Rockwell Automation, Inc. · NYSE:ROK
Rockwell Automation — Q2 2018 Earnings Presentation
17 slides from Rockwell Automation's earnings presentation, Apr 25, 2018
Slide 1: Fiscal Year 2018 Second Quarter Conference Call
Rockwell Automation Fiscal Year 2018 Second Quarter Conference Call April 25, 2018 Copyright © 2018 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 2018 Second Quarter and First Half Results
Fiscal 2018 Second Quarter and First Half Results Q2 Results ▪ Organic sales up 3.5% YOY, as expected – Growth led by heavy industries, including oil and gas, mining, metals, and semiconductor – Logix growth of 5%; Process growth of 9% – Double-digit growth in Information Solutions and Connected Ser
Slide 4: Key Financial Information: Second Quarter
Key Financial Information: Second Quarter (in millions, except per share amounts) Q2 2018 Q2 2017 YOY B/(W) Sales $ 1,651 $ 1,554 6.2 % Segment Operating Earnings $ 345 $ 296 16.6 % Segment Operating Margin 20.9 % 19.0 % 190 bps General Corporate - Net $ 18 $ 21 $ 3 Adjusted EPS $ 1.89 $ 1.55 21.9 %
Slide 5: Architecture & Software
Architecture & Software Sales Segment Operating Margin ($ millions) $1,800 40% $1,515 $1,415 29.2% $1,400 30% 28.4% 28.2% 26.5% $1,000 20% $719 $768 $600 10% $200 0% Q2 YTD Q2 YTD 2017 2018 2017 2018 YOY Sales % Change ▪ Segment operating margin expanded Q2 2018 YTD 190 bps in Q2, primarily due to h
Slide 6: Control Products & Solutions
Control Products & Solutions Sales Segment Operating Margin ($ millions) $2,000 20% $1,723 $1,629 15.0% $1,600 15% 14.4% 12.6% 13.1% $1,200 10% $835 $883 $800 5% $400 0% Q2 YTD Q2 YTD 2017 2018 2017 2018 YOY Sales % Change ▪ Segment operating margin expanded Q2 2018 YTD 180 bps in Q2, primarily due
Slide 7: Regional Sales
Regional Sales (in millions, except percentages) Q2 2018 YTD Organic Organic Region Sales % Change Sales % Change Second Quarter * U.S. $ 888 3.6% $ 1,740 4.5% ▪ U.S. growth led by heavy industries; oil and gas up double digits Canada 86 2.4% 178 6.9% ▪ EMEA decline due to project EMEA 341 (1.1)% 64
Slide 8: Revised Fiscal 2018 Guidance
Revised Fiscal 2018 Guidance April January Guidance Guidance Sales ~ $6.7B ~ $6.7B Organic Growth Range 3.5% to 6.5% 3.5% to 6.5% Currency Translation ~ 2% ~ 2% Divestiture ~ (1)% ~ (1)% Segment Operating Margin ~ 21.5% ~ 21.5% Adjusted Effective Tax Rate ~ 20.5% ~ 21% Adjusted EPS $7.70 - $8.00 $7.
Slide 9: Appendix: Supplemental Financial Information and Reconciliations to Non-GAAP Measures
Appendix Supplemental Financial Information and Reconciliations to Non-GAAP Measures Copyright © 2018 Rockwell Automation, Inc. All rights reserved.
Slide 10: Second Quarter Results: Summary
Second Quarter Results: Summary (in millions, except per share amounts) Q2 2018 Q2 2017 Total Sales $ 1,651.2 $ 1,554.3 Total Segment Operating Earnings $ 345.1 $ 296.0 Purchase Accounting Depreciation and Amortization (4.5) (5.6) General Corporate - Net (17.8) (21.4) Non-Operating Pension Costs (5.
Slide 11: Free Cash Flow
Free Cash Flow (in millions) Q2 2018 YTD Net Income $ 227.4 $ (9.0) Depreciation/Amortization 43.2 82.8 Retirement Benefits Expense 28.4 56.7 Receivables/Inventory/Payables 63.9 (10.5) Compensation and Benefits 9.3 (67.7) Pension Contributions (11.9) (23.5) Income Taxes 0.6 508.6 Other 20.5 56.7 Cas
Slide 12: Reconciliation to Non-GAAP Measures: Organic Sales by Region
Reconciliation to Non-GAAP Measures Organic Sales (in millions, except percentages) Three Months Ended March 31, 2018 2017 Sales Sales Organic Effect of Excluding Sales Growth Growth Changes in Changes in Effect of Organic Effect of Excluding (Decline) (Decline) Sales(a) Currency Currency Acquisitio
Slide 13: Reconciliation to Non-GAAP Measures: Organic Sales by Segment
Reconciliation to Non-GAAP Measures Organic Sales (in millions, except percentages) Three Months Ended March 31, 2018 2017 Sales Sales Organic Effect of Excluding Sales Growth Growth Changes in Changes in Effect of Organic Effect of Excluding (Decline) (Decline) Sales(a) Currency Currency Acquisitio
Slide 14: Reconciliation to Non-GAAP Measures: Segment Operating Margin
Reconciliation to Non-GAAP Measures Segment Operating Margin (in millions, except percentages) Three Months Ended Three Months Ended Six Months Ended Six Months Ended March 31, 2018 March 31, 2017 March 31, 2018 March 31, 2017 Sales Architecture & Software (a) $ 768.4 $ 719.0 $ 1,515.3 $ 1,415.4 Con
Slide 15: Reconciliation to Non-GAAP Measures: Adjusted Income, EPS and Tax Rate
Reconciliation to Non-GAAP Measures Adjusted Income, Adjusted EPS and Adjusted Effective Tax Rate (in millions, except per share amounts) Three Months Ended Six Months Ended March 31, 2018 March 31, 2017 March 31, 2018 March 31, 2017 Income from continuing operations $ 227.4 $ 189.5 $ (9.0) $ 404.2
Slide 16: Reconciliation to Non-GAAP Measures: Return On Invested Capital
Reconciliation to Non-GAAP Measures Return On Invested Capital (in millions, except percentages) Twelve Months Ended March 31, 2018 2017 (a) Return Income from continuing operations $ 412.5 $ 780.4 Interest expense 75.9 73.9 Income tax provision 734.4 196.7 Purchase accounting depreciation and amort
Slide 17: Reconciliation to Non-GAAP Measures: Fiscal 2018 Guidance
Reconciliation to Non-GAAP Measures Fiscal 2018 Guidance (in billions, except percentages and per share amounts) Organic Sales April Guidance January Guidance Organic sales growth 3.5% to 6.5% 3.5% to 6.5% Foreign currency impact ~ 2% ~ 2% Divestiture impact ~ (1)% ~ (1)% Reported sales growth 4.5%