Myers Industries Q1 2025 Earnings Report

Myers Industries EPS Results

• Actual EPS: $0.22
• Consensus EPS: $0.19
• Beat/Miss: Beat by +$0.03
• One Year Ago EPS: N/A

Myers Industries Revenue Results

• Actual Revenue: $206.75 million
• Expected Revenue: $206.80 million
• Beat/Miss: Missed by -$50.00 thousand
• YoY Revenue Growth: N/A

Myers Industries Announcement Details

• Quarter: Q1 2025
• Date: 5/1/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, May 1, 2025
• Conference Call Time: 8:30AM ET

Myers Industries (NYSE:MYE) engages in distribution of tire service supplies in Ohio. It operates through two segments, The Material Handling and Distribution. The Material Handling segment offers pallets, small parts bins, bulk shipping containers, and OEM parts, as well as storage and organization, and custom plastic products; and injection molded, rotationally molded or blow molded products, consumer fuel containers and tanks for water, fuel, and waste handling. It serves industrial manufacturing, food processing, retail/wholesale products distribution, agriculture, automotive, recreational and marine vehicles, healthcare, appliance, bakery, electronics, textiles, consumer markets, and other markets under Akro-Mils, Jamco, Buckhorn, Ameri-Kart, Scepter, Elkhart Plastics, Trilogy Plastics, and Signature Systems brands directly to end-users, as well as through distributors. The Distribution segment engages in the distribution of tools, equipment, and supplies for tire, wheel, and under-vehicle service on passenger, heavy truck, and off-road vehicles; and manufacture and sale of tire repair materials and custom rubber products, as well as reflective highway marking tapes under the Myers Tire Supply, Myers Tire Supply International, Tuffy Manufacturing, Mohawk Rubber Sales, Patch Rubber Company, Elrick, Fleetline, MTS, Seymoure, Advance Traffic Markings, and MXP brands. This segment serves retail and truck tire dealers, commercial auto and truck fleets, auto dealers, general service and repair centers, tire re-treaders, truck stop operations, and government agencies. Myers Industries, Inc. was founded in 1933 and is headquartered in Akron, Ohio.

Myers Industries Q1 2025 Earnings Call Transcript

Presentation

[Operator]

I would now like to hand you over to Megan Mehringer, Senior Director of Investor Relations at Myers Industries to begin. Megan, please go ahead when you're ready.

[Meghan Beringer, Senior Director of Investor Relations at Myers Industries]

Thank you. Good morning, everyone, and thank you for joining Myers conference call to review twenty twenty five first quarter results. I'm Megan Behringer, senior director of investor relations at Myers Industries. Joining me today are Aaron Shopper, president and chief executive officer Grant Phipps, executive vice president and chief financial officer and Dan Holmes, vice president, corporate controller. After the prepared remarks, we will host a question and answer session.

[Meghan Beringer, Senior Director of Investor Relations at Myers Industries]

Earlier this morning, we issued a press release outlining our first quarter financial results. We have also posted a presentation to accompany today's prepared remarks. Both are available under the Investor Relations tab at www.myersindustries.com. This call is being webcasted on our website and will be archived along with the transcript of the call shortly after this event. Please turn to slide three of the presentation for our safe harbor disclosures.

[Meghan Beringer, Senior Director of Investor Relations at Myers Industries]

I would like to remind you that we may make some forward looking statements during this call. These comments are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and involve risks, uncertainties and other factors, which may cause results to differ materially from those expressed or implied in these statements. Further information concerning these risks, uncertainties and other factors are set forth in the company's periodic SEC filings. Also, please be advised that certain non GAAP financial measures such as the adjusted gross profit, adjusted operating income, adjusted EBITDA, and adjusted earnings per share may be discussed on this call.

[Meghan Beringer, Senior Director of Investor Relations at Myers Industries]

Now please turn to slide five of our presentation as I will now turn the call over to Aaron.

[Aaron Schapper, President & CEO at Myers Industries]

Thank you, Megan. Good morning, everyone, and thank you for joining us. On today's call, I will begin by reviewing first quarter highlights. Then I'll provide an update on our focused transformation, our progress since our fourth quarter's earnings call, and our unique characteristics that define Myers. Following my comments, Greg will provide a detailed review of the first quarter financials, followed by Dan who will review our outlook for the year.

[Aaron Schapper, President & CEO at Myers Industries]

First quarter revenue was flat year over year. Growth in material handling was led by the contribution of our signature acquisition industrial growth for military products, offset by lingering softness in our distribution segment. Margins improved as we did a nice job of controlling costs. SG and A, which is a focus of our 2025 cost savings program, was lower as a percent of sales, resulting in an increase in EPS. I'm pleased with the team's focus and performance, and I am reassured by the solid start to the year.

[Aaron Schapper, President & CEO at Myers Industries]

At the same time, there are clear opportunities to improve, and I am confident that we are on the right path to elevate our performance. Before moving on, I would like to address tariffs as they pertain to Myers directly. Please turn to slide six. Our supply chain is predominantly based in The US. Most of the materials we purchase are from US suppliers.

[Aaron Schapper, President & CEO at Myers Industries]

15 of our 16 manufacturing plants are here in The US. More than 90% of our 2025 material handling revenue is expected to be manufactured in The US. Further, the remaining 10 of revenue from this segment is currently protected by the USMCA and military exemptions. For distribution, less than 15% of our products are sourced from China. We plan to use pricing to offset tariff costs and have secured secondary and tertiary suppliers to mitigate the impact to our customers.

[Aaron Schapper, President & CEO at Myers Industries]

This predominantly domestic placed supply chain should provide resilience to tariff driven disruptions. As a result, we expect minimal direct impact from the current tariffs. We are also positioned to provide options for supply chain resiliency to our customers to help them mitigate these disruptions. Of course, this is a dynamic situation, and we continue to closely monitor any impact on factors that would alter end market demand trends. We stand ready to execute across a wide variety of scenarios should we find ourselves in an altered landscape than we are currently expecting.

[Aaron Schapper, President & CEO at Myers Industries]

Turning to slide seven. During our fourth quarter earnings call, I introduced our focus transformation program. We're call, developing this plan to change course and accelerate our timeline to deliver more consistent and reliable results. During my conversation with employees, I'm encouraged with how they are embracing the positive cultural shift to elevate our performance. Let's review the four objectives and the early progress that we are achieving.

[Aaron Schapper, President & CEO at Myers Industries]

The first objective is to establish a culture of execution and accountability to drive performance. We have adjusted our core values to include deliver results and continuous improvement, emphasizing a culture of lean management supported by clear, efficient processes. We have aligned incentive plans with individual business unit performance while retaining overall executive accountability to shareholders for corporate targets. These changes provide proper incentives to demonstrate our core values, motivating employees to achieve organic growth and profitability in each of our businesses. I believe these actions will drive cultural change, igniting a fire in our employees and validating the opportunity that attracted me to Myers.

[Aaron Schapper, President & CEO at Myers Industries]

Our second objective is to create clear strategies, including action plans and specific KPIs to improve the profitability of our entire portfolio. We are off to a rapid start. Over the past few weeks, we completed a series of employee workshops to review and evaluate the businesses in our portfolio, developing strategies for each based on their characteristics. Some of our businesses serve high growth markets. We will invest to support these businesses to continually drive organic growth.

[Aaron Schapper, President & CEO at Myers Industries]

We have other businesses serving lower growth markets that do not require significant investments but generate strong cash flow to fund high growth businesses and fortify our ability to return cash to shareholders. Finally, we have a few businesses that are not performing at the level we expect. We are developing and implementing plans to improve these businesses within a reasonable time frame. I am optimistic that we are on the right path to drive improved performance across our entire portfolio. We plan to announce our updated long term strategy for each business by the end of this year after we complete the necessary foundational work.

[Aaron Schapper, President & CEO at Myers Industries]

Our third objective is to deliver consistent and reliable results by effectively controlling what we can control. The first step that we announced during our last quarterly update is deliver annualized cost savings of 20,000,000 by year end 2025, primarily in s g and a to reduce costs while enhancing operational efficiency. From my experience in managing business in dynamic markets, optimizing cost structure is vital during challenging markets and rewarding enough swings. The workshops I mentioned earlier were instrumental in identifying specific actions to drive efficiencies into the organization to build a foundation for long term sustainable growth. We overachieved our signature synergy targets, delivering 12,000,000 in cost synergies against our 8,000,000 target.

[Aaron Schapper, President & CEO at Myers Industries]

We are confident in our continued path towards 20,000,000 annualized cost savings commitment. Our fourth and final objective is to optimize cash flow and support disciplined capital allocation deployment. Last quarter, we launched a new $10,000,000 share repurchase plan. In addition, we will continue to invest in organic growth, maintaining our CapEx target of around 3% of sales and focusing on high growth opportunities that deliver superior returns. It is early days on our focused transformation, but I'm pleased with the initial pace of progress and confident in our team's ability to deliver improved financial results from the changes we are making.

[Aaron Schapper, President & CEO at Myers Industries]

Our mission is to provide products that protect the world from the ground up. I'd like to discuss two examples of how we do this beginning on slide eight. Many large stadiums with turf playing surfaces would like to expand the functionality of their properties and increase the revenue opportunity. This creates a challenge to properly protect the playing service to eliminate damage that could lead to player injuries. In addition, the cost and time of converting the playing service limits the revenue generating potential.

[Aaron Schapper, President & CEO at Myers Industries]

Our omnidec flooring system provides a differentiated solution. It is strong and durable, protecting the surface from machinery, staging, equipment, and foot traffic. It is lightweight, reducing the time and cost to repurpose the facility. As a result, the integrity of the playing surface remains intact. We have seen great success from our customers with this product.

[Aaron Schapper, President & CEO at Myers Industries]

I invite you to view the video linked in our presentation to see a testimonial from our newest customer, SoFi Stadium. Another example of our mission in action is shown on slide nine, protecting our troops. Historically, our military used wood or steel packaging for ammunition. These are heavy, increasing the cost of transport and the stress on soldiers that carry these containers in the field. Our sector solution provides lighter, better, safer, and battle proven packaging for transporting ammunition for the defense industry.

[Aaron Schapper, President & CEO at Myers Industries]

Delivering a 41% weight savings, soldiers injuries are reduced, keeping them healthier to train and accomplish their primary mission. In addition, the transportation costs are reduced, enabling the military to allocate resources to other critical areas. We are so proud to support, serve, and protect our troops. These examples highlight who we are as a company and how we deliver value to our customers. Since our last earnings call, we have made progress on achieving our commitments.

[Aaron Schapper, President & CEO at Myers Industries]

We have acted quickly, starting the journey to create a culture built on accountability that fulfills our commitments and delivers results with a continuous improvement mindset. Building on this momentum, we are moving forward with purpose, transforming Myers with speed, agility, urgency, and acting with integrity. I will continue to meet with customers and investors, listening to your feedback to ensure we are creating value for you. With that, I will turn the call over to Grant to discuss our first quarter results. As previously announced, Grant will be stepping down as our CFO tomorrow.

[Aaron Schapper, President & CEO at Myers Industries]

I wish to thank him publicly on behalf of the entire company. Although our time working together was short, I recognize the contribution he has made here since joining the organization, and I'm grateful for the help he has provided to me during my transition. He will be missed, and we wish him all the best. Dan Hone, vice president, corporate controller, will serve as interim CFO while we undergo a formal search, which has been launched to identify our next finance chief. Over to you, Grant.

[Grant Fitz, Executive VP & CFO at Myers Industries]

Thank you, Erin, for those kind words, and good morning, everyone. I am proud of what we have accomplished during my time at Myers, and I truly believe the organization is heading in the right direction as our focused transformation program is already showing signs of improvement. I look forward to following Myers' future success. Turning to our financial results on slide 11. First quarter net sales of $206,800,000 were essentially flat year over year as growth in material handling led by the impact of our Signature acquisition was offset by lingering softness in our distribution segment.

[Grant Fitz, Executive VP & CFO at Myers Industries]

As a reminder, Signature was closed on February eighth of last year. This will be the last quarter we will call out its inorganic contribution to year over year performance. We expanded adjusted gross margin 80 basis points to 33.5% driven largely by the acquisition of Signature and favorable product mix. Adjusted operating income improved to $18,700,000 with margin improving 100 basis points to 9% of sales. We also reduced SG and A expenses for the quarter.

[Grant Fitz, Executive VP & CFO at Myers Industries]

We will begin to see our focused transformation work deliver further SG and A run rate savings next quarter and through the balance of the year. Adjusted EBITDA margin also improved, expanding 170 basis points. Diluted adjusted earnings per share were $0.22 compared to $0.21 in 2024 on improved operating income, partially offset by higher net interest expense. Turning to slide 12. Net sales for Material Handling increased 3.6% compared to the prior year, primarily due to the contribution from the Signature acquisition.

[Grant Fitz, Executive VP & CFO at Myers Industries]

Industrial sales were stronger primarily for military applications. We saw cyclical softness in food and beverage for seed box demand. Material Handling's adjusted EBITDA increased 11.7% to $36,300,000 resulting in a 60 basis point increase in adjusted EBITDA margin to 23%. These improvements were attributed largely to our increased signature product mix and our ability to effectively reduce SG and A and manufacturing costs. Distribution net sales decreased 10.3% on lower volume and pricing.

[Grant Fitz, Executive VP & CFO at Myers Industries]

Adjusted EBITDA decreased to $500,000 primarily due to lower gross margin, partially offset by lower SG and A due to an improved cost structure resulting from our distribution center consolidation. Turning to slide 13. Operating cash flow was lower this quarter on an increase in working capital due to accounts receivable timing and a build in inventory as we took some proactive action before the tariff details were announced. We expect working capital to improve in future quarters. We allocated $8,100,000 to CapEx as we continue to invest in organic growth.

[Grant Fitz, Executive VP & CFO at Myers Industries]

We maintain total liquidity of $267,000,000 including $231,700,000 of availability under our current revolving credit facility and cash on hand of $35,300,000 providing us with additional flexibility to support our capital allocation priorities. Please turn to Slide 14. As Aaron mentioned, we repurchased 1,000,000 in shares under our share repurchase program announced last quarter. There remains $9,000,000 under this authorization and we plan to continue making opportunistic purchases to complement our ongoing dividends as we return cash to shareholders. Debt was essentially flat for the quarter with our net leverage ratio at 2.8 times.

[Grant Fitz, Executive VP & CFO at Myers Industries]

As mentioned before, we are targeting a ratio of 1.5 to 2.5 times. At this time, I will now turn the call over to Dan to review our current 02/2025 outlook. Dan?

[Daniel Hoehn, VP & Corporate Controller at Myers Industries]

Thank you, Graham. And let me also wish you well. As we did during our last quarterly update, we are sharing some high level qualitative expectations for the year, which are shown on slide 16. We see both risks and opportunities for the businesses and we'll continue to monitor end market conditions for impacts from tariffs or other factors that may influence demand trends. Let me review our expectations by market.

[Daniel Hoehn, VP & Corporate Controller at Myers Industries]

Industrial should continue with moderate growth driven by global inventory replenishment for military applications and to a lesser extent for bulk container and organizational products. In infrastructure, ongoing strong project spending supported by material conversion from wood matting should continue to support strong growth. We now expect the vehicle end market, which includes RV and marine to be down as a result of economic uncertainty driven by developing tariff impacts. We previously expected this end market to be stable to down. In consumer, we anticipate stable sales of fuel containers and an expected return to a more normalized storm season.

[Daniel Hoehn, VP & Corporate Controller at Myers Industries]

Our food and beverage end market, including agriculture, is projected to be stable. Automotive aftermarket distribution is expected to be slightly down. We are working to stabilize this business as we improve our cost structure, sales territory alignment, and digital sales strategy. We will continue to look for opportunities to expand our market presence and deliver solutions to our customers. At the same time, we expect financial results to improve as we make progress on our focused transformation.

[Daniel Hoehn, VP & Corporate Controller at Myers Industries]

I would now like to turn the call back to Aaron for some closing comments before we take your questions. Aaron?

[Aaron Schapper, President & CEO at Myers Industries]

Thank you, Dan. Our team at Myers is aware of the significant work that needs to take place to achieve our potential. We are moving forward with urgency to execute our focused transformation, which includes supporting and growing Myers uniquely differentiated products, which protect the world from the ground up. Rightsizing the organization to optimize our cost structure and support our growth initiatives with a continuous improvement mindset will enable us to work smarter and more efficiently and supporting a balanced capital allocation framework that invest in growth while returning cash to the shareholders. I continue to be excited about the opportunities to improve performance and create value for our customers, employees, and shareholders.

[Aaron Schapper, President & CEO at Myers Industries]

With that, I'd like to turn the call over to the operator for questions. Operator?

[Operator]

Thank you. We will now begin the question and answer session. If you'd like to ask a question, please press star followed by one on your telephone keypad. If you change your mind, please press star followed by 2. When preparing to ask your question, please ensure your device is unmuted locally.

[Operator]

We will make a quick pause here for the questions to be registered. And our first question comes from Christian Zyla with K Corp.

[Christian Zyla, Senior Associate Equity Research at KeyBanc Capital Markets]

Morning, everyone. Grant, it's been wonderful working with you and on behalf of the future. We wish you all the best in the future.

[Grant Fitz, Executive VP & CFO at Myers Industries]

Thanks so much, Christian. Likewise. It's been great to work with the KeyBank team.

[Christian Zyla, Senior Associate Equity Research at KeyBanc Capital Markets]

First question for me, just generally, thanks for the additional tariff detail on the distribution business. If I recall, there are a couple of facilities in Central America. Are those subject to tariffs? And then how price sensitive are your customers here if you raise price to offset the tariff costs you mentioned? Would you expect to see a volume offset in any of your business?

[Daniel Hoehn, VP & Corporate Controller at Myers Industries]

So the the Central America piece is a is a relatively small part of the distribution business. So while there is some impact of tariffs like like there is in the rest of the world, we don't expect that to have a material effect on buyers. From a price sensitive standpoint, of course, our customers are always looking for the best value that we can get, and it's our job. It's our job to to make a profit on on on product products that we're selling. So if we need to push price, we will.

[Grant Fitz, Executive VP & CFO at Myers Industries]

Yeah. I would just add too, Christian, on that is is that we do have, you know, we talked a little bit in the the this the opening comments that we are looking as well too for alternative suppliers where we we think that there's some value to do that. And so I think overall, you know, echoing on Dan's comments, we were we feel we're in a pretty good position, and we don't see, particularly in the distribution business, having a a significantly different footprint of supply than what we would see with other competitors, and we feel we're in a pretty good position on, working with our, with our suppliers and also, you know, leveraging price as needed.

[Christian Zyla, Senior Associate Equity Research at KeyBanc Capital Markets]

Got it. Understood. And then on free cash flow for the quarter, can you just walk through why that was so low year over year? And then just bigger picture, correct me if I'm wrong, but history suggests 15 to 20,000,000 of free cash flow per quarter should be achievable in a steady run rate for you guys. Is that how you think about the business or just any broader thoughts on that?

[Christian Zyla, Senior Associate Equity Research at KeyBanc Capital Markets]

Thank you.

[Grant Fitz, Executive VP & CFO at Myers Industries]

Sure, Christian. This is Grant. I'll take this one. I I think q one was a little bit different than what we've typically seen within Myers. As you know, we we typically have some very good operating cash flow with the business.

[Grant Fitz, Executive VP & CFO at Myers Industries]

And, essentially, we had two things that, that occurred in in this quarter. The first one was is that we had a very strong March, particularly with signature in our sector business. And so we just have some timing of accounts receivable on when those will actually be collected as those sales were driven more towards the end of the month. And then the second thing is is that as we were looking at the potential tariff impacts, we also looked at doing some opportunistic buys on inventory ahead of potential tariffs. And so those two items really, created a situation where we have a lower than than typical, historic, free cash flow for the business.

[Grant Fitz, Executive VP & CFO at Myers Industries]

We do anticipate that's gonna recover, throughout the year, as we see this continue. And I won't say that, we have any changes in terms of the pattern of the, the free cash flow that we would we would typically generate, for the year, and, certainly think that we're in a very good position. I think, quite frankly, you know, that's

[Grant Fitz, Executive VP & CFO at Myers Industries]

one of the real attractiveness is, or attractiveness to Myers. It's just the the ability for it to generate cash.

[Aaron Schapper, President & CEO at Myers Industries]

Yeah. Krishna, I would just add that, we're pretty happy. You know, we we remember the section three zero one tariffs when they came out back in 02/2018, and our team really was very proactive in making sure that we had what we needed to, mitigate any of the tariff pieces.

[Aaron Schapper, President & CEO at Myers Industries]

And, you know, sometimes there's bit bit bits and pieces that you have to get in. I think they did a great job of getting that inventory in early just remembering, you know, some of the other tariff shocks. So we moved quickly, and got things in so that we could make sure we mitigate price and make sure that our customers are taken care of. So we're in pretty good shape from that standpoint.

[Christian Zyla, Senior Associate Equity Research at KeyBanc Capital Markets]

Great. And last one for me and then I'll pass it back. This is just a joint question for Signature and Scepter as it relates to military. Have you seen any additional uptake in orders or qualification activities for your products in either of those businesses? And then for Scepter's ammunition containers, are you still projecting 40,000,000 this year from that contract?

[Christian Zyla, Senior Associate Equity Research at KeyBanc Capital Markets]

And then what are your thoughts for '26 and beyond for that? Thank you so much.

[Aaron Schapper, President & CEO at Myers Industries]

Yeah. We're very happy with the order flow and, you know, both sector and signature. So if you're looking at both new customers and new opportunities, I would say that we have both in both of those areas. We're very happy with the the growth of that. The business is performing well.

[Aaron Schapper, President & CEO at Myers Industries]

The customers we have good relationship with the customers. We're very close. So we anticipate both of those businesses to have strong growth going not only into this year, but looking into next year, we'll be looking at the capital that those businesses need to continue to grow, and we'll make sure that they're funded. We're looking at what more we can do in other areas, especially in Europe on the the sector side to see, the growth that we get there as well as signature. So not only do we have opportunities to grow here, domestically in our footprint, but we have also opportunities in Europe to grow there as well.

[Aaron Schapper, President & CEO at Myers Industries]

So we're pretty excited about the future of, those two businesses in particular.

[Christian Zyla, Senior Associate Equity Research at KeyBanc Capital Markets]

Great. Thanks. And, Dan, looking forward to working with you.

[Daniel Hoehn, VP & Corporate Controller at Myers Industries]

Likewise, Christian.

[Operator]

And our next question comes from William Desilam with Tietod Capital Management.

[Bill Dezellem, Founder, President & Chief Investment Officer at Tieton Capital Management]

Thank you. I have two questions. First of all, relative to the vehicle group, now forecasting that my apologies, my headset just died. So the vehicle group turning down, is that specific to RV, marine, the auto components business? Is it tied to something changing in the economy?

[Bill Dezellem, Founder, President & Chief Investment Officer at Tieton Capital Management]

Could you would you provide more detail behind, kind of that change in outlook, please?

[Aaron Schapper, President & CEO at Myers Industries]

Yeah. So, kinda, let let's take it in two parts. First, I take RV and marine, kind of the more recreational vehicle part. I mean, there remains a lot of hesitancy and caution among our customer base on that side. There's a lot of tariff uncertainty right now.

[Aaron Schapper, President & CEO at Myers Industries]

And, you know, when people are looking at potential inflationary pressures and then sustained, perhaps, sustained high interest rates or at least not coming back down as fast as they normally or at least as projected on a dot plot earlier in the year, you know, it it creates a lot of uncertainty on that side. So, you know, in general, a lot of RV and marine, products are financed. So when there's high interest rates, it makes it a lot harder for people to know, hey. How how all in they're gonna go. So, really, it's that kind of economic uncertainty right now that really affects the marine, and the RV, spending.

[Aaron Schapper, President & CEO at Myers Industries]

So at this point, our customers are not really sure, what the rest of the year is gonna look like. Therefore, they're just there's kind of like a wait and see kind of approach. So that's why, you know, from our projections, we thought, well, that's gonna be a wait and see is going to affect us. So that's why we project that market to not be as strong as we had in this. Particularly in the last call where things were looking up, that has definitely been a change since the tariffs, were announced.

[Aaron Schapper, President & CEO at Myers Industries]

So around that uncertainty. And then with, reflects automotive sides and, the parts in that, we do for the automotive side, well, I mean, that's been pretty well, covered on what's going on in the automotive side with the tariffs and everything else. So once again, until we with the caution hesitancy, a lot of, a lot of pieces and parts, are, you know, they're working out the taxes. They're working out the tariffs. So until we kinda get some stability and and cons where people actually know what all the tariff landscape's gonna look like, you're gonna see some ebb and flow on that side as well.

[Aaron Schapper, President & CEO at Myers Industries]

So right now, everyone's kinda waiting for some policy, with the state firming up on the tariff side, and then I think then that'll release. But, in the meantime, those are the two those are the two really hesitant and uncertain. I mean, people have had a really hard time forecasting what that's going to be right now. So just being transparent on what we see out in the market today.

[Bill Dezellem, Founder, President & Chief Investment Officer at Tieton Capital Management]

That is that is helpful. And do you sense that your RV marine customers that they have chosen to lower inventory, particularly, let their dealers, clear their lots a bit? Or, or is it something just more generic that they're in a bit of a pause mode due to not knowing?

[Aaron Schapper, President & CEO at Myers Industries]

Yeah. I think it's the latter where they're kind of in a bit of a pause mode in trying to figure out which way to go. We have heard some that are are looking to idle. Some of our customers looking at idle plants, but at this point, everyone is very much in a listen and learn mode and trying to understand well, you know, a lot of people talking to each other trying to understand the the where, kind of where the economy is going for this side. So I think at this point, it's kinda it's a pause situation.

[Aaron Schapper, President & CEO at Myers Industries]

I haven't heard anything specifically, other than that. And, you know, there's there's talk about what they're gonna do in the idling, what they're not going to do. But at this point, we haven't heard anything specific.

[Bill Dezellem, Founder, President & Chief Investment Officer at Tieton Capital Management]

Great. That's, that's helpful. And then relative to the distribution business, what as you've taken some time here to to learn this business, Aaron, what do you believe is needed to to turn the business given the circumstances it it it finds itself in today?

[Aaron Schapper, President & CEO at Myers Industries]

Well, the distribution business, I I'm still, learning that business. You know, it's a it's a different business. It's very much a service and sales business. It's incredibly important to be close to our customers on that side and understand what our customers' needs are. And and, you know, your customers' needs change over time and business evolve over time.

[Aaron Schapper, President & CEO at Myers Industries]

I think it's really important to look at where we are, from a sales organization and, you know, the services we provide to our customers. And, a, make sure that we're providing the right service that our customer needs, and, b, making sure that we create value when we're offering those services, and then we get paid according to that value. So at this point, it's still early for me. I'm learning that business. I have a lot more customer visits.

[Aaron Schapper, President & CEO at Myers Industries]

I really wanna talk to a lot more of our customers to understand and make sure that we're matching our service with their needs and making sure that we add value. So I think it's a little early. It's a really it's a great question, William, and I I appreciate the question. And I hope that on the next time we speak, that'll have a lot more information for me or for what our customers need and making sure that we match that.

[Bill Dezellem, Founder, President & Chief Investment Officer at Tieton Capital Management]

Great. Thank you. And, Grant, thank you for all the time you've spent with us over the, the last couple of years, and, very best of luck in, whatever the next chapter brings for you.

[Grant Fitz, Executive VP & CFO at Myers Industries]

Well, thanks so much, Bill. It's been great to work with with you and Matt as well too. So

[Operator]

And our next question comes from Anna C. Jolley with Gabelli and Company.

[A. Carolina Jolly, Senior Research Analyst at Gabelli Funds]

Good morning. It's Carolina from Gabelli. Thanks for taking my question. Just first, it's been about a little over a year since you acquired Signature. Can you just talk now that you've had that year under your belt, kind of what's worked, what hasn't, any learnings you found from the acquisitions?

[Grant Fitz, Executive VP & CFO at Myers Industries]

Yeah. Maybe I'll take that one. Good morning, Caroline. It's great to hear hear your voice here. Signature's been a really good acquisition for Myers.

[Grant Fitz, Executive VP & CFO at Myers Industries]

It's, you know, as we've talked before, it's very much been on the business case, that we had, put together when we first acquired the the business. And in fact, you know, one of the things that I think we've learned from this is that Signature had a lot to offer to our business in terms of just some of the processes and the way that they've run some of the some of their operations. And so we've really had some good good learnings on both sides where signatures value, you know, has gotten some improvements with some uptime on some of their equipment through some of the the expertise that we've had in our core businesses. And likewise, we've been able to leverage some of the signature learnings into our core businesses for similar types of of improvements. And just in general, their whole business management system has really been something that we've been really leveraging throughout the company.

[Grant Fitz, Executive VP & CFO at Myers Industries]

The other thing that, you know, was interesting, we did talk about the synergies. We, you know, we've achieved $12,000,000 of synergies with the the business, which is better than the $8,000,000 that we had initially anticipated. It's been driven by a mix of some of the things I talked about as well as we've got some additional resin savings than, what we had originally, anticipated. And so we feel very strong about that business. It's in a very good end market as well too with a lot of good upside potential, and I think, culturally, it's fit in very well with Myers as well.

[Grant Fitz, Executive VP & CFO at Myers Industries]

I do think that, you know, from, just overall learnings, every acquisition is another opportunity for us to learn, and we continue to build on that.

[Aaron Schapper, President & CEO at Myers Industries]

Yeah. And, Caroline, I'll just add from my standpoint. You know, it's a it's a great culture. It's a a a great sales team. It's a great operational team.

[Aaron Schapper, President & CEO at Myers Industries]

And so, you know, as we work through integration, the learnings from signature and the learnings from one another about how we do things just helps the whole. And, you know, when you have a a a really good culture, coming in and integrating, it really just makes Myers a stronger, business. So, like, we're quite happy with the signature signature acquisition, and we're we're quite happy to have, the signature team with Myers, and we'll continue to be able to leverage more from, what they bring to the table.

[A. Carolina Jolly, Senior Research Analyst at Gabelli Funds]

Perfect. Thanks. And then just a last second question. In the press release, you discussed, pricing on the material handling segment. Can you just elaborate a little bit on on the decisions around pricing?

[Daniel Hoehn, VP & Corporate Controller at Myers Industries]

So the the pricing I'm sorry, Caroline. So you're you're asking about pricing, in the in the material handling segment. Correct?

[A. Carolina Jolly, Senior Research Analyst at Gabelli Funds]

Yes.

[Daniel Hoehn, VP & Corporate Controller at Myers Industries]

Yeah. So we did take, some strategic, spots where we adjusted our pricing, to make sure that we were more competitive in the in the market, and and to drive volume.

[Grant Fitz, Executive VP & CFO at Myers Industries]

Yeah. Again, Caroline, we've been You we okay. Thanks, Caroline. I was just gonna say we've we've been, very active on just making sure, and particularly our Acro Mills area that we've, and Buckhorn area that we've been going after any competition that we've had in those areas, and I think we've been very successful with that. So Yeah.

[Aaron Schapper, President & CEO at Myers Industries]

You know? And and just, you know, once the back once again, kinda going back to that is, you know, our customers, you know, they pay for value. And it's really important that when we're going through and we're looking at pricing that we are pricing to the value that we're we're giving. And so I think, you know, that we've had good gross margins and a lot of these businesses, it's really continued to make sure that we press the pricing for the value that we get. And, you know, we've got good relationships with customers.

[Aaron Schapper, President & CEO at Myers Industries]

We've got a long standing relationship with these customers, and I think they value what we bring to the table. So we're just making sure that our pricing, continues to reflect that value, in most everything we do.

[A. Carolina Jolly, Senior Research Analyst at Gabelli Funds]

Thank you.

[Operator]

Thank you. And just as a final reminder, if you would like to ask a question, please press followed by 1 on your telephone keypad. As we currently have no further questions, I will hand back over to Megan Beringer for any final remarks.

[Meghan Beringer, Senior Director of Investor Relations at Myers Industries]

Thank you for joining us today. My contact information is available on the last slide of this deck, so you want to schedule time to continue this conversation. Also, we are attending the KeyBanc Conference in Boston on May 29. We look forward to connecting with you. With that, we will end the call.

[Meghan Beringer, Senior Director of Investor Relations at Myers Industries]

Have a good day.

[Operator]

Thank you. And that concludes today's call. Thank you for joining. You may now disconnect.

Participants

Executives

• Meghan Beringer, Senior Director of Investor Relations
• Aaron Schapper, President & CEO
• Grant Fitz, Executive VP & CFO
• Daniel Hoehn, VP & Corporate Controller

Analysts

• Christian Zyla, Senior Associate Equity Research at KeyBanc Capital Markets
• Bill Dezellem, Founder, President & Chief Investment Officer at Tieton Capital Management
• A. Carolina Jolly, Senior Research Analyst at Gabelli Funds