jeld-wen inaugural investor day
TRANSCRIPT
© 2021 JELD-WEN | Investor Day
Forward-Looking Statements
This presentation contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements include statements regarding our business strategies and ability to execute on our plans, market potential and growth opportunities, future financial
performance, shareholder value, customer demand, the potential of our categories, brands and innovations, the impact of our footprint rationalization and
modernization program, our pipeline of productivity projects, our targets and outlook for future periods, and our expectations, beliefs, plans, objectives, prospects,
assumptions, or other future events. Forward-looking statements are generally identified by our use of forward-looking terminology such as “anticipate”, “believe”,
“continue”, “could”, “estimate”, “expect”, “intend”, “may”, “might”, “plan”, “potential”, “predict”, “seek”, or “should”, or the negative thereof or other variations thereon
or comparable terminology. Where, in any forward-looking statement, we express an expectation or belief as to future results or events, such expectation or belief is
based on the current plans, expectations, assumptions, estimates, and projections of our management. Although we believe that these statements are based on
reasonable expectations, assumptions, estimates and projections, they are only predictions and involve known and unknown risks, many of which are beyond our
control that could cause actual outcomes and results to be materially different from those indicated in such statements. Risks and uncertainties that could cause
actual results to differ materially from such statements include risks associated with the impact of the COVID-19 pandemic on the company and our employees,
customers and suppliers, and other factors, including the factors discussed in our Annual Reports on Form 10-K and our other filings filed with the Securities and
Exchange Commission. The forward-looking statements included in this presentation are made as of the date hereof, and except as required by law, we undertake
no obligation to update, amend or clarify any forward-looking statements to reflect events, new information or circumstances occurring after the date of this
presentation.
Non-GAAP Disclosure
This presentation presents certain “non-GAAP” financial measures. The components of these non-GAAP measures are computed by using amounts that are
determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”). A reconcilia tion of non-GAAP financial measures
used in this presentation to their nearest comparable GAAP financial measures is included at the end of this presentation.
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© 2021 JELD-WEN | Investor Day
A Compelling Investment Opportunity
Gary S. Michel | President and CEO
A Sustainable Competitive Advantage - JEM
Gregg Miner | SVP Global JEM
Multi-faceted Growth Opportunities in North America
Daniel Castillo | EVP and President, North America
JELD-WEN Accelerated Growth (JAG)
Shawn Laskoski | SVP Corporate Strategy and Business Development
Multi-faceted Growth Opportunities in Europe
David Guernsey | EVP and President, Europe
Our ESG Ambition
Roya Behnia | EVP, General Counsel and CCO
Delivering Exceptional Shareholder Returns
John Linker | EVP and CFO
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Video: JELD-WEN Excellence Model (JEM)
Video: Improving Cycle Time and Productivity Through JEM
Q&A Session
Video: Accelerating Growth Through JEM
Q&A Session
© 2021 JELD-WEN | Investor Day
A Compelling
Investment
Opportunity
4
Gary S. MichelPresident and CEO
© 2021 JELD-WEN | Investor Day
A Compelling Investment Opportunity
5
Multi-faceted
GROWTH
STRATEGY
ō
Proven
STRATEGY
and BUSINESS
OPERATING
SYSTEM
WORLD-CLASS
FRANCHISE
with BREADTH
and SCALE
© 2021 JELD-WEN | Investor Day 6
JELD-WEN EXCELLENCE MODEL
Accelerate
Organic Growth
Operational
Excellence and
Margin Expansion
Cash Flow
and Disciplined
Capital Allocation
Premier Performing
Culture
World-Class Financial Performance and Shareholder Returns
Strategic Growth Drivers Delivering Results
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MARKET LEADER | STRONG BRANDS | UNRIVALED PRODUCT BREADTH | GLOBAL OPERATING PLATFORM
© 2021 JELD-WEN | Investor Day
Values-Driven
Culture Based on
Our Deep Roots…
As one global team, we:
BUILD businesses ethically and safely
INVEST in people
INSPIRE customers through innovation
DELIVER on our promises
IMPROVE every day
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…and the foundation of our future.
© 2021 JELD-WEN | Investor Day
Doors65% Windows
20%
Ancillary15%
2020
Revenue
~$4.2B
Strong Brands with Broad Product Offering
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RESIDENTIAL
INTERIOR DOORS
• Molded and flush
• Wood veneer and glass
• Stile and rail doors
• Value added services
RESIDENTIAL
EXTERIOR DOORS
• Wood veneer, Fiberglass, and Steel
• Patio doors
• Folding and sliding wall systems
• Value added services
COMMERCIAL
DOORS
• Wood
• Steel
• MDF
• Fire rated
RESIDENTIAL
WINDOWS
• Wood
• Vinyl
• Aluminum
ANCILLARY
PRODUCTS
• Shower enclosures
• Closet systems
• Molding and trim boards
PORTFOLIO OF TRUSTED BRANDS BREADTH OF PRODUCT OFFERING
© 2021 JELD-WEN | Investor Day
$4.2B
Profile of a Global Leader
2015 - 2020 Adj.EBITDA CAGR
80 bpsRevenue from North America Segment
Revenue from Stable Repair and Renovation Market
4.6% 50%
60%2020 Adj. EBITDA Margin Expansion
2015 - 2020 Revenue CAGR
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7.5%
2020 Net Revenue
Global leader in windows and doors operating in
North America, Europe and Australasia#1
© 2021 JELD-WEN | Investor Day
Aspiring to be a
“Great Company”
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CUSTOMERS want to BUY from
Where PEOPLE want to WORK
SHAREHOLDERS want to INVEST in
Doing the RIGHT THING for PEOPLE,
our COMMUNITIES, and the WORLD
© 2021 JELD-WEN | Investor Day
Proven Experience and
Thought Leaders in:
Strategy
Growth
Operational Excellence
Lean
Diversity, Equity
and Inclusion
Sustainability
Mergers and Acquisitions
Delivering Results
Experienced Leadership Team Delivering Results
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GARY MICHEL
President and Chief
Executive Officer
JOHN LINKER
Executive Vice President and
Chief Financial Officer
ROYA BEHNIA
Executive Vice President,
General Counsel and Chief
Compliance Officer
TIM CRAVEN
Executive Vice President,
Human Resources
DANIEL CASTILLO
Executive Vice President and
President, North America
PETER FARMAKIS
Executive Vice President and
President, Australasia
DAVID GUERNSEY
Executive Vice President
and President, Europe
MARK DIXON
Senior Vice President,
Global Procurement
SHAW N LASKOSKI
Senior Vice President,
Corporate Strategy and Business
Development
KEVIN LILLY
Senior Vice President,
Chief Information Officer
GREGG MINER
Senior Vice President,
Global JEM Leader
JEM Enables Growth and Margin Expansion
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JEM Delivers Multiple Growth Levers
EVOLUTION OF LEAN CULTURE
LEADINGStrategy and
Growth Focus
Leadership and
Growth Excellence
LIVING System FocusCommercial and
Operational Excellence
DOING Tool FocusContinuous Improvement
Culture
© 2021 JELD-WEN | Investor Day
© 2021 JELD-WEN | Investor Day 13
Universal (“U”) Strategy for Growth
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PREMIUM MATERIALS FOR
HIGH-PERFORMANCE
EXTERIOR & INTERIOR
BUILDING PRODUCTS
CUSTOMER
EXPERIENCE
CONSTRUCTION
INDUSTRY
PRODUCTIVITY
INNOVATION AND SUSTAINABILITY
Universally applied strategy – across all customer segments,
all regions, all offerings, and all brands
© 2021 JELD-WEN | Investor Day
Reliably Boring, Relentlessly Repeatable
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RELENTLESSLY REPEATABLE “THE WHAT”
• Differentiated, superior customer experience
• Deliver results
• Drive growth
RELIABLY BORING “THE HOW”
• Say-do culture
• Field the best team
• JEM
• ESG
© 2021 JELD-WEN | Investor Day
ORGANIC REVENUE
CAGR 2021 -2025
Above market
= 6% to 8%
2025 ADJUSTED
EBITDA MARGIN
15% to 17%
FREE CASH FLOW
CONVERSION 2021 -2025
90% to 100%of adjusted net income
CAPITAL ALLOCATION
2021-2025
~$4 billionof M&A capacity(1);
share repurchase
as alternative
Multi-faceted growth platform will deliver growth, margin expansion,
and compounding cash flow through disciplined capital allocation
High Visibility to Achieving 2025 Targets
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© 2021 JELD-WEN | Investor Day
ESG Strategy Aligned
with Core Values
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• Sustainable supply chain and circular economy
• Energy efficient product portfolios
• Innovation and research
• Diversity, equity and inclusion
• Health and safety
• Transparency and governance
Building on our legacy and delivering value for all stakeholders
© 2021 JELD-WEN | Investor Day
THE JELD-WEN EXCELLENCE MODEL
A Sustainable
Competitive
Advantage
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Gregg MinerSenior Vice President, Global JEM Leader
© 2021 JELD-WEN | Investor Day
JEM DP
VSA
RIESQDCI
MDI
Strat Dep.
Accelerate positive momentum with structured transformation model
Transformation
Model Blueprint
JELD-WEN Excellence Model (JEM)
S U S T A I N A B L E C O M P E T I T I V E A D V A N T A G E
OPERATIONAL EXCELLENCELEADERSHIP AND GROWTH
EXCELLENCE
Six Sigma/Variation
Reduction
Integrated Business
PlanningGoal Deployment
Talent Dev. and
Acquisition
Supply Chain/Material
ProcessesERP Strategic Planning Lean Leadership
ACHIEVE CONTINUOUS IMPROVEMENT CULTURE
Changeover Reduction
(SMED)/TPM
Poka Yoke/Quality At
The Source
Commercial
ExcellenceInnovation Excellence
Manufacturing System
DesignPull/Kanban/Flow
Segmentation and Value
Propositions
Product/Process Dev.
and Validation
Model CellStandard Work w/
Layered Process AuditRACI: Accountability
Project/Diagonal
Management
Gemba Walks5s Workplace
Organization
Transaction Process
ImprovementChange Management
Visual Management: SQDCI and Hour X Hour Boards KaizenValue Stream/
Process Mapping
B A S I C P R O B L E M S O L V I N G ( I N C L U D I N G A 3 )
V O I C E O F C U S T O M E R
E N V I R O N M E N T A L , H E A L T H a n d S A F E T Y
Doing Living Leading
Creating a Sustainable Competitive Advantage
Act
Plan
Do
Check
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© 2021 JELD-WEN | Investor Day 19
JEM delivers growth, productivity savings and cash conversion
• Sustained differentiated
performance in:
• Cycle time
• Throughput capacity
and growth
• Productivity
• Cash conversion
• End to end value stream mapping
• 14 model plants globally
• Hundreds of lean training activities monthly
• Four new global leaders with 100+ years of collective
experience
• Real time problem solving with daily management
• SQDCI for systemic problem solving
• Accelerating productivity savings
Doing JEM Living JEM Leading JEM
• 80 JEM resources across the
globe
• Hundreds of discrete kaizens
• Basic problem solving via
SQDCI
• Demonstrated productivity
savings
Creating a Premier Performance Culture
RESULTS-DRIVEN BEHAVIOR TO BEHAVIOR-DRIVEN RESULTS
BeliefsValuesHabitsActions
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© 2021 JELD-WEN | Investor Day
Waste Reduction Accelerates Customer Value Delivery
Focus on adding value to the customer – while accelerating growth, margin and cash
JEM – Focus On Value To Deliver Growth
VelocityValue StreamValue
V3
Order
to
Ship
Quote
to
Cash
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© 2021 JELD-WEN | Investor Day
Projects
Just Do Its
Week-long Rapid
Improvement Events
Cultural Transformation
Workshops
Transformation Team
Development
Full Value Stream Analysis
14 Strategic Value Streams Under Transformation
Results
Rapid improvements in less than 30 days
Minimal capital investment required
Actions
Proactive and forward looking
Focused on removing waste, increasing velocity
and delivering value
Detailed Plans in the Model Sites
Each site has customer-centric value streams focus
Creates a body of work to achieve future state
JEM – Building a Model for Long-Term Success
Model Sites
Across Regions
14
3
50%
Lead Time Reduction
2x Productivity
20%
Quality
Improvement
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© 2021 JELD-WEN | Investor Day
1 2 3 4 5 6 7 8 9 10 11 12 13
W E E K S
Improved Special Order Lead Time
in North American Door Facility
Lead Time Days Units/Day
Focus on
Velocity
96% Lead Time
Reduction
3x Higher
Throughput
Velocity Driven Growth
22
Increasing capacity with minimal capital investment
© 2021 JELD-WEN | Investor Day
JEM tools and behaviors permeating the entire enterprise
JEM Beyond the Factory Floor
New Employee
Technology:
Hiring and
Recruiting:
Accounting
and Finance:
• Closing Process
• 20% reduction in touch
time (productivity)
• 90% reduction in
weekend work (respect
for every individual)
• Process implemented in North
America – Expanding to
Europe and Australasia
• 18% reduction in Time To Fill
• 50% reduction in approvals
• 33% reduction in cycle time
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© 2021 JELD-WEN | Investor Day
$159
$170
2019 2021 (F)
Footprint rationalization and modernization program driving cost savings,
improved cycle time, enhanced quality, and improved productivity
$100M Savings Target From
Footprint Rationalization Revenue Per Square Foot
Complete
Planning
In Progress
Footprint Rationalization and Modernization
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© 2021 JELD-WEN | Investor Day
Multi-faceted
Growth Opportunities
in North America
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Daniel CastilloExecutive Vice President and President, North America
© 2021 JELD-WEN | Investor Day
End Market Channel Product
Leading doors and windows solutions
Overview
• $2.5B consolidated doors and windows provider in North America
• Strong brand and industry leading market positions in key products
• Multi-faceted growth opportunities
Windows and Doors Leader
in North America
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Residential New Construction
Repair and Renovation
Non-Residential
Doors
Windows
Value-Added Distribution
Other
Distributors
Retail/Home Center
2 0 2 0 R E V E N U E
© 2021 JELD-WEN | Investor Day
Service level improvements yield significant growth opportunity
Competition JELD-WEN
L E A D T I M E
Vinyl Windows
• Best in class talent utilizes JEM to create a winning culture
• Lead time reduction fuels double digit growth rates
• Productivity improves service levels and expands capacity
Prior Current
O R D E R S
Entry Doors
Competition JELD-WEN
L E A D T I M E
Prior Current
O R D E R S
Lead Time Reduction Supports Growth
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© 2021 JELD-WEN | Investor Day
Executing interior molded door cycle time reduction increases production
and supports increased demand to deliver revenue growth…
• ELIMINATING waste through
advanced problem-solving
• DRIVES productivity and increased
throughput
• IMPROVED manufacturing
efficiency by 5 seconds yields up to
5% revenue growth across entire NA
interior molded door footprint
JEM fuels growth opportunities
“Appreciate our strategic business
partners taking care of us during so
much market uncertainty!”
– STRATEGIC TRADITIONAL
CHANNEL CUSTOMER
“Best in Class service management
through COVID environment.”
– MAJOR RETAILER
Increased Velocity Drives Growth
28
“
© 2021 JELD-WEN | Investor Day
Significant growth opportunities in all channels
Capacity Expansion Enables Growth
29
• Expanding window capacity through
automation
• Rebalancing capacity to high growth
markets
• Investing in product innovation
Multi-Family Windows Single Family Windows
• Productivity and Capital investments
increase unit capacity ~50% by 2023
• Geographic expansion into new markets
• Expanded service footprint enables ~2x
share growth by 2023
© 2021 JELD-WEN | Investor Day
Long term and sustainable competitive advantage
• INTEGRATED value stream analysis from raw material to
finished product
• STANDARDIZED product offering to simplify ordering and
fulfillment, reducing SKU’s from the hundreds to the 20’s
• SOLVED key customer challenge, increasing penetration
with key builder and channel partners
• STREAMLINED end to end process, eliminating waste,
driving efficiencies, and improving the customer experience
• INCREASED throughput and aligned capacity, drives
additional growth opportunities in interior doors and across
product lines
Interior Doors Competitive
Advantage in Value Stream
30
© 2021 JELD-WEN | Investor Day
• Hands-Free Assembly
using Robotics
• Automated Guided Vehicle
(AGV’s) transportation
• Multi-functioning tooling
for flexibility
• Single Piece Flow
• Contemporary high-end
sliding door solutions
• Entry door systems with
IoT functionality
• Increasing utilization of
composite wood materials
• Expanding digital
transaction experience
• Field deployment of real
time product support tools
• Developing best in class
order configurator tools
Innovation Fuels Growth
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Process
Innovation
Product
Innovation
Customer Experience
Innovation
© 2021 JELD-WEN | Investor Day
JELD-WEN
Accelerated
Growth (JAG)
33
Shawn LaskoskiSenior Vice President, Corporate Strategy and Business Development
© 2021 JELD-WEN | Investor Day 34
JEM tools and processes enable multi-faceted growth
JELD-WEN Excellence Model (JEM) JELD-WEN Accelerated Growth (JAG)
JEM is also for Growth
Breakthrough
Innovation
Core
Growth
Inorganic
Growth
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S U S T A I N A B L E C O M P E T I T I V E A D V A N T A G E
OPERATIONAL EXCELLENCELEADERSHIP AND GROWTH
EXCELLENCE
Six Sigma/Variation
Reduction
Integrated Business
PlanningGoal Deployment
Talent Dev. and
Acquisition
Supply Chain/ Material
ProcessesERP Strategic Planning Lean Leadership
ACHIEVE CONTINUOUS IMPROVEMENT CULTURE
Changeover Reduction
(SMED)/TPM
Poka Yoke/Quality At
The Source
Commercial
ExcellenceInnovation Excellence
Manufacturing System
DesignPull/Kanban/Flow
Segmentation and
Value Propositions
Product/Process Dev.
and Validation
Model CellStandard Work w/
Layered Process AuditRACI: Accountability
Project/Diagonal
Management
Gemba Walks5s Workplace
Organization
Transaction Process
ImprovementChange Management
Visual Management: SQDCI and Hour X Hour Boards KaizenValue Stream/
Process Mapping
B A S I C P R O B L E M S O L V I N G ( I N C L U D I N G A 3 )
V O I C E O F C U S T O M E R
E N V I R O N M E N T A L , H E A L T H a n d S A F E T Y
© 2021 JELD-WEN | Investor Day 35
Universal (“U”) Strategy for Growth
35
PREMIUM MATERIALS FOR
HIGH-PERFORMANCE
EXTERIOR & INTERIOR
BUILDING PRODUCTS
CUSTOMER
EXPERIENCE
CONSTRUCTION
INDUSTRY
PRODUCTIVITY
INNOVATION AND SUSTAINABILITY
Universally applied strategy – across all customer segments,
all regions, all offerings, and all brands
© 2021 JELD-WEN | Investor Day
Create differentiated
position by delivering best
CX at all touchpoints,
enabled by digital
Builder and Consumer Brands
that Generate Pull
Engage Architects, Designers,
and Specifiers
Reinvented End-to-End
Experiences for Builders,
Partners and Homeowners
36
Enhanced customer experience will drive profitable organic growth
… to ensure continued CX
leadership, foundational to
our strategy
EXECUTE PLAN IN
AGILE FASHION
…evergreen capabilities
roadmap and investments
required to deliver
PERPETUAL FUTURE-STATE
CUSTOMER EXPERIENCE
Architects /Designers
HomeownerBuilder
Channel Partner
ACCELERATED GROWTH VIA:
Differentiated Customer Experience
Customer Experience Actions Across Full End-to-End Customer Journey
36
© 2021 JELD-WEN | Investor Day
Construction Productivity
Aid construction industry with
productivity challenges and
drive adoption of new methods
that address labor challenges
Market Development for
Emerging Technologies
Turnkey Solutions
ACCELERATED GROWTH VIA:
Increasing Construction Productivity
Offerings that increase construction productivity present new growth opportunities
Better Products, New Opportunities
Labor Shortages
Global Supply Chain
Construction Dynamics
37
Pre-Fabrication
© 2021 JELD-WEN | Investor Day
Current Synergies, Future Opportunities
Entry and Patio Doors
Premium Materials for
High-performance Exterior and
Interior Building Products
Adjacent Opportunities
Interior Doors
Windows
ACCELERATED GROWTH VIA:
Market Driven Offerings
38
Capital deployment and inorganic activity will accelerate growth
Offering Focus
* Source: JELD-WEN - US Home Builder Survey March 2021
38
*
*
© 2021 JELD-WEN | Investor Day 39
Innovation and sustainability are core to creating growth
ESG AlignmentInnovation Priorities
Innovation Focus Areas Sustainability Focus Areas
Energy Efficiency
Circular Products
Sustainable Processes
Waste / Water Management
Connected Offerings (IoT)
Integrated Product Systems
Construction and
Installation Methods
Material Science
ACCELERATED GROWTH VIA:
Sustainable Innovation
39
© 2021 JELD-WEN | Investor Day 40
David GuernseyExecutive Vice President and President, Europe
Multi-faceted
Growth Opportunities
in Europe
© 2021 JELD-WEN | Investor Day 41
Driving leadership with service, product and innovation
• Broad portfolio
• Well established brands
• Strong customer relationships
• Residential and Commercial
• #1 or #2 in present markets
• Manufacture close to customers
• Vertically integrated
JELD-WEN is the door
leader in Europe
#1 in doors in Europe
32 Production facilities
€13B Market
12 Brands
Positioned to Grow
Operating from 17 countries
Serving 300M people
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© 2021 JELD-WEN | Investor Day
Big opportunities in markets and segments yet to be addressed
Segment Potential
Solve Product Gaps in Current Footprint
• High Performance Products to UK
and France
• Exterior door opportunities in Germany
and UK
• Steel products to N. Europe
Geography Potential
Pursue Organic and Inorganic expansion
• Adjacent Countries
• Eastern Europe
Share Acquisition
Leverage Brand and Incumbency
• Service Advantage
• e-Commerce
• Product Innovation
Market Addressed by JELD-WEN Market Opportunity for JELD-WEN
€13B*
* Management estimate of European door market size
Leadership and Significant Growth Potential
42
© 2021 JELD-WEN | Investor Day
Creates value and efficiency for customers with a unique
approach to lead times for make-to-order product
5 Day
Guaranteed 5 day lead time
Basic product options
Higher price premium
10 Day
Guaranteed 10 day lead time
More complex product options
Moderate price premium
Standard
15-30 day lead time
Technical product portfolio
Standard pricing
• Customer managed configurator
• Differentiated from competitors by rich
product data
• Enables instantaneous quotations
• 20%-40% reduction in order processing time
• EDI to JELD-WEN factory
• Integration with customer’s ERP
• Order confirmation in hours vs days
enabling 5 Plus process
Customer preferred configuration, quotation,
order entry and order management tool
Service proposition enabled by digital platform, unique
manufacturing process and JEM
Creating Value for our Customers
Superior customer experience driving above market growth
43
© 2021 JELD-WEN | Investor Day
Actively removing friction from the buying experience
Rapid-development techniques delivered
B2B e-Commerce platforms to France and
the UK in <90 Days
Establishing platform leverageable globally
e-Commerce orders average 40% larger than
traditional order entry
Rapid deployment continues to Northern Europe
Additional business to consumer options offered
through our big box, merchant and online partners
Order cycle time reduced from up to 24 hours
to 30 minutes
Expanding Service
Superiority with e-Commerce
44
© 2021 JELD-WEN | Investor Day
The Smart Door
Eco-Options
Continued leadership through innovation
• New product innovations drive about 30%
of our growth
• Securing and increasing our market
leading position
• Addressing developing customer
preferences
• Sustainability
• Connected Home / IOT
Leading Through Innovation
45
© 2021 JELD-WEN | Investor Day
Our JELD-WEN Home:
Our ESG Ambition
46
Roya BehniaExecutive Vice President, General Counsel and Chief Compliance Officer
© 2021 JELD-WEN | Investor Day
Through our products, processes, and partnerships
we care for people and the planet we call home
M A T E R I A L S T H A T M A T T E R D O O R S T H A T O P E N W I N D O W S T H A T B R I G H T E N
Sustainable Supply Chain
and Circular Economy
Energy Efficient
Product Portfolio
Diversity, Equity and
Inclusion
Innovation and Research
Health and Safety
Transparency, Reporting
and Accountability
Our JELD-WEN Home: Our ESG Ambition
47
© 2021 JELD-WEN | Investor Day
Sustainable Supply Chain
and Circular Economy
Materials That Matter: Highlights
Energy Efficient
Product Portfolio
48
• Investing in systems that support cradle-to-cradle product lifecycles
• Manufacturing wood doors that are FSC/PEFC certified or the equivalent
• Increasing proportion of products from recycled materials
• Increasing volume of recycled content across the full product portfolio
• Designing products for circular end-of-use disposal
• ENERGY STAR Partner since 1998
• Targeting ENERGY STAR certification for all new products developed
in North America
• Two product lines certified by the Passive House Institute for energy
efficiency
• Doors made of 100% sustainable materials
• Energy efficiency certified across product lines
• Canadian Northern Tri-Pane Collection™ windows help heating and
cooling and can decrease sound transmission
© 2021 JELD-WEN | Investor Day
Diverse Representation Female (global) Ethnically Diverse (US)
Workforce 24% 31%
Management 20% 16%
Professional 46% 19%
• Three women on our Board of Directors including first person of color
• Requiring a diverse slate for selection and succession for leadership
positions
• Conducting proactive interventions to eliminate discriminatory bias
Doors That Open: Highlights
50
Diversity, Equity and Inclusion
Innovation and Research
• Hired a global lead for innovation; established global
innovation teams enabled by idea management systems
• Revamping our portfolio management process to increase focus
on transformational and cutting-edge ideas
• Expanding our capabilities and investment in material science
WINDOWS THAT BRIGHTEN: HIGHLIGHTS
• Implementing best-in-class health and safety
management systems, standards and training
requirements to prevent workplace injuries, fatalities
and illness
• 74 full-time employees focused on health and
safety and 50 full-time employees focused on
environmental issues
• Launched health and safety campaign focusing on
12 critical safety rules
Windows That Brighten:
Highlights
51
Health and Safety
© 2021 JELD-WEN | Investor Day
© 2021 JELD-WEN | Investor Day
• We are building integrated sustainability reporting systems
• Our executive compensation is linked to ESG metrics on
safety, employee engagement and diversity
Windows That Brighten:
Highlights
21,000+ 19 85%
languages response
rate in 2020
associate engagement
surveys sent
Increasing visibility and transparency
52
© 2021 JELD-WEN | Investor Day
Delivering Exceptional
Shareholder Returns
54
John LinkerExecutive Vice President and CFO
© 2021 JELD-WEN | Investor Day
$95
$259
2015 2020
$311
$446
2015 2020
$3,381
$4,236
2015 2020
Demonstrated revenue and earnings growth with compounding cash flow
Adjusted EBITDA Free Cash FlowNet Revenue
Extraordinary Track Record of Performance
55
USD in millions
© 2021 JELD-WEN | Investor Day
Delivering results and providing visibility to future revenue growth, margin expansion, and compounding cash flow
Volume Deliver above market growth Volume growth accelerating
PricingPrice realization exceeds
material and freight inflation10 consecutive quarters of favorable price/cost
ProductivityAnnual reduction in COGS
excluding volume/price/mix~$50M of savings achieved from 2018 – 2020
Fixed Cost Annual reduction in fixed costs 1.5M sq. ft. reduction in footprint since 2018
Working CapitalAnnual reduction in net working
capital as percent of revenue160 bps reduction as percent of sales 2018 - 2020
TARGET DEMONSTRATED TRACK RECORD
Multi-faceted Framework for Growth and Cash
56
© 2021 JELD-WEN | Investor Day
2015 2020
Adjusted EBITDA Per Employee
2020 Cost of Goods Sold
Material
Labor
Freight
Variable Overhead
Fixed Overhead
2015 2020
Direct Labor % of Cost of Goods Sold
Highly Variable
Cost Structure
Enabled by JEM
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Highly variable cost structure provides platform for profitable growth;JEM enables ongoing improvements in cost structure
Variable costs
Near-term fixed costs
© 2021 JELD-WEN | Investor Day
High cash conversion supported by JEM and favorable tax attributes
11.6%
10.5%
10.0%
2018 2019 2020
105.4%98.4%
138.9%
2018 2019 2020
35.1%
22.2%
17.5%
2018 2019 2020
Net Working Capital %
of Sales (1)
D&A as % of Capital
ExpendituresEffective Cash Tax Rate
160 bps
reduction
enabled by
JEM
Capital
expenditures
at or below
D&A
Favorable tax
attributes
Attractive Cash Conversion Dynamics
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1. Net working capital = Accounts receivable + Inventory – Accounts Payable – certain Accrued Expenses
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Disciplined approach to capital allocation driving enhanced ROIC
8.8%
9.9%
11%-12%
2019 2020 2021F
Cash Deployed 2017 – 2020 (~$940M) Return on Invested Capital
Capital Expenditures
M&A
Share Repurchases
Debt Reduction
Return on invested capital = [(Adjusted EBITDA minus D&A) * (1 - 27% tax rate)] / [Current Assets - Non-Interest Bearing Current
Liabilities + Net PP&E + Goodwill and Intangibles + Operating Lease Asset - Cash in excess of $100M minimum operating cash]
Balanced and Disciplined Capital Deployment
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© 2021 JELD-WEN | Investor Day
ORGANIC REVENUE
CAGR 2021 -2025
Above market
= 6% to 8%
2025 ADJUSTED
EBITDA MARGIN
15% to 17%
FREE CASH FLOW
CONVERSION 2021 -2025
90% to 100%of adjusted net income
CAPITAL ALLOCATION
2021-2025
~$4 billionof M&A capacity(1);
share repurchase
as alternative
Multi-faceted growth platform will deliver growth, margin expansion,
and compounding cash flow through disciplined capital allocation
High Visibility to Achieving 2025 Targets
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© 2021 JELD-WEN | Investor Day
Well-positioned to deliver achievable long-term margin target
11.2%
15% to 17%
2025 Plan - Adjusted EBITDA Margin
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© 2021 JELD-WEN | Investor Day
Reconciliation of Non-GAAP
Financial Measures
Management uses certain non-GAAP financial measures and considers them to be important supplemental measures of the company's performance. In addition, management believes these non-GAAP financial
measures provide additional insight for analysts and investors in evaluating the company's financial and operating performance. These non-GAAP financial measures should not be considered alternatives to, or
more meaningful indicators of, the company's financial measures as prepared in accordance with GAAP. The company's methods of determining these non-GAAP financial measures may differ from the
methods used by other companies and may not be comparable. The company also provides certain guidance solely on a non-GAAP basis because the company cannot predict certain elements that are included
in certain reported GAAP results, including the variables and individual adjustments necessary for a reconciliation to GAAP. While management is not able to specifically quantify the reconciliation items for
forward-looking non-GAAP measures without unreasonable effort, the company expects these items to be similar to the types of charges and costs excluded from Adjusted EBITDA in prior periods. Management
bases the estimated ranges of non-GAAP measures for future periods on its reasonable estimates of such factors as assumed effective tax rate, assumed interest expense, stock-based compensation expense,
litigation expense, and other assumptions about capital requirements for future periods. The variability of these items may have a significant impact on our future GAAP financial results. We use Adjusted
EBITDA, Adjusted EBITDA margin, Adjusted net income, and Adjusted EPS because we believe they assist investors and analysts in comparing our operating performance across reporting periods on a
consistent basis by excluding items that we do not believe are indicative of our core operating performance. Management believes Adjusted EBITDA and Adjusted EBITDA margin are helpful in highlighting
trends because they exclude the results of decisions that are outside the control of management, while other measures can differ significantly depending on long-term strategic decisions regarding capital
structure, the tax jurisdictions in which we operate, and capital investments. We use Adjusted EBITDA and Adjusted EBITDA margin to measure our financial performance and also to report our results to our
board of directors. Further, our executive incentive compensation is based in part on Adjusted EBITDA. In addition, we use Adjusted EBITDA for purposes of calculating compliance with our debt covenants in
certain of our debt facilities. Adjusted EBITDA should not be considered as an alternative to net income as a measure of financial performance or to cash flows from operations as a liquidity measure. We define
Adjusted EBITDA as net income (loss), adjusted for the following items: loss from discontinued operations, net of tax; equity of non-consolidated entities; income tax (benefit) expense; depreciation and
amortization; interest expense, net; impairment and restructuring charges; gain on previously held shares of equity investment; (gain) loss on sale of property and equipment; share-based compensation
expense; non-cash foreign exchange transaction/translation (income) loss; other non-cash items; and costs related to debt restructuring and debt refinancing. Adjusted EBITDA margin is defined as Adjusted
EBITDA divided by net revenues. We present free cash flow because we believe it assists investors and analysts in determining the quality of our earnings. We also use free cash flow to measure our financial
performance and to report to our board of directors. In addition, our executive incentive compensation is based in part on free cash flow. We define free cash flow as cash flow from operations less capital
expenditures (including purchases of intangible assets). Free cash flow should not be considered as an alternative to cash flows from operations as a liquidity measure. We also present net debt leverage
because it is a key financial metric that is used by management to assess the balance sheet risk of the company. We define net debt leverage as net debt (total principal debt outstanding less unrestricted cash)
divided by adjusted EBITDA for the last twelve month period. Adjusted net income represents net income adjusted for certain items as presented in our reconciliation of non-GAAP, including the after-tax impact
of i) non-cash foreign currency (gains) losses, ii) impairment and restructuring charges, iii) one-time, non-cash gains, and iv) other non-recurring expenses associated with certain matters such as mergers and
acquisitions, and litigation. Adjusted EPS represents net income per diluted share adjusted to exclude the estimated per share impact of the same specifically identified items used to calculate adjusted net
income as described above. Where applicable such items are tax-effected at our estimated annual effective tax rate. We also present Return on Invested Capital (ROIC) because we believe ROIC is a
meaningful metric of how effectively we create value from cash deployment. Although ROIC is a common financial metric, numerous methods exist for calculating ROIC. Accordingly, the method we use may
differ from the methods used by other companies.
Due to rounding, numbers presented throughout this presentation may not sum precisely to the totals provided and percentages may not precisely reflect the absolute figures.
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© 2021 JELD-WEN | Investor Day
Non-GAAP Reconciliation
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USD in millions
Year Ended December 31,
2015 2016 2017 2018 2019 2020
Net income $ 90.9 $ 376.1 $ 8.1 $ 141.9 $ 63.0 $ 91.6
Adjustments:
Loss from discontinued operations, net of tax 2.9 3.3 — — — —
Equity earnings of non-consolidated entities (2.4) (3.8) (3.6) (0.7) — —
Income tax expense (benefit) (5.4) (246.8) 137.8 (10.1) 57.1 25.1
Depreciation and amortization 95.2 108.0 111.3 125.1 134.0 134.6
Interest expense, net 60.6 77.6 79.0 70.8 71.8 74.8
Impairment and restructuring charges 31.0 18.4 13.1 17.3 22.7 10.7
Gain on previously held shares of equity investment — — — (20.8) — —
(Gain) loss on sale of property and equipment (0.4) (3.3) (0.3) 0.1 1.7 (4.2)
Share-based compensation expense 15.6 22.5 19.8 15.1 13.3 16.4
Non-cash foreign exchange transaction/translation loss
(income) 2.7 5.7 (1.2) (1.3) 3.4 12.9
Other non-cash items 1.1 2.8 0.5 3.9 0.7 —
Other items 18.9 30.6 47.0 117.5 47.3 84.1
Costs relating to debt restructuring and debt refinancing 0.2 1.1 23.7 0.3 — 0.2
Adjusted EBITDA $ 311.0 $ 392.2 $ 435.2 $ 459.2 $ 415.0 $ 446.4
Year Ended December 31,
2015 2016 2017 2018 2019 2020
Net cash provided by operating activities $ 172.3 $ 201.6 $ 265.8 $ 219.7 $ 302.7 $ 355.7
Less capital expenditures (1)(77.7) (79.5) (63.0) (118.7) (136.2) (96.9)
Free cash flow $ 94.7 $ 122.1 $ 202.7 $ 101.0 $ 166.5 $ 258.8
(1) Capital Expenditures defined as purchases of property, equipment and intangible assets
© 2021 JELD-WEN | Investor Day
End Market Channel Product
Leading doors and windows solutions
Overview
• ~$520 million provider of windows, doors, and ancillary products, primarily for the residential
new construction and repair and remodel markets
• Broad portfolio of well-established brands, with #1 share position in both windows and doors
Australasia
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2 0 2 0 R E V E N U E
Residential New Construction
Residential Repair and Remodel
Non-residential
Doors
Windows
Other
Direct to Builder/Consumer
Traditional Distribution
Retail/Home Center