Slide 1: First Quarter Earnings Call
FIRST QUARTER EARNINGS CALL April 27, 2023
Slide 2: Safe Harbor
SAFE HARBOR Today’s presentation includes forward-looking statements that reflect management’s current expectations about the Company’s future business and financial performance. These statements are subject to certain risks and uncertainties that could cause actual results to differ from anticipate
Slide 3: Financial Results
FINANCIAL RESULTS Statement of Earnings First Quarter $ in millions except per share amounts 2023 2022 Change (1) Net earnings and diluted net earnings per Net Sales $ 529.6 $ 494.3 7% share for 2023 and 2022 have been adjusted to provide a more Gross Profit 285.1 254.5 12 % consistent basis of comp
Slide 4: Net Sales
NET SALES Components of Net Sales Change 2023 First Quarter Segment Region Contractor Industrial Process Americas EMEA Asia Pacific Consolidated Volume and Price 7% 7% 16 % 13 % 7% (1)% 10 % Acquisitions 0% 0% 2% 1% 0% 0% 0% Currency (2)% (3)% (2)% (1)% (5)% (5)% (3)% Total 5% 4% 16 % 13 % 2% (6)% 7
Slide 5: Operating Earnings
OPERATING EARNINGS First Quarter 2022 Operating Earnings, as reported ($M and % of sales) $ 128 26 % Translation effect (7) (1) Pricing and favorable mix 40 3 Volume effect on expense leverage (4) 2 2023 Operating Earnings, as reported ($M and % of sales) $ 157 30 % Operating Earnings Quarter Over Q
Slide 6: First Quarter 2023
FIRST QUARTER 2023 Net Sales • Up 7 percent from 2022, up 10 percent at consistent translation rates • Margin rate up 2.3 percentage points compared to first quarter 2022 Gross Margin > Realized pricing and favorable mix more than offset higher product cost and adverse impact of changes in currency
Slide 7: 2023 Outlook
2023 OUTLOOK Constant currency basis and excluding acquisitions completed in the prior 12 months Americas EMEA Asia Pacific Worldwide Current Q1 2023 13% Q1 2023 7% Q1 2023 (1%) Net Sales Change Q1 2023 10% Environment Contractor Net Sales Change Q1 2023 7% Segment Q1 2023 8% Q1 2023 7% Q1 2023 (8%)
Slide 8: Cash Flow and Liquidity
CASH FLOW AND LIQUIDITY Net Earnings, as Adjusted, and Cash from Operating Activities $ in millions $137 $137 $118 $124 $127 $116 $117 $115 $102 $102 $108 $100 $104 $105 $100 $100 $91 $31 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Net Earnings, as Adjusted Cash from Operating Activites Si
Slide 9: Other Discussion Items
OTHER DISCUSSION ITEMS • Capital expenditure expectations of approximately $200 million in 2023, Cap Ex including approximately $130 million in facility expansion projects • Unallocated corporate expenses in 2023 are expected to be approximately Expenses $34 - $37 million • Repurchased 115,000 share
Slide 10: Contractor Segment Results
CONTRACTOR SEGMENT RESULTS Q1 2023 Contractor Segment $ in millions First Quarter Net Sales as % of Graco 2023 2022 Change Net Sales Americas $ 184 $ 171 8% 47% EMEA 42 41 2 Asia Pacific 20 22 (14) Total $ 246 $ 234 5% Operating Earnings $ 74 $ 59 25% % of sales 30 % 25 % Components of Net Sales Cha
Slide 11: Contractor Segment Results: Operating Margins
CONTRACTOR SEGMENT RESULTS Change in % of net sales First Quarter 2022 Operating Earnings 25 % Currency translation (1) Price and favorable mix 5 Volume effect on expense leverage 1 2023 Operating Earnings 30 % Contractor Segment Net Sales and Operating Margins Contractor Segment Operating Earnings
Slide 12: Industrial Segment Results
INDUSTRIAL SEGMENT RESULTS Q1 2023 Industrial Segment $ in millions First Quarter Net Sales as % of Graco 2023 2022 Change Net Sales Americas $ 63 $ 54 17% EMEA 48 48 0 Asia Pacific 39 43 (9) Total $ 150 $ 145 4% 28% Operating Earnings $ 53 $ 53 0% % of sales 35 % 36 % Components of Net Sales Change
Slide 13: Industrial Segment Results: Operating Margins
INDUSTRIAL SEGMENT RESULTS Change in % of net sales First Quarter 2022 Operating Earnings 36 % Currency Translation (1) 2023 Operating Earnings 35 % Industrial Segment Net Sales and Operating Margins Industrial Segment Operating Earnings QTD $250 M 40% ($3M) $5M ($2M) 35% Operating Margins $200 M 30
Slide 14: Process Segment Results
PROCESS SEGMENT RESULTS Q1 2023 Process Segment $ in millions First Quarter Net Sales as % of Graco 2023 2022 Change Net Sales Americas $ 85 $ 68 24% 25% EMEA 19 17 9 Asia Pacific 30 30 3 Total $ 134 $ 115 16% Operating Earnings $ 41 $ 27 48 % % of sales 30 % 24 % Components of Net Sales Change Q1 Q
Slide 15: Process Segment Results: Operating Margins
PROCESS SEGMENT RESULTS Change in % of net sales First Quarter 2022 Operating Earnings 24 % Currency translation (1) Price and cost 4 Volume effect on expense leverage 3 2023 Operating Earnings 30 % Process Segment Net Sales and Operating Margins Process Segment Operating Earnings QTD $200 M 35% $15
Slide 16: Adjusted Financial Results
ADJUSTED FINANCIAL RESULTS Financial results have been adjusted for comparability. Excess tax benefit from stock option exercises has caused fluctuation in the Company’s financial results. Excluding the impact of this benefit presents a more consistent basis for comparison of financial results. A ca
Slide 17: Worldwide Leader in Fluid Handling
WORLDWIDE LEADER IN FLUID HANDLING MOVE • MEASURE • MIX • CONTROL • DISPENSE • SPRAY