Slide 1: Fourth Quarter 2020 Earnings Review
FOURTH QUARTER 2020 EARNINGS REVIEW FEBRUARY 23, 2021
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Statements made in the course of this presentation that express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements under the Private Securities Litigation Reform Act of 1995. They involve a number of risks and
Slide 3: Q4 2020 Update
Q4 2020 UPDATE Marvin Riley – President & CEO
Slide 4: Q4 2020 Highlights
Q4 2020 HIGHLIGHTS • Sales decreased 3.7% to $276.0M • Adjusted EBITDA* increased 11.1% to $48.1M; adjusted EBITDA* margin increased 230 bps to 17.4% • Strong balance sheet with net debt to adjusted EBITDA* of 1.6x and ample liquidity consisting of $230M cash and $389M available under revolver at qu
Slide 5: Four-Phase Response to Navigate the COVID-19 Pandemic
FOUR-PHASE RESPONSE TO NAVIGATE THE COVID-19 PANDEMIC Our cross-functional COVID-19 Response & Support Team, made up of our global executive leadership team, is working around the clock to manage our business continuity plans and coordinated response THE HEALTH AND SAFETY OF OUR EMPLOYEES, COMMUNITI
Slide 6: EnPro's Strategy and Portfolio Transformation
ENPRO’S STRATEGY AND PORTFOLIO TRANSFORMATION Focusing on niche, high- Successful Execution of Portfolio Shaping Actions margin materials science- Resulting in a More Durable Business Model 1 related businesses with strong cash flow Transaction Strategic Rationale Alluxa Closed 4Q20 • Materials scie
Slide 7: Overview of Financial Results
OVERVIEW OF FINANCIAL RESULTS Milt Childress – Executive Vice President & CFO
Slide 8: Q4 2020 Financial Performance
Q4 2020 FINANCIAL PERFORMANCE $ in millions, except per share data Sales Gross Profit & Margin Adj. EBITDA* & Margin* Adj. Diluted EPS* -3.7% +330bps +11.1% $48.1 1.4 +27.8% $1.24 $286.5 $103.5 $43.3 $98.1 38% $276.0 1.2 $0.97 43% 33% 41% 1 28% 39% 0.8 23% 37% 37.5% 35% 18% 0.6 17.4% 33% 34.2% 13% 3
Slide 9: Environmental Update
ENVIRONMENTAL UPDATE Overview: • Recognized environmental charges of $22 million in Q4 2020, which led to GAAP net loss in the fourth quarter • Charges were principally for reserve increases associated with estimated remediation costs for two legacy environmental matters where the company did not ha
Slide 10: Sealing Technologies – Q4 2020 Performance
SEALING TECHNOLOGIES – Q4 2020 PERFORMANCE $ in millions Sales Adj. Segment EBITDA* & Margin* $174.4 50 29% -11.3% $154.7 +5.4% 27% $34.9 40 $33.1 25% 30 23% 20 22.6% 21% 19% 10 19.0% 17% 0 15% Q4 2019 Q4 2020 Q4 2019 Q4 2020 • Decline in demand in the general industrial and aerospace markets, parti
Slide 11: Advanced Surface Technologies - Q4 2020 Performance
ADVANCED SURFACE TECHNOLOGIES - Q4 2020 PERFORMANCE $ in millions Sales 18 Adj. Segment EBITDA* & Margin* 40% 60 $15.4 +57.1% 38% $49.9 16 27.3% 36% 50 14 $39.2 12 $9.8 34% 40 32% 10 30% 30.9% 30 8 28% 20 6 26% 4 24% 25.0% 10 2 22% 0 0 20% Q4 2019 Q4 2020 Q4 2019 Q4 2020 • Increase driven primarily
Slide 12: Engineered Materials – Q4 2020 Performance
ENGINEERED MATERIALS – Q4 2020 PERFORMANCE $ in millions Sales 20 Adj. Segment EBITDA* & Margin* 45% 18 40% 90 80 $75.5 -2.5% $73.6 16 -2.6% 35% $11.7 14 $11.4 70 30% 12 60 25% 10 50 20% 8 40 15% 6 15.5% 15.5% 30 10% 4 20 5% 10 2 0 0 0% Q4 2019 Q4 2020 Q4 2019 Q4 2020 • Weakness in oil and gas, gene
Slide 13: Balance Sheet, Cash Flow & Capital Allocation
BALANCE SHEET, CASH FLOW & CAPITAL ALLOCATION Net Leverage Commentary Reported December 31, 2020 ($M) • Strong balance sheet; net debt to adjusted EBITDA* of 1.6x and ample liquidity consisting of $230M cash and $389M 3 available under revolver Credit Facility $0 • No debt coming due until 2024, sub
Slide 14: 2020 Pro Forma Bridge
2020 PRO FORMA BRIDGE $ in millions RESHAPING ACTIONS HAVE SIGNIFICANTLY ENHANCED PROFITABILITY OF THE PORTFOLIO Sales Adjusted EBITDA* Adjusted EBITDA Margin* -8.5% -0.5% +130bps $27 ($118) $1,074 $168.3 $167.5 17.0% $983 15.7% Reported Net Impact of Net Impact of Pro Forma Reported Pro Forma Repor
Slide 15: 2021 Guidance
2021 GUIDANCE 2021 Guidance (as of 2/23/21) Sales $1.04B – $1.08B Adjusted EBITDA * $178M – $188M Adjusted Diluted EPS * $4.32 – $4.66 Assumptions: 2021 Interest Expense ($ in Millions) • Anticipate slightly less than half of our full-year adjusted EBITDA and adjusted Interest Expense, Before Net In
Slide 16: Closing Comments
CLOSING COMMENTS Marvin Riley – President & CEO
Slide 17: Closing Comments
CLOSING COMMENTS ENPRO IS A LEADING INDUSTRIAL TECHNOLOGY COMPANY USING MATERIALS SCIENCE TO PUSH BOUNDARIES IN SEMICONDUCTOR, LIFE SCIENCES, AND OTHER TECHNOLOGY-ENABLED SECTORS ● Tremendous progress made during 2020 in transforming EnPro into a leading industrial technology company ● Strategic ach
Slide 18: Proud Supplier to Perseverance Rover
PROUD SUPPLIER TO PERSEVERANCE ROVER Image credit: NASA/JPL-Caltech 18
Slide 19: Q&A
Q&A
Slide 20: Appendix
APPENDIX
Slide 21: EnPro (NYSE: NPO) | Attractive Portfolio of Businesses
ENPRO (NYSE: NPO) | ATTRACTIVE PORTFOLIO OF BUSINESSES Company Overview Revenue Contribution 3 Headquarters Charlotte, NC Sales by Sales by Segment Sales by Channel Sales by Market Geography Manufacturing Facilities 22 primary Global Employees ~4,400 5% 3% 3% 14% 5% 25% 23% 6% 6% 47% Financial Overv
Slide 22: Consolidated Adjusted EBITDA
CONSOLIDATED ADJUSTED EBITDA 22
Slide 23: Segment Adjusted EBITDA
SEGMENT ADJUSTED EBITDA Ep?ro For the Quarters and Years Ended December 31, 2020 and 2018 (Stated in Mlions of Dollars) ‘Seang Ad Toa ‘Technoogies_ Surface Technologies Materials Segments S$ m2 $8 ays 28 m5 os 63 6g 7 13 13 7 30 30 13 5 54 87 3B 67 38 133 =r sass a7 Dee 0% 155 224% ‘quarter Ended De
Slide 24: Segment Information
SEGMENT INFORMATION Ep?ro For the Quaers and Yeas Ended December 31,200 and 2018 {Site llns of ols) Sales ‘esenber3) Zoo 20 a ‘Sealing Technologies Sway $e $y 8 Tee ‘eran Sutaoe Technolog: 220 m2 12 ater 738 a0 33 el Tas EE THE Less ssies 22 mo 63) 2) Seo § meas tor4o $a ‘Decenber 3 a0 ‘seaig es S42
Slide 25: Consolidated Adjusted Net Income
CONSOLIDATED ADJUSTED NET INCOME (Stated in Millions of Dollars, Except Per Share Data) 25
Slide 26: Consolidated Adjusted Net Income
CONSOLIDATED ADJUSTED NET INCOME (Stated in Millions of Dollars, Except Per Share Data) 26
Slide 27: Free Cash Flow
FREE CASH FLOW (Stated in Millions of Dollars) 27
Slide 28: Pro Forma Calculation
PRO FORMA CALCULATION (Stated in Millions of Dollars) Year Ended December 31, 2020 Pro forma EnPro Adjustments Pro Forma Net sales $ 1,074 $ (91) $ 983 Net income (loss) attributable to EnPro Industries, Inc. $ 184 $ 21 $ 205 Adjustments to arrive at earnings before interest, income taxes, depreciat