Nvent Electric Plc · NYSE:NVT
Nvent Electric — Q2 2023 Earnings Presentation
20 slides from Nvent Electric's earnings presentation, Jul 28, 2023
Slide 1: nVent Second Quarter 2023 Earnings Presentation
nVent Second Quarter 2023 Earnings Presentation July 28, 2023 1
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: Key Messages
Key Messages Record Q2 sales of $803M, up 10%; adjusted EPS of $0.77, up 35% Another quarter of impressive ROS expansion and robust free cash flow Completed acquisition of ECM Industries Significant progress on our ESG goals; recently published 2022 report Raising full-year reported sales and adjust
Slide 4: Q2 2023 Summary
Q2 2023 Summary ▪ Sales of $803 million, up 10% and 4% organically ▪ Segment income of $181 million, up 45%; ROS of 22.6%, up 540 bps Q2 2023 ▪ Adjusted EPS of $0.77, up 35% ▪ Free cash flow of $62 million, up 29% ▪ Organic sales growth across all verticals, led by Infrastructure Q2 ▪ Data solutions
Slide 5: Q2 2023 nVent Performance
Q2 2023 nVent Performance Sales ($M) Financial Highlights (YoY) $40 $50 $803 $728 ▪ Sales up 10%, organically up 4% $(2) $(12) - Price added 5 points to growth - Acquisition added 7 points to growth +10% YoY ▪ Segment income up 45% (2) pts 5 pts 7 pts 0 pts - Year-over-year ROS expansion of 540 bps
Slide 6: Q2 2023 Segment Performance
Q2 2023 Segment Performance ($M) Sales Segment Income Commentary Organic sales growth, led by Infrastructure and Industrial Enclosures $400 $90 Robust sales growth in North America Up 5% Up 46% Up 5% organic ROS 22.5% (+630bps) Price and volume contributed to sales growth ROS expansion from
Slide 7: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow Cash Flow ($M) Debt Summary ($M) $1,981 Maturity Q2 YTD 2023 2023 $500 @ 2028 $1,300 66% Fixed $300 @ 2031 Net Income $ 113 $ 207 Amortization 21 39 $500 @ 2033 Subtotal $ 134 $ 246 $681 34% Variable 2026-2028 Depreciation 12 23 Q2 ’23 Weighted Average Rate ~5% Capital Ex
Slide 8: Capital Allocation Update
Capital Allocation Update Manage Reinvest in Return Cash M&A Leverage the Business to Shareholders ▪ Net debt to adjusted ▪ Full-year capex of ▪ Target ROIC > WACC ▪ Returned ~$73 million EBITDA ratio at 2.8X $70 to $75 million in 2 to 3 years in cash to shareholders ▪ Target of 2.0X to 2.5X ▪ Incre
Slide 9: 2023 nVent Outlook
2023 nVent Outlook Total nVent Expected Drivers ▪ Secular tailwinds continue in electrification Guidance as of 04/28/23 Updated Guidance ▪ Price realization offsetting inflation Up 4% to 6% Up 13% to 15% Sales Up 4% to 6% organic Up 4% to 6% organic ▪ Supply chain improvements ▪ Increased investment
Slide 10: Q3 2023 nVent Outlook
Q3 2023 nVent Outlook Q3 ‘23 Q3 ‘22 Other Items Reported sales Up 16% to 18% $745M Tax rate ~19.5% Organic sales Up 1% to 3% 20% Net interest expense ~$27M EPS (reported) $0.54 to $0.56 $0.55 Shares ~168M EPS (adjusted) $0.72 to $0.74 $0.66 Expected Drivers ▪ Continued price realization offsetting i
Slide 11: Data Solutions
Data Solutions Drivers Positioned to Win Liquid Cooling ▪ Artificial Intelligence ▪ Leading with technical expertise, ▪ AI adoption accelerating demand for innovative designs and manufacturing liquid cooling ▪ More data consumption capabilities ▪ Up to 50% energy savings with liquid ▪ Rising heat de
Slide 12: 2022 ESG Report
2022 ESG Report PEOPLE PRODUCTS PLANET Continued to increase Developed differentiated Reduced environmental diverse representation; drove solutions with measurable impact across our employee engagement and ESG impact; driving business; installed first volunteerism customer sustainability on-site ren
Slide 13: Growing Through M&A
Growing Through M&A ECM Industries TEXA Industries Leading provider of electrical connectors, tools and test Leading provider of advanced cooling technologies with instruments and cable management. innovative industrial air conditioners and chillers. ▪ Complementary power connection and grounding so
Slide 14: Summary
Summary ▪ Record sales and adjusted EPS in Q2 ▪ Completed ECM Industries and TEXA Industries acquisitions ▪ Raising full-year reported sales and adjusted EPS guidance 1 4 Well positioned with electrification, sustainability and digitalization trends Q2 ’23 Earnings Presentation 14
Slide 15: Appendix and GAAP to Non-GAAP Measurements & Reconciliations
Appendix and GAAP to Non-GAAP Measurements & Reconciliations 15 15
Slide 16: Reported to Adjusted 2023 Reconciliation
Reported to Adjusted 2023 Reconciliation Q2 ’23 Earnings Presentation 16
Slide 17: Reported to Adjusted 2022 Reconciliation
Reported to Adjusted 2022 Reconciliation Q2 ’23 Earnings Presentation 17
Slide 18: Reported to Adjusted 2021 Reconciliation
Reported to Adjusted 2021 Reconciliation Q2 ’23 Earnings Presentation 18
Slide 19: Organic Sales Growth and Free Cash Flow Reconciliation
Organic Sales Growth and Free Cash Flow Reconciliation Q2 ’23 Earnings Presentation 19
Slide 20: 2022 Organic Sales Growth Reconciliation
2022 Organic Sales Growth Reconciliation Q2 ’23 Earnings Presentation 20