EnerSys · NYSE:ENS
EnerSys — Investor Presentation (June 2023)
41 slides from EnerSys's investor presentation, June 2023
Slide 1: Investor Presentation June 2023
Investor Presentation JUNE 2023 June 2023 © 2023 EnerSys. All Rights Reserved.
Slide 2: Forward Looking Statements
Forward Looking Statements As a reminder, we will be presenting certain forward-looking statements on this call that are based on Management’s current expectations and views regarding future events and operating performance and are subject to uncertainties and changes in circumstances. Our actual re
Slide 3: Key Takeaways
Key Takeaways We are a global Industrial Technology company delivering ✓ highly differentiated Energy Solutions to Diverse End Markets Our Proprietary Technologies and Services play a critical role ✓ in the energy transition fueled by Megatrends Our Resilient Business Model positions us well to Capt
Slide 4: EnerSys at a Glance
EnerSys at a Glance F Y 2 0 2 3 K E Y S TAT I S T I C S 1 $4.1B $322M $388M $5.34 10k+ Market Cap2 Adj. Operating Earnings3 Adj. EBITDA3 Adj. Diluted EPS3 Customers G L O B AL FAC I L I T Y B AS E 4 F Y 2 0 2 3 N E T S AL E S $3.7B Business Geography Segments 6% 14% 21% 39% 47% 73% Energy Systems Am
Slide 5: Technology Driven Portfolio Transformation
Technology Driven Portfolio Transformation 2017 2023 ▪ Traditional lead acid ▪ Integrated technology Growth Opportunities battery company solutions across energy ▪ Expand capacity for storage, power & premium products electronics, and software ▪ Grow Motive Power ▪ Narrow set of end markets & servic
Slide 6: Leveraging Our Platforms Across All Segments
Leveraging Our Platforms Across All Segments 3 Core Technology Platforms 3 Business Segments 6 End Markets Communication Networks Energy Systems Data Centers Power Industrial Power, Utilities, Electronics and Renewable Energy Energy Premium Storage Logistics and Motive Power Energy (Flooded, TPPL, L
Slide 7: Technology to Meet Customer Needs
Technology to Meet Customer Needs Lithium-ion • Edge computing, efficient data collection to the cloud • Maintenance-free, longer cycle life, fastest charge rate • Asset management software Software • Innovative safety technology • App support to manage health of assets • Ideal for use cases requiri
Slide 8: Technology Advancements
Technology Advancements POWERING THE FUTURE, EVERYWHERE FOR EVERYONE TouchSafe NexSys® Li-ion 80V Battery DataSafe® XE Battery Rigorous safety testing underway Shipped first EMEA customer units Power Project of the Year Telecom customer field trials CE compliant to meet EU health, Committed to excel
Slide 9: EnerSys Lines of Business
EnerSys Lines of Business A GLOBAL LEADER IN STORED ENERGY Energy Systems Motive Power Specialty $1.7B FY’23 Revenue $1.5B FY’23 Revenue $0.5B FY’23 Revenue Energy Systems focuses on the Motive Power batteries are Specialty segment provides energy telecommunication and broadband, utilized in electri
Slide 10: Our Sustainability Journey
Our Sustainability Journey July 2021 December April 2022 2H 2020 Launched 2021 Published 2025 Established full-time inaugural Published inaugural GRI and December 2022 Target date for 2021 Sustainability Team; joined diversity supplemental SASB-aligned Published first 2H 2023 diversity and employer
Slide 11: Our Sustainability Strategy
Our Sustainability Strategy $ 4 M A N N U A L C A P I TA L A L L O C AT I O N O V E R T H E N E X T 5 Y E A R S Our Progress to Date Future Aspirations 1 ■ 2022 vs 2021: Scope 1 emissions down 7.6%*; Scope 2 down 3.7%*; Scope 3 emission ■ Targeting 25% reduction in energy intensity by 2030 (vs. 2020
Slide 12: Financial Update
Financial Update June 2023 © 2023 EnerSys. All Rights Reserved. 12
Slide 13: Q4'23 & FY'23 Highlights
Q4’23 & FY’23 Highlights ($ millions, except EPS) Q4’23 FY’23 Key Takeaways • Record net sales in the quarter and full year Net Sales $990 $3,709 (Y / Y Growth) 9.1% 10.5% • $1.3B backlog at CC2, down 7% y/y; ~2X pre-covid levels, stable demand and order trends across all segments Adj. Operating Ear
Slide 14: Healthy Backlog Drives Long-Term Growth
Healthy Backlog Drives Long-Term Growth ORDER GROWTH & MACRO CONDITIONS DRIVING STRONG BACKLOG • Energy Systems: backlog normalizing with FY’22 large program orders closing and easing supply chain constraints; backlog coverage remains above historic levels • Motive Power: backlog coverage >2x histor
Slide 15: Price/Mix - Cost Recapture Closing the Gap
Price/Mix - Cost Recapture Closing the Gap Price/Mix – Cost Recapture (q/q, $ millions) Price/Mix – Cost Recapture (y/y, $ millions) 90 $400 $320 45 $240 0 $160 $80 -45 $- -90 ($80) Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 FY'21 FY'22 FY'23 Cost Increase Price / Mix Increase Cumul
Slide 16: Adj EPS Bridge
Adj EPS1 Bridge Q4’23 SEQUENTIAL AND YEAR-OVER YEAR Price/mix outpaced costs for third consecutive quarter 1) Non-GAAP measure. Please refer to appendix for reconciliation. $M USD AA June 2023 © 2023 EnerSys. All Rights Reserved. 16
Slide 17: Disciplined & Balanced Capital Allocation
Disciplined & Balanced Capital Allocation Capital Allocation FY’18 – FY’22 FY’23 Healthy Balance Sheet (cumulative) Priorities $ millions $ millions • 2 – 3x target leverage, adjusted to lower end of range Invest in Organic • Over $340M in cash and cash equivalents 1 Growth (CapEx) ~$390 ~$90 • Effe
Slide 18: Focusing on What We Can Control
Focusing on What We Can Control 1 Pricing – continue to execute pricing increases commensurate with cost increases Operating Efficiencies – reduce waste through EOS, including plant rationalization, productivity 2 improvements & inventory reductions balanced w/strategic buffers FX and Interest Rate
Slide 19: Compelling EnerSys Investment Case
Compelling EnerSys Investment Case BUILDING BLOCKS FOR CONTINUED SUCCESS 1 Provider of highly differentiated energy solutions 2 Full suite of technologies for a diverse set of end markets 3 Strategically aligned to large and growing markets fueled by industry megatrends 4 Healthy balance sheet with
Slide 20: Save the Date: EnerSys Investor Day
SAVE THE DATE E N E R S Y S 2 0 2 3 I N V E S T O R D AY Date: June 15th Time: 8:30 AM - 12:00 PM ET Format: Hybrid event hosted in-person and via webcast with archived replays Link: https://enersys-investor-day-2023.open-exchange.net/ Request an invitation to the live event at investorrelations@ene
Slide 21: Appendix
Appendix June 2023 © 2023 EnerSys. All Rights Reserved. 21
Slide 22: Q4'23 & FY'23 Results
Q4’23 & FY’23 Results Net Sales Adj Operating Earnings1 & Margin Y/Y Change $990 +7% price $107 Includes +4% volume 3,357 3,709 $17M IRA (2%) FX, benefit $907 $920 ~($21M) $85 $322 $67 $264 $ millions $ millions 10.8% 9.2% 7.4% 9.2% 7.9% 8.7% Q4'22 Q3'23 Q4'23 FY'22 FY'23 Q4'22 Q3'23 Q4'23 FY'22 FY'
Slide 23: Inflation Reduction Act (IRA)
Inflation Reduction Act (IRA) C R E D I T S A N D E S T I M AT E D I M PA C T • Advanced manufacturing production tax credits for battery cells and battery modules produced in the U.S. IRC 45X • Cells >=100 Watt hours per Liter (Wh/L) and & 12 Watt hour (Wh) • $35/kWh credit/ cell produced; $10/kWh
Slide 24: Q4'23 Segment Financial Highlights
Q4’23 Segment Financial Highlights $ MILLIONS; % AND BPS Y/Y GROWTH Net Sales Adj. Op Earnings1 Adj. OE1 Margin Volume +8% Price +6% Energy Systems $458 FX (2%) $29.6 6.5% ---------------------------- +86% +260 bps Reported +12% Volume (0.3%) Price +8% Motive Power $384 FX (3%) $50.4 13.1% ---------
Slide 25: Recession Playbook
Recession Playbook I M PA C T & A C T I O N S T O M I T I G AT E S L O W D O W N Key Takeaways: LoB Resilience 1. Slowdown not evident yet, but being vigilant All • Extensive backlog & pent-up demand buffers impact • Supply chain normalizing provides mix benefit 2. Company has deep history of discip
Slide 26: Motive Power
Motive Power R E V E N U E H I S T O R I C A L LY T R E N D S W I T H G D P Americas MP Net Sales vs US GDP % Motive Power Strengths $140,000 vs Prior Cycles: 6% • Bolstered by movements from increased $120,000 4% automation & electrification of ICE forklifts $100,000 2% • Higher margin NexSys® main
Slide 27: Non-GAAP Reconciliations
Non-GAAP Reconciliations June 2023 © 2023 EnerSys. All Rights Reserved. 27
Slide 28: Non-GAAP Reconciliation
Non-GAAP Reconciliation A D J U S T E D O P E R AT I N G E A R N I N G S June 2023 © 2023 EnerSys. All Rights Reserved. 28
Slide 29: Non-GAAP Reconciliation
Non-GAAP Reconciliation F Y A D J U S T E D O P E R AT I N G E A R N I N G S June 2023 © 2023 EnerSys. All Rights Reserved. 29
Slide 30: Non-GAAP Reconciliation
Non-GAAP Reconciliation ADJUSTED EBITDA June 2023 © 2023 EnerSys. All Rights Reserved. 30
Slide 31: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q4 ADJUSTED DILUTED EPS June 2023 © 2023 EnerSys. All Rights Reserved. 31
Slide 32: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q4 ADJUSTED DILUTED EPS (CONTINUED) June 2023 © 2023 EnerSys. All Rights Reserved. 32
Slide 33: Non-GAAP Reconciliation
Non-GAAP Reconciliation FY ADJUSTED DILUTED EPS June 2023 © 2023 EnerSys. All Rights Reserved. 33
Slide 34: Non-GAAP Reconciliation
Non-GAAP Reconciliation FY ADJUSTED DILUTED EPS (CONTINUED) June 2023 © 2023 EnerSys. All Rights Reserved. 34
Slide 35: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q3 ADJUSTED DILUTED EPS June 2023 © 2023 EnerSys. All Rights Reserved. 35
Slide 36: Non-GAAP Reconciliation
Non-GAAP Reconciliation Q3 ADJUSTED DILUTED EPS (CONTINUED) June 2023 © 2023 EnerSys. All Rights Reserved. 36
Slide 37: Non-GAAP Reconciliation
Non-GAAP Reconciliation L E V E R A G E R AT I O June 2023 © 2023 EnerSys. All Rights Reserved. 37
Slide 38: Non-GAAP Reconciliation
Non-GAAP Reconciliation FREE CASH FLOW June 2023 © 2023 EnerSys. All Rights Reserved. 38
Slide 39: Non-GAAP Reconciliation
Non-GAAP Reconciliation P R I M A R Y O P E R AT I N G C A P I TA L June 2023 © 2023 EnerSys. All Rights Reserved. 39
Slide 40: Non-GAAP Reconciliation
Non-GAAP Reconciliation ADJUSTED GROSS PROFIT Quarter ended Year ended ($ millions) ($ millions) March 31, 2023 January 1, 2023 March 31, 2022 March 31, 2023 March 31, 2022 Net Sales $ 989.9 $ 920.2 $ 907.0 $ 3,708.5 $ 3,357.3 Gross Profit $ 246.0 $ 213.6 $ 194.6 $ 840.1 $ 750.0 Inventory adjustment
Slide 41: Thank you.
Thank you. For more information visit us at www.enersys.com EnerSys Global Headquarters EnerSys EMEA EnerSys Asia 2366 Bernville Road EH Europe GmbH 152 Beach Road Reading, PA 19605 | USA Baarerstrasse 18 Gateway East Building #11- 08 Tel. +1-610-208-1991 6300 Zug Singapore +1-800-538-3627 Switzerla