Rockwell Automation, Inc. · NYSE:ROK

Rockwell Automation — Q1 FY2021 Earnings Presentation

29 slides from Rockwell Automation's earnings presentation, Jan 26, 2021

  1. Slide 1: First Quarter Fiscal Year 2021 Conference Call

    First Quarter Fiscal Year 2021 Conference Call January 26, 2021 PUBLIC 1

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement THIS PRESENTATION INCLUDES GUIDANCE AND OTHER 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, MANY OF WHICH

  3. Slide 3: Q1 FY21 Results Highlights

    Q1 FY21 Results Highlights ▪ Reported sales down (7.1)% YOY; acquisitions contributed 1.8% ▪ Closed Oylo cybersecurity and Fiix asset management software acquisitions ▪ Organic sales down (9.7)% YOY – Strong order intake; record backlog was up over 20% YOY – Information Solutions & Connected Service

  4. Slide 4: Q1 FY21 Organic Industry Segment Performance

    Q1 FY21 Organic Industry Segment Performance % of Q1 FY21 Q1 FY21 Sales vs. Q1 FY20 Q1 FY21 vs. Q1 FY20 Discrete Down mid single  Automotive down ~10% ~ 25% digits  Semiconductor up low single digits Hybrid  Food & Beverage up low single digits Up low single ~ 45%  Life Sciences up ~10% digits 

  5. Slide 5: Q1 FY21 Organic Sales Growth

    Q1 FY21 Organic Sales Growth NORTH AMERICA EMEA (10.6)% (7.8)% Q1 HIGHLIGHTS * • North America decline led by Oil & Gas and Auto; strong growth in Life Sciences and e-Commerce • EMEA decline driven by Oil & Gas ASIA PACIFIC and Metals; Food & Beverage strength led by packaging OEMs (7.1)% • Asia Pac

  6. Slide 6: FY21 Full Year Outlook Highlights

    FY21 Full Year Outlook Highlights ▪ Orders momentum in the first quarter expected to drive stronger growth in the balance of the year – Led by North America Life Sciences and e-Commerce ▪ Reported sales up 10% YOY at guidance midpoint; includes ~1.5% for acquisitions ▪ Organic sales up 6% YOY at gui

  7. Slide 7: FY21 Organic Industry Segment Outlook

    FY21 Organic Industry Segment Outlook % of FY21 B/(W) vs. Nov FY21 Sales vs. FY20 Assumptions at Guidance Mid-Point Guidance Discrete +  Automotive up ~10% ~ 25% Up ~10%  Semiconductor up high single digits Hybrid  Food & Beverage up mid single digits + Up high ~ 40%  Life Sciences up mid teens

  8. Slide 8: Q1 FY21 Key Financial Information

    Q1 FY21 Key Financial Information ($ in millions, except per share amounts) Q1 FY21 Q1 FY20 YOY B/(W) Organic Growth (9.7)% SALES Inorganic Growth +1.8 % $1,565 $1,685 Currency Translation +0.8 % Reported Growth (7.1)% SEGMENT OPERATING MARGIN 19.8% 20.1% -30 bps CORPORATE AND OTHER $28 $33 $5 ADJUS

  9. Slide 9: Q1 FY21 Segment Results

    Q1 FY21 Segment Results SALES SEGMENT OPERATING SEGMENT ($ in millions; YOY growth %) MARGIN HIGHLIGHTS Organic (7.9)% ▪ Lower segment margin YOY driven by lower sales, Intelligent partially offset by temporary and structural cost savings Devices Inorganic —% 19.4% $722M Currency +0.8 % (130) bps YO

  10. Slide 10: Q1 FY20 to Q1 FY21 Adjusted EPS Walk

    Q1 FY20 to Q1 FY21 Adjusted EPS Walk ~$0.45 ~$(0.25) ~$0.20 ~$(0.10) ~$(0.10) ~$0.05 $2.15 $1.93 $2.38 FY20 Q1 Core Temporary Incentive Tax Rate Acquisitions FY21 Q1 Legal FY21 Q1 Actions Compensation (excl. Interest) (excl. Legal Settlement Settlement) PUBLIC| Copyright ©2021 Rockwell Automation, I

  11. Slide 11: Monthly Product Order Trends: Sep'19 – Dec'20

    Monthly Product Order Trends: Sep’19 – Dec’20 Global Daily Average Product Orders $ Sep'19 Oct'19 Nov'19 Dec'19 Jan'20 Feb'20 Mar'20 Apr'20 May'20 Jun'20 Jul'20 Aug'20 Sep'20 Oct'20 Nov'20 Dec'20 Impact of large Independent Cart Technology order booked in September 2020 PUBLIC| Copyright ©2021 Rockw

  12. Slide 12: Quarterly Product Order Trends: Q1 FY20 – Q1 FY21

    Quarterly Product Order Trends: Q1 FY20 – Q1 FY21 Global Daily Average Product Orders $ Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21 Impact of large Independent Cart Technology order booked in September 2020 PUBLIC| Copyright ©2021 Rockwell Automation, Inc. | 12

  13. Slide 13: Updated FY21 Guidance

    Updated FY21 Guidance January November Guidance Guidance Sales Midpoint ~ $6.9B ~ $6.8B Organic Growth Range 4.5% - 7.5% 3.5% - 6.5% Inorganic Growth ~ 1.5% 1.0% - 1.5% Currency Translation ~ 2.5% ~ 1% Segment Operating Margin1 ~ 19.5% 20.0% - 20.5% Adjusted Effective Tax Rate ~ 14% ~ 14% Adjusted E

  14. Slide 14: FY21 November to January Guidance Midpoint Adjusted EPS Walk

    FY21 November to January Guidance Midpoint Adjusted EPS Walk ~$0.45 ~$(0.35) ~$0.05 ~$(0.10) ~$0.20 $8.90 $8.65 FY21 November Guidance Core FX Incentive Legal Incremental Investment & FY21 January Guidance at Midpoint Compensation Settlement Acquisitions at Midpoint (excl. Interest) PUBLIC| Copyrigh

  15. Slide 15: Accelerating FactoryTalk as a Service

    Accelerating FactoryTalk as a Service Focus of accelerated organic investments in FY21 PUBLIC| Copyright ©2021 Rockwell Automation, Inc. | 15

  16. Slide 16: Appendix Supplemental Financial Information

    Appendix Supplemental Financial Information and Reconcilations to Non-GAAP Measures 16

  17. Slide 17: New Operating Segments to Simplify and Accelerate Profitable Growth

    New Operating Segments to Simplify and Accelerate Profitable Growth 2020 Total Fiscal Year Sales and Product Available Market (PAM) $2.8B ARCHITECTURE ~$25B PAM & SOFTWARE SERVICES (10%) LIFECYCLE SERVICES $1.7B SOLUTIONS INTELLIGENT (24%) DEVICES $2.9B PRODUCTS (66%) SOFTWARE & CONTROL $1.7B ~$35B

  18. Slide 18: New Operating Segments Composition

    Former A&S business New Operating Segments Composition Former CP&S business Intelligent Devices Software & Control Lifecycle Services ▪ Drives ▪ Control software & hardware ▪ Consulting ▪ Motion ▪ Visualization software & hardware ▪ Professional services  Solutions ▪ Safety ▪ Digital twin & simulat

  19. Slide 19: Annual Recurring Revenue (ARR) Metric

    Annual Recurring Revenue (ARR) Metric EXAMPLES • Adopting ARR as our measure for recurring revenue Software SaaS • Provides increased focus on generating subscriptions more predictable revenue streams Perpetual software • ARR added as an element of maintenance incentive compensation plans in FY21 Co

  20. Slide 20: Q1 FY21 Results: Summary

    Q1 FY21 Results: Summary ($ in millions, except per share amounts) Q1 2021 Q1 2020 Total Sales $ 1,565.3 $ 1,684.5 Total segment operating earnings $ 309.3 $ 339.1 Purchase accounting depreciation and amortization (11.7) (10.0) Corporate and other (28.0) (32.8) Non-operating pension and postretireme

  21. Slide 21: Free Cash Flow

    Free Cash Flow ($ in millions) Q1 2021 Q1 2020 Net Income $ 590 $ 315 Depreciation/Amortization 44 42 Retirement Benefits Expense 30 32 Receivables/Inventory/Payables (105) (84) Compensation and Benefits 7 (39) Pension Contributions (9) (7) Income Taxes 73 (17) Change in fair value of investments1 (

  22. Slide 22: Industry Segmentation

    Industry Segmentation % of FY20 Sales Discrete Hybrid Process ~10% Automotive ~20% Food & Beverage ~10% Oil & Gas ~5% Semiconductor ~5% Life Sciences ~5% Mining, Aggregates & ~5% Household & Personal Care Cement ~5% General Industries ~5% Tire ~5% Metals • Warehousing & Logistics • Printing & Publis

  23. Slide 23: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Organic Sales ($ in millions) Three Months Ended December 31, 2020 2019 Reported Acquisition Currency Effect of Sales Growth Growth Growth Organic Growth Effect of Changes in Organic (Decline) (Decline) (Decline) (Decline) Sales(a) Acquisitions(e) Currency(d) Sale

  24. Slide 24: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Segment Operating Margin ($ in millions) Three Months Ended December 31, 2020 December 31, 2019 Sales Intelligent Devices (a) $ 721.7 $ 776.6 Software & Control (b) 441.0 452.5 Lifecycle Services (c) 402.6 455.4 Total sales (d) $ 1,565.3 $ 1,684.5 Segment operatin

  25. Slide 25: 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 December 31, 2020 December 31, 2019 Net Income attributable to Rockwell Automation $ 593.3 $ 310.7 Non-operating pension and postretirement

  26. Slide 26: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Return On Invested Capital ($ in millions) Twelve Months Ended December 31, 2020 2019 (a) Return Net income $ 1,298.2 $ 930.9 Interest expense 99.7 103.9 Income tax provision 204.0 183.9 Purchase accounting depreciation and amortization 43.1 22.5 Return 1,645.0 1,

  27. Slide 27: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Fiscal 2021 Guidance ($ in billions, except per share amounts) Organic Sales Fiscal 2021 Guidance Organic sales growth 4.5% - 7.5% Inorganic sales growth ~ 1.5% Foreign currency impact ~ 2.5% Reported sales growth 8.5% - 11.5% Segment Operating Margin Total sales

  28. Slide 28: New Definition of Adjusted Income and Adjusted EPS

    New Definition of Adjusted Income and Adjusted EPS • Beginning in fiscal 2021, Rockwell is changing its definition of Adjusted Income and Adjusted EPS • New definition will also exclude the impact of purchase accounting depreciation and amortization expense attributable to Rockwell Automation and th

  29. Slide 29: Thank you

    Thank you www.rockwellautomation.com 29

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