Myers Industries announces consolidations and closures as part of second quarter report

Akron, OH – Myers Industries Inc. announced results for the second quarter ended June 30, 2024.

Myers Industries President and CEO Mike McGaugh commented, “Our second-quarter results reflect the Company’s first full quarter with Signature Systems. This business is benefiting from worldwide investments in Infrastructure and helped drive both sequential and year-over-year revenue growth and margin expansion. Signature’s performance outpaced the demand headwinds in the Recreational Vehicle (RV), Marine, and Automotive Aftermarket end markets.”

“We continue to focus on growing our Storage, Handling & Protection portfolio, most notably our four power brands: Akro-Mils, Buckhorn, Scepter, and Signature Systems. We believe our increased participation in the Military and Infrastructure end markets will provide meaningful growth for our Company over the next several years.

At the same time, we are taking actions to reduce costs and increase productivity in the Engineered Solutions and Automotive Aftermarket portfolios. These actions include the consolidation of three distribution centers in our Myers Tire Supply business, as well as today’s announcement of the consolidation of our Atlantic, Iowa, rotational molding facility into our other rotational molding plants in Indiana. We are able to reduce our footprint and reduce our cost structure, due to the productivity gains we’ve achieved. We expect these closures to be completed in 2025 and deliver approximately $5 million in cost savings in 2025 as well.

Our ongoing productivity-improvement and cost-reduction initiatives will help us navigate the cyclical demand conditions in the RV, Marine, and Automotive Aftermarket end markets while positioning the Company favorably for when these conditions revert to historical levels of demand.”

McGaugh concluded, “As a result of continued trough-like demand conditions in these end markets, we believe it is prudent to lower our full-year adjusted earnings per share guidance to a range of $1.05 to $1.20.

Myers’ consistent and disciplined execution of our Three-Horizon strategy and the expansion of our portfolio of branded products enabled us to achieve the highest quarterly adjusted EBITDA margin of the past decade. Despite the near-term demand softness in select end markets, we remain excited about the ongoing transformation of Myers Industries as we execute against our long-term strategy to build a portfolio of businesses with high margin, branded products that Move, Store, and Protect.”

Net sales were $220.2 million, an increase of $11.8 million, or 5.7%, compared with $208.5 million for the second quarter of 2023. The increase in net sales was driven by contributions from the recent acquisition of Signature Systems, partially offset by lower pricing and volumes in both the Material Handling and Distribution segments.

Gross profit increased $7.1 million, or 10.4%, to $75.5 million, driven by performance at Signature Systems, favorable product mix and lower material costs, partially offset by lower pricing and volume, as well as adjusting items related to acquisition and restructuring expenses. Gross margin improved 150 basis points to 34.3% compared with 32.8% for the second quarter of 2023. On an adjusted basis, gross profit increased 320 basis points to 36.1% from 32.9%. Selling, general and administrative expenses decreased $0.7 million year-over-year, or 1.3%, to $51.7 million. SG&A as a percentage of sales decreased to 23.5%, compared with 25.8% in the first quarter of 2024 and 25.1% in the same period last year, driven in part by lower incentive compensation accruals, reflecting Myers’ full-year outlook and cost-saving initiatives. Net income per diluted share was $0.28, compared with $0.29 for the second quarter of 2023. Adjusted earnings per diluted share were $0.39, compared with $0.35 for the second quarter of 2023.