Mueller Water Products · NYSE:MWA

Mueller Water Products — Baird's Global Industrial Conference 2017

30 slides from Mueller Water Products's conference presentation, Nov 7, 2017

  1. Slide 1: Where Intelligence Meets Infrastructure

    Where Intelligence Meets Infrastructure F E B R U A R Y 2 0 1 7 M U E L L E R W A T E R P R O D U C T S . C O M Baird’s Global Industrial Conference November 8, 2017

  2. Slide 2: Non-GAAP Financial Measures

    PAGE 2 NON-GAAP Financial Measures M U E L L E R W A T E R P R O D U C T S . C O M 2 N O V E M E B R 2 0 1 7 In an effort to provide investors with additional information regarding its results as determined by GAAP, the Company also provides non-GAAP information that management believes is useful to

  3. Slide 3: Forward-looking Statements

    This presentation contains certain statements that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements that address activities that may occur in the future are forward-looking statements. The words “projected,” “design

  4. Slide 4: Reclassified Financials and Renamed Segments

    Reclassified Financials  We sold Anvil in January 2017  As a result, Anvil's operating results for all prior periods, and the gain from its sale, have been classified as discontinued operations  Mueller Co. is now called Infrastructure  Mueller Technologies is now called Technologies PAGE 4 M U

  5. Slide 5: Investment Highlights

    Investment Highlights M U E L L E R W A T E R P R O D U C T S . C O M 5 N O V E M E B R 2 0 1 7 Market opportunity is substantial and growing Restoring and expanding existing water systems to serve growing populations through 2050 require a $1.7 trillion investment, according to the American Water W

  6. Slide 6: Our Company and Markets

    Our Company and Markets

  7. Slide 7: MWP at a Glance

    MWP at a Glance M U E L L E R W A T E R P R O D U C T S . C O M 7 N O V E M E B R 2 0 1 7 100% Municipal spending 60% Repair and replacement of municipal water distribution and treatment systems 30% Residential construction 10% Natural gas utilities as of September 30, 2017 ($ in Millions) Net Sales

  8. Slide 8: Our Leading Product Positions

    Our Leading Product Positions M U E L L E R W A T E R P R O D U C T S . C O M 8 #1 PRODUCT POSITION #1 PRODUCT POSITION #1 PRODUCT POSITION #2 PRODUCT POSITION Company estimates based on internal analysis and information from trade associations and distributor networks, where available. N O V E M E

  9. Slide 9: Bringing Value to our Customers

    Bringing Value to our Customers  Providing valued products and services to over 50,000 municipalities and utilities  Utilizing proprietary smart technologies to help our customers actively diagnose, monitor and control the delivery of drinking water  Developing new technology offerings which util

  10. Slide 10: U.S. Water Infrastructure Requires Substantial Long-Term Investment

    U.S. Water Infrastructure Requires Substantial Long-Term Investment M U E L L E R W A T E R P R O D U C T S . C O M 1 0 Repair & Replacement Market (1) American Water Works Association, Buried No Longer: Confronting America’s Water Infrastructure Challenge 2012 (2) ASCE: 2017 Report Card for America

  11. Slide 11: Funding Water Infrastructure Repair

    -50 50 150 250 350 450 550 19 54 19 57 19 60 19 63 19 66 19 69 19 72 19 75 19 78 19 81 19 84 19 87 19 90 19 93 19 96 19 99 20 02 20 05 20 08 20 11 20 14 20 17 CPI Water CPI Nat Gas CPI Postage CPI Electricity CPI All Items Funding Water Infrastructure Repair Historical Water Rates Compared to Other

  12. Slide 12: Bringing Intelligence to Water Infrastructure: Water Conservation

    Bringing Intelligence to Water Infrastructure Water Conservation M U E L L E R W A T E R P R O D U C T S . C O M 1 2 Customer Service Focus  Awareness/education  Ongoing monitoring  Sustainability  11% of U.S. experiencing drought or abnormally dry conditions(1)  240,000 water main breaks per y

  13. Slide 13: Bringing Intelligence to Water Infrastructure

    Bringing Intelligence to Water Infrastructure M U E L L E R W A T E R P R O D U C T S . C O M 1 3  Provide longer-range AMI systems  Manage water service remotely  Detect leaks  Increase education and customer service with consumer portal  Detect leaks on fixed transmission and distribution mai

  14. Slide 14: Execution & Business Results

    Execution & Business Results

  15. Slide 15: Execution and Business Results

    Execution and Business Results  Reorganized the Company around product value streams  Implemented cost savings to fund investments in manufacturing and new product development  Divested Anvil and U.S. Pipe  Implemented Lean Six Sigma and other manufacturing improvements:  Increased production c

  16. Slide 16: Q4 2017 Consolidated Financial Highlights

     Delivered 7.5 percent net sales growth in Infrastructure  Increased overall consolidated net sales 5.2 percent due to volume growth, pricing and the addition of Singer Valve to Infrastructure portfolio, partially offset by lower volume in Technologies' meter business  Achieved increased pricing

  17. Slide 17: Capital Allocation

    PAGE 17 Capital Allocation M U E L L E R W A T E R P R O D U C T S . C O M 1 7 N O V E M E B R 2 0 1 7 Acquisitions Share Repurchases Internal Cap Ex & New Product Investments Dividends Debt Reduction Historical  Reduced debt by $1 Billion since 2006  Acquired Singer Valve to enter control valve m

  18. Slide 18: Company Debt Structure

    $1,549 $1,127 $1,101 $1,096 $740 $692 $678 $623 $601 $546 $489 $484 $480 $0 $300 $600 $900 $1,200 $1,500 $1,800 Company Debt Structure M U E L L E R W A T E R P R O D U C T S . C O M 1 8 ■ Net debt leverage less than 1x down from a peak of more than 6x ■ No significant required principal payments on

  19. Slide 19: Why Invest in MWA?

    Why Invest in MWA? M U E L L E R W A T E R P R O D U C T S . C O M 1 9  Aging infrastructure driving need for investment  Increasing public awareness of the need to upgrade water infrastructure  Limited number of end-market suppliers  Growing residential construction market  Increased need for

  20. Slide 20: Supplemental Data

    . Supplemental Data

  21. Slide 21: Segment Results and Reconciliation of GAAP to Non-GAAP Performance Measures

    SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES PAGE 21 Quarter ended September 30, 2017 Infrastructure Technologies Corporate Total (in millions, except per share amounts) Net sales $ 204.4 $ 22.5 $ — $ 226.9 Gross profit $ 76.2 $ 4.7 $ — $ 80.9 Selling, general and admi

  22. Slide 22: Segment Results and Reconciliation of GAAP to Non-GAAP Performance Measures

    SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES PAGE 22 Quarter ended September 30, 2017 Infrastructure Technologies Corporate Total (in millions, except per share amounts) Net income $ 19.3 Plus loss from discontinued operations 0.8 Interest expense, net (1) 5.2 Income t

  23. Slide 23: Segment Results and Reconciliation of GAAP to Non-GAAP Performance Measures

    SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES PAGE 23 Quarter ended September 30, 2016 Infrastructure Technologies Corporate Total (in millions, except per share amounts) Net sales $ 190.1 $ 25.5 $ — $ 215.6 Gross profit $ 71.5 $ 6.3 $ — $ 77.8 Selling, general and admi

  24. Slide 24: Segment Results and Reconciliation of GAAP to Non-GAAP Performance Measures

    SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES PAGE 24 Quarter ended September 30, 2016 Infrastructure Technologies Corporate Total (in millions, except per share amounts) Net income $ 26.5 Less income from discontinued operations (6.7 ) Interest expense, net (1) 5.6 Inc

  25. Slide 25: Segment Results and Reconciliation of GAAP to Non-GAAP Performance Measures

    SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES PAGE 25 Year ended September 30, 2017 Infrastructure Technologies Corporate Total (in millions, except per share amounts) Net sales $ 739.9 $ 86.1 $ — $ 826.0 Gross profit $ 259.5 $ 8.0 $ — $ 267.5 Selling, general and admin

  26. Slide 26: Segment Results and Reconciliation of GAAP to Non-GAAP Performance Measures

    SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES PAGE 26 Year ended September 30, 2017 Infrastructure Technologies Corporate Total (in millions, except per share amounts) Net income $ 123.3 Less income from discontinued operations (69.0 ) Interest expense, net (1) 22.2 Inc

  27. Slide 27: Segment Results and Reconciliation of GAAP to Non-GAAP Performance Measures

    SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES PAGE 27 Year ended September 30, 2016 Infrastructure Technologies Corporate Total (in millions, except per share amounts) Net sales $ 715.7 $ 84.9 $ — $ 800.6 Gross profit $ 250.7 $ 17.2 $ — $ 267.9 Selling, general and admi

  28. Slide 28: Segment Results and Reconciliation of GAAP to Non-GAAP Performance Measures

    SEGMENT RESULTS AND RECONCILIATION OF GAAP TO NON-GAAP PERFORMANCE MEASURES PAGE 28 Year ended September 30, 2016 Infrastructure Technologies Corporate Total (in millions, except per share amounts) Net income $ 63.9 Less income from discontinued operations 18.8 Interest expense, net (1) 23.6 Income

  29. Slide 29: History of Strong Financial Performance

    2 9 HISTORY OF STRONG FINANCIAL PERFORMANCE Net Sales Adjusted EBITDA(1) & Adjusted EBITDA Margin (1) Infrastructure adjusted EBITDA excludes (in millions) purchase accounting adjustments of $52.9 in 2006, goodwill and other impairment charges of $818.7 in 2009 and other charges of $0.1 in 2010, $1.

  30. Slide 30: Questions

    Questions

Mueller Water Products — Baird's Global Industrial Conference 2017 on 6ix