Slide 1: Q2 2025 Earnings Presentation
Q2 2025 JULY 30, 2025 EARNINGS PRESENTATION
Slide 2: Legal Disclaimers
LEGAL DISCLAIMERS 2 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This presentation contains, and management may make on our call today, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 19
Slide 3: Q2 2025 Key Highlights & Metrics
Q2 2025 KEY HIGHLIGHTS & METRICS 3 ▪ Core revenue performance consistent with guidance • Industrial and Automotive Replacement channels delivered positive core growth YoY • Personal Mobility increased double-digits; Off-Highway flat ▪ Solid operating results • Adjusted EBITDA margin in line with exp
Slide 4: Q2 2025 Financial Performance
Q2 2025 – FINANCIAL PERFORMANCE 4 $884M (0.6%) Core Sales Decline YoY ▪ ▪ Underlying demand in line with expectations Replacement channels grew Net Sales $199M 22.5% Adjusted EBITDA margin ▪ ▪ Gross margin was 40.8%; 5th consecutive quarter above 40% Continue to progress towards mid-term targets Adj
Slide 5: Q2 2025 Segment Results
Q2 2025 – SEGMENT RESULTS 5 PERFORMANCE HIGHLIGHTS POWER TRANSMISSION NET SALES $550M ▪ High single-digit growth in Industrial OEM sales, largely offset by Automotive OEM decrease 0.6% Core YoY ▪ High teens growth in Personal Mobility; strong ADJUSTED EBITDA $123M conversion of design wins ▪ Replace
Slide 6: Q2 2025 Regional Core Revenue Performance
Q2 2025 – REGIONAL CORE REVENUE PERFORMANCE 6 Total Gates Greater China 10% (0.6%) 10% EA&I North 48% America REVENUE 27% EMEA 5% (1.3%) (1.3%) +0.6% South North EMEA America Greater America China • NA: Growth in Auto Replacement, Personal Mobility, and Diversified Industrial offset by weaker On- (2
Slide 7: Q2 2025 Adjusted EPS Walk
Q2 2025 ADJUSTED EPS WALK 7 $0.04 $0.01 $0.39 $0.01 ($0.02) $0.36 ($0.01) Q2 2024 Adj. EPS Operating Performance Non-Recurring Favorable F/X Interest Expense Share Count Q2 2025 Adj. EPS Benefit in Q2 20241 YOY GROWTH SUPPORTED BY SOLID UNDERLYING OPERATING EXECUTION AND PRUDENT CAPITAL ALLOCATION 1
Slide 8: Q2 2025 Capital Efficiency & Cash Flow
Q2 2025 – CAPITAL EFFICIENCY & CASH FLOW 8 ▪ Improved 11% YoY; 73% free cash flow $74M Free Cash Flow Solid Free Cash Flow generation ▪ conversion for quarter LTM free cash flow conversion increased to 80% 2.2x Net Leverage Improved YoY and sequentially ▪ ▪ Cash balance exceeded $700 million Expect
Slide 9: Increasing 2025 Guidance
INCREASING 2025 GUIDANCE 9 PRIOR 2025 CURRENT 2025 B/W (Midpoint) CORE REVENUE GROWTH (0.5%) to +3.5% 0.5% to 2.5% No Change ADJUSTED EBITDA $735M – $795M $765M – $795M +$15M ADJUSTED EPS $1.36 – $1.52 $1.44 – $1.52 +$0.04 CAPITAL EXPENDITURES ~$120M ~$120M No Change FREE CASH FLOW CONVERSION 90%+ 9
Slide 10: Data Centers – Expanding Portfolio and Pipeline
DATA CENTERS – EXPANDING PORTFOLIO AND PIPELINE 10 FULL SOLUTIONS PORTFOLIO Hyperscalers (Data Center Operators) Notable Wins/Opportunities Data Master Hose assembly with major hyperscaler under negotiation for 2026 supply DATA MASTER DATA MASTER UNIVERSAL QUICK Server Manufacturers Notable Wins/Opp
Slide 11: Personal Mobility – Penetration Story Unfolding
PERSONAL MOBILITY – PENETRATION STORY UNFOLDING 11 INVESTING IN CAPABILITIES INNOVATION DRIVES ADOPTION ATTAINING GROWTH Incremental R&D investment and Innovation driving market Pipeline of business scaling up commercial access to a new range of opportunities exceeds capabilities globally applicatio
Slide 12: Summary Thoughts
SUMMARY THOUGHTS 12 ▪ Managing business well despite uncertainty • Positioning to drive accelerated core revenue growth over the mid-term • Highly focused on driving further gross margin improvement ▪ We have multiple secular growth opportunities available over the near- and medium-term • Significan
Slide 13: © 2025 Gates Corporation. All rights reserved.
13 © 2025 Gates Corporation. All rights reserved.
Slide 14: Appendix
APPENDIX © 2025 Gates Corporation. All rights reserved.
Slide 15: Q2 2025 Adjusted EPS – Summary Walk
Q2 2025 ADJUSTED EPS – SUMMARY WALK 15 Q2 2024 $0.36 OPERATING PERFORMANCE 0.04 Performance supported by gross margin expansion F/X (0.01) Transactional headwinds compared to prior year period NET INTEREST EXPENSE 0.01 Lower interest rate LOWER SHARE COUNT 0.01 Share repurchases executed over the la
Slide 16: Reconciliations – Core Sales Growth
RECONCILIATIONS – CORE SALES GROWTH 16 (USD in millions) Power Transmission Fluid Power Q2 2025 Reconciliation of Core Sales Growth Net sales for the quarter ended June 28, 2025 $ 550.1 $ 333.6 $ 883.7 Impact on net sales of movements in currency rates (5.2) 1.5 (3.7) Core sales for the quarter ende
Slide 17: Reconciliations – Adjusted EBITDA & Net Leverage
RECONCILIATIONS – ADJUSTED EBITDA & NET LEVERAGE 17 (USD in millions) Q2 2025 Q2 2024 YTD 2025 YTD 2024 LTM Q2 2025 LTM Q2 2024 (1) Other expenses (income) excludes foreign currency transaction losses of Reconciliation to Adjusted EBITDA $1.0 million, $2.1 million $1.9 million Net Income from Contin
Slide 18: Reconciliations – Segment Adjusted EBITDA
RECONCILIATIONS – SEGMENT ADJUSTED EBITDA 18 (USD in millions) Change Change Q2 2025 Q2 2024 YTD 2025 YTD 2024 Reconciliation to Segment Adjusted EBITDA Margin Power Transmission Net Sales $ 550.1 $ 541.9 $ 8.2 $ 1,077.3 $ 1,074.7 $ 2.6 Power Transmission Adjusted EBITDA $ 122.8 $ 123.8 $ (1.0) $ 23
Slide 19: Reconciliations – Adjusted Net Income
RECONCILIATIONS – ADJUSTED NET INCOME 19 (USD in millions, except share numbers and per share amounts) Q2 2025 Q2 2024 YTD 2025 YTD 2024 LTM Q2 2025 LTM Q2 2024 Reconciliation to Adjusted Net Income Net Income Attributable to Shareholders $ 56.5 $ 70.7 $ 118.5 $ 110.7 $ 202.7 $ 252.3 Adjusted for: L
Slide 20: Reconciliations – Adjusted Net Income (Cont.)
RECONCILIATIONS – ADJUSTED NET INCOME (CONT.) 20 (1) In July 2022, Gates suspended our operations in Russia. During the three months ended September 28, 2024, we deconsolidated the Russian subsidiary upon loss of control and recognized a deconsolidation loss. (2) Inventory write-offs and adjustments
Slide 21: Reconciliations – Free Cash Flow & Free Cash Flow Conversion
RECONCILIATIONS – FREE CASH FLOW & FREE CASH FLOW 21 CONVERSION (USD in millions) Q2 2025 Q2 2024 YTD 2025 YTD 2024 LTM Q2 2025 LTM Q2 2024 Reconciliation of Free Cash Flow Net Cash Provided By Operating Activities $ 103.0 $ 93.8 $ 110.3 $ 72.8 $ 417.1 $ 369.9 Capital Expenditures (1) (29.4) (27.2)
Slide 22: Reconciliations – Return on Invested Capital (ROIC)
RECONCILIATIONS – RETURN ON INVESTED CAPITAL (ROIC) 22 (USD in millions) LTM Q2 2025 LTM Q2 2024 Return On Invested Capital (ROIC) LTM Adjusted EBITDA $ 749.8 $ 773.0 LTM Total depreciation and amortization (213.3) (218.1) LTM Amortization of intangible assets arising from the 2014 acquisition of Ga