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Advanced Drainage Systems, Inc. (WMS) SEC Filing 10-K Annual Report for the fiscal year ending Thursday, March 31, 2022

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WMS Annual Reports

Advanced Drainage Systems, Inc.

CIK: 1604028 Ticker: WMS
Exhibit 99.1
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ADVANCED DRAINAGE SYSTEMS ANNOUNCES FOURTH QUARTER AND
FISCAL YEAR 2022 RESULTS
HILLIARD, Ohio – (May 19, 2022) – Advanced Drainage Systems, Inc. (NYSE: WMS) (“ADS” or the “Company”), a leading provider of innovative water management solutions in the stormwater and on-site septic waste water industries today announced financial results for the fourth quarter and fiscal year ended March 31, 2022.
Fourth Quarter Fiscal 2022 Results
Net sales increased 52.8% to $678.2 million
Net income increased 126.8% to $47.1 million
Adjusted EBITDA (Non-GAAP) increased 78.2% to $168.5 million
Fiscal 2022 Results
Net sales increased 39.7% to $2,769.3 million
Net income increased 21.6% to $275.0 million
Adjusted EBITDA (Non-GAAP) increased 19.2% to $676.0 million
Cash provided by operating activities of $274.9 million
Free cash flow (Non-GAAP) of $125.8 million
Scott Barbour, President and Chief Executive Officer of ADS commented, "We achieved another quarter of record revenue and Adjusted EBITDA results in the fourth quarter of fiscal 2022. Sales growth of 53% was driven by favorable pricing at both ADS and Infiltrator, as well as volume growth in the domestic construction markets. We capitalized on strong demand across our product portfolio and geographic footprint, particularly in priority states such as Florida, Texas and California. Leading indicators support continued strength in demand through the calendar year as we work through a strong backlog."

Barbour continued, "The favorable top line growth we achieved in the fourth quarter offset inflationary cost pressure on materials, transportation and labor. We continue to see pressure from labor shortages, and absenteeism related to the COVID variant impacted our manufacturing and transportation operations early in the fourth quarter. The actions we took previously to simplify production processes and increase production rates have been successful, improving service levels to customers overall."

Barbour concluded, "In summary, fiscal 2022 played out largely as we communicated, with profit improvement occurring in the second half of the year as the multiple actions we took to improve pricing and operations were successful. Our demand environment, strong backlog, favorable pricing and progress on the continuous improvement initiatives give us confidence in the guidance being issued today for fiscal year 2023. Backlog levels remain elevated, up double-digits over the prior year but down from fiscal 2022 peaks as a result of capacity additions and improved service levels. We are closely monitoring our end markets, staying close to our distribution partners, and will stay focused on executing the fiscal 2023 plan."
Fourth Quarter Fiscal 2022 Results
Net sales increased $234.4 million, or 52.8%, to $678.2 million, as compared to $443.8 million in the prior year quarter. Domestic pipe sales increased $157.5 million, or 65.8%, to $396.7 million. Domestic allied products & other sales increased $51.2 million, or 52.3%, to $149.1 million. Infiltrator sales increased $39.3 million, or 43.1%, to $130.6 million. These increases were driven by double-digit sales growth in the U.S. construction end markets. International sales increased $5.6 million, or 16.3%, to $40.0 million.
Gross profit increased $63.0 million, or 49.5%, to $190.2 million as compared to $127.2 million in the prior year. The increase in gross profit is primarily due to the increase in sales volume and favorable pricing on pipe, on-site septic and allied products. These increases were partially offset by inflationary cost pressure on materials, transportation and labor, as well as an increase in the use of third-party logistics services. Labor shortages and absenteeism related to COVID-19 remain a challenge in both manufacturing and transportation operations. In addition, the Company recorded $19.2 million of non-cash, stock-based compensation expense in Cost of goods sold - ESOP acceleration expense as described below under the heading "Employee Stock Ownership Plan (ESOP)".
Adjusted EBITDA (Non-GAAP) increased $74.0 million, or 78.2%, to $168.5 million, as compared to $94.5 million in the prior year. The increase is primarily due to the factors mentioned above. As a percentage of net sales, Adjusted EBITDA was 24.8% as compared to 21.3% in the prior year.
1

The following information was filed by Advanced Drainage Systems, Inc. (WMS) on Thursday, May 19, 2022 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Advanced Drainage Systems, Inc.'s 10-K Annual Report:

Financial Statements, Disclosures and Schedules

Inside this 10-K Annual Report

Audit Information
Cover
Consolidated Balance Sheets
Consolidated Balance Sheets (Parenthetical)
Consolidated Statements Of Cash Flows
Consolidated Statements Of Comprehensive Income (Loss)
Consolidated Statements Of Operations
Consolidated Statements Of Stockholders' Equity And Mezzanine Equity
Consolidated Statements Of Stockholders' Equity And Mezzanine Equity (Parenthetical)
Acquisitions
Acquisitions (Tables)
Acquisitions - Additional Information (Detail)
Acquisitions - Summary Of Consideration Transferred And Preliminary Purchase Price Allocation Of Assets Acquired And Liabilities Assumed (Detail)
Acquisitions - Summary Of Identifiable Intangible Assets (Detail)
Acquisitions - Summary Of Unaudited Pro Forma Information (Detail)
Background And Summary Of Significant Accounting Policies
Background And Summary Of Significant Accounting Policies (Policies)
Background And Summary Of Significant Accounting Policies (Tables)
Background And Summary Of Significant Accounting Policies - Additional Information (Detail)
Background And Summary Of Significant Accounting Policies - Estimated Useful Lives Of Related Assets (Detail)
Background And Summary Of Significant Accounting Policies - Summary Of Receivables (Detail)
Business Segment Information
Business Segment Information (Tables)
Business Segment Information - Additional Information (Detail)
Business Segment Information - Net Sales And Long-Lived Asset By Geographic Location (Detail)
Business Segment Information - Reconciliation Of Gross Profit To Segment Adjusted Gross Profit (Detail)
Business Segment Information - Schedule Of Financial Information Attributable To Reportable Segments (Detail)
Business Segment Information - Schedule Of Revenue From Reportable Segments By Product Type (Detail)
Commitments And Contingencies
Commitments And Contingencies - Additional Information (Detail)
Debt
Debt (Tables)
Debt - Additional Information (Detail)
Debt - Long-Term Debt (Detail)
Debt - Maturities Of Long-Term Debt (Excluding Interest And Deferred Financing Costs) (Detail)
Employee Benefit Plans
Employee Benefit Plans (Tables)
Employee Benefit Plans - Additional Information (Detail)
Employee Benefit Plans - Esop Compensation Expense (Detail)
Employee Benefit Plans - Summarized Cash And Stock Dividends On Allocated Redeemable Convertible Preferred Stock (Detail)
Fair Value Measurement And Derivative Transactions
Fair Value Measurement And Derivative Transactions (Tables)
Fair Value Measurement And Derivative Transactions - Derivative Fair Values (Detail)
Fair Value Measurement And Derivative Transactions - Schedule Of Cash Settlements And Net (Gains) And Net Losses On Mark-To-Market Adjustments For Changes In Fair Value Of Derivative Contracts (Details)
Fair Value Measurement And Derivative Transactions - Summary Of Assets And Liabilities Carried At Fair Value (Detail)
Fair Value Measurement And Derivative Transactions - Summary Of Carrying And Fair Value Of Senior Notes (Detail)
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Tables)
Goodwill And Intangible Assets - Carrying Amount Of Goodwill By Reportable Segment (Detail)
Goodwill And Intangible Assets - Future Intangible Asset Amortization Expense (Detail)
Goodwill And Intangible Assets - Schedule Of Amortization Expense And Weighted Average Amortization Period For Definite-Lived Intangible Assets (Detail)
Goodwill And Intangible Assets - Summary Of Intangible Assets (Detail)
Income Taxes
Income Taxes (Tables)
Income Taxes - Additional Information (Detail)
Income Taxes - Components Of Income Before Income Taxes (Detail)
Income Taxes - Components Of Income Tax Expense (Detail)
Income Taxes - Deferred Tax Assets And Deferred Tax Liabilities (Detail)
Income Taxes - Net Deferred Tax Assets And Liabilities (Detail)
Income Taxes - Reconciliation Of Effective Tax Rate And Statutory Federal Income Tax Rate (Detail)
Income Taxes - Unrecognized Tax Benefits (Detail)
Inventories
Inventories (Tables)
Inventories - Additional Information (Detail)
Inventories - Schedule Of Inventories (Detail)
Investment In Affiliates
Investment In Affiliates (Tables)
Investment In Affiliates - Additional Information (Detail)
Investment In Affiliates - Assets And Liabilities Of Joint Ventures (Detail)
Leases
Leases (Tables)
Leases - Additional Information (Detail)
Leases - Schedule Of Components Of Lease Cost (Detail)
Leases - Schedule Of Future Minimum Lease Payments On Rolling Twelve-Month Basis Under Operating And Finance Leases (Detail)
Leases - Schedule Of Supplemental Balance Sheet Information Related To Leases (Detail)
Leases - Schedule Of Supplemental Cash Flow Information Related To Leases (Detail)
Net Income Per Share And Stockholders' Equity
Net Income Per Share And Stockholders' Equity (Tables)
Net Income Per Share And Stockholders' Equity - Additional Information (Detail)
Net Income Per Share And Stockholders' Equity - Summary Of Net Income Per Share (Detail)
Other Accrued Liabilities
Other Accrued Liabilities (Tables)
Other Accrued Liabilities - Schedule Of Other Accrued Liabilities (Detail)
Property, Plant And Equipment
Property, Plant And Equipment (Tables)
Property, Plant And Equipment - Depreciation Expense Related To Property, Plant And Equipment (Detail)
Property, Plant And Equipment - Schedule Of Property, Plant And Equipment (Detail)
Related Party Transactions
Related Party Transactions - Additional Information (Detail)
Revenue Recognition
Revenue Recognition (Tables)
Revenue Recognition - Schedule Of Contract Asset And Liability (Detail)
Schedule Ii - Consolidated Valuation And Qualifying Accounts
Schedule Ii - Consolidated Valuation And Qualifying Accounts (Detail)
Stock-Based Compensation
Stock-Based Compensation (Tables)
Stock-Based Compensation - 2008 Restricted Stock Plan (Details)
Stock-Based Compensation - 2017 Omnibus Plan (Details)
Stock-Based Compensation - Schedule Of Stock Option Activity (Details)
Stock-Based Compensation - Stock Options (Details)
Stock-Based Compensation - Summary Of Assumption Used In Estimate Fair Value Of Stock Options (Details)
Stock-Based Compensation - Summary Of Performance Units Granted (Details)
Stock-Based Compensation - Summary Of Stock-Based Compensation Expense (Details)
Stock-Based Compensation - Summary Of Unvested Restricted Stock Grants (Details)
Subsequent Events
Subsequent Events - Additional Information (Detail)
Supplemental Disclosures Of Cash Flow Information
Supplemental Disclosures Of Cash Flow Information (Tables)
Supplemental Disclosures Of Cash Flow Information - Supplemental Disclosures Cash Flow Information (Detail)
Ticker: WMS
CIK: 1604028
Form Type: 10-K Annual Report
Accession Number: 0001604028-22-000025
Submitted to the SEC: Thu May 19 2022 4:13:22 PM EST
Accepted by the SEC: Thu May 19 2022
Period: Thursday, March 31, 2022
Industry: Plastics Foam Products

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