Acuity Inc. · NYSE:AYI
Acuity — Acuity Brands — Robert W. Baird Industrial Conference 2010
30 slides from Acuity's conference presentation, Nov 9, 2010
Slide 1: Robert W. Baird Industrial Conference
Robert W. Baird Industrial Conference November 10, 2010 Vernon J. Nagel Chairman, President & CEO
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation contains forward?looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. Statements made herein that may be considered forward?looking include statements incorporating terms such as “expects,” “believes,” “intends,”
Slide 3: Profile
Profile Positioned for Success A Bright Future
Slide 4: Vision & Strategy
Vision & Strategy Vision:Market leader by delivering superior lighting solutions Strategy:Drive profitable growth by aligning the considerable and unique capabilities and resources of our organization with a keen focus on: Customers — Differentiated Lighting Solutions Cost — World?Class Efficiency C
Slide 5: Company Overview
Company Overview N.A. Market Share Leader Most recognized brands in the lighting industry Mfg Facilities: 17 Sales Channels: 14 Customers: 5,000 Products: 500,000 Active Products 2,000 Product Groups Associates: 6,000
Slide 6: Industry Leading Indoor & Outdoor Product Portfolio
Industry Leading Indoor & Outdoor Product Portfolio North AmericaAcuityProduct TypesMarket SizeBrands$9.3 BillionRanking*USDCommercial Indoor$3.2Outdoor$2.3Residential$1.5 Outdoor Industrial$1.0Lighting Controls$0.9Emergency$0.4 AB Ranking 1 2 — 4 4 * Market Share
Slide 7: Financial Summary
Financial Summary ($Millions, except Diluted EPS) Operating Profit & Margins Diluted EPS $261 $3.51 $222 12.9% +21% $2.89 Margin 11.3% +67% Margin $152 $154 $158 $2.01 9.3% 9.7% $1.73 $1.79 8.3% -43% Margin Margin Margin +215% - -11% $67 4.1% 5-Yr CAGR $0.55 5-Yr CAGR Margin 13% 27% Net Sales $1 965
Slide 8: Financial Summary: Free Cash Flow and Leverage
Financial Summary ($Millions) Free Cash FlowLeverage(Net Debt?to?Capital Ratio)$196$17734%34%$13924%$104$10118%19%$7110% ‘05’06 ‘07 ‘08 ‘09 ‘10’05 ‘06 ‘07 ‘08 ‘09 ‘10 Note: Free Cash Flow is defined as cash flow from operations minus capital expenditures. Net Debt?to?Capital Ratio is defined as tota
Slide 9: Positioned for Success
Profile Positioned for Success A Bright Future
Slide 10: Positioned for Success
Positioned for Success Operations Market Access Portfolio Growth Leverage Addressable Market
Slide 11: Positioned for Success - Internal Leverage
Positioned for Success - Internal Leverage Lean Business Processes Operating Metrics 2004 — 2010Financial Metrics 2004 — 2010Sales per Associate38%Gross Profit Margin20%Mfg Footprint (Sq Ft)42%Operating Margin52%Op. Working Capital42%Free Cash Flow143%(% of Net Sales) Note: Free cash flow is defined
Slide 12: Positioned for Success - Market Access
Positioned for Success - Market Access Channel Leadership Product SegmentsSales Channel CommercialIndustrialRenovationResi.ControlsC & IDirectHome CenterShowroomUtilitiesNat’l Accts
Slide 13: Positioned for Success - Portfolio
Positioned for Success Portfolio LuminairesControls AcquisitionsAcquisitions Mark LightingLC&DRenaissanceSensor SwitchWinona2009 — 100+ New ProductsNew Products 2010 — 100+
Slide 14: Portfolio Growth Through Innovation & Acquisitions
Positioned for Success - Portfolio Growth Through Innovation & Acquisitions Indoor FunctionalArchitectural #1 Market Position #1 Market Position Controls #3 #1 FunctionalArchitectural#1 Market Position #2 Market Position Outdoor
Slide 15: Positioned for Success - Addressable Market
Positioned for Success - Addressable Market Significant Expansion of Addressable N.A. Market Prior2010 Controls Growth Renovation NewNewConstruction/Construction/TITI TI = Tenant Improvements Source: Company Estimates
Slide 16: A Bright Future
Profile Positioned for Success A Bright Future
Slide 17: Market / Macro Trends
A Bright Future Market / Macro Trends Innovation & Markets Strategic Focus
Slide 18: North American Market 2010 - $9.3 Billion
A Bright Future - North American Market 2010 ? $9.3 Billion Product Segments Controls(Sensors &IndustrialModules)11%9% Outdoor 19% Comm. & Inst. 35% Residential 16% Other 10% Channels ESCOOtherDirect/Nat’l1%7%Accts5% Utilities 7% Lighting Showrooms 4% Home Centers 9% Electrical Wholesalers 67% Sourc
Slide 19: Macro Trends: Addressable N.A. Market/Drivers
A Bright Future ? Macro Trends Addressable N.A. Market/Drivers $15.6B+68%$2.2BControls$11.0B$1.4BLighting Solutions$1.0BRenovation (Incremental)$9.3B-15%$0.9B$11.0BNew Construction$8.4BTI/Renovation 200820102015 Drivers Superior Task Lighting Lighting Systems Lighting Value/Sq. Ft. Energy Efficiency
Slide 20: Macro Trends: N.A. Lighting Fixtures Market
A Bright Future ? Macro Trends New/TIRenovationN.A. Lighting Fixtures MarketGrowth Rates & Value($B)10%8%9%$12Installed$10Base8%7%$100B+$86%Renovation$6Conversion4%3%Opportunity$42%1%$20%$-New ConstructionFY’11FY’12FY’13FY’14FY’151.5% to 2.5% Conversion Rate Controls$2.5$2.0Billions$1.5$$1.020% CAGR
Slide 21: Innovation: LED Technology Transformation
A Bright Future Innovation Efficacy (Lm /Watt) System Technology Transformation LED 150+$0.05 120 T75oda$0.005y Conversion of earlyExpansion on LED MarketMarket ConversionLED Adaptors (cents/lm)EngineLumenLightperCost Source: Company Estimates
Slide 22: Innovation: LED and Digital Lighting
A Bright Future Innovation 50%+ LED LED &DigitalLighting Other Systems20% All about the Source 1% Phase I Source LEDOtherOther $8 B LED $4 B MainstreamLighting in aIndoor & OutdoorDigital AgeSolutions Phase IIPhase IIILighting SolutionsDigital Transformation Source: Company Estimates
Slide 23: Lighting Solutions
A Bright Future - Lighting Solutions Orders ofinteractions Intelligent distributedcontrol and productsolutionsControlsEmbedded ControlsFixturesControlsIndependent lightingcontrols & fixturesFixtures LC&DSSIABL 1st Half2nd Half2010CY’09CY’09 Integrated Lighting Solutions Total solution provider provi
Slide 24: A Leader in the Evolution of Digital Lighting
A Bright Future - Markets A Leader in the Evolution of Digital Lighting Luminaires Education Office Control Devices Integrated Lighting Solutions Healthcare Industrial Commercial
Slide 25: Indoor Lighting Solutions
A Bright Future - Indoor Lighting Solutions Quality of Lighting Experience Superior EnergyFinanciallySavingsViable IntelligentLong Life andIndoor LightingReliability
Slide 26: Outdoor Lighting Solutions
A Bright Future - Outdoor Lighting Solutions ROAM Management System • Energy/Maintenance Savings • Extended Life • Safety System Features Smart Photocontrols Diagnostics Automated Maintenance Scheduling Web?based portal Network Operation Center
Slide 27: Strategic Focus - Profitable Growth Strategy
Strategic Focus ? Profitable Growth Strategy Exp and Earnings and Cash Flow Organic Growth Operating Excellence “3 C’s” Grow Market Share
Slide 28: Financial Goals
Financial Goals Margins12%EPS Growth15%+ROE20%+Cash FlowExceed net income “Consistent Upper?Quartile Performance” Meet or exceed financial goals during an entire business cycle
Slide 29: Conclusion: Investment Considerations
Conclusion Investment Considerations Market leader Strong operating/financial leverage Product and innovation leadership Favorable market trends Compelling long?term investment
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