - The company maintains its full-year 2026 Adjusted EBITDA outlook at a midpoint of $350 million and Adjusted net income per diluted share at a midpoint of $5.30[5][16]. - Trailing twelve months (TTM) Adjusted EBITDA for the period ended December 26, 2025, was $356,390, down from $386,356 in September 2025, a decrease of 7.5%[48]. - Stock-based compensation for the three months ended December 26, 2025, was $4,020, compared to $6,097 in the same period last year, a reduction of 34.1%[45]. - The company reported a loss on the extinguishment of debt amounting to $795 for the TTM ended December 26, 2025[50]. - Asset impairment charges totaled $214,387 for the TTM ended December 26, 2025, indicating significant financial adjustments[50]. Dividend Information - The Board of Directors approved a quarterly dividend payment of $0.33 per share, payable on February 27, 2026[15].

Financial Performance - Net sales decreased by $6.0 million, or 0.9%, to $655.5 million for the three months ended December 26, 2025, compared to $661.6 million for the same period in 2024[105] - Cost of sales increased by $39.1 million, or 8.0%, to $529.6 million for the three months ended December 26, 2025, primarily due to increased input costs of $25.3 million and increased depreciation of $11.8 million[107] - Operating income fell by $47.9 million, or 70.5%, to $20.1 million for the three months ended December 26, 2025, compared to $67.9 million for the same period in 2024[105] - Net income decreased by $31.3 million, or 67.6%, to $15.0 million for the three months ended December 26, 2025, compared to $46.3 million for the same period in 2024[105] - Adjusted EBITDA for the Electrical segment decreased by $37.3 million, or 40.4%, to $55.1 million for the three months ended December 26, 2025, compared to $92.4 million for the same period in 2024[118] - Adjusted EBITDA margin for the Electrical segment decreased to 11.7% for the three months ended December 26, 2025, compared to 19.9% for the same period in 2024[119] - Net sales for the Safety & Infrastructure segment decreased by $10.5 million, or 5.3%, to $186.3 million for the three months ended December 26, 2025, compared to $196.7 million for the same period in 2024[120] - Adjusted EBITDA for the Safety & Infrastructure segment increased by $14.6 million, or 93.8%, to $30.2 million for the three months ended December 26, 2025, compared to $15.6 million for the same period in 2024[122] Cash Flow and Liquidity - Cash and cash equivalents were $443.8 million as of December 26, 2025, with $98.2 million held at non-U.S. subsidiaries[123] - The Company has access to an ABL Credit Facility with an estimated borrowing base of $325.0 million, with no outstanding borrowings as of December 26, 2025[124] - For the three months ended December 26, 2025, the company used $55.5 million in operating activities, a decrease of $129.9 million compared to $74.4 million provided in the same period in 2024[133] - The decrease in cash provided by operating activities was primarily due to a decline in operating income of $47.9 million, partially offset by a reduction in working capital used of $100.3 million[133] - In investing activities, the company used $6.6 million during the three months ended December 26, 2025, compared to $41.1 million in the same period in 2024, marking a decrease of $47.8 million[134] - The reduction in cash used for investing activities was mainly due to a decrease of $29.5 million in capital expenditures and proceeds from the sale of Tectron Tube amounting to $18.4 million[134] - Financing activities provided $15.3 million during the three months ended December 26, 2025, compared to $67.7 million used in the same period in 2024, reflecting a decrease of $50.0 million in cash used for stock repurchases[135] Risks and Forward-Looking Statements - The company cautions that forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from expectations[139] - Key risks include economic conditions, competition, supply chain disruptions, and regulatory changes that could impact financial performance[140] - The company emphasizes that comparisons of results for current and prior periods should only be viewed as historical data and not indicative of future performance[142] - There have been no material changes to the disclosures about market risks previously reported[143] Accounting Policies - There have been no material changes in critical accounting policies and estimates since the last Annual Report[136]