Vontier Corporation · NYSE:VNT
Vontier — Q1 2023 Earnings Presentation
28 slides from Vontier's earnings presentation, May 4, 2023
Slide 1: Q1 2023 Earnings Results
>NION TIER’ Q1 2023 Earnings Results
Slide 2: Safe Harbor and Forward-Looking Statements
Safe Harbor and Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the federal securities laws. These statements includ e, but are not limited to statements regarding Vontier Corporation’s (the “Company’s”) business and acquisition opportunities, a
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation contains references to “core sales growth,” "baseline core sales growth," "adjusted gross profit," "adjusted gross profit margin," “adjusted operating profit,” “adjusted operating profit margin,” "baseline operating profit margin," "segment operating pro
Slide 4: Non-GAAP Financial Measures (continued)
Non-GAAP Financial Measures (continued) • Adjusted net earnings refers to net earnings calculated in accordance with GAAP, but excluding on a pretax basis amortization of acquisition-related intangible assets, restructuring costs, asset impairments, transaction-and deal-related costs, gains and loss
Slide 5: Q1 2023 | Summary & Highlights
Q1 2023 | Summary & Highlights • Strong topline performance in all 3 segments ✓ Reported Sales +4%; Core sales +4%; Baseline Core sales +11% ✓ Progress on Expanding the Core strategic pillar & benefit of Q1’23 incremental improvements in supply chain • Demand environment remains constructive Baselin
Slide 6: Executing our Connected Mobility strategy
Executing our Connected Mobility strategy CEO Kaizen 2023 iNFX 3rd annual CEO Kaizen event iNFX Microservices Platform Win TN360 Product Innovation to Support Growth • Prioritized 8 Kaizen teams on accelerating our • Global C-store customer with >10k sites • First to market with comprehensive soluti
Slide 7: Q1 2023 | Summary Financial Results
Q1 2023 | Summary Financial Results Sales Adj. Operating Profit Margin Adj. Diluted Net EPS Adj. Free Cash Flow ($M) (%) ($) ($M) $748 $776 21.8% $0.70 $78 20.8% $0.68 $40 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 • Total growth: +3.8% • Adj. Gross Margin +80bps • GAAP Diluted
Slide 8: Segment Results | Mobility Technologies
Segment Results | Mobility Technologies Sales Segment Operating Profit Q1 Highlights +18.4% 19.5% Core +12.0% • Baseline core sales +17% Acq +9.0% • Strong double-digit core growth FX (2.6%) ✓ DRB up >20% driven by $246 $48 continued strength in tunnel ($M) ($M) $208 $41 systems ✓ Alternative Energy
Slide 9: Segment Results | Repair Solutions
Segment Results | Repair Solutions Sales Segment Operating Profit Q1 Highlights +10.3% 26.1% Core +10.5% • Double-digit core growth FX (0.2%) ✓ Record order & sales activity at our 2023 Expo event ✓ Continued improvements in ($M) $181 ($M) $164 $47 $47 supply chain conditions enabled higher backlog
Slide 10: Segment Results | Environmental & Fueling Solutions
Segment Results | Environmental & Fueling Solutions Sales Segment Operating Profit Q1 Highlights -4.4% 25.7% Core (2.2%) • Baseline core growth +10% FX (2.2%) • US Dispenser volumes above expectations; broad-based demand for new site builds & site refresh $328 $82 $81 $314 ($M) ($M) • Environmental
Slide 11: Balance Sheet & Cash Flow
Balance Sheet & Cash Flow Free Cash Flow ($M) Debt & Liquidity ($M) Q1 2022 Q1 2023 Q1 2022 Q4 2022 Q1 2023 Cash from Operating Activities $41 $81 Gross Debt $2,604 $2,605 $2,543 Capital Expenditures (13) (14) (Less): Cash & Cash (145) (205) (208) Equivalents Free Cash Flow $28 $67 Net Debt $2,459 $
Slide 12: GTT Divestiture
GTT Divestiture GTT Assumptions Other Notes (Q2-Q4) • GTT divested April 14, 2023 Total Sales Change ~($35M) • Sold for $107 million, representing a transaction value of ~10X 2022 Core Sales Change No Impact EBITDA • Net proceeds to be used for debt Adj. Operating Profit ~$(10M) repurchases or stock
Slide 13: Q2 & 2023 Guidance
Q2 & 2023 Guidance Old Guidance New Guidance Other Planning Assumptions 2/16/23 Q2’23 2023 2023 Full Year 2023 YoY Change YoY Change YoY Change Sales • FX: $(0-10M) Total Sales Change (MSD) (L/MSD) (L/MSD) • Net M&A: $10-20M2 Core Sales Change* (L/MSD) (MSD)1 (L/MSD)1 Interest Expense: ~$100M Baseli
Slide 14: Supplemental
Supplemental 14
Slide 15: Segment Reporting | Historic Financial Detail (Revised)
Segment Reporting | Historic Financial Detail (Revised) 15
Slide 16: Vontier | A Compelling Investment Opportunity
Vontier | A Compelling Investment Opportunity Leading global provider of critical mobility & alternative energy technologies at the center of an attractive, rapidly evolving ~$30B Mobility Ecosystem Poised to benefit from attractive secular tailwinds Focused on maximizing shareholder value through t
Slide 17: Vontier has Unique Positions and Strengths to Win
Vontier has Unique Positions and Strengths to Win #2 in U.S. convenience retail POS #1 integrated technology provider to car wash industry in U.S. with 17k sites Top 10 global fleets IoT player (#1 ANZ, #3 UK) Leader in EV Charging smart software; ~1M+ drivers across 28 countries #1 NA player in CNG
Slide 18: Re-segmentation Aligns with Strategy and Shareholder Focus
Re-segmentation Aligns with Strategy and Shareholder Focus From: One Segment To: Three Segments* Mobility Technologies Repair Solutions Environmental & Fueling Retail Solutions VNT OpCos Point-of-Sale (POS) and payment, Premium equipment Best-in-class IoT-based fleet monitoring, and financial servic
Slide 19: Connected Mobility Strategy
Connected Mobility Strategy Operational Excellence Accelerate Growth OPTIMIZE CORE EXPAND CORE ADJACENT MARKETS Drive core growth and Leverage current Expand into near-in Operating Profit Margin positions to grow and high-growth adjacencies, Expansion (OMX) diversify portfolio diversify further VBS
Slide 20: Smart Sustainable Solutions
V I S I ON: OUR NOR T H S TA R Smart Sustainable Solutions We harness the Our innovations We connect customers – power of connected pave the way to and communities – with digital workflows and a safer and innovative mobility analytics to solve cleaner planet. technology and services high-value they
Slide 21: Appendix
Appendix 21
Slide 22: Components of Sales Growth
COMPONENTS OF SALES GROWTH 22
Slide 23: Reconciliation of Gross Profit to Adjusted Gross Profit and Margin
RECONCILIATION OF GROSS PROFIT TO ADJUSTED GROSS PROFIT AND ADJUSTED GROSS PROFIT MARGIN 23
Slide 24: Reconciliation of Operating Profit to Adjusted and Segment Operating Profit
RECONCILIATION OF OPERATING PROFIT TO ADJUSTED OPERATING PROFIT AND SEGMENT OPERATING PROFIT 24
Slide 25: Reconciliation of Net Earnings to Adjusted Net Earnings
RECONCILIATION OF NET EARNINGS TO ADJUSTED NET EARNINGS 25
Slide 26: Reconciliation of Operating Cash Flows to Free Cash Flow and Conversion
RECONCILIATION OF OPERATING CASH FLOWS TO FREE CASH FLOW AND FREE CASH FLOW CONVERSION RATIO Three Months Ended $ in millions March 31, 2023 April 1, 2022 % Change Operating Cash Flows (GAAP) $ 81.0 $ 41.3 96.1% Less: Purchases of property, plant & equipment (capital expenditures) (13.7) (12.9) Free
Slide 27: Reconciliation of Operating Cash Flows to Adjusted Free Cash Flow
RECONCILIATION OF OPERATING CASH FLOWS TO ADJUSTED FREE CASH FLOW AND ADJUSTED FREE CASH FLOW CONVERSION RATIO 27
Slide 28: Net Leverage Ratio and Reconciliation to Adjusted EBITDA
NET LEVERAGE RATIO AND RECONCILIATION FROM NET EARNINGS TO EBITDA TO ADJUSTED EBITDA 28