Slide 1: Q3 2022 Earnings Conference Call
Q3 2022 Earnings Conference Call
Slide 2: Forward-Looking Statements
Brunswick Corporation - Earnings Release Forward-Looking Statements Certain statements in this presentation are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations, estimates, and projections abou
Slide 3: Use of Non-GAAP Financial Information and Constant Currency Reporting
Brunswick Corporation – Earnings Release Use of Non-GAAP Financial Information and Constant Currency Reporting In this presentation, Brunswick uses certain non-GAAP financial measures, which are numerical measures of a registrant’s historical or future financial performance, financial position or ca
Slide 4: Business Overview
BUSINESS OVERVIEW Dave Foulkes - CEO |4 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 5: Exceptional Performance Across the Company
Brunswick Corporation – Earnings Release Exceptional Performance Across the Company BRUNSWICK DELIVERED THE BEST THIRD QUARTER PERFORMANCE I N C O M PA N Y H I S T O RY RECORD Q3 TOP-LINE HEALTHIER FY 2022 PERFORMANCE GROWTH INVENTORY GUIDANCE POSITION • Net sales of $1.7B (up • Outstanding propulsi
Slide 6: Hurricane Ian
Brunswick Corporation – Earnings Release Hurricane Ian ECONOMIC EFFECT • Florida has the largest U.S. state boat population with nearly one million registered boats • Multi-billion-dollar economic impact estimated across the affected areas ENTERPRISE SUPPORT • Nearly 4,000 Brunswick employees locate
Slide 7: External Dynamics
Brunswick Corporation – Earnings Release External Dynamics S U P P LY C H A I N CONSUMER ACTIVITY DEALER SENTIMENT • Some outboard production lost • Boating participation remains at prior • Dealer meetings remain positive with and 2,500 mid-range outboard year levels with warmer September in a focus
Slide 8: Each segment contributed to the record third quarter performance
Brunswick Corporation – Earnings Release Each segment contributed to the record third quarter performance PAR T S & B O AT S & B U S I N E S S PROPULSION ACCESSORIES A C C E L E R AT I O N • Share gains continue • Sales increases driven by Navico, • 1 Adjusted operating margins of 10.2% ➢ U.S. outbo
Slide 9: Mix By Region and Q3 Revenue Growth Rates
Brunswick Corporation – Earnings Release Mix By Region1 and Q3 Revenue Growth Rates Canada Europe Growth +12% Growth +15% ✓ All regions Mix: 7% Mix: 12% experienced strong sales growth Asia- Pacific ✓ Both domestic and U.S. Growth +4% Mix: 6% international sales Growth +13% grew 13 percent on a Mix:
Slide 10: U.S. Main Powerboat Industry – Percentage Change in Retail Units
Brunswick Corporation – Earnings Release U.S. Main Powerboat Industry – Percentage Change in Retail Units MAIN POWERBOAT OUTBOARD ENGINES ✓ Q3 2022 main SEGMENT 2022 VS. (NMMA) YTD 2022 VS. powerboat industry retail down 5% vs. Q3 10% 2021 2% ✓ YTD 2022 outboard engine industry retail up -5% -7% 2%
Slide 11: Financial Overview
FINANCIAL OVERVIEW Ryan Gwillim – CFO | 11 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 12: Overview of Third Quarter 2022 Adjusted Results
Brunswick Corporation – Earnings Release Overview of Third Quarter 2022 Adjusted Results1 NET SALES ($m) OPERATING EARNINGS1 ($m) $1,698 $279 ✓ Delivered record $1,427 +19% $221 +26% revenue, operating $977 $136 earnings and EPS for any third quarter in Brunswick history 2019 2021 2022 2019 2021 202
Slide 13: Overview of YTD 2022 Adjusted Results
Brunswick Corporation – Earnings Release Overview of YTD 2022 Adjusted Results1 NET SALES ($m) OPERATING EARNINGS1 ($m) $5,230 $847 $731 $4,415 +18% +16% ✓ Exceptional YTD $3,192 $440 results despite unfavorable FX, enduring supply 2019 2021 2022 chain challenges, 2019 2021 2022 and macro- OPERATING
Slide 14: Propulsion Segment – Q3 '22 Performance
Brunswick Corporation – Earnings Release Propulsion Segment – Q3 ’22 Performance % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Outboard Engines $565 16% 85% Sterndrive Engines $52 (1)% 46% Controls, Rigging and Propellers $97 10% 74% New image Total $714 14% 80% OPERATING MARGIN OPERATING EARNIN
Slide 15: Parts & Accessories Segment – Q3 '22 Performance
Brunswick Corporation – Earnings Release Parts & Accessories Segment – Q3 ’22 Performance1 % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Engine Parts and Accessories $152 2% 29% Distribution $208 (4)% 33% Navico Group2 $228 77% 133% Total $588 19% 58% OPERATING MARGIN OPERATING EARNINGS • Adjust
Slide 16: Boat Segment – Q3 '22 Performance
Brunswick Corporation – Earnings Release Boat Segment – Q3 ’22 Performance1 % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Aluminum Freshwater $208 24% 98% Recreational Fiberglass $181 33% 86% Saltwater Fishing $87 Flat 29% Business Acceleration $39 148% NM Total $5112 27% 84% OPERATING MARGIN OP
Slide 17: Pipeline Metrics
Brunswick Corporation – Earnings Release Pipeline Metrics UNITS IN PIPELINE – END OF Q3 2022 Global Pipelines U.S. Pipelines -39% 20K -45% 12K 13K 7K 7K 4K 2019 2021 2022 2019 2021 2022 WOH 30 10 19 WOH 28 8 16 Q3 2022 pipeline levels 39% below 2019 levels; even lower inventory in U.S. | 17 ©2022 Br
Slide 18: Pipeline Metrics
Brunswick Corporation – Earnings Release Pipeline Metrics UNITS IN U.S. PIPELINE – END OF Q3 2022 Aluminum Pipeline Fiberglass Pipeline -39% 9K -58% 5K 3K 4K 1K 2K 2019 2021 2022 2019 2021 2022 WOH 28 9 19 WOH 27 5 11 Fiberglass pipeline is 58% down from Q3 2019, with aluminum trending healthier | 1
Slide 19: Guidance
Brunswick Corporation – Earnings Release 1 Guidance FY’22 EPS GUIDANCE Full Year 2022 Prior Guidance Midpoint % Change vs. Guidance 2021 approximately: January 2022 $9.93 20% ✓ Revenue $6.9B July 2022 $10.15 23% ✓ EPS $10.00 Current Guidance ~$10.00 21% Quarter 4 Guidance Full Year EPS Drivers: ▪ Fo
Slide 20: Updated 2022 Full Year Assumptions
Brunswick Corporation – Earnings Release Updated 2022 Full Year Assumptions 1 Share ~$450 MILLION Foreign Currency ~$45 – $50 MILLION Repurchases Prev: ~$400M Earnings Headwind Prev: ~$35 - $40M Average Diluted ~75 MILLION Free Cash Flow ~$250 MILLION Shares Outstanding Prev: ~75.0 - 75.5M Prev: >$3
Slide 21: Wrap-Up
WRAP-UP Dave Foulkes – CEO | 21 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 22: An Award-Winning Quarter for the Company
Brunswick Corporation – Earnings Release An Award-Winning Quarter for the Company Aine Denari Named Mover & Shaker of the Year Trade Only Most Forbes World’s Best Innovative Marine Employers r d Company of the Year (3 Consecutive Year) ( 3 rd T i m e i n L a s t 4 Y e a r s ) Brunswick has received
Slide 23: New Products, Technology, and Expansion
Brunswick Corporation – Earnings Release New Products, Technology, and Expansion DISTRIBUTION FATHOM 2 SLX 260 CONTINUED H20 CENTER E-POWER SYSTEM SURF EUROPEAN EXPANSION | 23 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 24: Brunswick Investor Experience Day – ACES New Product
BRUNSWICK I N V E S T O R P R O D U C T E X P E R I E N C E D AY LAKE X - NOVEMBER 16, 2022 20 Brunswick boats on ACES All elements of Autonomy, NEW Product launch and the water Connectivity, Electrification and first-look of future Shared Access on display technologies | 24 For more information con
Slide 25: Thank You + Q&As
THANK YOU + Q&As | 25 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 26: Appendix
Appendix | 26
Slide 27: Updated Assumptions and Guidance for 2022
Brunswick Corporation – Earnings Release Updated Assumptions and Guidance for 2022* 1 2 3 4 5 Revenue Operating Operating EPS Free Cash Flow ~$6.9B margin Flat to 20 expenses as approximately OF ~$250 BPS Increase a % of sales $10.00 MILLION of Flat to 20 BPS 18% Increase 21% Prev: $6.9 - $7.1B Prev
Slide 28: 2022 Updated Outlook – Segment Guidance
Brunswick Corporation – Earnings Release 2022 Updated Outlook – Segment Guidance Parts & Propulsion Accessories Boat NET SALES UP MID-TEENS UP MID-HIGH TEENS UP LOW-TWENTIES GROWTH PERCENT PERCENT PERCENT Prev: +Mid-High Prev: +Low-Mid No Change Teens % Twenties % O P E R AT I N G UP 50-80 BPS DOWN
Slide 29: 2022 Updated Outlook – P&L and Cash Flow Assumptions
Brunswick Corporation – Earnings Release 2022 Updated Outlook – P&L and Cash Flow Assumptions Working ~$250 MILLION Capital Usage Prev: ~$170- Effective Book APPROXIMATELY $200M Tax Rate 22% No Change Tariff Earnings ~$50 MILLION Impact (net) No change Effective Cash HIGH-TEENS Tax Rate PERCENT Depr
Slide 30: 2022 Updated Outlook – Capital Strategy and Other Assumptions
Brunswick Corporation – Earnings Release 2022 Updated Outlook – Capital Strategy and Other Assumptions Capital ~$375 – $400 MILLION Share ~$450 MILLION Expenditures ~$375-$425M Repurchases Prev: ~$400M Quarterly $0.365 PER SHARE Debt $57 MILLION Dividends No Change Retirement No Change Combined Equi
Slide 31: GAAP to Non-GAAP Reconciliations – Q3
Brunswick Corporation – Earnings Release GAAP to Non-GAAP Reconciliations – Q3 Operating Earnings Diluted Earnings per Share (in millions, except per share data) Q3 2022 Q3 2021 Q3 2022 Q3 2021 GAAP $237.7 $209.0 $2.26 $1.85 Restructuring, exit and impairment charges 24.6 — 0.24 — Purchase accountin
Slide 32: GAAP to Non-GAAP Reconciliations – YTD
Brunswick Corporation – Earnings Release GAAP to Non-GAAP Reconciliations – YTD Operating Earnings Diluted Earnings per Share (in millions, except per share data) YTD 2022 YTD 2021 YTD 2022 YTD 2021 GAAP $756.2 $691.1 $7.12 $6.28 Restructuring, exit and impairment charges 24.6 0.7 0.25 0.01 Purchase
Slide 33: Q3 Net Sales increased by $271.0 million
Brunswick Corporation – Earnings Release Q3 Net Sales increased by $271.0 million, or 19 percent Segments Q3 2022 Q3 2021 % Change Propulsion $714.4 $626.9 14% Parts & Accessories 587.8 494.0 19% Boat 510.7 401.5 27% Segment Eliminations (114.7) (95.2) Total $1,698.2 $1,427.2 19% Q3 2022 Constant Cu
Slide 34: YTD Net Sales increased by $814.3 million
Brunswick Corporation – Earnings Release YTD Net Sales increased by $814.3 million, or 18 percent Segments YTD 2022 YTD 2021 % Change Propulsion $2,154.5 $1,934.2 11% Parts & Accessories 1,857.1 1,502.5 24% Boat 1,571.9 1,270.1 24% Segment Eliminations (354.0) (291.6) Total $5,229.5 $4,415.2 18% YTD
Slide 35: Q3 '22 Effective Tax Rate at ~22%
Brunswick Corporation – Earnings Release Q3 ’22 Effective Tax Rate at ~22% Q3 2022 Q3 2021 Effective Tax Rate - GAAP 21.7% 21.2% 1 Effective Tax Rate - As Adjusted 22.2% 20.5% YTD 2022 YTD 2021 Effective Tax Rate - GAAP 21.6% 22.3% 1 Effective Tax Rate - As Adjusted 21.9% 21.4% 1Tax provision, as ad
Slide 36: Free Cash Flow - YTD
Brunswick Corporation – Earnings Release Free Cash Flow - YTD (in millions) YTD 2022 YTD 2021 Net cash provided by operating activities from $313.8 $475.1 continuing operations Net cash (used for) provided by: Capital expenditures (299.3) (180.2) Proceeds from sale of property, plant, equipment 5.7