Ingersoll Rand Inc. · NYSE:IR
Ingersoll Rand — Q4 2021 Earnings Presentation
31 slides from Ingersoll Rand's earnings presentation, Feb 24, 2022
Slide 1: Q4 and Full Year 2021 Earnings Presentation
Ingersoll Rand Q4 and Full Year 2021 Earnings Presentation February 24, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation by Ingersoll Rand Inc. (the “Company” or “Ingersoll Rand”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related the Company‘s expectations regarding the performance
Slide 3: A Premier Industrial Company with Iconic Brands and Market-Leading Positions
A Premier Industrial Company with Iconic Brands and Market-Leading Positions Solidified Compounding Growth Story 1 Accelerated transformation through portfolio optimization and M&A-focused capital allocation strategy Continued Strong Operational Performance in Q4 2 Executed well amidst ongoing chall
Slide 4: Pivoted to Growth and Optimized Portfolio in 2021; Focused on Compounding Earnings
Pivoted to Growth and Optimized Portfolio in 2021; Focused on Compounding Earnings 2021 Key Accomplishments Announced continuation of equity award grants for new employees, furthering commitment to broad-based employee ownership Deploy Talent (previously issued stock grants of $100M in 2017 and $1
Slide 5: We are Positioned to Accelerate our Strategy in 2022
We are Positioned to Accelerate our Strategy in 2022 We believe our proven economic engine will deliver compounding annual results Double-digit Digitization Demand Earnings Growth Generation Product & Quality of Service M&A Earnings Sustainability & Industrial Internet (Price/AMT) Efficiency of Thin
Slide 6: Material Improvement in Adj. EBITDA Margin Profile with More Room to Go
Material Improvement in Adj. EBITDA Margin¹ Profile…with More Room to Go Ingersoll Rand Industrial Technologies and Services (ITS) 23.1% 24.8% 22.6% 21.5% 20.1% 19.4% FY 2019 FY 2020 FY 2021 FY 2019 FY 2020 FY 2021 Precision and Science Technologies (PST) Commentary 30.6% Ex-M&A 29.9% Tremendous m
Slide 7: Ingersoll Rand is a Top ESG Performer
Ingersoll Rand is a Top ESG Performer Make Life Better through environmental stewardship for our employees, customers, communities and planet Operate Sustainably March 2021 TOP 15% “Ingersoll Rand will be recognized as a top-quartile ESG Of Machinery & industrial company as defined by 61 Industries
Slide 8: IRX is our Competitive Differentiator – Q4 2021 Highlights
IRX is our Competitive Differentiator – Q4 2021 Highlights¹ Cost Synergy • Executed $215M in realized cost synergies since IR merger close Capture² • On track to deliver $300M commitment Strong momentum • Orders: Up 24% YoY; strong organic growth across both segments (ITS Orders and +19% & PST +14%)
Slide 9: Q4 2021 Financial Performance vs. Q4 2020
Q4 2021 Financial Performance vs. Q4 2020 Financial Information ($M, excl. EPS) Orders Revenue Adj. EBITDA & Margin¹ Adj. Diluted EPS² Up 24%; Up 25% ex-FX Up 16%; Up 18% ex-FX Adj. EBITDA Up 15% Up $0.23; Up 51% Change in Adj. EBITDA Margin ITS (40) bps PST (400) bps Total IR (20) bps • PST Adj. EB
Slide 10: FY 2021 Financial Performance vs. FY 2020
FY 2021 Financial Performance vs. FY 2020 Supplemental Financial Information1 ($M, excl. EPS) Orders Revenue Adj. EBITDA & Margin² Adj. Diluted EPS3 Up 31%; Up 28% ex-FX Up 19%; Up 16% ex-FX Adj. EBITDA Up 28% Up $0.81; Up 63% Change in Adj. EBITDA Margin ITS 220 bps PST (50) bps Total IR 160 bps •
Slide 11: Q4 2021 Financial Performance
Q4 2021 Financial Performance ($M, excl. Leverage) Free Cash Flow1 Leverage2 Cash Flows from Operations less Capex (Net Debt / LTM Adjusted EBITDA) Liquidity & Leverage $248¹,³ Total available liquidity of $44 $225¹,³ $3.2B including: 2.6x (3)4 ($23) $44 ($3)4 ‒ Cash and Cash Equivalents: $2.1B 2.
Slide 12: Strong Execution on Synergy Delivery and Price / Cost
Strong Execution on Synergy Delivery1 and Price / Cost Synergy Delivery Update Price / Cost (Direct Material + Logistics) Commentary Commentary $350M+ Synergy Funnel Changes since Q2 2021 update: 2021 Remained price / cost positive each quarter in 2021 ~$300M2 Reduced costs to achieve synergie
Slide 13: Industrial Technologies and Services Q4 2021 Highlights
Industrial Technologies and Services Q4 2021 Highlights Q4 2021 vs. Q4 2020 ($M) Q4 2021 vs. Q4 2020 Revenue/Orders Bridge Current Year Prior Year YoY ∆ Ex-FX YoY ∆ Organic FX M&A YoY ∆ Revenue $1,129.0 $1,012.0 11.6% 12.7% Orders Growth 19.2% (1.2)% 2.5% 20.5% Adj. EBITDA $290.7 $264.4 9.9% — Reven
Slide 14: Precision and Science Technologies Q4 2021 Highlights
Precision and Science Technologies Q4 2021 Highlights Q4 2021 vs. Q4 2020 ($M) Q4 2021 vs. Q4 2020 Revenue/Orders Bridge Current Year Prior Year YoY ∆ Ex-FX YoY ∆ Organic FX M&A YoY ∆ Revenue $289.8 $206.5 40.3% 41.8% Orders Growth 14.3% (1.5)% 26.1% 38.9% Adj. EBITDA $77.6 $63.5 22.2% — Revenue Gro
Slide 15: 2022 Guidance
2022 Guidance Guidance Estimates for Full Year Ingersoll Rand Commentary • ~35% incremental margin expected in 2022 Revenue Adjusted Phasing Growth1 EBITDA² Revenue Growth • Positive margin expansion expected sequentially from Q1 2022 – Q4 2022 H1: 12-14% Total 11-13% $1,375M - $1,415M • Adj. EBITDA
Slide 16: Key Takeaways – Investing with Ingersoll Rand
Key Takeaways – Investing with Ingersoll Rand 1 Strong performance in Q4 with momentum into Q1; 2022 is poised to be a strong year 2 Continuing to differentiate Ingersoll Rand as an investment: • Investing for growth • Increasing the quality of the portfolio • Becoming more sustainable 3 IRX is our
Slide 17: Appendix
am Ingersoll Rand Appendix
Slide 18: Reconciliation of Net Income (Loss) to Adjusted Net Income
Reconciliation of Net Income (Loss) to Adjusted Net Income (Unaudited; in millions) For the Three Month Period For the Twelve Month Ended December 31, Period Ended December 31, 2021 2020 2021 2020 Net Income (Loss) $ 293.7 $ 151.1 $ 565.0 $ (32.4) Less: Income from Discontinued Operations 47.9 15.4
Slide 19: Reconciliation of Diluted Net Income (Loss) Per Share to Adjusted Diluted Net Income Per Share
Reconciliation of Diluted Net Income (Loss) Per Share to Adjusted Diluted Net Income Per Share from Continuing Operations (Unaudited; in millions, except per share amounts) For the Three Month Period For the Twelve Month Period Ended December 31, Ended December 31, 2021 2020 2021 2020 Diluted Net In
Slide 20: Reconciliation of Net Income (Loss) to Adjusted Earnings per Share
Reconciliation of Net Income (Loss) to Adjusted Earnings per Share (Unaudited; in millions, except per share amounts) For the Three Month Period For the Twelve Month Period Ended December 31, Ended December 31, 2021 2020 2021 2020 Net Income (Loss) $ 293.7 $ 151.1 $ 565.0 $ (32.4) Less: Income (Loss
Slide 21: Reconciliation of Net Income to Adjusted EBITDA and Free Cash Flow
Reconciliation of Net Income (Loss) to Adjusted EBITDA and Adjusted Income from Continuing Operations, Net of Tax and Cash Flows from Operating Activities to Free Cash Flow (Unaudited; in millions) For the Three Month Period Ended December 31, For the Twelve Month Period Ended December 31, 2021 2020
Slide 22: Reconciliation of Cash Flow from Operating Activities to Adjusted FCF
Reconciliation of Cash Flow from Operating Activities to Adjusted Cash Flow from Operating Activities and Adjusted FCF (Unaudited; in millions) For the Three Month Period For the Twelve Month Ended December 31, Period Ended December 31, 2021 2020 2021 2020 Cash Flow from Operating Activities from Co
Slide 23: Reconciliation of Segment Adjusted EBITDA to Net Income (Loss)
Reconciliation of Segment Adjusted EBITDA to Net Income (Loss) (Unaudited; in millions) For the Three Month Period For the Twelve Month Period Ended December 31, Ended December 31, 2021 2020 2021 2020 Segment Adjusted EBITDA Industrial Technologies and Services $ 290.7 $ 264.4 $ 1,033.7 $ 759.8 Prec
Slide 24: Combined Financial Information by Segment
Combined Financial Information by Segment For the Three Months For the Twelve Months Ended December 31, 2021 Ended December 31, 2021 Ingersoll Rand Orders $ 1,507.0 $ 5,764.5 Revenue 1,418.8 5,152.4 Adjusted EBITDA (non-GAAP) 342.1 1,191.9 Adjusted EBITDA Margin (non-GAAP) 24.1% 23.1% Adjusted Net I
Slide 25: Orders and Revenue Growth by Segment
Orders and Revenue Growth by Segment1 (Unaudited) For the Three Month Period Ended December 31, 2021 Orders Revenue Ingersoll Rand Organic growth 18.3% 11.3% Impact of foreign currency (1.2%) (1.2%) Impact of acquisitions 6.7% 6.3% Total adjusted orders and revenue growth 23.8% 16.4% Industrial Tech
Slide 26: Unaudited Supplemental Adjusted Combined Financial Information
Unaudited Supplemental Adjusted Combined Financial Information Ingersoll Rand is providing the below unaudited supplemental historical financial information of the Company on a non-GAAP adjusted basis for the fiscal year ended December 31, 2020 as if the Transaction was completed on January 1, 2018,
Slide 27: Table 1: Supplemental Adjusted Combined Financial Information by Segment
Table 1: Unaudited Supplemental Adjusted Combined Financial Information by Segment (Unaudited; dollars in millions, per share amounts in whole dollars) For the Twelve Months Ended December 31, 2020 Ingersoll Rand Supplemental Adjusted Orders $ 4,410.5 Supplemental Adjusted Revenue (non-GAAP) 4,344.4
Slide 28: Table 2: Supplemental Adjusted Combined Revenue and Order Growth by Segment
Table 2: Unaudited Supplemental Adjusted Combined Revenue and Order Growth by Segment1 (Unaudited) For the Twelve Month Period Ended December 31, 2021 Orders Revenue Ingersoll Rand Organic growth 23.6% 12.3% Impact of foreign currency 3.0% 2.6% Impact of acquisitions 4.1% 3.7% Total orders and reven
Slide 29: Table 3: Reconciliation of GAAP Revenue to Supplemental Adjusted Revenue
Table 3: Reconciliation of GAAP Revenue to Supplemental Adjusted Revenue by Segment and for the Company and Segment Adjusted EBITDA to Supplemental Segment Adjusted EBITDA (Unaudited; in millions) For the Twelve Month Period Ended December 31, 2020 Supplemental GAAP Revenue Adjustments (1) Adjusted
Slide 30: Table 4: Reconciliation of GAAP Net Loss to Adjusted EBITDA
Table 4: Reconciliation of GAAP Net Loss to Adjusted EBITDA and Supplemental Adjusted EBITDA and Supplemental Further Adjusted Net Income (Unaudited; in millions) Twelve Months Ended December 31, 2020 Net Loss (GAAP) $ (32.4) Less: Income from discontinued operations 26.0 Less: Income tax benefit (p
Slide 31: Table 5: Reconciliation of GAAP Diluted EPS to Supplemental Further Adjusted Diluted EPS
Table 5: Reconciliation of GAAP Diluted EPS to Supplemental Further Adjusted Diluted EPS (Shares in millions, per share amounts in whole dollars) For the Year Ended December 31, 2020 Diluted Loss Per Share (GAAP) $ (0.09) Diluted Earnings Per Share from Discontinued Operations (GAAP) 0.06 Diluted Lo