Outlook
Third Quarter 2022
The company expects third quarter 2022 adjusted net sales to increase 2% to 4% compared to the third quarter of 2021. This expectation includes an approximately 2 point additive impact from recently acquired businesses, and an approximately 3 point negative impact from foreign currency translation.
Adjusted EBITDA margin for the third quarter of 2022 is expected to be approximately 22%, which includes approximately $45 million of premium supply chain costs. Non-GAAP earnings per diluted share are expected to be in the range of $4.35 to $4.65. This assumes an adjusted effective tax rate of approximately 18%.
Full Year 2022
The Company is narrowing the range of its full year outlook for adjusted net sales growth to 4% to 6% from 2021. This expectation includes an approximately 150 basis point additive impact from recently acquired businesses, and an approximately 225 basis point negative impact from foreign currency translation. Adjusted EBITDA margin for the full year is expected to be approximately 22%, the low end of its previous outlook due to foreign currency headwinds. This outlook assumes approximately $200 million impact from premium supply chain costs.
Free cash flow is now expected to be at least $650 million, inclusive of the anticipated $150 million of settlement and related payments.
The company does not provide a reconciliation for non-GAAP estimates on a forward-looking basis where it is unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing or amount of the most directly comparable forward-looking GAAP financial measure as discussed under the “Forward-Looking Statements” caption below. This would include items that have not yet occurred, are out of the company’s control and/or cannot be reasonably predicted, and that would impact diluted net earnings per share. For the same reasons, the company is unable to address the probable significance of the unavailable information. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures.
