Ceco Environmental Corp. · NASDAQ:CECO
Ceco Environmental — Needham Growth Conference 2016
28 slides from Ceco Environmental's conference presentation, Jan 13, 2016
Slide 1: Needham Growth Conference
Exhibit 99.1 ENVIRONMENTAL A global industrial technology company focused on Environmental, energy, fluid handling and filtration industries NEEDHAM GROWTH CONFERENCE January 14, 2016
Slide 2: Notes to Investors
NOTES beliefs performance. Forward-looking such factors including infrastructure, investigation; it and Form material looking filings the results gross selected measures. Materials.” orSecurities fluid incur statements. margin, 10-Q. with in and related statements TO measures aspects handling accord
Slide 3: CECO at a Glance
CECO at asset-light engineered increasing Market Cap aregulations business Glance solutions (1): $ 245M Diversified model and driving Dividend technologies • Broad growth global Yield: endprovider in (~75%) market Asia 3.8%• exposure and of Over 2015 leading aftermarket $5BN CECO including engineere
Slide 4: Business Segments
Business power thermal rolling separators eliminator & mills &petrochemical Segments: (nuclear catalytic systems Primary•plant oxidizers Three Custom Technologies industry reactor Core fan • Dust Strategic vessels) Fluid & •laboratory collectors/bag Gas Handling/ •turbine Segments Expansion exhaust
Slide 5: Peerless Acquisition
Peerless Strong $5B, creation providing target for Strengthens shareholders markets cross CECO’s selling • Natural and Energy gas aftermarket turbine Segment power sales • Acquisition generation opportunities completed and• midstream Acquisition Sept.natural 3, integration 2015gas • Adds pipelines a
Slide 6: Midstream Natural Gas Pipeline Opportunity
Midstream by 120M/year construction* discounted Natural • $15-20M/year =20% ~80Gas tocompressor bePipeline conservative. for SCR stations Distribution & emission • Middle • Midstream control East, Asia systems pipeline & Europe: • One energy natural 15,000 sector gas miles expanding compressor plann
Slide 7: CECO Growth Drivers
CECOatGrowth (estimated grow Scientific CAGR Journal, 20 new Drivers of nearly and plants U.S. Natural 5% perEnergy from year) Gas2015 through Information Turbine to 2020 2035 Power Administration Global Global Generation Environmental Oil Refineries • Increased •Technologies With shift newto natura
Slide 8: Growth Drivers: Aftermarket and Pipeline
CECO Growth remains Currently 2015-2020 Pipeline primary and 110 Aftermarket Gas LNG Drivers driver Journal, facilities of Natural Revenue and midstream inEuropean Gas the Growth U.S. Pipelines infrastructure Industrial with Strategy 9• U.S. facilities •Forecasting development Higher natural approve
Slide 9: Growth Drivers: Asia
CECO operations greater utilize rate of synergies $67M Growth success in China; revenue; Drivers &from execution Well recent Goal Strong positioned to •acquisitions Invested obtain CECOfor$100M Asia ingrowth •VP, Devaluation Platform revenue Asia given with • Represents over strong of 25 Chinese yea
Slide 10: Industry Leaders Choose CECO
Industry Leaders Choose CECO Leverage to Large Blue-Chip Customers Well-Diversified Cross-Section of End-Markets No Customer, Year Over Year, Represents More Than 5% of Sales on Average
Slide 11: Expanding Globally
Expanding APC High Increased regulation growth focus Globally emerging on initiatives sales with market vs. Localized (China) manufacturing (refining Latin Sales/America petrochem) & Production • Established Sales Capabilities Agents presence Facilities North & America pursuing / Sales Offices •expa
Slide 12: Key Tenets of CECO Strategy
Key Tenets Industry Operations Aftermarket to of Working CECO Asia Strategy Capital & EMEA Continued & Strategic Average Focus Enhance Growth on Organic Free Opportunities Cash Continued FlowSolid Acquisitions Focus Operating SalesProfitability &Platform on Organic toConversion Drive Continued Futur
Slide 13: The Met-Pro Acquisition Success Story
The CECO integration; Accomplishments streamlined acquisition Met-Pro SG&AIncreased by Acquisition 40% Expect Debt Met-Pro similar Success repayment EBITDA results Story and with from • Acquired working Peerless $13Mcapital Met-Pro to $23M excellence inExited Augustand • Under 2013 soldfor CECO’s un
Slide 14: Met-Pro and Peerless Purchase Multiples
Met-Pro Price x 6.0 x$ Met-Pro 173.0 & Peerless $ 124.0 acquisition Favorable Original demonstrates Multiple EBITDACompression $CECO’s 13.0 $ 0.0 ability Original ($ intomillions) reduce Multiple purchase Met-Pro 13.3 xprice (Actual) N/A multiple Subsequent PeerlessAsset (Projected) Sales $Gross ( 1
Slide 15: Sharp Focus on Debt Reduction
Sharp Focus Growth months and EBITDA on Debt Reduction generation••Net Evaluating Debt to asset Pro Forma sale-lease EBIDTA back =opportunities 2.6x Leverage• Closed Ratio –large $157M older Commitment Texas facility / $60M and shifted proforma manufacturing EBITDA • Core • Retired focus: ~$20M – De
Slide 16: Financial Overview
ENVIRONMENTAL A global industrial technology company focused on Environmental, energy, fluid handling and filtration industries FINANCIAL OVERVIEW
Slide 17: Attractive Financial Model
Attractive cash higher flow margin management Financial revenues Model and • sales •working Extremely initiative capital low to focus excellence CapExon (less organic • Lean thangrowth 1% business ofDelivering revenue) poised via for margin asset accelerating expansion light model growth through • P
Slide 18: Margin Trends
Margin Trends important disclosures ($ Millions) regarding Revenue CECO’s & Gross use ofMargin this non-GAAP (1)(3) Adjusted financial EBITDA measure. & EBITDA (3) TTM Margin 2015 is (1)(2)(3) the twelve(1)months 2010 through ended September 2014 are as 30,reported. 2015. (2) See supplemental slide
Slide 19: Consolidated Results
Consolidated $12,368 important 8.9% disclosures Results $5,036 ($ regarding $0.15 thousands 3.6%CECO’s 2010 except 2011 use perof 2012 share these 2013 data) non-GAAP 2014 Non-GAAP TTMfinancial 2015 Operating 2010 measures. 2011 Income 2012Non-GAAP 2013 2014 Earnings TTM 2015 Per(1) Share See supple
Slide 20: Quarterly Backlog & Bookings
Quarterly Backlog & Bookings ($ in millions) Bookings • Record 3Q15 backlog of $212.3M • Organic bookings flat y/y • 3Q15 bookings of $88.8M vs $69.9M a year ago
Slide 21: Balance Sheet
Balance Total Working Bank Sheet Capital Debt ($ $in0.0 29.9 millions) $$0.0 36.8 $ Selected 89.1 $ 65.5 $ 112.4 $Balance 67.6Shareholders’Equity . Net Sheet Debt Information to Pro Forma $ 12/31/2011 43.0EBITDA $ 62.0 $12/31/2012 =170.4 2.6x Leverage $ 181.2 12/31/2013 Balance Ratio Note: 12/31/201
Slide 22: Cash Conversion
Cash Conversion (654) 116% acquisition (913) -231% and (273) • 5-year integration and (1377) Free average (1151) Cash expense free (876) Flow cash (ie.($ Free deal flow in cash thousands) costs) conversion flow $Annual 1274 of 155% $ Annual 7789 • Low $ Annual 16556 CAPEX, $Annual 22804 under Annual
Slide 23: Supplemental
Supplemental 30
Slide 24: Notes to Investors
NOTES ongoing comparable profit equipment associated compare those Non-GAAP diluted financial isolation non-GAAP above it and used which management prior does should by period excluded margin, are excludes not shares the TO nature the or measures reconciled tax take valuation be operating as Company
Slide 25: Non-GAAP Gross Profit and Gross Margin
Non-GAAP $26. 0.2 0.1 Gross $0.6profit Gross 0.2 0.margin Non-GAAP Marginin($accordance ingross millions) margin with Annual $62.9 GAAP Q1 $19.9 31.2% Q2 Q3 $21.5 34.4% Q4$21.3 Annual 32.1% $22.7 Q1 33.3% Q2 $85.4 2013 29.7% $21.2 2014 32.2% $26. 2014 Non- 25.9% 2014 GAAP 30.6% 2014Gross 2014 Invent
Slide 26: Non-GAAP Operating Income and Margin
Non-GAAP $3.0 0.2 $8.20.$7.6 $4. Acquisition Operating $34.0 Operating $7.5 and margin $12. integration Margin Non-GAAP in accordance ($ in expenses millions) Operating with 7.2Annual GAAP 0.1 margin 0.2Q1 3.5% 0.113.1% Q2 0.9 9.6% Q3 1.3 14.5% Q4 10.8% 0.3Annual 1.14.9% Amortization 8.2% Q112.9% 5.
Slide 27: Non-GAAP Net Income, EPS and EBITDA
Non-GAAP valuation 2.8 net (1.0) 26,057,831 $0.01 income 10.1 0.$0.0 Interest 4.0 adjustment Diluted $5.0 25,750,972 Net 6. Legal expense $6.5 Income $0.12 reserves — $7.2 26,271,316 — 0.7 &$0.17 $5.9 EBITDA —0.8 — Plant, $24.6 $0.14 0.7 0.3—0.3—Deferred 26,283,52 0.9 ($ property $5.7 $0.07 3.1 in m
Slide 28: Investor Contact
Investor Contact Tracy Krumme VP, Investor Relations 513.458.2610 tkrumme@cecoenviro.com