Ingersoll Rand Inc. · NYSE:IR
Ingersoll Rand — Gardner Denver — Investor Presentation (November 2011)
29 slides from Ingersoll Rand's investor presentation, Nov 9, 2011
Slide 1: Gardner Denver Investor Presentation, November 2011
SF PowerPoint Template 03-27-08/2 Gardner Denver Investor Presentation November, 2011 Exhibit 99.1 Safe Harbor Disclosure All of the statements made by Gardner Denver in this presentation or made orally in connection with it, other than historical facts, are forward-looking statements. As a general
Slide 2: Gardner Denver Overview
Gardner Denver Overview
Slide 3: Gardner Denver Overview
Gardner Denver Overview Early stages of transformation to a high quality, high margin Industrial Company with Energy exposure Leading brands and technologies … strong distribution New, operationally focused team driving “The Gardner Denver Way” ~$2.4B (1) global Company with diverse and attractive e
Slide 4: A global leader in compressed air and gas, vacuum and fluid transfer technologies
SF PowerPoint Template 03-27-08/5 A global leader in compressed air and gas, vacuum and fluid transfer technologies We serve a wide range of industries with efficient & reliable products Energy Medical Mining Transportation Food & Beverage
Slide 5: Two business segments aligned to effectively serve our customers
Engineered Products Group Industrial Products Group ~$1.2B ~$1.1B Two business segments aligned to effectively serve our customers 2011 Sales by segment (1) Company estimates (see note on p. 31) (1) Petroleum pumps Liquid ring pumps Loading arms OEM compressors Compressors (>50psi) Blowers (<50psi)
Slide 6: Well established sales channels
SF PowerPoint Template 03-27-08/7 10% Direct 57% OEM 33% Engineered Products Group Industrial Products Group Distribution 48% Direct 33% OEM 19% Well established sales channels Distribution Products designed for customer specific applications Primarily standard configuration products
Slide 7: Highly diversified and global
Highly diversified and global End Markets (1) Geographic Industrial Manufacturing (28%) Upstream Energy (12%) Downstream Energy (10%) Medical/ Laboratory (9%) Transportation (9%) Food & Beverage (6%) Mining & Construction (5%) Chemical (5%) Environment (3%) Printing (2)% Auto Svcs (2%) Paper (2)%) O
Slide 8: Exposed to multiple phases of the economic cycle
SF PowerPoint Template 03-27-08/9 Early Cycle (1-18 months) Late Cycle (36+ months) Mid Cycle (18-36 months) Exposed to multiple phases of the economic cycle Engineered packages Infrastructure projects Industrial air compressors OEM Aftermarket
Slide 9: Current end market dynamics
SF PowerPoint Template 03-27-08/10 Current end market dynamics Comment Status Strong growth in Americas Well servicing and drilling pump demand very strong China softening, APAC strong Stable U.S. Industrial Production - Capacity utilization E.U. Industrial Production Oil & Gas - Rig count, crude /
Slide 10: Strong track record on cost reductions since 2008
SF PowerPoint Template 03-27-08/11 Strong track record on cost reductions since 2008 Prepared for economic volatility Cautiously optimistic on macro economy … contingency plans in the works since April 2011 Headcount (23)% reduction / 2,700 employees Footprint Closed plants One ERP 71% + bps Operati
Slide 11: Growth Strategy
Growth Strategy
Slide 12: Simple, focused 5-point strategy
4. Selective acquisitions 2. Aftermarket growth 5. Margin expansion 3. Innovative products 1. Organic growth • Strengthen presence in attractive end markets & emerging markets • Access to faster growing end markets and generate synergies Strategy Focus • Higher margin, less cyclical • Cost reduction
Slide 13: Organic growth
SF PowerPoint Template 03-27-08/14 ’11E (1) ~$600 Organic growth Keys to organic growth • Leading brands & technologies Orders ~10% • Diverse end markets … strong distribution channels ‘10 $554 Backlog ’11E (1) ~$2.5B ~20% ‘10 $2,060 ‘09 $1,570 ‘09 $395 • Growing emerging markets presence • Higher g
Slide 14: Build out the aftermarket
SF PowerPoint Template 03-27-08/15 Build out the aftermarket Key growth drivers • Large installed base Aftermarket as % of sales • Big opportunity in pressure pumping repair and fluid ends ‘10 31% ‘09 29% ‘08 26% • Remote monitoring capabilities • Design in proprietary features Goal 40-45% • Extende
Slide 15: A more innovative Company
SF PowerPoint Template 03-27-08/16 A more innovative Company Voice of customer differentiates products from competition Value proposition based on customer needs 2011 product launches across multiple divisions demonstrate progress PZ-2400 Drilling Pump Hoffman Revolution Quantima Compressor Goal: ~1
Slide 16: Acquisitions over 15 years
Engineered Products Group Industrial Products Group 24 acquisitions over 15 years TCM Twentieth Century Mfg . Water Jetting • Butterworth • CRS Power Flow • Jetting Systems Strong track record on analyzing & integrating acquisitions
Slide 17: IPG Margin Expansion
1 2 3 IPG Margin Expansion 1Q09 1Q10 2.0% 2Q09 3Q09 4Q09 Quarters of Sequential Margin Expansion (2) 2Q10 2Q11 3Q10 4Q10 1Q11 3Q11 2.5% 6.8% 7.5% 8.3% 8.6% 9.4% 10.1% 11.3% 11.7% 13.1% Goal 14% +150 bps of margin expansion annually w/no volume growth: Restructuring … 27% reduction in employment sinc
Slide 18: EPG Margin Expansion
1 2 3 EPG Margin Expansion 1Q09 1Q10 19.5% 2Q09 3Q09 4Q09 EPG Margin Expansion (2) 2Q10 2Q11 3Q10 4Q10 1Q11 3Q11 19.7% 17.8% 20.9% 16.0% 19.5% 19.7% 24.0% 22.9% 23.3% 23.6% Last Peak 24.5% +50 bps of margin expansion annually w/ no volume growth: Restructuring … reduced employment by 15% since ’08 w
Slide 19: Financial Results
Financial Results
Slide 20: A decade of financial performance
SF PowerPoint Template 03-27-08/21 $379 $1,215 $1,895 Revenue $3.28 $1.37 $0.60 DEPS $31 $115 $202 Cash Flow from Operations A decade of financial performance 17% CAGR Strong track record 19% CAGR 21% CAGR ($’s in millions)
Slide 21: 2011 financial outlook
$1.9B ~$2.4B Revenue $5.44 - $5.49 $3.39 Adjusted DEPS (2) $202 ~$300 2011 financial outlook ~25% ~60% 1.2 x Net Income A record year on key financial metrics (1) Company estimates (see note on p. 31) (1) Cash Flow from Operations (2) Adjusted DEPS (see note on p. 31) (in line with guidance)
Slide 22: Strong cash generation
SF PowerPoint Template 03-27-08/23 $237 $169 $169 ~$250 1 2 3 4 Strong cash generation Cash Flow Disciplined capital deployment FCF CFOA 2011E $278 $211 $202 ~$300 FCF Conv. 143% N/M 98% ~90% (1) ($’s in millions) (1) Company estimates (see note on p. 31) Capital expenditures … organic growth and pr
Slide 23: Internal long term operating goals
SF PowerPoint Template 03-27-08/24 Internal long term operating goals progress • Grow 2 x GDP Operating goals Good progress YTD … more to do 3Q YTD Comment • Margin expansion • FCF Conversion • Increase ROIC • Lean cost structure + + + / + + • Revenue up 29% • DEPS up 74% • 86% • ROIC ~19% • 16.8% S
Slide 24: 2012 earnings growth framework
2012 earnings growth framework Tailwinds: + Margin expansion “The Gardner Denver Way” + Orders momentum / EPG backlog + Strength in Energy end markets + Aftermarket momentum + Accretive M&A … Robuschi + Reduced share count Headwinds: – Macro uncertainty incl. China, Europe – Late cycle infrastructur
Slide 25: The Gardner Denver Way
The Gardner Denver Way
Slide 26: Strategy supported by The Gardner Denver Way
Aftermarket growth Innovative products Selective acquisitions Margin expansion Organic growth CUSTOMERS Innovation High Velocity SHAREHOLDERS EMPLOYEES RESOURCES Strategy supported by The Gardner Denver Way Execution requires superior human resources
Slide 27: Building a high performance culture
Building a high performance culture New, operationally focused management team driving transformation Operationally focused team Policy deployment Operating rhythms Clear accountability Continuous improvement
Slide 28: Gardner Denver Summary
Gardner Denver Summary Early stages of transformation to a high quality, high margin Industrial Company with Energy exposure Leading brands and technologies … strong distribution New, operationally focused team driving “The Gardner Denver Way” ~$2.4B (1) global Company with diverse and attractive en
Slide 29: Presentation notes
SF PowerPoint Template 03-27-08/31 Gardner Denver Investor Presentation November, 2011 Presentation notes • Note 1: Company estimates • Note 2: Adjusted Operating Income, Adjusted Operating Margins, Adjusted Net Income and Adjusted DEPS are financial measures that are not in accordance with US GAAP.
Gardner Denver — Investor Presentation (November 2011) on 6ix