Énoncés prospectifs
This Quarterly Report on Form 10-Q contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended, and these
statements involve substantial risks and uncertainties. All statements other
than statements of historical fact contained in this Quarterly Report on Form
10-Q are forward-looking statements. Forward-looking statements generally relate
to future events and our future financial or operating performance. Such
statements generally include the words "believes," "plans," "intends,"
"targets," "will," "expects," "suggests," "anticipates," "outlook," "continues"
or the negative of these words or other similar terms or expressions that
concern our expectations, strategy, plans or intentions. Forward-looking
statements include, without limitation, expected financial positions; results of
operations; cash flows; financing plans; business strategy; operating plans;
strategic alternatives; capital and other expenditures; competitive positions;
growth opportunities for existing products; benefits from new technology and
cost reduction initiatives, plans and objectives; and markets for securities.
Like other businesses, we are subject to risks and uncertainties that could
cause our actual results to differ materially from our projections or that could
cause other forward-looking statements to prove incorrect. Factors that could
cause actual results to materially differ from those contained in the
forward-looking statements, or that could cause other forward-looking statements
to prove incorrect, include, without limitation, risks related to the cyclical
and seasonal nature of the industries that GCP serves; foreign operations,
especially in emerging regions; changes in currency exchange rates; business
disruptions due to public health or safety emergencies, such as the novel strain
of coronavirus ("COVID-19") pandemic; the cost and availability of raw materials
and energy; the effectiveness of GCP's research and development, new product
introductions and growth investments; acquisitions and divestitures of assets
and gains and losses from dispositions; developments affecting GCP's outstanding
liquidity and indebtedness, including debt covenants and interest rate exposure;
developments affecting GCP's funded and unfunded pension obligations; the timing
of the closing of the proposed merger, including the risks that a condition to
closing would not be satisfied within the expected timeframe and the occurrence
of any event, change or other circumstance or condition that could give rise to
the termination of the proposed merger agreement; warranty and product liability
claims; legal proceedings; the inability to establish or maintain certain
business relationships and relationships with customers and suppliers or the
inability to retain key personnel; the handling of hazardous materials and the
costs of compliance with environmental regulations; extreme weather events and
natural disasters. These and other factors are identified and described in more
detail in Item 1A in our Annual Report on Form 10-K.
The forward-looking statements made in this Quarterly Report on Form 10-Q and
our reported results should not be considered as an indication of our future
performance. The forward-looking statements made in this Quarterly Report on
Form 10-Q relate only to events as of the date on which the statements are made.
We undertake no obligation to update any forward-looking statements made in this
Quarterly Report on Form 10-Q to reflect events or circumstances after the date
of this Quarterly Report on Form 10-Q or to reflect new information or the
occurrence of unanticipated events, except as required by law.
RÉSULTATS DES OPÉRATIONS
Nous sommes engagés dans la production et la vente de produits chimiques de construction spécialisés et de matériaux de construction spécialisés à travers deux segments d’exploitation mondiaux :
•Specialty Construction Chemicals ("SCC"). Our SCC operating segment provides
products, services and technologies to the concrete and cement industries,
including concrete addmixtures and cement, as well as in-transit monitoring and
management systems, which reduce the cost and improve the performance and
quality of cement, concrete, mortar, masonry, and other cementitious-based
construction materials.
•Specialty Building Materials ("SBM"). Our SBM operating segment produces and
sells sheet and liquid membrane systems and other products that protect both new
and existing structures from water, air, and vapor penetration, as well as from
fire damage. We also manufacture and sell specialized cementitious and chemical
grouts used for soil consolidation and leak-sealing applications in addition to
a moisture barrier system and installation tools for the flooring industry.
We operate our business on a global scale. During the three months ended
March 31, 2022 , approximately 47% of our net sales were generated outside of the
U.S. We operate and have locations in over 30 countries and transact business in
over 30 currencies.
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Projet de fusion
OnDecember 5, 2021 , we entered into the Merger Agreement with Saint-Gobain. Pursuant to the terms of the Merger Agreement, at the effective time of the Merger, each share of our common stock that is issued and outstanding immediately prior to the effective time of the Merger shall be automatically converted into the right to receive$32.00 in cash, without interest. Because the Merger is not yet complete, and except as otherwise specifically stated, the descriptions and disclosures presented elsewhere in this Quarterly Report on Form 10-Q, including those that present forward-looking information, assume the continuation of GCP as a public company. If the Merger is consummated, our actions and results may be different than those anticipated by such forward-looking statements. See Note 20, "Proposed Merger" in the Notes to the Consolidated Financial Statements included in Item 8, "Financial Statements and Supplementary Data" of the 2021 Annual Report on Form 10-K for further information.
Mise à jour de l’entreprise
The global health crisis caused by the COVID-19 outbreak and its resurgences has and will continue to impact global economic activity, particularly the timing of fulfilling demands for our products. Furthermore, macroeconomic factors such as the conflict inUkraine and historic inflation headwinds impacted our results of operation in the first quarter of 2022. Our net sales in the first quarter of 2022 increased 6.5%. Despite this positive momentum, inflation, specifically raw material prices, logistic costs and global supply chain disruptions, had a tangible impact on our quarterly performance. The combination of these factors adversely affected gross margins by approximately 800 basis points. We took actions to protect margins in 2021 and in the first quarter of 2022 by announcing new price increases in all regions to offset the inflationary headwinds we are experiencing. However, the effect of the ongoing global supply chain disruptions and continued increases in the cost of raw materials and freight transportation have outpaced our mitigating efforts and we expect margin compression to remain into the first half of 2022.
Voici un aperçu de notre performance financière pour le premier trimestre terminé
Three Months Ended
March 31,
2022 2021 % Change
(in millions, except per share amounts)
Net sales $ 237.3 $ 222.8 6.5 %
Cost of goods sold 164.3 136.3 20.5 %
Gross profit 73.0 86.5 (15.6) %
Gross margin 30.8 % 38.8 % (800) bps
Selling, general and administrative expenses 62.5 66.6 (6.2) %
Interest expense, net 5.6 5.6 - %
Restructuring and repositioning expenses 3.5 8.9 (60.7) %
Other expense, net 3.1 2.8 10.7 %
(Loss) income from continuing operations before
income taxes (1.7) 2.6 NM
Income tax expense (1.9) (1.0) 90.0 %
Loss from discontinued operations, net of income
taxes (0.3) - (100.0) %
Net (loss) income (3.9) 1.6 NM
Less: Net income attributable to noncontrolling
interests (0.1) (0.1) - %
Bénéfice (perte) net(te) attribuable aux actionnaires de GCP (4,0) $
$ 1.5 NM (Loss) income from continuing operations attributable to GCP shareholders $ (3.7)$ 1.5 NM Diluted EPS from continuing operations attributable to GCP shareholders$ (0.05) $ 0.02 NM 22
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Three Months Ended
March 31,
2022 2021 % Change
(in millions, except per share amounts)
Net sales:
SCC $ 135.6 $ 123.9 9.4 %
SBM 101.7 98.9 2.8 %
Total GCP net sales $ 237.3 $ 222.8 6.5 %
Net sales by region:
North America $ 132.2 $ 118.1 11.9 %
Europe, Middle East, Africa ("EMEA") 45.8 44.6 2.7 %
Asia Pacific 42.1 46.7 (9.9) %
Latin America 17.2 13.4 28.4 %
Total net sales by region $ 237.3 $ 222.8 6.5 %
Résumé des performances du premier trimestre
Voici un résumé de notre performance financière pour le premier trimestre terminé
• Les ventes nettes ont augmenté de 6,5 % pour atteindre
• Le bénéfice brut a diminué de 15,6 % pour
• Les frais de vente, généraux et administratifs (« SG&A ») ont diminué de 6,2 % pour atteindre
• La perte des activités poursuivies attribuable aux actionnaires de GCP a été
GCP OverviewNet Sales and Gross Margin [[Image Removed: gcpwi-20220331_g1.jpg]] 23 --------------------------------------------------------------------------------
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The following table identifies the period-over-period increase or decrease in sales attributable to changes in volume and/or mix, product price, and the impact of currency translation for the three months endedMarch 31, 2022 from the same period in the prior year. Three Months Ended Net Sales Variance Analysis Volume Price Currency Translation Total Change SCC 6.0 % 6.2 % (2.8) % 9.4 % SBM 0.7 % 3.5 % (1.4) % 2.8 % Net sales 3.8 % 4.8 % (2.1) % 6.5 %By Region : North America 7.2 % 4.7 % - % 11.9 % EMEA 1.6 % 4.8 % (3.7) % 2.7 % Asia Pacific (7.5) % 1.0 % (3.4) % (9.9) % Latin America 13.8 % 18.8 % (4.2) % 28.4 % Net sales of$237.3 million for the first quarter endedMarch 31, 2022 increased$14.5 million , or 6.5%, from the prior-year quarter primarily due to favorable sale pricing of 4.8% and volume of 3.8% particularly inLatin America ,North America and EMEA. This was partially offset by decreases in volume inAsia Pacific and foreign currency translation.
Bénéfice brut de
diminué
SG&A
SG&A costs of$62.5 million decreased$4.1 million or 6.2%, for the first quarter endedMarch 31, 2022 compared to the prior-year quarter primarily due to lower employee and Cambridge headquarters-related costs resulting from restructuring programs and lower incentives compensation costs. These favorable impacts were partially offset by additional Merger-related costs.
Frais de restructuration et de repositionnement
Plan de Restructuration 2021
Cumulative costs incurred under the 2021 Plan since its inception were$34.9 million with expected total costs of up to$37.0 million . We have achieved total annualized pre-tax cost savings through a reduction in general and administrative expenses and a reduction in overhead costs under the 2021 Plan of approximately$12 million atMarch 31, 2022 , which benefited both the SCC and the SBM operating segments and corporate functions. We expect to realize total pre-tax cost structure savings associated with the 2021 Plan of approximately$13 million to$15 million mostly in general, administrative and overhead costs, with most of the savings occurring in 2022. Substantially all of the restructuring actions under the 2021 Plan are expected to be completed byJune 2022 . With the exception of asset write offs, substantially all of the restructuring and repositioning activities are expected to be settled in cash.
Plan de restructuration et de repositionnement de la phase 2 2019
Cumulative costs incurred under the 2019 Phase 2 Plan since its inception were$33.2 million . We have achieved total annualized pre-tax cost savings through a reduction in general and administrative expenses under the 2019 Phase 2 Plan of approximately$20.2 million atMarch 31, 2022 , which benefited both the SCC and the SBM operating segments and corporate functions. Substantially all of the activities under the 2019 Phase 2 Plan were completed byMarch 2021 .
Pour plus d’informations sur nos dépenses de restructuration, veuillez vous reporter à la note 3, « Frais de restructuration et de repositionnement » des notes aux états financiers consolidés résumés non audités.
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Charge de retraite
Defined benefit expense includes costs relating toU.S. and non-U.S. defined benefit pension and other postretirement benefit plans that provide benefits for retirees and former employees of divested businesses where we retained these obligations. Certain pension costs represent ongoing costs recognized quarterly, including service and interest costs, expected return on plan assets and amortization of prior service costs/credits. Certain pension costs during the first quarter endedMarch 31, 2022 and 2021 were$1.5 million and$1.4 million , respectively.
Autres dépenses, nettes
Les autres dépenses, nettes, comprennent principalement les dépenses de recherche et développement, les ajustements des régimes de retraite à la valeur du marché, les revenus d’intérêts nets, les gains (pertes) de change et les charges de retraite à prestations définies, à l’exclusion des coûts des services.
Les autres charges, nettes, sont restées relativement stables à
Impôts sur le revenu
Impôts sur les bénéfices attribuables aux activités poursuivies au cours du premier trimestre terminé
The difference between theU.S. federal income tax rate of 21.0% and our overall income tax rate for the first quarter was primarily due to income tax expense of$2.2 million for valuation allowances recorded, primarily inChina due to declined profitability. The difference between theU.S. federal income tax rate of 21.0% and our overall income tax rate for the prior-year first quarter was primarily due to income tax expense on unrecognized benefits of$0.3 million .
En général, nous avons pour pratique et intention de réinvestir en permanence les bénéfices de nos filiales étrangères et de ne rapatrier les bénéfices que lorsqu’ils sont fiscalement avantageux.
Résultat des activités poursuivies attribuable aux actionnaires de GCP
[[Image Removed: gcpwi-20220331_g2.jpg]]
La perte des activités poursuivies attribuable aux actionnaires de GCP a été
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Présentation du secteur opérationnel
The following is an overview of the financial performance of the SCC and SBM operating segments for the first quarter compared with the prior-year period. For further information on our accounting policies related to allocating certain functional and corporate costs and measuring segment operating income, please refer to Note 14, "Segments" in the Notes to the unaudited Condensed Consolidated Financial Statements included in Item 1, "Financial Statements" on this Quarterly Report on Form 10-Q. Segment operating margin is defined as segment operating income divided by segment net sales. It represents an operating performance measure related to ongoing earnings and trends in our operating segments that are engaged in revenue generation and other core business activities. We use this metric to allocate resources between the segments and assess our strategic and operating decisions related to core operations of our business.
CSC
[[Image Removed: gcpwi-20220331_g3.jpg]] Net sales were$135.6 million for the first quarter endedMarch 31, 2022 , an increase of$11.7 million or 9.4%, compared with the prior-year quarter. The increase was primarily due to the favorable impact of price increase and volume. SCC had favorable price increases of 6.2% during the first quarter. Gross profit was$37.1 million for the first quarter endedMarch 31, 2022 , a decrease of$8.3 million or 18.3%, compared with the prior-year quarter. Gross margin decreased 920 basis points to 27.4% compared with the prior-year quarter primarily due to historically higher raw material and logistic costs, partially offset by price. 26 --------------------------------------------------------------------------------
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Résultat opérationnel et marge opérationnelle du secteur
[[Image Removed: gcpwi-20220331_g4.jpg]] Segment operating income of$1.3 million for the first quarter endedMarch 31, 2022 decreased$4.8 million , or 78.7%, compared with the prior-year quarter primarily due to lower gross profit. Segment operating margin of 1.0% decreased 390 basis points compared with the prior-year quarter primarily due to higher raw material costs, offset by lower SG&A.
SBM
[[Image Removed: gcpwi-20220331_g5.jpg]] Net sales were$101.7 million for the first quarter endedMarch 31, 2022 , an increase of$2.8 million or 2.8%, compared with the prior-year quarter primarily due to the favorable impact of price increases.North America increased volumes by 8.1%, offset by decreases inAsia Pacific and EMEA. Gross profit was$36.3 million for the first quarter endedMarch 31, 2022 , a decrease of$5.1 million or 12.3%, from the prior-year quarter. Gross margin decreased 620 basis points to 35.7% primarily due to higher raw material costs, partially offset by price increases. 27 --------------------------------------------------------------------------------
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Résultat opérationnel et marge opérationnelle du secteur
[[Image Removed: gcpwi-20220331_g6.jpg]] Segment operating income of$15.8 million for the first quarter endedMarch 31, 2022 decreased by$3.6 million , or 18.6%, compared with the prior-year quarter primarily due to lower gross profit, partially offset by lower SG&A. Segment operating margin decreased 410 basis points to 15.5% primarily due to higher raw material costs.
SITUATION FINANCIÈRE, TRÉSORERIE ET RESSOURCES EN CAPITAL
Voici une analyse de notre situation financière, de nos liquidités et de nos ressources en capital au
Proposed Merger OnDecember 5, 2021 , we entered into the Merger Agreement, with Saint-Gobain. Pursuant to the terms of the Merger Agreement, we are prohibited from certain actions without Saint-Gobain's consent, including the incurrence of debt, capital expenditures above certain thresholds, share repurchases and payment of dividends. Further, we may be required to pay a cash termination fee to Saint-Gobain of up to$71 million , as required under the Merger Agreement under certain circumstances, including in the event GCP terminates the Merger Agreement to enter into a "Superior Proposal," as defined in the Merger Agreement, or in the event GCP enters into an alternative transaction within nine months of termination of the Merger Agreement in certain circumstances and such alternative transaction is consummated.
Trésorerie et facilités de crédit disponibles
AtMarch 31, 2022 we had$471.3 million in cash and cash equivalents of which$323.2 million was held in theU.S. We had additional available liquidity of$347.2 million under theU.S. revolving line agreement and$41.1 million was available under various non-U.S. credit facilities. We expect to meet ourU.S. cash and liquidity requirements with cash on hand, cash we expect to generate during 2022 and thereafter, future borrowings, if any, and other available liquidity, including royalties and service fees from our foreign subsidiaries. We may also repatriate future earnings from foreign subsidiaries if that results in minimal or noU.S. tax consequences. We expect to have sufficient cash and liquidity to finance ourU.S. operations and growth strategy and meet our debt obligations. Our non-U.S. credit facilities are extended to various subsidiaries that use them primarily to issue bank guarantees supporting trade activity and provide working capital during occasional cash shortfalls in certain foreign entities. We generally renew these credit facilities as they expire. 28 --------------------------------------------------------------------------------
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Analyse des flux de trésorerie
Le tableau suivant résume nos flux de trésorerie pour le premier trimestre terminé
Three Months Ended
March 31,
2022 2021
(in millions)
Flux de trésorerie (utilisés dans) fournis par les activités poursuivies
Operating activities$ (16.0) $ 0.7 Investing activities (12.5) (8.1) Financing activities - 0.6 Effect of exchange rate changes on cash (0.8)
(3.0)
Change in cash and cash equivalents (29.3)
(9.8)
Cash and cash equivalents, beginning of period 500.6
482.7
Cash and cash equivalents, end of period$ 471.3
Cash flows from operating activities. As shown in the table below, our cash flows provided by operating activities from continuing operations decreased by$16.7 million Three Months Ended March 31, 2022 2021 (in millions) Collections from customers$ 231.3 $ 230.3 Other disbursements, other than interest and income tax payments (246.8) (228.4) Income tax payments, net (0.5) (1.2)
Trésorerie (utilisée dans) fournie par les activités d’exploitation des activités poursuivies
$ (16.0) $ 0.7 For the first quarter endedMarch 31, 2022 , our collection from customers increased$1.0 million due to higher days sales outstanding. The increase in disbursements, other than interest and income tax payments of$18.4 million was due mostly to increase in raw material and logistic costs. Cash flows from investing activities. Net cash used by investing activities from continuing operations during the first quarter was$12.5 million compared to$8.1 million during the prior-year quarter. Cash flows from financing activities. There was no cash provided by financing activities during the first quarter compared to$0.6 million during the prior-year quarter. The period-over-period change was primarily due to higher tax withholding obligations related to employee equity awards and payments for finance lease obligations, partially offset by proceeds received from the exercise of stock options.
Régimes de retraite à prestations déterminées
Based on theU.S. advance-funded plans' status during the first quarter and the prior-year period, there were no minimum required payments under ERISA. We made contributions of$0.1 million and$0.3 million , respectively, to theU.S. and non-U.S. pension plans during the first quarter and endedMarch 31, 2022 , respectively. We intend to fund non-U.S. pension plans based upon applicable legal requirements, as well as actuarial and trustee recommendations. 29 --------------------------------------------------------------------------------
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Dette
Total debt outstanding atMarch 31, 2022 was$349.3 million . Our debt service requirements are expected to be funded through our existing sources of liquidity and operating cash flows. Subject to certain conditions stated in the Indenture, we may, at our option and at any time and from time to time, redeem the 5.5% Senior Notes prior to their maturity date in whole or in part at certain redemption prices, as discussed in Note 6, "Debt", in the Notes to the Consolidated Financial Statements included in Item 8, "Financial Statements and Supplementary Data" of the 2021 Annual Report on Form 10-K. For further information on our 5.5% Senior Notes and Credit Agreement, please refer to Note 4, "Debt" in the Notes to the unaudited Condensed Consolidated Financial Statements included in Item 1, "Financial Statements" on this Quarterly Report on Form 10-Q.
Autres obligations contractuelles et éventualités
We have various future contractual obligations, including those for debt and related interest payments, pension funding requirements, operating leases and other operating commitments. Please refer to Note 12, "Commitments and Contingencies", in the Notes to the unaudited Condensed Consolidated Financial Statements included in Item 1, "Financial Statements" of this Quarterly Report on Form 10-Q for a discussion of financial assurances and other contingencies.
MÉTHODES ET ESTIMATIONS COMPTABLES CRITIQUES
For information on our significant accounting policies and estimates, please refer to the Notes to our audited Consolidated Financial Statements included in Item 8, "Financial Statements and Supplementary Data" of our 2021 Annual Report on Form 10-K for the year endedDecember 31, 2021 . 30 --------------------------------------------------------------------------------
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