Regal Rexnord Corporation · NYSE:RRX
Regal Rexnord — Q1 2023 Earnings Presentation
28 slides from Regal Rexnord's earnings presentation, May 5, 2023
Slide 1: First Quarter 2023 Earnings
Creating a better tomorrow™… First Quarter 2023 Earnings May 5, 2023 Louis Pinkham, Chief Executive Officer Rob Rehard, Executive Vice President, Chief Financial Officer
Slide 2: Forward Looking Statements
1Q 2023 FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which reflect Regal Rexnord’s current estimates, expectations and projections about Regal Rexnord’s future results, performa
Slide 3: Non-GAAP Financial Measures
1Q 2023 NON-GAAP FINANCIAL MEASURES We prepare financial statements in accordance with accounting principles generally accepted flow as a percentage of adjusted net income attributable to Regal Rexnord Corporation (or free in the United States of America (“GAAP”). We also periodically disclose certa
Slide 4: Opening Comments & Overview; 1Q 2023 Results, 2023 Outlook; Questions & Answers
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 1Q 2023 Results, 2023 Outlook ROB REHARD, CFO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 5: Portfolio Transformation Supports More Consistent And Higher Margin Growth
1Q 2023 A NEW, NEW REGAL REXNORD Portfolio Weighted To Automation & PT Secular Exposure On Path to We Expect 2023E Revenue To Be (>60% of Sales)* Exceed 50% ~2.4X The 2020 Level * Reflects 2022 Pro Forma Sales Creating a better tomorrow™… Portfolio Transformation Supports More Consistent And Higher
Slide 6: A Highly Differentiated Offering With Growth Acceleration Opportunities
1Q 2023 KOLLMORGEN OVERVIEW Machine Control • Innovation Driving Success In High-Growth Markets • Modular Designs + Flexible Mfg. = High-Value Solutions • Precision Motion Creates “Sticky” Annuity Sales • Gross Margin Accretive To RRX Motion Control Software HMI Slice I/O Motion Control • Last 5 Yea
Slide 7: 1Q Results: Solid Operational Execution Despite End Market Headwinds
1Q 2023 1Q RESULTS • Solid Operational Execution Despite End Market Headwinds • Free Cash Flow* Of $174M o Significant Progress On Working Capital, Primarily Inventory o Net Debt/Normalized Adj. EBITDA* Of 3.96 – On Track With Expectations • Orders Down Less Than Originally Planned o Largely De-Stoc
Slide 8: Opening Comments & Overview; 1Q 2023 Results, 2023 Outlook
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 1Q 2023 Results, 2023 Outlook ROB REHARD, CFO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 9: New Segments Better Aligned To Our Long-Term Growth Strategy
1Q 2023 RE-SEGMENTATION SUMMARY Legacy RRX Segments & BU*s And Legacy Altra Segments New RRX Segments % Of Sales** MOTION CONTROL MCS AERO BU, ALTRA PTT INDUSTRIAL SOLUTIONS (MCS) ̶ MCS CONVEYING BU + SEGMENT = POWERTRAIN 37% SOLUTIONS (IPS) ALTRA A&S MCS AERO BU, THOMSON POWER AUTOMATION & SEGMENT
Slide 10: Automation & Motion Control
1Q 2023 AUTOMATION & MOTION CONTROL Sales Adjusted Net Sales* ($M) Adjusted EBITDA* ($M) • Organic Sales* Up 11.7% & EBITDA Margin • Key Drivers • Data Center (+) • Aerospace (+) • Food & Beverage (+) * Non-GAAP Financial Measurement, See Appendix For Reconciliation Strong Performance From End Marke
Slide 11: Industrial Powertrain Solutions
1Q 2023 INDUSTRIAL POWERTRAIN SOLUTIONS Sales Adjusted Net Sales* ($M) Adjusted EBITDA* ($M) • Organic Sales* Up 1.3% & EBITDA Margin • Key Drivers • Metals & Mining (+) • Energy (+) • Alt. Energy (-) $53.5 $235.2 • Ag/Forestry (-) $43.4 * Non-GAAP Financial Measurement, See Appendix For Reconciliat
Slide 12: Power Efficiency Solutions
1Q 2023 POWER EFFICIENCY SOLUTIONS Sales Adjusted Net Sales* ($M) Adjusted EBITDA* ($M) • Organic Sales* Down 15.9% & EBITDA Margin • Key Drivers • Pool Pump (-) • N.A. Resi HVAC (-) $165.5 $39.0 • General Industrial (-) $135.7 $21.3 $189.8 * Non-GAAP Financial Measurement, See Appendix For Reconcil
Slide 13: Other Financial Updates
1Q 2023 OTHER FINANCIAL UPDATES Capital Expenditures Balance Sheet at March 31, 2023 • $18.7 Million in 1Q 2023 • Total Debt of $7,284.8 Million • Net Debt* of $6,141.5 Million Effective Tax Rate (ETR) • Net Debt*/Normalized Adj. EBITDA* of 3.96** • 20.5% Adj. ETR* in 1Q 2023 Free Cash Flow* Restruc
Slide 14: 2023 Outlook – End Market Growth Assumptions
1Q 2023 2023 OUTLOOK – END MARKET GROWTH ASSUMPTIONS Market Mix Including Altra Benefits Regal Rexnord Creating a better tomorrow™… 14 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 15: 2023 Outlook Update
1Q 2023 2023 OUTLOOK UPDATE Reiterating Outlook For Legacy RRX; Adding Altra Creating a better tomorrow™… 15 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 16: 2023 2Q Segment Outlook
1Q 2023 2023 2Q SEGMENT OUTLOOK Expect Solid Segment Performance In 2Q Creating a better tomorrow™… 16 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 17: Questions & Answers
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 1Q 2023 Results, 2023 Outlook ROB REHARD, CFO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 18: Closing Remarks
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 1Q 2023 Results, 2023 Outlook ROB REHARD, CFO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 19: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 19 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 20: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 20 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 21: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 21 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 22: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 22 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 23: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 23 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 24: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 24 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 25: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 25 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 26: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 26 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 27: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 27 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 28: 1Q 2023 Appendix
1Q 2023 APPENDIX Creating a better tomorrow™… 28 ©2022 Regal Rexnord Corporation, Proprietary and Confidential