Gardner Denver Investor Presentation. UBS Conference, June 2018 Vicente Reynal, CEO Todd Herndon, CFO

Transcription

1 Gardner Denver Investor Presentation UBS Conference, June 2018 Vicente Reynal, CEO Todd Herndon, CFO

2 Disclaimer Forward-Looking Statements During the course of this presentation, we may make forward-looking statements within the meaning of the US federal securities laws. In fact, all statements made during this presentation other than statements of historical fact are forward-looking statements. Words such as expects, anticipates, believes, estimates, plans, intends, projects and indicates and variations of such words or similar expressions are intended to identify forward-looking statements. Although they reflect our current expectations, these statements are not guarantees of future performance, and actual results may differ materially from what is expressed in or indicated by these forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in such forward-looking statements, including those risks and uncertainties described under the section titled Risk Factors in our Form 10-K for the fiscal year ending December 31, 2017, filed with Securities and Exchange Commission ( SEC ) on February 16, 2018, which risks and uncertainties may be updated from time to time in our periodic filings with the SEC (accessible on the SEC s website at Forward-looking statements speak only as of the date the statements are made. The Company does not undertake to update any forward-looking statements as a result of future developments or new information, except as required by law. Non-GAAP Financial Measures Included in this presentation are certain non-gaap financial measures designed to supplement, and not substitute, the financial information presented in accordance with generally accepted accounting principles in the United States of America because management believes such measures are useful to investors. Examples of non-gaap measures include Adjusted EBITDA and Unlevered Free Cash Flow. For a reconciliation of these non-gaap measures refer to "Adjusted EBITDA Reconciliation" and Unlevered Free Cash Flow Conversion Reconciliation in the Appendix. 2

3 Company Snapshot World-class Flow Control and Compression Business with Leading Market Positions, Geographic and End Market Diversification, Underpinned by Strong Company Execution 2017 Overview ~$2.4B 23.6% 41% #1 - #3 ~$25B Asset-light Revenue Adj. EBITDA Margin Aftermarket Position in Our Markets 1 Total Addressable Market 1 Avg. Capex ~2%-3% of Revenue 2017 Financial Overview 2017 Revenue Breakdown ($M) Industrials Energy Medical Revenue $1,131 $1,015 $230 Adj. EBITDA $243 $296 $62 Adj. EBITDA Margin 21.5% 29.2% 27.1% % of Total Revenue 48% 42% 10% Growth Expectation/Driver GDP+ GDP+ / Activity & Intensity GDP+ By Geography 2 By End Market 3 EMEA 36% APAC 13% Americas 51% 4% 3%3% 6% 7% 7% 12% 24% 34% Industrial Manufacturing Energy Transportation Medical Lab Chemical Food & Beverage Environmental Mining & Construction Other 1 Market positions and TAMs per management estimates. 2 Geographic regions are grouped into the Americas; EMEA; and APAC. 3 Classification of end markets for sales made through independent distributors (rather than through direct sales to end market users) is based on management s assessment of the distribution channels through which such sales are made. 3

4 $43 5 $42 5 $41 5 $40 5 $39 5 $38 5 $37 5 $36 5 $35 5 $34 5 $33 5 $32 5 $31 5 $30 5 $29 5 $28 5 $ % 25. 0% 20. 0% 15. 0% 10. 0% 5.0 % 0.0 % Financial Performance Driving Profitable Revenue Growth and Steady Cash Flow Generation ($M) LTM Revenue LTM Adj. EBITDA & Margin $2,288 $2,375 $2,513 $461 $537 $562 $618 $2, % 23.5% 23.6% 24.6% Q Q Q Q Q Q Q Q Y/Y % +8% +22% +22% +27% +29%/+360 bps +56%/+520 bps +40%/+290 bps +48%/+360 bps LTM Adjusted Net Income LTM Unlevered Free Cash Flow¹ $215 $249 $310 $391 $384 $414 $424 $154 Q Q Q Q Q Q Q Q Y/Y % +66% +149% +87% +128% +14% +15% +10% +15% ¹ Unlevered free cash flow is defined as Adj. EBITDA less capex plus in operating working capital 4

5 Key Strategic Framework Deploy Talent Accelerate Growth Expand Margins Allocate Capital Effectively 5

6 Voice of the Shareholder Common Themes Upstream Energy Exposure & Opportunity for Ongoing Growth? Target Leverage Level & Free Cash Flow Priorities? 1 Portfolio Composition & M&A Priorities? 1 Leverage Defined as (Net Debt) / (LTM Adjusted EBITDA) 6

7 Appendix

8 Adjusted EBITDA Reconciliation LTM Q LTM Q LTM Q LTM Q ($ M) NET INCOME (LOSS) $67.7 $18.5 ($129.5) ($170.6) Plus: Interest expense Income Tax Benefit ($106.1) ($131.2) ($39.7) ($53.3) Depreciation Expense Amortization Expense $122.2 $118.9 $121.0 $122.2 Impairment of Goodwill and Other Intangible Assets Sponsor Fees $16.2 $17.3 $18.3 $20.1 Restructuring and related business transformation costs Acquisition related expenses and non-cash charges $8.0 $4.1 $3.8 $4.6 Environmental remediation loss reserve (0.1) Expenses related to initial stock offering $4.3 $4.1 $3.7 $3.2 Establish public company financial reporting compliance Stock-based Compensation $197.0 $194.2 $166.0 $156.2 Loss on Extinguishment of Debt Foreign currency transaction losses (gains), net $11.3 $9.3 $3.0 $1.8 Other Adjustments Adjusted EBITDA $617.5 $561.5 $537.2 $

9 Unlevered Free Cash Flow Reconciliation ($M) LTM Q LTM Q LTM Q LTM Q Adj. EBITDA $ $ $ $ ( - ) Capex (75.2) (64.5) (56.8) (50.5) ( + ) Change in Operating Working Capital¹ 4.5 (88.7) (90.4) (142.8) Unlevered Free Cash Flow $ $ $ $ ¹ Operating Working Capital is defined as: Accounts Receivable, net plus Inventories, net less Accounts Payable 9