PR Newswire | Dec 14, 2021 06:01AM EST

12/14 05:00 CST

Perimeter Solutions Reports Third Quarter 2021 ResultsListed on The New York Stock Exchange under the symbol "PRM" on November 9, 2021Double-digit revenue and Adjusted EBITDA growth in the Fire Safety segment, both in Q3 and year-to-date$100M Share repurchase program authorized CLAYTON, Miss., Dec. 14, 2021

CLAYTON, Miss., Dec. 14, 2021 /PRNewswire/ -- Perimeter Solutions, SA (NYSE: PRM) ("Perimeter" or the "Company"), a global solutions provider for the fire safety and oil additives industries, today reported financial results for its third quarter ended September 30, 2021.

"We are delighted to share our first financial results as a public company," said CEO Edward Goldberg. "Our revenue and Adjusted EBITDA grew double digits, in Fire Safety, in both the third quarter and year-to-date periods. Most importantly, we delivered on our commitment to support our customers efforts, 100% of the time, to save lives, property, and the environment. In addition, we successfully qualified and launched Phos-Chek Fortify, our new durable retardant product designed for the Prevention and Protection market. We believe Fortify is a game changer, providing season long protection for both fire prevention and fire protection." Mr. Goldberg added "Oil Additives Adjusted EBITDA declined in the third quarter, primarily due to higher material and transportation costs during the period. We fully expect to pass through these costs, with margin recovery already underway in the fourth quarter, and our expectations for the segment unchanged."

Third Quarter 2021 Results

* Net sales increased 12% to $195.4 million during the third quarter, as compared to $174.3 million in the prior-year quarter. * Fire Safety sales increased 14% to $172.4 million, as compared to $151.1 million in the prior year. * Oil Additives sales decreased 1% to $23.0 million, as compared to $23.2 million in the prior year.

* Net income during the third quarter was $52.0 million, or $0.98 per share, a decline of $0.6 million from $52.6 million, or $0.99 per share, for the same period of 2020. * Adjusted EBITDA increased 9% to $100.4 million during the third quarter, as compared to $92.2 million in the prior-year quarter. * Fire Safety Adjusted EBITDA increased 13% to $97.9 million, as compared to $86.6 million in the prior year. * Oil Additives Adjusted EBITDA decreased 55% to $2.5 million, as compared to $5.6 million in the prior year.

Year-to-Date Results

* Net sales increased 12% to $316.5 million during the year-to-date period, as compared to $283.8 million in the prior-year period. * Fire Safety sales increased 11% to $237.3 million, as compared to $213.9 million in the prior year. * Oil Additives sales increased 13% to $79.2 million, as compared to $69.8 million in the prior year.

* Net income during the year-to-date period was $29.6 million, or $0.56 per share, a decline of $0.9 million from $30.5 million, or $0.58 per share, for the same period of 2020. * Adjusted EBITDA increased 12% to $134.6 million during the year-to-date period, as compared to $120.0 million in the prior-year period. * Fire Safety Adjusted EBITDA increased 13% to $116.7 million, as compared to $102.8 million in the prior year. * Oil Additives Adjusted EBITDA increased 4% to $17.9 million, as compared to $17.2 million in the prior year.

Conference Call and Webcast

Perimeter management will hold a conference call at 8:30 a.m. EDT on Tuesday, December 14, 2021 to discuss third quarter 2021 operating results. The conference call can be accessed by dialing (877) 407-9764 (toll-free) or (201) 689-8551 (toll).

The conference call will also be webcast simultaneously on Perimeter's website ( https://www.perimeter-solutions.com/en/), accessed under the Investor Relations link. The webcast link will be made available on the Company's website prior to the start of the call within the News & Events section of the Investor Relations website.

A slide presentation will also be available for reference during the conference call; go to the investor relations page of our website to the News & Events menu and click on "Events & Presentations."

Following the live webcast, a replay will be available on the Company's website. A telephonic replay will also be available approximately two hours after the call and can be accessed by dialing (877) 660-6853 (toll-free) or (201) 612-7415 (toll). The telephonic replay will be available until January 13, 2022.

About Perimeter

Perimeter is a leading global solutions provider for the fire safety and oil additives industries. The Fire Safety business is a formulator and manufacturer of fire management products that help our customers combat various types of fires, including wildland, structural, flammable liquids and other types of fires. Our Fire Safety business also offers specialized equipment and services, typically in conjunction with our fire management products, to support our customers' firefighting operations. Our specialized equipment includes airbase retardant storage, mixing, and delivery equipment; mobile retardant bases; retardant ground application units; mobile foam equipment; and equipment that we custom design and manufacture to meet specific customer needs. Our service network can meet the emergency resupply needs of over 150 air tanker bases in North America, as well as many other customer locations in North America and internationally. The segment is built on the premise of superior technology, exceptional responsiveness to our customers' needs, and a "never-fail" service network. The segment sells products to government agencies and commercial customers around the world. Our wildfire retardant products are the only qualified products for use by the USDA Forest Service.

Perimeter's Oil Additives business provides high quality P2S5 primarily used in the preparation of ZDDP-based lubricant additives for critical engine anti-wear solutions. P2S5 is also used in pesticide and mining chemicals applications.

Forward-lookingInformation

Certain statements contained in this news release, as well as other information provided from time to time by Perimeter Solutions, SA. or its employees, may contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Forward-looking statements give Perimeter's current expectations and projections relating to the Company's financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as "anticipate," "estimate," "expect," "forecast," "project," "plan," "intend," "believe," "confident," "may," "should," "can have," "likely," "future," "optimistic" and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events.

Any such forward-looking statements are not guarantees of performance or results, and involve risks, uncertainties (some of which are beyond the Company's control) and assumptions. Although Perimeter believes any forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect Perimeter's actual financial results and cause them to differ materially from those anticipated in any forward-looking statements, including the risk factors discussed within the Risk Factors section of the Form 10-Q for the period ended September 30, 2021. Stockholders, potential investors and other readers should consider these factors carefully in evaluating the forward-looking statements.

Should one or more of the risk factors or uncertainties materialize, Perimeter's actual results may vary in material respects from those projected in any forward-looking statements. In the current environment, some of the risk factors have materialized and may or will continue to be impacted by the COVID-19 pandemic, which may cause actual results to vary from these forward-looking statements.

Any forward-looking statement made by Perimeter in this press release speaks only as of the date on which it is made. Perimeter undertakes no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

SOURCE: Perimeter Solutions, SA.

CONTACT:ir@perimeter-solutions.com

SK INVICTUS INTERMEDIATE, S. ? R.L. AND SUBSIDIARIESCondensed Consolidated Statement of Income and Comprehensive Income

(in thousands, except share and per share data)

Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

(unaudited) (unaudited)

Net sales $ $ $ $ 195,414 174,259 316,460 283,758

Cost of goods sold 86,081 76,264 159,895 145,704

Gross profit 109,333 97,995 156,565 138,054

Operating expenses:

Selling, general, and 15,333 8,845 42,544 26,579administrative

Amortization expense 13,276 12,836 39,818 38,264

Other operating expense 313 360 1,066 1,051

Total operating expenses 28,922 22,041 83,428 65,894

Operating income 80,411 75,954 73,137 72,160

Other expense:

Interest expense-net 8,065 9,244 23,951 33,494

Loss on contingent earnout - - 2,763 -

Unrealized foreign currency 1,634 (2,615) 3,892 (2,768)(gain) loss

Other (income) expense-net 66 (271) (252) (351)

Total other expenses, net 9,765 6,358 30,354 30,375

Income before income taxes 70,646 69,596 42,783 41,785

Income tax expense (18,637) (16,966) (13,151) (11,242)

Net income 52,009 52,630 29,632 30,543

Other comprehensive income:

Foreign translation adjustments (2,020) 2,209 (2,424) (1,234)

Total comprehensive income $ $ $ $ 49,989 54,839 27,208 29,309

Net income per share:

Basic $ $ $ $ 0.98 0.99 0.56 0.58

Diluted $ $ $ $ 0.98 0.99 0.56 0.58

Weighted-average shares used incomputing net income per share:

Basic 53,045,510 53,045,510 53,045,510 53,045,510

Diluted 53,045,510 53,045,510 53,045,510 53,045,510

SK INVICTUS INTERMEDIATE, S. ? R.L. AND SUBSIDIARIESCondensed Consolidated Balance Sheets(in thousands, except share and per share data)

As of As of September 30, December 31, 2021 2020

(unaudited)

Assets

Current assets:

Cash and cash equivalents $ $ 39,581 22,478

Accounts receivable, net of allowance fordoubtful accountsof $987 and $1,044 as of September 30, 2021 97,107 28,896andDecember 31, 2020, respectively

Inventories ^(1) 64,792 58,784

Income tax receivable - 11,457

Prepaid expenses and other current assets 7,973 11,406

Total current assets 209,453 133,021

Property, plant, and equipment-net 48,496 48,235

Goodwill 486,375 482,041

Customer lists-net 271,390 304,308

Existing technology and patents-net 126,967 135,928

Other intangible assets-net 33,232 33,464

Other assets 863 1,209

Total assets $ $ 1,176,776 1,138,206

Liabilities and Shareholders' Equity

Current liabilities:

Current portion of long-term debt, net of $ $ unamortized debt issuance costs 5,610 6,723

Accounts payable 22,840 9,869

Deferred revenue 1,117 286

Accrued expenses and other current 21,296 16,045liabilities

Total current liabilities 50,863 32,923

Long-term debt, less current portion, net of 679,540 680,548unamortized debt issuance costs

Deferred income taxes 106,792 112,162

Other liabilities 20,951 21,151

Total liabilities $ $ 858,146 846,784

Commitments and contingencies

Shareholders' equity:

Common stock, $1 par value per share;53,045,510 sharesauthorized as of September 30, 2021 andDecember 31, 53,046 53,0462020; 53,045,510 shares issued andoutstanding as ofSeptember 30, 2021 and December 31, 2020

Additional paid-in capital 289,344 289,344

Accumulated other comprehensive loss (5,598) (3,174)

Accumulated deficit (18,162) (47,794)

Total shareholders' equity 318,630 291,422

Total liabilities and shareholders' equity $ $ 1,176,776 1,138,206

^ Amounts include $542 and $2,505 of inventory purchased from the former(1) owners of the original Invictus business as of September 30, 2021 and December 31, 2020, respectively.

SK INVICTUS INTERMEDIATE, S. ? R.L. AND SUBSIDIARIESCondensed Consolidated Statements of Cash Flows(in thousands)

As of As of September 30, September 30, 2021 2020

(unaudited)

Cash flows from operating activities:

Net income $ $ 29,632 30,543

Adjustments to reconcile net income to netcash provided by (used in) operatingactivities:

Depreciation and amortization expense 45,593 43,371

Deferred income taxes (5,195) (6,884)

Amortization of deferred financing costs 2,432 2,649

Loss on contingent earnout 2,763 -

Changes in operating assets and liabilities,net of acquisitions:

Accounts receivable (68,211) (65,763)

Inventories (5,554) 15,529

Income tax receivable 11,457 6,528

Prepaid expenses and other current assets 3,104 (2,490)

Other assets 346 592

Accounts payable, 12,971 (1,613)

Deferred revenue 831 831

Accrued expenses and other current liabilities 2,448 7,831

Other liabilities (200) 576

Net cash provided by operating activities 32,417 31,700

Cash flows from investing activities:

Purchase of property and equipment (5,149) (5,695)

Purchase of businesses, net of cash acquired (7,464) (1,970)

Net cash used in investing activities (12,613) (7,665)

Cash flows from financing activities:

Proceeds from revolving credit facility 19,500 72,100

Repayments of revolving credit facility (19,500) (93,700)

Repayment of long-term debt (4,211) (4,208)

Net cash used in financing activities (4,211) (25,808)

Effect of foreign currency on cash and cash 1,510 (3,381)equivalents

Net change in cash and cash equivalents 17,103 (5,154)

Cash and cash equivalents at the beginning of 22,478 9,822year

Cash and cash equivalents at the end of year $ $ 39,581 4,668

Supplemental disclosures of cash flowinformation:

Cash paid for interest $ $ 21,502 37,877

Cash paid for income taxes 7,092 4,885

Non-GAAP Financial Metrics

Adjusted EBITDA

The computation of adjusted EBITDA is defined as net income plus income tax expense, net interest and other financing expenses, and depreciation and amortization, adjusted on a consistent basis for certain non-recurring, unusual or non-operational items in a balanced manner and on a segment basis. These items may include operational restructuring charges, unrealized loss (gain) on foreign currency translation, loss on contingent earnout, deferred future payments, and other non-recurring or non-operational items. Management fees also are excluded from the Company's calculation of adjusted EBITDA as these fees relate to the services provided by SK Capital Partners IV-A, L.P. and SK Capital Partners IV-B, L.P (collectively, the "Sponsor") when acting in a management capacity on strategic and other non-operational matters and do not represent expenses incurred in the normal course of our operations. Adjusted EBITDA margin is defined as adjusted EBITDA divided by sales. To supplement the Company's condensed consolidated financial statements presented in accordance with U.S. GAAP, Perimeter provides a summary to show the computation of adjusted EBITDA, and reconciliation to net income, taking into account certain charges and gains that were recognized during the periods presented.

Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Net income $ $ $ $ 52,009 52,630 29,632 30,543

Income tax expense 18,637 16,966 13,151 11,242

Depreciation and 15,212 14,592 45,593 43,371amortization

Interest and financing 8,065 9,244 23,951 33,494expense

Restructuring charges ^(a) 3,855 445 12,805 690

Loss on contingent earnout - - 2,763 -^(b)

Management fees ^(c) 313 344 937 969

Deferred future payments ^ 625 625 1,875 2,500(d)

Unrealized foreigncurrency (gain) 1,634 (2,615) 3,892 (2,768)loss

Adjusted EBITDA $ $ $ $ 100,350 92,231 134,599 120,041

Net Sales $ $ $ $ 195,414 174,259 316,460 283,758

Adjusted EBITDA margin 51% 53% 43% 42%

^(a) Adjustment to reflect non-recurring expenses incurred related to business combination with Perimeter Solutions.

^(b) Adjustment to reflect changes in contingent consideration to prior owners of LaderaTech, an acquired business in 2020.

Adjustment to reflect fees pertaining to services provided by SK Capital^(c) Partners IV-A, L.P. and SK Capital Partners IV-B, L.P (collectively, the "Sponsor") when acting in a management capacity on strategic and other non-operational matters which do not represent expenses incurred in the normal course of our operations.

^(d) Adjustment to reflect deferred compensation resulting from the Ironman Acquisition in 2019.

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SOURCE Perimeter Solutions