Slide 1: Third Quarter 2012 Earnings Conference Call
Third Quarter 2012 Earnings Conference Call October 25, 2012
Slide 2: Forward-Looking Statements
2 The following information contains forward - looking statements, including forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward - looking statements include, but are not limited to, statements concerning Colfax's plans, objectives, e
Slide 3: Q3 2012 Results
Q3 2012 Results 3 COLFAX
Slide 4: Q3 2012 Highlights
4 Q3 2012 Highlights • Adjusted net income of $40.7 million ($0.33 per share) compared to $13.2 million ($0.30 per share) in Q3 2011, which includes a non - cash 3 cents per share gain related to adjustments to deferred tax balances • Net sales of $954.4 million, a decrease of 1.8% from Q3 2011 prof
Slide 5: Year to Date 2012 Highlights
5 Year to Date 2012 Highlights • Adjusted net income of $109.3 million ($0.92 per share) compared to $35.2 million ($0.79 per share) in Q3 2011 • Net sales of $2.9 billion, an increase of 3.5% from the nine months ended September 30, 2011 proforma net sales of $2.8 billion • Adjusted operating incom
Slide 6: Gas- and Fluid-Handling
Gas- and Fluid- Handling 6 COLFAX
Slide 7: Gas- and Fluid-Handling Q3 2012 Highlights
7 Gas - and Fluid - Handling Q3 2012 Highlights • Net sales of $464.9 million compared to proforma net sales of $423.0 million in Q3 2011, an increase of 9.9%; an organic increase of 14.6% • Adjusted segment operating income of $51.7 million and adjusted segment operating income margin of 11.1% • Q3
Slide 8: Gas- and Fluid-Handling YTD 2012 Highlights
8 Gas - and Fluid - Handling YTD 2012 Highlights • Net sales of $1.4 billion compared to proforma net sales of $1.2 billion in the nine months ended September 30, 2011, an increase of 13.0%; an organic increase of 14.4% • Adjusted segment operating income of $153.3 million and adjusted segment opera
Slide 9: Orders and Backlog
9 Orders and Backlog 9 Orders (1) $451.2 $443.8 $1,425.6 $1,475.7 $0.0 $250.0 $500.0 $750.0 $1,000.0 $1,250.0 $1,500.0 Q3 2011 Q3 2012 YTD 2011 YTD 2012 Backlog (1) $0.0 $250.0 $500.0 $750.0 $1,000.0 $1,250.0 $1,500.0 Q3 2009Q4 2009Q1 2010Q2 2010Q3 2010Q4 2010Q1 2011Q2 2011Q3 2011Q4 2011Q1 2012Q2 20
Slide 10: Revenue
10 Revenue 10 Revenue (1) $423.0 $464.9 $1,226.7 $1,386.7 $0.0 $250.0 $500.0 $750.0 $1,000.0 $1,250.0 $1,500.0 Q3 2011 Q3 2012 YTD 2011 YTD 2012 (1) Q3 2011 and YTD 2011 sales are presented on a proforma basis. __________________ Note: Dollars in millions (unaudited). Aftermarket Revenue – YTD 2012
Slide 11: Q3 2012 Sales and Orders by End Market
11 Q3 2012 Sales and Orders by End Market 11 Sales: $464.9 million Orders: $443.8 million Total Growth (Decline) Organic Growth (Decline) Power Generation 19.5 % 22.8 % Oil, Gas & Petrochemical 10.0 % 14.7 % Marine (16.5)% (10.7)% Mining 39.7 % 46.0 % General Industrial & Other 3.9 % 8.9 % Total 9.9
Slide 12: YTD 2012 Sales and Orders by End Market
12 YTD 2012 Sales and Orders by End Market 12 Sales: $1,386.7 million Orders: $1,475.7 million Total Growth (Decline) Organic Growth (Decline) Power Generation 20.0 % 22.1% Oil, Gas & Petrochemical 18.6 % 13.0% Marine (11.9)% (7.1)% Mining 36.3 % 43.0 % General Industrial & Other 7.2 % 10.6 % Total
Slide 13: Power Generation Market Perspective
13 Power Generation Market Perspective 13 Sales & Orders Growth Q3 2012 vs. Q3 2011 YTD 2012 vs. YTD 2011 Total Organic Total Organic Sales 19.5% 22.8% 20.0% 22.1% Orders 8.5% 10.6% 16.4% 18.5% Colfax YTD 2012 Sales Split 31% Power Gen. Colfax YTD 2012 Orders Split Highlights ▪ Served by both Howden
Slide 14: Oil, Gas & Petrochemical Market Perspective
14 Oil, Gas & Petrochemical Market Perspective 14 Sales & Orders Growth (Decline) Colfax YTD 2012 Sales Split 25% OG&P Colfax YTD 2012 Orders Split 24% OG&P Highlights ▪ Served by both Howden and Colfax Fluid Handling ▪ National oil companies in Latin America and Russia expanding production and refi
Slide 15: Marine Market Perspective
15 Marine Market Perspective 15 Sales & Orders (Decline) Growth Colfax YTD 2012 Sales Split 12% Marine Colfax YTD 2012 Orders Split Highlights ▪ Comprised of commercial marine and government, or defense, customers ▪ Primarily served by Colfax Fluid Handling ▪ New ship build is down from 2011 peak ▪
Slide 16: Mining Market Perspective
16 Mining Market Perspective 16 Sales & Orders Growth (Decline) Colfax YTD 2012 Sales Split 9% Mining Colfax YTD 2012 Orders Split Highlights ▪ Primarily served by Howden ▪ Includes centrifugal and axial fans, providing mine ventilation ▪ Driven by demand of mined resources, including: coal, iron or
Slide 17: General Industrial & Other Market Perspective
17 General Industrial & Other Market Perspective 17 Sales & Orders Growth (Decline) Colfax YTD 2012 Sales Split 23% GI&O Colfax YTD 2012 Orders Split Highlights ▪ Includes both Howden and Colfax Fluid Handling ▪ Represents a variety of industrial fans and compressors, tunnel ventilation and pumps se
Slide 18: Fabrication Technology
18 18 Fabrication Technology
Slide 19: Fabrication Technology Q3 2012 Highlights
19 Fabrication Technology Q3 2012 Highlights • Net sales of $489.6 million compared to proforma net sales of $548.8 million in Q3 2011, a decrease of 10.8%; an organic decline of 2.2% • Adjusted segment operating income of $43.9 million and adjusted operating income margin of 9.0% • Tight cost contr
Slide 20: Fabrication Technology YTD 2012 Highlights
20 Fabrication Technology YTD 2012 Highlights • Net sales of $1.5 billion, a decrease of 4.0% compared to proforma YTD Q3 2011 sales; an organic increase of 3.3% • Adjusted segment operating income of $123.2 million and adjusted operating income margin of 8.2% • Higher consumable volumes in North Am
Slide 21: Revenue
21 Revenue 21 Revenue (1) $548.8 $489.6 $1,562.5 $1,449.8 $0.0 $200.0 $400.0 $600.0 $800.0 $1,000.0 $1,200.0 $1,400.0 $1,600.0 Q3 2011 Q3 2012 YTD 2011 YTD 2012 (1) Q3 2011 and YTD 2011 sales are presented on a proforma basis. __________________ Note: Dollars in millions (unaudited). Revenue – YTD 2
Slide 22: Results of Operations
Results of Operations 2 COLFAX
Slide 23: Income Statement Summary (Three Months)
23 Income Statement Summary (unaudited) 23 Refer to Appendix for Non - GAAP reconciliation and footnotes. __________________ Note: Dollars in millions, except per share amounts Three Months Ended September 28, 2012 September 30, 2011 Net sales $ 954.4 $ 170.3 Gross profit $ 288.0 $ 60.7 % of sales 3
Slide 24: Income Statement Summary (Nine Months)
24 Income Statement Summary (unaudited) 24 Refer to Appendix for Non - GAAP reconciliation and footnotes. __________________ Note: Dollars in millions, except per share amounts Nine Months Ended September 28, 2012 September 30, 2011 Net sales $ 2,886.5 $ 515.6 Gross profit $ 844.6 $ 178.6 % of sales
Slide 25: Appendix
Appendix 2s COLFAX
Slide 26: Disclaimer
26 Disclaimer 26 Colfax has provided financial information that has not been prepared in accordance with GAAP. These non - GAAP financial measures are adjusted net income, adjusted net income per share, projected adjusted net income per share, adjusted operating income, organic sales growth (decline
Slide 27: Non-GAAP Reconciliation
27 Non - GAAP Reconciliation (unaudited) ____________________ Note: Dollars in thousands, except per share amounts. (1) The effective tax rates used to calculate adjusted net income and adjusted net income per share are 25.3% and 29% for the thi rd quarter and nine months ended September 28, 2012, r
Slide 28: Non-GAAP Reconciliation
28 Non - GAAP Reconciliation (unaudited) ____________________ Note: Dollars in thousands. Net sales -$ -$ Operating income 32,361 7.0% 31,357 6.4% (12,052) 51,666 5.4% 15,471 9.1% (10,031) 5,440$ 3.2% Charter acquisition-related expense - - - - - 5,728 5,728 Restructuring and other related charges 1
Slide 29: Non-GAAP Reconciliation
29 Non - GAAP Reconciliation (unaudited) ____________________ Note: Dollars in thousands. Net sales -$ -$ Operating income 93,467 6.7% 74,642 5.0% (80,268) 87,841 3.0% 54,861$ 10.6% (21,382)$ 33,479$ 6.5% Charter acquisition-related expense - - 43,617 43,617 - 5,728 5,728 Restructuring and other rel
Slide 30: Sales & Order Growth
30 Sales & Order Growth (unaudited) ____________________ Note: Dollars in millions. $ % $ % Proforma for the three months ended September 30, 2011 971.7$ 451.2$ Components of Change: Existing Businesses 49.5 5.1 % 18.0 4.0 % Acquisitions 5.3 0.5 % 4.2 0.9 % Foreign Currency Translation (72.1) (7.4)%
Slide 31: Balance Sheet
31 Balance Sheet (unaudited) September 28, December 31, 2012 2011 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 517,343 $ 75,108 Tradereceivables,lessallowancefordoubtfulaccountsof$8,920 and $2,578 882,867 117,475 Inventories, net 519,358 56,136 Other current assets 313,948 102,489 Total curren
Slide 32: 2012 Outlook Summary (October Update)
32 2012 Outlook Summary (October Update) Note: Guidance as of 10/25/12 In thousands, except per share data Revenue- Base Business 994,000$ 1,040,000$ Acquired Entities 20,000 24,000 Revenue 1,014,000$ 1,064,000$ 3,900,000$ 3,950,000$ Adjusted Operating Profit 95,000 101,700 340,900 347,600 Interest
Slide 33: Non-GAAP Reconciliation
33 Non - GAAP Reconciliation (unaudited) Projected net loss per share - diluted $ 0.15 $ 0.19 $ (0.98) $ (0.94) Participating shares adjustment - - 0.13 0.13 Fair value adjustments - Charter inventory and backlog 0.15 0.15 0.78 0.78 Restructuring costs 0.07 0.07 0.48 0.48 Asbestos coverage litigatio