Slide 1: Fiscal 2021 Second Quarter Earnings
Fiscal 2021 Second Quarter Earnings March 24, 2021 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements in this presentation that are not historical are considered “forward-looking statements” and are subject to change based on various factors and uncertainties that may cause actual results to differ significantly from expectations. Those factors are contained in
Slide 3: Fiscal 2021 Second Quarter – Executing on Key Priorities
Fiscal 2021 Second Quarter – Executing on Key Priorities Employee Safety Remains #1 Concern Plants continue to operate with appropriate safety measures in place Travel to customer/project sites varies by region but consistently finding ways to promote Enerpac products Financial Highlights Did
Slide 4: Market Update
Market Update Product Net Sales Order rates continued to improve during the quarter, with IT&S product core sales declines improving sequentially to 10% in Q2 from 14% in Q1 As we proceed toward year-over-year growth, our focus shifts to reviewing our business in pressure waves rather than weekl
Slide 5: Second Quarter 2021 Summary
Second Quarter 2021 Summary Financials Sales: $121M Core sales decline of 11% (Product down 11% and Service down 12%) Adjusted EBITDA decremental margins of 29%, excluding the impact of currency (better than our target range of 35-45%) driven by mix and additional SAE costs Adjusted Diluted
Slide 6: Regional/Vertical Markets
Regional/Vertical Markets Americas / Europe Continued sequential improvement in the Americas; Europe consistent with expectations US impacted by weather in Texas Key Verticals Positive trends continue in Power Generation (Wind/Nuclear) and Construction Infrastructure in Europe is particula
Slide 7: Regional/Vertical Markets and Operations
Regional/Vertical Markets and Operations Middle East/North Africa/Caspian (MENAC) MENAC region pressured with renewed COVID-19 related border lockdowns Planned maintenance projects scheduled to begin in Q2 were pushed out Key Verticals Solid progress toward expansion beyond oil & gas Power
Slide 8: Second Quarter 2021 Comparable Results
Second Quarter 2021 Comparable Results (US$ in millions except EPS) NET SALES* $133 12.0% 12.2% • Core sales decreased 11% - product -11% and service -12% $119 $121 9.5% • IT&S product sales -10% • Continue to be impacted by COVID-19 pandemic • Rate of decrease improved from -14% in Q1 • Other produ
Slide 9: Net Sales Waterfall
Net Sales Waterfall* (US$ in millions) $140 $135 $2.9 $11.2 The impact of the COVID-19 pandemic $133.4 (including border $130 closings in the MENAC region) resulted in lower sales year-over-year $125 offset by a $3M benefit $4.4 from foreign currency. We are encouraged by $120 the level of activity
Slide 10: Adjusted EBITDA Waterfall
Adjusted EBITDA Waterfall* (US$ in millions) $20 Adjusted EBITDA decreased year-over- $3.4 $7.3 $18 year primarily due to COVID-19 product $16 $0.0 volume decreases, $16.0 partially offset by $14 restructuring and other cost savings initiatives $12 $2.9 $1.7 resulting in decremental $0.7 $1.1 EBITDA
Slide 11: Liquidity – Positioned for Success
Liquidity – Positioned for Success (US$ in millions) $7 $163 $159 $286 $255 $1 $115 2.1 $210 1.9 Q2 2020 Q1 2021 Q2 2021 1.3 ($9) Q2 2020 Q1 2021 Q2 2021 Q2 2020 Q1 2021 Q2 2021 Q2 2020 Q1 2021 Q2 2021 Free Cash Flow Cash Balance Gross Debt TTM Financial Leverage* Free Cash Flow (FCF) Debt & Leverag
Slide 12: Thoughts on Remainder of Fiscal 2021
Thoughts on Remainder of Fiscal 2021 Anticipate that net sales will return to pre-COVID levels as we exit the fiscal year Expect incremental EBITDA margins on the high end of 35%-45%, excluding the impact of currency Continue to execute our strategy Continue to invest in long-term growth thr
Slide 13: Expectations for Second Half of Fiscal 2021
Expectations for Second Half of Fiscal 2021 Expectations for 2H of Fiscal 2021: Sales of $280 million to $290 million Continued sequential improvement through Q4 Projected year-over-year core growth by category IT&S Product ~ mid 20% Barring any additional COVID related IT&S Service ~ low
Slide 14: Clear Value Creation Model – Long Term Vision
Clear Value Creation Model – Long Term Vision CORE GROWTH ABOVE MARKET DRIVING EFFICIENCY AND PROFITABILITY ~5% CORE GROWTH CAGR OR ~25% EBITDA MARGINS 200-300bps CORE SALES GROWTH > MARKET 35%-45% incremental Completion of service & margins product line restructuring Product innovation Comm
Slide 15: Q&A
Q&A
Slide 16: Appendix
Appendix
Slide 17: Second Quarter 2021 GAAP vs Non-GAAP Reconciliation
Second Quarter 2021 GAAP vs Non-GAAP Reconciliation (US$ in millions except EPS) Less Impairment & Divestiture Restructuring Other Tax GAAP Charges Charges Adjustments Adjusted Sales $120.7 $120.7 Operating Profit $5.7 ($0.4) ($0.6) $0.0 $6.8 Income Taxes $0.0 ($0.1) ($0.0) ($0.6) $0.7 Net Income $3
Slide 18: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures (US$ in millions) Adjusted EBITDA Free Cash Flow Q2 Q2 2021 2020 Q2 Q2 Net Earnings $4 $4 0 2021 2020 Net Financing Costs $1 $5 Income Taxes $0 $1 Cash From Operations $ 5 $ (6) Depreciation & Amortization $6 $5 Capital Expenditures $ (4) $ (4) Restructuring Charg
Slide 19: Adjusted Operating Profit Waterfall
Adjusted Operating Profit Waterfall* (US$ in millions) $14 $3.4 $7.3 $12 Adjusted Operating Profit decreased year- over-year $10 $0.0 primarily due to $9.9 COVID-19 product volume $8 decreases, partially offset by restructuring and $2.8 $0.2 $6 $6.8 other cost $0.7 savings initiatives $1.1 $4 $2 $0
Slide 20: TOOL GROUP
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