Ge Vernova Inc. · NYSE:GEV
Ge Vernova — Investor Day (2024)
12 slides from Ge Vernova's investor day presentation, 2024
Slide 1: Caution concerning forward-looking statements
Caution concerning forward-looking statements: This presentation contains "forward-looking statements" – that is, statements related to future events that by their nature address matters that are, to different degrees, uncertain. These forward-looking statements might be identified by words, and var
Slide 2: Financials & Outlook
FINANCIALS & OUTLOOK Ken Parks GE Vernova CFO © 2024 GE Vernova and/or its affiliates. All rights reserved. 2
Slide 3: Our financial strategy
Our financial strategy Disciplined, selective top line growth Driving adj. EBITDA* growth and continued margin expansion Delivering strong FCF* conversion Investment grade rating, continued innovation & strategic capital deployment © 2024 GE Vernova and/or its affiliates. All rights reserved. 3 * No
Slide 4: Building financial momentum to deliver for investors
Building financial momentum to deliver for investors Revenue Adjusted EBITDA margin* Free cash flow* $B % adj. EBITDA* $B ($0.4)B $0.6B MSD org. growth* 34.0 – 35.0 Low-end 33.2 9.0 HSD High-end 1.2 – 1.8 6.0 MSD 29.7 0.7 - 1.1 1.7 0.1 2022 2023 2024E 2025F (1.4) (0.6) -a) -a) -a) -a) -b) -b) 2022 2
Slide 5: Significant EBITDA growth
Significant EBITDA* growth GE Vernova adj. EBITDA* ($B) Key levers firmly in our control High-end MSD1.9 margin 0.8 (0.2) 0.6 2023 Standalone costs 2023 Pro forma-a) Price/(Inflation) Volume Productivity Cost out 2024E Key levers in our control to drive adj. EBITDA* improvement © 2024 GE Vernova and
Slide 6: Segment financial performance
Segment financial performance Revenue EBITDA $B $B 17.4 MSD*-a) +~100bps*-b) 1.7 16.1 1.7 POWER 2022A 2023A 2024E 2022A 2023A 2024E 9.8 Flat*-a) 8.9 WIND 2022A 2023A 2024E (1.0) Approaching profitability (1.7) 2022A 2023A 2024E 6.4 LDD*-a) 5.1 MSD margin 0.2 ELECTRIFICATION 2022A 2023A 2024E (0.2) 2
Slide 7: Increasing recurring revenue from services
Increasing recurring revenue from services Services backlog-a) ($B) Services revenue ($B) Continued growth ~73 ~75 15.0 ~71 13.8 Electrification Wind Power 2021 2022 2023 2022 2023 2024E 5x 2023 services revenue coverage ~45% of total GE Vernova revenue Services generate healthy margins & strong fre
Slide 8: Improving our cost structure
Improving our cost structure Adjusted G&A expenses-a) Key levers $B 0.2 3.3 • Using lean to simplify processes 3.1 2.8 • Leveraging support functions • Outsourcing certain ‘non-core’ activities • Optimizing IT systems • Reducing legal entities 2023 Standalone 2023 Pro Forma-b) By 2028 Costs ~$500M i
Slide 9: Substantial FCF improvement
Substantial FCF* improvement Consistent FCF* growth Balanced capex supporting growth ($B) Capex spend ($B) 2023 to 2025 dynamics Key drivers • Continued adj. EBITDA* growth D&A • Working capital remains a FCF* source range 1.2 – 1.8 • Taxes a headwind going forward ~0.8 ~0.7 0.7 – 1.1 0.1 -a) -a)) 2
Slide 10: Driving further FCF growth with lean
Driving further FCF* growth with lean Leveraging lean to improve services billings Meaningful inventory opportunity Gas Power Example-a) – % billed within 30 days Inventory Balance ($B) ~8.4 ~8.0 75% ~7.4 Finished goods-b) 27% Raw materials 2022 2023 2021 2021 2022 2022 2023 • Avg. bills outstanding
Slide 11: Commitment to investment grade credit rating
Commitment to investment grade credit rating Expected Day 1 Capital Structure Capital Allocation Framework $4.2B CASH-a) $1.9B net pension/benefit deficit-b) Capital Inorganic Organic return to growth Investments $0.1B DEBT INVESTMENT -c) shareholders optionality ~$3.0B expected credit facility GRAD
Slide 12: Outlook by 2028
Outlook by 2028 Revenue growth*-a) Adj. EBITDA margin* FCF* conversion-b) MSD 10% 90-110% • Disciplined equipment • Positive price & volume • Strong earnings quality growth on rising demand • Productivity with lean • Improving working capital • Continued services growth velocity • G&A cost reduction