Slide 1: Badger Meter Second Quarter 2019 Earnings
BADGER METER SECOND QUARTER 2019 EARNINGS July 18, 2019 © 2019 Badger Meter, Inc. 1
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Certain statements contained in this presentation as well as other information provided from time to time by the Company or its employees, may contain forward looking statements that involve risks and uncertainties that could cause actual results to differ materially from
Slide 3: Second Quarter Highlights
SECOND QUARTER HIGHLIGHTS Adj. EBITDA Margin % Q2 YTD 20.4% 20.0% • Gross profit and EBITDA margin 19.5% 17.8% improvement year-over-year with favorable product and SaaS mix, as well as positive price/cost • Strong cash flow and working capital management Adj. EPS • Lower year-over-year sales with Q
Slide 4: Second Quarter Financial Snapshot
SECOND QUARTER FINANCIAL SNAPSHOT (US$ in millions, except per share data) Q2 2019 Q2 2018* Change • Municipal water sales down 9.6% Sales $103.5 $113.6 -8.9% year-over-year – new product order deferrals due to innovation pause Gross Margin 40.3 41.5 -3.0% more than offset favorable mix to 38.9% 36.
Slide 5: Customer Centric - Innovation and Quality
CUSTOMER CENTRIC - INNOVATION AND QUALITY ORION Cellular End Points • Technology innovations with significant feature and benefit enhancements can result in deferred order patterns o LTE-M radio endpoints; path to 5G • Infrastructure free, multiple daily read intervals, two way communication E-Serie
Slide 6: Progress on Strategic Initiatives
PROGRESS ON STRATEGIC INITIATIVES • Quote activity, opportunity funnel and backlog to support our Prototype: E-Series with Integrated Flow growth plans Limiting Valve • Positive backdrop with municipal spending trends and our competitive share and positioning • Organization structure changes to bett
Slide 7: Q&A
Q&A Note: For your planning purposes, our Q3 2019 earnings release/call is tentatively scheduled for October 17, 2019 © 2019 Badger Meter, Inc. 7
Slide 8: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS EBITDA Free Cash Flow (US$ in millions) (US$ in millions) Q2 2019 Q2 2018 YTD 2019 YTD 2018 Q2 2019 Q2 2018 Net Earnings (GAAP) $11.4 $6.2 $22.2 $13.7 Cash from Ops (GAAP) $23.1 $18.4 Pension settlement charge, net 0.0 6.1 0.0 6.1 Capital Expenditures (2.3) (2.2) Int
Slide 9: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS (US$ in millions except per share data) Q2 2018 YTD 2018 GAAP Adjustments Adjusted GAAP Adjustments Adjusted Sales $113.6 $113.6 $218.7 $218.7 Gross Margin 41.5 41.5 78.2 78.2 SEA 25.2 25.2 51.9 51.9 Operating Income 16.3 16.3 26.3 26.3 Pension Settlement Charge (8.2