Slide 1: Investor Presentation May 10, 2023
INVESTOR PRESENTATION INVESTOR PRESENTATION May 10, 2023
Slide 2: Disclaimers
2INVESTOR PRESENTATION Disclaimers Cautionary Statements Regarding Forward Looking Statements — Certain statements herein about our expectations of future events or results constitute forward- looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform A
Slide 3: AZZ Snapshot
INVESTOR PRESENTATION 3 39% 61% 52% 48% AZZ Snapshot By Sales By EBITDA AZZ is North America’s largest independent hot-dip galvanizing and coil coating solutions company with #1 positions in both markets $1.3 billion FY2023 Sales $267.4mm Adj. EBITDA Precoat MetalsMetal Coatings Note: Financial metr
Slide 4: AZZ Provides Technologically Advanced Metal Coatings and Related Value-Added Services
INVESTOR PRESENTATION 4 ` AZZ Provides Technologically Advanced Metal Coatings and Related Value-Added Services 2 METAL COATINGS Protects and extends the life of fabricated steel structures and components from the effects of corrosion, lasting decades Advanced application of protective and decorativ
Slide 5: Investment Thesis
INVESTOR PRESENTATION 5 Investment Thesis North America’s largest independent hot-dip galvanizing and coil coating company Value-added tolling business model protects margins, limits metal commodity exposure, and minimizes NWC intensity 3 Diversified and resilient end markets with secular growth tai
Slide 6: Portfolio Transformation Creates a Focused Market Leader in Protective Coating Solutions
INVESTOR PRESENTATION 6 39% 61% Precoat Metals Metal Coatings 31% 69% AZZ Infrastructure Solutions Metal Coatings Portfolio Transformation Creates a Focused Market Leader in Protective Coating Solutions with High Margins AZZ in 20191 AZZ Today2 23.3% Adj. EBITDA Margin3 ~$309mm Adj. EBITDA3 ~$163mm
Slide 7: #1 in Hot-Dip Galvanizing and Coil Coating Businesses
INVESTOR PRESENTATION 7 20% 80% AZZ Competitors #1 in Hot-Dip Galvanizing and Coil Coating Businesses Across Large and Diverse Served Markets Market Position Addressable Market METAL COATINGS PRECOAT METALS ~$2.1 billion ~$3.7 billion Capabilities Galvanizing, powder coatings, plating, anodizing Con
Slide 8: North America's Largest Independent Hot-Dip Galvanizing and Coil Coating Company
INVESTOR PRESENTATION 8 Metal Coatings Locations (46) Precoat Metals Locations (13) North America’s Largest Independent Hot-Dip Galvanizing and Coil Coating Company Scale and Proximity to Customers Drives Significant Cost and Service Advantages 6
Slide 9: Trusted Long-Term Partner to Large, Blue Chip Customer Base
INVESTOR PRESENTATION 9 Trusted Long-Term Partner to Large, Blue Chip Customer Base Growing Base of Over 3,000+ Customers Diverse Customer Profile, No Single Customer >5% of Sales 85%+ of Top 25 Customers’ Relationships Span 10+ Years Construction & Building Products 7 HVAC and Appliances Transmissi
Slide 10: Diverse and Balanced End Market Exposure
INVESTOR PRESENTATION 10 Diverse and Balanced End Market Exposure Infrastructure Machinery / Trans.Industrial Renewable/Utility Bridge and HwyHVACResidential Construction Appliance Agriculture Commercial Construction 8 Construction 51% Industrial 12% Consumer 8% Transportation 10% Electrical Utility
Slide 11: Secular Drivers Enhancing Outlook
INVESTOR PRESENTATION 11 Secular Drivers Enhancing Outlook INFRASTRUCTURE AND RENEWABLES INVESTMENT RESHORING MANUFACTURING PREPAINTED STEEL AND ALUMINUM MIGRATION CONVERSION FROM PLASTICS TO ALUMINUM 9
Slide 12: Significant Macro Tailwinds from the American Infrastructure Investment and Jobs Act
INVESTOR PRESENTATION 12 Significant Macro Tailwinds from the American Infrastructure Investment and Jobs Act Roads, Bridges and Major Projects 10 Clean Energy and Power Water, Airports and Other Investment: $110bn Investment: $65bn Investment: +$75bn Investment to repair over 45,000 bridges and 1 i
Slide 13: Limited Metal Commodity Exposure: Tolling Model
INVESTOR PRESENTATION 13 0 50 100 150 200 2 0 1 4 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2 0 2 0 2 0 2 1 Zinc ($/ton) Metal Coating Sales ($mm) Limited exposure to metal price Value-added pricing model Highly variable cost structure with flexible operating model Consistent strong earnings and cash
Slide 14: Both Businesses Have Delivered Robust Top-line Growth and Profitability
INVESTOR PRESENTATION 14 $138 $126 $157 $189 $86 $95 $137 $120 $224 $221 $294 $309 21.1% 21.5% 24.2% 23.3% FY20 FY21 FY22 FY23 Both Businesses Have Delivered Robust Top-line Growth and Profitability 12 Sales Adj. EBITDA1 $499 $457 $519 $637 $561 $572 $699 $687 $1,060 $1,029 $1,218 $1,324 FY20 FY21 F
Slide 15: Leadership Team and Mission
INVESTOR PRESENTATION 15 Tom Ferguson President and Chief Executive Officer Philip Schlom Chief Financial Officer David Nark SVP of Marketing, Communications and Investor Relations Matt Emery Chief Information and Human Resources Officer Tara Mackey Chief Legal Officer Chris Bacius Vice President Bu
Slide 16: Committed to ESG & Sustainability
INVESTOR PRESENTATION 16 16 Committed to ESG & Sustainability Environmental Social Governance Committed to Sustainability Extensive re-use and recycling of zinc, aluminum, steel, water and chemical solutions Launching baseline Scope 3 supply chain sustainability survey in FY2024 ~51.6% of our employ
Slide 17: Financial Overview
INVESTOR PRESENTATION Financial Overview 15
Slide 18: Premier Margin and Cash Flow Profile
INVESTOR PRESENTATION 18 77% 63% 79% 62% AZZ Coatings Service Centers Steel Mills Premier Margin and Cash Flow Profile 16 3-Year Median EBITDA Margin3 3-Year Median FCF Conversion (EBITDA less Capex / EBITDA) ✔ Differentiated solutions command strong gross margins ✔ Flexible, efficient operating mod
Slide 19: Proven Resilience Through Challenging Cycles
INVESTOR PRESENTATION 19 Proven Resilience Through Challenging Cycles ~25% ~75% Fixed Variable 17 Highly Variable Cost Structure Diverse End Market Exposure Performed Well Through Global Financial Crisis Metal Coatings EBITDA Precoat Metals EBITDA $51 $81 $85 $85 $98 $51 $59 $42 $57 $71 $102 $140 $1
Slide 20: Rapid Deleveraging Profile
INVESTOR PRESENTATION 20 4.25x 3.5x 3.0x 3.0x 2.5x At Close Current Target Range Capital structure with no maturities until 2027 Strong cash flow generation supports near-term deleveraging priority Business expected to generate ~$200mm in free cash flow in first year post-close Transaction tax attri
Slide 21: Our Capital Allocation Priorities
21INVESTOR PRESENTATION Our Capital Allocation Priorities Acquisitions Opportunistic, highly accretive bolt-on acquisitions Return Capital Committed to sustaining dividends High ROIC Investments Organic growth Strategic customer partnerships Productivity Reduce Leverage 3.0x leverage by
Slide 22: High ROIC Strategic Investment: New Precoat Coating Line
22INVESTOR PRESENTATION High ROIC Strategic Investment: New Precoat Coating Line Enables Precoat to benefit from secular shift to aluminum cans Sales of $60+ million by 2026 at an EBITDA margin above Precoat overall margin ROIC well in excess of return of cost of capital Long-term contractua
Slide 23: FY2024 Guidance
INVESTOR PRESENTATION 23 21 Note: FY based on February year-end 1. FY2024 guidance excludes equity income from AZZ’s minority interest in the AIS JV.. The AIS JV comprises the Company’s Infrastructure Solutions segment. FY2024 guidance does not include the impact of any potential future acquisitions
Slide 24: Current Strategy
INVESTOR PRESENTATION 24 Current Strategy Drive Organic Growth 1 • Continued emphasis on customer service and quality • Invest in capacity to support specific customer demand Sustain Target EBITDA Range2 • Metal Coatings EBITDA 25-30% • Precoat Metals EBITDA 17-22% Rapidly De-lever and De-risk4 Stro
Slide 25: Appendix
INVESTOR PRESENTATION Appendix 23
Slide 26: Reg "G" Tables
Reg “G” Tables 26
Slide 27: Continuing Operations Non-GAAP Disclosure
Continuing Operations Non-GAAP Disclosure Three Months ended February 28, Year Ended February 28, 2023 2022 2023 2022 Amount Per Diluted Share(1) Amount Per Diluted Share(1) Amount Per Diluted Share(1) Amount Per Diluted Share(1) Net income from continuing operations $ 7,427 $ — $ 11,322 $ — $ 66,33
Slide 28: Non-GAAP Disclosure of Continuing Operations Adjusted EBITDA
Non-GAAP Disclosure of Continuing Operations Adjusted EBITDA Three Months Ended Year Ended February 28, February 28, 2023 2022 2023 2022 Net income from continuing operations $ 7,427 $ 11,322 $ 66,339 $ 49,817 Interest expense 27,061 1,345 88,800 6,363 Income tax (benefit) expense 3,956 4,436 22,336
Slide 29: Non-GAAP Segment Disclosure from Continuing Operations
Non-GAAP Segment Disclosure from Continuing Operations (Metal Coatings and Precoat Metals) Three Months Ended Year Ended February 28, February 28, 2023 2022 2023 2022 Metal Coatings Operating income $ 32,141 $ 31,960 $ 155,954 $ 128,758 Depreciation and amortization expense 8,170 7,843 32,955 30,453