On this page of StockholderLetter.com we present the latest annual shareholder letter from VALMONT INDUSTRIES INC — ticker symbol VMI. Reading current and past VMI letters to shareholders can bring important insights into the investment thesis.

 •  3/25/2024 Letter Continued (Full PDF)
 •  3/14/2023 VMI Stockholder Letter
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VMI Shareholder/Stockholder Letter Transcript:

2023 MESSAGE TO
FELLOW STAKEHOLDERS
AND FORM 10-K
FOR THE FISCAL YEAR ENDING DECEMBER 30, 2023

A MESSAGE TO
OUR STAKEHOLDERS
AVNER M. APPLBAUM
President &
Chief Executive Officer
Valmont achieved full-year net sales of $4.2 billion, a decrease of 3.9%. When accounting for sales from the offshore wind energy
structures business that was divested in December 2022, net sales decreased 1.7%. While the North American agriculture and
telecommunications markets experienced a meaningful slowdown, the rest of the portfolio showed strength. Despite these short-term
demand headwinds adversely impacting the top line, we expanded both gross profit margins and adjusted1 operating margins. We
also achieved adjusted2 diluted earnings per share of $14.98, over 8% growth year-over-year. Additionally, we achieved
adjusted1 return on invested capital of 14%. I am proud of the global Valmont team for their achievements.
Driving Sustainable Profitable Growth
During my tenure at the company, first as CFO and now as CEO, the global team has showcased their commitment to maintaining
our market leadership. We deliver value to our customers through innovative solutions and operational excellence initiatives, and we
capture that value through superior customer service and disciplined pricing strategies. This approach has led to significant profitability
improvements. We will continue to build on this success, and we expect further enhancement in the years to come.
Operating Income ($M)
and Operating Margin
Return on Invested Capital
14.0%
$473
$433
13.3%
$450
11.7%
10.3%
$334
$268
$292
$287
$226
11.3%
10.0%
9.3%
7.8%
2020
10.1%
10.3%
12.9%
8.7%
9.5%
7.2%
8.2%
7.0%
2021
2022
GAAP
Adjusted1
2023
2020
2021
2022
Base
Adjusted1
2023
1
Fiscal 2023 excludes the impairment of long-lived assets, realignment charges, and other non-recurring charges associated with major scope changes for two strategic projects initiated by departed senior leadership.
Fiscal 2022 excludes intangible asset amortization and stock-based compensation recognized for the Prospera subsidiary. Fiscal 2021 excludes the impairment of long-lived assets, intangible asset amortization and
stock-based compensation recognized for the Prospera subsidiary, the write-off of a receivable, acquisition diligence, and severance expense. Fiscal 2020 excludes the impairment of long-lived assets and restructuring
and related asset impairment costs. See reconciliations provided on the Financial Highlights page.
2
Fiscal 2023 excludes the above referenced items, the loss from Argentine peso hyperinflation, and non-recurring tax benefit items. Fiscal 2022 excludes the above referenced items and the loss from the
divestiture of the offshore wind energy structures business. Fiscal 2021 excludes the above referenced items, the impact of the U.K. tax rate change, and a valuation allowance against certain tax assets.
Fiscal 2020 excludes the above referenced items. See reconciliations provided on the Financial Highlights page.
1

Additionally, we generated strong operating cash flows in 2023. We strengthened our balance sheet and are reinforcing a disciplined
capital allocation strategy of supporting growth initiatives and returning cash to shareholders. Capital expenditures and acquisitions
are filtered through strategic and financial criteria to ensure resources are deployed effectively. We will continue returning cash to
shareholders through a combination of opportunistic share repurchases and dividends. We believe this capital allocation approach,
enabled by strong and consistent cash generation, is the right plan to maximize value for our shareholders.
Taking Action to Advance Our Strategic Objectives
2023 was a year of change for Valmont. Following my transition into the CEO role, I took steps to improve leadership, focus and
structure at Valmont. Among the most notable leadership changes were naming Aaron Schapper as Group President, Agriculture and
Chief Strategy Officer and Tim Donahue as Group President, Infrastructure. These two industry veterans have proven time and again
their ability to lead high-performance teams that consistently deliver results. Our leadership team is aligned around achieving our
strategic objectives and I am confident we have the right team in place to deliver sustainable results.
We made several strategic decisions to better position Valmont for the future. We implemented an organization realignment to simplify
reporting lines and improve the efficiency and effectiveness of our organizational structure. This realignment enhances our ability to respond quickly to market dynamics, including accelerating operations when short-term market headwinds abate. Additionally, we made
necessary changes to the commercial and go-to-market strategies of our ag tech solution offerings, allowing us to better serve growers
around the world. The successful execution of these actions was critical. As a result, I am confident we are better positioned to deliver
sustainable, profitable growth and value creation for all our stakeholders.
Leveraging Our Competitive Advantages
Our Proven Competitive Advantages Uniquely
For nearly 80 years, Valmont has built a legacy of success on a
Position Us as a Leader In Our Markets.
diversified portfolio of businesses. We have a leading presence in
We Expect To Grow Faster Than Our Markets With:
markets with multi-year demand drivers addressing global megatrends.
    Strategic Geographic Expansion
Infrastructure is supported by the energy transition, making reliable
    New Products and Services
power accessible to all while adapting to increasing energy needs.
In Agriculture, growers are maximizing their yields through productivity
    Customer-Centric Innovation
and sustainability enhancements in order to feed a growing population.
    Footprint & Response Time
Our businesses satisfy these demand drivers with innovation that
    Engineering Capabilities
solves our customers    greatest challenges, both now and in the future.
Our customer-centric approach to innovation improves the adoption
rate of new products and helps us retain and gain customers. With unwavering dedication to our customers and by leveraging our competitive advantages, we deliver a compelling and unique value proposition through innovation with a strong return on investment.
Our purpose, Conserving Resources. Improving Life.    is at the core of everything we do. It supports our overarching promise to
provide solutions that improve the lives of our customers and our communities. We prioritize sustainability initiatives not only because
it   s the right thing to do for the planet     it   s also a business decision that drives continuous improvement of our operations and reduces
our costs associated with energy, waste and resource consumption. We   ve also naturally evolved our product offerings and have
established a competitive advantage in helping our customers meet their own sustainability goals. Our strategic approach drives
governance and accountability for these vital initiatives. We will publish our 2024 Sustainability Report later this year, highlighting
recent achievements and progress toward our 2025 sustainability goals.
As we pursue opportunities in 2024 and beyond, we will do so with discipline, focus and strong accountability to drive shareholder
value. I am honored to be the CEO of a company with a rich legacy and a bright future, and I   m grateful for the trust placed in me by
our board of directors. Our executive leadership team is aligned and eager to lead Valmont to new heights and advance our strategic
objectives. And our global team is united around creating value through our core values and focus areas. Thank you, our shareholders,
for your continued support and investment in Valmont.
Avner M. Applbaum
President & Chief Executive Officer
2

2023 PERFORMANCE
$4.2
100+
21
84
11,000+
Billion Dollars
in Net Sales
Countries
of Operation
Countries with
Valmont Facilities
Manufacturing
Facilities Worldwide
Global
Employees
GAAP
Adjusted 1
GAAP
7.0%
$291.6M $473.2M
Adjusted 2
$6.78
11.3%
Operating Margin
Operating Income
GAAP
Adjusted 1
$14.98
Diluted Earnings per Share
Base
Adjusted
7.2%
14.0%
After-Tax Return on Invested Capital 3
5-Year Cumulative Total Return
Valmont Compared to S&P MidCap 400 Index and S&P 400 Industrial Machinery & Supplies & Components Index
$300
$250
$200
$150
$100
DEC 18
Valmont Industires, Inc.
DEC 19
DEC 20
S&P MidCap 400 Index
DEC 21
DEC 22
DEC 23
S&P 400 Industrial Machinery & Supplies & Components Index
This graph compares the yearly change in the cumulative total shareholder return on the Company   s common stock with the cumulative total returns of the S&P MidCap 400 Index and the S&P 400 Industrial Machinery
& Supplies & Components Index for the five-year period ending December 30, 2023. The Company was added to these indexes in 2009 by Standard & Poor   s. The graph assumes that the beginning value of the investment in Valmont Common Stock and each index was $100 and that all dividends were reinvested.
1
Excludes the impairment of long-lived assets, realignment charges, and other non-recurring charges associated with major scope changes for two strategic projects initiated by departed senior leadership. See
reconciliations provided on the Financial Highlights page.
2
Excludes the impairment of long-lived assets, realignment charges, and other non-recurring charges associated with major scope changes for two strategic projects initiated by departed senior leadership, the loss from
Argentine peso hyperinflation, and non-recurring tax benefit items. See reconciliations provided on the Financial Highlights page.
3
See Part II, Item 7, Selected Financial Measures, in the Company   s attached Form 10-K for calculation of invested capital, return on invested capital, and adjusted return on invested capital.
3

Infrastructure sales were $3.0 billion, an increase of
3% year-over-year, due to higher average selling prices across the
portfolio. Additionally, higher volumes in Solar and Transmission,
Distribution and Substation were partially offset by much lower
Telecommunications volumes.
Agriculture sales were $1.2 billion, a decline of 12% year-over-year.
Higher international sales, due to higher project sales and
incremental sales from the HR Products acquisition, were more
than offset by lower volumes in North America.
In the short term, we expect more challenging global
market conditions due to lower grain prices and farm income
projections. However, we expect growers    balance sheets
to remain strong. To help mitigate some of the softening
demand, we remain focused on price leadership, strengthening
our international project pipeline and increasing adoption of
our technology solutions. We remain confident in the
long-term market opportunity driven by weather volatility,
water scarcity and sustainability considerations. International
market demand is driven by ongoing food security concerns
and population growth. Our mechanized irrigation and
technology solutions provide a compelling return on investment
and will continue to help growers do more with less.
The short and long-term outlook on Infrastructure remains
positive. Although Telecommunications sales are expected to
remain lower until major carriers increase network enhancement
spending, this softness is expected to be more than offset by
strength across the segment. Infrastructure is supported by
multi-year megatrends, including an energy transition. The shift
to renewables and increase in energy needs, along with aging
infrastructure and severe weather is leading utilities to sustain
elevated capital spending. In addition, Solar is supported by
favorable policy and Lighting and Transportation is supported by
road construction investments. Our products and solutions in a
wide variety of resilient and sustainable materials will support
the needs of our customers.
Infrastructure Sales ($M) by Product Line
Transmission, Distribution
and Substation
Agriculture Sales ($M) by Product Line
2023
2022

$1,243.8
$1,184.7
+5%
2023
2022

North America
$587.1
$766.9
(23%)
International
$595.1
$579.8
+3%
2023
2022

$1,069.4
$1,231.6
(13%)
$112.8
$115.1
(2%)
Lighting &
Transportation
$964.1
$940.5
+3%
Coatings
$354.3
$356.7
(1%)
Telecommunications
$252.2
$320.3
(21%)
Irrigation
Equipment & Parts
Solar
$195.7
$126.2
+55%
Technology Products
& Services
2023 NET SALES BY GEOGRAPHY
70%
USA &
CANADA
9%
10%
LATIN
AMERICA
EMEA
5
4
11%
APAC



 3/25/2024 Letter Continued (Full PDF)