Crane Company · NYSE:CR
Crane — Crane Co. 2022 Investor Conference
28 slides from Crane's conference presentation, Mar 30, 2022
Slide 1: Process Flow Technologies
PROCESS FLOW TECHNOLOGIES Alex Alcala Senior Vice President, Crane Co.
Slide 2: Process Flow Technologies
PROCESS FLOW TECHNOLOGIES Results & Guidance Driving Growth Summary 2
Slide 3: Strong and Improving Growth & Margin Profile
STRONG AND IMPROVING GROWTH & MARGIN PROFILE Target Across-the-Cycle Metrics Repositioned Consistent Accelerating Outstanding business with share gains product operational 3%-5% Core ~2/3 in higher through innovation execution Growth growth markets commercial with accretive through excellence margin
Slide 4: Strong Underlying Demand and Record Backlog
STRONG UNDERLINING DEMAND AND RECORD BACKLOG Process Flow Technologies Backlog ($ millions, FX-neutral) 380 340 300 260 220 180 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Backlog up 35% from 2019; Supply chain stable, but still constraining production 4
Slide 5: Strategically Repositioning Portfolio
STRATEGICALLY REPOSITIONING PORTFOLIO Focus Growth Markets $999M Sales $1,197M Sales 10.9% Adjusted 14.8% Adjusted Operating Margin* Operating Margin* Pharma/Aseptic, 2% Pharma/Aseptic, 3% Water & Wastewater, 7% 3%-5% Water & Wastewater, 11% Core Chemical,18% CAGR Growth 5% Chemical, 28% CAGR Gen. I
Slide 6: Sustainability & Electronics
PROCESS FLOW TECHNOLOGIES Sustainability & Electronics Chemical Products supporting sustainable future and clean energy 6
Slide 7: Sustainability & Electronics
PROCESS FLOW TECHNOLOGIES Sustainability & Electronics Chemical Products supporting sustainable future and clean energy Circular Economy Wastewater Reusing wastewater to support Circular economy 7
Slide 8: Sustainability & Electronics
PROCESS FLOW TECHNOLOGIES Sustainability & Electronics Chemical Products supporting sustainable future and clean energy Circular Economy Wastewater Reusing wastewater to support Circular economy Quality of Life Pharma / Aseptic Growth in biologics, cell culture improving quality of life 8
Slide 9: Sustainability & Electronics
PROCESS FLOW TECHNOLOGIES Sustainability & Electronics Chemical Products supporting sustainable future and clean energy Circular Economy Wastewater Reusing wastewater to support Circular economy Quality of Life Pharma / Aseptic Growth in biologics, cell culture improving quality of life Energy Effic
Slide 10: Expect ~100 bps Annual Margin Improvement
EXPECT ~100 BPS ANNUAL MARGIN IMPROVEMENT Operational and ~100 BPS average commercial per year improvements Accretive new products Volume leverage (market growth, share gains) 10
Slide 11: Confidence in Path to High-Teen Margins
CONFIDENCE IN PATH TO HIGH-TEEN MARGINS Process Flow Technologies Sales ($ millions) and Adjusted Operating Margin (%)* 1,250 Sales Margins 1,200 15.5% 1,150 1,100 1,050 1,000 950 10.9% 900 850 800 2016 2017 2018 2019 2020 2021 2022G Focused on 100 BPS average annual margin improvement 11 * Excludes
Slide 12: Process Flow Technologies
PROCESS FLOW TECHNOLOGIES Results & Guidance Driving Growth Summary 12
Slide 13: Winning in Focused Markets by Accelerating Rate of Innovation
WE ARE WINNING IN OUR FOCUSED MARKETS BY ACCELERATING THE RATE OF INNOVATION… New Product Sales – Vitality* 25% Chemical 20% 20% Wastewater 15% 10% Pharma/Aseptic 4% 5% 0% Industrial 2018 2019 2020 2021 2022E 2023E 2024E 2025E Solving our customer’s toughest problems 13 * Vitality defined as the per
Slide 14: While Driving Commercial and Operational Excellence
…WHILE DRIVING COMMERCIAL AND OPERATIONAL EXCELLENCE Case Study Example CBS is Customer Centric Drives… Growth $39 $31 $31 $33 $26 $28 $29 $24 2014 2015 2016 2017 2018 2019 2020 2021 CBS Drives… Margin Expansion OP% 700+ Breakthrough Commercial 30% 28% Kaizen Events Excellence Focus 27% 22% 23% 20%
Slide 15: Winning in the Growing Chemical Segment
WINNING IN THE GROWING CHEMICAL SEGMENT… Clean Energy & Sustainable Products ▪ Chemistry supporting clean energy ▪ 28%+ global energy consumption by 2040 ▪ Fuel cell market 20% CAGR through 2025 Electronics ▪ 2022 semiconductor industry 10% growth ▪ Artificial Intelligence (AI), Internet of Things (
Slide 16: By Solving Aggressive Media Challenges
…BY SOLVING AGGRESSIVE MEDIA CHALLENGES Clean Energy & Sustainable Products Severe Service Metal Seated Ball Valve ▪ Chemistry supporting clean energy ▪ 28%+ global energy consumption by 2040 50% Longer Life ▪ Fuel cell market 20% CAGR through 2025 Next Generation Electronics Sleeved Plug Valve ▪ 20
Slide 17: Growing Above Market Rates in Wastewater
GROWING ABOVE MARKET RATES IN WASTEWATER … Aging Infrastructure ▪ Most wastewater treatment plants (WWTP) 50+ years old and close to end of designed lifespan ▪ $55 billion for the modernization of water infrastructure in BIL* Tightening Regulations ▪ Disposal costs increasing >5% annually ▪ Stricter
Slide 18: With Better Solids Handling Solutions
…WITH BETTER SOLIDS HANDLING SOLUTIONS Aging Infrastructure Chopper Pump ▪ Most wastewater treatment plants (WWTP) 50+ years old and close to end of designed lifespan ▪ $55 billion for the modernization of water Eliminates Clogging infrastructure in BIL* Air-Filled Motor with Tightening Regulations
Slide 19: Gaining Share in Industrial
GAINING SHARE IN INDUSTRIAL… Increasing Energy Efficiency ▪ Increasing focus on reducing carbon footprint ▪ Growing importance of ESG Reducing OpEx ▪ Reducing unplanned downtime which costs an estimated ~$50 billion each year ▪ Reducing installation and maintenance costs Product Reliability ▪ Increa
Slide 20: Delivering Efficiency, Maintenance and Reliability
…DELIVERING EFFICIENCY, MAINTENANCE AND RELIABILITY Smart Positioner Increasing Energy Efficiency ▪ Increasing focus on reducing carbon footprint best-in-class low air ▪ Growing importance of ESG (energy) consumption Reducing OpEx Pressure Transducer ▪ Reducing unplanned downtime which costs an esti
Slide 21: Winning in Growing Pharma / Aseptic Market
WINNING IN GROWING PHARMA / ASEPTIC MARKET… Europe $10B North Projects China America +$2B vs $20B $16B PY Projects Projects +$1B vs PY +$7B vs PY India $6B +$1B vs Asia Pacific PY $9B +$3B vs PY ▪ Growing number of rare and specialty diseases driving innovation ▪ Aging population with improving acce
Slide 22: Through Product Innovation
…THROUGH PRODUCT INNOVATION Europe Diaphragm Valve $10B North Projects China America 90% installation +$2B vs $20B $16B PY cost savings Projects Projects +$1B vs PY +$7B vs PY India $6B +$1B vs Asia Pacific PY Diaphragms $9B +$3B vs PY 3x Longer Life ▪ Growing number of rare and specialty diseases d
Slide 23: Positioned for Growth in the Hydrogen Space
POSITIONED FOR GROWTH IN THE HYDROGEN SPACE… Hydrogen Economy ▪ 5 key uses of hydrogen: Power, Transportation, HVAC, Industrial, Feedstock ▪ Declining H2 production cost will increase adoption potential ▪ 90 countries committed to Net Zero Targets; 30 Countries have released H2 roadmaps Increasing I
Slide 24: By Solving Reliability Challenges
…BY SOLVING RELIABILITY CHALLENGES Production Hydrogen Economy ▪ 5 key uses of hydrogen: Power, Transportation, HVAC, Industrial, Feedstock Conversion of H2 ▪ Declining H2 production cost will increase Distributed via gas to… adoption potential Transmission & Distribution ▪ 90 countries committed to
Slide 25: Strong Focus on Inorganic Growth Opportunities
STRONG FOCUS ON INORGANIC GROWTH OPPORTUNITIES Chemical Number of Targets in Funnel Valves in corrosive, toxic media +63% Pharma / Aseptic Components in hygienic applications, Single Use Wastewater Treatment Solids handling, sludge management Industrial Automation Level, flow, pressure sensors Cryog
Slide 26: Process Flow Technologies
PROCESS FLOW TECHNOLOGIES Results & Guidance Driving Growth Summary 26
Slide 27: Summary
SUMMARY Accelerating growth profile ▪ Repositioned portfolio ▪ New product development and commercial excellence Strong operating leverage Expect ~100 BPS average annual margin improvement Substantial opportunities for M&A
Slide 28: Slide 28