Slide 1: Third Quarter 2019 Earnings
BADGER METER THIRD QUARTER 2019 EARNINGS October 17, 2019 © 2019 Badger Meter, Inc. 1
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Certain statements contained in this presentation as well as other information provided from time to time by the Company or its employees, may contain forward looking statements that involve risks and uncertainties that could cause actual results to differ materially from
Slide 3: Third Quarter Highlights
THIRD QUARTER HIGHLIGHTS Adj. EBITDA Margin % * Q3 YTD 21.5% • Sales growth in domestic municipal 20.3% 19.0% 20.1% water market; strong interest in new technology products and solutions. Flow instrumentation growth of 1%. • Adjusted EBITDA margins remain 2018 2019 above 20%; favorable product and F
Slide 4: Third Quarter Financial Snapshot
THIRD QUARTER FINANCIAL SNAPSHOT (US$ in millions, except per share data) Q3 2019 Q3 2018* Change • Global municipal water sales down 3%; up 2% in domestic market against Sales $108.6 $110.6 -1.8% a near-record comparison; favorable Gross Margin 41.7 43.9 -5.2% mix to higher technology products and
Slide 5: Cash Flow / Working Capital
CASH FLOW / WORKING CAPITAL • AR – collection processes reduced DSO from 55 at Q3 2018 to 49 at Q3 2019 • DPO – payment term extension initiatives • Inventory initiatives – SIOP and higher turns while maintaining the choice customers desire • FCF conversion > 100% - capital allocation flexibility •
Slide 6: Outlook / Strategic Initiatives
OUTLOOK / STRATEGIC INITIATIVES BEACON data and analytics • Quote activity, opportunity funnel and backlog to support our growth plans • Positive backdrop with municipal spending trends and our competitive share and positioning • Continuous improvement in global operations and supply chain, working
Slide 7: Q&A
Q&A Note: For your planning purposes, our Q4/Year End 2019 earnings release/call is tentatively scheduled for February 5, 2020 © 2019 Badger Meter, Inc. 7
Slide 8: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS EBITDA Free Cash Flow (US$ in millions) (US$ in millions) Q3 2019 Q3 2018 YTD 2019 YTD 2018 Q3 2019 Q3 2018 Net Earnings (GAAP) $12.7 $2.9 $34.9 $16.5 Cash from Ops (GAAP) $20.2 $14.7 Pension settlement charge 0.0 11.7 0.0 19.9 Capital Expenditures (1.1) (2.0) Execut
Slide 9: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS (US$ in millions except per share data) Q3 2018 YTD 2018 GAAP Adjustments Adjusted GAAP Adjustments Adjusted Sales $110.6 $110.6 $329.3 $329.3 Gross margin 43.9 43.9 122.2 122.2 SEA 28.2 (2.1) 26.1 80.1 (2.1) 78.0 Operating income 15.7 2.1 17.8 42.1 44.2 Other pensio