Slide 1: Investor Relations Presentation
(Mueller Water Products) Where Intelligence Meets Infrastructure® Investor Relations Presentation August 5, 2015
Slide 2: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES The Company reports its financial results under accounting principles generally accepted in the United States ("GAAP"), well as through the use of non-GAAP measures. ey npar adjust operating margin, adjusted EBITDA, adjusted eBITDA\ margin, adjusted net income (loss), adj
Slide 3: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Thi ments that may be deemed forward -looking Setemonne "ihn the meaning of the Private Securities Litigation Retom Act of 1995. All refinancing, including potential annualized interes! - expense savings, which assumes that LIBOR rei of Below a certain floor and excludes t
Slide 4: Our Business
OUR BUSINESS FY2014 PRIMARY END MARKETS $1 .2B LTM Net sales: $783mm ©) ANVIL Net sales: $401mm net sales (as of June 30, 2015) 20% Sh 20% 5% Residonia we ou " Specified in 75% 100 largest 15% Non-residential Repair and ‘construction replacement of municipal water distribution and treatment systems
Slide 5: Mueller Water Products
Mueller Water Products Leading provider of water infrastructure and flow control products and services in North America INVESTMENT HIGHLIGHTS I Improved results driven by strong incremental I Leading brands in water infrastructure and one of operating leverage as end markets recover the largest inst
Slide 6: Business Performance: Long-Term Targets
BUSINESS PERFORMANCE: LONG-TERM TARGETS II Mueller Co. base business organic growth of in normalized end market conditions ll Metering and leak detection products and services @ Mueller Co. adjusted EBITDA margins of is We approach more normalized end market conditions @ Metering and leak Soren ane
Slide 7: Broad Product Portfolio
BROAD PRODUCT PORTFOLIO Mueller Co. Est. 1857 $789mm $127mm $43mm $170mm Fire Hydrants Valves Butterfly, Ball & Plug Valves Metering Systems Leak Detection and Pipe Condition Assessment Note: All statistics are LTM ended June 30, 2015 (1) Mueller Co. Historical Roots Net Sales Adjusted Operating Inc
Slide 8: Intelligent Water Technology
INTELLIGENT WATER TECHNOLOGY™ Mueller Water Products manufactures and markets products and offers services used in the transmission, distribution and measurement of safe, clean drinking water and in water treatment facilities. These products and services help utilities actively diagnose, monitor and
Slide 9: Water Infrastructure Landscape
WATER INFRASTRUCTURE LANDSCAPE FIRE GATE BUTTERFLY & BRASS WATER HYDRANTS VALVES BALL VALVES PRODUCTS PRODUCT PRODUCT PRODUCT PRODUCT MucllerWaterProducts) = #1 2S3iiby #1 pasinch #1 POSITION POSITION POSITION é é é é ‘AY. McDonald ry ACIPCO ry ry DeZURIK ry Ford Meter Box ry McWane é é ry
Slide 10: Strategy and Objectives
STRATEGY AND OBJECTIVES Capitalize on the large, attractive and growing water infrastructure markets worldwide Continue to enhance Operational and organizational excellence Maintain leadership positions with customers and end users Acquire and invest in businesses and technologies that expand our po
Slide 11: Significant Market Opportunities
Significant Market ‘woh | Opportunities *
Slide 12: Market Driver: Household Formation
MARKET DRIVER: HOUSEHOLD FORMATION New household formation drives housing starts demand. Household formation is driven by population growth, accelerating job growth, higher wages and higher consumer confidence, among other factors. Year-Over-Year Change in Household Formation (r2MMa) Employment Leve
Slide 13: Market Driver: Housing Starts
MARKET DRIVER: HOUSING STARTS Homebuilders’ confidence also drives housing starts. Confidence could be driven by improving job growth in key demographic for household formation: Millennials. NAHB. Housiaa Market Index — National (1985 ~ Present) Seas’ 000 Housing Starts (1959 - 2016 Forecast) 160 ‘o
Slide 14: The Market Opportunity Is Significant and Growing
THE MARKET OPPORTUNITY IS SIGNIFICANT AND GROWING REPAIR AND FUTURE DRINKING REPLACEMENT MARKET WATER INFRASTRUCTURE I Vaves ane hyrans ae ical replaced at the same EXPENDITURE NEEDS® ime as pipe sronace ASCE graded drinking water infrastructure a D\") $39. 5 B Il Atleast 40 cities under consent dec
Slide 15: Funding Water Infrastructure Repair
FUNDING WATER INFRASTRUCTURE REPAIR HISTORICAL WATER RATES COMPARED TO OTHER UTILITIES” (CPI Water ——CPI Nat ——CPlElectricty ~——CPIAll tems pl ‘Bureau of Labor Statistics - FactSet or Static Dctons: U.S, Wat Indust ~ lak 8 Ve ‘Amorgan Water Woks Assooaton 20's Watorand Wastewater Rate Suvey EPA Clea
Slide 16: Growth Opportunities: Smart Water
GROWTH OPPORTUNITIES: SMART WATER FACTORS AFFECTING MUNICIPAL WATER SYSTEMS Water Conservation 25% of drought conditions?) + 240,000 water main breaks per year®) Non-Revenue Water + Up to 30% of treated water is lost or unaccounted for‘) + 1.7 trillion gallons lost per year at a national cost of $2.
Slide 17: Smart Solutions for Today & Tomorrow
SMART SOLUTIONS FOR TODAY & TOMORROW INTELLIGENT WATER TECHNOLOGY (Mueller systevs) ——————_ , echolo@ics Leak Detection & Pipe Condition Assessment + Fixed transmission and distribution main leak detection monitoring 420 RDM + Field services Smart Metering + AMR systems + AMI systems + Remote Discon
Slide 18: Anvil
ANVIL Leading domestic manufacturer of piping system components O Il Significant FY2014 net sales from #1 or #2 product positions I Customer service capabilities focused on quick delivery é I Domestically manufactured and domestically and internationally sourced products MW Track record of solid adj
Slide 19: Anvil Key Markets
ANVIL KEY MARKETS Non-Residential 75% Mechanical, Industrial & Fire Protection Construction 5 Oil & Gas 20% Production Power/High Pressure Power Need Development Mechanical and Industrial: Grooved, Iron/Steel Fittings, Staple Hangers, Pipe Nipples, Bull Plug: Fire Protection: O-Lets, Grooved Fitting
Slide 20: Market Driver: Non-Residential Construction
MARKET DRIVER: NON-RESIDENTIAL CONSTRUCTION The non-residential construction market is showing improvement Non-Residential Construction AIA Architectural Billing Index (Real $ in Billions) Diffusion Index (> 50 = expansion) Source: American institute of Architects Data as of June 2015,
Slide 21: Market Driver: Oil & Gas
MARKET DRIVER: OIL & GAS Sales to the oil & gas market represented about 20% of Anvil’s FY2014 net sales U.S. Land Based Rig Count Oil Price - WTI ($/bbl) $140 { 2,000 pol PA 1,500 $100 } $80 } wie) fe | $20 0 seseesggagegeee2en8 90 2E aaa trec re Fee 2 PY 2 yg gRgeadt SSBSB33833333338 sSSesgsessses
Slide 22: Actions & Business Results
Actions & Business Results
Slide 23: Management Actions / Initiatives
MANAGEMENT ACTIONS / INITIATIVES Reduce costs and improve operating leverage 1 Divested U.S. Pipe fT Die stea three non-core assets of vil I Implemented Lean Six Sigma and ‘other manufacturing improvements: Increased production capacity without footprint expansion + Lowered labor costs Il Closed sev
Slide 24: History of Strong Financial Performance
HISTORY OF STRONG FINANCIAL PERFORMANCE &) * ‘Mueller Co.) @AnvIE Net Sales (Gin millions) 3 3 | | [] | E Adjusted EBITDA& ($ in millions)
Slide 25: Consolidated Non-GAAP Results
CONSOLIDATED NON-GAAP RESULTS @ Net sales impacted by above-average rainfall primarily in Texas, Colorado and 3Q FISCAL 2015 2014 parts of the Midwest Net sales $301.0 $318.5 @ Adjusted EBITDA margin for the 2015 third quarter improved 160 basis points Adj. operating income $43.3 $42.0 to 19.2 perce
Slide 26: Debt Structure
DEBT STRUCTURE Net debt leverage of 2.3x and net debt of $436 million at June 30, 2015, down from a peak of more than 6x No significant required principal payments on outstanding debt before November 2021 @ No financial maintenance covenants with excess availability at the greater of $22.5 million o
Slide 27: Capital Allocation
CAPITAL ALLOCATION = Acquisitions = Debt reduction ™ Share repurchases = Growth opportunities Fy2010 Fv2011 Fy2012 *¥2013 Fy2014 ™ Dividends
Slide 28: Why Invest in MWA?
WHY INVEST IN MWA? Water industry has fundamentally strong Strong operating leverage as end markets long-term dynamics recover Ill Driven by need for new and upgraded I Recovery of residential construction market infrastructure @ Increased municipal spending Il Limited number of suppliers to end mar
Slide 29: Supplemental Data
Slide 30: Segment Results and Reconciliation
SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES (Sin millions, except per share amounts)
Slide 31: Segment Results and Reconciliation
SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES quater ended tne 30,2014 (Sin millions, except per share amounts) Tasers — wt cepa — Tea net siee per a a a ne rs oti sms ms ~s om
Slide 32: Segment Results and Reconciliation
SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES (Sin mitlons, except pr share amounts) ue ests ne ‘rel 2nd adnate epess tacrelated re pense Interest expense, net Lass on early extinguishment of debt tax expense "Net income ‘Adjusted eperating income (ls) ‘Adjusted EBITOR
Slide 33: Segment Results and Reconciliation
SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES (Sin millions, except per share amounts) Nine months ended June 30, 2014 re 684? rests: Net sales profit ‘sn ener an admins exper Net income per dite share Copia expenditures Non GAtP rests: ‘Adjusted operating income (loss)
Slide 34: Segment Results and Reconciliation
SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES (Sin millions, except per share amounts) = Netbeans EID) ai
Slide 35: Segment Results and Reconciliation
SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES (Sin millions, except per share amounts)
Slide 36: Questions
Questions