Materion Corporation (NYSE: MTRN) today reported fourth quarter
and record full-year 2023 financial results, provided 2024 earnings
guidance and shared an update on key strategic initiatives.
Fourth Quarter 2023 Financial Summary
- Net sales were $421.0 million; value-added sales1 were $289.7
million
- Net income was $19.5 million, or $0.93 per share, diluted, and
adjusted earnings of $1.41 per share
Full-Year 2023 Highlights
- Net sales were $1.67 billion; value-added sales were $1.13
billion, a record for the company, up 1% from prior year despite
significant semiconductor market weakness
- Net income of $95.7 million, versus $86.0 million in the prior
year
- Earnings per share of $4.58, diluted, versus $4.14 in the prior
year, and record adjusted earnings of $5.64 per share, versus $5.27
in the prior year, an increase of 7%
- Adjusted EBITDA2 of $217.7 million, or 19.3% of value-added
sales, both records for the company, versus $196.0 million, or
17.6% in the prior year, with 170 bps of margin expansion year on
year
Newly Announced Customer Partnerships
- Announced three new advancements as we continue to strengthen
our organic pipeline
- Secured a fourth order valued at $36 million to supply critical
materials for space propulsion systems
- Awarded $4 million from a government agency for the development
of additive manufacturing processes for advanced materials to serve
the Aerospace, Defense and Energy markets
- Secured another customer contract to supply optical components
for LIDAR technologies within NextGen autonomous vehicle
applications in Europe
“I am proud of our global team for delivering another record
year, despite the significant headwinds facing our largest end
market,” Materion President and CEO Jugal Vijayvargiya said. “Our
strong performance reflects the power of our diverse megatrend
aligned portfolio, which continues to open new pathways for growth,
and the importance of our relentless focus on driving operational
excellence.”
“We have made remarkable progress expanding our margins, despite
market softness,” Vijayvargiya said. “These efforts, combined with
the continued strength of our organic pipeline, leave us
well-positioned to take advantage of the market recoveries as they
develop.”
FOURTH QUARTER 2023
RESULTS
Net sales for the quarter were $421.0 million, compared to
$434.6 million in the prior year period. Value-added sales were
$289.7 million for the quarter, down 4% from prior year due to
significant semiconductor market weakness, partially offset by
strength in aerospace & defense.
Operating profit for the quarter was $27.6 million and net
income was $19.5 million, or $0.93 per diluted share, compared to
operating profit of $39.2 million and net income of $28.8 million,
or $1.38 per share, in the prior year period.
Excluding special items3 primarily related to targeted cost
improvement initiatives and precision clad strip start-up costs,
adjusted EBITDA was $53.3 million in the quarter, compared to $55.6
million in the prior year period. The strong performance was driven
mainly by focused operational execution and improved mix, despite
softer volume.
Adjusted net income was $29.6 million excluding acquisition
amortization, or $1.41 per diluted share, compared to $1.49 per
share in the prior year period.
FULL-YEAR 2023 RESULTS
Net sales for the year were $1.67 billion, compared to $1.76
billion in the prior year. Value-added sales were $1.13 billion for
the year, up 1% from prior year due to strength in aerospace &
defense and precision clad strip, offset by softness in several key
end markets.
Operating profit for the year was $136.4 million and net income
was $95.7 million, or $4.58 per diluted share, compared to
operating profit of $119.8 million and net income of $86.0 million,
or $4.14 per diluted share, in the prior year.
Excluding special items, adjusted EBITDA for the year was $217.7
million, compared to $196.0 million in the prior year. The increase
was driven mainly by strong operational performance, including the
targeted cost improvement initiatives, and improved mix driven by
new business.
Adjusted net income was $118.0 million excluding acquisition
amortization, or $5.64 per diluted share, an increase of 7%
compared to $5.27 per diluted share in the prior year.
OUTLOOK
While we expect some of our key end markets to remain challenged
in the near term due to macroeconomic conditions, we expect another
year of record results driven by our organic pipeline and close
customer partnerships. We believe these growth drivers, along with
continued operational excellence and targeted cost improvement
initiatives, will help drive earnings growth. With this, we are
guiding to the range of $6.10 to $6.50 for full year 2024 adjusted
earnings per share, an increase of 12% from prior year at the
midpoint.
ADJUSTED EARNINGS
GUIDANCE
It is not possible for the Company to identify the amount or
significance of future adjustments associated with potential
insurance and litigation claims, legacy environmental costs,
acquisition and integration costs, certain income tax items, or
other non-routine costs that the Company adjusts in the
presentation of adjusted earnings guidance. These items are
dependent on future events that are not reasonably estimable at
this time. Accordingly, the Company is unable to reconcile without
unreasonable effort the forecasted range of adjusted earnings
guidance for the full year to a comparable GAAP range. However,
items excluded from the Company's adjusted earnings guidance
include the historical adjustments noted in Attachments 4 through 8
to this press release.
CONFERENCE CALL
Materion Corporation will host an investor conference call with
analysts at 9:00 a.m. Eastern Time, February 15, 2024. The
conference call will be available via webcast through the Company’s
website at www.materion.com. By phone, please dial (888) 506-0062.
Calls outside the U.S. can dial (973) 528-0011; please reference
participant access code of 570395. A replay of the call will be
available until February 29, 2024 by dialing (877) 481-4010 or
(919) 882-2331 if international; please reference replay ID number
49161. The call will also be archived on the Company’s website.
FOOTNOTES
1 Value-added sales deducts the impact of pass-through metals
from net sales 2 EBITDA represents earnings before interest, taxes,
depreciation, depletion and amortization 3 Details of the special
items can be found in Attachments 4 through 8
ABOUT MATERION
Materion Corporation is a global leader in advanced materials
solutions for high-performance industries including semiconductor,
industrial, aerospace & defense, energy and automotive. With
nearly 100 years of expertise in specialty engineered alloy
systems, inorganic chemicals and powders, precious and non-precious
metals, beryllium and beryllium composites, and precision filters
and optical coatings, Materion partners with customers to enable
breakthrough solutions that move the world forward. Headquartered
in Mayfield Heights, Ohio, the company employs more than 3,500
talented people worldwide, serving customers in more than 60
countries.
FORWARD-LOOKING
STATEMENTS
Portions of the narrative set forth in this document that are
not statements of historical or current facts are forward-looking
statements. Our actual future performance may materially differ
from that contemplated by the forward-looking statements as a
result of a variety of factors. These factors include, in addition
to those mentioned elsewhere herein: the global economy, including
inflationary pressures, potential future recessionary conditions
and the impact of tariffs and trade agreements; the impact of any
U.S. Federal Government shutdowns or sequestrations; the condition
of the markets which we serve, whether defined geographically or by
segment; changes in product mix and the financial condition of
customers; our success in developing and introducing new products
and new product ramp-up rates; our success in passing through the
costs of raw materials to customers or otherwise mitigating
fluctuating prices for those materials, including the impact of
fluctuating prices on inventory values; our success in identifying
acquisition candidates and in acquiring and integrating such
businesses; the impact of the results of acquisitions on our
ability to fully achieve the strategic and financial objectives
related to these acquisitions; our success in implementing our
strategic plans and the timely and successful start-up and
completion of any capital projects; other financial and economic
factors, including the cost and availability of raw materials (both
base and precious metals), physical inventory valuations, metal
consignment fees, tax rates, exchange rates, interest rates,
pension costs and required cash contributions and other employee
benefit costs, energy costs, regulatory compliance costs, the cost
and availability of insurance, credit availability, and the impact
of the Company’s stock price on the cost of incentive compensation
plans; the uncertainties related to the impact of war, terrorist
activities, and acts of God; changes in government regulatory
requirements and the enactment of new legislation that impacts our
obligations and operations; the conclusion of pending litigation
matters in accordance with our expectation that there will be no
material adverse effects; the disruptions in operations from, and
other effects of, catastrophic and other extraordinary events
including outbreaks from infectious diseases and the conflict
between Russia and Ukraine and other hostilities; realization of
expected financial benefits expected from the Inflation Reduction
Act of 2022; and the risk factors set forth in Part 1, Item 1A of
the Company's 2022 Annual Report on Form 10-K and in other reports
that we file with the SEC.
Attachment 1
Materion Corporation and
Subsidiaries
Consolidated Statements of
Income
(Unaudited)
Fourth Quarter Ended
Year Ended
(In thousands except per share
amounts)
December 31,
2023
December 31,
2022
December 31,
2023
December 31,
2022
Net sales
$
421,043
$
434,578
$
1,665,187
$
1,757,109
Cost of sales
341,328
336,159
1,316,145
1,413,229
Gross margin
79,715
98,419
349,042
343,880
Selling, general, and administrative
expense
39,858
46,672
157,911
169,338
Research and development expense
6,442
6,881
27,540
28,977
Restructuring expense (income)
630
13
3,824
1,573
Other — net
5,145
5,662
23,323
24,237
Operating profit
27,640
39,191
136,444
119,755
Other non-operating (income)
expense—net
(569
)
(1,738
)
(2,710
)
(5,250
)
Interest expense — net
8,503
7,580
31,323
21,905
Income before income taxes
19,706
33,349
107,831
103,100
Income tax (benefit) expense
238
4,585
12,129
17,110
Net income
$
19,468
$
28,764
$
95,702
$
85,990
Basic earnings per share:
Net income per share of common stock
$
0.94
$
1.40
$
4.64
$
4.19
Diluted earnings per share:
Net income per share of common stock
$
0.93
$
1.38
$
4.58
$
4.14
Weighted-average number of shares of
common stock outstanding:
Basic
20,644
20,537
20,619
20,511
Diluted
20,936
20,790
20,911
20,760
Attachment 2
Materion Corporation and
Subsidiaries
Consolidated Balance
Sheets
(Unaudited)
(Thousands)
December 31,
2023
December 31,
2022
Assets
Current assets
Cash and cash equivalents
$
13,294
$
13,101
Accounts receivable, net
192,747
215,211
Inventories, net
441,597
423,080
Prepaid and other current assets
61,744
39,056
Total current assets
709,382
690,448
Deferred income taxes
4,908
3,265
Property, plant, and equipment
1,281,622
1,209,205
Less allowances for depreciation,
depletion, and amortization
(766,939
)
(760,440
)
Property, plant, and equipment—net
514,683
448,765
Operating lease, right-of-use assets
57,645
64,249
Intangible assets
133,571
143,219
Other assets
21,664
22,535
Goodwill
320,873
319,498
Total Assets
$
1,762,726
$
1,691,979
Liabilities and Shareholders’
Equity
Current liabilities
Short-term debt
$
38,597
$
21,105
Accounts payable
125,663
107,899
Salaries and wages
25,912
35,543
Other liabilities and accrued items
45,773
54,993
Income taxes
5,207
3,928
Unearned revenue
13,843
15,496
Total current liabilities
254,995
238,964
Other long-term liabilities
13,300
12,181
Operating lease liabilities
53,817
59,055
Finance lease liabilities
13,744
13,876
Retirement and post-employment
benefits
26,334
20,422
Unearned income
103,983
107,736
Long-term income taxes
3,815
665
Deferred income taxes
20,109
28,214
Long-term debt
387,576
410,876
Shareholders’ equity
885,053
799,990
Total Liabilities and Shareholders’
Equity
$
1,762,726
$
1,691,979
Attachment 3
Materion Corporation and
Subsidiaries
Consolidated Statements of
Cash Flows
(Thousands)
December 31,
2023
December 31,
2022
Cash flows from operating activities:
Net income
$
95,702
$
85,990
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation, depletion, and
amortization
61,644
53,436
Amortization of deferred financing costs
in interest expense
1,712
1,734
Stock-based compensation expense
(non-cash)
10,092
8,813
Amortization of pension and
post-retirement costs
(1,318
)
(146
)
(Gain) loss on sale of property, plant,
and equipment
20
14
Deferred income tax (benefit) expense
(7,005
)
1,733
Net pension curtailments and
settlements
142
(551
)
Changes in assets and liabilities, net of
acquired assets and liabilities:
Decrease (increase) in accounts
receivable
23,359
(4,377
)
Decrease (increase) in inventory
(18,700
)
(63,986
)
Decrease (increase) in prepaid and other
current assets
(22,663
)
(1,604
)
Increase (decrease) in accounts payable
and accrued expenses
6,631
12,860
Increase (decrease) in unearned
revenue
(17,361
)
207
Increase (decrease) in interest and taxes
payable
3,771
154
Increase (decrease) in unearned income due
to customer prepayments
16,676
21,942
Other — net
(8,288
)
(261
)
Net cash provided by operating
activities
144,414
115,958
Cash flows from investing activities:
Payments for acquisition, net of cash
acquired
—
(2,971
)
Payments for purchase of property, plant,
and equipment
(110,550
)
(77,608
)
Payments for mine development
(9,326
)
—
Proceeds from sale of property, plant, and
equipment
654
850
Net cash used in investing
activities
(119,222
)
(79,729
)
Cash flows from financing activities:
Proceeds from (repayment of) borrowings
under credit facilities, net
8,065
230
Repayment of debt
(15,415
)
(19,299
)
Principal payments under finance lease
obligations
(1,645
)
(2,736
)
Cash dividends paid
(10,621
)
(10,160
)
Payments of withholding taxes for
stock-based compensation awards
(5,234
)
(3,593
)
Net cash provided by (used in)
financing activities
(24,850
)
(35,558
)
Effects of exchange rate changes
(149
)
(2,032
)
Net change in cash and cash
equivalents
193
(1,361
)
Cash and cash equivalents at beginning
of period
13,101
14,462
Cash and cash equivalents at end of
period
$
13,294
$
13,101
Attachment 4
Materion Corporation and
Subsidiaries
Reconciliation of Non-GAAP
Measure - Value-added Sales, Operating Profit, and EBITDA
(Unaudited)
Fourth Quarter Ended
Year Ended
(Millions)
December 31,
2023
December 31,
2022
December 31,
2023
December 31,
2022
Net Sales
Performance Materials
$
201.1
$
197.6
$
755.5
$
671.5
Electronic Materials
193.9
209.3
805.8
971.9
Precision Optics
26.0
27.7
103.9
113.7
Other
—
—
—
—
Total
$
421.0
$
434.6
$
1,665.2
$
1,757.1
Less: Pass-through Metal Cost
Performance Materials
$
15.1
$
20.0
$
66.9
$
82.0
Electronic Materials
116.2
111.5
471.1
559.1
Precision Optics
—
—
0.1
0.1
Other
—
0.1
—
1.5
Total
$
131.3
$
131.6
$
538.1
$
642.7
Value-added Sales (non-GAAP)
Performance Materials
$
186.0
$
177.6
$
688.6
$
589.5
Electronic Materials
77.7
97.8
334.7
412.8
Precision Optics
26.0
27.7
103.8
113.6
Other
—
(0.1
)
—
(1.5
)
Total
$
289.7
$
303.0
$
1,127.1
$
1,114.4
Gross Margin
Performance Materials(1)
$
50.5
$
57.7
$
216.5
$
175.1
Electronic Materials(1)
21.5
31.5
100.4
131.5
Precision Optics(1)
7.7
9.2
32.1
37.3
Other
—
—
—
—
Total(1)
$
79.7
$
98.4
$
349.0
$
343.9
(1) See reconciliation of gross margin to
adjusted gross margin in Attachment 8
Note: Quarterly information presented
within this document and previously disclosed quarterly information
may not equal the total computed for the year due to rounding
Fourth Quarter Ended
Year Ended
(Millions)
December 31,
2023
December 31,
2022
December 31,
2023
December 31,
2022
Operating Profit (Loss)
Performance Materials
$
33.0
$
37.6
$
143.9
$
101.4
Electronic Materials
3.8
12.3
28.6
51.3
Precision Optics
(0.4
)
1.1
(2.0
)
1.9
Other
(8.8
)
(11.8
)
(34.1
)
(34.8
)
Total
$
27.6
$
39.2
$
136.4
$
119.8
Non-Operating (Income) Expense
Performance Materials
$
0.2
$
0.1
$
0.6
$
0.5
Electronic Materials
(0.1
)
—
(0.1
)
—
Precision Optics
—
(0.6
)
(0.6
)
(1.3
)
Other
(0.7
)
(1.2
)
(2.7
)
(4.4
)
Total
$
(0.6
)
$
(1.7
)
$
(2.8
)
$
(5.2
)
Depreciation, Depletion, and
Amortization
Performance Materials
$
7.6
$
6.8
$
31.2
$
24.3
Electronic Materials
4.3
4.2
17.0
16.5
Precision Optics
2.6
2.7
11.3
10.5
Other
0.6
0.5
2.1
2.1
Total
$
15.1
$
14.2
$
61.6
$
53.4
Segment EBITDA
Performance Materials
$
40.4
$
44.3
$
174.5
$
125.2
Electronic Materials
8.2
16.5
45.7
67.8
Precision Optics
2.2
4.4
9.9
13.7
Other
(7.5
)
(10.1
)
(29.3
)
(28.3
)
Total
$
43.3
$
55.1
$
200.8
$
178.4
Special Items(2)
Performance Materials
$
5.6
$
—
$
6.7
$
6.8
Electronic Materials
2.8
0.6
7.3
8.2
Precision Optics
1.6
(0.4
)
2.8
0.3
Other
—
0.3
0.1
2.3
Total
$
10.0
$
0.5
$
16.9
$
17.6
Adjusted EBITDA Excluding Special
Items
Performance Materials
$
46.0
$
44.3
$
181.2
$
132.0
Electronic Materials
11.0
17.1
53.0
76.0
Precision Optics
3.8
4.0
12.7
14.0
Other
(7.5
)
(9.8
)
(29.2
)
(26.0
)
Total
$
53.3
$
55.6
$
217.7
$
196.0
The cost of gold, silver,
platinum, palladium, copper, ruthenium, iridium, rhodium, rhenium,
and osmium is passed through to customers and, therefore, the
trends and comparisons of net sales are affected by movements in
the market price of these metals. Internally, management also
reviews net sales on a value-added basis. Value-added sales is a
non-GAAP financial measure that deducts the value of the
pass-through metals sold from net sales. Value-added sales allows
management to assess the impact of differences in net sales between
periods or segments and analyze the resulting margins and
profitability without the distortion of the movements in
pass-through market metal prices. The dollar amount of gross margin
and operating profit is not affected by the value-added sales
calculation. The Company sells other metals and materials that are
not considered direct pass throughs, and these costs are not
deducted from net sales to calculate value-added sales.
The Company’s pricing policy is
to pass the cost of these metals on to customers in order to
mitigate the impact of price volatility on the Company’s results
from operations. Value-added information is being presented since
changes in metal prices may not directly impact profitability. It
is the Company’s intent to allow users of the financial statements
to review sales with and without the impact of the pass-through
metals.
(2) See additional details of
special items in Attachment 5.
Attachment 5
Materion Corporation and
Subsidiaries
Reconciliation of Net Sales to
Value-added Sales, Net Income to EBITDA and Adjusted EBITDA
(Unaudited)
Fourth Quarter Ended
Twelve Months Ended
(Millions)
December
31, 2023
% of VA
December
31, 2022
% of VA
December
31, 2023
% of VA
December
31, 2022
% of VA
Net sales
$
421.0
$
434.6
$
1,665.2
$
1,757.1
Pass-through metal cost
131.3
131.6
538.1
642.7
Value-added sales
$
289.7
$
303.0
$
1,127.1
$
1,114.4
Net income
$
19.5
6.7
%
$
28.8
9.5
%
$
95.7
8.5
%
$
86.0
7.7
%
Income tax expense
0.2
0.1
%
4.5
1.5
%
12.2
1.1
%
17.1
1.5
%
Interest expense - net
8.5
2.9
%
7.6
2.5
%
31.3
2.8
%
21.9
2.0
%
Depreciation, depletion and
amortization
15.1
5.2
%
14.2
4.7
%
61.6
5.5
%
53.4
4.8
%
Consolidated EBITDA
$
43.3
14.9
%
$
55.1
18.2
%
$
200.8
17.8
%
$
178.4
16.0
%
Special items
Restructuring and cost reduction
$
4.2
1.4
%
$
—
—
%
$
11.1
1.0
%
$
1.5
0.1
%
Pension settlement
0.2
0.1
%
(0.5
)
(0.2
)%
0.2
—
%
(0.5
)
—
%
Additional start up resources and
scrap
5.6
1.9
%
—
—
%
5.6
0.5
%
4.1
0.4
%
Merger and acquisition costs
—
—
%
1.0
0.3
%
—
—
%
12.5
1.1
%
Total special items
10.0
3.5
%
0.5
0.2
%
16.9
1.5
%
17.6
1.6
%
Adjusted EBITDA
$
53.3
18.4
%
$
55.6
18.3
%
$
217.7
19.3
%
$
196.0
17.6
%
In addition to presenting financial
statements prepared in accordance with U.S. generally accepted
accounting principles (GAAP), this earnings release contains
financial measures, including operating profit, segment operating
profit, earnings before interest, taxes, depreciation, depletion
and amortization (EBITDA), net income, and earnings per share, on a
non-GAAP basis. As detailed in the above reconciliation and
Attachment 6, we have adjusted the results for certain special
items such as restructuring and cost reductions (which includes
costs associated with temporarily idled facilities as a result of
decreased demand), additional start up resources and scrap and
merger and acquisition costs. Internally, management reviews the
results of operations without the impact of these costs in order to
assess the profitability from ongoing activities. We are providing
this information because we believe it will assist investors in
analyzing our financial results and, when viewed in conjunction
with the GAAP results, provide a more comprehensive understanding
of the factors and trends affecting our operations.
Attachment 6
Materion Corporation and
Subsidiaries
Reconciliation of Net Income
to Adjusted Net Income
and Diluted Earnings per Share
to Adjusted Diluted Earnings per Share (Unaudited)
Fourth Quarter Ended
Twelve Months Ended
(Millions)
December
31, 2023
Diluted
EPS
December
31, 2022
Diluted
EPS
December
31, 2023
Diluted
EPS
December
31, 2022
Diluted
EPS
Net income and EPS
$
19.5
$
0.93
$
28.8
$
1.38
$
95.7
$
4.58
$
86.0
$
4.14
Special items
Restructuring and cost reduction
4.2
—
11.1
1.5
Additional start up resources and
scrap
5.6
—
5.6
4.1
Merger and acquisition costs
—
1.0
—
12.5
Pension settlement
0.2
(0.5
)
0.2
(0.5
)
Provision for income taxes (1)
(2.4
)
(0.8
)
(4.4
)
(3.9
)
Total special items
7.6
0.36
(0.3
)
(0.01
)
12.5
0.60
13.7
0.66
Adjusted net income and adjusted EPS
$
27.1
$
1.29
$
28.5
$
1.37
$
108.2
$
5.17
$
99.7
$
4.80
Acquisition amortization (net of tax)
2.5
0.12
2.4
0.12
9.8
0.47
9.8
0.47
Adjusted net income and adjusted EPS excl.
amortization
$
29.6
$
1.41
$
30.9
$
1.49
$
118.0
$
5.64
$
109.5
$
5.27
(1) Provision for income taxes includes
the net tax impact on pre-tax adjustments (listed above), the
impact of certain discrete tax items recorded during the respective
periods as well as other adjustments to reflect the use of one
overall effective tax rate on adjusted pre-tax income in interim
periods.
Attachment 7
Reconciliation of Segment Net
sales to Segment Value-added sales and Segment EBITDA to Adjusted
Segment EBITDA (Unaudited)
Performance Materials
Fourth Quarter Ended
Twelve Months Ended
(Millions)
December
31, 2023
% of VA
December
31, 2022
% of VA
December
31, 2023
% of VA
December
31, 2022
% of VA
Net sales
$
201.1
$
197.6
$
755.5
$
671.5
Pass-through metal cost
15.1
20.0
66.9
82.0
Value-added sales
$
186.0
$
177.6
$
688.6
$
589.5
EBITDA
$
40.4
21.7
%
$
44.3
24.9
%
$
174.5
25.3
%
$
125.2
21.2
%
Restructuring and cost reduction
—
—
%
—
—
%
1.1
0.2
%
—
—
%
Additional start up resources and
scrap
5.6
3.0
%
—
—
%
5.6
0.8
%
4.1
0.7
%
Merger and acquisition costs
—
—
%
—
—
%
—
—
%
2.7
0.5
%
Adjusted EBITDA
$
46.0
24.7
%
$
44.3
24.9
%
$
181.2
26.3
%
$
132.0
22.4
%
Electronic Materials
Fourth Quarter Ended
Twelve Months Ended
(Millions)
December 31, 2023
% of VA
December 31, 2022
% of VA
December 31, 2023
% of VA
December 31, 2022
% of VA
Net sales
$
193.9
$
209.3
$
805.8
$
971.9
Pass-through metal cost
116.2
111.5
471.1
559.1
Value-added sales
$
77.7
$
97.8
$
334.7
$
412.8
EBITDA
$
8.2
10.6
%
$
16.5
16.9
%
$
45.7
13.7
%
$
67.8
16.4
%
Restructuring and cost reduction
2.8
3.6
%
—
—
%
7.3
2.2
%
0.8
0.2
%
Merger and acquisition costs
—
—
%
0.6
0.6
%
—
—
%
7.4
1.8
%
Adjusted EBITDA
$
11.0
14.2
%
$
17.1
17.5
%
$
53.0
15.8
%
$
76.0
18.4
%
Precision Optics
Fourth Quarter Ended
Twelve Months Ended
(Millions)
December
31, 2023
% of VA
December
31, 2022
% of VA
December
31, 2023
% of VA
December
31, 2022
% of VA
Net sales
$
26.0
$
27.7
$
103.9
$
113.7
Pass-through metal cost
—
—
0.1
0.1
Value-added sales
$
26.0
$
27.7
$
103.8
$
113.6
EBITDA
$
2.2
8.5
%
$
4.4
15.9
%
$
9.9
9.5
%
$
13.7
12.1
%
Restructuring and cost reduction
1.4
5.4
%
—
—
%
2.6
2.5
%
0.6
0.5
%
Pension settlement
0.2
0.8
%
(0.5
)
(1.8
)%
0.2
0.2
%
(0.5
)
(0.4
)%
Merger and acquisition costs
—
—
%
0.1
0.4
%
—
—
%
0.2
0.2
%
Adjusted EBITDA
$
3.8
14.7
%
$
4.0
14.4
%
$
12.7
12.2
%
$
14.0
12.3
%
Other
Fourth Quarter Ended
Twelve Months Ended
(Millions)
December
31, 2023
% of VA
December
31, 2022
% of VA
December
31, 2023
% of VA
December
31, 2022
% of VA
EBITDA
$
(7.5
)
$
(10.1
)
$
(29.3
)
$
(28.3
)
Restructuring and cost reduction
—
—
0.1
0.1
Merger and acquisition costs
—
0.3
—
2.2
Adjusted EBITDA
$
(7.5
)
$
(9.8
)
$
(29.2
)
$
(26.0
)
Attachment 8
Materion Corporation and
Subsidiaries
Reconciliation of Non-GAAP
Measure - Gross Margin to Adjusted Gross Margin
(Unaudited)
Fourth Quarter Ended
Twelve Months Ended
(Millions)
December 31,
2023
December 31,
2022
December 31,
2023
December 31,
2022
Gross Margin
Performance Materials
$
50.5
$
57.7
$
216.5
$
175.1
Electronic Materials
21.5
31.5
100.4
131.5
Precision Optics
7.7
9.2
32.1
37.3
Other
—
—
—
—
Total
$
79.7
$
98.4
$
349.0
$
343.9
Special Items (1)
Performance Materials
$
5.6
$
—
$
6.4
$
6.7
Electronic Materials
1.5
—
3.9
5.0
Precision Optics
1.0
—
1.3
—
Other
—
—
—
—
Total
$
8.1
$
—
$
11.6
$
11.7
Adjusted Gross Margin
Performance Materials
$
56.1
$
57.7
$
222.9
$
181.8
Electronic Materials
23.0
31.5
104.3
136.5
Precision Optics
8.7
9.2
33.4
37.3
Other
—
—
—
—
Total
$
87.8
$
98.4
$
360.6
$
355.6
(1) Special items impacting gross margin
represent restructuring and cost reduction and additional start up
resources and scrap in 2023 and merger and acquisition costs in
2022.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240214669030/en/
Investor Contact: Kyle Kelleher
(216) 383-4931 kyle.kelleher@materion.com
Media Contact: Jason Saragian (216)
383-6893 jason.saragian@materion.com
https://materion.com Mayfield Hts-g
Grafico Azioni Materion (NYSE:MTRN)
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