Chart Industries, Inc. · NYSE:GTLS
Chart Industries — FY2020 Earnings Presentation
30 slides from Chart Industries's earnings presentation, Feb 18, 2021
Slide 1: Fourth Quarter and Full Year 2020 Results
Chart Industries FOURTH QUARTER AND FULL YEAR 2020 RESULTS Exhibit 99.2
Slide 2: Forward-Looking Statements
Forward-Looking Statements CERTAIN STATEMENTS MADE IN THIS PRESENTATION ARE FORW ARD -LOOKING STATEMENTS W ITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. FORW ARD-LOOKING STATEMENTS INCLUDE STATEMENTS CONCERNING THE COMPANY’S BUSINESS PLANS, INCLUDING STATEMENTS REGARDING
Slide 3: External Segmentation
External Segmentation 3 Cryo Tank Solu t ions Heat Transfer Sys tems • Air Cooled Heat Exchangers (ACHX), • Brazed Aluminum Heat Exchangers (BAHX) • Cold Boxes • Nitrogen Rejection Units (NRU) • Integrated systems • High Efficiency Flow Fans • Bulk and Micro Bulk Storage Tanks • ISO Containers • Pac
Slide 4: Chart's Transformation
Chart’s Transformation 4 Before 2018 THEN 2021 TODAY High customer concentration & low geographic diversity Heavy reliance on single large LNG projects Few long-term contracts in place Limited to no aftermarket, service and repair Disparate cost structures / silos High end-market (specia
Slide 5: Chart's Strategic Investment / Partnering Approach
Chart’s Strategic Investment / Partnering Approach 2020 Development Agreement for LH2 automotive Completed master supply agreement Acquisition of cryogenic and H2 trailer business and former microbulk business 30M Euro investment with commercial MOU Acquisition of water treatment business Investment
Slide 6: 2020 Chart Industries Investor Day
2020 Chart Industries Investor Day 6
Slide 7: Full Year 2020 Records
Full Year 2020 Records 7 Total Chart Records: • New customers (472) • Long-term agreements executed (33) • 53 new leases signed (vs. 18 in 2019) • Adjusted earnings per share ($2.73) • Lowest total SG&A as a % of sales (15.1% reported; 14.3% normalized) • Operating income as a percent of sales (10.9
Slide 8: Strong Q4 and Second Half 2020 Orders and Margin
Strong Q4 and Second Half 2020 Orders and Margin 8 Q4 2020 / Year-End 2020 Records: • Other Record Q4 2020 Orders • HLNG vehicle tanks (Specialty) • Hydrogen (Specialty) • Food & beverage (Specialty) • Engineered systems (CTS) • Mobile equipment (CTS) • Medical oxygen equipment (CTS) • VRV (HTS) • A
Slide 9: Our Specialty Markets Keep Growing
Our Specialty Markets Keep Growing 700M 750M 2,100M Space ▪ Cryogenic liquid propellants are used as fuel for rocket propulsion Drivers of Size Opportunity ▪ Proliferation of private space travel industry Industrial Lasers ▪ High purity liquid nitrogen (gas assist) provides a faster cut and superior
Slide 10: Specialty Products
$275 $279 FY19 FY20 1% 10 Specialty Products Orders Sales Gross Margin $55 $85 Q4 2019 Q4 2020 $208 $243 FY19 FY20 30.9% 31.1% Q4 2019 Q4 2020 34.7% 34.7% FY19 FY20 17% $90 $94 Q4 2019 Q4 2020 4% 55% +13 bps+1 bps Fourth Quarter 2020 versus 2019: • Q4 2019 included $22 million order for LNG by rail
Slide 11: Hydrogen NPD: Production Ready in 2021
Hydrogen NPD: Production Ready in 2021 11 Liquid Hydrogen Onboard Vehicle Tank being tested at our Canton, Georgia (USA) facility Hydrogen Test Facility in New Prague, Minnesota (USA) includes a liquid hydrogen bulk tank, a LH2 run tank, pumps and other related components for testing and a fully ins
Slide 12: Q4 2020 First of a Kinds & New Customer Examples
Q4 2020 First of a Kinds (FOAKs) & New Customer Examples 12 Squeezable DipsNitro Beer Water desalination “Just Egg” bottled egg alternative Ophthalmic research Canned wine Partnering with Pepsi to upgrade their CO2 capacity at one of Pepsi’s USA facilities (Q4 2020 order) Chart and O2 are collaborat
Slide 13: Repair, Service & Leasing
$41 $41 Q4 2019 Q4 2020 13 Repair, Service & Leasing Orders Sales Gross Margin $44 $54 Q4 2019 Q4 2020 $163 $158 FY19 FY20 33% 44% Q4 2019 Q4 2020 33% 35% FY19 FY20 $166 $197 FY19 FY20 19% 23% -3% +133 bps +1052 bps Fourth Quarter 2020: • All new portable trailers completed in Q4 2020 had signed lea
Slide 14: Cryo Tank Solutions
14 Cryo Tank Solutions Orders Sales Gross Margin $103 $132 Q4 2019 Q4 2020 $410 $416 FY19 FY20 16.1% 21.6% Q4 2019 Q4 2020 18.8% 23.9% FY19 FY20 $409 $418 FY19 FY20 2% 28% $109 $111 Q4 2019 Q4 2020 1% +507 bps 2% +550 bps Fourth Quarter 2020: • Highest medical oxygen order quarter of 2020 • Year end
Slide 15: Heat Transfer Systems
22.8% 24.8% Q4 2019 Q4 2020 $84 $140 Q4 2019 Q4 2020 15 Heat Transfer Systems Orders Sales Gross Margin $477 $331 FY19 FY20 $120 $79 Q4 2019 Q4 2020 $442 $370 FY19 FY20 21.3% 25.4% FY19 FY20 -31% -16% +404 bps +201 bps 67% -34% Fourth Quarter 2020: • $70M air cooled heat exchanger order for downstre
Slide 16: LNG Remains a Significant Opportunity for GTLS
LNG Remains a Significant Opportunity for GTLS 16 • LNG Cargoes rebounded sharply from fall cancellations • Transit issues through Panama Canal, global demand pushing day rates from ~60K/d to ~300+ K/d • LNG supply disruptions (GC Hurricanes, Hammerfest, Gorgon, Qatar) coupled with cold winters in E
Slide 17: Q4 and Full Year 2020 EPS
© 2021 Chart Industries, Inc. Confidential and Proprietary 17 Q4 and Full Year 2020 EPS (1) Other one-time items were related to: Stabilis investment mark-to-market and Liberty LNG investment adjustment of $0.07 in Q4 2019, $0.15 in Q1, ($0.02) in Q2,and ($0.01) in Q3 and Q4 2020; COVID-19 related c
Slide 18: Q4 and Full Year 2020 Financial Summary
© 2021 Chart Industries, Inc. Confidential and Proprietary 18 Q4 and Full Year 2020 Financial Summary Full Year 2020 Vs. 2019 Q4 2020 Vs. Q4 2019 FY20 Q4 FY19 Q4 Change % Net Sales $312 $321 -3% Operating Margin % 12% 5% 750 bps Adjusted Operating Margin % 13% 8% 510 bps Diluted EPS $1.28 $0.46 178%
Slide 19: December 31, 2020 Net Leverage Ratio
December 31, 2020 Net Leverage Ratio 19© 2021 Chart Industries, Inc. Confidential and Proprietary Q4 2002 Free Cash Flow (FCF) of $49.6 million, including $10.6 million of capital expenditures FY 2020 Free cash Flow (FCF) of $134.8 million, including $37.9 million of capital expenditures 1.59 1.65 1
Slide 20: 2020 Actual Sales to 2021 Sales (to Low End of Range)
2020 Actual Sales to 2021 Sales (to Low End of Range) © 2021 Chart Industries, Inc. Confidential and Proprietary 20 (A) VG Calacasieu Pass ~$98 million in 2020, $21 million in 2021 forecast (B) Expect two small-scale LNG projects to move to notice to proceed in 2021, resulting in a portion of revenu
Slide 21: Full Year 2021 Guidance
Full Year 2021 Guidance (Continuing Operations) 21© 2021 Chart Industries, Inc. Confidential and Proprietary Revenue $1.26B to $1.335B Includes $23M of Calcasieu Pass Diluted Adjusted EPS $3.10 to $3.45 Assumes 18% ETR & 35.3M shares outstanding Capital Expenditures $32M to $37M Prior Guidance Curre
Slide 22: In 2020, Chart Industries' Products Helped
In 2020, Chart Industries’ Products Helped: © 2021 Chart Industries, Inc. Confidential and Proprietary 22 Treat over 2 billion gallons of water a day in the US Produce about 50 million tons of LNG to replace coal fired power generation (non-US) Reduce over 500 million liters of diesel used by over-t
Slide 23: Appendix
Appendix 23
Slide 24: Q4 and Full Year 2020 Free Cash Flow
© 2021 Chart Industries, Inc. Confidential and Proprietary 24 Q4 and Full Year 2020 Free Cash Flow (1) “Net income, adjusted” is not a measure of financial performance under U.S. GAAP and should not be considered as an alternative to net income in accordance with U.S. GAAP. Reconciliation to Net Inc
Slide 25: Re-segmented Financial Summary, As Reported (1/2)
© 2021 Chart Industries, Inc. Confidential and Proprietary 25 Re-segmented Financial Summary, As Reported (1/2) Cryo Tank Solutions $M Sales 98.6 103.0 99.7 108.6 409.9 98.0 105.3 102.0 110.5 415.8 Gross Profit 17.0 20.2 22.5 17.5 77.2 24.0 25.9 25.6 24.0 99.5 Gross Profit Margin 17.2% 19.6% 22.6% 1
Slide 26: Re-segmented Financial Summary, As Reported (2/2)
© 2021 Chart Industries, Inc. Confidential and Proprietary 26 Re-segmented Financial Summary, As Reported (2/2) Repair, Service & Leasing $M Sales 35.9 40.7 45.2 40.8 162.6 40.7 40.1 36.5 41.0 158.3 Gross Profit 8.2 17.2 15.0 13.6 54.0 11.8 13.7 11.2 17.9 54.6 Gross Profit Margin 22.8% 42.3% 33.2% 3
Slide 27: Re-segmented Financial Summary, Adjusted (1/2)
© 2021 Chart Industries, Inc. Confidential and Proprietary 27 Re-segmented Financial Summary, Adjusted (1/2) Cryo Tank Solutions $M, adjusted Sales 98.6 103.0 99.7 108.6 409.9 98.0 105.3 102.0 110.5 415.8 Gross Profit 22.0 25.8 24.1 20.0 91.9 24.1 26.1 25.6 24.7 100.5 Gross Profit Margin 22.3% 25.0%
Slide 28: Re-segmented Financial Summary, Adjusted (2/2)
© 2021 Chart Industries, Inc. Confidential and Proprietary 28 Re-segmented Financial Summary, Adjusted (2/2) Repair, Service & Leasing $M, adjusted Sales 35.9 40.7 45.2 40.8 162.6 40.7 40.1 36.5 41.0 158.3 Gross Profit 10.6 15.6 15.0 13.6 54.8 12.5 14.2 11.7 18.4 56.8 Gross Profit Margin 29.5% 38.3%
Slide 29: Appendix A: Reconciliation to Adjusted Financial Summary
© 2021 Chart Industries, Inc. Confidential and Proprietary 29 Appendix A: Reconciliation to Adjusted Financial Summary Cryo Tank Solutions $M Restructuring and transaction-related 5.0 5.6 0.3 0.0 10.9 0.1 0.1 0.1 0.0 0.3 Other one-time costs 0.0 0.0 1.3 2.5 3.8 0.0 0.1 -0.1 0.7 0.7 Gross Margin 5.0
Slide 30: Appendix B: Reconciliation to Global Commercial Sales SG&A
© 2021 Chart Industries, Inc. Confidential and Proprietary 30 Appendix B: Reconciliation to Global Commercial Sales SG&A SG&A, as reported $M Cryo Tank Solutions 12.6 10.7 11.9 10.7 45.9 11.1 8.5 10.5 11.6 41.7 Heat Transfer Systems 12.5 13.2 13.0 12.7 51.4 11.2 10.0 7.2 8.2 36.6 Specialty Products