Innovate Corp. · NYSE:VATE
Innovate — HC2 Holdings — Q4 2020 Earnings Presentation
20 slides from Innovate's earnings presentation, Mar 10, 2021
Slide 1: Q4 2020 Earnings Release Supplement
© HC2 HOLDINGS, INC. 2021 HC2 Holdings, Inc. Q4 2020 Earnings Release Supplement March 10, 2021
Slide 2: Safe Harbor Disclaimers: Forward-Looking Statements
© HC2 HOLDINGS, INC. 2021 Safe Harbor Disclaimers 2 Cautionary Statement Regarding Forward-Looking Statements Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This presentation contains, and certain oral statements made by our representatives from time to time may co
Slide 3: Safe Harbor Disclaimers: Non-GAAP Financial Measures
© HC2 HOLDINGS, INC. 2021 Safe Harbor Disclaimers Non-GAAP Financial Measures In this earnings release supplement, HC2 refers to certain financial measures that are not presented in accordance with U.S. generally accepted accounting principles (“GAAP”), including Adjusted EBITDA (excluding the Insur
Slide 4: Full Year 2020 Summary
© HC2 HOLDINGS, INC. 2021 Full Year 2020 Summary Reshaping a New HC2 ■ Sharpened strategic focus through multiple business divestitures ■ Reduced aggregate debt levels on improved terms with extended maturities ■ Improved flexibility and overall liquidity position ■ Resilient, improving performance
Slide 5: Three Business Focus Areas
© HC2 HOLDINGS, INC. 2021 Three Business Focus Areas Infrastructure Life Sciences Spectrum Recently Divested Other Marine Services Telecom Clean Energy Insurance (1) Sold February 2020 Sold October 2020 Sold January 2021 Received Non- Binding Indication of Interest in December 2020 (30% Interest) So
Slide 6: Three Strategic Focus Areas
© HC2 HOLDINGS, INC. 2021 Three Strategic Focus Areas 6 Infrastructure (DBM Global, Inc.) Life Sciences (Pansend) Spectrum (HC2 Broadcasting) Structural and industrial services company with primary assets in steel fabrication and erection, as well as ongoing service and maintenance for various indus
Slide 7: Enhanced Capitalization
© HC2 HOLDINGS, INC. 2021 7 Enhanced Capitalization Balance Sheet Initiatives Debt1 Equity ■ Completed refinancing with $330M senior secured note offering ◦ Extended maturity to 2026 ◦ Reduced cost of debt by 300 bps ◦ Repaid $15M revolver in full ■ Extended maturity of ~$52M of senior convertible n
Slide 8: Current Credit Picture: Debt Summary and Maturity Profile
© HC2 HOLDINGS, INC. 2021 1) PF 2020 Cash & Cash Equivalents includes subsidiary cash as of December 31, 2020 and PF $48M of HC2 Holdco cash post-refinancing. 2) Debt Maturity Profile excludes Preferred Stock which have varying maturities Debt Summary (in millions) Maturity Dec-19 Dec-20 PF 2020 11.
Slide 9: Q4 2020 Financial Highlights
© HC2 HOLDINGS, INC. 2021 Q4 2020 Financial Highlights Revenue (in millions) 4Q20 4Q19 FY20 FY19 Infrastructure $ 167.0 $ 157.1 $ 676.6 $ 713.3 Insurance 77.0 80.3 300.2 331.6 Spectrum 11.0 12.0 40.3 41.8 Other — 0.5 — 0.5 Eliminations (1) (3.2) (2.3) (11.3) (10.2) Consolidated HC2 $ 251.8 $ 247.6 $
Slide 10: Infrastructure Highlights
© HC2 HOLDINGS, INC. 2021 Highlights ■ 2020 results impacted by COVID-19, which caused delays in new project awards, and timing and mix of project backlog ■ Adjusted backlog, which takes into consideration awarded but not yet signed contracts, is $608M; provides visibility into 2021/2022 Near-term O
Slide 11: Life Sciences Summary of Investments
© HC2 HOLDINGS, INC. 2021 1 Investment-to-date totals and equity ownership percentages are as of December 31, 2020; fully diluted includes all exercisable options and warrants. 2 MediBeacon agents and devices are not approved for human use by any regulatory agency. Other Investments Genovel Orthoped
Slide 12: Spectrum Highlights
© HC2 HOLDINGS, INC. 2021 Highlights ■ Q4 2020 was first quarter of positive Adjusted EBITDA at Spectrum ■ Completed carriage deals with CBS, NBC, Tegna, iMedia, others ■ Improved balance sheet and reduced net debt Y/Y by $32.3M with proceeds from select full power station sales ■ Built out silent s
Slide 13: Insurance Highlights
© HC2 HOLDINGS, INC. 2021 Highlights ■ Implemented rate increases pursuant to approvals from state regulatory bodies, which are a key driver for profitability ■ Continued to manage COVID-19's impact on policyholders and workforce and adjusted portfolio mix in response to COVID-19 Indication of Inter
Slide 14: Appendix: Select GAAP Financials & Non-GAAP Reconciliations
© HC2 HOLDINGS, INC. 2021 Appendix Select GAAP Financials & Non-GAAP Reconciliations 14
Slide 15: HC2 Selected GAAP Financials - Income Statement
© HC2 HOLDINGS, INC. 2021 HC2 Selected GAAP Financials - Income Statement (in millions, except per share amounts) Three Months Ended December 31, Years Ended December 31, 2020 2019 2020 2019 Net revenue $ 251.8 $ 247.6 $ 1,005.8 $ 1,077.0 Total operating expenses 225.8 288.0 1,009.9 1,051.7 Income (
Slide 16: Reconciliation to Adjusted EBITDA: Three Months Ended Dec 31, 2020
© HC2 HOLDINGS, INC. 2021 Reconciliation of U.S. GAAP Income (Loss) to Adjusted EBITDA (in millions) Three Months Ended December 31, 2020 Infrastructure Life Sciences Spectrum Other and Eliminations Non-operating Corporate HC2 Net loss attributable to HC2 Holdings, Inc. $ (4.7) Less: Net income attr
Slide 17: Reconciliation to Adjusted EBITDA: Twelve Months Ended Dec 31, 2020
© HC2 HOLDINGS, INC. 2021 Reconciliation of U.S. GAAP Income (Loss) to Adjusted EBITDA (in millions) Twelve Months Ended December 31, 2020 Infrastructure Life Sciences Spectrum Other and Eliminations Non-operating Corporate HC2 Net loss attributable to HC2 Holdings, Inc. $ (92.0) Less: Net Income at
Slide 18: Reconciliation to Adjusted EBITDA: Three Months Ended Dec 31, 2019
© HC2 HOLDINGS, INC. 2021 Reconciliation of U.S. GAAP Income (Loss) to Adjusted EBITDA (in millions) Three Months Ended December 31, 2019 Infrastructure Life Sciences Spectrum Other and Eliminations Non-operating Corporate HC2 Net loss attributable to HC2 Holdings, Inc. $ (31.0) Less: Net loss attri
Slide 19: Reconciliation to Adjusted EBITDA: Twelve Months Ended Dec 31, 2019
© HC2 HOLDINGS, INC. 2021 Reconciliation of U.S. GAAP Income (Loss) to Adjusted EBITDA (in millions) Twelve Months Ended December 31, 2019 Infrastructure Life Sciences Spectrum Other and Eliminations Non-operating Corporate HC2 Net loss attributable to HC2 Holdings, Inc. $ (31.5) Less: Net Income at
Slide 20: Reconciliation of U.S. GAAP Income to Pre-tax Insurance AOI
© HC2 HOLDINGS, INC. 2021 Reconciliation of U.S. GAAP Income to Pre-tax Insurance AOI (1) The Insurance segment results are inclusive of realized and unrealized gains and net investment income for the three and twelve months ended December 31, 2020 and 2019, inclusive of transactions between entitie