Business Overview and History
Myers Industries, Inc. (MYE) is a leading manufacturer of a diverse range of plastic, metal, and rubber products, as well as a major distributor of tools, equipment, and supplies for the tire, wheel, and under-vehicle service industry. The company's roots trace back to 1933 when it was founded as a small storefront distributing tire service supplies. Over the decades, Myers Industries has evolved into an international manufacturing and distribution enterprise, going public in 1971 and listing its stock on the New York Stock Exchange.
Myers Industries operates in two reportable segments: Material Handling and Distribution. The Material Handling segment manufactures a broad selection of durable plastic reusable products, including containers, pallets, bins, and tanks used in a variety of industrial, agricultural, and consumer applications. The Distribution segment is engaged in the distribution of equipment, tools, and supplies for tire servicing and automotive under-vehicle repair, as well as the manufacture of tire repair and retreading products.
The company has expanded its capabilities over the years through strategic acquisitions. In 2024, Myers Industries acquired Signature Systems, a leading manufacturer and distributor of composite ground protection matting. This acquisition aligned with the company's long-term strategy to transform into a high-growth, customer-centric innovator of value-added engineered plastic solutions. Prior to that, in 2022, Myers Industries acquired Mohawk Rubber Sales, a leading auto aftermarket distributor, to optimize and grow its Distribution business.
Throughout its history, Myers Industries has faced various challenges, including adapting to changes in technology, regulatory requirements, and competitive processes to maintain its market position. The company has also had to navigate through economic cycles and industry consolidation. Despite these challenges, Myers Industries has successfully grown from a small regional player to an international manufacturing and distribution enterprise with a strong portfolio of brands and products.
The company's product range has expanded significantly since its inception. Myers Industries now designs, manufactures, and markets a variety of plastic, metal, and rubber products. These include plastic reusable containers, pallets, small parts bins, bulk shipping containers, storage and organization products, OEM parts, custom plastic products, composite ground protection matting, consumer fuel containers, and tanks for water, fuel, and waste handling.
Financial Performance and Ratios
For the full year 2024, Myers Industries reported net sales of $836.3 million, an increase of 2.9% compared to the prior year. Adjusted operating income improved by $8.4 million, or 11.1%, year-over-year. Adjusted EBITDA increased $24.2 million, or 24.7%, with the adjusted EBITDA margin expanding 250 basis points to 14.6%. The company's diluted adjusted earnings per share for 2024 was $1.04.
Looking at key financial ratios, Myers Industries' 2024 gross profit margin was 32.4%, up from 31.9% in the prior year. The company's operating profit margin increased to 5.4% in 2024 from 5.0% in 2023. Its return on assets stood at 0.84% in 2024, while its return on equity was 2.5%. Myers Industries maintained a relatively strong balance sheet, with a debt-to-equity ratio of 1.49 and a current ratio of 1.76 as of the end of 2024.
For the most recent fiscal year (2024), Myers Industries reported annual revenue of $836.28 million, annual net income of $7.20 million, annual operating cash flow of $79.29 million, and annual free cash flow of $54.86 million. In the most recent quarter (Q4 2024), the company reported revenue of $203.88 million, net income of $4.30 million, with quarterly operating cash flow and free cash flow figures not available.
Year-over-year, Q4 2024 revenue increased 6.7%, driven by 33% growth in the consumer end market and 13% growth in the industrial end market, partially offset by lower seed box volume in the food and beverage end market and a 20.2% decrease in the Distribution segment. Adjusted gross margin increased 210 basis points to 32.2% due to the Signature acquisition and favorable product mix, partially offset by lower pricing and volume.
In terms of liquidity, Myers Industries had $32.2 million in cash and $244.7 million available under its Amended Loan Agreement as of December 31, 2024. The Amended Loan Agreement has a $250 million borrowing limit and matures in September 2027. The company's quick ratio stood at 1.10.
Segmental Performance
The Material Handling segment, which accounted for 74.3% of the company's 2024 revenue, saw its net sales increase 20.3% year-over-year. This growth was driven by the Signature Systems acquisition, as well as strong sales of Scepter's military ammunition packaging and consumer fuel containers. The segment's adjusted EBITDA margin improved 30 basis points to 22.7%.
The Material Handling Segment manufactures a broad selection of durable plastic reusable products that are used repeatedly during the course of their service life. These highly sustainable products can be recovered, recycled, and reprocessed into new products at the end of their service life. The segment's product portfolio includes plastic reusable containers, pallets, small parts bins, bulk shipping containers, storage and organization products, OEM parts, custom plastic products, composite ground protection matting, consumer fuel containers, and tanks for water, fuel and waste handling. The products in this segment are primarily manufactured through injection molding, rotational molding, compression molding or blow molding processes.
The Material Handling Segment conducts its primary operations in the United States and Canada, but also exports globally. It serves a wide variety of markets, including industrial manufacturing, food processing, retail/wholesale products distribution, agriculture, automotive, recreational vehicles, marine vehicles, healthcare, appliance, bakery, electronics, textiles, construction, infrastructure and consumer. The segment's products are sold both directly to end-users and through distributors.
In 2024, the Material Handling Segment generated net sales of $621.65 million, an increase of 12% compared to the prior year. This growth was driven by $102.7 million in incremental sales from the acquisition of Signature Systems on February 8, 2024. Gross profit for the Material Handling Segment increased by 4.5% to $270.81 million in 2024, with a gross margin of 32.4%. The improved profitability was due to the benefits from the Signature acquisition, favorable product mix, and the company's ongoing productivity initiatives, partially offset by lower volume, pricing pressures, and the impact of acquisition-related inventory step-up amortization.
The Distribution segment, which contributed 25.7% of 2024 revenue, experienced a 20.2% decline in net sales due to lower volume and pricing. Adjusted EBITDA for the Distribution segment decreased $1.5 million to a loss of $0.3 million, primarily due to the lower gross margin, partially offset by lower SG&A expenses.
The Distribution Segment is engaged in the distribution of equipment, tools, and supplies used for tire servicing and automotive under-vehicle repair, as well as the manufacture of tire repair and retreading products. The segment's product portfolio includes tire valves and accessories, tire changing and balancing equipment, lifts and alignment equipment, service equipment and tools, and tire repair and retread supplies. It also manufactures and sells certain traffic markings, including reflective highway marking tape.
The Distribution Segment operates domestically through its regional and customer-focused sales team with strategically located regional distribution centers in the United States. It also exports globally and has branch operations in certain Central American countries. The segment serves a variety of customers, including retail and truck tire dealers, commercial auto and truck fleets, truck stop operations, auto dealers, general service and repair centers, tire retreaders, and government agencies.
In 2024, the Distribution Segment reported net sales of $214.77 million, a decrease of 16.7% compared to the prior year. This decline was primarily driven by lower sales volume of $38.1 million and lower pricing of $5 million amidst the challenging macroeconomic environment. Gross profit for the Distribution Segment was $55.04 million, with a gross margin of 25.6%.
Risks and Challenges
Like many industrial companies, Myers Industries faces risks related to fluctuations in raw material prices, particularly plastic resins. The company's ability to manage its cost structure can be adversely affected by movements in commodity and other raw material prices. Additionally, the company operates in highly competitive markets, which could affect its financial condition and results of operations.
The Distribution segment has also faced some integration challenges following the Mohawk acquisition, with the company making management changes and working to optimize the cost structure of this business. Myers Industries is actively addressing these issues as part of its "Focused Transformation" initiative.
Outlook and Growth Initiatives
To drive improved performance, Myers Industries has launched a "Focused Transformation" program under the leadership of new CEO Aaron Schapper, who joined the company in January 2025. The program is designed to establish a culture of execution and accountability, develop clear strategies to improve the profitability of each business unit, deliver consistent and reliable results through cost control, and implement a disciplined capital allocation framework.
As part of the Focused Transformation, Myers Industries has announced plans to deliver $20 million in annualized cost savings, primarily in SG&A, by the end of 2025. The company is also committing to a new $10 million share repurchase program to complement its ongoing dividend payments, reflecting its confidence in the strength of the business and commitment to return cash to shareholders.
Looking ahead, Myers Industries sees opportunities for continued growth in its Signature Systems infrastructure business, as well as its Scepter military and consumer fuel container products. The company also expects stability in its vehicle end market and low single-digit growth in its bulk container and organizational products businesses. While the Distribution segment will continue to face challenges, the company is working to optimize its cost structure and improve profitability in this part of the business.
Myers Industries has temporarily suspended its practice of issuing formal annual guidance as it focuses on the Focused Transformation program. However, the company provided some high-level qualitative expectations for 2025, including continued growth in the Signature Systems business with strong infrastructure project spending, low single-digit growth in bulk containers and organizational products, a low single-digit revenue decline in fuel container sales in the consumer end market, and a flat food and beverage end market, including agriculture. The automotive aftermarket (Distribution segment) is expected to continue stabilizing as the company improves its cost structure.
Myers Industries stated that it is encouraged by the overall sales trajectory of the business and confident in its ability to continue driving margin improvement in 2025. The company intends to resume providing formal annual guidance as soon as possible after completing the Focused Transformation actions.
Geographic Performance
Myers Industries has operations in the United States, Canada, and Central America. In 2024, international net sales accounted for approximately 6% of total net sales, highlighting the company's strong domestic presence while also maintaining a foothold in international markets.
Conclusion
Myers Industries has a rich history as a diversified industrial manufacturer and distributor, with a portfolio of strong brands and innovative products. The company is now embarking on a focused transformation initiative to drive improved financial performance and create value for shareholders. While facing some near-term headwinds, particularly in its Distribution segment, Myers Industries appears well-positioned to capitalize on growth opportunities in its core Material Handling businesses and deliver consistent, reliable results through disciplined operational and financial management. The company's diverse product portfolio across the Material Handling and Distribution segments serves a wide range of industrial, commercial, and consumer markets. Myers Industries' strategic focus on innovation, operational excellence, and strategic acquisitions, such as Signature Systems, positions it to navigate the current economic conditions and continue driving long-term growth and profitability. Investors would be wise to closely monitor the company's progress as it executes on its strategic priorities and Focused Transformation program.