Nordson Corporation Investor Presentation

Transcription

1 Nordson Corporation Investor Presentation A premier industrial technology company focused on precision dispensing, fluid control and related processes : NDSN August 21, 2017 Fiscal Q Results & 4Q Outlook

2 Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 Information in this presentation may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of Forward-looking statements can be identified by words such as may, will, should, expects, intends, plans, anticipates, believes, estimates, predicts, projects, or potential or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. All statements regarding our future performance, earnings projections, events or developments are forward-looking statements. These forward-looking statements are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks that could cause actual results to differ materially from those contained in any forward-looking statement. Such risks and uncertainties are described under Risk Factors in Item 1A of our annual report on Form 10-K and any updates to those factors set forth in our subsequent quarterly reports on Form 10-Q or current reports on Form 8-K. We make these statements as of the date of this disclosure, and undertake no obligation to update them unless otherwise required by law. 2

3 Nordson at a Glance A premier industrial technology company focused on precision dispensing, fluid control and related processes Founded in 1954 FY16 sales = $1.8 billion 7,200 employees Direct presence in 35+ countries Best-in-class technology Diversified, growing end markets Market leading positions Sustained financial performance Outstanding long-term returns 3

4 Diversified Sources of Revenue FY2016 Profile - $1.8 billion Product Type High percentage of recurring revenue from parts and consumables Engineered Systems 21% Parts & Consumables 40% Geography Very global. 71% of revenue outside USA. Direct presence in nearly 40 countries. Asia Pacific 29% USA 29% Standard Product 39% Japan 7% Europe 28% Americas 7% Diverse End Markets Consumer non-durables, durables, industrial, medical and technology PCB Assembly 9% Semiconductor 6% Electronic Components 9% Medical 8% Automotive 7% Industrial 6% Consumer Non-Durables 38% Consumer Durables 17% Operating Segments Three segments with leading product lines and brands Adhesive Dispensing 49% Industrial Coating 14% Advanced Technology 37% 4

5 *((Share Price at 10/31/2016 Share Price at 10/31/ dividends) / Share Price at 10/31/2011 ) = (($ $ $3.81) / $46.37 ) = 1.24 = 124% Investment Highlights Strong growth: organic and acquisitive Outstanding gross margins Excellent operating margins High level of free cash flow before dividends Strong cash returns to shareholders Reliable and consistent dividend Outstanding long term Total Shareholder Returns 8% CAGR % Gross Margin Average % Operating Margin Average $1.4 billion 101% of net income $1.1 billion Share repurchases & dividends Years of annual increases (21% payout ratio in 2016) 124% TSR*

6 Total Shareholder Return Above Our Peers Source: Assumes $100 invested on 11/1/2011, dividends reinvested, fiscal year ending 10/31/ *Peer Group = AIN, AME, ATU, B, CLC, DCI, ENTG, ESL, FLIR, GGG, GTLS, IEX, ITT, KEYS, LECO, ROP, TER, WTS, WWD

7 Why invest in Nordson? Clear Strategy and Goals Strong Execution and Performance Leading Global Businesses Numerous Growth Opportunities Outstanding Culture and Values 7

8 Common Themes of our Strategic Plan Continue to be a Premier Industrial Technology Company Accelerate organic growth Product innovation New applications Emerging markets Recapitalize installed base Segmentation Add key acquisitions Targeted spaces Growth and technology Cultivate proprietary deals Execute and close deals effectively Disciplined pricing Fast integration Further optimize our business Embed Nordson Business System Expand margins Working capital initiatives Drive synergies with acquisitions Enhance and expand organization capability Deepen bench strength Leadership development Rotational assignments Diversity Deliver top quartile total shareholder returns Support our communities & good corporate citizenship

9 Strategic Plan Targets Focused initiatives drive premium sales growth and expand profitability Outpace Revenue Growth % Continuous Improvement ~2x global GDP% Growth Initiatives Underlying Markets Revenue Operating Profit

10 The Nordson Business System Driving Continuous Improvement Across the Organization Key Performance Indicators Growth Initiatives Price Effectiveness Cost Reduction Initiatives Cost of Poor Quality Customer Delivery Performance Days of Sales in Inventory Productivity Sales from New Products 10

11 Why invest in Nordson? Clear Strategy and Goals Strong Execution and Performance Leading Global Businesses Numerous Growth Opportunities Outstanding Culture and Values 11

12 Millions of $ 2,100 1,800 1,500 1, Strong Top Line Growth organic and acquisitive 10 Year CAGR = 7.3% '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 Financial Highlights +7.1% over FY15 Industry Leading Gross Margins Consistently mid 50s and above 70% 60% 50% 40% 30% 20% 10% 0% pts over FY15 Strong Operating Margins Continuous Improvement Initiatives EPS Growth Outpaces Sales Growth Over Time 30% 25% 20% 15% Dilutive effect of acquisitions +2.7 pts over FY15 $5.00 $4.50 $4.00 $3.50 $ Year CAGR = 12.7% +37.1% over FY15 10% 5% $2.50 $2.00 $1.50 0% * $ * *FY09 excludes non-cash charges for impairment of goodwill and other long-lived assets. FY15 results impacted by significant negative currency translation effects compared to the prior year. source NDSN SEC filings

13 $000 $000 Strong Cash Generation Funds Growth and Returns to Shareholders Cash from Operations: > 10% as a % of sales every year Strong Cash Conversion: Free cash flow before dividends = 103% of net income $350,000 $300,000 $300,000 $250,000 $250,000 $200,000 $150,000 $100,000 $200,000 $150,000 $100,000 $50,000 $50,000 $0 $- Net cash provided by operating activities Free cash flow before dividends Net income 13 *FY09 excludes non-cash charges for impairment of goodwill and other long-lived assets. FY15 results impacted by significant negative currency translation effects compared to the prior year. source NDSN SEC filings

14 Disciplined Capital Deployment 100% 90% 80% 70% 60% 50% $28.5 $20.2 $88.5 $138.0 $33.8 $29.8 $25.8 $40.6 $37.7 $33.4 $40.5 $166.4 $383.9 $48.4 $21.3 $56.4 Working Cap. 6% Share Repur. $ % $843.6 Dividends 10% $174.1 $ % or $1.1 billion to shareholders via share repurchases and dividends 40% 30% $293.0 $441.7 $176.3 $186.4 $54.8 $42.7 Acquisitions 44% $1, % 10% 0% $24.8 $30.0 $49.2 $75.6 $49.1 $66.7 $64.6 PP&E/Leases 10% $ TOTAL $ millions Self funding business model generates excess cash Low Working Capital Requirements Low Capital Expenditures (approx. 3% of sales) Strong free cash 54 consecutive years of dividend increases - 14 th among publicly traded companies 14

15 In millions $ Strong Capital Management Net Debt to EBITDA* Strong Cash Generation Lets Nordson De-lever Quickly Debt Position at 7/31/ EFD Acquisition Acquisitions & Share Repurchases $1,000 $900 $800 Drawn $905 Available % Outstanding Stock Repurchase Four Acquisitions $700 $600 $500 $400 $ $300 $200 $ $100 $0 $100 Private Placement(1) [ 19] $22 Term Loan A EUR(2) Term Loan A US(3) $100 (a) $57 (b) NYLIM Shelf(4) $173 Private Placement(5) Syndicated Revolver(6) at fiscal years ending 10/31 At 7/31/2017 Net Debt to TTM EBITDA = 3.0 times 2.7x including TTM acquired EBITDA (1) Amortizing-avg rate 3.04% -Remaining Avg. life 6.5 years (2) Term: ~$22m o/s 3 years (Q4 FY19) at 1.125bps over EUR Libor / EUR denominated (3) -Term $100m - 3 years (Q2 FY18) at bps over USD Libor -Term $100m - 5 years (Q2 FY20) at 1.25 bps over USD Libor -Term $305m 5 years (Q3 FY22) at bps over USD Libor -Term $200m 3 years (Q3 FY20) at 125 bps over USD Libor -Term $200m 18 mos (Q1 FY19) at bps over USD Libor (4) (a) $100m matures Oct 2026 at 125 bps over USD Libor (b) $57m 1.80 remaining avg life at 2.36% (5) Amortizing-avg rate 3.02% -Remaining Avg. life 3.77 years (6) Ends Feb bps over USD Libor based on Q3 grid 15 *Net Debt to EBITDA calculated net of cash

16 Fiscal Year Q Results and 4Q Guidance as reported in August 21-22, 2017 press release and webcast Nordson Corporation Reports Record Quarterly Revenue, Operating Profit, Diluted EPS and EBITDA in Third Quarter of Fiscal Year 2017 Sales increase 20 percent from prior year s third quarter to $589 million, with all three segments contributing to 11 percent organic growth Operating profit increases 24 percent to $153 million and operating margin improves by 1 percentage point to 26 percent, both compared to the prior year s third quarter and both inclusive of $6 million of intangible asset amortization expense for fiscal 2017 acquisitions GAAP diluted EPS increases 19 percent to $1.74 and adjusted diluted EPS increases 21 percent to $1.78, both compared to the prior year s third quarter EBITDA increases 29 percent to $179 million, EBITDA margin improves 2 percentage points to 30 percent, and EBITDA per diluted share increases 27 percent to $3.08, all compared to the prior year s third quarter Free cash flow before dividends increases 14 percent compared to the prior year s third quarter to $55 million Order Rates and Guidance Pro-forma 12 week order rates decrease 2 percent over same period a year ago Fourth quarter 2017 guidance: sales expected to increase 4 to 8 percent over prior year; GAAP diluted EPS in the range of $1.18 to $1.32; EBITDA in the range of $133 to $144 million, or $2.27 to $2.46 per diluted share 16 See Nordson press release, conference call transcript, presentation Appendix, and SEC filings reconciling adjusted amounts to reported amounts

17 Why invest in Nordson? Clear Strategy and Goals Strong Execution and Performance Leading Global Businesses Numerous Growth Opportunities Outstanding Culture and Values 17

18 We Win with Unique Competitive Advantages Common across our businesses Core Competencies Application development Precision manufacturing Engineering strength Technical expertise Direct global sales and service Customer touch / solutions provider Strategic Assets Customer relationships with leaders Product breadth Technology position Premier brand reputation Large installed product base Global footprint (distribution, support) Balance sheet / ability to scale production Customer Value Proposition Product reliability = more uptime Speed = greater productivity and yield Efficiency = lower material usage Leading product features = ease of operation Unmatched global support Lower Cost of Ownership 18

19 Every Day You Experience the Value We Bring Adhesive Dispensing Systems: consumer non-durable market focus Advanced Technology Systems: electronics, medical and industrial market focus Industrial Coating Systems: durable goods and industrial market focus 19

20 Adhesive Dispensing Systems Leader in recession-resistant, consumer non-durable end markets Targeted organic growth rate: 1.5 to 2x global GDP Sales CAGR = 7.5% average annual operating margin = 27.7% What we do: Products to melt, filter, pump, transport, dispense and deposit adhesives, polymers and other materials in the manufacturing of a wide range of goods. Packaging Nonwovens Growth Drivers Increased use of disposable hygiene products (diapers, fem care, etc) Increased use of packaged convenience foods Increased use of plastics Emerging markets Product tiering Recapitalization of large installed base Productivity investments Material, machinery and process innovations Key End Markets Food and beverage packaging Nonwovens / disposable hygiene / diapers Furniture and building products Macro electronics General industrial assembly Alternative energy Medical devices Labeling Transportation Product Assembly Polymer Processing 20

21 Advanced Technology Systems Leader in rapidly growing electronics, medical and related markets Targeted organic growth rate: 2 to 3x global GDP Automated Dispensing Sales CAGR = 9.0% average annual operating margin = 24.2% Test & Inspection What we do: Precision dispensing, fluid management, test, inspection and surface treatment products for electronics, medical and general industrial markets Growth Drivers Mobile computing smart phones, tablets Circuit shrinkage / new architectures / flip chips Medical needs driven by aging population Medical OEM outsourcing New consumers in emerging markets Product tiering Internet of things Key End Markets Semiconductor packaging Printed circuit board assembly General electronic assembly Medical devices Medical components General industrial assembly Automotive electronics MEMS, sensors, LEDs Solar Surface Treatment Semi Automated Dispensing Single Use Fluid Components 21

22 Industrial Coating Systems Leader in consumer durable goods and industrial end markets Targeted organic growth rate: global GDP+ Powder Coating Sales CAGR = 6.7% average annual operating margin = 15.1% Container Coating What we do: Precision equipment and systems to apply and cure paints, sealants, coatings, cold materials and other materials to a wide range of products Growth Drivers Growth in emerging markets Environmental advantages of powder coatings Glues replacing mechanical fasteners Light-weighting of vehicles Productivity investments Lean manufacturing Quick color change Product tiering Key End Markets Appliances Lawn and garden Food and beverage Automotive assembly Cold material dispensing Pipe coating and construction Woodworking General industrial Electronics / UV curing Cold Material Dispensing Liquid Painting 22

23 Why invest in Nordson? Clear Strategy and Goals Strong Execution and Performance Leading Global Businesses Numerous Growth Opportunities Outstanding Culture and Values 23

24 Multiple Paths to Organic Growth Annual Target is ~2x global GDP 20 New Products 15 Emerging Markets 10 Recapitalize Installed Base 5 Customer Product Changes New Applications 0 Global GDP NDSN Annual Organic Growth Rate Target 24

25 Innovation Drives Organic Growth Steady stream of new products $50,000 R&D Spend ($ 000) US Patents Granted Granted 75 $45, $40, $35, $30, $25, $20,

26 Emerging Markets Drive Organic Growth Growing middle class drives increased consumption Nordson Sales (000s) $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 Asia Pacific Americas $ baby diapers, disposable hygiene products packaged foods, beverages, convenience items appliances and other durable goods electronic devices medical products plastic goods 26 Americas reporting includes Canada, but not US -Asia Pacific excludes Japan -Eastern Europe, Middle East and Africa are reported in Europe and not broken out separately

27 New Applications Drive Organic Growth Leveraging our expertise numerous emerging opportunities over last five years Sensor assembly LED assembly MEMS assembly Wafer level inspection Wearable electronics Micro-materials testing Aerospace assembly Biopharmaceuticals Orthobiologics Minimally invasive catheters Bottle labeling Pipe coating Flexible packaging 27

28 Recapitalization Drives Organic Growth Large installed base of Nordson products worldwide provides regular replacement and upgrade opportunities Packaging lines Nonwovens lines Powder coating lines Extrusion & injection molding lines Electronics assembly lines 28

29 Acquisitions Drive Growth High quality properties supplement organic growth 35.0% 25.0% 15.0% 5.0% -5.0% : 3.7% average annual growth from acquisitions Organic Volume pause during recession Acquisitions Key Criteria Strategic fit Strong performers Growth rate at/above Nordson High % recurring revenue Reasonable multiples Revenue and cost synergies -15.0% -25.0% Current Focus and Recent Transactions Polymer Processing Fluid Mgmt. (medical) Test & Inspection Cold Material Dispense Core Dispense Portfolio 29

30 FY17 YTD Update - Four Transactions Announced All align with previously articulated strategy Core electronics fluid dispense and management Core industrial, animal health, and general fluid packaging & dispense Medical single use components and devices All will become part of Nordson Advanced Technology Systems segment further balances segment and adds greater mix of less cyclical end markets See for more detail 34

31 Why invest in Nordson? Clear Strategy and Goals Strong Execution and Performance Leading Global Businesses Numerous Growth Opportunities Outstanding Culture and Values 31

32 Strong Culture and Values Rooted in the vision of our founders My hope for Nordson is that we continue to be a venturesome company, operating somewhere out on the leading edge we must encourage innovators and entrepreneurs. Eric Nord To be truly fit, we must exercise our giving muscles. Evan Nord 32

33 Giving Back - Part of Who We Are ~$46 million donated Foundation Grants Corporate Donations $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $- Employees also volunteer thousands of hours via Time n Talent program 33

34 Investment Summary Proven Model for Long Term Value Creation Clear Strategy and Goals Strong Execution and Performance Leading Global Businesses Numerous Growth Opportunities Outstanding Culture and Values Strong growth: organic and acquisitive Outstanding gross margins Excellent operating margins High level of free cash flow Strong cash returns to shareholders Reliable and consistent dividend Outstanding long term Total Shareholder Returns 34

35 Financial Appendix

36 THIRD QUARTER PERIOD Period Ending July 31, 2017 (Unaudited) CONSOLIDATED STATEMENT OF INCOME NORDSON CORPORATION FINANCIAL HIGHLIGHTS (Dollars in thousands except for per-share amounts) CONSOLIDATED BALANCE SHEET Third Quarter Year-to-Date July 31 October Net sales $ 589,438 $ 489,899 $ 1,493,044 $ 1,299,711 Cash and marketable securities $ 110,705 $ 67,239 Cost of sales 263, , , ,179 Receivables 498, ,560 Selling & administrative expenses 172, , , ,964 Inventories 275, ,361 Other current assets 34,901 29,415 Operating profit 153, , , ,568 Total current assets 920, ,575 Interest expense - net (11,038) (4,471) (24,041) (14,989) Property, plant & equipment - net 335, ,129 Other income (expense) - net 27 (1,978) (1,452) 551 Other assets 2,219,515 1,401,879 $ 3,475,354 $ 2,420,583 Income before income taxes 142, , , ,130 Income taxes 40,999 33,023 91,454 67,154 Notes payable and debt due within one year $ 127,540 $ 40,234 Accounts payable and accrued liabilities 324, ,309 Net Income $ 101,456 $ 84,214 $ 215,967 $ 195,976 Total current liabilities 452, ,543 Long-term debt 1,569, ,771 Other liabilities 369, ,666 Return on sales 17% 17% 14% 15% Total shareholders' equity 1,084, ,603 Return on average shareholders' equity 28% 44% 45% 37% $ 3,475,354 $ 2,420,583 Average common shares outstanding (000's) 57,594 57,085 57,495 57,012 Average common shares and common share equivalents (000's) 58,259 57,616 58,171 57,419 Per share: Other information: Basic earnings $ 1.76 $ 1.48 $ 3.76 $ 3.44 Diluted earnings $ 1.74 $ 1.46 $ 3.71 $ 3.41 Employees 7,427 6,104 Dividends paid $.27 $.24 $.81 $.72 Common shares outstanding (000's) 57,692 57,051 Total dividends $ 15,550 $ 13,690 $ 46,549 $ 41,008 36

37 THIRD QUARTER PERIOD Period Ending July 31, 2017 (Unaudited) NORDSON CORPORATION FINANCIAL HIGHLIGHTS (Dollars in thousands) Third Quarter % Growth over 2016 Year-to-Date % Growth over 2016 SALES BY BUSINESS SEGMENT Volume Currency Total Volume Currency Total Adhesive dispensing systems $ 233,367 $ 220, % -0.3% 5.7% $ 668,146 $ 645, % -1.0% 3.5% Advanced technology systems 290, , % -0.4% 41.4% 645, , % -1.0% 34.1% Industrial coating systems 65,665 63, % -0.4% 3.0% 178, , % -1.2% 3.7% Total sales by business segment $ 589,438 $ 489, % -0.4% 20.3% $ 1,493,044 $ 1,299, % -1.1% 14.9% Third Quarter Year-to-Date OPERATING PROFIT BY BUSINESS SEGMENT Adhesive dispensing systems $ 66,451 $ 60,423 $ 185,226 $ 173,760 Advanced technology systems 87,385 63, , ,819 Industrial coating systems 13,192 10,612 30,529 25,082 Corporate (13,562) (10,464) (50,895) (31,093) Total operating profit by business segment $ 153,466 $ 123,686 $ 332,914 $ 277,568 Third Quarter % Growth over 2016 Year-to-Date % Growth over 2016 SALES BY GEOGRAPHIC REGION Volume Currency Total Volume Currency Total United States $ 182,953 $ 135, % % $ 464,569 $ 383, % % Americas 41,604 30, % 0.7% 36.3% 107,971 90, % -0.8% 18.9% Europe 133, , % 0.1% 4.1% 381, , % -2.3% 1.9% Japan 41,472 34, % -5.9% 19.5% 96,504 83, % -0.6% 15.5% Asia Pacific 189, , % -0.2% 17.7% 442, , % -1.1% 20.5% Total Sales by Geographic Region $ 589,438 $ 489, % -0.4% 20.3% $ 1,493,044 $ 1,299, % -1.1% 14.9% Third Quarter Year-to-Date FREE CASH FLOW BEFORE DIVIDENDS Net income $ 101,456 $ 84,214 $ 215,967 $ 195,976 Depreciation and amortization 25,954 17,662 65,366 52,824 Other non-cash charges (8,592) 4,455 3,041 13,213 Changes in operating assets and liabilities (41,991) (38,485) (68,183) (67,279) Net cash provided by operating activities 76,827 67, , ,734 Additions to property, plant and equipment (22,295) (19,931) (49,324) (45,452) Proceeds from the sale of property, plant and equipment ,906 1,044 Free cash flow before dividends $ 54,840 $ 48,088 $ 170,773 $ 150, Adjustments: Acquisition costs and adjustments, net of tax (1) 1,597-12,564 1,325 Free cash flow before dividends, adjusted $ 56,437 $ 48,088 $ 183,337 $ 151,651 (1) Represents one-time costs, net of tax, associated with our 2017 and 2016 acquisitions, including the step up in the value of acquired inventory and acquisition transaction costs that are required to be expensed as incurred.

38 THIRD QUARTER PERIOD Period Ending July 31, 2017 (Unaudited) NORDSON CORPORATION RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Dollars in thousands except for per-share amounts) EBITDA and EBITDA per diluted share Third Quarter Year-to-Date Net income $ 101,456 $ 84,214 $ 215,967 $ 195,976 Adjustments: Depreciation and amortization expense 25,954 17,662 65,366 52,824 Interest expense, net 11,038 4,471 24,041 14,989 Income taxes 40,999 33,023 91,454 67,154 EBITDA $ 179,447 $ 139,370 $ 396,828 $ 330,943 Adjustments: Acquisition costs and adjustments (1) 2,252-17,898 1,888 EBITDA As Adjusted $ 181,699 $ 139,370 $ 414,726 $ 332,831 EBITDA per diluted share $ 3.08 $ 2.42 $ 6.82 $ 5.76 EBITDA As Adjusted per diluted share $ 3.12 $ 2.42 $ 7.13 $ 5.80 (1) Represents one-time costs associated with our 2017 and 2016 acquisitions, including the step up in the value of acquired inventory and acquisition transaction costs that are required to be expensed as incurred. EBITDA and EBITDA per diluted share are non-gaap financial measures used by management to evaluate the Company's ongoing operations. EBITDA is defined as earnings before interest, taxes, depreciation and amortization and EBITDA As Adjusted is defined as EBITDA plus certain acquisition costs and adjustments. EBITDA per diluted share is defined as EBITDA divided by the Company's diluted weighted average shares outstanding. EBITDA As Adjusted per diluted share is defined as EBITDA As Adjusted divided by the Company's diluted weighted average shares outstanding. Third Quarter Year-to-Date Diluted EPS as reported (U.S. GAAP) $ 1.74 $ 1.46 $ 3.71 $ 3.41 Short-term inventory purchase accounting adjustments Acquisition costs Severance and restructuring Litigation settlement (0.01) Discrete tax items - (0.03) 0.04 (0.19) Other pre-tax items related to discrete tax benefits (0.01) Diluted EPS as adjusted (Non-GAAP) $ 1.78 $ 1.47 $ 3.99 $ Adjusted Diluted EPS is not a measurement of financial performance under GAAP, and should not be considered as an alternative to EPS determined in accordance with GAAP. Management believes that EPS as adjusted to exclude the items in the table above assist in understanding the results of Nordson Corporation. Our calculations of this non-gaap financial measure may not be comparable to the calculations of similarly titled measures reported by other companies.

39 NORDSON CORPORATION ORDER RATES FOR 12-WEEK PERIOD ENDING AUGUST 13, 2017 CHANGE FROM PRIOR YEAR BUSINESS SEGMENT % CHANGE GEOGRAPHY % CHANGE Adhesive dispensing systems -1% United States -6% Advanced technology systems -3% Americas 5% Industrial coating systems -4% Europe 12% Japan -20% Total -2% Asia Pacific -6% Total -2% Notes: 1. Numbers in this table are unaudited and exclude the effects of currency movements. 2. Pro-forma changes in order rates were calculated as though our 2017 and 2016 acquisitions were owned in both years. 39

40 Numbers as reported and do not factor in stock splits Appendix: Currency Impact Annual Sales Growth and EPS 30% 20% Volume Growth Currency Effect EPS Currency Effect 10% 0% -10% -20% -30% $.11 (.10) (.23) (.11) (.09) (.06) (.54) (.19) 40 1% impact on revenue due to FX equals approximately 2.5% impact on EPS