Market Newsdesk

January 19, 2023 6:58 am

P&G Announces Fiscal Year 2023 Second Quarter Results

P&G Announces Fiscal Year 2023 Second Quarter Results

Net Sales -1%; Organic Sales +5%;

Diluted EPS and Core EPS $1.59, each -4%

RAISES SALES GROWTH OUTLOOK

MAINTAINS FISCAL YEAR EPS GROWTH & CASH GUIDANCE RANGES

CINCINNATI–(BUSINESS WIRE)–
The Procter & Gamble Company (NYSE:PG) reported second quarter fiscal year 2023 net sales of $20.8 billion, a decrease of one percent versus the prior year. Excluding the impacts of foreign exchange and acquisitions and divestitures, organic sales increased five percent. Diluted net earnings per share were $1.59, a decrease of four percent versus prior year EPS.

Operating cash flow was $3.6 billion, and net earnings were $4.0 billion for the quarter. Adjusted free cash flow productivity was 72%, which is calculated as operating cash flow, less capital spending, as a percentage of net earnings. The Company returned $4.2 billion of cash to shareholders via approximately $2.2 billion of dividend payments and $2 billion of common stock repurchases.

$ billions, except EPS
Second Quarter
GAAP	2023	2022	% Change	Non-GAAP*	2023	2022	% Change
Net Sales	20.8	21.0	(1)%	Organic Sales	n/a	n/a	5%
Diluted EPS	1.59	1.66	(4)%	Core EPS	1.59	1.66	(4)%
*Please refer to Exhibit 1 – Non-GAAP Measures for the definition and reconciliation of these measures to the related GAAP measures.

“We delivered solid results in the second quarter of fiscal year 2023 in what continues to be a very difficult cost and operating environment,” said Jon Moeller, Chairman of the Board, President and Chief Executive Officer. “Progress against our plan fiscal year to date enables us to raise our sales growth outlook for fiscal 2023 and maintain our guidance range for EPS growth despite significant headwinds. We remain committed to our integrated strategies of a focused product portfolio, superiority, productivity, constructive disruption and an agile and accountable organization structure. These strategies have enabled us to build and sustain strong momentum. They remain the right strategies to navigate through the near-term challenges we’re facing and continue to deliver balanced growth and value creation.”

October – December Quarter Discussion

Net sales in the second quarter of fiscal year 2023 were $20.8 billion, a one percent decrease versus the prior year. Unfavorable foreign exchange had a six percent impact on net sales. Organic sales, which exclude the impacts of foreign exchange and acquisitions and divestitures, increased five percent. The organic sales increase was driven by a ten percent increase from higher pricing and a one percent increase from positive product mix, partially offset by a six percent decrease in shipment volumes.

October – December 2022	Volume	Foreign Exchange	Price	Mix	Other⁽²⁾	Net Sales	Organic Volume	Organic Sales
Net Sales Drivers⁽¹⁾	Volume	Foreign Exchange	Price	Mix	Other⁽²⁾	Net Sales	Organic Volume	Organic Sales
Beauty	(4)%	(8)%	9%	(2)%	2%	(3)%	(4)%	3%
Grooming	(8)%	(9)%	11%	(3)%	—%	(9)%	(8)%	—%
Health Care	(1)%	(6)%	5%	4%	—%	2%	(1)%	8%
Fabric & Home Care	(7)%	(7)%	13%	2%	—%	1%	(7)%	8%
Baby, Feminine & Family Care	(6)%	(5)%	8%	2%	—%	(1)%	(6)%	4%
Total P&G	(6)%	(6)%	10%	1%	—%	(1)%	(6)%	5%

⁽¹⁾		Net sales percentage changes are approximations based on quantitative formulas that are consistently applied.
⁽²⁾		Other includes the sales mix impact from acquisitions and divestitures and rounding impacts necessary to reconcile volume to net sales.

Beauty segment organic sales increased three percent versus year ago. Skin and Personal Care organic sales increased low single digits due to innovation-driven volume growth and higher pricing, partially offset by negative mix from COVID-related declines in SK-II. Hair Care organic sales increased mid-single digits driven by increased pricing, partially offset by volume declines due to market contraction.

Grooming segment organic sales were unchanged versus year ago as higher pricing was fully offset by volume decline and negative mix, due to market contraction and retailer inventory reductions of appliances.

Health Care segment organic sales increased eight percent versus year ago. Oral Care organic sales increased low single digits due to increased pricing and favorable geographic mix, partially offset by volume declines due to portfolio reduction in Russia and COVID-related disruptions in Greater China. Personal Health Care organic sales increased high-teens due to increased pricing, favorable mix and volume growth driven by a strong cough, cold and flu season.

Fabric and Home Care segment organic sales increased eight percent versus year ago. Fabric Care organic sales increased high single digits due to increased pricing, partially offset by volume declines due to market contraction and increased pricing, primarily in Europe. Home Care organic sales increased high single digits due to increased pricing, partially offset by volume declines versus a high base period of increased consumption of cleaning products.

Baby, Feminine and Family Care segment organic sales increased four percent versus year ago. Baby Care organic sales increased low single digits due to increased pricing, partially offset by volume declines from market contraction. Feminine Care organic sales increased high single digits driven by increased pricing and positive geographic mix, partially offset by volume declines in emerging markets. Family Care organic sales increased low single digits due to increased pricing, partially offset by lower volumes due to market contraction and market share softness.

Diluted net earnings per share decreased by four percent to $1.59, driven by a decline in net sales and a decrease in operating margin partially offset by a lower effective tax rate and a reduction in shares outstanding. Currency-neutral EPS were up five percent versus the prior year EPS.

Gross margin for the quarter decreased 160 basis points versus year ago, 100 basis points on a currency-neutral basis. The decline was driven by 380 basis points of increased commodity and input material costs, 130 basis points of negative product mix and 140 basis points of capacity start-up costs and other impacts. These were partially offset by benefits of 470 basis points from increased pricing and 80 basis points from gross productivity savings.

Selling, general and administrative expense (SG&A) as a percentage of sales increased 10 basis points versus year ago and decreased 30 basis points on a currency-neutral basis. The decrease was driven by 130 basis points of leverage due to organic sales growth and 30 basis points of productivity savings, partially offset by 130 basis points of inflation, capability investments and other impacts.

Operating margin for the quarter decreased 170 basis points versus the prior year, 70 basis points on a currency-neutral basis. Operating margin included gross productivity savings of 110 basis points.

Fiscal Year 2023 Guidance

P&G raised its guidance for fiscal 2023 all-in sales to a range of down one percent to in-line versus the prior fiscal year from a prior range of down three percent to down one percent. The Company also raised its outlook for organic sales growth to a range of four to five percent versus the prior fiscal year from a prior growth range of three to five percent. Foreign exchange is now expected to be a five percentage point headwind to all-in sales growth for the fiscal year.

P&G maintained its outlook for fiscal 2023 diluted net earnings per share growth in the range of in-line to up four percent versus fiscal 2022 EPS of $5.81. The Company added that given continued significant cost headwinds from commodity and materials costs and foreign exchange impacts, it continues to expect EPS results to be towards the lower end of the fiscal year guidance range.

P&G said its current fiscal 2023 outlook includes headwinds of approximately $1.2 billion after-tax due to unfavorable foreign exchange rates, $2.3 billion due to higher commodity and materials costs, and $200 million from higher freight costs. Combined, these items are a $3.7 billion after-tax headwind, or approximately $1.50 per share, to fiscal 2023 earnings versus fiscal 2022, or a headwind of approximately 26 points to EPS growth. The $3.7 billion headwind is a modest sequential improvement versus guidance provided in October, due to both commodities and foreign exchange.

The Company is unable to reconcile its forward-looking non-GAAP cash flow measure and tax rate measures without unreasonable efforts because the Company cannot predict the timing and amounts of discrete cash items, such as acquisitions, divestitures, or impairments, which could significantly impact GAAP results.

P&G now expects a core effective tax rate of approximately 20% in fiscal 2023.

Capital spending is estimated to be approximately 5% of fiscal 2023 net sales.

P&G continues to expect adjusted free cash flow productivity of 90% and expects to pay around $9 billion in dividends and to repurchase $6 billion to $8 billion of common shares in fiscal 2023.

Forward-Looking Statements

Certain statements in this release, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result” and similar expressions. Forward-looking statements are based on current expectations and assumptions, which are subject to risks and uncertainties that may cause results to differ materially from those expressed or implied in the forward-looking statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events or otherwise, except to the extent required by law.

Risks and uncertainties to which our forward-looking statements are subject include, without limitation: (1) the ability to successfully manage global financial risks, including foreign currency fluctuations, currency exchange or pricing controls and localized volatility; (2) the ability to successfully manage local, regional or global economic volatility, including reduced market growth rates, and to generate sufficient income and cash flow to allow the Company to effect the expected share repurchases and dividend payments; (3) the ability to manage disruptions in credit markets or to our banking partners or changes to our credit rating; (4) the ability to maintain key manufacturing and supply arrangements (including execution of supply chain optimizations and sole supplier and sole manufacturing plant arrangements) and to manage disruption of business due to various factors, including ones outside of our control, such as natural disasters, acts of war (including the Russia-Ukraine War) or terrorism or disease outbreaks; (5) the ability to successfully manage cost fluctuations and pressures, including prices of commodities and raw materials and costs of labor, transportation, energy, pension and healthcare; (6) the ability to stay on the leading edge of innovation, obtain necessary intellectual property protections and successfully respond to changing consumer habits, evolving digital marketing and selling platform requirements and technological advances attained by, and patents granted to, competitors; (7) the ability to compete with our local and global competitors in new and existing sales channels, including by successfully responding to competitive factors such as prices, promotional incentives and trade terms for products; (8) the ability to manage and maintain key customer relationships; (9) the ability to protect our reputation and brand equity by successfully managing real or perceived issues, including concerns about safety, quality, ingredients, efficacy, packaging content, supply chain practices or similar matters that may arise; (10) the ability to successfully manage the financial, legal, reputational and operational risk associated with third-party relationships, such as our suppliers, contract manufacturers, distributors, contractors and external business partners; (11) the ability to rely on and maintain key company and third-party information and operational technology systems, networks and services and maintain the security and functionality of such systems, networks and services and the data contained therein; (12) the ability to successfully manage uncertainties related to changing political conditions and potential implications such as exchange rate fluctuations and market contraction; (13) the ability to successfully manage current and expanding regulatory and legal requirements and matters (including, without limitation, those laws and regulations involving product liability, product and packaging composition, intellectual property, labor and employment, antitrust, privacy and data protection, tax, the environment, due diligence, risk oversight, accounting and financial reporting) and to resolve new and pending matters within current estimates; (14) the ability to manage changes in applicable tax laws and regulations; (15) the ability to successfully manage our ongoing acquisition, divestiture and joint venture activities, in each case to achieve the Company’s overall business strategy and financial objectives, without impacting the delivery of base business objectives; (16) the ability to successfully achieve productivity improvements and cost savings and manage ongoing organizational changes while successfully identifying, developing and retaining key employees, including in key growth markets where the availability of skilled or experienced employees may be limited; (17) the ability to successfully manage the demand, supply and operational challenges, as well as governmental responses or mandates, associated with a disease outbreak, including epidemics, pandemics or similar widespread public health concerns (including COVID-19); (18) the ability to manage the uncertainties, sanctions and economic effects from the war between Russia and Ukraine; and (19) the ability to successfully achieve our ambition of reducing our greenhouse gas emissions and delivering progress towards our environmental sustainability priorities. For additional information concerning factors that could cause actual results and events to differ materially from those projected herein, please refer to our most recent 10-K, 10-Q and 8-K reports.

About Procter & Gamble

P&G serves consumers around the world with one of the strongest portfolios of trusted, quality, leadership brands, including Always®, Ambi Pur®, Ariel®, Bounty®, Charmin®, Crest®, Dawn®, Downy®, Fairy®, Febreze®, Gain®, Gillette®, Head & Shoulders®, Lenor®, Olay®, Oral-B®, Pampers®, Pantene®, SK-II®, Tide®, Vicks®, and Whisper®. The P&G community includes operations in approximately 70 countries worldwide. Please visit https://www.pg.com for the latest news and information about P&G and its brands. For other P&G news, visit us at https://www.pg.com/news.

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES
(Amounts in Millions Except Per Share Amounts)
Consolidated Earnings Information
	Three Months Ended December 31
	2022			2021			% Chg
NET SALES	$	20,773		$	20,953		(1)%
Cost of products sold		10,897			10,664		2%
GROSS PROFIT		9,876			10,289		(4)%
Selling, general and administrative expense		5,091			5,121		(1)%
OPERATING INCOME		4,785			5,168		(7)%
Interest expense		(171	)		(106	)	61%
Interest income		66			10		560%
Other non-operating income, net		155			167		(7)%
EARNINGS BEFORE INCOME TAXES		4,835			5,239		(8)%
Income taxes		876			997		(12)%
NET EARNINGS		3,959			4,242		(7)%
Less: Net earnings attributable to noncontrolling interests		26			19		37%
NET EARNINGS ATTRIBUTABLE TO PROCTER & GAMBLE	$	3,933		$	4,223		(7)%

EFFECTIVE TAX RATE		18.1	%		19.0	%

NET EARNINGS PER SHARE ⁽¹⁾
Basic	$	1.63		$	1.72		(5)%
Diluted	$	1.59		$	1.66		(4)%

DIVIDENDS PER COMMON SHARE	$	0.9133		$	0.8698
DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		2,481.2			2,544.2

COMPARISONS AS A % OF NET SALES							Basis Pt Chg
Gross profit		47.5	%		49.1	%	(160)
Selling, general and administrative expense		24.5	%		24.4	%	10
Operating income		23.0	%		24.7	%	(170)
Earnings before income taxes		23.3	%		25.0	%	(170)
Net earnings		19.1	%		20.2	%	(110)
Net earnings attributable to Procter & Gamble		18.9	%		20.2	%	(130)

⁽¹⁾		Basic net earnings per share and Diluted net earnings per share are calculated on Net earnings attributable to Procter & Gamble.

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES (Amounts in Millions) Consolidated Earnings Information
	Three Months Ended December 31, 2022
	Net Sales	% Change Versus Year Ago	Earnings/(Loss) Before Income Taxes	% Change Versus Year Ago	Net Earnings/(Loss)	% Change Versus Year Ago
Beauty	$3,807	(3)%	$1,145	(3)%	$911	(4)%
Grooming	1,643	(9)%	496	(14)%	404	(15)%
Health Care	3,051	2%	887	(2)%	686	(2)%
Fabric & Home Care	7,032	1%	1,538	5%	1,171	3%
Baby, Feminine & Family Care	5,065	(1)%	1,112	(6)%	848	(7)%
Corporate	175	N/A	(343)	N/A	(61)	N/A
Total Company	$20,773	(1)%	$4,835	(8)%	$3,959	(7)%

	Three Months Ended December 31, 2022
Net Sales Drivers ⁽¹⁾	Volume	Organic Volume	Foreign Exchange	Price	Mix	Other ⁽²⁾	Net Sales
Beauty	(4)%	(4)%	(8)%	9%	(2)%	2%	(3)%
Grooming	(8)%	(8)%	(9)%	11%	(3)%	—%	(9)%
Health Care	(1)%	(1)%	(6)%	5%	4%	—%	2%
Fabric & Home Care	(7)%	(7)%	(7)%	13%	2%	—%	1%
Baby, Feminine & Family Care	(6)%	(6)%	(5)%	8%	2%	—%	(1)%
Total Company	(6)%	(6)%	(6)%	10%	1%	—%	(1)%

(1)		Net sales percentage changes are approximations based on quantitative formulas that are consistently applied.
(2)		Other includes the sales mix impact from acquisitions and divestitures and rounding impacts necessary to reconcile volume to net sales.

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES (Amounts in Millions Except Per Share Amounts) Consolidated Statements of Cash Flows
	Six Months Ended December 31
Amounts in millions	2022			2021
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD	$	7,214		$	10,288
OPERATING ACTIVITIES
Net earnings		7,922			8,368
Depreciation and amortization		1,316			1,395
Share-based compensation expense		250			268
Deferred income taxes		(398	)		(101	)
Gain on sale of assets		(3	)		(82	)
Changes in:
Accounts receivable		(654	)		(644	)
Inventories		(655	)		(840	)
Accounts payable, accrued and other liabilities		177			1,431
Other operating assets and liabilities		(535	)		(84	)
Other		224			53
TOTAL OPERATING ACTIVITIES		7,644			9,764
INVESTING ACTIVITIES
Capital expenditures		(1,598	)		(1,717	)
Proceeds from asset sales		8			97
Acquisitions, net of cash acquired		(76	)		(349	)
Other investing activity		344			3
TOTAL INVESTING ACTIVITIES		(1,322	)		(1,966	)
FINANCING ACTIVITIES
Dividends to shareholders		(4,486	)		(4,353	)
Additions to short-term debt with original maturities of more than three months		10,447			6,747
Reductions in short-term debt with original maturities of more than three months		(3,260	)		(1,730	)
Net reductions to other short-term debt		(1,759	)		(1,124	)
Additions to long-term debt		—			2,136
Reductions in long-term debt		(1,877	)		(1,673	)
Treasury stock purchases		(6,002	)		(7,504	)
Impact of stock options and other		437			1,215
TOTAL FINANCING ACTIVITIES		(6,500	)		(6,286	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH, CASH EQUIVALENTS AND RESTRICTED CASH		(182	)		(256	)
CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH		(360	)		1,256
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD	$	6,854		$	11,544

THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES (Amounts in Millions Except Per Share Amounts) Condensed Consolidated Balance Sheets
	December 31, 2022		June 30, 2022
Cash and cash equivalents	$	6,854	$	7,214
Accounts receivable		5,767		5,143
Inventories		7,541		6,924
Prepaid expenses and other current assets		1,704		2,372
TOTAL CURRENT ASSETS		21,866		21,653
Property, plant and equipment, net		21,167		21,195
Goodwill		39,951		39,700
Trademarks and other intangible assets, net		23,594		23,679
Other noncurrent assets		11,137		10,981
TOTAL ASSETS	$	117,715	$	117,208

Accounts payable	$	14,153	$	14,882
Accrued and other liabilities		10,293		9,554
Debt due within one year		14,300		8,645
TOTAL CURRENT LIABILITIES		38,746		33,081
Long-term debt		20,582		22,848
Deferred income taxes		6,462		6,809
Other noncurrent liabilities		7,200		7,616
TOTAL LIABILITIES		72,990		70,354
TOTAL SHAREHOLDERS’ EQUITY		44,725		46,854
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	117,715	$	117,208

The Procter & Gamble Company

Exhibit 1: Non-GAAP Measures

The following provides definitions of the non-GAAP measures used in Procter & Gamble’s January 19, 2023 earnings release and the reconciliation to the most closely related GAAP measures. Management believes that these non-GAAP measures provide useful perspective on underlying business trends and provide a supplemental measure of period-to-period financial results. Disclosing these non-GAAP financial measures allows investors and management to view our operating results excluding the impact of items that are not reflective of the underlying operating performance. Management uses these non-GAAP measures in making operating decisions, allocating financial resources and for business strategy purposes. Certain of these measures are also used to evaluate senior management and are a factor in determining their at-risk compensation. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results prepared in accordance with GAAP. Our non-GAAP financial measures do not represent a comprehensive basis of accounting. Therefore, our non-GAAP financial measures may not be comparable to similarly titled measures reported by other companies. The Company is not able to reconcile its forward-looking non-GAAP cash flow and tax rate measures because the Company cannot predict the timing and amounts of discrete items such as acquisition and divestitures, which could significantly impact GAAP results.

Organic sales growth: Organic sales growth is a non-GAAP measure of sales growth excluding the impacts of acquisitions and divestitures and foreign exchange from year-over-year comparisons. We believe this measure provides investors with a supplemental understanding of underlying sales trends by providing sales growth on a consistent basis. This measure is used in assessing achievement of management goals for at-risk compensation.

Currency-neutral operating margin: Currency-neutral operating margin is a measure of the Company’s operating margin excluding the incremental current year impact of foreign exchange. Management believes this non-GAAP measure provides a supplemental perspective to the Company’s operating efficiency over time.

Currency-neutral gross margin: Currency-neutral gross margin is a measure of the Company’s gross margin excluding the incremental current year impact of foreign exchange. Management believes this non-GAAP measure provides a supplemental perspective to the Company’s operating efficiency over time.

Currency-neutral selling, general and administrative (SG&A) expense as a percentage of net sales: Currency-neutral SG&A expense as a percentage of net sales is a measure of the Company’s selling, general and administrative expenses excluding the incremental current year impact of foreign exchange. Management believes this non-GAAP measure provides a supplemental perspective to the Company’s operating efficiency over time.

Core EPS: Core earnings per share, or Core EPS, is a measure of the Company’s diluted net earnings per share adjusted as indicated. Management views this non-GAAP measure as a useful supplemental measure of Company performance over time. This measure is also used when evaluating senior management in determining their at-risk compensation. For the period covered by this release, there are no reconciling items for Core EPS.

Currency-neutral EPS: Currency-neutral EPS is a measure of the Company’s EPS excluding the incremental current year impact of foreign exchange. Management views this non-GAAP measure as a useful supplemental measure of Company performance over time.

Adjusted free cash flow: Adjusted free cash flow is defined as operating cash flow less capital spending. Adjusted free cash flow represents the cash that the Company is able to generate after taking into account planned maintenance and asset expansion. Management views adjusted free cash flow as an important measure because it is one factor used in determining the amount of cash available for dividends, share repurchases, acquisitions and other discretionary investments.

Adjusted free cash flow productivity: Adjusted free cash flow productivity is defined as the ratio of adjusted free cash flow to net earnings. Management views adjusted free cash flow productivity as a useful measure to help investors understand P&G’s ability to generate cash. Adjusted free cash flow productivity is used by management in making operating decisions, allocating financial resources and for budget planning purposes. This measure is also used in assessing the achievement of management goals for at-risk compensation.


THE PROCTER & GAMBLE COMPANY AND SUBSIDIARIES (Amounts in Millions Except Per Share Amounts) Reconciliation of Non-GAAP Measures
	Three Months Ended December 31, 2022			Three Months Ended December 31, 2021
	AS REPORTED (GAAP)			AS REPORTED (GAAP)
COST OF PRODUCTS SOLD	$	10,897		$	10,664
GROSS PROFIT		9,876			10,289
GROSS MARGIN		47.5	%		49.1	%
CURRENCY IMPACT TO GROSS MARGIN		0.6	%
CURRENCY-NEUTRAL GROSS MARGIN		48.1	%
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE		5,091			5,121
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE AS A % OF NET SALES		24.5	%		24.4	%
CURRENCY IMPACT TO SELLING, GENERAL AND ADMINISTRATIVE EXPENSE AS A % OF NET SALES		(0.4	)%
CURRENCY-NEUTRAL SELLING, GENERAL AND ADMINISTRATIVE EXPENSE AS A % OF NET SALES		24.1	%
OPERATING INCOME		4,785			5,168
OPERATING MARGIN		23.0	%		24.7	%
CURRENCY IMPACT TO OPERATING MARGIN		1.0	%
CURRENCY-NEUTRAL OPERATING MARGIN		24.0	%
NET EARNINGS ATTRIBUTABLE TO P&G		3,933			4,223

DILUTED NET EARNINGS PER COMMON SHARE ⁽¹⁾	$	1.59		$	1.66
CURRENCY IMPACT TO EARNINGS	$	0.16
CURRENCY-NEUTRAL CORE EPS	$	1.75
DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		2,481.2			2,544.2
COMMON SHARES OUTSTANDING – December 31, 2022		2,359.1
⁽¹⁾ Diluted net earnings per share are calculated on Net earnings attributable to Procter & Gamble.

CHANGE IN CURRENT YEAR REPORTED (GAAP) AND NON-GAAP MEASURES VERSUS PRIOR YEAR REPORTED (GAAP) MEASURES
GROSS MARGIN	(160	)	BPS
CURRENCY-NEUTRAL GROSS MARGIN	(100	)	BPS
SELLING GENERAL & ADMINISTRATIVE EXPENSE AS A % OF NET SALES	10		BPS
CURRENCY-NEUTRAL SELLING GENERAL & ADMINISTRATIVE EXPENSE AS A % OF NET SALES	(30	)	BPS
OPERATING MARGIN	(170	)	BPS
CURRENCY-NEUTRAL OPERATING MARGIN	(70	)	BPS
EPS	(4	)%
CURRENCY-NEUTRAL EPS	5	%

Organic sales growth:

October – December 2022	Net Sales Growth	Foreign Exchange Impact	Acquisition & Divestiture Impact/Other⁽¹⁾	Organic Sales Growth
Beauty	(3)%	8%	(2)%	3%
Grooming	(9)%	9%	—%	—%
Health Care	2%	6%	—%	8%
Fabric & Home Care	1%	7%	—%	8%
Baby, Feminine & Family Care	(1)%	5%	—%	4%
Total P&G	(1)%	6%	—%	5%

⁽¹⁾

Acquisitions/Divestiture Impact/Other includes the volume and mix impact of acquisitions and divestitures and rounding impacts necessary to reconcile net sales to organic sales.

Total P&G

Net Sales Growth

Combined Foreign Exchange &

Acquisition/Divestiture Impact/Other⁽¹⁾

Organic Sales

Growth

FY 2023 (Estimate)

(1)% to 0%

+5%

+4% to +5%

⁽¹⁾		Acquisitions/Divestiture Impact/Other includes the volume and mix impact of acquisitions and divestitures and rounding impacts necessary to reconcile net sales to organic sales.

Adjusted free cash flow (dollar amounts in millions):

Three Months Ended December 31, 2022
Operating Cash Flow	Capital Spending	Adjusted Free Cash Flow
$3,574	$(708)	$2,866

Adjusted free cash flow productivity (dollar amounts in millions):

Three Months Ended December 31, 2022
Adjusted Free Cash Flow	Net Earnings	Adjusted Free Cash Flow Productivity
$2,866	$3,959	72%

Category: PG-IR

View source version on businesswire.com: https://www.businesswire.com/news/home/20230118005970/en/

P&G Media Contacts:

Erica Noble, 513.271.1793

Jennifer Corso, 513.983.2570

P&G Investor Relations Contact:

John Chevalier, 513.983.9974

KEYWORDS: Ohio United States North America

INDUSTRY KEYWORDS: Family Consumer Restaurant/Bar Other Retail Parenting Children Supermarket Baby/Maternity Specialty Office Products Food/Beverage Fashion Cosmetics Retail Convenience Store Online Retail Other Consumer Discount/Variety Home Goods Department Stores Women Men

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January 19, 2023 6:58 am

Dollar General Extends Financial Services with Ibotta Partnership

Dollar General Extends Financial Services with Ibotta Partnership

Cash Back Rewards Program Seeks to Stretch Customers’ Budgets and Drive Loyalty

GOODLETTSVILLE, Tenn.–(BUSINESS WIRE)–
Today, Dollar General (NYSE: DG) announced a partnership with Ibotta, which will extend Dollar General’s financial services and offer cash back options to all consumers.

“We are excited to provide an additional innovative option for our customers to help stretch their budgets,” said Emily Taylor, Dollar General’s executive vice president and chief merchandising officer. “Ibotta’s cash back rewards program further complements our continuous efforts to provide financial offerings and rewards to customers alongside our everyday low prices.”

As part of the partnership, Dollar General will join the Ibotta Performance Network (IPN), the first digital network that enables promotions to be delivered in a coordinated fashion across retailer platforms, large third-party publisher sites, and Ibotta’s leading direct-to-consumer properties. Dollar General is the first retailer in its channel to join the IPN.

Consumers can currently receive cash back rewards on thousands of items at Dollar General through Ibotta’s platform and expect cash back rewards available directly through Dollar General’s app and website by spring 2023.

“Dollar General has enjoyed explosive growth because of its innovative approach to helping consumers stretch their budgets,” said Bryan Leach, Ibotta’s founder and CEO. “Partnering with like-minded brands is a priority for us, and Dollar General is deeply committed to creating maximum value for their customers through seamless, customized programs that help save them even more money.”

Dollar General’s partnership with Ibotta builds on the Company’s March 2022 announcement of enhanced financial services, which includes its exclusive spendwell™ banking platform and FIS Worldpay® card rewards points payment options.

About Dollar General Corporation

Dollar General Corporation has been delivering value to shoppers for more than 80 years. Dollar General helps shoppers Save time. Save money. Every day.® by offering products that are frequently used and replenished, such as food, snacks, health and beauty aids, cleaning supplies, basic apparel, housewares and seasonal items at everyday low prices in convenient neighborhood locations. Dollar General operated 18,818 stores in 47 states as of October 28, 2022. In addition to high-quality private brands, Dollar General sells products from America’s most-trusted manufacturers such as Clorox, Energizer, Procter & Gamble, Hanes, Coca-Cola, Mars, Unilever, Nestle, Kimberly-Clark, Kellogg’s, General Mills, and PepsiCo. Learn more about Dollar General at www.dollargeneral.com.

About Ibotta

Headquartered in Denver, Colo., Ibotta (“I bought a…”) is a free-to-use cash back rewards platform that has delivered more than $1.1 billion in cumulative cash rewards to its users for making purchases in-store, on mobile apps, or via websites. Launched in 2012, Ibotta has more than 40 million downloads, is one of the most frequently used shopping and payments platforms in the United States and offers cash back on purchases on more than 2,700 leading brands and retail partners. In addition to its owned properties, Ibotta also powers rewards programs for top retailers and makes its offer content available on a number of leading websites and apps through the Ibotta Performance Network. Ibotta was named to the 2021 Inc.5000 list of fastest-growing private companies in the U.S. for the fourth year in a row after debuting on the list in 2018.

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Dollar General Public Relations

1-877-944-DGPR (3477) | [email protected]

KEYWORDS: Tennessee Colorado United States North America

INDUSTRY KEYWORDS: Food/Beverage Retail Software Convenience Store Online Retail Electronic Commerce Discount/Variety Social Media Technology Mobile/Wireless Search Engine Marketing Digital Marketing Other Communications Payments Marketing Communications Supermarket Apps/Applications

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January 19, 2023 6:58 am

Ryder Fourth Quarter 2022 Earnings Conference Call Scheduled for February 15, 2023

Ryder Fourth Quarter 2022 Earnings Conference Call Scheduled for February 15, 2023

MIAMI–(BUSINESS WIRE)–
Ryder System, Inc. (NYSE: R), a leader in supply chain, dedicated transportation, and fleet management solutions, today provided details regarding its earnings conference call scheduled for February 15, 2023 at 11:00 a.m. Eastern Time. During the call, management will review fourth quarter 2022 results. The call will be webcast over the internet.

What:		Ryder System, Inc. Fourth Quarter 2022 Earnings Conference Call

Who:		Chairman and Chief Executive Officer Robert Sanchez and
		Executive Vice President and Chief Financial Officer John Diez

When:		Wednesday, February 15, 2023 from 11:00 a.m. to 12:00 p.m. Eastern Time

How:		Live webcast: https://globalmeet.webcasts.com/starthere.jsp?ei=1524541&tp_key=361d71917d
		upon completion of registration page

		Call Toll-Free: 888-352-6803
		Outside U.S. Call: 323-701-0225
		Audio Passcode: Ryder
		Conference Leader: Calene Candela

Replay:		Visit the Investors area of Ryder’s website at http://investors.ryder.com to access a replay of the webcast. A podcast of the call will also be available online within 24 hours after the end of the call.

The full calendar of future earnings release dates and investor events is available on Ryder’s investor website at http://investors.ryder.com.

About Ryder System, Inc.

Ryder System, Inc. (NYSE: R) is a leading logistics and transportation company. It provides supply chain, dedicated transportation, and fleet management solutions, including full service leasing, rental, and maintenance, used vehicle sales, professional drivers, transportation services, freight brokerage, warehousing and distribution, e-commerce fulfillment, and last mile delivery services, to some of the world’s most-recognized brands. Ryder provides services throughout the United States, Mexico, and Canada. In addition, Ryder manages nearly 239,000 commercial vehicles and operates more than 330 warehouses, encompassing more than 80 million square feet. Ryder is regularly recognized for its industry-leading practices in third-party logistics, technology-driven innovations, commercial vehicle maintenance, environmentally friendly solutions, corporate social responsibility, world-class safety and security programs, military veteran recruitment initiatives, and the hiring of a diverse workforce. www.ryder.com

ryder-financial

ryder-usa

View source version on businesswire.com: https://www.businesswire.com/news/home/20230118005001/en/

Media

Amy Federman

(305) 500-4989

Investor Relations

Calene Candela

(305) 500-4764

KEYWORDS: United States North America Florida

INDUSTRY KEYWORDS: Fleet Management Automotive Trucking Rail Automotive Manufacturing Logistics/Supply Chain Management Transport Manufacturing

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January 19, 2023 6:53 am

Wallbox Announces Cost Reduction Program

Wallbox Announces Cost Reduction Program

BARCELONA, Spain–(BUSINESS WIRE)–
Wallbox N.V. (NYSE:WBX) (“Wallbox”), a leading provider of electric vehicle (EV) charging and energy management solutions worldwide, today announced measures to reduce costs to better align with its 2023 full year guidance, as provided on the company’s most recent earnings call.

Reductions are balanced between operating and personnel expenses and will impact approximately 15% of the workforce. The company expects the changes to result in annualized cost savings for 2023 of approximately €50 million.

In the fourth quarter of 2022, the company also added more than €70 million in cash and availability under working capital lines. These actions are expected to provide the agility needed to navigate the current market and further strengthen its balance sheet, while allowing the company to remain committed to the long-term growth trajectory it sees ahead. As a result of these steps, the company anticipates to accelerate its path to profitability by almost one year.

“We do not make these decisions lightly. We will work hard to minimize the impact to all those affected and we sincerely thank them for their contributions”, said Enric Asunción, Co-founder and CEO. “We invested heavily in manufacturing capacity and product innovation in 2022, which improves our long-term competitive position, and sets us up well for continued growth. However, as previously discussed, near-term disruptions in global supply chains have impacted EV delivery rates, and as a result, require us to better align our cost structure with the current demand environment.”

The company noted that it would be reporting results for its fourth fiscal quarter ended December 31, 2022 on March 1st, 2023.

About Wallbox

Wallbox is a global technology company, dedicated to changing the way the world uses energy. Wallbox creates advanced electric vehicle charging and energy management systems that redefine users’ relationship to the grid. Wallbox goes beyond electric vehicle charging to give users the power to control their consumption, save money, and live more sustainably. Wallbox offers a complete portfolio of charging and energy management solutions for residential, semi-public and public use in more than 113 countries. Founded in 2015 and headquartered in Barcelona, the company currently employs nearly 1,400 people in its offices in Europe, Asia, and the Americas. For additional information, please visit www.wallbox.com.

Financial Disclosure Advisory

The historical financial results included in this press release are unaudited and preliminary, and this press release does not present all information necessary for an understanding of the Company’s financial condition as of December 31, 2022 and its results of operations for the three months and year ended December 31, 2022. The Company’s actual results may differ from the preliminary estimates above due to the completion of the Company’s year-end accounting procedures, including execution of the Company’s internal control over financial reporting, and audit of the Company’s financial statements for the year ended December 31, 2022 by the Company’s independent registered public accounting firm, which are ongoing.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements contained in this press release other than statements of historical fact should be considered forward-looking statements, including, without limitation, statements regarding the Company’s cost-saving initiatives and expected financial impact therefrom and the Company’s expected future financial performance. The words “anticipate,” “believe,” “can,” “continue,” “could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “”target,” will,” “would” and similar expressions are intended to identify forward-looking statements, though not all forward-looking statements use these words or expressions. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to: Wallbox’s history of operating losses as an early stage company; the adoption and demand for electric vehicles including the success of alternative fuels, changes to rebates, tax credits and the impact of government incentives; Wallbox’s ability to successfully manage its growth; the accuracy of Wallbox’s forecasts and projections including those regarding its market opportunity; competition; risks related to health pandemics including those of COVID-19; losses or disruptions in Wallbox’s supply or manufacturing partners; impacts resulting from the conflict between Russia and Ukraine; risks related to macroeconomic conditions and inflation; Wallbox’s reliance on the third-parties outside of its control; risks related to Wallbox’s technology, intellectual property and infrastructure; as well as the other important factors discussed and incorporated by reference under the heading “Risk Factors” in Wallbox’s Registration Statement, as amended, on Form F-3 (File No. 333-268792) filed on December 14, 2022, and as such factors may be updated from time to time in its other filings with the Securities and Exchange Commission (the “SEC”), accessible on the SEC’s website at www.sec.gov and the Investors Relations section of Wallbox’s website at investors.wallbox.com. Any such forward-looking statements represent management’s estimates as of the date of this press release. Any forward-looking statement that Wallbox makes in this press release speaks only as of the date of such statement. Except as required by law, Wallbox disclaims any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise.

Source: Wallbox NV

View source version on businesswire.com: https://www.businesswire.com/news/home/20230119005385/en/

Wallbox Investor Contact:

Matt Tractenberg

VP, Investor Relations

[email protected]

+1 404-574-1504

Wallbox Public Relations Contact:

Elyce Behrsin

Public Relations

[email protected]

+34 673 310 905

KEYWORDS: Spain Europe

INDUSTRY KEYWORDS: Hardware EV/Electric Vehicles Alternative Vehicles/Fuels Automotive Consumer Electronics Technology General Automotive Vehicle Technology

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January 19, 2023 6:53 am

Fastenal Company Reports 2022 Annual and Fourth Quarter Earnings

Fastenal Company Reports 2022 Annual and Fourth Quarter Earnings

WINONA, Minn.–(BUSINESS WIRE)–
Fastenal Company (Nasdaq:FAST), a leader in the wholesale distribution of industrial and construction supplies, today announced its financial results for the quarter and year ended December 31, 2022. Except for share and per share information, or as otherwise noted below, dollar amounts are stated in millions. Throughout this document, percentage and dollar calculations, which are based on non-rounded dollar values, may not be able to be recalculated using the dollar values included in this document due to the rounding of those dollar values. References to daily sales rate (DSR) change may reflect either growth (positive) or contraction (negative) for the applicable period.

PERFORMANCE SUMMARY

	Twelve-month Period							Three-month Period
		2022		2021		Change			2022		2021		Change
Net sales	$	6,980.6		6,010.9		16.1	%	$	1,695.6		1,531.8		10.7	%
Business days		254		253					62		62
Daily sales	$	27.5		23.8		15.7	%	$	27.3		24.7		10.7	%
Gross profit	$	3,215.8		2,777.2		15.8	%	$	768.4		712.9		7.8	%
% of net sales		46.1	%	46.2	%				45.3	%	46.5	%
Operating and administrative expenses	$	1,762.2		1,559.8		13.0	%	$	435.4		412.0		5.7	%
% of net sales		25.2	%	26.0	%				25.7	%	26.9	%
Operating income	$	1,453.6		1,217.4		19.4	%	$	333.0		300.9		10.7	%
% of net sales		20.8	%	20.3	%				19.6	%	19.6	%
Earnings before income taxes	$	1,440.0		1,207.8		19.2	%	$	328.2		298.5		9.9	%
% of net sales		20.6	%	20.1	%				19.4	%	19.5	%
Net earnings	$	1,086.9		925.0		17.5	%	$	245.6		231.2		6.2	%
Diluted net earnings per share	$	1.89		1.60		17.8	%	$	0.43		0.40		7.1	%

Quarterly Results of Operations

Net sales increased $163.8, or 10.7%, in the fourth quarter of 2022 when compared to the fourth quarter of 2021. The number of business days were the same in both periods. We experienced higher unit sales in the fourth quarter of 2022 that contributed to the increase in net sales in the period. This was due to further growth in underlying demand in markets tied to industrial capital goods and commodities, which more than offset softer markets tied to consumer goods and relatively lower growth in construction. Foreign exchange negatively affected sales in the fourth quarter of 2022 by approximately 90 basis points.

The overall impact of product pricing on net sales in the fourth quarter of 2022 was 350 to 380 basis points compared to the fourth quarter of 2021. The increase is from actions taken over the past twelve months intended to mitigate the impact of marketplace inflation for our products, particularly fasteners, and transportation services. We did not take any broad pricing actions in the fourth quarter of 2022, and price levels in the market remained stable. The favorable impact of product pricing moderated in the fourth quarter of 2022 relative to the third quarter of 2022 due to comparisons against initial price events that began in the third quarter of 2021. Spot prices in the marketplace for many inputs, particularly fuel, transportation services, and steel, have moderated over the last six months. Due to our long supply chain for imported fasteners and certain non-fastener products, however, it is likely to take several quarters before this is reflected in our cost of goods. The impact of product pricing on net sales in the fourth quarter of 2021 was 440 to 470 basis points.

From a product standpoint, we have three categories: fasteners, safety supplies, and other product lines, the latter of which includes eight smaller product categories, such as tools, janitorial supplies, and cutting tools. The DSR change when compared to the same period in the prior year and the percent of sales in the period were as follows:

	DSR Change Three-month Period				% of Sales Three-month Period
	2022		2021		2022		2021
Fasteners	9.1	%	24.2	%	33.0	%	33.5	%
Safety supplies	10.7	%	3.5	%	21.3	%	21.4	%
Other	12.1	%	12.8	%	45.7	%	45.1	%

Our end markets consist of manufacturing, non-residential construction, and other, the latter of which includes resellers, government/education, and transportation/warehousing. The DSR change when compared to the same period in the prior year and the percent of sales in the period were as follows:

	DSR Change Three-month Period				% of Sales Three-month Period
	2022		2021		2022		2021
Manufacturing	16.0	%	23.8	%	72.9	%	69.7	%
Non-residential construction	-0.6	%	14.8	%	9.8	%	11.0	%
Other	-0.9	%	-9.9	%	17.3	%	19.3	%

We report our customers in two categories: national accounts, which are customers with a multi-site contract, and non-national accounts, which include large regional customers, small local customers, and government customers. Sales to most of our national account customers grew in the fourth quarter of 2022 over the year earlier period, as our sales grew at 79 of our Top 100 national account customers. The DSR change when compared to the same period in the prior year and the percent of sales in the period were as follows:

	DSR Change Three-month Period				% of Sales Three-month Period
	2022		2021		2022		2021
National Accounts	15.0	%	19.9	%	58.9	%	57.8	%
Non-National Accounts	5.6	%	7.6	%	41.1	%	42.2	%

Our gross profit, as a percentage of net sales, declined to 45.3% in the fourth quarter of 2022 from 46.5% in the fourth quarter of 2021. The decline in our gross profit percentage was primarily related to three factors. First, the net impact from mix was dilutive. We experienced relatively strong growth from our Onsite customers, national account customers, and non-fastener products, each of which tend to have a lower gross margin percentage than our business as a whole. Second, we had lower product margins in certain of our other product categories. We believe slower demand and greater product availability in the marketplace due to supply chain normalization has put some margin pressure on products that tend to be sold less frequently. Third, we experienced unfavorable price/cost, reflecting stable pricing for our products and services, but slightly higher costs. These impacts were slightly offset by a favorable contribution from freight, where we continued to experience healthy revenue which allowed us to leverage relatively stable costs and narrowed our freight losses.

Our operating income, as a percentage of net sales, was unchanged at 19.6% in the fourth quarter of 2022 from 19.6% in the fourth quarter of 2021. This was due to improved operating expense leverage, which offset the decline in our gross profit percentage. Our operating and administrative expenses, as a percentage of net sales, fell to 25.7% in the fourth quarter of 2022 from 26.9% in the fourth quarter of 2021. This was primarily due to a decline, as a percentage of net sales, in employee-related and occupancy-related expenses.

Employee-related expenses, which represent 70% to 75% of total operating and administrative expenses, increased 6.0% in the fourth quarter of 2022 compared to the fourth quarter of 2021. We experienced an increase in employee base pay due to higher average FTE during the period and, to a lesser degree, higher average wages. Bonus and commission payments decreased slightly reflecting slower sales and profit growth versus the year-ago period. We also experienced lower healthcare expenses reflecting post-COVID normalization of the healthcare environment. This was partly offset by higher profit sharing costs. Occupancy-related expenses, which represent 15% to 20% of total operating and administrative expenses, increased 0.1% in the fourth quarter of 2022 compared to the fourth quarter of 2021. Facility costs were slightly higher, with higher utility expenses more than offsetting reduced rents related to the reduction in our branch locations versus the year-earlier period. We also saw an increase in materials and equipment involved in maintaining and upgrading our facilities. Combined, all other operating and administrative expenses, which represent 10% to 15% of total operating and administrative expenses, increased 11.9% in the fourth quarter of 2022 compared to the fourth quarter of 2021. The increase in other operating and administrative expenses relates primarily to higher spending on information technology related to mobility hardware rollouts and general inflation for IT services and higher product movement and fuel costs for our local truck fleet.

Our net interest expense was $4.8 in the fourth quarter of 2022, compared to $2.4 in the fourth quarter of 2021. This increase was due to higher average debt balances and higher average interest rates on those borrowings during the period.

We recorded income tax expense of $82.6 in the fourth quarter of 2022, or 25.2% of earnings before income taxes. Income tax expense was $67.3 in the fourth quarter of 2021, or 22.6% of earnings before income taxes. The increase in our tax rate in the fourth quarter of 2022 is due primarily to an increase in state income tax expense, an increase in employee expense that was non-deductible due to strong financial results, and the absence of certain favorable reserve adjustments that benefited the fourth quarter of 2021. We believe our ongoing tax rate, absent any discrete tax items or broader changes to tax law, will be approximately 24.5%.

Our net earnings during the fourth quarter of 2022 were $245.6, an increase of 6.2% compared to the fourth quarter of 2021. Our diluted net earnings per share were $0.43 during the fourth quarter of 2022, which increased from $0.40 during the fourth quarter of 2021.

Growth Driver Performance

We signed 62 new Onsite locations (defined as dedicated sales and service provided from within, or in close proximity to, the customer’s facility) in the fourth quarter of 2022, resulting in full-year signings of new Onsite locations of 356. We had 1,623 active sites on December 31, 2022, which represented an increase of 14.6% from December 31, 2021. Daily sales through our Onsite locations, excluding sales transferred from branches to new Onsites, grew at a high-teens rate in the fourth quarter of 2022 over the fourth quarter of 2021. This growth is due to contributions from the increase in the number of Onsites we operate and continued healthy business activity from our Onsite customers. Our goal for Onsite signings in 2023 is 375 to 400.

FMI Technology is comprised of our FASTStock^℠ (scanned stocking locations), FASTBin^® (infrared, RFID, and scaled bins), and FASTVend^® (vending devices) offering. FASTStock’s fulfillment processing technology is not embedded, is relatively less expensive and highly flexible in application, and delivered using our proprietary mobility technology. FASTBin and FASTVend incorporate highly efficient and powerful embedded data tracking and fulfillment processing technologies. Prior to 2021, we reported exclusively on the signings, installations, and sales of FASTVend. Beginning in the first quarter of 2021, we began disclosing certain statistics around our FMI offering. The first statistic is a weighted FMI^® measure which combines the signings and installations of FASTBin and FASTVend in a standardized machine equivalent unit (MEU) based on the expected output of each type of device. We do not include FASTStock in this measurement because scanned stocking locations can take many forms, such as bins, shelves, cabinets, pallets, etc., that cannot be converted into a standardized MEU. The second statistic is revenue through FMI Technology which combines the sales through FASTStock, FASTBin, and FASTVend. A portion of the growth in sales experienced by FMI, particularly FASTStock and FASTBin, reflects the migration of products from less efficient non-digital stocking locations to more efficient, digital stocking locations.

The table below summarizes the signings and installations of, and sales through, our FMI devices.

	Twelve-month Period							Three-month Period
		2022		2021		Change			2022		2021		Change
Weighted FASTBin/FASTVend signings (MEUs)		20,735		19,311		7.4	%		4,730		3,972		19.1	%
Signings per day		82		76					76		64
Weighted FASTBin/FASTVend installations (MEUs; end of period)									102,151		92,874		10.0	%

FASTStock sales	$	832.0		587.6		41.6	%	$	210.4		170.7		23.2	%
*% of sales*		*11.8*	%	*9.7*	%				*12.3*	%	*11.0*	%
FASTBin/FASTVend sales	$	1,755.3		1,353.7		29.7	%	$	453.0		372.6		21.6	%
% of sales		24.9	%	22.3	%				26.4	%	24.1	%
FMI sales	$	2,587.3		1,941.3		33.3	%	$	663.4		543.3		22.1	%
FMI daily sales	$	10.2		7.7		32.7	%	$	10.7		8.8		22.1	%
*% of sales*		*36.7*	%	*32.0*	%				*38.7*	%	*35.1*	%

Our goal for weighted FASTBin and FASTVend device signings in 2023 is 23,000 to 25,000 MEUs.

All metrics provided above exclude approximately 6,500 non-weighted vending devices that are part of a leased locker program.

Our eCommerce business includes sales made through an electronic data interface (EDI), or other types of technical integrations, and through our web verticals. Daily sales through eCommerce grew 48.2% in the fourth quarter of 2022 and represented 20.1% of our total revenues in the period.

Our digital products and services are comprised of sales through FMI (FASTStock, FASTBin, and FASTVend) plus that proportion of our eCommerce sales that do not represent billings of FMI services (collectively, our Digital Footprint). We believe the data that is created through our digital capabilities enhances product visibility, traceability, and control that reduces risk in operations and creates ordering and fulfillment efficiencies for both ourselves and our customers. As a result, we believe our opportunity to grow our business will be enhanced through the continued development and expansion of our digital capabilities.

Our Digital Footprint in the fourth quarter of 2022 represented 52.6% of our sales, an increase from 46.4% of sales in the fourth quarter of 2021.

Balance Sheet and Cash Flow

We produced operating cash flow of $301.9 in the fourth quarter of 2022, an increase of 93.0% from the fourth quarter of 2021, representing 122.9% of the period’s net earnings versus 67.7% in the fourth quarter of 2021. The improvement reflects working capital being a modest source of cash in the fourth quarter of 2022, which is historically typical, versus working capital being a significant use of cash in the fourth quarter of 2021 in response to significant supply chain disruption in the marketplace. In 2022, our operating cash flow was $941.0, an increase of 22.2% from 2021, representing 86.6% of the period’s net earnings versus 83.3% in 2021. While the conversion rates between the full years of 2022 and 2021 were comparable, we saw meaningful improvement in our conversion ratio in the second half of 2022 versus the first half of 2022.

The dollar and percentage change in accounts receivable, net, inventories, and accounts payable as of December 31, 2022 when compared to December 31, 2021 were as follows:

	December 31			Twelve-month Dollar Change		Twelve-month Percentage Change
		2022	2021		2022	2022
Accounts receivable, net	$	1,013.2	900.2	$	113.0	12.6	%
Inventories		1,708.0	1,523.6		184.4	12.1	%
Trade working capital	$	2,721.2	2,423.8	$	297.4	12.3	%

Accounts payable	$	255.0	233.1	$	21.9	9.4	%

Trade working capital, net	$	2,466.2	2,190.7	$	275.5	12.6	%

Net sales in last two months	$	1,091.9	1,000.1	$	91.7	9.2	%

Note – Amounts may not foot due to rounding difference.

The increase in our accounts receivable balance at the end of 2022 is primarily attributable to two factors. First, our receivables increased as a result of improved business activity and resulting growth in our customers’ sales. Second, we continue to experience a shift in our mix due to relatively stronger growth from national account customers, which tend to be larger and carry longer payment terms than our non-national account customers.

The increase in our inventory balance at the end of 2022 is primarily attributable to three factors. First, our inventory increased to support improved business activity by our customers. Second, in the first half of 2022 we aggressively imported product to deepen our inventory as a means of addressing supply disruptions. These disruptions have largely dissipated which will allow us to shorten our product ordering cycle, though this process will be gradual as we also sustain high internal fulfillment rates. Third, inflation was responsible for approximately one-third of the overall increase. The impact of inflation continues to moderate as inflationary pressures ease.

Our accounts payable balance increased due to higher product purchases to support the growth of our customers.

During the fourth quarter of 2022, our investment in property and equipment, net of proceeds from sales, was $41.5, which is an increase of 0.7% from the fourth quarter of 2021. Higher spending for FMI equipment was largely offset by lower spending for information technology.In 2022, our investment in property and equipment, net of proceeds from sales, was $162.4, which is an increase of 9.6% from 2021. This increase was primarily due to higher spending on FMI equipment. Property spending was up only slightly, though this reflected higher spending at our hubs for safety and automation upgrades largely offset by lower spending on a new building in downtown Winona, which was completed at the end of 2021. Our final investment in property and equipment, net of proceeds from sales, was below our anticipated range of $170.0 to $190.0 due to certain equipment and project delays related to hub projects. In 2023, we expect our investment in property and equipment, net of proceeds of sales, to be $210.0 to $230.0. This increase reflects primarily: (1) higher property-related spending on upgrades to and investments in automation of certain hubs, the beginning of construction of a hub in Utah, and investment in materials to facilitate our branch conversion projects; (2) an increase in spending on information technology; and (3) investments in fleet equipment to support our network of heavy trucks.

During the fourth quarter of 2022, we returned $270.1 to our shareholders in the form of dividends ($176.9) and purchases of our common stock ($93.2), compared to $161.1 in the fourth quarter of 2021, all in the form of dividends. In 2022, we returned $949.1 to our shareholders in the form of dividends ($711.3) and purchases of our common stock ($237.8), compared to $643.7 in 2021, all in the form of dividends.

Total debt on our balance sheet was $555.0 at the end of 2022, or 14.9% of total capital (the sum of stockholders’ equity and total debt). This compares to $390.0, or 11.4% of total capital, at the end of 2021.

Additional Information

The table below summarizes our absolute and FTE (based on 40 hours per week) employee headcount, our investments related to in-market locations (defined as the sum of the total number of branch locations and the total number of active Onsite locations), and weighted FMI devices at the end of the periods presented and the percentage change compared to the end of the prior periods.

Change Since:

Change Since:

Q4

2022

Q3

2022

Q3

2022

Q4

2021

Q4

2021

In-market locations^{– absolute employee headcount}

13,410

13,243

1.3

%

12,464

7.6

%

In-market locations – FTE employee headcount

12,017

11,897

1.0

%

11,337

6.0

%

Total absolute employee headcount

22,386

22,025

1.6

%

20,507

9.2

%

Total FTE employee headcount ⁽¹⁾

19,854

19,519

1.7

%

18,334

8.3

%

Number of branch locations

1,683

1,716

-1.9

%

1,793

-6.1

%

Number of active Onsite locations

1,623

1,567

3.6

%

1,416

14.6

%

Number of in-market locations

3,306

3,283

0.7

%

3,209

3.0

%

Weighted FMI devices (MEU installed count) ⁽²⁾

102,151

99,409

2.8

%

92,874

10.0

%

⁽¹⁾Due to a calculation error, organizational support personnel was overstated by 36 FTE in the fourth quarter of 2021, with total non-selling FTE and total FTE being overstated by the same amount. These figures have been corrected in this release. Adjusting for this error, total FTE in the first quarter, second quarter, and third quarter of 2022 would have each been up by an additional 0.2% for year-to-date growth.

⁽²⁾This number excludes approximately 6,500 non-weighted devices that are part of our locker lease program.

During the last twelve months, we increased our total FTE employee headcount by 1,520. This reflects an increase in our in-market and non-in-market selling FTE employee headcount of 1,063 to support growth in the marketplace and sales initiatives targeting customer acquisition. We had an increase in our distribution center FTE employee headcount of 231 to support increasing product throughput at our facilities and to expand our local inventory fulfillment terminals (LIFTs). We had an increase in our remaining FTE employee headcount of 226 that relates primarily to personnel investments in information technology, manufacturing, and operational support, such as purchasing and product development.

We opened one branch in the fourth quarter of 2022 and closed 34, net of conversions. We activated 76 Onsite locations in the fourth quarter of 2022 and closed 20, net of conversions. In 2022, we opened 12 branches and closed 122, net of conversions. In 2022, we activated 306 Onsite locations and closed 99, net of conversions. In any period, the number of closings tends to reflect normal churn in our business, whether due to redefining or exiting customer relationships, the shutting or relocation of customer facilities that host our locations, or a customer decision, as well as our ongoing review of underperforming locations. Our in-market network forms the foundation of our business strategy, and we will continue to open or close locations as is deemed necessary to sustain and improve our network, support our growth drivers, and manage our operating expenses.

CONFERENCE CALL TO DISCUSS QUARTERLY AND ANNUAL RESULTS

As we previously disclosed, we will host a conference call today to review the quarterly and annual results, as well as current operations. This conference call will be broadcast live over the Internet at 9:00 a.m., central time. To access the webcast, please go to the Fastenal Company Investor Relations Website at https://investor.fastenal.com/events.cfm.

ADDITIONAL MONTHLY AND QUARTERLY INFORMATION

We publish on the ‘Investor Relations’ page of our website at www.fastenal.com both our monthly consolidated net sales information and the presentation for our quarterly conference call (which includes information, supplemental to that contained in our earnings announcement, regarding results for the quarter). We expect to publish the consolidated net sales information for each month, other than the third month of a quarter, at 6:00 a.m., central time, on the fourth business day of the following month. We expect to publish the consolidated net sales information for the third month of each quarter and the conference call presentation for each quarter at 6:00 a.m., central time, on the date our earnings announcement for such quarter is publicly released.

FORWARD LOOKING STATEMENTS

Certain statements contained in this document do not relate strictly to historical or current facts. As such, they are considered ‘forward-looking statements’ that provide current expectations or forecasts of future events. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by the use of terminology such as anticipate, believe, should, estimate, expect, intend, may, will, plan, goal, project, hope, trend, target, opportunity, and similar words or expressions, or by references to typical outcomes. Any statement that is not a historical fact, including estimates, projections, future trends, and the outcome of events that have not yet occurred, is a forward-looking statement. Our forward-looking statements generally relate to our expectations and beliefs regarding the business environment in which we operate, our projections of future performance, our perceived marketplace opportunities, our strategies, goals, mission, and vision, and our expectations about future capital expenditures, future tax rates, future inventory levels, pricing, future Onsite and weighted FMI device signings, investment in property and equipment, the impact of inflation on our cost of goods or operating costs, and future operating results and business activity. You should understand that forward-looking statements involve a variety of risks and uncertainties, known and unknown (including risks related to inflation, supply chain constraints, labor shortages, and the COVID-19 pandemic), and may be affected by inaccurate assumptions. Consequently, no forward-looking statement can be guaranteed and actual results may vary materially. Factors that could cause our actual results to differ from those discussed in the forward-looking statements include, but are not limited to, those detailed in our most recent annual and quarterly reports. Each forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any such statement to reflect events or circumstances arising after such date. FAST-E

FASTENAL COMPANY AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Amounts in millions except share information)

December 31,

2022

December 31,

2021

Assets

(Unaudited)

Current assets:

Cash and cash equivalents

$

230.1

236.2

Trade accounts receivable, net of allowance for credit losses of $8.3 and $12.0, respectively

1,013.2

900.2

Inventories

1,708.0

1,523.6

Prepaid income taxes

8.1

8.5

Other current assets

165.4

188.1

Total current assets

3,124.8

2,856.6

Property and equipment, net

1,010.0

1,019.2

Operating lease right-of-use assets

243.0

242.3

Other assets

170.8

180.9

Total assets

$

4,548.6

4,299.0

Liabilities and Stockholders’ Equity

Current liabilities:

Current portion of debt

$

201.8

60.0

Accounts payable

255.0

233.1

Accrued expenses

241.1

298.3

Current portion of operating lease liabilities

91.9

90.8

Total current liabilities

789.8

682.2

Long-term debt

353.2

330.0

Operating lease liabilities

155.2

156.0

Deferred income taxes

83.7

88.6

Other long-term liabilities

3.5

—

Stockholders’ equity:

Preferred stock: $0.01 par value, 5,000,000 shares authorized, no shares issued or outstanding

—

—

Common stock: $0.01 par value, 800,000,000 shares authorized, 570,811,674 and 575,464,682 shares issued and outstanding, respectively

5.7

5.8

Additional paid-in capital

3.6

96.2

Retained earnings

3,218.7

2,970.9

Accumulated other comprehensive loss

(64.8

)

(30.7

)

Total stockholders’ equity

3,163.2

3,042.2

Total liabilities and stockholders’ equity

$

4,548.6

4,299.0

FASTENAL COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Earnings

(Amounts in millions except earnings per share)

Year Ended

December 31,

Three Months Ended

December 31,

2022

2021

2022

2021

(Unaudited)

(Unaudited)

(Unaudited)

Net sales

$

6,980.6

6,010.9

$

1,695.6

1,531.8

Cost of sales

3,764.8

3,233.7

927.2

818.9

Gross profit

3,215.8

2,777.2

768.4

712.9

Operating and administrative expenses

1,762.2

1,559.8

435.4

412.0

Operating income

1,453.6

1,217.4

333.0

300.9

Interest income

0.7

0.1

0.3

0.0

Interest expense

(14.3

)

(9.7

)

(5.1

)

(2.4

)

Earnings before income taxes

1,440.0

1,207.8

328.2

298.5

Income tax expense

353.1

282.8

82.6

67.3

Net earnings

$

1,086.9

925.0

$

245.6

231.2

Basic net earnings per share

$

1.89

1.61

$

0.43

0.40

Diluted net earnings per share

$

1.89

1.60

$

0.43

0.40

Basic weighted average shares outstanding

573.8

574.8

571.1

575.3

Diluted weighted average shares outstanding

575.6

577.1

572.8

577.7

FASTENAL COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Amounts in millions)

Year Ended

December 31,

Three Months Ended

December 31,

2022

2021

2022

2021

(Unaudited)

(Unaudited)

(Unaudited)

Cash flows from operating activities:

Net earnings

$

1,086.9

925.0

$

245.6

231.2

Adjustments to reconcile net earnings to net cash provided by operating activities:

Depreciation of property and equipment

165.9

159.9

42.1

40.9

Loss (gain) on sale of property and equipment

1.1

(1.1

)

(0.1

)

—

Bad debt expense

(1.8

)

2.5

(0.9

)

1.7

Deferred income taxes

(4.9

)

(13.7

)

(9.2

)

(16.0

)

Stock-based compensation

7.2

5.6

2.8

1.3

Amortization of intangible assets

10.7

10.8

2.6

2.7

Changes in operating assets and liabilities:

Trade accounts receivable

(119.8

)

(135.2

)

103.1

47.0

Inventories

(198.0

)

(189.5

)

(21.1

)

(123.0

)

Other current assets

22.7

(47.8

)

6.8

(25.5

)

Accounts payable

21.9

26.1

(22.2

)

(23.8

)

Accrued expenses

(57.2

)

26.2

(41.3

)

20.3

Income taxes

0.4

(1.8

)

(4.9

)

(1.8

)

Other

5.9

3.1

(1.4

)

1.4

Net cash provided by operating activities

941.0

770.1

301.9

156.4

Cash flows from investing activities:

Purchases of property and equipment

(173.8

)

(156.6

)

(42.8

)

(41.9

)

Proceeds from sale of property and equipment

11.4

8.4

1.3

0.7

Other

(0.6

)

(0.3

)

0.1

(0.3

)

Net cash used in investing activities

(163.0

)

(148.5

)

(41.4

)

(41.5

)

Cash flows from financing activities:

Proceeds from debt obligations

1,795.0

525.0

405.0

225.0

Payments against debt obligations

(1,630.0

)

(540.0

)

(405.0

)

(200.0

)

Proceeds from exercise of stock options

9.2

31.6

1.4

7.2

Purchases of common stock

(237.8

)

—

(93.2

)

—

Cash dividends paid

(711.3

)

(643.7

)

(176.9

)

(161.1

)

Net cash used in financing activities

(774.9

)

(627.1

)

(268.7

)

(128.9

)

Effect of exchange rate changes on cash and cash equivalents

(9.2

)

(4.0

)

6.8

(0.3

)

Net decrease in cash and cash equivalents

(6.1

)

(9.5

)

(1.4

)

(14.3

)

Cash and cash equivalents at beginning of period

236.2

245.7

231.5

250.5

Cash and cash equivalents at end of period

$

230.1

236.2

$

230.1

236.2

Supplemental information:

Cash paid for interest

$

13.3

9.9

$

4.1

2.3

Net cash paid for income taxes

$

354.1

294.0

$

96.8

83.3

View source version on businesswire.com: https://www.businesswire.com/news/home/20230118006006/en/

Taylor Ranta Oborski

Financial Reporting & Regulatory Compliance Manager

507.313.7959

KEYWORDS: Minnesota United States North America

INDUSTRY KEYWORDS: Commercial Building & Real Estate Construction & Property Specialty Supply Chain Management Logistics/Supply Chain Management Transport Retail Residential Building & Real Estate

MEDIA:

Logo

Posted on January 19, 2023 6:48 am
Universal Stainless Reports Preliminary Fourth Quarter 2022 Results

– Fourth Quarter Conference Call to be Webcast on January 25th –

BRIDGEVILLE, Pa., Jan. 19, 2023 (GLOBE NEWSWIRE) — Universal Stainless & Alloy Products, Inc. (Nasdaq: USAP) today reported that, based on preliminary results, it expects to report net sales for the fourth quarter of 2022 of $56.2 million, an increase of 22% from the third quarter of 2022, and 30% higher than the fourth quarter of 2021. Sales of premium alloys in the fourth quarter of 2022 are expected to reach a record $13.5 million, or 24% of sales, driven mainly by a 27% sequential increase in sales to the aerospace market.

Gross margin in the fourth quarter of 2022 is expected to approximate $2.4 million, or 4.3% of sales, versus $3.0 million, or 6.4% of sales, in the 2022 third quarter. The sequential decline was mainly due to two factors: negative misalignment between surcharges and material costs of approximately $2.4 million and unplanned outages at key facilities that negatively impacted gross profit by approximately $0.7 million.

As a result, the Company expects to report a net loss for the fourth quarter of 2022 of approximately $3.7 million, or $0.41 per diluted share, compared with a net loss of $1.3 million, or $0.14 per diluted share, in the third quarter of 2022.

Dennis Oates, Chairman, President and CEO, commented: “We achieved noteworthy top-line growth in the fourth quarter including in our strategic growth categories of premium alloys and aerospace. This made our bottom line loss especially disappointing. The main factor was the negative impact of surcharge misalignment. Surcharges were at the lowest level of the year in the fourth quarter due to a drop in commodity prices, at a time that we were shipping products with higher materials cost produced earlier in the year. The outages were also impactful as they occurred at key work centers, caused by equipment breakdowns and freezing weather conditions in December. Although improving, inflation, supply chain and labor issues are lingering challenges.

“With our year-end backlog reaching a record $287.9 million, including sequential price per-pound increases each quarter, we are optimistic about our sales and margin growth prospects for 2023 and beyond.”

Fourth Quarter Conference Call and Webcast

The Company will report financial results for the fourth quarter of 2022 on Wednesday, January 25, 2023. In conjunction with the earnings release, the Company will host a conference call at 10:00 a.m. (Eastern) on January 25^th. The call will be webcast simultaneously for all interested parties over the Internet.

Call Dial-In Procedures

:

Please Click Here to register for the conference call and obtain your dial-in number and personal PIN number.

The simultaneous webcast will be available on the Company’s website at www.univstainless.com, and thereafter archived on the website through the end of the first quarter of 2023. Please allow 5 minutes prior to the live webcast to visit the site to download and install any necessary audio software.

About Universal Stainless & Alloy Products, Inc.

Universal Stainless & Alloy Products, Inc., established in 1994 and headquartered in Bridgeville, PA, manufactures and markets semi-finished and finished specialty steels, including stainless steel, nickel alloys, tool steel and certain other alloyed steels. The Company’s products are used in a variety of industries, including aerospace, power generation, oil and gas, and heavy equipment manufacturing. More information is available at www.univstainless.com.

Forward-Looking Information Safe Harbor

Except for historical information contained herein, the statements in this release are forward-looking statements that are made pursuant to the “safe harbor” provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company’s actual results in future periods to differ materially from forecasted results. Those risks include, among others, the Company’s ability to maintain its relationships with its significant customers and market segments; the Company’s response to competitive factors in its industry that may adversely affect the market for finished products manufactured by the Company or its customers; the Company’s ability to compete successfully with domestic and foreign producers of specialty steel products and products fashioned from alternative materials; changes in overall demand for the Company’s products and the prices at which the Company is able to sell its products in the aerospace industry, from which a substantial amount of its sales is derived; the Company’s ability to develop, commercialize, market and sell new applications and new products; the receipt, pricing and timing of future customer orders; the impact of changes in the Company’s product mix on the Company’s profitability; the Company’s ability to maintain the availability of raw materials and operating supplies with acceptable pricing; the availability and pricing of electricity, natural gas and other sources of energy that the Company needs for the manufacturing of its products; risks related to property, plant and equipment, including the Company’s reliance on the continuing operation of critical manufacturing equipment; the Company’s success in timely concluding collective bargaining agreements and avoiding strikes or work stoppages; the Company’s ability to attract and retain key personnel; the Company’s ongoing requirement for continued compliance with laws and regulations, including applicable safety and environmental regulations; the ultimate outcome of the Company’s current and future litigation matters; the Company’s ability to meet its debt service requirements and to comply with applicable financial covenants; risks associated with conducting business with suppliers and customers in foreign countries; public health issues, including COVID-19 and its uncertain impact on its facilities and operations and our customers and suppliers and the effectiveness of the Company’s actions taken in response to these risks; risks related to acquisitions that the Company may make; the Company’s ability to protect its information technology infrastructure against service interruptions, data corruption, cyber-based attacks or network security breaches; the impact on the Company’s effective tax rates from changes in tax rules, regulations and interpretations in the United States and other countries where it does business; and the impact of various economic, credit and market risk uncertainties. Many of these factors are not within the Company’s control and involve known and unknown risks and uncertainties that may cause the Company’s actual results in future periods to be materially different from any future performance suggested herein. Any unfavorable change in the foregoing or other factors could have a material adverse effect on the Company’s business, financial condition and results of operations. Further, the Company operates in an industry sector where securities values may be volatile and may be influenced by economic and other factors beyond the Company’s control. Certain of these risks and other risks are described in the Company’s filings with the SEC, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, copies of which are available from the SEC or may be obtained upon request from the Company.

CONTACTS: Dennis M. Oates Steven V. DiTommaso June Filingeri

Chairman,
President and CEO Vice President and
Chief Financial Officer President
Comm-Partners LLC

(412) 257-7609 (412) 257-7661 (203) 972-0186

Posted on January 19, 2023 6:48 am
BankUnited, Inc. Reports 2022 Results

BankUnited, Inc. Reports 2022 Results

MIAMI LAKES, Fla.–(BUSINESS WIRE)–
BankUnited, Inc. (the “Company”) (NYSE: BKU) today announced financial results for the quarter and year ended December 31, 2022.

“We finished 2022 strong, with good growth, margin expansion and the launch of Atlanta and the Dallas branch. We’re optimistic going into 2023,” said Rajinder Singh, Chairman, President and Chief Executive Officer.

For the quarter ended December 31, 2022, the Company reported net income of $64.2 million, or $0.82 per diluted share, compared to $87.9 million, or $1.12 per diluted share for the immediately preceding quarter ended September 30, 2022 and $125.3 million, or $1.41 per diluted share, for the quarter ended December 31, 2021. For the year ended December 31, 2022, the Company reported net income of $285.0 million, or $3.54 per diluted share, compared to $415.0 million, or $4.52 per diluted share, for the year ended December 31, 2021.

Quarterly Highlights

BankUnited was ranked #1 in comprehensive innovation, #2 in bank reputation among customers and #9 in bank reputation among non-customers in an annual survey by the American Banker and RepTrak, published in November 2022. The survey encompassed 41 large, regional and nontraditional banks.

Pre-tax, pre-provision net revenue (“PPNR”) was $121.4 million for the quarter ended December 31, 2022, compared to $120.8 million for the immediately preceding quarter ended September 30, 2022 and $63.8 million for the quarter ended December 31, 2021. PPNR for the quarter ended December 31, 2021 was impacted by certain significant notable items, further discussed below in the section titled “Non-interest income and Non-interest expense.”

Loans grew by $619 million for the quarter ended December 31, 2022. The core C&I and commercial real estate portfolio segments grew by a total of $722 million. For the year ended December 31, 2022, excluding the decline in PPP loans, total loans grew by 6% or $1.4 billion.

Total deposits grew by $160 million during the quarter ended December 31, 2022. Not unexpectedly in the current interest rate environment, non-interest bearing demand deposits declined by $756 million to 29% of total deposits, while interest bearing deposits grew by $916 million.

The net interest margin, calculated on a tax-equivalent basis, expanded to 2.81% for the quarter ended December 31, 2022, from 2.76% for the immediately preceding quarter and 2.44% for the quarter ended December 31, 2021. Net interest income increased by $7.2 million, compared to the immediately preceding quarter ended September 30, 2022 and by $37.1 million compared to the quarter ended December 31, 2021. Net interest income for the year ended December 31, 2022 grew by 15% compared to the prior year, while the net interest margin expanded by 30 basis points year-over-year.

In response to the rising interest rate environment and tightening liquidity, the average cost of total deposits rose to 1.42% for the quarter ended December 31, 2022, from 0.78% for the immediately preceding quarter ended September 30, 2022 and 0.19% for the quarter ended December 31, 2021. The yield on average interest earning assets increased to 4.60% for the quarter ended December 31, 2022, from 3.80% for the immediately preceding quarter and 2.81% for the quarter ended December 31, 2021.

For the quarter ended December 31, 2022, the Company recorded a provision for credit losses of $39.6 million compared to provisions of $3.7 million and $0.2 million for the quarters ended September 30, 2022 and December 31, 2021, respectively. Despite the decline in non-performing loans, we built reserves during the quarter in light of a worsening baseline economic forecast and a heightened level of uncertainty regarding the trajectory of the economy. The provision for credit losses for the quarter ended December 31, 2022 was also impacted by loan growth and an increase in certain specific reserves. The ratio of the ACL to total loans increased to 0.59%, from 0.54% at September 30, 2022.

During the quarter ended December 31, 2022, the Company repurchased approximately 1.9 million shares of its common stock for an aggregate purchase price of $64.7 million, at a weighted average price of $33.92 per share.

Loans

A comparison of loan portfolio composition at the dates indicated follows (dollars in thousands):

December 31, 2022

September 30, 2022

December 31, 2021

Residential and other consumer loans

$

8,900,714

35.7

%

$

8,853,884

36.4

%

$

8,368,380

35.2

%

Non-owner occupied commercial real estate

5,405,597

21.7

%

5,331,232

22.1

%

5,536,348

23.3

%

Construction and land

294,360

1.2

%

246,202

1.0

%

165,390

0.7

%

Owner occupied commercial real estate

1,890,813

7.6

%

1,919,074

7.9

%

1,944,658

8.2

%

Commercial and industrial

6,414,351

25.9

%

5,786,907

23.9

%

4,790,275

20.2

%

PPP

3,370

—

%

10,191

—

%

248,505

1.0

%

Pinnacle

912,122

3.7

%

932,187

3.8

%

919,641

3.9

%

Bridge – franchise finance

253,774

1.0

%

254,137

1.0

%

342,124

1.4

%

Bridge – equipment finance

286,147

1.1

%

310,035

1.3

%

357,599

1.5

%

Mortgage warehouse lending (“MWL”)

524,740

2.1

%

622,883

2.6

%

1,092,133

4.6

%

$

24,885,988

100.0

%

$

24,266,732

100.0

%

$

23,765,053

100.0

%

Total loans grew by $619 million for the quarter ended December 31, 2022. In the aggregate, the core C&I and commercial real estate portfolio segments grew by $722 million. The commercial and industrial segment, including owner-occupied commercial real estate, grew by $599 million for the quarter, while commercial real estate loans grew by $123 million. As expected, the remaining commercial segments declined during the quarter while the residential portfolio grew modestly.

Asset Quality and the Allowance for Credit Losses (“ACL”)

Non-performing loans totaled $105.0 million or 0.42% of total loans at December 31, 2022, down from $156.4 million or 0.64% of total loans at September 30, 2022 and $205.9 million or 0.87% of total loans at December 31, 2021. Non-performing loans included $40.3 million, $41.8 million and $46.1 million of the guaranteed portion of SBA loans on non-accrual status, representing 0.16%, 0.17% and 0.19% of total loans at December 31, 2022, September 30, 2022 and December 31, 2021, respectively.

The following table presents criticized and classified commercial loans at the dates indicated (in thousands):

December 31,

2022

September 30,

2022

December 31,

2021

Special mention

$

51,433

$

26,939

$

148,593

Substandard – accruing

605,965

662,716

1,136,378

Substandard – non-accruing

75,125

104,994

129,579

Doubtful

7,990

32,093

47,754

Total

$

740,513

$

826,742

$

1,462,304

The following table presents the ACL and related ACL coverage ratios at the dates indicated and net charge-off rates for the periods ended December 31, 2022, September 30, 2022, and December 31, 2021 (dollars in thousands):

ACL

ACL to Total

Loans

ACL to Non-

Performing Loans

Net Charge-offs to

Average Loans ⁽¹⁾

December 31, 2021

$

126,457

0.53

%

61.41

%

0.29

%

September 30, 2022

$

130,671

0.54

%

83.54

%

0.16

%

December 31, 2022

$

147,946

0.59

%

140.88

%

0.22

%

____________

(1)

Annualized for the nine months ended September 30, 2022.

The ACL at December 31, 2022 represents management’s estimate of lifetime expected credit losses given our assessment of historical data, current conditions and a reasonable and supportable economic forecast as of the balance sheet date. For the quarter ended December 31, 2022, the Company recorded a provision for credit losses of $39.6 million, including $40.4 million related to funded loans. The most significant factor impacting the provision for credit losses for the quarter ended December 31, 2022 was the economic forecast and uncertainty about the trajectory of the economy, which impacted both the quantitative and qualitative portions of the ACL. New loan production and increases in certain specific reserves also impacted the provision for the quarter.

For the year ended December 31, 2022 the provision for credit losses totaled $75.2 million, compared to a recovery of the provision of $(67.1) million for the year ended December 31, 2021. The provision for 2022 reflected consideration of emerging economic uncertainty and increasing probability of a recession, while the recovery for 2021 reflected the release of reserves built at the time of onset of the COVID-19 pandemic.

The following table summarizes the activity in the ACL for the periods indicated (in thousands):

Three Months Ended December 31,

Years Ended December 31,

2022

2021

2022

2021

Beginning balance

$

130,671

$

159,615

$

126,457

$

257,323

Provision (recovery)

40,408

1,067

73,814

(64,456

)

Net charge-offs

(23,133

)

(34,225

)

(52,325

)

(66,410

)

Ending balance

$

147,946

$

126,457

$

147,946

$

126,457

Net Interest Income

Net interest income for the quarter ended December 31, 2022 was $243.1 million, compared to $235.8 million for the immediately preceding quarter ended September 30, 2022 and $206.0 million for the quarter ended December 31, 2021. Interest income increased by $75.5 million for the quarter ended December 31, 2022, compared to the immediately preceding quarter while interest expense increased by $68.2 million.

The Company’s net interest margin, calculated on a tax-equivalent basis, increased by 0.05% to 2.81% for the quarter ended December 31, 2022, from 2.76% for the immediately preceding quarter ended September 30, 2022. Factors impacting the net interest margin for the quarter ended December 31, 2022 included:

The tax-equivalent yield on investment securities increased to 4.33% for the quarter ended December 31, 2022, from 3.12% for the quarter ended September 30, 2022. This increase resulted from the reset of coupon rates on variable rate securities and to a lesser extent, purchases of higher yielding securities.

The tax-equivalent yield on loans increased to 4.72% for the quarter ended December 31, 2022, from 4.11% for the quarter ended September 30, 2022. The resetting of variable rate loans to higher coupon rates and origination of new loans at higher rates contributed to the increase.

The average rate paid on interest bearing deposits increased to 2.06% for the quarter ended December 31, 2022, from 1.14% for the quarter ended September 30, 2022, in response to the rising interest rate environment and tightening liquidity conditions. Time deposits grew as a percentage of interest bearing deposits as we deployed a strategy to extend the term of interest bearing deposits.

The average rate paid on FHLB advances increased to 3.44% for the quarter ended December 31, 2022, from 2.25% for the quarter ended September 30, 2022, primarily in response to the rising interest rate environment.

Non-interest income and Non-interest expense

Non-interest income totaled $26.8 million for the quarter ended December 31, 2022, compared to $23.1 million for the quarter ended September 30, 2022 and $45.6 million for the quarter ended December 31, 2021. During the quarter ended December 31, 2021, the Company sold a portfolio of single-family residential loans for a gain of $18.2 million.

Non-interest income totaled $77.6 million for the year ended December 31, 2022, compared to $134.2 million for the year ended December 31, 2021. The year-over-year decline is primarily attributable to (i) the gain on sale of residential loans in the fourth quarter of 2021 discussed above, (ii) a $19.7 million decline in the fair value of certain preferred stock investments included in net loss on investment securities for the year ended December 31, 2022, and (iii) a decline in “other” non-interest income related primarily to lower BOLI revenue.

Non-interest expense totaled $148.5 million for the quarter ended December 31, 2022, compared to $138.1 million for the immediately preceding quarter ended September 30, 2022 and $187.9 million for the quarter ended December 31, 2021. Non-interest expense totaled $540.3 million and $547.6 million for the years ended December 31, 2022 and 2021, respectively. Non-interest expense for the quarter and year ended December 31, 2021 included a loss of $44.8 million on discontinuance of cash flow hedges. Quarter-over-quarter and year-over-year increases in employee compensation and benefits and in technology expense reflected labor market dynamics and continued investment in people and technology to support future growth.

Provision (benefit) for income taxes

The effective income tax rate was 21.5% and 24.0% for the quarter and year ended December 31, 2022, compared to (97.2)% and 7.7% for the quarter and year ended December 31, 2021. The effective income tax rate for both the quarter and year ended December 31, 2021 was positively impacted by $69.1 million in discrete tax benefits recognized in the fourth quarter of 2021.

Earnings Conference Call and Presentation

A conference call to discuss quarterly results will be held at 9:00 a.m. ET on Thursday, January 19, 2023 with Chairman, President and Chief Executive Officer, Rajinder P. Singh, Chief Financial Officer, Leslie N. Lunak and Chief Operating Officer, Thomas M. Cornish.

The earnings release and slides with supplemental information relating to the release will be available on the Investor Relations page under About Us on www.bankunited.com prior to the call. Due to recent demand for conference call services, participants are encouraged to listen to the call via a live Internet webcast at https://ir.bankunited.com. To participate by telephone, participants will receive dial-in information and a unique PIN number upon completion of registration at https://register.vevent.com/register/BI9a423dcb6b32467695ab75bc2d26717e. For those unable to join the live event, an archived webcast will be available in the Investor Relations page at https://ir.bankunited.com approximately two hours following the live webcast.

About BankUnited, Inc.

BankUnited, Inc., with total assets of $37.0 billion at December 31, 2022, is the bank holding company of BankUnited, N.A., a national bank headquartered in Miami Lakes, Florida with 54 banking centers in 12 Florida counties, 4 banking centers in the New York metropolitan area, and 1 banking center located in Dallas, Texas.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the Company’s current views with respect to, among other things, future events and financial performance.

The Company generally identifies forward-looking statements by terminology such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “could,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” “forecasts” or the negative version of those words or other comparable words. Any forward-looking statements contained in this press release are based on the historical performance of the Company and its subsidiaries or on the Company’s current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by the Company that the future plans, estimates or expectations contemplated by the Company will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions, including (without limitations) those relating to the Company’s operations, financial results, financial condition, business prospects, growth strategy and liquidity, including as impacted by external circumstances outside the Company’s direct control. If one or more of these or other risks or uncertainties materialize, or if the Company’s underlying assumptions prove to be incorrect, the Company’s actual results may vary materially from those indicated in these statements. These factors should not be construed as exhaustive. The Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements. Information on these factors can be found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and any subsequent Quarterly Report on Form 10-Q or Current Report on Form 8-K, which are available at the SEC’s website (www.sec.gov).

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS – UNAUDITED

(In thousands, except share and per share data)

December 31,

2022

December 31,

2021

ASSETS

Cash and due from banks:

Non-interest bearing

$

16,068

$

19,143

Interest bearing

556,579

295,714

Cash and cash equivalents

572,647

314,857

Investment securities (including securities recorded at fair value of $9,745,327 and $10,054,198)

9,755,327

10,064,198

Non-marketable equity securities

294,172

135,859

Loans

24,885,988

23,765,053

Allowance for credit losses

(147,946

)

(126,457

)

Loans, net

24,738,042

23,638,596

Bank owned life insurance

308,212

309,477

Operating lease equipment, net

539,799

640,726

Goodwill

77,637

77,637

Other assets

740,876

634,046

Total assets

$

37,026,712

$

35,815,396

LIABILITIES AND STOCKHOLDERS’ EQUITY

Liabilities:

Demand deposits:

Non-interest bearing

$

8,037,848

$

8,975,621

Interest bearing

2,142,067

3,709,493

Savings and money market

13,061,341

13,368,745

Time

4,268,078

3,384,243

Total deposits

27,509,334

29,438,102

Federal funds purchased

190,000

199,000

FHLB advances

5,420,000

1,905,000

Notes and other borrowings

720,923

721,416

Other liabilities

750,474

514,117

Total liabilities

34,590,731

32,777,635

Commitments and contingencies

Stockholders’ equity:

Common stock, par value $0.01 per share, 400,000,000 shares authorized; 75,674,587 and 85,647,986 shares issued and outstanding

757

856

Paid-in capital

321,729

707,503

Retained earnings

2,551,400

2,345,342

Accumulated other comprehensive loss

(437,905

)

(15,940

)

Total stockholders’ equity

2,435,981

3,037,761

Total liabilities and stockholders’ equity

$

37,026,712

$

35,815,396

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED

(In thousands, except per share data)

Three Months Ended

Years Ended

December 31,

September 30,

December 31,

December 31,

December 31,

2022

2022

2021

2022

2021

Interest income:

Loans

$

288,973

$

244,884

$

198,275

$

934,642

$

800,819

Investment securities

105,172

77,109

38,201

280,100

152,619

Other

7,345

4,031

1,397

15,709

6,010

Total interest income

401,490

326,024

237,873

1,230,451

959,448

Interest expense:

Deposits

94,403

53,206

13,631

179,972

67,596

Borrowings

64,021

36,982

18,227

137,519

96,164

Total interest expense

158,424

90,188

31,858

317,491

163,760

Net interest income before provision for credit losses

243,066

235,836

206,015

912,960

795,688

Provision for (recovery of) credit losses

39,608

3,720

246

75,154

(67,119

)

Net interest income after provision for credit losses

203,458

232,116

205,769

837,806

862,807

Non-interest income:

Deposit service charges and fees

5,482

6,064

5,815

23,402

21,685

Gain (loss) on sale of loans, net

(335

)

(613

)

19,003

(2,570

)

24,394

Gain (loss) on investment securities, net

320

135

590

(15,805

)

6,446

Lease financing

14,153

13,180

14,041

54,111

53,263

Other non-interest income

7,193

4,306

6,173

18,498

28,365

Total non-interest income

26,813

23,072

45,622

77,636

134,153

Non-interest expense:

Employee compensation and benefits

69,902

66,097

70,561

265,548

243,532

Occupancy and equipment

10,770

11,719

12,817

45,400

47,944

Deposit insurance expense

6,205

4,398

3,471

17,999

18,695

Professional fees

3,028

3,184

8,023

11,730

14,386

Technology

22,388

19,813

18,221

77,103

67,500

Discontinuance of cash flow hedges

—

—

44,833

—

44,833

Depreciation and impairment of operating lease equipment

12,547

12,646

15,769

50,388

53,764

Other non-interest expense

23,639

20,248

14,165

72,142

56,921

Total non-interest expense

148,479

138,105

187,860

540,310

547,575

Income before income taxes

81,792

117,083

63,531

375,132

449,385

Provision (benefit) for income taxes

17,585

29,233

(61,724

)

90,161

34,401

Net income

$

64,207

$

87,850

$

125,255

$

284,971

$

414,984

Earnings per common share, basic

$

0.83

$

1.13

$

1.42

$

3.55

$

4.52

Earnings per common share, diluted

$

0.82

$

1.12

$

1.41

$

3.54

$

4.52

BANKUNITED, INC. AND SUBSIDIARIES

AVERAGE BALANCES AND YIELDS

(Dollars in thousands)

Three Months Ended

December 31,

2022

Three Months Ended

September 30,

2022

Three Months Ended

December 31,

2021

Average

Balance

Interest ⁽¹⁾

Yield/

Rate

⁽¹⁾⁽²⁾

Average

Balance

Interest

⁽¹⁾

Yield/

Rate

⁽¹⁾⁽²⁾

Average

Balance

Interest ⁽¹⁾

Yield/

Rate

⁽¹⁾⁽²⁾

Assets:

Interest earning assets:

Loans

$

24,624,062

$

292,272

4.72

%

$

24,053,742

$

248,168

4.11

%

$

22,919,535

$

201,345

3.50

%

Investment securities ⁽³⁾

9,788,969

106,034

4.33

%

9,981,486

77,840

3.12

%

10,113,026

38,889

1.54

%

Other interest earning assets

710,315

7,345

4.10

%

596,879

4,031

2.68

%

1,184,056

1,397

0.47

%

Total interest earning assets

35,123,346

405,651

4.60

%

34,632,107

330,039

3.80

%

34,216,617

241,631

2.81

%

Allowance for credit losses

(137,300

)

(133,828

)

(149,319

)

Non-interest earning assets

1,837,156

1,703,371

1,767,850

Total assets

$

36,823,202

$

36,201,650

$

35,835,148

Liabilities and Stockholders’ Equity:

Interest bearing liabilities:

Interest bearing demand deposits

$

2,183,854

$

6,704

1.22

%

$

2,306,906

$

4,104

0.71

%

$

3,058,355

$

1,481

0.19

%

Savings and money market deposits

12,054,892

68,001

2.24

%

13,001,566

39,838

1.22

%

13,460,084

9,619

0.28

%

Time deposits

3,960,111

19,698

1.97

%

3,255,869

9,264

1.13

%

3,399,302

2,531

0.30

%

Total interest bearing deposits

18,198,857

94,403

2.06

%

18,564,341

53,206

1.14

%

19,917,741

13,631

0.27

%

Federal funds purchased

175,637

1,677

3.74

%

153,905

833

2.12

%

56,793

13

0.09

%

FHLB advances

6,125,435

53,084

3.44

%

4,739,457

26,890

2.25

%

1,909,450

8,957

1.86

%

Notes and other borrowings

721,044

9,260

5.14

%

721,164

9,259

5.14

%

721,525

9,257

5.13

%

Total interest bearing liabilities

25,220,973

158,424

2.49

%

24,178,867

90,188

1.48

%

22,605,509

31,858

0.56

%

Non-interest bearing demand deposits

8,237,885

8,749,794

9,330,805

Other non-interest bearing liabilities

879,207

697,440

785,254

Total liabilities

34,338,065

33,626,101

32,721,568

Stockholders’ equity

2,485,137

2,575,549

3,113,580

Total liabilities and stockholders’ equity

$

36,823,202

$

36,201,650

$

35,835,148

Net interest income

$

247,227

$

239,851

$

209,773

Interest rate spread

2.11

%

2.32

%

2.25

%

Net interest margin

2.81

%

2.76

%

2.44

%

_______________

(1)

On a tax-equivalent basis where applicable

(2)

Annualized

(3)

At fair value except for securities held to maturity

BANKUNITED, INC. AND SUBSIDIARIES

AVERAGE BALANCES AND YIELDS

(Dollars in thousands)

Years Ended December 31,

2022

2021

Average

Balance

Interest ⁽¹⁾

Yield/

Rate ⁽¹⁾

Average

Balance

Interest ⁽¹⁾

Yield/

Rate ⁽¹⁾

Assets:

Interest earning assets:

Loans

$

23,937,857

$

947,386

3.96

%

$

23,083,973

$

814,101

3.53

%

Investment securities ⁽²⁾

10,081,701

283,081

2.81

%

9,873,178

155,353

1.57

%

Other interest earning assets

675,068

15,709

2.33

%

1,093,869

6,010

0.55

%

Total interest earning assets

34,694,626

1,246,176

3.59

%

34,051,020

975,464

2.86

%

Allowance for credit losses

(132,033

)

(197,212

)

Non-interest earning assets

1,721,570

1,770,685

Total assets

$

36,284,163

$

35,624,493

Liabilities and Stockholders’ Equity:

Interest bearing liabilities:

Interest bearing demand deposits

$

2,538,906

13,919

0.55

%

$

3,027,649

8,550

0.28

%

Savings and money market deposits

12,874,240

130,705

1.02

%

13,339,651

43,082

0.32

%

Time deposits

3,338,671

35,348

1.06

%

3,490,082

15,964

0.46

%

Total interest bearing deposits

18,751,817

179,972

0.96

%

19,857,382

67,596

0.34

%

Federal funds purchased

157,979

2,723

1.72

%

33,945

30

0.09

%

FHLB advances

4,383,507

97,763

2.23

%

2,622,723

59,116

2.25

%

Notes and other borrowings

721,223

37,033

5.13

%

721,803

37,018

5.13

%

Total interest bearing liabilities

24,014,526

317,491

1.32

%

23,235,853

163,760

0.70

%

Non-interest bearing demand deposits

8,861,111

8,480,964

Other non-interest bearing liabilities

708,473

784,031

Total liabilities

33,584,110

32,500,848

Stockholders’ equity

2,700,053

3,123,645

Total liabilities and stockholders’ equity

$

36,284,163

$

35,624,493

Net interest income

$

928,685

$

811,704

Interest rate spread

2.27

%

2.16

%

Net interest margin

2.68

%

2.38

%

_______________

(1)

On a tax-equivalent basis where applicable

(2)

At fair value except for securities held to maturity

BANKUNITED, INC. AND SUBSIDIARIES

EARNINGS PER COMMON SHARE

(In thousands except share and per share amounts)

Three Months Ended

December 31,

Years Ended

December 31,

2022

2021

2022

2021

Basic earnings per common share:

Numerator:

Net income

$

64,207

$

125,255

$

284,971

$

414,984

Distributed and undistributed earnings allocated to participating securities

(1,519

)

(2,059

)

(5,075

)

(5,991

)

Income allocated to common stockholders for basic earnings per common share

$

62,688

$

123,196

$

279,896

$

408,993

Denominator:

Weighted average common shares outstanding

77,043,587

88,123,835

80,032,356

91,612,243

Less average unvested stock awards

(1,207,275

)

(1,193,180

)

(1,224,568

)

(1,212,055

)

Weighted average shares for basic earnings per common share

75,836,312

86,930,655

78,807,788

90,400,188

Basic earnings per common share

$

0.83

$

1.42

$

3.55

$

4.52

Diluted earnings per common share:

Numerator:

Income allocated to common stockholders for basic earnings per common share

$

62,688

$

123,196

$

279,896

$

408,993

Adjustment for earnings reallocated from participating securities

(184

)

(234

)

(626

)

(585

)

Income used in calculating diluted earnings per common share

$

62,504

$

122,962

$

279,270

$

408,408

Denominator:

Weighted average shares for basic earnings per common share

75,836,312

86,930,655

78,807,788

90,400,188

Dilutive effect of certain share-based awards

127

—

94

134

Weighted average shares for diluted earnings per common share

75,836,439

86,930,655

78,807,882

90,400,322

Diluted earnings per common share

$

0.82

$

1.41

$

3.54

$

4.52

BANKUNITED, INC. AND SUBSIDIARIES

SELECTED RATIOS

Three Months Ended

December 31,

Years Ended

December 31,

2022

2021

2022

2021

Financial ratios⁽⁴⁾

Return on average assets

0.69

%

1.39

%

0.79

%

1.16

%

Return on average stockholders’ equity

10.3

%

16.0

%

10.6

%

13.3

%

Net interest margin⁽³⁾

2.81

%

2.44

%

2.68

%

2.38

%

December 31, 2022

December 31, 2021

Asset quality ratios

Non-performing loans to total loans⁽¹⁾⁽⁵⁾

0.42

%

0.87

%

Non-performing assets to total assets ⁽²⁾⁽⁵⁾

0.29

%

0.58

%

Allowance for credit losses to total loans

0.59

%

0.53

%

Allowance for credit losses to non-performing loans⁽¹⁾⁽⁵⁾

140.88

%

61.41

%

Net charge-offs to average loans

0.22

%

0.29

%

_______________

(1)

We define non-performing loans to include non-accrual loans and loans other than purchased credit deteriorated and government insured residential loans that are past due 90 days or more and still accruing. Contractually delinquent purchased credit deteriorated and government insured residential loans on which interest continues to be accrued are excluded from non-performing loans.

(2)

Non-performing assets include non-performing loans, OREO and other repossessed assets.

(3)

On a tax-equivalent basis.

(4)

Annualized for the three month periods.

(5)

Non-performing loans and assets include the guaranteed portion of non-accrual SBA loans totaling $40.3 million or 0.16% of total loans and 0.11% of total assets at December 31, 2022 and $46.1 million or 0.19% of total loans and 0.13% of total assets at December 31, 2021.

December 31, 2022

December 31, 2021

Required to be

Considered Well

Capitalized

BankUnited, Inc.

BankUnited, N.A.

BankUnited, Inc.

BankUnited, N.A.

Capital ratios

Tier 1 leverage

7.5

%

8.4

%

8.4

%

9.6

%

5.0

%

Common Equity Tier 1 (“CET1”) risk-based capital

11.0

%

12.4

%

12.6

%

14.5

%

6.5

%

Total risk-based capital

12.7

%

12.9

%

14.3

%

14.9

%

10.0

%

Non-GAAP Financial Measures

PPNR is a non-GAAP financial measure. Management believes this measure is relevant to understanding the performance of the Company attributable to elements other than the provision for credit losses and the ability of the Company to generate earnings sufficient to cover estimated credit losses, particularly in view of recent volatility of the provision for credit losses. This measure also provides a meaningful basis for comparison to other financial institutions since it is commonly employed and is a measure frequently cited by investors and analysts. The following table reconciles the non-GAAP financial measure of PPNR to the comparable GAAP financial measurement of income before income taxes at the dates indicated (in thousands):

December 31, 2022

September 30, 2022

December 31, 2021

Income before income taxes (GAAP)

$

81,792

$

117,083

$

63,531

Plus: provision for credit losses

39,608

3,720

246

PPNR (non-GAAP)

$

121,400

$

120,803

$

63,777

View source version on businesswire.com: https://www.businesswire.com/news/home/20230119005081/en/

BankUnited, Inc.

Investor Relations:

Leslie N. Lunak, 786-313-1698, [email protected]

KEYWORDS: Florida United States North America

INDUSTRY KEYWORDS: Banking Professional Services Finance

MEDIA:

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Posted on January 19, 2023 6:48 am
Tenet Anticipates Beating Midpoint of Latest 2022 Outlook; Announces Key Leadership Updates

Tenet Anticipates Beating Midpoint of Latest 2022 Outlook; Announces Key Leadership Updates

DALLAS–(BUSINESS WIRE)–
Tenet Healthcare Corporation (Tenet) (NYSE: THC) announced today that it expects to exceed the midpoint of its latest FY22 Adjusted EBITDA Outlook range included in its third quarter 2022 earnings release along with key leadership updates that will help support long-term business performance.

Although Tenet’s financial statement close process is not yet fully completed, the Company anticipates its Adjusted EBITDA, excluding any fourth quarter stimulus grant income related to the pandemic, will be slightly above the mid-point of its Adjusted EBITDA guidance of $3.425 billion for the year ended December 31, 2022.

“Our business units continued to demonstrate effective management capabilities and delivered strong results in the fourth quarter,” said Saum Sutaria, M.D., Chief Executive Officer of Tenet. “All three of our business units are expected to produce Adjusted EBITDA excluding grant income that was at or slightly above the mid-point of our guidance. We look forward to providing more details in a few weeks along with sharing plans to support a successful 2023.”

Additionally, Tenet announced leadership updates and operational organizational changes aligned with the company’s strategic priorities and designed to help ensure continued performance.

The announcement includes the retirement of Daniel Cancelmi, Executive Vice President & Chief Financial Officer, at the end of 2023. A national search is ongoing to identify a high performing successor. The successor will be directly mentored and onboarded by Dan as part of the transition process.

“Dan was instrumental in the recent transformation of Tenet’s performance and improvement of the balance sheet,” said Sutaria. “Dan is an inspirational leader with a long legacy at Tenet, starting as a hospital CFO to becoming our corporate CFO. He is a tireless advocate for our people and company. The strength of our finance function at Corporate and across our business units is a testament to Dan’s leadership, operational acumen, and commitment to Tenet.”

The retirement of Brett Brodnax, President & CEO of USPI, at the end of 2023 was also announced. Additionally, Andy Johnston has returned to USPI as its Chief Administrative Officer to support the evolution of USPI business processes as the company has nearly doubled in scale within the recent years. Andy is anticipated to be promoted once Brett steps down.

“Brett has not just positively shaped USPI, but the overall ambulatory surgery industry. He will always be a distinguished alumnus of the company and a supporter of USPI’s team, community of doctors, and health system partners,” said Sutaria. “Andy is well positioned to step into the USPI President role – he was previously USPI’s Chief Development Officer and Chief Operating Officer of the East Division. I will personally be spending more time with USPI to advance business goals and support the transition.”

Brett has also offered ongoing support in a non-management role after the end of 2023.

The announcement also included the retirement of Roger Davis, President & CEO of Conifer Health Solutions, at the end of the first quarter 2023. A national search is in progress.

“Roger’s thoughtful leadership and commitment to client service has supported Conifer’s operational and commercial improvements,” said Sutaria. “I am confident in the team’s ability to continue Conifer’s positive trajectory.”

Furthermore, Deepali Narula has been promoted to Chief Operating Officer of Conifer. Deepali was previously Senior Vice President, HRCM Operations, where she transformed operations and developed new capabilities that enabled several of Conifer’s recent commercial successes.

Bryan Forry has been promoted to Chief Financial Officer of Conifer. Bryan was previously Controller, Hospital Operations and prior to that led performance management innovation, as well as Chief Financial Officer for Tenet’s Arizona operations.

In addition, the announcement also included the promotions of Maggie Gill, Matthew Stone, and Nicholas Tejeda to Group Presidents of the Company’s hospital segment. The new operational leadership structure allows for greater agility in execution of strategic priorities within Tenet’s acute care hospital markets and will also enhance consistency in operational management.

Maggie Gill has been promoted to Group President – Eastern Group, overseeing Florida, South Carolina, and Massachusetts hospital operations.

Matthew Stone has been promoted to Group President – Central Group, overseeing Central and South Texas, Alabama, and Tennessee hospital operations.

Nicholas Tejeda has been promoted to Group President – Western Group, overseeing West Texas, Northern California, and Orange County – Los Angeles hospital operations.

“Tenet has exceptional talent throughout its operational ranks,” said Sutaria. “The Group Presidents have a track record for driving results, developing high performing teams, and enhancing access to care. I am confident in their ability to help lead our hospital segment.”

About Tenet Healthcare

Tenet Healthcare Corporation (NYSE: THC) is a diversified healthcare services company headquartered in Dallas. Our care delivery network includes United Surgical Partners International, the largest ambulatory platform in the country, which operates or has ownership interests in more than 465 ambulatory surgery centers and surgical hospitals. We also operate 61 acute care and specialty hospitals, approximately 110 other outpatient facilities, a network of leading employed physicians and a global business center in Manila, Philippines. Our Conifer Health Solutions subsidiary provides revenue cycle management and value-based care services to hospitals, health systems, physician practices, employers, and other clients. Across the Tenet enterprise, we are united by our mission to deliver quality, compassionate care in the communities we serve. For more information, please visit www.tenethealth.com.

Non-GAAP Financial Measures

The Company has not provided the most directly comparable GAAP financial measure, or a quantitative reconciliation thereto, for its expected 2022 Adjusted EBITDA because at this time we have not yet finalized all the data to be able to reconcile certain forward-looking non-GAAP financial measures to the most comparable U.S. GAAP financial measures without unreasonable efforts due to uncertainty in predicting certain items.

Reconciliations of non-GAAP measures, such as Adjusted EBITDA, to the most comparable GAAP measures and management’s reasoning for using them are included in the Company’s earnings press release dated October 20, 2022, which is available on the investor relations section of the Company’s website at www.tenethealth.com/investors. Investors are encouraged to read these detailed financial disclosures and reconciliations.

Cautionary Statement

This release contains “forward-looking statements” – that is, statements that relate to future, not past, events. In this context, forward-looking statements often address the Company’s expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “assume,” “believe,” “budget,” “estimate,” “forecast,” “intend,” “plan,” “predict,” “project,” “seek,” “see,” “target,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain, especially with regards to developments related to COVID-19. Particular uncertainties that could cause the Company’s actual results to be materially different than those expressed in the Company’s forward-looking statements include, but are not limited to, the impact of the COVID-19 pandemic and other factors disclosed under “Forward-Looking Statements” and “Risk Factors” in our Form 10-K for the year ended December 31, 2021, subsequent Form 10-Q filings and other filings with the Securities and Exchange Commission.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230118006041/en/

Investor Contact

Will McDowell

469-893-2387

[email protected]

Media Contact

Robert Dyer

469-893-2640

[email protected]

KEYWORDS: Texas United States North America

INDUSTRY KEYWORDS: Hospitals General Health Health Technology Health

MEDIA:

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Posted on January 19, 2023 6:48 am
TELUS International to host Investor Day on February 16, 2023

TELUS International to host Investor Day on February 16, 2023

VANCOUVER, British Columbia–(BUSINESS WIRE)–
TELUS International (NYSE and TSX: TIXT), a leading digital customer experience innovator that designs, builds and delivers next-generation solutions, including AI and content moderation, for global and disruptive brands, today announced it plans to host an Investor Day on February 16, 2023. The event will consist of management presentations, along with a question and answer session.

A public webcast of the Investor Day will be streamed live on February 16, 2023, starting at 9 a.m. (ET) and is expected to conclude by 12 p.m. (ET) on the TELUS International Investor Relations website at: https://www.telusinternational.com/investors/news-events. A replay of the webcast recording will also be available following the event.

About TELUS International

TELUS International (NYSE & TSX: TIXT) designs, builds and delivers next-generation digital solutions to enhance the customer experience (CX) for global and disruptive brands. The company’s services support the full lifecycle of its clients’ digital transformation journeys, enabling them to more quickly embrace next-generation digital technologies to deliver better business outcomes. TELUS International’s integrated solutions span digital strategy, innovation, consulting and design, IT lifecycle including managed solutions, intelligent automation and end-to-end AI data solutions including computer vision capabilities, as well as omnichannel CX and trust and safety solutions including content moderation. Fueling all stages of company growth, TELUS International partners with brands across high-growth industry verticals, including tech and games, communications and media, eCommerce and fintech, banking, financial services and insurance, healthcare, and travel and hospitality.

TELUS International’s unique caring culture promotes diversity and inclusivity through its policies, team member resource groups and workshops, and equal employment opportunity hiring practices across the regions where it operates. Since 2007, the company has positively impacted the lives of more than one million citizens around the world, building stronger communities and helping those in need through large-scale volunteer events and charitable giving. Five TELUS International Community Boards have provided $4.9 million in funding to grassroots charitable organizations since 2011. Learn more at: telusinternational.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230119005222/en/

TELUS International Investor Relations

Jason Mayr

(604) 695-3455

[email protected]

TELUS International Media Relations

Ali Wilson

(604) 328-7093

[email protected]

KEYWORDS: North America Canada

INDUSTRY KEYWORDS: Technology Fintech Electronic Commerce Communications Professional Services Software Networks Digital Marketing Data Management Artificial Intelligence

MEDIA:

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Posted on January 19, 2023 6:48 am
Canada Goose Announces Third Quarter 2023 Earnings Release Date, Conference Call and Webcast

Canada Goose Announces Third Quarter 2023 Earnings Release Date, Conference Call and Webcast

TORONTO–(BUSINESS WIRE)–
Canada Goose Holdings Inc. (“Canada Goose” or the “Company”) (NYSE: GOOS, TSX: GOOS) today announced that the Company plans to issue results for the third quarter of fiscal year 2023, ended January 1, 2023, prior to the market open on Thursday, February 2, 2023.

The Company will host an investor conference call and webcast to review these financial results at 9:00am ET on the same day. The webcast can be accessed at http://investor.canadagoose.com. The conference call can be accessed by using the following link: Canada Goose Q3 2023 Earnings Call. After registering, an email will be sent including dial-in details and a unique conference call pin required to join the live call. An online archive of the webcast will be available within two hours of the completion of the call and will be accessible on the Company’s website until February 1, 2024.

About Canada Goose

Founded in 1957 in a small warehouse in Toronto, Canada, Canada Goose (NYSE:GOOS, TSX:GOOS) is a lifestyle brand and a leading manufacturer of performance luxury apparel. Every collection is informed by the rugged demands of the Arctic, ensuring a legacy of functionality is embedded in every product from parkas and rainwear to apparel and accessories. Canada Goose is inspired by relentless innovation and uncompromised craftsmanship, recognized as a leader for its Made in Canada commitment. In 2020, Canada Goose announced HUMANATURE, its purpose platform that unites its sustainability and values-based initiatives, reinforcing its commitment to keep the planet cold and the people on it warm. Canada Goose also owns Baffin, a Canadian designer and manufacturer of performance outdoor and industrial footwear. Visit www.canadagoose.com for more information.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230119005048/en/

Investors:

[email protected]

Media:

[email protected]

KEYWORDS: United States North America Canada

INDUSTRY KEYWORDS: Fashion Footwear Retail Luxury Manufacturing Textiles

MEDIA:

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