Carlisle Companies, Inc. (NYSE:CSL) Q3 2023 Earnings Conference Call October 26, 2023 5:00 PM ET Company Participants Mehul Patel - VP, IR Christian Koch - Chairman, President & CEO Kevin Zdimal - VP & CFO Conference Call Participants Timothy Wojs - Robert W. Baird Bryan Blair - Oppenheimer & Co. Saree Boroditsky - Jefferies Garik Shmois - Loop Capital Markets David MacGregor - Longbow Research Adam Baumgarten - Zelman & Associates Operator Good afternoon. My name Ina, and I will be your conference ope ...

PART I—Financial Information [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Unaudited condensed consolidated financial statements for Q3 2023 show decreased revenues and net income from continuing operations, reduced total assets, strong operating cash flow, and significant financing activities [Condensed Consolidated Statements of Income and Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Q3 & Nine Months 2023 vs 2022 Income Statement Highlights (in millions, except per share amounts) | Metric | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | $1,259.8 | $1,497.0 | $3,459.4 | $4,299.5 | | **Operating Income** | $299.9 | $324.0 | $729.2 | $995.3 | | **Income from Continuing Operations** | $216.9 | $233.3 | $527.2 | $705.0 | | **Net Income** | $265.6 | $254.7 | $561.9 | $749.8 | | **Diluted EPS (Continuing Operations)** | $4.32 | $4.42 | $10.32 | $13.35 | | **Diluted EPS (Total)** | $5.29 | $4.83 | $11.00 | $14.20 | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance Sheet Highlights (in millions) | Account | Sep 30, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $108.0 | $364.8 | | Total current assets | $3,657.0 | $2,245.0 | | **Total Assets** | **$6,816.0** | **$7,222.0** | | Long-term debt, less current portion | $2,283.2 | $2,281.1 | | **Total Liabilities** | **$3,892.2** | **$4,197.6** | | **Total Stockholders' Equity** | **$2,923.8** | **$3,024.4** | - Assets held for sale increased significantly from $2,371.8 million ($599.8 million current + $1,772.0 million long-term) at year-end 2022 to $2,259.4 million (all current) as of September 30, 2023, reflecting the planned divestitures of the CFT and CIT segments[8](index=8&type=chunk)[59](index=59&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Nine Months Ended Sep 30 Cash Flow Summary (in millions) | Category | 2023 | 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $812.4 | $588.6 | | Net cash used in investing activities | $(86.7) | $(10.7) | | Net cash used in financing activities | $(994.5) | $(273.2) | | **Change in cash and cash equivalents** | **$(268.8)** | **$301.0** | - Financing activities in the first nine months of 2023 were primarily driven by **$580.0 million** in common stock repurchases and a **$300.0 million** repayment of notes[10](index=10&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) - Total stockholders' equity decreased from **$3,024.4 million** at the end of 2022 to **$2,923.8 million** as of September 30, 2023, primarily due to **$585.3 million** in share repurchases and **$119.5 million** in dividends, which more than offset the **$561.9 million** in net income[16](index=16&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the basis of presentation, segment information, and significant events, including the reclassification of CFT and CIT segments to discontinued operations and the company's continuing focus on CCM and CWT - The company's results are now reported through two segments: Carlisle Construction Materials (CCM) and Carlisle Weatherproofing Technologies (CWT)[60](index=60&type=chunk)[61](index=61&type=chunk) - The Carlisle Fluid Technologies (CFT) and Carlisle Interconnect Technologies (CIT) segments have been reclassified as discontinued operations, with assets and liabilities held for sale, consistent with the company's pivot to a pure-play building products company[59](index=59&type=chunk)[67](index=67&type=chunk) - On September 1, 2023, the company redeemed its **$300.0 million** 0.55% unsecured senior notes due 2023[105](index=105&type=chunk) - Subsequent to the quarter's end, on October 2, 2023, the company completed the sale of CFT for **$520 million** in gross cash proceeds, and on October 11, 2023, agreed to acquire assets from Polar Industries for **$36.0 million**[21](index=21&type=chunk)[22](index=22&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's strategic pivot to a pure-play building products company, resilient Q3 operating margins despite revenue decline, strong capital deployment, and plans for 'Vision 2030' - The company has effectively completed its portfolio restructuring, or "Pivot", to become a pure-play building products company, with the CIT segment reclassified to discontinued operations[26](index=26&type=chunk)[27](index=27&type=chunk) - In the first nine months of 2023, the company returned **$119.3 million** in dividends and repurchased **$580.0 million** of its shares[29](index=29&type=chunk) - Management plans to release its new strategic vision, 'Vision 2030', in December 2023, which will build upon the successes of 'Vision 2025' with a focus on building products[31](index=31&type=chunk) [Consolidated Results of Operations](index=22&type=section&id=Consolidated%20Results%20of%20Operations) Consolidated Revenue Change (in millions) | Period | 2023 Revenue | 2022 Revenue | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Q3** | $1,259.8 | $1,497.0 | $(237.2) | (15.8)% | | **YTD** | $3,459.4 | $4,299.5 | $(840.1) | (19.5)% | - Revenue decreased primarily due to lower sales in non-residential and residential construction end markets, caused by project delays, higher interest rates, and prolonged distributor destocking[34](index=34&type=chunk)[38](index=38&type=chunk) - Gross margin percentage increased in Q3 2023 to **37.0%** from 34.4% in Q3 2022, driven by lower raw material costs; for the nine-month period, gross margin percentage was flat at **35.1%**[40](index=40&type=chunk) - Operating margin for Q3 2023 increased to **23.8%** from 21.6% year-over-year, primarily due to lower raw material costs; however, for the first nine months, operating margin decreased to **21.1%** from 23.1% due to lower sales volumes[35](index=35&type=chunk)[45](index=45&type=chunk) [Segment Results of Operations](index=25&type=section&id=Segment%20Results%20of%20Operations) Q3 2023 Segment Performance (in millions) | Segment | Revenue | % Change YoY | Operating Income | Operating Margin | | :--- | :--- | :--- | :--- | :--- | | **CCM** | $914.0 | (16.2)% | $272.5 | 29.8% | | **CWT** | $345.8 | (15.0)% | $58.8 | 17.0% | - Carlisle Construction Materials (CCM) revenue decreased due to market underperformance and distributor destocking, with operating margin declining from higher per-unit costs due to lower volumes[77](index=77&type=chunk) - Carlisle Weatherproofing Technologies (CWT) revenue decreased due to a slowdown in residential construction, but its operating margin increased significantly, reflecting operating efficiencies, strategic sourcing, and synergies from a prior acquisition[131](index=131&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) - Total cash and cash equivalents decreased from **$364.8 million** at the end of 2022 to **$108.0 million** as of September 30, 2023, primarily due to share repurchases, debt repayment, and dividends, partially offset by cash from operations[132](index=132&type=chunk) - Operating cash flow for the first nine months of 2023 increased to **$812.4 million** from $588.6 million in the prior year, mainly due to favorable working capital changes[138](index=138&type=chunk) - The company maintains a **$1.0 billion** revolving credit facility, which had no outstanding balance as of September 30, 2023[142](index=142&type=chunk) [Outlook](index=31&type=section&id=Outlook) Q4 2023 Revenue Outlook vs. Q4 2022 | Segment | Expected Revenue Change | | :--- | :--- | | CCM | -3% to -5% | | CWT | ~ -10% | | **Total CSL** | **-5% to -7%** | - For Q4 2023, the company expects corporate expenses of **~$30 million**, D&A of **~$40 million**, capex of **~$40 million**, net interest expense of **~$13 million**, and a base tax rate of **23% to 24%**[158](index=158&type=chunk) [Quantitative and Qualitative Disclosure about Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) The company reports no material changes in its market risk during the first nine months of 2023, referring to its 2022 Annual Report on Form 10-K for detailed information - There have been no material changes in the Company's market risk for the nine months ended September 30, 2023[161](index=161&type=chunk) [Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded the company's disclosure controls and procedures were effective as of September 30, 2023, with no material changes to internal control over financial reporting during Q3 - As of September 30, 2023, the Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures are effective[162](index=162&type=chunk) - No changes in the Company's internal control over financial reporting occurred during the third quarter of 2023 that have materially affected, or are reasonably likely to materially affect, internal controls[163](index=163&type=chunk) PART II—Other Information [Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings arising in the ordinary course of business, with specific details provided in Note 14 of the financial statements - Information about legal proceedings, including asbestos-related claims, is included in Note 14 of the financial statements[165](index=165&type=chunk)[122](index=122&type=chunk) [Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the company's risk factors as disclosed in its 2022 Annual Report on Form 10-K - There have been no material changes in the Company's risk factors from those disclosed in the 2022 Annual Report on Form 10-K[166](index=166&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q3 2023, the company repurchased 1.2 million shares of common stock, and the Board approved a 7.5 million share increase to the repurchase program, leaving 8.6 million shares available Share Repurchases for Q3 2023 | Month | Total Shares Purchased (millions) | Average Price Paid Per Share | | :--- | :--- | :--- | | July | 0.4 | $266.52 | | August | 0.5 | $274.32 | | September | 0.3 | $267.34 | | **Total** | **1.2** | **N/A** | - On August 3, 2023, the Board of Directors approved a **7.5 million** share increase in the share repurchase program; as of the end of the quarter, **8.6 million** shares remained available for repurchase[167](index=167&type=chunk) [Other Information](index=33&type=section&id=Item%205.%20Other%20Information) The company reported that no directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during Q3 2023 - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during the fiscal quarter ended September 30, 2023[171](index=171&type=chunk)

Forward Looking Statements & Non-GAAP Financial Measures VISION FARLISLE 2025 THE NEXT 100 YEARS This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally use words such as "expect," "foresee," "anticipate," "believe," "project," "should," "estimate," "will," "plans," "intends," "forecast," and similar expressions, and reflect our expectations concerning the future. Such statements are made based on ...

Carlisle Companies, Inc. (NYSE:CSL) Q2 2023 Earnings Conference Call July 26, 2023 5:00 PM ET Company Participants James Giannakouros - VP, IR Christian Koch - Chairman, President & CEO Kevin Zdimal - VP & CFO Conference Call Participants Bryan Blair - Oppenheimer Timothy Wojs - Robert W. Baird & Co. Garik Shmois - Loop Capital Markets Saree Boroditsky - Jefferies Daniel Oppenheim - Crédit Suisse David MacGregor - Longbow Research Adam Baumgarten - Zelman & Associates Operator Good afternoon. My name is JP ...

| --- | --- | --- | --- | --- | --- | --- | --- | --- | |------------------------------|-------|-------|-------|----------------|-------|-------------------------|-------|---------| | (in millions) | | CCM | Three | Months \nCWT | Ended | June 30, 2023 \nCIT | | Total | | General construction: | | | | | | | | | | Non-residential | $ | 872.5 | $ | 147.0 | $ | — | $ | 1,019.5 | | Residential | | 75.0 | | 165.5 | | — | | 240.5 | | Total construction | | 947.5 | | 312.5 | | — | | 1,260.0 | | Aerospace | | — | | ...

Carlisle Companies Incorporated (NYSE:CSL) Q1 2023 Earnings Conference Call April 27, 2023 5:00 PM ET Company Participants Jim Giannakouros - Vice President of Investor Relations Chris Koch - Chair President & Chief Executive Officer Kevin Zdimal - Chief Financial Officer Dave Smith - Vice President of Sustainability Conference Call Participants Bryan Blair - Oppenheimer Tim Wojs - Baird Saree Boroditsky - Jefferies Garik Shmois - Loop Capital John Joyner - BMO Capital Markets Adam Baumgarten - Zelman & Ass ...

Financial Performance - Revenues for Q1 2023 decreased to $1,178.8 million, down 21.2% from $1,496.3 million in Q1 2022[89] - Operating income fell to $141.0 million, resulting in an operating margin of 12.0%, compared to 18.5% in the previous year[101] - Income from continuing operations decreased to $99.6 million, with diluted earnings per share from continuing operations at $1.92, down from $3.67[89] - Revenues for Carlisle Construction Materials segment decreased by 34.6% to $576.0 million in Q1 2023 from $881.1 million in Q1 2022[113] - Operating income for Carlisle Construction Materials segment fell by 53.1% to $122.4 million in Q1 2023 from $261.1 million in Q1 2022[113] - Revenues for Carlisle Weatherproofing Technologies segment decreased by 11.8% to $316.6 million in Q1 2023 from $359.1 million in Q1 2022[116] - Operating income for Carlisle Interconnect Technologies segment increased to $10.9 million in Q1 2023 from a loss of $2.5 million in Q1 2022[122] - The company reported net income of $101.7 million for Q1 2023, down from $193.6 million in Q1 2022, primarily due to lower income from continuing operations[144] Cash Flow and Investments - Operating cash flow generated in Q1 2023 was $149.6 million, utilized for stockholder returns and capital expenditures[93] - Total cash and cash equivalents increased to $423.9 million as of March 31, 2023, compared to $400.0 million as of December 31, 2022[128] - Operating cash flows for the first three months of 2023 were $149.6 million, up from $44.3 million in the same period of 2022, reflecting lower working capital uses[133] - Cash used in investing activities was $31.7 million in Q1 2023, primarily due to capital expenditures of $40.2 million, offset by proceeds from equipment sales of $8.0 million[135] - Cash used in financing activities totaled $94.8 million in Q1 2023, mainly for share repurchases of $50.0 million and cash dividends of $38.9 million, with a quarterly dividend increase to $0.75 per share[136] Research and Development - Research and development expenses increased by 26.0% to $15.5 million, reflecting higher new product development costs[98] - New product launches include a 16-foot TPO product and ReadyFlash technology aimed at reducing installation times[84] Market Conditions and Outlook - The anticipated seasonal ramp in construction activity is underway, with improved orders and shipments noted in April 2023[83] - The company maintains a strong backlog in non-residential construction, supported by positive market indicators despite potential recession concerns[82] - The company expects a mid single-digit decline in total revenues for 2023, with specific segments projecting varying performance, including high single-digit growth in Carlisle Interconnect Technologies and Carlisle Fluid Technologies[149] Corporate Governance and Compliance - The company maintained compliance with all covenants and limitations under its debt instruments as of March 31, 2023[141] - The company has not reported any material changes in market risk for the three months ended March 31, 2023[154] Environmental Commitment - The company is committed to achieving Net-Zero greenhouse gas emissions by 2050, with initiatives including the use of bio-based raw materials[85] - The company emphasizes its commitment to reducing greenhouse gas emissions and achieving net zero commitments[151] Other Considerations - Project costs for exiting manufacturing operations in Lugano, Switzerland, are expected to total approximately $7.6 million[120] - Interest expense decreased by 16.8% to $18.8 million in Q1 2023 from $22.6 million in Q1 2022[107] - The effective income tax rate on continuing operations for Q1 2023 was 22.2%, down from 23.7% in Q1 2022[110] - Corporate expenses for 2023 are projected to be approximately $115 million, with depreciation and amortization expenses around $250 million[149] - Capital expenditures for 2023 are estimated to be between $200 million and $225 million, with net interest expense expected to be approximately $60 million[149] - The report includes forward-looking statements that may be affected by various factors, including competition, technological developments, and economic conditions[151] - There are potential impacts from geopolitical events, such as the Russian invasion of Ukraine, on market conditions and future performance[151] - The company has undertaken stock repurchases during the reporting period, although specific figures are not provided in the extracted content[154]

Table of Contents Description of Business by Segment Carlisle Construction Materials ("CCM") Products, Markets and Locations The CCM segment has evolved from a supplier of the first single-ply ethylene propylene diene monomer ("EPDM") roofing membranes in the early 1960s to today, where we deliver innovative, easy-to-install and energy-efficient solutions through the Carlisle Experience for customers who are creating the sustainable building of the future. CCM is a diversified manufacturer and supplier of p ...

Carlisle Companies Incorporated (NYSE:CSL) Q4 2022 Earnings Conference Call February 7, 2023 5:00 PM ET Company Participants Jim Giannakouros – Vice President of Investor Relations Chris Koch – Chair President and Chief Executive Officer Kevin Zdimal – Chief Financial Officer Dave Smith – Vice President of Sustainability Conference Call Participants Bryan Blair – Oppenheimer Tim Wojs – Baird Garik Shmois – Loop Capital Dan Oppenheim – Credit Suisse Saree Boroditsky – Jefferies David MacGregor – Longbow Rese ...

| --- | --- | --- | |----------------------|-----------------|---------------------------------| | | | | | Depreciation | ~$105M | We expect to drive adjusted EPS | | Amortization | ~$145M | growth y/y in 2023 | | Capital Expenditures | ~$200 – $225M | | * Reference the financial reconciliations of non-GAAP financial measures to the related GAAP financial measures. . **Interest expense, net is presented net of interest income. 16 Financial Reconciliations Non-GAAP Financial Metrics This presentation include ...