Slide 1: TE Connectivity First Quarter 2022 Earnings
EVERY CONNECTION COUNTS TE Connectivity First Quarter 2022 Earnings January 26, 2022
Slide 2: Forward-Looking Statements
Forward - Looking Statements This presentation contains certain "forward - looking statements" within the meaning of the U.S. Private Securities Litigation Ref orm Act of 1995. These statements are based on management's current expectations and are subject to risks, uncertainty and changes in circum
Slide 3: Earnings Highlights
Earnings Highlights Q1 Sales up 8% & Adjusted EPS up 20% Y/Y demonstrating diversity of our portfolio and strong operational performance • Sales of $3.8B, up 8% Y/Y on both a reported and organic basis • Transportation better than expected; sales down 2% organically Y/Y due to auto production declin
Slide 4: Segment Orders Summary
Reported FY21 FY21 FY22 Q1 Growth Q1 Q4 Q1 Y/Y Q/Q Transportation 2,537 2,349 2,158 (15)% (8)% Industrial 956 1,140 1,402 47% 23% Communications 556 647 769 38% 19% Total TE 4,049 4,136 4,329 7% 5% Book to Bill 1.15 1.08 1.13 Segment Orders Summary ($ in millions) 4 • Demand remains healthy in each
Slide 5: Transportation Solutions
Transportation Solutions $2,224 $2,158 Q1 2021 Q1 2022 • Automotive production declines partially offset by continued benefit from content outperformance due to electronification and electric vehicle adoption • Commercial Transportation growth driven by North America and Europe, along with increased
Slide 6: Industrial Solutions
Industrial Solutions $873 $1,059 Q1 2021 Q1 2022 Y/Y Growth Rates Reported Organic Industrial Equipment $462 57% 40% Aerospace , Defense and Marine 242 (3)% (3)% Energy 188 9% 17% Medical 167 7% 8% Industrial Solutions $1,059 21% 18% Margin expansion driven by higher volume and strong operational pe
Slide 7: Communications Solutions
$425 $601 Q1 2021 Q1 2022 Reported Up 41% Organic Up 40% Y/Y Growth Rates Reported Organic Data & Devices $349 49% 48% Appliances 252 32% 32% Communications Solutions $601 41% 40% • D ata & Devices double digit growth across all regions driven by content growth and share gains in high - speed clou d
Slide 8: Q1 Financial Summary
Q1 Financial Summary ($ in Millions, except per share amounts) Q1 FY21 Q1 FY22 Net Sales $ 3,522 $ 3,818 Operating Income $ 448 $ 672 Operating Margin 12.7% 17.6% Acquisition - Related Charges 9 16 Restructuring & Other Charges, Net 167 24 Adjusted Operating Income $ 624 $ 712 Adjusted Operating Mar
Slide 9: Q1 Financial Performance
Q1 Financial Performance $3,522 $3,818 $3,818 Q1 2021 Q4 2021 Q1 2022 $1.47 $1.69 $1.76 Q1 2021 Q4 2021 Q1 2022 Adjusted EBITDA Margin 23.0% 23.2% 23.8% 17.7% 18.5% 18.6% Q1 2021 Q4 2021 Q1 2022 Adjusted Operating Margin, Adjusted EPS, Adjusted EBITDA Margin and Free Cash Flow are non - GAAP financi
Slide 10: Additional Information
EVERY CONNECTION COUNTS Additional Information
Slide 11: Q1 2022 Sales and Adjusted EPS Year over Year
Y/Y Q1 2022 Adjusted EPS is a non - GAAP financial measure; See Appendix for description and reconciliation. Sales (in millions) Adjusted EPS Q1 2021 Results $3,522 $1.47 Operational Performance 341 0.23 FX Impact (45) 0.01 Tax Rate Impact - 0.05 Q1 2022 Results $3,818 $1.76 11
Slide 12: Q2 2022 Guidance Sales and Adjusted EPS Year over Year
Y/Y Q2 2022 Adjusted EPS is a non - GAAP financial measure; See Appendix for description and reconciliation. Sales (in millions) Adjusted EPS Q2 2021 Results $3,738 $1.57 Operational Performance 173 0.17 FX Impact (111) (0.03) Tax Rate Impact - (0.01) Q2 2022 Guidance $3,800 $1.70 12
Slide 13: Q1 Balance Sheet, Free Cash Flow and Working Capital
($ in Millions) Q1 2021 Q1 2022 Beginning Cash Balance $945 $1,203 Free Cash Flow 529 373 Dividends (159) (163) Share repurchases (119) (304) Net decrease in debt (30) (76) Acquisition of businesses, net of cash acquired (107) (100) Other 39 49 Ending Cash Balance $1,098 $982 Total Debt $4,201 $4,00
Slide 14: Appendix
EVERY CONNECTION COUNTS Appendix
Slide 15: Non-GAAP Financial Measures
15 Non - GAAP Financial Measures We present non - GAAP performance and liquidity measures as we believe it is appropriate for investors to consider adjusted financ ial measures in addition to results in accordance with accounting principles generally accepted in the U.S. (“GAAP”). These non - GAAP f
Slide 16: Non-GAAP Measure Descriptions
16 • Adjusted EBITDA and Adjusted EBITDA Margin - represent net income and net income as a percentage of net sales, respectively, (th e most comparable GAAP financial measures) before interest expense, interest income, income taxes, depreciation, and amortization, as adjusted for net other i nco me
Slide 17: Segment Summary
Segment Summary 17 Transportation Solutions $ 2,158 $ 2,224 Industrial Solutions 1,059 873 Communications Solutions 601 425 Total $ 3,818 $ 3,522 Transportation Solutions $ 395 18.3 % $ 308 13.8 % Industrial Solutions 123 11.6 76 8.7 Communications Solutions 154 25.6 64 15.1 Total $ 672 17.6 % $ 448
Slide 18: Reconciliation of Net Sales Growth
Reconciliation of Net Sales Growth 18 Transportation Solutions (3) : Automotive $ (109) (6.7) % $ (91) (5.6) % $ (18) $ — Commercial transportation 34 10.3 36 10.8 (2) — Sensors 9 3.4 13 4.8 (4) — Total (66) (3.0) (42) (1.8) (24) — Industrial Solutions (3) : Industrial equipment 167 56.6 119 39.7 (1
Slide 19: Non-GAAP Reconciliation, Quarter Ended December 24, 2021
Reconciliation of Non - GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended December 24, 2021 19 Operating income: Transportation Solutions $ 395 3 (6) — $ 392 Industrial Solutions 123 12 22 — 157 Communications Solutions 154 1 8 — 163 Total $ 672 $ 16 $ 24 $ — $ 712 Operating m
Slide 20: Non-GAAP Reconciliation, Quarter Ended September 24, 2021
Reconciliation of Non - GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended September 24, 2021 20 Operating income: Transportation Solutions $ 387 $ 3 $ 5 $ — $ — $ 395 Industrial Solutions 134 4 24 — — 162 Communications Solutions 139 1 9 — — 149 Total $ 660 $ 8 $ 38 $ — $ — $
Slide 21: Non-GAAP Reconciliation, Quarter Ended March 26, 2021
Reconciliation of Non - GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended March 26, 2021 21 Operating income: Transportation Solutions $ 398 $ 5 $ 10 $ 413 Industrial Solutions 111 3 5 119 Communications Solutions 103 — 2 105 Total $ 612 $ 8 $ 17 $ 637 Operating margin 16.4 %
Slide 22: Non-GAAP Reconciliation, Quarter Ended December 25, 2020
Reconciliation of Non - GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended December 25, 2020 22 Operating income: Transportation Solutions $ 308 $ 5 $ 118 $ — $ 431 Industrial Solutions 76 4 38 — 118 Communications Solutions 64 — 11 — 75 Total $ 448 $ 9 $ 167 $ — $ 624 Operatin
Slide 23: Non-GAAP Reconciliation, Year Ended September 24, 2021
Reconciliation of Non - GAAP Financial Measures to GAAP Financial Measures for the Year Ended September 24, 2021 23 Operating income: Transportation Solutions $ 1,526 $ 18 $ 135 $ — $ — $ 1,679 Industrial Solutions 469 15 73 — — 557 Communications Solutions 439 1 25 — — 465 Total $ 2,434 $ 34 $ 233
Slide 24: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow 24 Net cash provided by operating activities $ 532 $ 640 Net cash used in investing activities (199) (246) Net cash used in financing activities (552) (252) Effect of currency translation on cash (2) 11 Net increase (decrease) in cash, cash equivalents, and restricte
Slide 25: Reconciliation of Adjusted EBITDA and Adjusted EBITDA Margin
Reconciliation of Adjusted EBITDA and Adjusted EBITDA Margin 25 Net income $ 566 $ 794 $ 381 (Income) loss from discontinued operations 1 — (6) Income tax expense (benefit) 110 (167) 60 Other (income) expense, net (15) 22 1 Interest expense 12 14 15 Interest income (2) (3) (3) Operating income 672 6
Slide 26: Reconciliation of Forward-Looking Non-GAAP Financial Measures
Reconciliation of Forward - Looking Non - GAAP Financial Measures to Forward - Looking GAAP Financial Measures 26 Diluted earnings per share from continuing operations $ 1.52 Restructuring and other charges, net 0.12 Acquisition-related charges 0.03 Tax items 0.03 Adjusted diluted earnings per share