To our stockholders, customers and employees:

The year 2022 was one of significant growth and expansion for Simpson Strong-Tie, which we accomplished by continuing to focus on our ambitions, customers and employees. Through our unwavering commitment to our Company mission to help people build safer, stronger structures, we sustained strong volume and revenue growth amid global macroeconomic challenges, including inflation and rising interest rates. We closed our largest acquisition to date to further our growth strategy while continuing to deliver superior service and enhanced value to our customers. Our success was made possible by our dedicated 5,000+ employees, our trusted 66-year brand reputation, and our commitment to best-in-class customer service and product availability.

Strong Financial and Operational Performance

Our industry-leading position and strategic growth initiatives continued to drive strong financial performance in 2022, with net sales increasing 34.5% year-over-year to $2.1 billion. Sales growth was predominantly driven by our acquisition of ETANCO, which contributed $212.6 million to our 2022 net sales, as well as by the product price increases we implemented throughout 2021 to offset rising raw material costs. As a result, we achieved strong earnings of $7.76 per diluted share, up 26.8% from 2021. Operationally, since unveiling our Company Ambitions in March of 2021, we continued to make significant progress toward the following goals:

1. Strengthen our values-based culture

2. Be the partner of choice

3. Be an innovative leader in the markets in which we operate

4. Continue above-market growth relative to US housing starts

5. Expand our operating income margin to remain within the top quartile of proxy peers

6. Expand return on invested capital (ROIC)1 within the top quartile of proxy peers 

While we have continued to benefit from the US housing market, we now believe approximately 50% of our revenue is reliant on US housing starts, compared to approximately 60% prior to the acquisition of ETANCO. This strategic acquisition has opened up new market opportunities with its complementary product offering and business model. 

We continue to emphasize innovation among all our product lines, which includes strengthening our structural connector offering, striving to be a leader in engineered load-rated fastening and anchoring system solutions, and building our software portfolio. We are equally dedicated to delivering an array of integrated construction solutions to our customers and have realigned our sales teams to focus on our five end-use markets — Residential, Commercial, OEM, National Retail, and Building Technology. Our solutions-based market strategy has led to increased sales and numerous new customer and project wins, furthering our growth initiatives.

Acquisition of ETANCO

We officially closed the acquisition of the ETANCO Group on April 1, 2022, and proudly welcomed more than 870 new employees to the Simpson Manufacturing family. As a leading designer, manufacturer, and distributor of fixing and fastening solutions for the building envelope market throughout Europe, ETANCO’s high-quality product line and core values, including their deep focus on customer service, strongly complement our existing business. The basic similarities in our company values led to a smooth integration process with a high level of teamwork and collaboration. ETANCO’s extensive and complementary product offering, as well as its distinctive focus on energy conservation through façades and solar applications, has already significantly strengthened our product portfolio in Europe and has enabled us to deliver even greater value to our expanded customer base. Importantly, the acquisition further diversifies our business away from US housing starts, supporting both commercial and residential end users in France and other markets.

Effective Capital Allocation Fuels Growth and Stockholder Returns

The strength in our profitability coupled with effective working capital management enabled us to generate strong cash flows from operations of $400.8 million in 2022, an increase of 165% over 2021. Our cash was utilized to finance a portion of the $805.4 million acquisition cost of ETANCO, support the payment of $43.9 million in quarterly cash dividends and the repurchase of $78.6 million of our common stock, and fuel $62.4 million in capital expenditures. Our capital return target remains 35% of free cash flow. This compares to our historical capital return target of 50% as we focus on the repayment of the debt we incurred to finance the acquisition of ETANCO. Over the past three years, we’ve paid $125.9 million in dividends and repurchased $178.9 million of our common stock, resulting in approximately 49.1% of our free cash flow returned to our stockholders. Further, our solid operational execution and returns to stockholders led us to achieve an ROIC1 of 21.1% for the 2022 fiscal year compared to 24.6% in 2021.

CEO Transition

The year 2022 marked a transition in Simpson’s leadership, as our former Chief Executive Officer, Karen Colonias, stepped down as CEO at the end of 2022 as part of a strategic and deliberate succession planning process developed with our Board of Directors. Karen’s 38 years of dedication and service to the Company included leadership roles as CFO, Vice President and Branch Manager, and Vice President of Engineering. During her tenure, Karen helped established Simpson as an industry leader in the building products space and significantly improved the Company’s financial performance. Mike Olosky has succeeded Karen as Simpson’s President and Chief Executive Officer effective January 1, 2023. From November 2020 to December 2022, Mike served as our Chief Operating Officer, and beginning in January 2022 also as our President. We are grateful for Karen’s leadership and wish her all the best in her retirement as we embark on an exciting new chapter for Simpson.

Building Toward a More Sustainable Future

We strive to ensure that our business culture and practices promote health and safety; diversity, equity, and inclusion; and a rewarding work environment for our employees across the globe. As part of our ongoing commitment to better communicate our sustainability, environmental, and social responsibility efforts, we published our Environmental, Social, and Governance (ESG) Report in the spring of 2022. This latest report tracks additional metrics and features new targets for health and safety performance. Beyond this report, we have aimed to formalize and provide more transparency about our ESG efforts, including the adoption of a new, more comprehensive Environmental, Health, and Safety policy; continued focus on employee diversity, equity, and inclusion (DEI); and formal articulation of our Position on Human Rights to support our partners in recognizing and abiding by international human rights principles. In partnership with our Board, our ESG team, and our newly established ESG Steering Committee, Simpson Manufacturing and its subsidiaries will continue to strive for continuous improvements in our environmental, health, and safety programs along with the sustainability of our products, processes, and services. On behalf of everyone at Simpson Manufacturing Co., Inc., we thank all our loyal customers, employees, suppliers, and stockholders for your ongoing support.


Michael L. Olosky

President and Chief Executive Officer

James Andrasick

Non-Executive Chairman of the Board of Directors

1When referred to above, the Company’s return on invested capital (ROIC) for a fiscal year is calculated based on (i) the net income of that year, as presented in the Company’s consolidated statements of operations prepared pursuant to generally accepted accounting principles (GAAP) in the US, as divided by (ii) the average of the sum of total stockholders’ equity and total long-term debt at the beginning of and at the end of such year, as presented in the Company’s consolidated balance sheets prepared pursuant to GAAP for that applicable year. As such, the Company’s ROIC, a ratio or statistical measure, is calculated using exclusively GAAP financial measures.