On this page of StockholderLetter.com we present the 5/1/2023 shareholder letter from ARMSTRONG WORLD INDUSTRIES INC — ticker symbol AWI. Reading current and past AWI letters to shareholders can bring important insights into the investment thesis.

 •  5/1/2023 Letter Continued (Full PDF)
 •  4/29/2024 AWI Stockholder Letter
 •  4/28/2025 AWI Stockholder Letter
 •  More "Construction Materials & Machinery" Category Stockholder Letters
 •  AWI Benford's Law Stock Score = 100

AWI 5/1/2023 Shareholder/Stockholder Letter Transcript:

2022
Annual
Report

Dear Fellow Shareholders,
Our company delivered another year of solid
performance in 2022 while managing through
a shifting macroeconomic environment that
produced a myriad of challenges. These included
labor and supply chain issues, rapid in   ation, rising
interest rates and increased economic uncertainty.
I   m proud of how our teams adjusted to these challenging
dynamics. We maintained focus on delivering value to our
customers, partners, employees and shareholders as we continued to
advance our growth strategy.
Highlights from 2022 include:

Revenue growth of 11% from 2021 results driven by 8% growth
in our Mineral Fiber segment and 20% growth in our Architectural
Specialties segment

Mineral Fiber Average Unit Value1 performance that more than offset
in   ation and the impact of lower Mineral Fiber sales volumes

Improved pro   tability within our Architectural Specialties segment as
we drove better pricing and operational ef   ciency

Signi   cant value returned to shareholders with more than $200 million
of share repurchases and cash dividends

Continued our sustainability journey with our second sustainability report
and received approval of our 2030 greenhouse gas emissions reduction
targets by the Science Based Targets Initiative
Our 2022 results re   ect the strength of our market position, our ability to adapt
to changing economic environments, and our commitment to our corporate
purpose of making a positive difference in the places where people live, work,
learn, heal and play.
Moving Forward
As we turned the page on 2022, we have taken stock of where we   ve been and
where we   re going. When I joined the company in 2011, Armstrong was a larger,
less focused company with a global footprint that was exposed to signi   cant
market volatility. Over the last 12 years, we executed a separation from the
   ooring business, streamlined our asset base to focus on the Americas
ceilings and specialty walls market, and acquired nine Architectural Specialties
businesses to build the broadest portfolio of ceiling products in the industry
and fuel signi   cant, pro   table top-line growth for the company.
Importantly, our Americas focus on this attractive ceiling and walls segment
of the commercial construction industry has increased our resilience and
uniquely positions us to invest to deliver pro   table growth through all
economic cycles. Our strategic growth investments include expanding our
Architectural Specialties segment through acquisitions and organic growth,
digital tools that further strengthen our business by deepening our customer
relationships, and our Healthy Spaces initiative to support the overall wellbeing of building occupants. Our investments are designed to drive growth by
either spurring renovation, accessing new demand from underserved parts of
the market, or selling more products in more spaces.
1
Average Unit Value includes like-for-like price and mix bene   ts.

Financial Score Card
Dollars in millions except per share data
$288
$4.74
$4.30
$4.36
$3.86
($1.76)
$3.74
$4.78
2022
$4.88
$385
$279
2021
$3.66
$372
$260
2020
As Reported & Adjusted Diluted EPS
from Continuing Operations*
$3.63
$255
$330
$317
$403
$249
$353
Operating Income & Adjusted EBITDA*
2019
$211
$212
$174
$819
$726
$827
$802
$887
2018 2019 2020 2021 2022
2018 2019 2020 2021 2022
2018
$346
Architectural Specialties Net Sales
Mineral Fiber Net Sales
2018 2019 2020
Operating Income
Adj. EBITDA*
$221
$190
$212
$236
$211
$173
$244
Adjusted Free Cash Flow*
$513
$78
2022
As Reported Diluted EPS
Adj. Diluted EPS*
Cash Flow from Operating and
Investing Activities **
$94
2021
2018 2019 2020 2021 2022
2018 2019 2020 2021 2022
2022 Capital Deployment
16%
Share Repurchases
$284
26%
Capital Expenditures
58%
Dividends
* Non-GAAP measure. Reconciliations to nearest GAAP measures provided at the end of this report.
** 2018 includes $272M of net proceeds related to the sale of international operations.

Our Growth Initiatives
Our expansion in Architectural Specialties has been a powerful growth driver for
Experience, Above All   
Armstrong. By acquiring niche companies with unique, highly speci   able products and
We   ve worked recently to better understand
capabilities, we have broadened our reach with architects and designers, accessed
how Armstrong World Industries as a brand
more opportunities in statement projects, and, in the process, sold more of our core
resonates with architects and designers and
Mineral Fiber products. Revenue for this segment has more than tripled since 2016 from
customers, as well as our employees and
$101 million to $346 million in 2022. We believe there are more growth opportunities in
the communities where we operate. What
this exciting category as we continue to leverage recently acquired businesses on the
has come through loud and clear is that
Armstrong platform.
Armstrong provides our many stakeholders

We are also driving growth with our digital initiatives with both Kanopi by Armstrong,
a great experience. Whether from the
our digital, direct-to-customer marketplace, and ProjectWorks , our automated design
perspective of a customer looking for
service. Kanopi, in particular, delivered quarter-on-quarter sales growth throughout
quality and service, an architect or designer
2022. This platform is designed to stimulate new sales opportunities from latent demand
seeking to bring their design intent to life,
in the sizable installed base of mineral    ber ceilings, particularly from small customers
a general contractor working to cost-
with limited knowledge of ceiling attributes, design and installation. Our results are
effectively and ef   ciently install complex
validating that Kanopi is providing an easy, effective platform to create new demand for
ceiling and wall solutions, or the human
Armstrong solutions.
experience as people enjoy the acoustical

and aesthetic bene   ts of our products in
Demand for ProjectWorks by designers, architects and contractors is also increasing.
We continue to improve and accelerate the speed with which complex designs can be
turned into work plans through the automation of design rules applied to ceiling projects.
We have broadened its capability by incorporating more of our product portfolio into
ProjectWorks, including many of our Architectural Specialties products. This service is
an important example of how we differentiate Armstrong in the marketplace and enhance
customer experiences.
We continue to make progress on our Healthy Spaces initiative by expanding the role
ceilings play in achieving healthier, more sustainable spaces. We see this progress with
increased 2022 sales of our Healthy Spaces mineral    ber products such as AirAssure    and
Health Zone  . We continue to be excited about the possibilities in this area as we develop
solutions that can impact the four key elements of Indoor Environmental Quality (IEQ)    
air, sound, light and temperature. This includes new products like our StrataClean IQ   , an
in-ceiling MERV 13    ltration system, and new partnerships such as we initiated with Awair,
a leader in IEQ sensor technology.
Returning Value to Shareholders
We have been able to make these important growth investments even while facing the
unprecedented challenges of COVID-19 and its aftermath because of our strong market
position, business model and execution. These strengths also support our ability to
return value directly to shareholders. In fact, since 2016, we delivered more than $1
billion in shareholder returns through a combination of dividends and share repurchases.
In closing, the results we have achieved and the momentum we   re building with our
growth initiatives are a tribute to the extraordinary efforts of our employees. Their
dedication, agility and passion help us preserve and build upon our industry-leading
position and will help sustain our success for years to come. I look forward to updating
you on our future progress.
Vic Grizzle
President and Chief Executive Of   cer
Middle: Optima   Tegular Ceiling Panels with
Supra   ne   XL   9/16" Exposed Tee System
Bottom: FeltWorks   Blades     HookOn Ebbs & Flows
the spaces they occupy, we work each and
every day to ensure these are excellent,
best-in-class experiences.



 5/1/2023 Letter Continued (Full PDF)