Enerpac Tool Group Corp. · NYSE:EPAC
Enerpac Tool — CJS Securities NDR, January 2022
29 slides from Enerpac Tool's conference presentation, Jan 18, 2022
Slide 1: CJS Securities NDR, January 2022
CJS Securities NDR, January 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements in this presentation that are not historical are considered “forward-looking statements” and are subject to change based on various factors and uncertainties that may cause actual results to differ significantly from expectations. Those factors are contained in
Slide 3: Great Products, Services, Brands, and Team
Great Products, Services, Brands, and Team Global leader in high 110 Menomonee Falls, WI ~2,100 100+ 100+ precision tools, controlled YEARS OF HEADQUARTERS EMPLOYEES MANAGEMENT TEAM # OF COUNTRIES force products, and solutions for precise heavy HISTORY YEARS EXPERIENCE PRODUCTS SOLD INTO lifting Pro
Slide 4: Wide Array of Durable and Reliable Products
Wide Array of Durable and Reliable Products Heavy Lift Bolting Cylinders Presses Pumps Work Holding Pullers Spreaders Cutters 4
Slide 5: Global Breadth of Business
Global Breadth of Business Enerpac Tools and Services benefit from having a diverse geographic customer base 36% Geographic diversification of sales United States Australia reduces overall 5% exposure to regional Mexico/Canada economic downturns 5% Sales of Opportunities for South America 3% $529m i
Slide 6: Extensive Global Distribution
Extensive Global Distribution Global distribution network is a competitive advantage • Most robust distribution 1,500+ 3,500+ 100+ network in the competitive space distributors points of sale countries • Application experts with hands-on product demonstrations • Local access to world- class tools qu
Slide 7: Digital Marketing Strategy
Digital Marketing Strategy ▪ Digital marketing channels are utilized to drive awareness, demand and sales for Enerpac products ▪ Leveraging digital channels to generate awareness ensures Enerpac is easily found and is top-of- mind among industrial professionals ▪ Easy to use digital assets simplify
Slide 8: Growth Opportunities in Broad Vertical Markets
Growth Opportunities in Broad Vertical Markets 13 VERTICAL END MARKETS Large, fragmented vertical Power Gen/ Civil Construction Wind markets provide growth opportunities, both organic Oil & Gas Off-Highway and inorganic Vehicle Repair Industrial MRO On-Highway Vehicle Repair Manufacturing and Machin
Slide 9: Select Vertical Market Opportunities: Infrastructure
Select Vertical Market Opportunities Infrastructure – Where We Participate ▪ Roads and Bridges ▪ Rail ▪ Commercial Construction ▪ Electrical Distribution ▪ Water ▪ Airports ▪ Port Facilities Premium Product Offering ▪ Known for precision, durability, and safety ▪ Strong brand recognition within lift
Slide 10: Select Vertical Market Opportunities: Power Generation / Wind
Select Vertical Market Opportunities Power Generation / Wind – Where We Participate ▪ Manufacturing ▪ Transport ▪ Installation ▪ Maintenance ▪ Decommissioning Premium Product Offering ▪ Known for precision, durability, and safety ▪ Strong brand recognition within lifting, positioning and torque and
Slide 11: Driving Organic Growth: New Product Development
Driving Organic Growth: New Product Development NEW PRODUCT DEVELOPMENT KEY OBJECTIVES OF ENERPAC NPD ▪ Focusing on innovation through Centers ▪ Create value for end users by simplifying of Excellence (CoE) and Vertical Market the “job to be done,” leveraging deep teams VOC insight ▪ Bringing new pr
Slide 12: Enabling Technology
Enabling Technology Enerpac ConnectTM - Launching Soon • SmartID tags and Connect app are foundations for the future of Smart Tools, IoT data, and closer ‘connection’ with our customers • Ultimately, opportunities to drive growth in digital future • Initial foundation built, with additional features
Slide 13: Long-Term Sustainable Returns
Return on Invested Capital – Deploying Capital to Create Long-Term Sustainable Returns Goal of enhancing Enerpac’s position as a premier industrial tools and services company and its commitment to sustainable shareholder value Invest in Ourselves to Disciplined M&A within creation Drive Organic Grow
Slide 14: Selective, Disciplined M&A
Selective, Disciplined M&A Investing in strategic acquisitions through a disciplined process to capture new growth opportunities DISCIPLINED DRIVING GROWTH STRONG STRATEGY THROUGH M&A BALANCE SHEET ▪ Commitment to pure-play ▪ Goal is to become larger, ▪ Will maintain strong industrial tools and serv
Slide 15: Significant Opportunities for Value Creation
Significant Opportunities for Value Creation Strong Business Model built on well recognized brands, robust global distribution, and broad reach of end markets Pure-Play Industrial Tools Strategy to drive core growth above market and expand BEST IN margins CLASS RETURNS Disciplined Capital Deployment
Slide 16: Appendix
Appendix
Slide 17: Why Enerpac Tool Group?
Why Enerpac Tool Group? ▪ Great products, services, and team ▪ Strong market position, global breadth and depth ▪ Heavy lifting of portfolio work is done, and Enerpac is now a pure-play industrial tools and services company ▪ Many business processes improved (NPD, marketing, digital, operations) ▪ S
Slide 18: Initial Observations and Key Objectives
Initial Observations and Key Objectives Focus and Discipline ▪ Continue and accelerate our pure-play industrial tools strategy ▪ Capture organic opportunities for improvements in base business (both growth and margin) ▪ Look selectively at inorganic opportunities to complement our product and servic
Slide 19: Q1 Market Update
Q1 Market Update Overview ▪ Supply chain and logistics continued to be a challenge in the quarter ▪ Announced additional pricing actions to offset on-going inflationary pressures ▪ Returned to our typical quarterly seasonality, which is anticipated to continue throughout the fiscal year ▪ While dist
Slide 20: Q1 Regional Update
Q1 Regional Update Americas / Europe ▪ Solid year-over-year core growth in Americas ▪ Slight year-over-year core sales decline in Europe ▪ Strong service quarter in Americas related to specialty machining ▪ Key Verticals ▪ Positive trends in Infrastructure, Power Generation and Rail ▪ Infrastructure
Slide 21: Q1 Regional Update
Q1 Regional Update Middle East/North Africa/Caspian (MENAC) ▪ Modest year-over-year core growth ▪ COVID related travel restrictions, which are changing on short notice, continue to affect labor availability and movement ▪ Experienced shut-down delays in the quarter resulting in push outs into Q2 ▪ C
Slide 22: First Quarter 2022 Comparable Results
First Quarter 2022 Comparable Results (US$ in millions except EPS) $145 $131 16.6% NET SALES $119 13.4% • Core sales growth of 9% 12.2% • IT&S product sales 12% • Other product 32% • Service down low single digits • Favorable impact of FX ~$0.2M Q1 2021 Q4 2021 Q1 2022 Q1 2021 Q4 2021 Q1 2022 ADJUST
Slide 23: Q1 Net Sales Waterfall
Q1 Net Sales Waterfall* (US$ in millions) $134 $132 $0.8 $2.7 $130 $130.9 $128 $9.4 We remain encouraged $126 by the level of product volume that we saw $124 during the quarter as our end markets $122 continue to recover, despite on-going supply $120 $0.2 chain and logistical challenges $118 $119.4
Slide 24: Product Net Sales
Product Net Sales IT&S Consolidated Product Net Sales* We returned to our normal seasonal trend in Q1. We expect that Q2 will be down sequentially, followed by sequential growth in the back half of the fiscal year. 24
Slide 25: Q1 Adjusted EBITDA Waterfall
Q1 Adjusted EBITDA Waterfall* (US$ in millions) $25 $2.3 $5.4 $20 $0.9 Adjusted EBITDA $0.4 benefited from $5.6 higher product volume/mix and $17.6 lower SG&A spend, $15 partially offset by the year-over-year $14.6 decrease in service 12.3% 13.3% volume and COVID $10 related temporary cost savings p
Slide 26: Q1 Supply Chain Update & Operations
Q1 Supply Chain Update & Operations Execution ▪ Supply chain constraints, logistic challenges and material cost increases did not improve in the quarter ▪ Continue leveraging 2nd and 3rd supplier relationships to manage regional variation in supplier performance ▪ Working with national accounts and
Slide 27: Liquidity – Positioned for Success
Liquidity – Positioned for Success (US$ in millions) $27 $255 $159 1.9 $140 $127 $175 $175 $7 0.6 0.7 Q1 2021 Q4 2021 Q1 2022 $(8) Q1 2021 Q4 2021 Q1 2022 Q1 2021 Q4 2021 Q1 2022 Q1 2021 Q4 2021 Q1 2022 Free Cash Flow Cash Balance Gross Debt TTM Financial Leverage* Free Cash Flow (FCF) Leverage • Pr
Slide 28: Expectations for Fiscal 2022
Expectations for Fiscal 2022* Reiterating our Fiscal 2022 Full Year Guidance*: ▪ Sales in the range of $590 million to $610 million ▪ Projected year-over-year core growth by category We are cautious as ▪ IT&S Product ~ mid teens% we progress through fiscal 2022 but are ▪ IT&S Service ~ mid single di
Slide 29: Enerpac Tool Group
ENERPAC (7) TOOL GROUP
Enerpac Tool Group — CJS Securities NDR, January 2022 on 6ix