Novanta Inc. · NASDAQ:NOVT
Novanta — Investor Presentation (September 2019)
20 slides from Novanta's investor presentation, September 2019
Slide 1: A Trusted Technology Partner to Medical and Advanced Technology Equipment Manufacturers
A Trusted Technology Partner to Medical and Advanced Technology Equipment Manufacturers September 2019 Nasdaq: NOVT
Slide 2: Safe Harbor Statement
The statements in this presentation that relate to guidance, pro forma presentations, future plans, goals, business opportunities, and future events or performance are forward-looking statements that involve risks and uncertainties, including risks associated with business and economic conditions, f
Slide 3: Company Overview: Leader in Mission Critical Technologies
COMPANY OVERVIEW Leader in Mission Critical Technologies to Medical & Advanced Industrial Markets + $635M + $125M + $4.5B annual revenue adjusted EBITDA addressable market ~55% medical, ~45% advanced +$2.21 adjusted diluted EPS with 5%–7% CAGR industrial end markets Note: Revenue, Adjusted EBITDA an
Slide 4: Novanta Operating Model
Novanta Operating Model DIFFERENTIATED OEM FOCUS ON HIGH PERFORMANCE BUSINESS MODEL CASH RETURNS GROWTH CULTURE Highly engineered “sticky” solutions Novanta Growth System: Novanta Growth System: based on proprietary technology operational excellence innovation & commercial excellence Imbedded in ~10
Slide 5: Value Creation Approach
Value Creation Approach Multiple growth and value drivers FOCUS ON HIGH EXECUTE ON VALUE- GROWTH MARKETS CREATING M&A Niche leadership in Disciplined and cash secular growth markets returns-focused Balanced across multiple end markets DRIVE CONSISTENT OPERATE “THE ORGANIC GROWTH NOVANTA WAY” Product
Slide 6: Novanta Operating Groups and Businesses
Novanta Operating Groups and Businesses Pro Forma for completed acquisitions 40% 40% 20% PHOTONICS VISION PRECISION MOTION DETECTION & ANALYSIS Position detection Galvanometer RFID, barcode scanning sensors Optical scanners and machine vision Integrated motion Scanhead solutions solutions MINIMALLY
Slide 7: Focus on High Growth Markets
Focus on High Growth Markets INDUSTRY 4.0: FACTORY OF THE FUTURE MEDICAL: VALUE BASED HEALTHCARE Factory floor and warehouse automation Personalized medicine Key Secular Growth Drivers High precision production technologies Lower costs with better outcomes Quality control & characterization Greater
Slide 8: Drive Consistent Organic Growth
Drive Consistent Organic Growth LEVERAGE GROWTH CAPABILITIES +475 engineers Product Innovation ~9% of revenue invested in R&D +420 Patents Application & engineering focused salesforce in key local markets Global Presence Opportunity for deepening presence outside the U.S. Global manufacturing & glob
Slide 9: Execute on Value-Creating M&A
Driving New technologies double-digit that drive content & reported growth sub-system growth Execute on Value-Creating IDENTIFY MARKET OPPORTUNITIES M&A with Secular Growth Drivers Businesses with Capital deployed high growth & to high ROIC high cash returns opportunities 9
Slide 10: Expanding into Intelligent Subsystems: Laser Beam Steering
Expanding into Intelligent Subsystems SOFTWARE Laser Beam Steering COMPONENTS SUB-SYSTEMS & CONTROLS INCREASE IN VALUE CHAIN Capability Applications Accelerates roadmap for industry 4.0 Expands served market by $300M Creates laser beam steering engineering powerhouse Micromachining 3D Metal Printing
Slide 11: Expanding into Intelligent Subsystems: Motion Control
Expanding into Intelligent Subsystems SOFTWARE Motion Control COMPONENTS SUB-SYSTEMS & CONTROLS INCREASE IN VALUE CHAIN Applications Capability Applications Precision Encoders Precision Motors Drives & Robotic surgery Robotics and Controls automation 11
Slide 12: Expanding into Intelligent Subsystems: Integrated Operating Room
Expanding into Intelligent Subsystems SOFTWARE Integrated Operating Room COMPONENTS SUB-SYSTEMS & CONTROLS INCREASE IN VALUE CHAIN Capability Applications High growth medical market opportunity, with estimated market size of $200M Market requires vendor neutral solutions to import/export, store and
Slide 13: Drive Cash Flow Returns
Drive Cash Flow Returns Cash Return on Investment TARGETS After-Tax Profit1/Tangible Assets (NWC2 + PP&E3) ++ 39% 40% 52% ~4% Net productivity per year 32% 30% 25% 23% 15% of sales net working capital 2012 2013 2014 2015 2016 2017 2018 2019 1 After-Tax Profit is a non-GAAP measure, which excludes de
Slide 14: Deliver Consistent Financial Results
Deliver Consistent Financial Results ADJUSTED REVENUE ADJUSTED EBITDA ADJUSTED DILUTED EPS +/-$125M +/-$2.21 +/-$635M +16% +17% CAGR CAGR +26% CAGR $225M $42M $0.45 2012 2019 2012 2019 2012 2019 Note: Adjusted Revenue, Adjusted EBITDA & Adjusted Diluted EPS are non-GAAP measures. See explanations fo
Slide 15: Strategic Direction
1 BREAKTHROUGH SCALE Double annual revenue to $750M 2 GLOBAL MARKET LEADERSHIP “Top 2” share position globally 2020 Strategic SUPERIOR PROFITABILITY Direction 3 Deliver +20% adjusted EBITDA, with diversified businesses Leader in intelligent mission critical and enabling technologies CONSISTENT GROWT
Slide 16: About Novanta
Novanta is a leading global supplier of core technology solutions that give medical and advanced industrial original equipment manufacturers (“OEMs”) a competitive advantage. We combine deep proprietary technology expertise and competencies in photonics, vision, and precision motion with a ABOUT pro
Slide 17: Appendix
APPENDIX Nasdaq: NOVT 17 Source
Slide 18: Use of Non-GAAP
The non-GAAP financial measures used in this presentation are non-GAAP Adjusted Revenue, Adjusted EBITDA, and Adjusted Diluted EPS from continuing operations. The Company believes that these non-GAAP financial measures provide useful and supplementary information to investors regarding the Company’s
Slide 19: Non-GAAP Reconciliation
Non-GAAP Reconciliation Six Months Twelve Months Ended Ended December 31, December 31, December 31, December 31, December 31, December 31, December 31, June 28, 2012 2013 2014 2015 2016 2017 2018 2019 ADJUSTED REVENUE (in thousands of dollars) Revenue (GAAP) $243,796 $316,910 $364,706 $373,598 $384,
Slide 20: Non-GAAP Reconciliation
Non-GAAP Reconciliation Twelve Months Ended Six Months Ended December 31, 2012* December 31, 2013 December 31, 2014 December 31, 2015 December 31, 2016 December 31, 2017 December 31, 2018 June 28, 2019 ADJUSTED DILUTED EARNINGS PER SHARE (in thousands of dollars or shares, except per share amounts)