Slide 1: Third Quarter 2023 Earnings Call
Third Quarter 2023 Earnings Call October 31, 2023
Slide 2: Forward Looking Statements and Non-GAAP Measures
Forward Looking Statements and Non-GAAP Measures Forward Looking Statements Certain statements contained herein may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements about expectations regarding our financial re
Slide 3: Key Messages
Key Messages 1 Favorable Price | Cost | Productivity continues to drive significant margin expansion 2 Megatrends intact; anticipate channel inventories largely normalized by year end 3 Deploying >$1B to acquire attractive businesses with strong financial and strategic fit 4 Raising 2023 outlook; we
Slide 4: 3Q 2023 Results
3Q 2023 Results $1.38B Organic net sales growth driven by strong price realization Sales Strong utility end market demand; continued channel inventory normalization (Organic +4%, Acquisitions +1%) 21.4% Robust margin expansion on favorable Price | Cost | Productivity Adj. OP Margin Operation
Slide 5: 3Q 2023 Results
3Q 2023 Results NET SALES ADJUSTED OPERATING PROFIT $ millions $ millions +5% +31% 1,376 295 1,316 21.4% 224 17.0% 3Q 2022 3Q 2023 3Q 2022 3Q 2023 ADJUSTED DILUTED EPS FREE CASH FLOW $ per share $ millions +28% -18% $3.95 194 159 $3.08 3Q 2022 3Q 2023 3Q 2022 3Q 2023 Strong third quarter results 5
Slide 6: 3Q 2023 Hubbell Utility Solutions (HUS) Segment Results
3Q 2023 Hubbell Utility Solutions (HUS) Segment Results UTILITY SOLUTIONS NET SALES UTILITY SOLUTIONS ADJ. OPERATING PROFIT $ millions +8% $ millions +39% 838 201 775 24.0% 144 18.6% 3Q 2022 3Q 2023 3Q 2022 3Q 2023 Organic +7%; acquisition +1% T&D Components +3% Price | Cost positive Strong
Slide 7: 3Q 2023 Hubbell Electrical Solutions (HES) Segment Results
3Q 2023 Hubbell Electrical Solutions (HES) Segment Results ELECTRICAL SOLUTIONS NET SALES ELECTRICAL SOLUTIONS ADJ. OPERATING PROFIT $ millions -1% $ millions +17% 542 538 94 17.5% 80 14.8% 3Q 2022 3Q 2023 3Q 2022 3Q 2023 Organic -1% Price | Cost positive Industrial markets solid; Commercial m
Slide 8: Capital Allocation Spotlight: M&A in Strategic Growth Verticals
Capital Allocation Spotlight: M&A in Strategic Growth Verticals Electric T&D Grid Automation Renewables Infrastructure Systems Control Balestro Transaction Details* Strategic Rationale $1.1B investment at ~12x 2024E EBITDA Leading provider of substation control and relay panels, as well as turnk
Slide 9: Systems Control
Systems Control Business Profile Double digit sales CAGR over last 8 years Mission-critical control buildings protect, monitor and control substations; low percentage of cost with high cost of failure Leading provider of turnkey solutions delivering significant labor savings to utility Compl
Slide 10: 2023 Outlook
2023 Outlook Updated 2023 ~8% $15.00 – $15.25 >$700M Full Year Total Sales Growth y/y Adjusted EPS Outlook (+7% Organic; +1% M&A) (>40% y/y growth at midpoint) Free Cash Flow ADJUSTED EPS PERFORMANCE $ per share 4Q 2023 Considerations $15.00 to >25% CAGR $15.25 Anticipate normal sales seasonality
Slide 11: 2024 Early Preview
2024 Early Preview Markets positioned to outperform GDP Focused on maintaining strong realized price 2024 Planning Planning for persistent inflation Considerations Accelerating productivity initiatives Maintaining investment at elevated levels HUBBELL UTILITY SOLUTIONS (HUS) HUBBELL ELECTR
Slide 12: Appendix
APPENDIX USBELL
Slide 13: Appendix: Non-GAAP Definitions
APPENDIX References to "adjusted" operating measures exclude the impact of certain costs, gains or losses. Management Free cash flow is a non-GAAP measure and is defined as cash flow from operations less capital expenditures. believes these adjusted operating measures provide useful information rega
Slide 14: Reconciliation of Adjusted Net Income and Adjusted EPS
APPENDIX Reconciliation of Adjusted Net Income to the most directly comparable GAAP measure (millions): Hubbell Incorporated Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 Change 2023 2022 Change Net income from continuing operations attributable to Hubbell (GAAP measure)
Slide 15: Reconciliation of Adjusted Operating Margin
APPENDIX Reconciliation of Adjusted Operating Margin to the most directly comparable GAAP measure (millions): Hubbell Incorporated Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 Change 2023 2022 Change Net Sales [a] $ 1,375.8 $ 1,316.2 5% $ 4,027.1 $ 3,728.3 8% Operating
Slide 16: Reconciliation of Organic Net Sales Growth
APPENDIX Reconciliation of Organic Net Sales Growth to Net Sales Growth (millions): Hubbell Incorporated Three Months Ended September 30, Nine Months Ended September 30, 2023 Inc/(Dec)% 2022 Inc/(Dec)% 2023 Inc/(Dec)% 2022 Inc/(Dec)% Net sales growth (GAAP measure) $ 59.6 4.5 $ 232.8 21.5 $ 298.8 8.
Slide 17: Reconciliation of Net Debt and Free Cash Flow
APPENDIX Reconciliation of Net Debt to the most directly comparable GAAP measure (millions): Hubbell Incorporated September 30, 2023 December 31, 2022 Total Debt (GAAP measure) $ 1,443.0 $ 1,442.6 Total Hubbell Shareholders’ Equity 2,739.1 2,360.9 Total Capital $ 4,182.1 $ 3,803.5 Total Debt to Tota