Columbus Mckinnon Corporation · NASDAQ:CMCO
Columbus Mckinnon — Investor Presentation (August 2022)
35 slides from Columbus Mckinnon's investor presentation, Aug 23, 2022
Slide 1: Investor Presentation
Investor Presentation Executive Vice President – Finance and Chief Financial Officer Gregory P. Rustowicz President and Chief Executive Officer David J. Wilson August 2022
Slide 2: Safe Harbor Statement
© 2022 COLUMBUS MCKINNON CORPORATION These slides, and the accompanying oral discussion (together, this “presentation”), contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements concer
Slide 3: Intelligent Motion Solutions for Material Handling
© 2022 COLUMBUS MCKINNON CORPORATION 3 Intelligent Motion Solutions for Material Handling Seasoned Leader With Extensive History Of Safely, Efficiently And Ergonomically Moving Materials (1) Market data as of 8/17/2022 (Source: S&P Capital IQ); Financial data represents TTM ended June 30, 2022 (2) P
Slide 4: Global Leader In Intelligent Motion Solutions For Material Handling
© 2022 COLUMBUS MCKINNON CORPORATION 4 Lifting Solutions: #1 U.S. market position in hoists Lifting capacity from 1/8 ton to ~140 tons Manual chain, electric chain and wire rope hoists Reliable, high-quality products Compass™ configure, price and quote tool Linear Motion Solutions: Specialty Actuati
Slide 5: Conveying Solutions: A Scalable, High-Growth Platform
© 2022 COLUMBUS MCKINNON CORPORATION 5 Specialty conveying provides growth platform: ~$4B TAM growing at 6% to 8% CAGR Higher margin profile Strong secular growth drivers: Supply chain automation Acceleration of e-commerce adoption Fragmented market provides target rich acquisition environment Acqui
Slide 6: Unlocking CMCO's Potential
© 2022 COLUMBUS MCKINNON CORPORATION 6 Unlocking CMCO’s Potential Business System and Core Growth Framework to Transform CMCO Framework To Deliver Differentiated Growth, Financial Performance And Shareholder Value GROWTH FRAMEWORKCMBS TRANSFORMATION
Slide 7: Business Model Transformation
© 2022 COLUMBUS MCKINNON CORPORATION 7 Business Model Transformation Growth Strategy Substantially Advances Underlying Portfolio Targeting $1.5 Billion In Revenue In Fiscal 2027 And ~21% EBITDA Margin Revenue Growth Rate EBITDA Margin Lifting Solutions 61% Specialty Conveying 16% Linear Motion 10% A
Slide 8: Targeting Top-tier Performance Over The Strategic Planning Period
© 2022 COLUMBUS MCKINNON CORPORATION Targeting Top-tier Performance Over The Strategic Planning Period Increases digital capabilities with technology enablers that support growth and cost optimization Incorporates factory simplification to drive earnings power Elevates competitive advantage via depl
Slide 9: CMBS to Deliver Margin Expansion
© 2022 COLUMBUS MCKINNON CORPORATION 9 CMBS to Deliver Margin Expansion 80/20 Critical Business Tool Created More Than $45 Million Of Incremental OI Beginning In FY19… More Opportunities To Pursue Product SKUs Down to ~22,000* from ~50,000 in 2019 Surpassed goal of 26,000 Purchased parts Reduced by
Slide 10: Secular Growth Markets Provide Strong Tailwinds
© 2022 COLUMBUS MCKINNON CORPORATION 10 Secular Growth Markets Provide Strong Tailwinds New platform adds attractive vertical markets with enduring tailwinds Strategy Aligned With Significant Megatrends That Are Driving High-Single-Digit Growth Trends Life Sciences / Pharma E-Commerce Custom designe
Slide 11: Driving Organic Growth with New Products
© 2022 COLUMBUS MCKINNON CORPORATION 11 Driving Organic Growth with New Products Improved Customer Experience, Safety and Productivity At The Core Of New Product Development • Improved facility safety for large complex loads • Available in Compass™ configurator Linear Actuator with Intelli-Motion™ P
Slide 12: Driving Innovation Through Automation
© 2022 COLUMBUS MCKINNON CORPORATION 12 Driving Innovation Through Automation Intelli-Crane™ Solutions Creating Competitive Advantages With Pre-Engineered Automation Solutions • Protection boundaries for improved facility safety • Full configuration to exact requirements • Visible and audible warnin
Slide 13: Strong Track Record Creating Value Through M&A
© 2022 COLUMBUS MCKINNON CORPORATION 13 Strong Track Record Creating Value Through M&A Transforming Columbus McKinnon Into A Top-Tier, Higher Growth, Higher Margin Enterprise January 2017 Acquisition of STAHL CraneSystems from Konecranes for ~$218M strengthens leading global position in lifting solu
Slide 14: FY2027 Financial Targets
© 2022 COLUMBUS MCKINNON CORPORATION Reducing RSG&A as a Percent of Sales to ~20%* • Reorganization to optimize management and commercial structure • ERP implementations enable shared service model • Additional investments in digital enablement (i.e. HRIS, CRM, CPQ, SIOP) • Improved leverage and sca
Slide 15: Financial Targets
© 2022 COLUMBUS MCKINNON CORPORATION 15 Financial Targets Execution of Strategy Delivers Attractive Financial Results $115 $132 $127 $77 $140 $235 $80 ~$315 13.7% 15.1% 15.7% 11.9% 15.4% ~21% -2.0% 3.0% 8.0% 13.0% 18.0% 23.0% 28.0% -50 50 150 250 350 450 550 FY18 FY19 FY20 FY21 FY22 FY27E ADJUSTED E
Slide 16: Revenue Bridge
© 2022 COLUMBUS MCKINNON CORPORATION 16 Revenue Bridge Strategy Expected to Deliver >10% Revenue Growth REVENUE FY22 TO FY27E ($ in millions)
Slide 17: Adjusted EBITDA Margin Bridge
© 2022 COLUMBUS MCKINNON CORPORATION 17 Adjusted EBITDA Margin Bridge Expanding Adjusted EBITDA Margins ~550 bps Driven by Cost Actions & Scale ~21% ADJUSTED EBITDA MARGIN FY22 to FY27E $309M Backlog at 3/31/22 Pricing & Freight Recovery Actions In Process ~19% ($ in millions)
Slide 18: Capital Allocation Priorities
© 2022 COLUMBUS MCKINNON CORPORATION D e c re a s in g P ri o ri ty Acquisitions New product development and CapEx De-lever the balance sheet Regular/Special dividend Share repurchase Capital Allocation Priorities Disciplined Approach to Capital Allocation Prioritizing Growth and Returns Fund pensio
Slide 19: Free Cash Flow and Net Leverage
© 2022 COLUMBUS MCKINNON CORPORATION 19 Free Cash Flow and Net Leverage Strong Cash Generation Funds Strategic Investments 46 55 67 97 87 36 160 513% 250% 158% 163% 951% 121% 98% -1200% -700% -200% 300% 800% 0 50 100 150 200 FY17 FY18 FY19 FY20 FY21 FY22 FY27E FREE CASH FLOW GENERATION / CONVERSION(
Slide 20: CMCO Peer Group Comparison
© 2022 COLUMBUS MCKINNON CORPORATION 22.8% 36.1% 33.3% ADJ. GROSS MARGIN(1) 7.8x 9.3x 11.3x EBITDA TRADING MULTIPLE(2) 16.3% 39.5% 22.4% Legacy Industrial CMCO Motion Control YOY SALES GROWTH LEGACY INDUSTRIAL PEERS MOTION CONTROL PEERS 10.3% 15.4% 18.8% ADJ. EBITDA MARGIN CMCO Peer Group Comparison
Slide 21: Strong Demand Across Markets
© 2022 COLUMBUS MCKINNON CORPORATION 21 Strong Demand Across Markets Continued strength throughout breadth of industries served Strong Book-to-Bill Ratio Supports Continued Future Growth Continued Strength in Orders Record backlog of $351.6 million • Up 7%; 11% on constant currency basis with double
Slide 22: Record Backlog and Strong Pricing Drives Sales
© 2022 COLUMBUS MCKINNON CORPORATION 22 Record Backlog and Strong Pricing Drives Sales Driving Towards $1 Billion In Annual Revenue NET SALES $213.5 $223.6 $216.1 $253.4 $220.3 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 Q1 FY23 $649.6 $906.6 $913.4 FY21 FY22 Q1 FY23 TTM ($ in millions) (1) Only Garvey acquisit
Slide 23: Capital Structure
© 2022 COLUMBUS MCKINNON CORPORATION 23 Capital Structure Flexible Capital Structure and Solid Balance Sheet Supports Strategy in All Market Conditions Pro-forma net debt leverage ratio of ~2.9x(1) • Net debt to net total capital: 34.9% Reduced debt $10 million in the quarter Expect to pay down $40
Slide 24: Outlook and Perspective
© 2022 COLUMBUS MCKINNON CORPORATION 24 Outlook and Perspective Creating A Scalable Enterprise With Stronger Earnings Power Q2 FY2023 outlook • Expect Q2 FY23 net sales of approximately $230 million to $240 million,(1) up mid-to-high single digits sequentially • Executing plan and addressing supply
Slide 25: Key Takeaways
© 2022 COLUMBUS MCKINNON CORPORATION 25 Key Takeaways Transforming to a Top-tier, Secular Growth, Intelligent Motion Solutions Enterprise Growth Strategy Is Underpinned By CMBS Enabling Scalability And Operational Excellence EVOLVED STRATEGY BLUEPRINT FOR GROWTH 2.0 DEFINES GROWTH FRAMEWORK COLUMBUS
Slide 26: Investor Presentation
Investor Presentation Executive Vice President – Finance and Chief Financial Officer Gregory P. Rustowicz President and Chief Executive Officer David J. Wilson August 2022
Slide 27: Supplemental Information
OND Supplemental Information INTELLIGENT MOTION PURPOSE IN MOTION
Slide 28: Corporate Sustainability Report
© 2022 COLUMBUS MCKINNON CORPORATION 28 Corporate Sustainability Report Together We Create Intelligent Motion Solutions That Move The World Forward And Improve Lives Strategic Initiatives • Five-year plan – based on baselines, gap analysis & target setting • Tightly aligned with business strategy •
Slide 29: Capacity Utilization
© 2022 COLUMBUS MCKINNON CORPORATION 29 U.S. Capacity Utilization Industrial Capacity Utilization Eurozone Capacity Utilization Source: The Federal Reserve Board Source: European Commission 60% 65% 70% 75% 80% Manufacturing Total 79.8% (Manufacturing) 80.3% (Total) July 2022(1) 65% 67% 69% 71% 73% 7
Slide 30: ISM Production Index
© 2022 COLUMBUS MCKINNON CORPORATION Source: Institute for Supply Chain Management ISM Production Index 30 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 53.5% July 2022
Slide 31: Adjusted Gross Profit Reconciliation
© 2022 COLUMBUS MCKINNON CORPORATION 31 Adjusted Gross Profit Reconciliation Adjusted gross profit is defined as gross profit as reported, adjusted for certain items. Adjusted gross profit is not a measure determined in accordance with generally accepted accounting principles in the United States, c
Slide 32: Adjusted Net Income and Diluted EPS Reconciliation
© 2022 COLUMBUS MCKINNON CORPORATION Adjusted net income and diluted EPS are defined as GAAP net income/(loss) and diluted EPS as reported, adjusted for certain items, including amortization of intangible assets, and also adjusted for a normalized tax rate. Adjusted net income and diluted EPS are no
Slide 33: Adjusted EBITDA Reconciliation
© 2022 COLUMBUS MCKINNON CORPORATION Adjusted EBITDA is defined as net income before interest expense, income taxes, depreciation, amortization, and other adjustments. Adjusted EBITDA is not a measure determined in accordance with generally accepted accounting principles in the United States, common
Slide 34: Adjusted EBITDA Reconciliation
© 2022 COLUMBUS MCKINNON CORPORATION 34 Adjusted EBITDA Reconciliation ($ in thousands) Fiscal Year TTM 2018 2019 2020 2021 2022 Q1 FY23 GAAP net income (loss) $ 22,065 $ 42,577 $ 59,672 $ 9,106 $ 29,660 $ 45,314 Add back (deduct): Income tax expense (benefit) 27,620 10,321 17,484 970 8,786 20,196 I
Slide 35: Free Cash Flow Reconciliation
© 2022 COLUMBUS MCKINNON CORPORATION NM: Not meaningful Free cash flow is defined as cash from operations minus capital expenditures. Free cash flow conversion is defined as free cash flow divided by net income. Free cash flow and free cash flow conversion are not measures determined in accordance w
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