Slide 1: Knowles Q4 2023 Earnings Conference Call
« knowles February 7, 2024
Slide 2: Forward Looking Statements and Non-GAAP Disclaimer
Forward Looking Statements Non-GAAP Disclaimer
Slide 3: Q4 2023 Highlights
• Revenue of $215 million up 9% versus the prior year driven by the Cornell Dubilier acquisition • Non-GAAP Diluted EPS of $0.28, down $0.05 versus the prior year driven by lower factory capacity utilization in Precision Devices • Cash from operations of $60 million up $14 million versus the prior y
Slide 4: Precision Devices: Cornell Dubilier acquisition completed
• Successfully completed the acquisition of Cornell Dubilier which significantly expands our total available market for capacitors in key markets and drives opportunities for future growth. • 10% revenue growth year over year driven by Cornell Dubilier acquisition • Gross Profit Margin down from the
Slide 5: MedTech & Specialty Audio: revenue up 9%
• Revenue up 9% due to increased demand in the hearing health market. • Gross Profit Margin expansion driven by favorable factory productivity improvements, product mix and FX benefits
Slide 6: Consumer MEMS Microphones: revenue up 8%
• Revenue is up 8% versus the prior year driven by higher shipments into mobile and compute • Delivered three quarters consecutive of sequential revenue growth in 2023
Slide 7: Full Year 2023 Cash Generation
Full Year 2023 Cash Generation Proven ability to deliver strong free cash flow . . FREE CASH FLOW* Gross Margin Expansion + Focused on markets that value our technology and ($m) 133.5 manufacturing differentiation Expense Control focusing more heavily on Precision Devices and MedTech 2019 2020 2021
Slide 8: Outlook
Outlook Q1 2024 GAAP results are expected to include approximately $0.06 per share in stock-based compensation and $0.05 per share in amortization of intangibles, and $0.03 per share in integration and production transfer costs related to the acquisition of Cornell Dubilier that are excluded from No
Slide 9: Appendix
4« knowles Appendix
Slide 10: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures Quarter Ended December 31, (in millions, except per share amounts) 2023 2022 Revenues $ 215.2 $ 197.1 Notes: Gross profit $ 78.4 $ 75.3 (1) Production transfer costs represent duplicate costs incurred to migrate manufacturing t
Slide 11: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures Quarter Ended December 31, Notes: (in millions, except per share amounts) 2023 2022 (4) The non-GAAP reconciling adjustments are those adjustments made to reconcile Earnings (loss) Net earnings (loss) $ 47.4 $ (208.0) Interest
Slide 12: Historical Segment Data
Historical Segment Data Precision Devices MedTech & Specialty Audio Consumer MEMS Microphones Quarter Ended Quarter Ended Quarter Ended December 31, September 30, June 30, March 31, December 31, December 31, September 30, June 30, March 31, December 31, December 31, September 30, June 30, March 31,
Slide 13: Historical Segment Data
Historical Segment Data Precision Devices MedTech & Specialty Audio Consumer MEMS Microphones Quarter Ended Quarter Ended Quarter Ended December 31, September 30, June 30, March 31, December 31, December 31, September 30, June 30, March 31, December 31, December 31, September 30, June 30, March 31,
Slide 14: Reconciliation of Segment EBIT to Consolidated Net Earnings
Reconciliation of Segment EBIT to Consolidated Net Earnings Quarter Ended December 31, September 30, June 30, March 31, December 31, (in millions) 2023 2023 2023 2023 2022 Earnings (loss) before interest and income taxes Precision Devices $ 3.4 $ 6.1 $ 4.8 $ 10.7 $ 16.6 MedTech & Specialty Audio 28.
Slide 15: Free Cash Flow and Free Cash Flow as a % of revenues
Free Cash Flow and Free Cash Flow as a % of revenues Years Ended December 31, (in millions) 2023 2022 2021 2020 2019 Net cash provided by operating activities $ 122.7 $ 86.3 $ 182.1 $ 128.1 $ 123.9 Net cash provided by operating activities as a % of revenues 17.3 % 11.3 % 21.0 % 16.8 % 14.5 % Less:
Slide 16: Reconciliation of Net Debt (Cash)
Reconciliation of Net Debt (Cash) Year Ended December 31, (in millions) 2023 Current maturities of long-term debt $ 47.1 Long-term debt 224.1 Total debt 271.2 Less: Cash and cash equivalents (87.3) Net debt $ 183.9