Enpro Inc. · NYSE:NPO
Enpro — EnPro Industries — Q1 2019 Earnings Presentation
19 slides from Enpro's earnings presentation, May 2, 2019
Slide 1: First Quarter 2019 Earnings Review
ENPRO INDUSTRIES FIRST QUARTER 2019 EARNINGS REVIEW MAY 2, 2019
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Statements made in the course of this presentation that express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements under the Private Securities Litigation Reform Act of 1995. They involve a number of risks and
Slide 3: Agenda
AGENDA 1 CEO Comments 2 Guidance 3 First Quarter Operations Highlights 4 Overview of Financial Results Quarterly Results Capital Allocation Net Debt & Liquidity 3
Slide 4: CEO Comments
CEO COMMENTS Steve Macadam – President & Chief Executive Officer
Slide 5: 2019 Guidance
2019 GUIDANCE GUIDANCE COMMENTARY (1) ● Expect full-year adjusted EBITDA to be between $224 and $232 million and adjusted diluted EPS to be between $4.25 to $4.52 ● Revised range reflects the impact of the stronger dollar on the EDF contract in Power Systems 2019 Guidance(1) Low High Adjusted EBITDA
Slide 6: COO Comments
COO COMMENTS Marvin Riley – Executive Vice President & Chief Operating Officer
Slide 7: First Quarter Operations Highlights
FIRST QUARTER OPERATIONS HIGHLIGHTS ● Starting to see early benefits of countermeasures that are underway in Engineered Products ○ Reorganization plan, hiring freeze, and reduction of temporary workers ○ Cost control measures ○ Inventory reduction ● Focusing on a high standard of excellence across t
Slide 8: Overview of Financial Results
OVERVIEW OF FINANCIAL RESULTS Milt Childress – Executive Vice President & CFO
Slide 9: Sales & Adjusted EBITDA
SALES & ADJUSTED EBITDA $ in millions SALES ● Organic sales were relatively flat compared to the first quarter of 2018 ● Strong growth in Power Systems’ military marine engines and aftermarket parts and services, offset by weakness in Engineered Products’ European and Asian markets, power generation
Slide 10: Gross Margin
GROSS MARGIN GROSS PROFIT & MARGIN $ in millions ● First quarter gross profit was down 9.6% compared to the same period of 2018 ● Gross profit margin decrease of 2.5 percentage points compared to the first quarter of 2018 ○ IT reclassification from SG&A to improve cost allocation ○ Transition to out
Slide 11: Sealing Products
SEALING PRODUCTS SALES SEGMENT ADJUSTED EBITDA & MARGIN $ in millions $ in millions MARKET CONDITIONS KEY DEVELOPMENTS ● Excluding impact of FX translation, sales decreased ● Excluding impact of FX translation, segment adjusted 1.8% EBITDA decreased 6.7% ● Strength in the food & pharma and petrochem
Slide 12: Engineered Products
ENGINEERED PRODUCTS SALES SEGMENT ADJUSTED EBITDA & MARGIN $ in millions $ in millions MARKET CONDITIONS KEY DEVELOPMENTS ● Sales decline due to FX translation and weakness in ● Excluding impact of FX translation, segment adjusted European and Asian automotive and general industrial EBITDA decreased
Slide 13: Power Systems
POWER SYSTEMS SALES SEGMENT ADJUSTED EBITDA & MARGIN $ in millions $ in millions MARKET CONDITIONS KEY DEVELOPMENTS ● Sales increased 10% ● Excluding the impact of foreign exchange on the EDF ● Strength in aftermarket parts and services sales and contract, segment adjusted EBITDA in Power Systems ye
Slide 14: Adjusted Diluted Earnings Per Share
ADJUSTED DILUTED EARNINGS PER SHARE ● Adjusted diluted EPS in Q1 2019 of $0.72/share was down 13.3% compared to the first quarter of the prior year ADJUSTED DILUTED EARNINGS PER SHARE ($ and shares in millions, except per share data) Q1 2018 Q1 2019 Adjusted EBITDA $51.4 $43.1 Less: Interest (7.8) (
Slide 15: Capital Allocation Overview
CAPITAL ALLOCATION OVERVIEW CAPITAL EXPENDITURES ● Invested $10.4M in facilities, equipment and software DIVIDENDS ● Paid $0.25/share dividend totaling $5.4M SHARE REPURCHASES ● Repurchased 36K shares for a total value of ~$2.4 million under the $50 million program authorized by the Board last Octob
Slide 16: Net Debt & Liquidity Summary
NET DEBT & LIQUIDITY SUMMARY LIQUIDITY IN 2019 ● Received federal tax refunds of $17.1M in Q1 2019 ● Anticipate receiving the final refund payment of $19.3 million by the end of 2019, although the timing is uncertain ● Q1 2019 cash balance of approximately $131M ● Q1 2019 total borrowings of approxi
Slide 17: Questions
QUESTIONS
Slide 18: Appendix
APPENDIX
Slide 19: LTM EBITDA Calculation
LTM EBITDA CALCULATION Er”=ro Industries (Stated in Millions of Dollars) Adjusted EBITDA Three Months Ended March 31, 2019 (A) $ 43.1 Year Ended December 31, 2018 217.4 Less: Three Months Ended March 31, 2018 (A) 51.4 Trailing Twelve Months Ended March 31, 2019 $ 209.1 (A) For reconciliations of net