TRG | The Bottom Line – 10/13

Worthington Industries this past week hosted an investor and analyst Day in New York City where future senior leaders representing Worthington Enterprises and Worthington Steel provided an in-depth review of their strategies to drive long-term growth and shareholder value. TRG joined the Worthington Enterprises portion of the day. Not unlike the light being shown on Core & Main’s (CNM) niche business model (CNM was previously the Waterworks division of HDSupply), the Worthington Enterprises investor day highlighted the power of a differentiated business model well positioned to benefit from key secular tailwinds. Worthington Enterprises is a market-leading designer and manufacturer of innovative building products, consumer products, and sustainable energy solutions. This is a high margin, asset-light business model, generating strong cash flow and returns. Post spin, the company should be well positioned financially to continue growth – debt to EBITDA targeted to 1x and free cash conversion 85%+. Through innovative JVs with Armstrong World (AWI) for ceiling grid to developing world-leading developer and manufacturer of products supporting the global, growing hydrogen ecosystem (a more practical solution for long-haul trucking vs. heavy electric vehicle solutions), Worthington Enterprises brings to the investing community a unique business model that checks many boxes in light of the realities of the current market.