Nvent Electric Plc · NYSE:NVT
Nvent Electric — Q2 2024 Earnings Presentation
20 slides from Nvent Electric's earnings presentation, Aug 6, 2024
Slide 1: nVent Second Quarter 2024 Earnings Presentation
nVent Second Quarter 2024 Earnings Presentation August 6, 2024 1
Slide 2: Forward-Looking Statement and Key Definitions
Forward-Looking Statement and Key Definitions Caution Concerning Forward-Looking Statements This presentation contains statements that we believe to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of hi
Slide 3: Key Messages
Key Messages Delivered record quarterly sales of $880M, up 10%; adjusted EPS up 6% Grew adjusted operating income double digits with robust cash flow Announced agreement to sell Thermal Management business Completed acquisition of Trachte, a new platform for nVent Updating full-year guidance Strong
Slide 4: Q2 2024 Summary
Q2 2024 Summary ▪ Sales of $880 million, up 10% and 4% organically; volume contributed 4 points ▪ Adjusted operating income of $202 million, up 12%; ROS of 23.0%, up 40 bps Q2 2024 ▪ Adjusted EPS of $0.82, up 6% ▪ Free cash flow generation of $112 million, up 81% ▪ Organic sales growth led by Infras
Slide 5: Q2 2024 nVent Performance
Q2 2024 nVent Performance Sales ($M) Financial Highlights (YoY) $52 ($4) $880 ▪ Sales up 10%, organically up 4% $30 ($1) $803 - Volume added 4 points to growth +10% YoY - Acquisitions added 6 points to growth ▪ Adjusted operating income up 12% 4 pts 0 pts 6 pts 0 pts Q2 ’23 Volume Price Acq. FX Q2 ’
Slide 6: Q2 2024 Segment Performance
Q2 2024 Segment Performance ($M) Sales Segment Income Commentary Organic sales up; all verticals grew, led by Infrastructure Enclosures $441 $104 North America led organic sales growth Up 10% Up 15% Up 9% organic ROS 23.5% (+100bps) Data Solutions sales up strong double digits; building 2025 b
Slide 7: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow Cash Flow ($M) Debt Summary ($M) $1,778 Maturity Q2 YTD 2024 2024 $500 @ 2028 $1,300 73% Fixed $300 @ 2031 Net Income $ 111 $ 216 Amortization 24 50 $500 @ 2033 Subtotal $ 135 $ 266 $478 27% Variable 2026-2028 Depreciation 14 29 Q2 ’24 Weighted Average Rate ~5% Capital Ex
Slide 8: Capital Allocation Update
Capital Allocation Update Manage Reinvest in Return Cash M&A Leverage the Business to Shareholders ▪ Net debt to adjusted ▪ Full-year capex of $85 to ▪ Acquisitions remain a ▪ Returned $64 million in EBITDA ratio at 1.8X $90 million in 2024 top priority dividends to shareholders ▪ Target of 2.0X to
Slide 9: 2024 nVent Outlook
2024 nVent Outlook Total nVent Expected Drivers ▪ Secular tailwinds in electrification, sustainability and digitalization Guidance as of 05/03/24 Updated Guidance* ▪ Volume growth and positive price Up 8% to 10% Up 11% to 13% ▪ Price and productivity offsetting inflation Sales Up 3% to 5% organic Up
Slide 10: Q3 2024 nVent Outlook
Q3 2024 nVent Outlook Q3 ’24 Q3 ’23 Other Items Reported sales Up 8% to 10% $859M Tax rate ~23% Organic sales Up 2% to 4% flat Net interest expense ~$34M EPS (reported) $0.69 to $0.71 $0.63 Shares ~169M EPS (adjusted) $0.80 to $0.82 $0.84 Expected Drivers ▪ Acquisitions to add ~6 points to sales gro
Slide 11: Our Strategy
Our Strategy One nVent STRATEGIC DRIVERS High-Growth New Products Global Growth Verticals and Innovation Grow Acquisitions and Partnerships Productivity Transform Digital Acceleration Working Capital and Velocity Executing on our strategy to drive growth and performance Q2 ’24 Earnings Presentation
Slide 12: Thermal Management Divestiture
Thermal Management Divestiture Transaction Details ▪ Entered into a definitive agreement to sell Thermal ▪ Expect to close by early 2025, subject to customary Management to funds managed by Brookfield Asset conditions, including regulatory approvals Management ▪ Net proceeds to be deployed to acquis
Slide 13: Acquisition of Trachte
Acquisition of Trachte Company Overview Strategic Fit Trachte is a leading manufacturer of custom-engineered ▪ Expands enclosures portfolio with new platform and control building solutions designed to protect critical enhances our systems protection capability infrastructure assets. ▪ Further streng
Slide 14: nVent Portfolio Transformation
nVent Portfolio Transformation 2019 2020 2021 2023 2024 Future nVent* ▪ Building a more sustainable and electrified world Renewables ▪ >70% of portfolio Commercial & Power Utilities, Industrial Data Solutions Infrastructure Data Centers, exposed to secular Automation Renewables trends Announced Sale
Slide 15: Summary
Summary ▪ Another strong quarter ▪ Executing well on our strategy ▪ Transforming the portfolio ▪ Updating guidance 1 5 Well positioned with electrification, sustainability and digitalization trends Q2 ’24 Earnings Presentation 15
Slide 16: Appendix and GAAP to Non-GAAP Measurements & Reconciliations
Appendix and GAAP to Non-GAAP Measurements & Reconciliations 16 16
Slide 17: Reported to Adjusted 2024 Reconciliation
Reported to Adjusted 2024 Reconciliation Q2 ’24 Earnings Presentation * This updated guidance includes the acquisition of Trachte and does not reflect the pending 17 divestiture of the Thermal Management business.
Slide 18: Reported to Adjusted 2023 Reconciliation
Reported to Adjusted 2023 Reconciliation Q2 ’24 Earnings Presentation 18
Slide 19: Reported to Adjusted 2022 Reconciliation
Reported to Adjusted 2022 Reconciliation Q2 ’24 Earnings Presentation 19
Slide 20: Organic Sales Growth and Free Cash Flow Reconciliation
Organic Sales Growth and Free Cash Flow Reconciliation Q2 ’24 Earnings Presentation 20