Trane Technologies Plc · NYSE:TT
Trane Technologies — Ingersoll Rand — Q2 2015 Earnings Presentation
16 slides from Trane Technologies's earnings presentation, Jul 28, 2015
Slide 1: Second-Quarter 2015 Results
Second-Quarter 2015 Results July 28, 2015
Slide 2: Safe Harbor
Safe Harbor This presentation includes “forward-looking statements,” which are statements that are not historical facts, including statements that relate to the mix of and demand for our products, performance of the markets in which we operate, our share repurchase program including the amount of sh
Slide 3: Second-Quarter 2015 highlights
Second-Quarter 2015 highlights Revenue and Operating Margin • Adjusted EPS from continuing ops: $1.20 • Revenue of $3,600M, organic revenue (exFX +2% $3,600M and acquisitions) +3% $3,543M Strong growth in N. America Transport +5% and Commercial HVAC; good organic exFX growth in Transport and Comme
Slide 4: Quarterly Year-Over-Year Order Change
Quarterly Year-Over-Year Order Change Orders, % Change Excluding Currency Reported ExFX 8% Q4 ′13 5% 5% Q1 ′14 5% 5% 7% 7% Q2 5% 5% Q3 7% 8% 6% Q4 5% 7% 5% 5% Q1 ′15 3% 7% 5% Q2 2% 6% Organic 4% Organic Q2 2015 % Change vs. Q2 2014 Reported ExFX Climate 3% 6% Industrial -1% 5% Total 2% 6% Q1 2014 Q2
Slide 5: Q2 2015 Revenue Change
Q2 2015 Revenue Change Segment Revenue Change 2% Reported Climate Organic 5% -1% Industrial -4% Geographic Revenue Change Reported Organic Americas U.S. +5% 5% 4% Europe, Middle -9% East, Africa 3% Asia -6% -4% Q2 organic revenue up 3% 5
Slide 6: Q2 2015 Operating Margin
Q2 2015 Operating Margin Operating Leverage Reported Adjusted* Year-Over-Year Revenue Change $ 57M $ 57M Year-Over-Year Op. Income Change $ (11)M $ 5M Leverage NM 10% Organic** Leverage 31% 0.9 (0.9) 13.1% (0.7) 0.2 12.6% Acquisitions (0.5) Investment/other (0.3) Volume/Mix (0.3) Restructuring (0.1)
Slide 7: Climate Segment
Climate Segment Q2 Revenue and Operating Margin • Climate bookings up 6% (exFX); up high-single digits in N. America with Commercial HVAC bookings up mid-teens; Solid bookings (exFX) growth in Europe was slightly offset $2,816M by muted demand in Asia and market deceleration in L. +2% $2,749M Americ
Slide 8: Industrial Segment
Industrial Segment • Industrial organic bookings down 1% and revenues Q2 Revenue and Operating Margin down 4% • Air and industrial products organic bookings down -1% $785M low-single digits and organic revenues down $794M mid-single digits. Organic revenues down in all +5% geographic regions exFX •
Slide 9: Tax Update
Tax Update • Entered into agreement with IRS on July 17 for tax years 2002 to 2011 to resolve the dispute related to intercompany debt for $230 million in tax plus interest • No penalties will apply with regard to any of the tax years 2002-2011 and no additional tax will be owed with respect to thes
Slide 10: Working Capital as a % of Revenues
Working Capital as a % of Revenues $ Millions YE 13 YE 14 Q1 15 Q2 15 Cash 1,937 1,705 734 780 Debt 3,521 4,224 4,544 4,394 6.3% Net Debt 1,584 2,519 3,810 3,614 5.8% 4.4% 4.0% 4.0% 3.1% 2014 Q1 Q2 Q3 Q4 2015 Q1 Q2 2015 full-year adjusted free cash flow target $950M to $1B* 10 *Adjusted free cash fl
Slide 11: Full-Year 2015 Forecast
Full-Year 2015 Forecast Y-O-Y Adjusted Revenue Markets Operating Change Margin Climate • Commercial HVAC equipment ‒ Reported 3% to 4% replacement and aftermarket growing low- to mid-single digits ‒ Organic 6% to 7% • Transport high-single digit growth in ~13% N. America and low-single digit decline
Slide 12: Forecast 2015
Forecast 2015 Full Year Q3 Y-O-Y reported revenue change 4% to 5% 4% to 5% • Organic 4% to 5% 5% to 6% • Currency (3%) to (4%) (3%) to (4%) • Acquisitions 2% to 3% 2% to 3% EPS continuing – reported* $2.59 to $2.74 $1.13 to $1.17 - Inventory step-up costs $0.06 0.19 ----- and Venezuela currency $0.1
Slide 13: Appendix
LEY Ingersoll Rand. Appendix
Slide 14: Q3 2015 Guidance Bridge
Q3 2015 Guidance Bridge 2014 EPS Continuing Operations $1.10 Restructuring costs (0.02) Operations improvement 0.20 to 0.24 Investments (0.05) Currency (0.09) Acquisitions* (0.01) EPS Continuing Reported 1.13 to 1.17 Restructuring 0.02 Adjusted EPS $1.15 to $1.19 *Includes acquisition operating resu
Slide 15: Year-Over-Year Revenue Change
Year-Over-Year Revenue Change Reported 2013 2014 2015 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Climate 4% 4% 4% 6% 5% 5% 6% 2% Industrial Flat Flat 4% 3% 3% 3% 7% (1%) Total Ingersoll Rand 3% 3% 4% 5% 5% 4% 6% 2% Organic 2013 2013 2014 2015 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Climate 4% 5% 4% 6% 7% 6% 9% 5% Industrial (1%) Flat
Slide 16: am) Ingersoll Rand.
am) Ingersoll Rand.