0001104657false00011046572024-02-152024-02-15

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 15, 2024
MATERION CORPORATION
(Exact name of registrant as specified in its charter)
Ohio 001-15885 34-1919973
(State or other jurisdiction of incorporation or organization)(Commission File Number)(I.R.S. Employer Identification No.)
6070 Parkland Blvd., Mayfield Hts., Ohio 44124
(Address of principal executive offices)(Zip Code)
Registrant's telephone number, including area code (216) 486-4200

Not Applicable
(Former name or former address, if changed since last report)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, no par value MTRN New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§204.12b-2 of this chapter).
Emerging Growth Company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐






Item 2.02 Results of Operations and Financial Condition.

On February 15, 2024, Materion Corporation issued a press release announcing its results for the fourth quarter and full year 2023. The press release is attached hereto as Exhibit 99.1, which is incorporated herein by reference.



Item 9.01 Financial Statements and Exhibits.

Exhibits.
Exhibit NumberDescription of Exhibit
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)













































SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Materion Corporation
February 15, 2024By:
/s/ Shelly M. Chadwick
Shelly M. Chadwick
Vice President, Finance and Chief Financial Officer













































image_2a.jpg
earningsdate2-15x24003a.jpg



Materion Corporation Reports Strong Fourth Quarter and Record Full-Year 2023 Financial Results and Provides 2024 Outlook

MAYFIELD HEIGHTS, Ohio - February 15, 2024 - Materion Corporation (NYSE: MTRN) today reported fourth quarter and record full-year 2023 financial results, provided 2024 earnings guidance and shared an update on key strategic initiatives.

Fourth Quarter 2023 Financial Summary
•Net sales were $421.0 million; value-added sales1 were $289.7 million
•Net income was $19.5 million, or $0.93 per share, diluted, and adjusted earnings of $1.41 per share

Full-Year 2023 Highlights
•Net sales were $1.67 billion; value-added sales were $1.13 billion, a record for the company, up 1% from prior year despite significant semiconductor market weakness
•Net income of $95.7 million, versus $86.0 million in the prior year
•Earnings per share of $4.58, diluted, versus $4.14 in the prior year, and record adjusted earnings of $5.64 per share, versus $5.27 in the prior year, an increase of 7%
•Adjusted EBITDA2 of $217.7 million, or 19.3% of value-added sales, both records for the company, versus $196.0 million, or 17.6% in the prior year, with 170 bps of margin expansion year on year

Newly Announced Customer Partnerships
•Announced three new advancements as we continue to strengthen our organic pipeline
◦Secured a fourth order valued at $36 million to supply critical materials for space propulsion systems
◦Awarded $4 million from a government agency for the development of additive manufacturing processes for advanced materials to serve the Aerospace, Defense and Energy markets
◦Secured another customer contract to supply optical components for LIDAR technologies within NextGen autonomous vehicle applications in Europe

“I am proud of our global team for delivering another record year, despite the significant headwinds facing our largest end market,” Materion President and CEO Jugal Vijayvargiya said. “Our strong performance reflects the power of our diverse megatrend aligned portfolio, which continues to open new pathways for growth, and the importance of our relentless focus on driving operational excellence.”

“We have made remarkable progress expanding our margins, despite market softness,” Vijayvargiya said. “These efforts, combined with the continued strength of our organic pipeline, leave us well-positioned to take advantage of the market recoveries as they develop.”
1


FOURTH QUARTER 2023 RESULTS
Net sales for the quarter were $421.0 million, compared to $434.6 million in the prior year period. Value-added sales were $289.7 million for the quarter, down 4% from prior year due to significant semiconductor market weakness, partially offset by strength in aerospace & defense.

Operating profit for the quarter was $27.6 million and net income was $19.5 million, or $0.93 per diluted share, compared to operating profit of $39.2 million and net income of $28.8 million, or $1.38 per share, in the prior year period.

Excluding special items3 primarily related to targeted cost improvement initiatives and precision clad strip start-up costs, adjusted EBITDA was $53.3 million in the quarter, compared to $55.6 million in the prior year period. The strong performance was driven mainly by focused operational execution and improved mix, despite softer volume.

Adjusted net income was $29.6 million excluding acquisition amortization, or $1.41 per diluted share, compared to $1.49 per share in the prior year period.

FULL-YEAR 2023 RESULTS
Net sales for the year were $1.67 billion, compared to $1.76 billion in the prior year. Value-added sales were $1.13 billion for the year, up 1% from prior year due to strength in aerospace & defense and precision clad strip, offset by softness in several key end markets.

Operating profit for the year was $136.4 million and net income was $95.7 million, or $4.58 per diluted share, compared to operating profit of $119.8 million and net income of $86.0 million, or $4.14 per diluted share, in the prior year.

Excluding special items, adjusted EBITDA for the year was $217.7 million, compared to $196.0 million in the prior year. The increase was driven mainly by strong operational performance, including the targeted cost improvement initiatives, and improved mix driven by new business.

Adjusted net income was $118.0 million excluding acquisition amortization, or $5.64 per diluted share, an increase of 7% compared to $5.27 per diluted share in the prior year.

OUTLOOK
While we expect some of our key end markets to remain challenged in the near term due to macroeconomic conditions, we expect another year of record results driven by our organic pipeline and close customer partnerships. We believe these growth drivers, along with continued operational excellence and targeted cost improvement initiatives, will help drive earnings growth. With this, we are guiding to the range of $6.10 to $6.50 for full year 2024 adjusted earnings per share, an increase of 12% from prior year at the midpoint.

ADJUSTED EARNINGS GUIDANCE
It is not possible for the Company to identify the amount or significance of future adjustments associated with potential insurance and litigation claims, legacy environmental costs, acquisition and integration costs, certain income tax items, or other non-routine costs that the Company adjusts in the presentation of adjusted earnings guidance. These items are dependent on future events that are not reasonably estimable at this time. Accordingly, the Company is unable to reconcile without unreasonable effort the forecasted range of adjusted earnings guidance for the full year to a comparable GAAP range. However, items excluded from the Company's adjusted
2


earnings guidance include the historical adjustments noted in Attachments 4 through 8 to this press release.

CONFERENCE CALL
Materion Corporation will host an investor conference call with analysts at 9:00 a.m. Eastern Time, February 15, 2024. The conference call will be available via webcast through the Company’s website at www.materion.com. By phone, please dial (888) 506-0062. Calls outside the U.S. can dial (973) 528-0011; please reference participant access code of 570395. A replay of the call will be available until February 29, 2024 by dialing (877) 481-4010 or (919) 882-2331 if international; please reference replay ID number 49161. The call will also be archived on the Company’s website.

FOOTNOTES
1 Value-added sales deducts the impact of pass-through metals from net sales
2 EBITDA represents earnings before interest, taxes, depreciation, depletion and amortization
3 Details of the special items can be found in Attachments 4 through 8

ABOUT MATERION
Materion Corporation is a global leader in advanced materials solutions for high-performance industries including semiconductor, industrial, aerospace & defense, energy and automotive. With nearly 100 years of expertise in specialty engineered alloy systems, inorganic chemicals and powders, precious and non-precious metals, beryllium and beryllium composites, and precision filters and optical coatings, Materion partners with customers to enable breakthrough solutions that move the world forward. Headquartered in Mayfield Heights, Ohio, the company employs more than 3,500 talented people worldwide, serving customers in more than 60 countries.

FORWARD-LOOKING STATEMENTS
Portions of the narrative set forth in this document that are not statements of historical or current facts are forward-looking statements. Our actual future performance may materially differ from that contemplated by the forward-looking statements as a result of a variety of factors. These factors include, in addition to those mentioned elsewhere herein: the global economy, including inflationary pressures, potential future recessionary conditions and the impact of tariffs and trade agreements; the impact of any U.S. Federal Government shutdowns or sequestrations; the condition of the markets which we serve, whether defined geographically or by segment; changes in product mix and the financial condition of customers; our success in developing and introducing new products and new product ramp-up rates; our success in passing through the costs of raw materials to customers or otherwise mitigating fluctuating prices for those materials, including the impact of fluctuating prices on inventory values; our success in identifying acquisition candidates and in acquiring and integrating such businesses; the impact of the results of acquisitions on our ability to fully achieve the strategic and financial objectives related to these acquisitions; our success in implementing our strategic plans and the timely and successful start-up and completion of any capital projects; other financial and economic factors, including the cost and availability of raw materials (both base and precious metals), physical inventory valuations, metal consignment fees, tax rates, exchange rates, interest rates, pension costs and required cash contributions and other employee benefit costs, energy costs, regulatory compliance costs, the cost and availability of insurance, credit availability, and the impact of the Company’s stock price on the cost of incentive compensation plans; the uncertainties related to the impact of war, terrorist activities, and acts of God; changes in
3


government regulatory requirements and the enactment of new legislation that impacts our obligations and operations; the conclusion of pending litigation matters in accordance with our expectation that there will be no material adverse effects; the disruptions in operations from, and other effects of, catastrophic and other extraordinary events including outbreaks from infectious diseases and the conflict between Russia and Ukraine and other hostilities; realization of expected financial benefits expected from the Inflation Reduction Act of 2022; and the risk factors set forth in Part 1, Item 1A of the Company's 2022 Annual Report on Form 10-K and in other reports that we file with the SEC.

Investor Contact:
Kyle Kelleher
(216) 383-4931
kyle.kelleher@materion.com

Media Contact:
Jason Saragian
(216) 383-6893
jason.saragian@materion.com
https://materion.com
Mayfield Hts-g
4


Attachment 1
Materion Corporation and Subsidiaries
Consolidated Statements of Income
(Unaudited)

Fourth Quarter EndedYear Ended
(In thousands except per share amounts)December 31, 2023December 31, 2022December 31, 2023December 31, 2022
Net sales$421,043 $434,578 $1,665,187 $1,757,109 
Cost of sales341,328 336,159 1,316,145 1,413,229 
Gross margin79,715 98,419 349,042 343,880 
Selling, general, and administrative expense39,858 46,672 157,911 169,338 
Research and development expense6,442 6,881 27,540 28,977 
Restructuring expense (income)630 13 3,824 1,573 
Other — net5,145 5,662 23,323 24,237 
Operating profit27,640 39,191 136,444 119,755 
Other non-operating (income) expense—net(569)(1,738)(2,710)(5,250)
Interest expense — net8,503 7,580 31,323 21,905 
Income before income taxes19,706 33,349 107,831 103,100 
Income tax (benefit) expense238 4,585 12,129 17,110 
Net income$19,468 $28,764 $95,702 $85,990 
Basic earnings per share:
Net income per share of common stock$0.94 $1.40 $4.64 $4.19 
Diluted earnings per share:
Net income per share of common stock$0.93 $1.38 $4.58 $4.14 
Weighted-average number of shares of common stock outstanding:
Basic20,644 20,537 20,619 20,511 
Diluted20,936 20,790 20,911 20,760 

























5


Attachment 2
Materion Corporation and Subsidiaries
Consolidated Balance Sheets
(Unaudited)

(Thousands)December 31, 2023December 31, 2022
Assets
Current assets
Cash and cash equivalents$13,294 $13,101 
Accounts receivable, net192,747 215,211 
Inventories, net441,597 423,080 
Prepaid and other current assets61,744 39,056 
Total current assets709,382 690,448 
Deferred income taxes4,908 3,265 
Property, plant, and equipment1,281,622 1,209,205 
Less allowances for depreciation, depletion, and amortization(766,939)(760,440)
Property, plant, and equipment—net514,683 448,765 
Operating lease, right-of-use assets57,645 64,249 
Intangible assets133,571 143,219 
Other assets21,664 22,535 
Goodwill320,873 319,498 
Total Assets$1,762,726 $1,691,979 
Liabilities and Shareholders’ Equity
Current liabilities
Short-term debt$38,597 $21,105 
Accounts payable125,663 107,899 
Salaries and wages25,912 35,543 
Other liabilities and accrued items45,773 54,993 
Income taxes5,207 3,928 
Unearned revenue13,843 15,496 
Total current liabilities254,995 238,964 
Other long-term liabilities13,300 12,181 
Operating lease liabilities53,817 59,055 
Finance lease liabilities13,744 13,876 
Retirement and post-employment benefits26,334 20,422 
Unearned income103,983 107,736 
Long-term income taxes3,815 665 
Deferred income taxes20,109 28,214 
Long-term debt387,576 410,876 
Shareholders’ equity885,053 799,990 
Total Liabilities and Shareholders’ Equity$1,762,726 $1,691,979 









6


Attachment 3
Materion Corporation and Subsidiaries
Consolidated Statements of Cash Flows

(Thousands)December 31, 2023December 31, 2022
Cash flows from operating activities:
Net income$95,702 $85,990 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion, and amortization61,644 53,436 
Amortization of deferred financing costs in interest expense1,712 1,734 
Stock-based compensation expense (non-cash)10,092 8,813 
Amortization of pension and post-retirement costs(1,318)(146)
(Gain) loss on sale of property, plant, and equipment 20 14 
Deferred income tax (benefit) expense(7,005)1,733 
Net pension curtailments and settlements142 (551)
Changes in assets and liabilities, net of acquired assets and liabilities:
Decrease (increase) in accounts receivable23,359 (4,377)
Decrease (increase) in inventory(18,700)(63,986)
Decrease (increase) in prepaid and other current assets(22,663)(1,604)
Increase (decrease) in accounts payable and accrued expenses6,631 12,860 
Increase (decrease) in unearned revenue(17,361)207 
Increase (decrease) in interest and taxes payable3,771 154 
Increase (decrease) in unearned income due to customer prepayments16,676 21,942 
Other — net(8,288)(261)
Net cash provided by operating activities144,414 115,958 
Cash flows from investing activities:
Payments for acquisition, net of cash acquired— (2,971)
Payments for purchase of property, plant, and equipment(110,550)(77,608)
Payments for mine development(9,326)— 
Proceeds from sale of property, plant, and equipment654 850 
Net cash used in investing activities(119,222)(79,729)
Cash flows from financing activities:
Proceeds from (repayment of) borrowings under credit facilities, net8,065 230 
Repayment of debt(15,415)(19,299)
Principal payments under finance lease obligations(1,645)(2,736)
Cash dividends paid(10,621)(10,160)
Payments of withholding taxes for stock-based compensation awards(5,234)(3,593)
Net cash provided by (used in) financing activities(24,850)(35,558)
Effects of exchange rate changes(149)(2,032)
Net change in cash and cash equivalents193 (1,361)
Cash and cash equivalents at beginning of period13,101 14,462 
Cash and cash equivalents at end of period$13,294 $13,101 



7


Attachment 4
Materion Corporation and Subsidiaries
Reconciliation of Non-GAAP Measure - Value-added Sales, Operating Profit, and EBITDA
(Unaudited)
Fourth Quarter EndedYear Ended
(Millions)December 31, 2023December 31, 2022December 31, 2023December 31, 2022
Net Sales
Performance Materials$201.1 $197.6 $755.5 $671.5 
Electronic Materials193.9 209.3 805.8 971.9 
Precision Optics26.0 27.7 103.9 113.7 
Other— — — — 
Total$421.0 $434.6 $1,665.2 $1,757.1 
 Less: Pass-through Metal Cost
Performance Materials$15.1 $20.0 $66.9 $82.0 
Electronic Materials116.2 111.5 471.1 559.1 
Precision Optics— — 0.1 0.1 
Other— 0.1 — 1.5 
Total$131.3 $131.6 $538.1 $642.7 
 Value-added Sales (non-GAAP)
Performance Materials$186.0 $177.6 $688.6 $589.5 
Electronic Materials77.7 97.8 334.7 412.8 
Precision Optics26.0 27.7 103.8 113.6 
Other— (0.1)— (1.5)
Total$289.7 $303.0 $1,127.1 $1,114.4 
Gross Margin
Performance Materials(1)
$50.5 $57.7 $216.5 $175.1 
Electronic Materials(1)
21.5 31.5 100.4 131.5 
Precision Optics(1)
7.7 9.2 32.1 37.3 
Other— — — — 
 Total(1)
$79.7 $98.4 $349.0 $343.9 
(1) See reconciliation of gross margin to adjusted gross margin in Attachment 8
Note: Quarterly information presented within this document and previously disclosed quarterly information may not equal the total computed for the year due to rounding

8


Fourth Quarter EndedYear Ended
(Millions)December 31, 2023December 31, 2022December 31, 2023December 31, 2022
Operating Profit (Loss)
Performance Materials$33.0 $37.6 $143.9 $101.4 
Electronic Materials3.8 12.3 28.6 51.3 
Precision Optics(0.4)1.1 (2.0)1.9 
Other(8.8)(11.8)(34.1)(34.8)
 Total$27.6 $39.2 $136.4 $119.8 
Non-Operating (Income) Expense
Performance Materials$0.2 $0.1 $0.6 $0.5 
Electronic Materials(0.1)— (0.1)— 
Precision Optics— (0.6)(0.6)(1.3)
Other(0.7)(1.2)(2.7)(4.4)
 Total$(0.6)$(1.7)$(2.8)$(5.2)
Depreciation, Depletion, and Amortization
Performance Materials$7.6 $6.8 $31.2 $24.3 
Electronic Materials4.3 4.2 17.0 16.5 
Precision Optics2.6 2.7 11.3 10.5 
Other0.6 0.5 2.1 2.1 
Total$15.1 $14.2 $61.6 $53.4 
Segment EBITDA
Performance Materials$40.4 $44.3 $174.5 $125.2 
Electronic Materials8.2 16.5 45.7 67.8 
Precision Optics2.2 4.4 9.9 13.7 
Other(7.5)(10.1)(29.3)(28.3)
Total$43.3 $55.1 $200.8 $178.4 
Special Items(2)
Performance Materials$5.6 $— $6.7 $6.8 
Electronic Materials2.8 0.6 7.3 8.2 
Precision Optics1.6 (0.4)2.8 0.3 
Other— 0.3 0.1 2.3 
 Total$10.0 $0.5 $16.9 $17.6 
Adjusted EBITDA Excluding Special Items
Performance Materials$46.0 $44.3 $181.2 $132.0 
Electronic Materials11.0 17.1 53.0 76.0 
Precision Optics3.8 4.0 12.7 14.0 
Other(7.5)(9.8)(29.2)(26.0)
 Total$53.3 $55.6 $217.7 $196.0 

The cost of gold, silver, platinum, palladium, copper, ruthenium, iridium, rhodium, rhenium, and osmium is passed through to customers and, therefore, the trends and comparisons of net sales are affected by movements in the market price of these metals. Internally, management also reviews net sales on a value-added basis. Value-added sales is a non-GAAP financial measure that deducts the value of the pass-through metals sold from net sales. Value-added sales allows management to assess the impact of differences in net sales between periods or segments and analyze the resulting margins and profitability without the distortion of the movements in pass-through market metal prices. The dollar amount of gross margin and operating profit is not affected by the value-added sales calculation. The Company sells other metals and materials that are not considered direct pass throughs, and these costs are not deducted from net sales to calculate value-added sales.
The Company’s pricing policy is to pass the cost of these metals on to customers in order to mitigate the impact of price volatility on the Company’s results from operations. Value-added information is being presented since changes in metal prices may not directly impact profitability. It is the Company’s intent to allow users of the financial statements to review sales with and without the impact of the pass-through metals.
(2) See additional details of special items in Attachment 5.
9


Attachment 5
Materion Corporation and Subsidiaries
Reconciliation of Net Sales to Value-added Sales, Net Income to EBITDA and Adjusted EBITDA
(Unaudited)
Fourth Quarter EndedTwelve Months Ended
(Millions)December 31, 2023% of VADecember 31, 2022% of VADecember 31, 2023% of VADecember 31, 2022% of VA
Net sales$421.0 $434.6 $1,665.2 $1,757.1 
Pass-through metal cost131.3 131.6 538.1 642.7 
Value-added sales$289.7 $303.0 $1,127.1 $1,114.4 
Net income$19.5 6.7 %$28.8 9.5 %$95.7 8.5 %$86.0 7.7 %
Income tax expense0.2 0.1 %4.5 1.5 %12.2 1.1 %17.1 1.5 %
Interest expense - net8.5 2.9 %7.6 2.5 %31.3 2.8 %21.9 2.0 %
Depreciation, depletion and amortization15.1 5.2 %14.2 4.7 %61.6 5.5 %53.4 4.8 %
Consolidated EBITDA$43.3 14.9 %$55.1 18.2 %$200.8 17.8 %$178.4 16.0 %
Special items
Restructuring and cost reduction$4.2 1.4 %$— — %$11.1 1.0 %$1.5 0.1 %
Pension settlement0.2 0.1 %(0.5)(0.2)%0.2 — %(0.5)— %
Additional start up resources and scrap5.6 1.9 %— — %5.6 0.5 %4.1 0.4 %
Merger and acquisition costs— — %1.0 0.3 %— — %12.5 1.1 %
Total special items10.0 3.5 %0.5 0.2 %16.9 1.5 %17.6 1.6 %
Adjusted EBITDA$53.3 18.4 %$55.6 18.3 %$217.7 19.3 %$196.0 17.6 %
In addition to presenting financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP), this earnings release contains financial measures, including operating profit, segment operating profit, earnings before interest, taxes, depreciation, depletion and amortization (EBITDA), net income, and earnings per share, on a non-GAAP basis. As detailed in the above reconciliation and Attachment 6, we have adjusted the results for certain special items such as restructuring and cost reductions (which includes costs associated with temporarily idled facilities as a result of decreased demand), additional start up resources and scrap and merger and acquisition costs. Internally, management reviews the results of operations without the impact of these costs in order to assess the profitability from ongoing activities. We are providing this information because we believe it will assist investors in analyzing our financial results and, when viewed in conjunction with the GAAP results, provide a more comprehensive understanding of the factors and trends affecting our operations.

10


Attachment 6
Materion Corporation and Subsidiaries
Reconciliation of Net Income to Adjusted Net Income
and Diluted Earnings per Share to Adjusted Diluted Earnings per Share (Unaudited)
Fourth Quarter EndedTwelve Months Ended
(Millions)December 31, 2023Diluted EPSDecember 31, 2022Diluted EPSDecember 31, 2023Diluted EPSDecember 31, 2022Diluted EPS
Net income and EPS$19.5 $0.93 $28.8 $1.38 $95.7 $4.58 $86.0 $4.14 
Special items
Restructuring and cost reduction4.2 — 11.1 1.5 
Additional start up resources and scrap5.6 — 5.6 4.1 
Merger and acquisition costs— 1.0 — 12.5 
Pension settlement0.2 (0.5)0.2 (0.5)
Provision for income taxes (1)
(2.4)(0.8)(4.4)(3.9)
Total special items7.6 0.36 (0.3)(0.01)12.5 0.60 13.7 0.66 
Adjusted net income and adjusted EPS$27.1 $1.29 $28.5 $1.37 $108.2 $5.17 $99.7 $4.80 
Acquisition amortization (net of tax)2.5 0.12 2.4 0.12 9.8 0.47 9.8 0.47
Adjusted net income and adjusted EPS excl. amortization$29.6 $1.41 $30.9 $1.49 $118.0 $5.64 $109.5 $5.27 
(1) Provision for income taxes includes the net tax impact on pre-tax adjustments (listed above), the impact of certain discrete tax items recorded during the respective periods as well as other adjustments to reflect the use of one overall effective tax rate on adjusted pre-tax income in interim periods.























11


Attachment 7
Reconciliation of Segment Net sales to Segment Value-added sales and Segment EBITDA to Adjusted Segment EBITDA (Unaudited)
Performance Materials
Fourth Quarter EndedTwelve Months Ended
(Millions)December 31, 2023% of VADecember 31, 2022% of VADecember 31, 2023% of VADecember 31, 2022% of VA
Net sales$201.1 $197.6 $755.5 $671.5 
Pass-through metal cost15.1 20.0 66.9 82.0 
Value-added sales$186.0 $177.6 $688.6 $589.5 
EBITDA$40.4 21.7 %$44.3 24.9 %$174.5 25.3 %$125.2 21.2 %
Restructuring and cost reduction— — %— — %1.1 0.2 %— — %
Additional start up resources and scrap5.6 3.0 %— — %5.6 0.8 %4.1 0.7 %
Merger and acquisition costs— — %— — %— — %2.7 0.5 %
Adjusted EBITDA$46.0 24.7 %$44.3 24.9 %$181.2 26.3 %$132.0 22.4 %
Electronic Materials
Fourth Quarter EndedTwelve Months Ended
(Millions)December 31, 2023% of VADecember 31, 2022% of VADecember 31, 2023% of VADecember 31, 2022% of VA
Net sales$193.9 $209.3 $805.8 $971.9 
Pass-through metal cost116.2 111.5 471.1 559.1 
Value-added sales$77.7 $97.8 $334.7 $412.8 
EBITDA$8.2 10.6 %$16.5 16.9 %$45.7 13.7 %$67.8 16.4 %
Restructuring and cost reduction2.8 3.6 %— — %7.3 2.2 %0.8 0.2 %
Merger and acquisition costs— — %0.6 0.6 %— — %7.4 1.8 %
Adjusted EBITDA$11.0 14.2 %$17.1 17.5 %$53.0 15.8 %$76.0 18.4 %
Precision Optics
Fourth Quarter EndedTwelve Months Ended
(Millions)December 31, 2023% of VADecember 31, 2022% of VADecember 31, 2023% of VADecember 31, 2022% of VA
Net sales$26.0 $27.7 $103.9 $113.7 
Pass-through metal cost— — 0.1 0.1 
Value-added sales$26.0 $27.7 $103.8 $113.6 
EBITDA$2.2 8.5 %$4.4 15.9 %$9.9 9.5 %$13.7 12.1 %
Restructuring and cost reduction1.4 5.4 %— — %2.6 2.5 %0.6 0.5 %
Pension settlement0.2 0.8 %(0.5)(1.8)%0.2 0.2 %(0.5)(0.4)%
Merger and acquisition costs— — %0.1 0.4 %— — %0.2 0.2 %
Adjusted EBITDA$3.8 14.7 %$4.0 14.4 %$12.7 12.2 %$14.0 12.3 %
Other
Fourth Quarter EndedTwelve Months Ended
(Millions)December 31, 2023% of VADecember 31, 2022% of VADecember 31, 2023% of VADecember 31, 2022% of VA
EBITDA$(7.5)$(10.1)$(29.3)$(28.3)
Restructuring and cost reduction— — 0.1 0.1 
   Merger and acquisition costs— 0.3 — 2.2 
Adjusted EBITDA$(7.5)$(9.8)$(29.2)$(26.0)
12


Attachment 8
Materion Corporation and Subsidiaries
Reconciliation of Non-GAAP Measure - Gross Margin to Adjusted Gross Margin
(Unaudited)
Fourth Quarter EndedTwelve Months Ended
(Millions)December 31, 2023December 31, 2022December 31, 2023December 31, 2022
Gross Margin
Performance Materials$50.5 $57.7 $216.5 $175.1 
Electronic Materials21.5 31.5 100.4 131.5 
Precision Optics7.7 9.2 32.1 37.3 
Other— — — — 
Total$79.7 $98.4 $349.0 $343.9 
Special Items (1)
Performance Materials$5.6 $— $6.4 $6.7 
Electronic Materials1.5 — 3.9 5.0 
Precision Optics1.0 — 1.3 — 
Other— — — — 
Total$8.1 $— $11.6 $11.7 
Adjusted Gross Margin
Performance Materials$56.1 $57.7 $222.9 $181.8 
Electronic Materials23.0 31.5 104.3 136.5 
Precision Optics8.7 9.2 33.4 37.3 
Other— — — — 
Total$87.8 $98.4 $360.6 $355.6 
(1) Special items impacting gross margin represent restructuring and cost reduction and additional start up resources and scrap in 2023 and merger and acquisition costs in 2022.
13

v3.24.0.1
Cover
Feb. 15, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 15, 2024
Entity Registrant Name MATERION CORPORATION
Entity Incorporation, State or Country Code OH
Entity File Number 001-15885
Entity Tax Identification Number 34-1919973
Entity Address, Address Line One 6070 Parkland Blvd.
Entity Address, City or Town Mayfield Hts.
Entity Address, State or Province OH
Entity Address, Postal Zip Code 44124
City Area Code 216
Local Phone Number 486-4200
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, no par value
Trading Symbol MTRN
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0001104657
Amendment Flag false
Materion (NYSE:MTRN)
Historical Stock Chart
From Mar 2024 to Apr 2024 Click Here for more Materion Charts.
Materion (NYSE:MTRN)
Historical Stock Chart
From Apr 2023 to Apr 2024 Click Here for more Materion Charts.