Insteel Industries, Inc. (NYSE:IIIN) Q4 2022 Earnings Conference Call October 20, 2022 10:00 AM ET Company Participants H.O. Woltz - Chairman, President, and Chief Executive Officer Mark Carano - Senior Vice President, Chief Financial Officer, and Treasurer Conference Call Participants Julio Romero - Sidoti & Co. Tyson Bauer - KC Capital Operator Good morning and a warm welcome to the Insteel Industries' Fourth Quarter 2022 Earnings Conference Call. My name is Candice, and I will be your moderator for today ...

Financial Data and Key Metrics Changes - The company reported quarterly revenue of $227.2 million, an increase of 41.3% from $160.8 million in the prior year [5] - Net earnings were $38.6 million, or $1.96 per diluted share, compared to $18.4 million or $0.84 per diluted share in the prior year, representing a 109% increase in earnings per share [5] - Average selling prices increased by 53.9% compared to the prior year and 6.3% sequentially from Q2 2022, marking the eighth consecutive quarter of rising average selling prices [6][7] Business Line Data and Key Metrics Changes - Shipments for the quarter decreased by 8.2% from last year, remaining essentially unchanged sequentially from Q2 2022 [8] - The decrease in shipments was attributed to softness in the standard welded wire mesh product line and labor availability issues [8][9] - Gross profit increased by $26.6 million or 84% from the same period last year to a record level of $58.1 million, with gross margin expanding over 600 basis points to 25.6% [10] Market Data and Key Metrics Changes - The residential market represents about 15% of the company's revenue, and while it is transitioning to a slower growth period, the overall market outlook remains positive [17] - Non-residential construction markets are expected to remain robust, with customer backlogs at near record levels [25][27] Company Strategy and Development Direction - The company is optimistic about the impact of the infrastructure investment and JOBS Act, expecting significant demand for products beginning in late 2022 or early 2023 [27] - The company plans to closely monitor market conditions and pursue actions to maximize shipments and optimize costs, positioning itself for attractive growth opportunities [29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand for reinforcing products and the positive outlook for markets, driven by infrastructure investments [3][16] - Labor availability has emerged as a key constraint on production, with management implementing flexible work schedules to address staffing challenges [21][22] Other Important Information - Cash flow from operations for the quarter used $5 million due to increased working capital from higher inventory levels [13] - The company ended the quarter with $63 million in cash and no borrowings on its $100 million revolving credit facility [15] Q&A Session All Questions and Answers Question: Could you guys maybe just dig into standard welded wire? What percentage of sales is that typically make up of overall sales? - The company does not disclose product line details [34] Question: Would it be -- I think you guys have typically talked about 15% of your overall sales comes from residential. Does that kind of fall in line with that? - The residential market consumes both standard welded wire reinforcement and PC strand [35] Question: Is the shipments down 8.2% you talked about labor, is that very regional? - Labor availability issues are experienced across different regions, with unemployment rates ranging from 2% to 4% [49] Question: Did the timing of getting the raw materials in along with the staffing shortage contribute to revenue loss? - Yes, the company entered the third quarter with low finished goods inventories, impacting potential revenue [51] Question: Will we see a big increase in cash balances at the end of the calendar year? - Inventory balances are expected to remain higher due to a combination of more units and higher values [53]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 2, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number: 1-9929 Insteel Industries, Inc. (Exact name of registrant as specified in its charter) North Carolina (State or other jurisdic ...

INDUSTRIES INC. Investor Presentation April 21, 2022 Quener, P 1 1 1 8 L 男 Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. When used in this presentation, the words "believes," "anticipates," "expects," "estimates," "appears," "plans," "intends," "may," "should," "could" and similar expressions are intended to identify forward-looking statements. Although we believe that ...

Insteel industries, Inc. (NYSE:IIIN) Q2 2022 Earnings Conference Call April 21, 2022 10:00 AM ET Company Participants H.O. Woltz III – Chairman, President and Chief Executive Officer Mark Carano – Senior Vice President, Chief Financial Officer and Treasurer Conference Call Participants Tyson Bauer – KC Capital Julio Romero – Sidoti Operator Hello, and welcome to today's In-steel Industries. Second Quarter 2022, Earnings Call. My name is Bally and I will be your moderator for today's call. All lines will be ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 2, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number: 1-9929 Insteel Industries, Inc. (Exact name of registrant as specified in its charter) North Carolina (State or other jurisdi ...

[PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) In Q1 fiscal 2022, Insteel Industries reported significant year-over-year growth in net sales and profitability, with net earnings up 184.0% to $23.1 million, while total assets slightly decreased due to lower cash balances [Consolidated Statements of Operations and Comprehensive Income](index=4&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) The company experienced substantial growth in Q1 fiscal 2022, with net sales increasing by 49.2% and net earnings surging by 184.0% Consolidated Statements of Operations (Unaudited) | Metric | Three Months Ended Jan 1, 2022 (in thousands) | Three Months Ended Jan 2, 2021 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Net sales | $178,459 | $119,605 | +49.2% | | Gross profit | $42,364 | $19,851 | +113.4% | | Earnings before income taxes | $30,033 | $10,608 | +183.1% | | Net earnings | $23,129 | $8,143 | +184.0% | | Diluted EPS | $1.18 | $0.42 | +181.0% | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of January 1, 2022, total assets decreased to $368.8 million, primarily due to a $26.9 million reduction in cash and cash equivalents Consolidated Balance Sheet Highlights (Unaudited) | Metric (in thousands) | January 1, 2022 | October 2, 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $63,020 | $89,884 | | Total current assets | $226,804 | $246,906 | | Total assets | $368,779 | $390,710 | | Total current liabilities | $62,574 | $68,849 | | Total shareholders' equity | $286,020 | $302,038 | [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities was $13.6 million, while financing activities used significantly more cash due to a larger special dividend payment Consolidated Cash Flows (Unaudited) | Metric (in thousands) | Three Months Ended Jan 1, 2022 | Three Months Ended Jan 2, 2021 | | :--- | :--- | :--- | | Net cash provided by operating activities | $13,631 | $13,950 | | Net cash used for investing activities | ($1,076) | ($3,020) | | Net cash used for financing activities | ($39,419) | ($29,436) | | Net decrease in cash and cash equivalents | ($26,864) | ($18,506) | [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders%27%20Equity) Shareholders' equity decreased to $286.0 million, primarily due to $39.4 million in cash dividends, partially offset by $23.1 million in net earnings Changes in Shareholders' Equity (Q1 2022, in thousands) | Description | Amount | | :--- | :--- | | Balance at October 2, 2021 | $302,038 | | Net earnings | $23,129 | | Cash dividends declared | ($39,410) | | Other (stock plans, etc.) | $263 | | **Balance at January 1, 2022** | **$286,020** | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, revenue breakdown by product line, and the company's $100 million undrawn credit facility - In connection with the 2020 STM Acquisition, the company closed the Summerville facility, which was subsequently sold for net cash proceeds of **$6.8 million**, expected to result in a gain of approximately **$470,000** in the next quarter[28](index=28&type=chunk) Net Sales by Product Line (in thousands) | Product Line | Q1 2022 | Q1 2021 | | :--- | :--- | :--- | | Welded wire reinforcement | $113,393 | $74,026 | | Prestressed concrete strand | $65,066 | $45,579 | | **Total** | **$178,459** | **$119,605** | - The company has a **$100.0 million** revolving credit facility maturing in May 2024, with **$98.6 million** of borrowing capacity available and no outstanding borrowings as of January 1, 2022[53](index=53&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 49.2% increase in Q1 net sales to higher selling prices, offsetting volume declines due to raw material constraints, while maintaining a strong liquidity position [Results of Operations](index=20&type=section&id=Results%20of%20Operations) Net sales for Q1 2022 increased 49.2% to $178.5 million, driven by price increases that offset an 11.9% decrease in shipments due to raw material supply issues - The increase in net sales was driven by price increases implemented to recover escalating raw material costs amid strong product demand, while decreased shipments were due to sustained tight supply conditions for raw materials[75](index=75&type=chunk) - Gross profit increased by **$22.5 million**, primarily due to higher spreads between average selling prices and raw material costs (**$27.2 million**), partially offset by higher manufacturing costs (**$2.5 million**) and the impact of lower shipments (**$2.1 million**)[76](index=76&type=chunk) - SG&A expense increased by **$3.7 million**, largely driven by higher compensation expense (**$3.8 million**) resulting from improved financial performance[77](index=77&type=chunk) [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained a strong, debt-free balance sheet with $286.0 million in shareholders' equity, with capital expenditures for fiscal 2022 expected to be up to $25.0 million Liquidity and Capitalization | Metric (in thousands) | January 1, 2022 | January 2, 2021 | | :--- | :--- | :--- | | Net working capital | $164,230 | $122,110 | | Total debt | $0 | $0 | | Shareholders' equity | $286,020 | $243,734 | - Capital expenditures are expected to total up to **$25.0 million** for fiscal 2022, focused on growing the engineered structural mesh business and cost/productivity initiatives[87](index=87&type=chunk) - In Q1 2022, the company paid a special dividend of **$38.8 million** (**$2.00 per share**) and a regular dividend of **$582,000** (**$0.03 per share**)[89](index=89&type=chunk) [Outlook](index=24&type=section&id=Outlook) Management is optimistic for the remainder of fiscal 2022, anticipating strong market demand and infrastructure spending benefits, despite challenges from raw material shortages and cost inflation - The company is optimistic for the remainder of 2022, expecting continued strong market demand and incremental demand from the Infrastructure Investment and Jobs Act beginning in the latter half of 2022[100](index=100&type=chunk) - Significant challenges include inadequate domestic supplies of hot-rolled steel wire rod, leading to commitments for imported material, and sharply escalating costs for labor, transportation, utilities, and other purchases[101](index=101&type=chunk) - The company will continue to focus on controlling expenses, aligning production with demand, and pursuing productivity improvements and opportunistic acquisitions[102](index=102&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=24&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is exposure to commodity price fluctuations for hot-rolled carbon steel wire rod, with a hypothetical 10% increase in cost reducing Q1 2022 pre-tax earnings by $10.4 million - The company is subject to significant fluctuations in the cost and availability of its primary raw material, hot-rolled carbon steel wire rod, and does not use derivative instruments to hedge this exposure[104](index=104&type=chunk) - Based on Q1 2022 results, a **10% increase** in the price of wire rod would have resulted in a **$10.4 million** decrease in pre-tax earnings, assuming selling prices remained unchanged[104](index=104&type=chunk) [Controls and Procedures](index=25&type=section&id=Item%204.%20Controls%20and%20Procedures) The company's disclosure controls and procedures were deemed effective as of January 1, 2022, with no material changes in internal control over financial reporting during the quarter - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of January 1, 2022[107](index=107&type=chunk) - No change in internal control over financial reporting occurred during the quarter that has materially affected, or is reasonably likely to materially affect, internal controls[108](index=108&type=chunk) [PART II – OTHER INFORMATION](index=25&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=25&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various ordinary course lawsuits and claims, but management does not anticipate a material adverse effect on its financial position or results - The company is involved in ordinary course lawsuits and claims but does not expect the ultimate cost to resolve these matters will have a material adverse effect on its financial position, results of operations or cash flows[110](index=110&type=chunk) [Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) There were no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended October 2, 2021 - There have been no material changes from the risk factors set forth in the company's 2021 Annual Report[112](index=112&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=26&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) As of January 1, 2022, $24.8 million remained available for future share repurchases under the company's authorization, with no repurchases made during the quarter - As of January 1, 2022, **$24.8 million** remained available for future share repurchases under the company's authorization, with no repurchases made during the quarter[113](index=113&type=chunk) [Exhibits](index=26&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and financial data in iXBRL format - Exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906, and financial statements formatted in iXBRL[116](index=116&type=chunk)

Insteel Industries, Inc. (NYSE:IIIN) Q1 2022 Earnings Conference Call January 20, 2022 10:00 AM ET Company Participants H.O. Woltz - Chairman, President and Chief Executive Officer Mark Carano - Senior Vice President, Chief Financial Officer and Treasurer Conference Call Participants Tyson Bauer - Kansas City Capital Associates Julio Romero - Sidoti & Company Disclaimer*: This transcript is designed to be used alongside the freely available audio recording on this page. Timestamps within the transcript are ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended October 2, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-9929 INSTEEL INDUSTRIES, INC. (Exact name of registrant as specified in its charter) North Carolina (State or other jurisdiction of incorporation or ...

Financial Data and Key Metrics Changes - Insteel reported record financial performance for Q4 2021, with net earnings more than tripling to $25.2 million from $7.4 million a year ago, and earnings per diluted share rising to $1.28 from $0.38 [6][28] - Gross profit for the quarter increased by $20.5 million year-over-year, with gross margin expanding to 23.3% due to a widening in spreads as average selling prices outpaced rod cost increases [12] - SG&A expense decreased by $2 million to $7.3 million, and as a percentage of sales, it decreased 240 basis points to 4.3% [13] Business Line Data and Key Metrics Changes - Average selling prices in Q4 were up 56.1% year-over-year and increased 18.8% sequentially from Q3 2021, marking the third consecutive quarter of price increases greater than 10% [9] - Shipments for the quarter decreased 20.6% from last year and 10.3% sequentially from Q3 2021, attributed to tight global rod supply rather than lack of demand [10][11] Market Data and Key Metrics Changes - The construction end markets remained strong with no signs of a slowdown, supported by leading indicators and consensus growth estimates for construction spending [19] - Non-residential construction spending has rebounded dramatically since January 2021, with the Architectural Billings Index registering its highest monthly score in history during the summer [20][24] Company Strategy and Development Direction - The company plans to pursue important transactions for non-buy America applications to fill voids created by domestic production challenges [33] - Capital expenditures for 2022 are estimated to be between $20 million and $25 million, aimed at supporting growth in the engineered structural mesh product line and improving production quality [37] Management's Comments on Operating Environment and Future Outlook - Management expressed that the current conditions in the market are unprecedented and unsustainable, with tight supplies of hot-rolled steel rod leading to substantial price increases [28][30] - The company expects robust demand to continue supporting price increases through the supply chain, despite challenges in raw material availability [33][58] Other Important Information - Free cash flow for the year was $52.4 million, representing 8.9% of revenues, with $31.3 million returned to shareholders through dividends [18] - The effective tax rate for the quarter increased to 22.7% from 20.8% year-over-year, with expectations of around 23% for the next year barring changes in corporate tax rates [15] Q&A Session Summary Question: Was the decrease in shipments due to weather or tight wire rod supply? - Management indicated that while there was some production time lost due to hurricanes, the primary reason for the decrease in shipments was related to supply concerns [39] Question: Have there been any recent changes in foreign wire rod availability? - Management acknowledged that there are some opportunities emerging, but global markets remain strong, limiting imports [40] Question: What is the impact of wire rod supply on shipments? - Management confirmed that the entire shipment shortfall is related to wire rod availability, not demand, with a pro forma decrease of about 14.5% [53] Question: Will pricing soften if supply improves? - Management believes that pricing will remain firm even with increased wire rod supply due to strong market demand [58] Question: What are the implications of the infrastructure bill? - Management expressed concerns that the Bipartisan Infrastructure Bill may be inflationary and questioned the necessity of stimulating the industry at this time [61][63]