Slide 1: Second Quarter 2022 Earnings Release
Second Quarter 2022 Earnings Release August 4, 2022 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the federal securities laws. These statements include, but are not limited to statements regarding Vontier Corporation’s (the “Company’s”) business and acquisition opportunities, anticipated revenu
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation contains references to “core revenue growth,” “free cash flow,” "free cash flow conversion," “adjusted free cash flow,” “adjusted free cash flow conversion,” “adjusted operating profit,” “adjusted operating profit margin,” “adjusted core operating margin
Slide 4: Q2 2022 Summary
Q2 2022 Summary Strong execution, price/cost performance, and capital allocation drove double-digit earnings growth – Adj. EPS $0.72, +18% on DD DRB and Environmental growth, strong price and cost actions; partially offset by supply chain and inflation headwinds – Adj. GMX +100 bps driven by price a
Slide 5: Q2 2022 Financial Performance
Q2 2022 Financial Performance Summary of Key Financial Items • Total growth: 7.2% • GAAP OP Margins +90 bps • GAAP EPS of $0.21 • Core revenue growth: 1.6% • Adj. Core OMX +10 bps • 23.0% Adj. Effective Tax Rate ("ETR") • Acquisitions: 8.2% • Reflecting Adj. GMX +100 bps • Share Repurchase +$0.04 •
Slide 6: Q2 2022 Free Cash Flow Detail
Q2 2022 Free Cash Flow Detail Adj. Free Cash Flow ($M) and FCF Conversion (%) 47% • Q2 2022: – Free Cash Flow: $-6.4M, -115%; conversion of -19% of GAAP Net Earnings – Adj. Free Cash Flow: $13M, -74%; conversion of 11% of Adj. Net Earnings, 11% primarily reflecting further deterioration in sales lin
Slide 7: Performance by Platform
Performance by Platform Mobility Technologies Diagnostics & Repair Technologies Revenue Revenue +11.0% • DRB share gains (3.7)% • Matco demand Core +3.5% drive growth of Core (3.6)% normalizing high-20s% above pre- pandemic levels • GVR core revenue +MSD; non-EMV • Hennessy down core revenue LDD ref
Slide 8: Expect Core Revenue Growth Rate of MSD Post EMV Sunset
Expect Core Revenue Growth Rate of MSD Post EMV Sunset HSD Non-EMV Core Revenue Growth 2022-2023 EMV Profitable Growth Platform Capital YoY Sunset Initiatives Strategies Deployment1 Revenue -$300M to - +LDD YoY +HSD YoY ~$100M Impact $350M Core Growth Core Growth >Fleet Average Incremental OP ~50% >
Slide 9: Thoughts on Q3 and FY22
Thoughts on Q3 and FY22 Q3 Considerations – Anticipate total revenue growth +MSD, core revenue +LSD, reflecting stabilizing supply chain and EMV headwind of roughly $10M to $15M – Expect adj. core OMX of +20 to +40 bps, excluding restructuring costs – Expect adj. EPS of $0.85 - $0.90 – ETR ~23% FY22
Slide 10: Supplemental Reconciliation Data
Supplemental Reconciliation Data 10 10
Slide 11: Reconciliation of Gross Profit to Adjusted Gross Profit and Margin
RECONCILIATION OF GROSS PROFIT TO ADJUSTED GROSS PROFIT AND ADJUSTED GROSS PROFIT MARGIN Three Months Ended Six Months Ended $ in millions July 1, 2022 July 2, 2021 July 1, 2022 July 2, 2021 Revenue (GAAP) $ 776.4 $ 724.6 $ 1,524.5 $ 1,432.0 Gross Profit (GAAP) $ 348.1 $ 318.5 $ 683.4 $ 630.3 Restru
Slide 12: Reconciliation of Operating Profit to Adjusted Operating Profit and Margin
RECONCILIATION OF OPERATING PROFIT TO ADJUSTED OPERATING PROFIT AND ADJUSTED OPERATING PROFIT MARGIN Three Months Ended Six Months Ended $ in millions July 1, 2022 July 2, 2021 July 1, 2022 July 2, 2021 Revenue (GAAP) $ 776.4 $ 724.6 $ 1,524.5 $ 1,432.0 Operating Profit (GAAP) $ 136.5 $ 121.0 $ 271.
Slide 13: Reconciliation of Adjusted Operating Profit Margin Expansion
RECONCILIATION OF ADJUSTED OPERATING PROFIT MARGIN EXPANSION Three Months Ended Six Months Ended July 1, 2022 July 1, 2022 2021 Adjusted Operating Profit Margin (Non-GAAP) 20.9% 21.1% Core (Non-GAAP) 0.1% 0.2% Acquisitions (Non-GAAP) 0.5% 0.4% 2022 Adjusted Operating Profit Margin (Non-GAAP) 21.5% 2
Slide 14: Reconciliation of Net Earnings to Adjusted Net Earnings
RECONCILIATION OF NET EARNINGS TO ADJUSTED NET EARNINGS Three Months Ended Six Months Ended $ in millions July 1, 2022 July 2, 2021 July 1, 2022 July 2, 2021 Net Earnings (GAAP) $ 33.3 $ 82.3 $ 283.5 $ 173.3 Amortization of acquisition-related intangible assets 19.6 7.6 38.1 15.2 Restructuring costs
Slide 15: Reconciliation of Diluted EPS to Adjusted Diluted EPS
RECONCILIATION OF DILUTED NET EARNINGS PER SHARE TO ADJUSTED DILUTED NET EARNINGS PER SHARE Three Months Ended Six Months Ended July 1, 2022 July 2, 2021 July 1, 2022 July 2, 2021 Diluted Net Earnings per Share (GAAP) $ 0.21 $ 0.48 $ 1.73 $ 1.02 Amortization of acquisition-related intangible assets
Slide 16: Forecasted Adjusted Diluted Net Earnings Per Share
FORECASTED ADJUSTED DILUTED NET EARNINGS PER SHARE Three Months Ended Year Ended September 30, 2022 December 31, 2022 Low End High End Low End High End Forecasted Diluted Net Earnings Per Share $ 0.72 $ 0.77 $ 3.30 $ 3.40 Anticipated amortization of acquisition-related intangible assets 0.12 0.12 0.
Slide 17: Reconciliation of Operating Cash Flows to Free Cash Flow Conversion
RECONCILIATION OF OPERATING CASH FLOWS TO FREE CASH FLOW AND FREE CASH FLOW CONVERSION RATIO Three Months Ended Six Months Ended $ in millions July 1, 2022 July 2, 2021 % Change July 1, 2022 July 2, 2021 % Change Operating Cash Flows (GAAP) $ 7.2 $ 53.2 (86.5) $ 48.5 $ 216.5 (77.6)% Less: Purchases
Slide 18: Reconciliation of Operating Cash Flows to Adjusted Free Cash Flow
RECONCILIATION OF OPERATING CASH FLOWS TO ADJUSTED FREE CASH FLOW AND ADJUSTED FREE CASH FLOW CONVERSION RATIO Three Months Ended Six Months Ended $ in millions July 1, 2022 July 2, 2021 % Change July 1, 2022 July 2, 2021 % Change Operating Cash Flows (GAAP) $ 7.2 $ 53.2 (86.5)% $ 48.5 $ 216.5 (77.6
Slide 19: Components of Revenue Growth
COMPONENTS OF REVENUE GROWTH Components of Revenue Growth % Change Three Months Ended July 1, % Change Six Months Ended July 1, 2022 vs. Comparable 2021 Period 2022 vs. Comparable 2021 Period Total Revenue Growth (GAAP) 7.2 % 6.5 % Core revenue growth (Non-GAAP) 1.6 % 0.8 % Impact of acquisitions (N
Slide 20: Components of Revenue Growth by Platform
COMPONENTS OF REVENUE GROWTH BY PLATFORM % Change Three Months Ended July 1, 2022 vs. Comparable 2021 Period Components of Revenue Growth Mobility Technologies Diagnostics & Repair Technologies Total Revenue Growth (GAAP) 11.0 % (3.7) % Core revenue growth (Non-GAAP) 3.5 % (3.6) % Impact of acquisit
Slide 21: Net Leverage Ratio and Reconciliation to Adjusted EBITDA
NET LEVERAGE RATIO AND RECONCILIATION FROM NET EARNINGS TO EBITDA TO ADJUSTED EBITDA Total Debt $ 2,623.1 Less: Cash (127.4) Net Debt $ 2,495.7 Adjusted EBITDA (Non-GAAP) $ 754.7 Net Leverage Ratio 3.3 Six Months Ended Year Ended LTM $ in millions July 2, 2021 July 1, 2022 December 31, 2021 July 1,