Rockwell Automation, Inc. · NYSE:ROK
Rockwell Automation — Q3 2017 Earnings Presentation
17 slides from Rockwell Automation's earnings presentation, Jul 26, 2017
Slide 1: Fiscal Year 2017 Third Quarter Conference Call
Rockwell Automation Fiscal Year 2017 Third Quarter Conference Call July 26, 2017 Copyright © 2017 Rockwell Automation, Inc. All rights reserved.
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT THIS PRESENTATION INCLUDES STATEMENTS RELATED TO THE EXPECTED FUTURE RESULTS OF THE COMPANY AND ARE THEREFORE FORWARD- LOOKING STATEMENTS. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE PROJECTIONS DUE TO A WIDE RANGE OF RISKS AND UNCERTAINTIES, INCLUDING THOSE THAT ARE LISTED
Slide 3: Fiscal 2017 Third Quarter Results and Full Year Outlook
Fiscal 2017 Third Quarter Results and Full Year Outlook Q3 Results ▪ Organic sales up 8.2% YOY, as expected – Double-digit growth in Asia Pacific and Latin America; U.S. up 8% – Transportation, food and beverage, semiconductor strong – A&S growth of 10.5%; Logix growth of 10% ▪ Acquisitions contribu
Slide 4: Key Financial Information: Third Quarter
Key Financial Information: Third Quarter (in millions, except per share amounts) Q3 2017 Q3 2016 YOY B/(W) Sales $ 1,599 $ 1,474 8.5 % Segment Operating Margin 21.1 % 21.1 % — bps General Corporate - Net $ 17 $ 17 $ — Adjusted EPS $ 1.76 $ 1.55 13.5 % Adjusted Effective Tax Rate 22.4 % 25.1 % 270 bp
Slide 5: Architecture & Software
Architecture & Software Sales Segment Operating Margin ($ millions) $2,500 40% $2,147 $1,939 $2,000 27.6% 27.9% 28.1% 30% 26.6% $1,500 20% $1,000 $732 $666 10% $500 $0 0% Q3 YTD Q3 YTD 2016 2017 2016 2017 YOY Sales % Change ▪ Segment operating margin expanded Q3 2017 YTD 30 bps in Q3, primarily due
Slide 6: Control Products & Solutions
Control Products & Solutions Sales Segment Operating Margin ($ millions) $3,000 20% $2,402 $2,497 $2,500 15.7% 15.3% 15.4% 15% 13.9% $2,000 $1,500 10% $1,000 $808 $867 5% $500 $0 0% Q3 YTD Q3 YTD 2016 2017 2016 2017 YOY Sales % Change ▪ Segment operating margin contracted Q3 2017 YTD 40 bps in Q3, p
Slide 7: Regional Sales
Regional Sales (in millions, except percentages) Q3 2017 YTD Organic Organic Region Sales % Change Sales % Change Third Quarter * U.S. $ 881 8.1% $ 2,570 5.0% ▪ U.S. and Canada growth led by transportation Canada 82 4.3% 250 5.8% ▪ EMEA flat, as expected EMEA 297 (0.1)% 869 3.4% ▪ Broad-based growth
Slide 8: Revised Fiscal 2017 Guidance
Revised Fiscal 2017 Guidance July April Guidance Guidance Sales ~ $6.3B ~ $6.25B Organic Growth ~ 6% 4.5% to 7.5% Currency Translation ~ (0.5)% ~ (1.5)% Acquisitions ~ 1.5% ~ 1.5% Segment Operating Margin ~ 20.5% ~ 20.5% Adjusted Effective Tax Rate ~ 21% ~ 22% Adjusted EPS $6.60 - $6.80 $6.45 - $6.7
Slide 9: Appendix: Supplemental Financial Information and Reconciliations to Non-GAAP Measures
Appendix Supplemental Financial Information and Reconciliations to Non-GAAP Measures Copyright © 2017 Rockwell Automation, Inc. All rights reserved.
Slide 10: Third Quarter Results: Summary
Third Quarter Results: Summary (in millions, except per share amounts) Q3 2017 Q3 2016 Total Sales $ 1,599.2 $ 1,474 Total Segment Operating Earnings $ 337.0 $ 311.0 Purchase Accounting Depreciation and Amortization (5.6) (4.7) General Corporate - Net (16.5) (17.0) Non-Operating Pension Costs (19.8)
Slide 11: Free Cash Flow
Free Cash Flow (in millions) Q3 2017 YTD Net Income $ 216.9 $ 621.1 Depreciation/Amortization 43.0 124.0 Retirement Benefits Expense 43.1 129.2 Receivables/Inventory/Payables (13.0) (26.0) Compensation and Benefits 54.5 105.7 Pension Contributions (12.3) (40.8) Income Taxes (14.7) (22.4) Other (2.2)
Slide 12: Reconciliation to Non-GAAP Measures
Reconciliation to Non-GAAP Measures Organic Sales (in millions, except percentages) Three Months Ended June 30, 2017 2016 Sales Sales Organic Effect of Excluding Growth Growth Changes in Changes in Effect of Organic (Decline) (Decline) Sales(a) Currency Currency Acquisitions Sales(b) Sales(c) (a)/(c
Slide 13: Reconciliation to Non-GAAP Measures
Reconciliation to Non-GAAP Measures Organic Sales (in millions, except percentages) Three Months Ended June 30, 2017 2016 Sales Sales Organic Effect of Excluding Growth Growth Changes in Changes in Effect of Organic (Decline) (Decline) Sales(a) Currency Currency Acquisitions Sales(b) Sales(c) (a)/(c
Slide 14: Reconciliation to Non-GAAP Measures
Reconciliation to Non-GAAP Measures Segment Operating Margin (in millions, except percentages) Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended June 30, 2017 June 30, 2016 June 30, 2017 June 30, 2016 Sales Architecture & Software (a) $ 731.9 $ 666.4 $ 2,147.3 $ 1,938.8 Contr
Slide 15: Reconciliation to Non-GAAP Measures
Reconciliation to Non-GAAP Measures Adjusted Income, Adjusted EPS and Adjusted Effective Tax Rate (in millions, except per share amounts) Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended June 30, 2017 June 30, 2016 June 30, 2017 June 30, 2016 Income from continuing operation
Slide 16: Reconciliation to Non-GAAP Measures
Reconciliation to Non-GAAP Measures Return On Invested Capital (in millions, except percentages) Twelve Months Ended June 30, 2017 2016 (a) Return Income from continuing operations $ 806.3 $ 745.8 Interest expense 74.9 69.8 Income tax provision 194.5 239.3 Purchase accounting depreciation and amorti
Slide 17: Reconciliation to Non-GAAP Measures
Reconciliation to Non-GAAP Measures Fiscal 2017 Guidance (in billions, except percentages and per share amounts) Organic Sales July Guidance April Guidance Organic sales growth ~ 6% 4.5% to 7.5% Foreign currency impact ~ (0.5)% ~ (1.5)% Acquisition impact ~ 1.5% ~ 1.5% Reported sales growth ~ 7% 4.5