Dover Corporation · NYSE:DOV
Dover — Q2 2021 Earnings Presentation
23 slides from Dover's earnings presentation, Jul 20, 2021
Slide 1: Earnings Conference Call Second Quarter 2021
Earnings Conference Call Second Quarter 2021 July 20, 2021 9:00am CT Exhibit 99.2
Slide 2: Forward-Looking Statements and Non-GAAP Measures
2 Forward-Looking Statements and Non-GAAP Measures We want to remind everyone that our comments may contain forward-looking statements that are inherently subject to uncertainties and risks, including the impacts of the novel coronavirus (COVID-19) on the global economy and on our customers, supplie
Slide 3: Q2 2021 Highlights
3 YTD Free Cash Flow(1) +450 bps Adj. Segment EBIT Margin(1) to 19.7% +$96M Y-o-Y +80bps to 9.3% of Revenue Q2 2021 Highlights (1) Non-GAAP measures (definitions and reconciliations in appendix) (2) See performance measures definitions in appendix (3) Refer to definition of total segment earnings (E
Slide 4: Summary Corporate Q2 Results
4 Summary Corporate Q2 Results Q2 2021 Highlights and Comments Revenue change (Y-o-Y) All-in Organic(1) +36% +30% Y-o-Y growth in all segments Q2 FX impact: +5%; acquisitions +1% Bookings change (Y-o-Y) All-in(2) Organic(2) +68% +61% Q2 book-to-bill(2): 1.17; bookings up Y-o-Y in all five segments B
Slide 5: Segment Revenue and Adjusted EBIT Performance Commentary
5 Segment Revenue ($M) / Organic Change % Adj. EBIT % / Y-o-Y Organic Revenue Change Performance Commentary DEP $442 +25% 15.2% +0 bps +0% Top line strength in vehicle aftermarket, industrial automation, and aerospace & defense; recovery in industrial winches; waste handling flat on shipment timing
Slide 6: Q2 2021 Revenue and Bookings Bridges
6 Q2 2020 Revenue & Bookings Q2 2021 Revenue Change in Organic Revenue(1): +$445M, or +29.7% DIIDFS DPPS DRFE FX ACQ./ DISP. (2) Q2 2021 DEP ACQ./ DISP. (3) DRFEQ2 2020 DFS DII DPPS FX Q2 2021 Note: $ in millions. Numbers may not add due to rounding Q2 2021 Bookings(4) Change in Organic Bookings(4):
Slide 7: Q2 2021 Adjusted Segment EBIT and Adjusted Net Earnings
7 Q2 2021 Adjusted Segment EBIT and Adjusted Net Earnings CORP. EXPENSE GAAP EARNINGS ACQ. AMORT. ADJ. ON SALE OF CHINO RIGHT SIZING ADJ. EARNINGS SEGMENT EBIT INT./TAX EXPENSE ADJ. EARNINGS ACQ. AMORT. RIGHT SIZING GAAP EARNINGS Change in Adjusted Net Earnings (3) +$135M 125 13 1 26 164 173 -14 -24
Slide 8: YTD 2021 Free Cash Flow
8 YTD 2021 Free Cash Flow 12.3% (1) Includes stock-based compensation and changes in other current and non-current assets and liabilities (2) Non-GAAP measures (reconciliations and definitions in appendix) Note: Numbers may not add due to rounding $M Net earnings 497 301 +196 D&A 145 136 +9 Adjustme
Slide 9: H2 Outlook for Key Performance Drivers
9 Segment Market / Demand Operations1 Price Cost Mix H2 2021 Comments DEP Robust backlogs in vehicle aftermarket and waste handling Largest materials cost headwind in the portfolio Supply chain and hiring constraints DFS US EMV headwind; growth in software/systems, underground; vehicle wash - mix fr
Slide 10: Capital Deployment Update
10 Select Capex Projects Acquisitions DEP ESG VSG Productivity Safety Paint line upgrade Floor plan optimization DFS DFS Efficiency Global product platform harmonization Digital Secure wireless communications DII M-I Capacity Efficiency India facility consolidation and expansion Digital Brand protec
Slide 11: FY2021 Guidance Update
11 FY2021 Guidance Update (1) Non-GAAP measure (definition and/or reconciliation in appendix) (2) Mid-point Euro/Dollar assumption: 1.19 Post-Q1 Guide Revised Guide All-in Revenue Growth 10-12% 15-17% EPS GAAP Adj.(1) $5.92 - $6.02 $6.75 - $6.85 $6.45 - $6.55 $7.30 - $7.40 Tax rate 21% - 22% No chan
Slide 12: Appendix
12 Appendix
Slide 13: Organic Revenue and Bookings Bridges
13 Organic Revenue and Bookings Bridges Revenue Bookings 25.4% 73.5% 24.9% 33.5% 20.2% 26.6% 33.6% 81.7% 43.5% 83.1% 29.7% 61.2% 1.3% 2.0% 0.0% 0.0% 4.5% 5.0% Total 35.5% 68.2% Q2 2021 Q2 2021 YTD 25.0% 15.4% 49.6% 24.7% 29.8% 20.6% 37.6% 29.0% 43.0% 17.8% 29.7% 18.7% 1.3% 1.3% 0.0% -0.2% 4.5% 3.8%
Slide 14: Q2 2020 to Q2 2021 Revenue and Bookings Bridges by Segment
14 Q2 2020 to Q2 2021 Revenue and Bookings Bridges by Segment Note: Numbers may not add due to rounding DEP DFS DII DPPS DRFE Total 342 326 228 309 294 1,499 87 81 46 104 128 445 13 15 17 14 9 68 - 14 3 2 - 19 442 437 294 429 431 2,032 DEP DFS DII DPPS DRFE Total 278 311 221 276 326 1,413 205 104 59
Slide 15: Organic Revenue Growth and Q2 2021 vs. Q2 2019 Comparison
15 Organic Revenue Growth and Q2 2021 vs. Q2 2019 Comparison Note: Numbers may not add due to rounding Segment Growth Factors Q2 Organic Growth Q2 '21 vs. Q2 '19 2020 2021 Organic Growth -20.1% 25.4% 0.3% -14.8% 24.9% 6.4% -14.0% 20.2% 3.3% -8.8% 33.6% 21.8% -20.2% 43.5% 14.5% -16.0% 29.7% 9.0% 0.7%
Slide 16: Reconciliation of Q2 2021 Net Earnings to Adj. EBIT and Adj. EBITDA
16 Reconciliation of Q2 2021 Net Earnings to Adj. EBIT and Adj. EBITDA and Calculation of Adj. EBIT Margin and Adj. EBITDA Margin by Segment (1) Adjusted depreciation and amortization expense excludes depreciation and amortization included within rightsizing and other costs DEP DFS DII DPPS DRFE Tot
Slide 17: Reconciliation of Q2 2020 Net Earnings to Adj. EBIT and Adj. EBITDA
17 Reconciliation of Q2 2020 Net Earnings to Adj. EBIT and Adj. EBITDA and Calculation of Adj. EBIT Margin and Adj. EBITDA Margin by Segment DEP DFS DII DPPS DRFE Total 342 326 228 309 294 1,499 - - - - - 125 - - - - - 27 - - - - - 28 - - - - - 32 48 47 38 68 11 212 13.9% 14.5% 16.7% 21.9% 3.9% 14.1
Slide 18: Reconciliation of Adjusted Net Earnings to Net Earnings and Adjusted Diluted EPS
18 Reconciliation of Adjusted Net Earnings to Net Earnings and Calculation of Adjusted Diluted EPS under U.S. GAAP Note: Numbers may not add due to rounding ($ in millions, except per share data) Q2 2021 Q2 2020 FY 2020 FY 2019 FY 2018 Net earnings from continuing operations ($) 265 125 683 678 591
Slide 19: Reconciliation of FY 2020, FY 2019, FY 2018 Earnings to Adj. Segment EBIT
19 Reconciliation of FY 2020, FY 2019, and FY 2018 Earnings from Continuing Operations to Adj. Segment EBIT and Calculation of Adj. EBIT Margin FY 2020 FY 2019 FY 2018 6,684 7,136 6,992 683 678 591 127 124 130 108 121 122 158 165 134 Loss on extinguishment of debt - 24 - 1,077 1,112 977 16.1% 15.6%
Slide 20: Reconciliation of Free Cash Flow, EPS to Adjusted EPS, and Adjusted EBIT Conversion Margin
20 Reconciliation of Free Cash Flow, EPS to Adjusted EPS, and Adjusted EBIT Conversion Margin Range 2021 Guidance for Earnings per Share (GAAP) $6.45 $6.55 Acquisition-related amortization, net $0.74 Rightsizing and other costs, net $0.11 2021 Guidance for Adjusted Earnings per Share (Non-GAAP) $7.3
Slide 21: Non-GAAP Definitions
21 Non-GAAP Definitions Definitions of Non-GAAP Measures: Adjusted Net Earnings: is defined as net earnings adjusted for the effect of acquisition-related amortization, rightsizing and other costs, and gain on dispositions. Adjusted Net Earnings Margin: is defined as adjusted net earnings divided by
Slide 22: Performance Measure Definitions
22 Performance Measure Definitions Definitions of Performance Measures: Bookings represent total orders received from customers in the current reporting period. This metric is an important measure of performance and an indicator of revenue order trends. Organic Bookings represent total orders receiv
Slide 23: Slide 23