Slide 1: nVent Second Quarter 2019 Earnings Presentation
nVent Second Quarter 2019 Earnings Presentation August 1, 2019
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: Executive Summary
Executive Summary Sales of $540 million grew 1% organically ROS was 19.4% Q2 ‛19 Adjusted EPS of $0.44 ~$153 million of share repurchases in Q2; Repurchased ~5% of shares outstanding in 1H Enclosures and EFS continued organic growth of 3% Q2 Segment Price + productivity more than offset
Slide 4: Our nVent Strategy
Our nVent Strategy One nVent Accelerate Innovation and Grow Globally and in Focus on Attractive Verticals Connected Solutions Developing Regions Drive Productivity and Velocity Pursue Targeted Bolt-on Acquisitions Driving a strategy for growth and performance Q2 ’19 Earnings Presentation 4
Slide 5: Q2 '19 nVent Performance
Q2 ’19 nVent Performance Sales ($ in millions) Financial Highlights (YoY) $9 $0 Organic Sales up 1% $543 $540 ($2) ($10) (~1%) Price + productivity more than offset inflation YoY Segment Income down 2% • Thermal Management headwinds -1 pt 2 pts 0 pts -2 pts Q2 ’18 Volume Price Acq. FX Q2 ’19
Slide 6: Q2 '19 Segment Performance
Q2 ’19 Segment Performance Sales Segment Income Commentary ($M) Enclosures Strong growth in Data Center & Networking Solutions $260 $48 Up 2% Up 1% Successful launch of HOFFMAN on Demand Up 3% organic ROS 18.5% ─ Signs of slowdown in Industrial vertical Thermal Mgmt Industrial MRO grew double
Slide 7: Deeper Dive Into Thermal Management Performance
Deeper Dive Into Thermal Management Performance Over the last three years: • Projects declined due to softer Energy vertical • Good growth in higher margin Commercial and Industrial MRO • Solid profit contribution and ROS expansion Industrial MRO Projects Commercial LTM Revenue ($M) ~$195 ~$220 ~$
Slide 8: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow Cash Flow ($M) Debt Summary $1,062M Maturity Q2 YTD 2019 2019 Net Income $ 61 $ 117 $800M $300M @ 2023 75% Fixed Amortization 15 30 $500M @ 2028 Subtotal $ 76 $ 147 Depreciation 9 17 $262M Capital Expenditures (8) (18) 25% Variable 2023* Working Capital (30) (112) Q2 ’19
Slide 9: Q3 '19 nVent Outlook
Q3 ’19 nVent Outlook Q3 ‘19 Q3 ’18 Other Items Organic Sales -1% - +2% $564M Tax Rate ~18% EPS (reported) $0.40 - $0.44 $0.38 Net Interest Expense ~$12M EPS (adjusted) $0.47 - $0.51 $0.46 Shares ~172M Summary Predicting slowdown within the Industrial vertical Expect Thermal Management to remain
Slide 10: Full-Year 2019 nVent Outlook
Full-Year 2019 nVent Outlook Total nVent* Organic Sales by Segment* Original Guidance Updated Guidance Original Guidance Updated Guidance Enclosures Up 2 - 4% Up 1 - 3% Organic Up 2 - 4% Flat - Up 2% Sales Thermal Up 2 - 6% Down 2 - Up 2% Management EFS Up 2 - 4% No change ROS +40 - 60 bps +30 - 60
Slide 11: 2019 Priorities
2019 Priorities • Accelerate One nVent initiatives Organic Growth • Drive key verticals • Grow with new products • Deliver price + productivity to offset inflation Margin Expansion • Drive supply chain efficiencies • Return cash in form of dividends and repurchases Capital Allocation • Focus on accr
Slide 12: nVent Agrees to Acquire Eldon
nVent Agrees to Acquire Eldon Overview State of the Art Manufacturing ~$90M 2018 revenue* State of the art manufacturing Founded in 1922 in Sweden Headquartered in Spain Purchase price: ~$130M Rationale Strong IEC Product Portfolio Accelerate Enclosures growth through… Expanded portfolio
Slide 13: Summary
Summary We are a Leader in Connection and Protection 3 percent organic sales growth in both Enclosures and EFS Negative volume and mix within Thermal Management impacted sales and margin Continue to execute on our strategic growth initiatives Productivity and cost actions ramping in the 2H
Slide 14: Appendix and GAAP to Non-GAAP Measurements & Reconciliations
Appendix and GAAP to Non-GAAP Measurements & Reconciliations
Slide 15: Reported to Adjusted 2019 Reconciliation
Reported to Adjusted 2019 Reconciliation nVent Electric plc Reconciliation of the GAAP year ended December 31, 2019 to the non-GAAP financial measures excluding the effect of 2019 adjustments (Unaudited) Actual Forecast (1) In millions, except per-share data First Quarter Second Quarter Third Quarte
Slide 16: Reported to Adjusted 2018 Reconciliation
Reported to Adjusted 2018 Reconciliation nVent Electric plc Reconciliation of the GAAP year ended December 31, 2018 to the non-GAAP financial measures excluding the effect of 2018 adjustments (Unaudited) In millions, except per-share data First Quarter Second Quarter Third Quarter Fourth Quarter Ful
Slide 17: Organic Sales Growth & Free Cash Flow Reconciliation
Organic Sales Growth & Free Cash Flow Reconciliation nVent Electric plc Reconciliation of Net Sales Growth to Organic Net Sales Growth by Segment for the quarter ended June 30, 2019 (Unaudited) Actual Q2 Net Sales Growth Organic Currency Acq./Div. Total nVent 1.4% (2.0%) —% (0.6%) Enclosures 3.3% (1