Enerpac Tool Group Corp. · NYSE:EPAC
Enerpac Tool — Q1 2023 Earnings Presentation
21 slides from Enerpac Tool's earnings presentation, Dec 21, 2022
Slide 1: Fiscal 2023 First Quarter Earnings
Fiscal 2023 First Quarter Earnings December 21, 2022 1
Slide 2: Forward-Looking Statements/Non-GAAP Measures
Forward-Looking Statements/Non-GAAP Measures Statements made in this presentation that are not historical are forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. The terms “may,” “should, ”“could,” “anticipate,” “believe,” “estimate,” “
Slide 3: Investor Day Recap
New Team New Mission RAISING New Plan THE BAR New Goals
Slide 4: Investor Day Recap
Investor Day Recap 4 *Based on FY22 FX Adjusted Revenue of $550M
Slide 5: Strategy Update – ASCEND Progress
Strategy Update – ASCEND Progress Initiatives Key Actions Commercial Through our channel simplification strategy, refocusing our efforts on and disproportionately investing behind those partners that are focused on helping to grow the Enerpac business and best positioned to win in the marketplace
Slide 6: Market Update
Market Update Overview ▪ Solid top line performance, despite currency headwinds, driven by strong customer demand ▪ While some distributors are cautious, we do not see signs of a recession ▪ Continued to manage supply chain challenges, with a slight decrease in past due backlog quarter over quarter
Slide 7: Regional Update
Regional Update Americas ▪ Another quarter of solid year-over-year core growth in the Americas ▪ Key Verticals ▪ Rail was favorable due to investments in ongoing rolling stock maintenance ▪ Wind is creating some nice future opportunities for HLT business ▪ Aero experienced steady demand with a nice
Slide 8: Regional Update
Regional Update Asia Pacific ▪ Slight year-over-year core growth ▪ COVID continued to be a challenge in China ▪ Key Verticals ▪ Mining continued to be positive due to demand for iron ore, coal, and some precious materials ▪ Shipbuilding activity largely driven by the transportation of liquefied natu
Slide 9: First Quarter 2023 Comparable Results
First Quarter 2023 Comparable Results (US$ in millions except EPS) $152 $139 NET SALES* $131 20.1% 19.1% • Core sales growth of 13% • IT&S product sales 14% 13.4% • Other product 26% • Service 3% • Unfavorable impact of FX ~$7M, reducing core sales by 6% Q1 2022 Q4 2022 Q1 2023 Q1 2022 Q4 2022 Q1 20
Slide 10: Net Sales Waterfall
Net Sales Waterfall* (US$ in millions) $145 $140 $0.9 Product volume $7.8 $139.3 driven by solid $135 demand and product pricing were the primary drivers of the $130 year-over-year net $130.9 $7.1 $6.8 sales increase, offset by FX $125 headwinds $120 $115 Net Sales Q1 FY22 Fx Translation Volume - Pr
Slide 11: IT&S Product Net Sales
IT&S Product Net Sales Due to the combination of increased volume and the benefit of pricing actions, first quarter net sales were well in excess of the peak IT&S product sales the 4 fiscal years prior to COVID and fiscal 2022 11
Slide 12: Adjusted EBITDA Waterfall
Adjusted EBITDA Waterfall* (US$ in millions) $29 $1.3 $1.2 $0.3 $27 Adjusted EBITDA $2.1 primarily $26.6 benefited from $25 product volume $1.5 and product $23 price/cost benefit $3.5 & mix, along with $21 Cortland 12.3% 13.3% mix/productivity $19 $3.1 $17 $1.0 $17.6 $15 EBITDA Q1 Fx Translation Vol
Slide 13: Operations Update
Operations Update Supply Chain Update ▪ Supply chain challenges continued during the quarter but seeing some overall improvement ▪ Past due backlog decreased slightly quarter over quarter ▪ Component availability is still a challenge, particularly for some plastic parts and electronics ▪ Continued t
Slide 14: Liquidity – Positioned for Success
Liquidity – Positioned for Success (US$ in millions) $129 $127 $43 $204 $202 0.9 0.7 0.7 $16 $121 $175 $(8) Q1 2022 Q4 2022 Q1 2023 Q1 2022 Q4 2022 Q1 2023 Q1 2022 Q4 2022 Q1 2023 Q1 2022 Q4 2022 Q1 2023 Free Cash Flow Cash Balance Gross Debt TTM Financial Leverage* Free Cash Flow (FCF) Leverage • $
Slide 15: Fiscal 2023 Guidance – No Change
Fiscal 2023 Guidance – No Change Fiscal 2023 Full Year Guidance: ▪ Net Sales in the range of $565 to $585 million, with core growth of 3%-6% ▪ Projected year-over-year core growth by category We continue to ▪ IT&S Product ~ up mid single digits% be cautious and ▪ IT&S Service ~ down mid single digit
Slide 16: Appendix
Appendix
Slide 17: ASCEND Summary
ASCEND Summary ASCEND Transformation Program ▪ Key Initiatives ▪ Accelerating organic growth go-to-market strategies ▪ Improving operational excellence and production efficiency by utilizing a Lean approach ▪ Driving greater efficiency and productivity in SG&A by better leveraging resources and tech
Slide 18: Adjusted Operating Profit Waterfall
Adjusted Operating Profit Waterfall* (US$ in millions) $26 Adjusted $24 Operating Profit $1.3 $1.1 $0.5 primarily $22 $23.1 benefited from $2.1 product volume $20 and product $1.5 price/cost $18 $3.5 benefit & mix, along with $16 Cortland mix/productivity $3.1 $14 $0.7 $12 $12.9 $10 OP Q1 FY22 Fx Im
Slide 19: First Quarter 2023 GAAP vs Non-GAAP Reconciliation
First Quarter 2023 GAAP vs Non-GAAP Reconciliation (US$ in millions except EPS) Less ASCEND Leadership Debt Restructuring Transformation Transition Issuance GAAP Charges Charges Charges Costs Adjusted Sales $139.4 $139.4 Operating Profit $12.3 ($1.0) ($9.4) ($0.4) $0.0 $23.1 Income Taxes $2.4 ($0.1)
Slide 20: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures (US$ in millions) Adjusted EBITDA Free Cash Flow Q1 Q1 2023 2022 Q1 Q1 Net Earnings $6 $3 0 2023 2022 Net Financing Costs $3 $1 Cash From Operations $ 18 $ (5) Income Taxes $2 $2 Capital Expenditures $ (3) $ (3) Depreciation & Amortization $4 $5 Other $ 2 $ - Rest
Slide 21: Enerpac Tool Group
ENERPAC (7) TOOL GROUP