Chart Industries, Inc. · NYSE:GTLS
Chart Industries — Investor Day (June 2018)
105 slides from Chart Industries's investor day presentation, Jun 7, 2018
Slide 1: Investor Day – June 7, 2018
Investor Day – June 7, 2018 © 2018 Chart Industries, Inc. Confidential and Proprietary © 2018 Chart Industries, Inc. Confidential and Proprietary
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements made in this presentation are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning Chart Industries’ plans, objectives, future orders, revenues, ma
Slide 3: Today's Agenda
Today’s Agenda Topic Speaker William C. Johnson, CEO & Overview and Strategic Priorities Jillian C. Evanko, CFO Energy & Chemicals Andy Moriarty, President Distribution & Storage Bill Haukoos, President BioMedical Earl D. Lawson, President Financial Strategy and Outlook Jillian C. Evanko, CFO Q&A Pr
Slide 4: Overview and Strategic Priorities
Overview and Strategic Priorities William C. Johnson, CEO Jillian C. Evanko, CFO © 2018 Chart Industries, Inc. Confidential and Proprietary 3
Slide 5: Leading Supplier of Mission Critical Equipment
Leading Supplier of Mission Critical Equipment 1 Energy & Chemical 2 Distribution & Storage 3 BioMedical . Supply Brazed Aluminum Heat Exchangers (BAHX), . Offer a complete portfolio of cryogenic distribution and . Serve as end-to-end provider of respiratory therapy Air Cooled Heat Exchangers (ACHX)
Slide 6: Broad End-Market Exposure: Sales by Geography
Broad End-Market Exposure Sales by Geography* $226M $540M $223M $989M 6% 8% 12% 7% 4% 2% 9% 19% 16% 17% 4% 26% 22% 30% 75% 49% 53% 41% E&C D&S BioMed Total Rest of World Middle East Europe Asia United States © 2018 Chart Industries, Inc. Confidential and Proprietary * FY 2017 as per SEC filings 5
Slide 7: Broad End-Market Exposure: Sales by Industry & Highlights
Broad End-Market Exposure Sales by Industry & Highlights * 1 Energy & Chemical 2 Distribution & Storage 3 BioMedical Natural Gas Processing/ Manufacturing/ Fabrication Petrochemical HVAC, power and Healthcare refining 58% 55% 9% Electronics Industrial 5% Environ- 10% 10% 68% $226M Gas $540M $223M me
Slide 8: Dynamic Market Participants
Dynamic Market Participants E&C D&S BAHX: U.S.: ACHX: EUROPE: FANS: CHINA: BioMedical OXYGEN: CRYOBIO: © 2018 Chart Industries, Inc. Confidential and Proprietary 7
Slide 9: Track Record of Execution
Track Record of Execution Increased inorganic and Deployed capital toward four organic sales by 15% transformational acquisitions and 5%, respectively(1) Delivered on FY 2017 Realized synergies guidance objectives ahead of schedule Optimized shared Refinanced convertible service project launched deb
Slide 10: Portfolio Transformation
Portfolio Transformation © 2018 Chart Industries, Inc. Confidential and Proprietary 9
Slide 11: Operations Spanning the Gas to Liquids Cycle
Operations Spanning the Gas to Liquids Cycle Exploration, Value Processing/ Re- Lifecycle Production & Treatment Transportation Storage Proposition/ Pipeline Liquefaction gasification Services Application ACHX Orca Microbulk Engineered Tanks Ambient Vaporizers Installation & Startup N2 Dosing Cold B
Slide 12: 5-Year History of Portfolio-Shaping Acquisitions
5-Year History of Portfolio-Shaping Acquisitions Exploration, Value Processing/ Re- Lifecycle Production & Treatment Transportation Storage Proposition/ Pipeline Liquefaction gasification Services Application Xinye $18.0M Wuxi $9.5M $1.5M $22.0M $27.0M $4.3M $205M $8.4M
Slide 13: Hudson: Strategic Rationale
Hudson: Strategic Rationale . Adds highly-complementary Fans Product Split* End Market Split* Aftermarket Split* business Chemical Industrial / 6% . Strengthens aftermarket presence LNG Aftermarket Fans Other / OEM 22% 37% . Consistent with core strategy to enhance 38% HVAC 63% Air Cooled Heat Excha
Slide 14: Hudson: Key Products
Hudson: Key Products Air-Cooled Heat Exchanger Axial Flow Cooling Aftermarket Sales & Support (“ACHE”) (“Fans”) (“Aftermarket”) Illustrative Products / Services Hudson Fin-Fan brand includes highly Tuf-Life brand fans are made from corrosion Provides customers with a variety of specialized ACH
Slide 15: Hudson: Enhanced Energy Offering
Hudson: Enhanced Energy Offering Exploration, Value Processing/ Re- Lifecycle Production & Treatment Transportation Storage Proposition/ Pipeline Liquefaction gasification Services Application ACHX Orca Microbulk Engineered Tanks Ambient Vaporizers Installation & Startup N2 Dosing Cold Boxes Trailer
Slide 16: Expanding Operational and Geographic Coverage
Expanding Operational and Geographic Coverage Exploration, Value Processing/ Re- Lifecycle Production & Treatment Transportation Storage Proposition/ Pipeline Liquefaction gasification Services Application Current Chart Service Locations VCT Vogel D&S Canton Current Location and Regional . Direct co
Slide 17: Oxygen-Related Product Strategic Review
Oxygen-Related Product Strategic Review . Conducting strategic review and evaluation of possible divestiture of the oxygen- related product lines within Biomedical segment . Excludes those portions of the BioMedical segment that utilize and align with our cryogenic technological expertise (Cryobiolo
Slide 18: Strategic Priorities for Enhanced Growth
Strategic Priorities for Enhanced Growth © 2018 Chart Industries, Inc. Confidential and Proprietary 17
Slide 19: Competitive Differentiators
Competitive Differentiators Valued Global Exemplary Leading Operational Engineering Reach Service Technology Excellence and Design Strategically located Best-in-class Superior cryogenic Fostering a culture Continuous innovation manufacturing aftermarket service two-phase flow that strives for creati
Slide 20: Building Blocks of Our 3-Year Strategy
Building Blocks of Our 3-Year Strategy 3 Achieve financial targets 2 Deliver profitable growth through strategic initiatives 1 Take advantage of favorable macro trends Predictable, Disciplined and Profitable Growth © 2018 Chart Industries, Inc. Confidential and Proprietary 19
Slide 21: Take Advantage of Favorable Macro Trends
1 Take Advantage of Favorable Macro Trends Market Dynamics Chart Exploitation . Supply / demand for LNG needs in . Chart’s patented IPSMR 2022-2023 and shift toward modular technology is key to mid-scale facilities technology . Increasing regulatory environment . Chart’s customer intimacy drives eng
Slide 22: Delivering Profitable Growth through Strategic Initiatives
Delivering Profitable Growth through 2 Strategic Initiatives STRENGTHEN INVEST IN PRODUCT CORE INNOVATION & CAPABILITIES EXPANSION REDUCE COSTS CAPTURE THROUGH ADDITIONAL OPERATIONAL MARKET SHARE EXCELLENCE © 2018 Chart Industries, Inc. Confidential and Proprietary 21
Slide 23: Strengthen Core Capabilities and Offerings
2 Strengthen Core Capabilities and Offerings BioMedical Energy & Chemicals Distribution & Storage CryoBio Respiratory Revenue:$226M Revenue: $540M Revenue: $77M Revenue: $146M Common attributes across the Chart family of businesses Innovation-Driven Leading Market Solve Key High Technology Replaceme
Slide 24: Product Innovation & Development
2 Product Innovation & Development E&C D&S BioMed …Next Gen, …PD Pumps, …Portables, predictive enhancing addressing consumer maintenance, technologies ergonomic needs optimization …Nitrogen, …Insulation, new …BAHX, disruptive applications, first solutions to leveraging on-board protect our technolog
Slide 25: Accelerate Growth through Acquisitions
2 Accelerate Growth through Acquisitions Acquisition Criteria: Prioritize Key Market Opportunities: . Strong level of strategic fit . High degree of leveragability (specific and attainable CRYOBIO SERVICE & synergies) TEMPERATURE REPAIR . Proven growth and profitability EXPANSION BUILDOUT OFFERING .
Slide 26: Reduce Cost through Operational Excellence
2 Reduce Cost through Operational Excellence Cost Reduction Across Various Areas Products Manufacturing Facility Back Office © 2018 Chart Industries, Inc. Confidential and Proprietary 25
Slide 27: Achieve 2021 Financial Targets
3 Achieve 2021 Financial Targets ~ 40+% 700bps 21% Revenue Growth to $1.7B Operating Margin Expansion to ~17% of Sales from Aftermarket from 13% . Leading Positions Across the Portfolio . Well-Balanced Portfolio of Long-Cycle and Short-Cycle Products . Consistent Growth in Operating Income, EPS and
Slide 28: Maximize Top Line Organic Growth
3 Maximize Top Line Organic Growth 7% Chart Industries 2021 Revenue CAGR E&C D&S BioMed 8% 6% 8% Revenue CAGR Revenue CAGR Revenue CAGR © 2018 Chart Industries, Inc. Confidential and Proprietary 27
Slide 29: 3-Year P&L Base Case
3 3-Year P&L Base Case ($ in billions) 7% Sales Growth CAGR 10% Gross Profit CAGR 21% Operating Income CAGR $1.5 $0.4 $0.2 $0.3 30.6% 13.0% $1.2 $0.1 28.6% 9.1% 2018 2021 2018 2021 2018 2021 Strong Market Market Share Productivity & Strategic Inorganic Growth Gain GM Execution Investments © 2018 Cha
Slide 30: 3-Year P&L with Large LNG Project
3 3-Year P&L with Large LNG Project ($ in billions) 12% Sales Growth CAGR 17% Gross Profit CAGR 38% Operating Income CAGR $1.7 $0.5 $0.3 $0.3 32.4% 17.0% $1.2 $0.1 28.6% 9.1% 2018 2021 2018 2021 2018 2021 Strong Market Market Share Productivity & Strategic Inorganic Large LNG Growth Gain GM Executio
Slide 31: Chart Investment Highlights
Chart Investment Highlights Leading diversified industrial global manufacturer with diverse Operate in attractive, growing and broad product offering markets Innovative technical expertise Cross-operating segment scale and reputation and collaboration Longstanding relationships with industry leading
Slide 32: Energy & Chemicals Segment
Energy & Chemicals Segment Andy Moriarty, President © 2018 Chart Industries, Inc. Confidential and Proprietary 31
Slide 33: Leading Supplier of Mission Critical Equipment
Leading Supplier of Mission Critical Equipment 1 Energy & Chemical 2 Distribution & Storage 3 BioMedical . Supply Brazed Aluminum Heat Exchangers (BAHX), . Offer a complete portfolio of cryogenic distribution and . Serve as end-to-end provider of respiratory therapy Air Cooled Heat Exchangers (ACHX)
Slide 34: Strategic Growth Initiatives
Strategic Growth Initiatives Strengthen Invest In Product Reduce Costs Capture Core Innovation & Through Operational Additional Capabilities Expansion Excellence Market Share . Expand larger single unit core . IPSMR® technology now available . BAHX cost reduction . LNG market development, capability
Slide 35: Serving Energy Markets Globally
Serving Energy Markets Globally E&C FY 2016 Sales of $154M E&C FY 2017 Sales of $226M Natural Gas Natural Gas Processing/ Processing/ Petrochemical Petrochemical Asia Middle HVAC, 16% East power and Asia 23% refining 68% Industrial 9% 9% Gas Europe 7% Industrial 4% 10% Middle Industry 68% Gas Region
Slide 36: Connecting the Entire LNG Value Chain
Connecting the Entire LNG Value Chain Liquefaction, distribution, storage and end-use – our decades of experience in LNG solutions delivers to customers - safe, reliable and affordable projects that deliver natural gas to every end use application. Liquefaction Distribution Storage End-Use © 2018 Ch
Slide 37: Connecting the Entire LNG Value Chain - Liquefaction
Connecting the Entire LNG Value Chain - Liquefaction Transportation Marine Regasification Onshore Production Liquefaction End User Processing & Storage Transportation & Storage Transportation Liquefaction: Major Mechanical Process Components: The refrigeration of processed gas to liquid, enabling co
Slide 38: Connecting the Entire LNG Value Chain - Marine Transportation
Connecting the Entire LNG Value Chain - Liquefaction Transportation Marine Regasification Onshore Production Liquefaction End User Processing & Storage Transportation & Storage Transportation Marine Transportation: Major Components: LNG tankers are the primary transport . Loading and Transfer System
Slide 39: Connecting the Entire LNG Value Chain – Regasification & Storage
Connecting the Entire LNG Value Chain – Regasification & Storage Transportation Marine Regasification Onshore Production Liquefaction End User Processing & Storage Transportation & Storage Transportation Regasification & Storage: Major Mechanical Process Components: An industrial heater that returns
Slide 40: Bridging the Energy Gap
Bridging the Energy Gap Chart is key in the development of both midscale and small-scale liquefaction models that are revolutionizing the LNG landscape. It’s an exciting and transient landscape where decisions in different parts of the value chain are highly interdependent. Chart understands this an
Slide 41: Principal Energy Products & Solutions
Principal Energy Products & Solutions Cold Boxes Technology LNG & NGL Heat Exchangers Heat Brazed Aluminum BrazedAluminum Storage Solutions Exchangers LNG Fueling Distribution & Air Heat Air Cooled Through our technology and proprietary equipment, we are at the forefront of responding to energy chal
Slide 42: Small- and Mid-Scale Liquefaction
Small- and Mid-Scale Liquefaction 4285 tpd 150 tpd Standard Plants 750 tpd Modular Plants 165 tpd 400 tpd 750 tpd 0.5 to 1.5 MMTPA modules 100,000 gpd 250,000 gpd 450,000 gpd 900,000 to 2,700,000 gpd . Key equipment standardization and major component modularization . Maximized shop fabrication for
Slide 43: Leveraging Our Proven & Proprietary Process Technology
Leveraging Our Proven & Proprietary Process Technology IPSMR® is more efficient than other single mixed refrigerant processes. Chart’s IPSMR® process technology provides all the benefits of a mid-scale LNG solution together with base-load reliability and efficiencies to deliver substantially lower c
Slide 44: Small-Scale Liquefaction
Small-Scale Liquefaction . ‘Off the shelf’ designs, pre-packaged and proven gas compression equipment and front end gas processing units . 3 plant solutions with capacities from 100,000 gallons per day (165 tpd) to 450,000 gallons per day (750 tpd) . Maximized shop fabrication, minimized field const
Slide 45: Mid-Scale Liquefaction
Mid-Scale Liquefaction . Train capacities to match maximum owner selected gas turbine power output, making identical, ideal train sizes using standard components . Plant configuration options and flexibility, for optimal layout and plot utilization for maximum LNG production . IPSMR® midscale soluti
Slide 46: Connecting the Entire LNG Value Chain – Distribution
Connecting the Entire LNG Value Chain – Distribution Liquefaction, distribution, storage and end-use – our decades of experience in LNG solutions delivers to customers - safe, reliable and affordable projects that deliver natural gas to every end use application. Liquefaction Distribution Storage En
Slide 47: Mobile Distribution
Mobile Distribution Most comprehensive distribution solutions including fixed bodies, semi-trailers and trailers together with rail cars. . Chart Vacuum Technology® . Solutions for road and rail . Manufacturing in North America, Europe and China . Lightweight design for reduced operating expenditure
Slide 48: Connecting the Entire LNG Value Chain – Storage
Connecting the Entire LNG Value Chain – Storage Liquefaction, distribution, storage and end-use – our decades of experience in LNG solutions delivers to customers - safe, reliable and affordable projects that deliver natural gas to every end use application. Liquefaction Distribution Storage End-Use
Slide 49: Cryogenic Storage Vessels
Cryogenic Storage Vessels Complete range of horizontal and vertical cryogenic storage tanks from the smallest standard units to the "Děčínské Giants", the world’s largest. Chart’s HT1000 provides sufficient energy to meet the average family’s demand for >500 years. © 2018 Chart Industries, Inc. Conf
Slide 50: Connecting the Entire LNG Value Chain – End Users
Connecting the Entire LNG Value Chain – End Users Liquefaction, distribution, storage and end-use – our decades of experience in LNG solutions delivers to customers - safe, reliable and affordable projects that deliver natural gas to every end use application. Liquefaction Distribution Storage End-U
Slide 51: Regasification Stations & Terminals
Regasification Stations & Terminals Chart delivers major infrastructure projects that enable offloaded LNG to be used for marine bunkering, and distribution via road, sea or marine along with re-gasification for local energy needs. Chart Vacuum Insulated Pipework significantly Chart designed, built,
Slide 52: LNG Satellite Stations for Power
LNG Satellite Stations for Power Chart satellite stations are a fully independent energy resource enabling off-grid and remote locations to convert to natural gas. Pre-Engineered Modules: . Designed for ease of installation . Reduce on-site efforts during critical construction time . Eliminate fight
Slide 53: Significant Opportunities for FID in 2018/2019
Chart Significant Opportunities for FID in 2018/2019 (Does not include Hudson) Project Opportunity Chart Customer Operator Country Capacity Driftwood LNG Bechtel Tellurian USA 26 MTPA Calcasieu Pass GE Venture Global USA 10 MTPA Corpus Christi, TX KBR/Siemens Cheniere USA 9.5 MTPA Confidential North
Slide 54: Brazed Aluminum Heat Exchangers Wisconsin Expansion
Brazed Aluminum Heat Exchangers Wisconsin Expansion: Meeting the Market Demands . 33% capacity increase – targeted at the LNG and Petrochemical markets . World’s largest vacuum brazing furnace . Drives greater heat exchanger efficiency and design optimization Reduced lead times and manufacturing lar
Slide 55: Next Generation BAHX
Next Generation BAHX Cap Sheet Smart Layer™ is a predictive Side Bar Smart Layer Side Bar maintenance solution that enables Parting Sheet operators to avoid emergency shutdowns Side Bar Outermost Active Layer Side Bar Optimized Reboiler Design & Construction with a focus on plant optimization and ma
Slide 56: Air Cooled Heat Exchangers
Air Cooled Heat Exchangers The acquisition of . Natural Gas Processing . Oil & Gas Transmission Hudson Products . Petrochemical perfectly complements . Refining our air cooled heat . Power Generation exchanger business . Geothermal . LNG Liquefaction & and diversifies our Vaporization portfolio into
Slide 57: Chart Lifecycle, Inc.
Chart Lifecycle, Inc. Dedicated to offering a level of service through the entire project lifecycle and is focused on the optimized performance and lifespan of Chart proprietary equipment. “An ounce of prevention is worth a pound of cure” – Benjamin Franklin © 2018 Chart Industries, Inc. Confidentia
Slide 58: Distribution & Storage
Distribution & Storage Bill Haukoos, President © 2018 Chart Industries, Inc. Confidential and Proprietary 57
Slide 59: Leading Supplier of Mission Critical Equipment
Leading Supplier of Mission Critical Equipment 1 Energy & Chemical 2 Distribution & Storage 3 BioMedical . Supply Brazed Aluminum Heat Exchangers (BAHX), . Offer a complete portfolio of cryogenic distribution and . Serve as end-to-end provider of respiratory therapy Air Cooled Heat Exchangers (ACHX)
Slide 60: Product Portfolio
Product Portfolio Chart’s Carbo-series is the industry benchmark for beverage carbonation. Energy In 2016 Chart celebrated 20 years of the Orca®. Industrial Chart’s HT1000 provides sufficient energy to meet the average family’s demand for >500 years. Chart’s mobile units are MicroBulk is a total sol
Slide 61: Aftermarket Services
Aftermarket Services Enabling our customers to maximize their assets by providing a level of service through the entire lifecycle of our products focused on optimized performance and longevity. Expected lifecycle – 50 years Energy Major refurbishment – 8 years Schedule service – 2 years ExpectedIndu
Slide 62: Full Systems Integration
Full Systems Integration Resolving cryogenic engineering challenges that enable our customers to develop their markets. Energy A healthcare facility selected Chart to provide a complete system to provide a secure source of medical grade oxygen. In addition to increased security and safety of supply,
Slide 63: Alternative Fueling (LNG)
Alternative Fueling (LNG) Natural gas fueled vehicles and marine vessels will help reduce the carbon intensity of the energy system and contribute to improved air quality. Energy Chart collaborates with the major truck OEMs to develop fuel tanks for their LNG fueled vehicles. Global policies to cut
Slide 64: Diversity Product Portfolio (Distribution & Storage)
Diversity Product Portfolio (Distribution & Storage) D&S FY 2016 Sales of $497M D&S FY 2017 Sales of $540M Manufacturing/ Manufacturing/ Fabrication Europe Fabrication Europe 59% 22% 58% 26% Asia Asia 18% ROW ROW 7% 19% 6% Industry Region Industry Region 7% 8% 5% 22% Healthcare 22% 7% 53% 5% 49% Ele
Slide 65: Operations Spanning the Gas to Liquids Cycle
Operations Spanning the Gas to Liquids Cycle Exploration, Value Processing/ Re- Lifecycle Production & Treatment Transportation Storage Proposition/ Pipeline Liquefaction gasification Services Application ACHX Orca Microbulk Engineered Tanks Ambient Vaporizers Installation & Startup N2 Dosing Cold B
Slide 66: Attractive Industrial Gas and LNG D&S Equipment Market
Attractive Industrial Gas (IG) and LNG D&S Equipment Market Addressable IG and LNG D&S equipment market size by region, 2016 Millions of dollars $635M $435M $295M 100 $55M $65M 80 $360M The addressable industrial gas (IG) and LNG D&S equipment 60 market is ~$1.4B; Asia is the $380M largest market 40
Slide 67: IG and D&S Equipment Market Positioned for Continued Growth
IG and D&S Equipment Market is Positioned for Continued Growth Addressable IG D&S equipment market*, 2016-20F Addressable LNG D&S equipment market, 2016-20F Millions of dollars Millions of dollars CAGR% CAGR% 1,400 800 2016-20F 2016-20F 1,200 1,040 Total 4% Total 4% The IG and LNG 998 600 1,000 959
Slide 68: Strategic Growth Opportunities
Strategic Growth Opportunities © 2018 Chart Industries, Inc. Confidential and Proprietary 67
Slide 69: Strategic Growth Initiatives
Strategic Growth Initiatives Strengthen Invest In Product Reduce Costs Capture Core Innovation & Through Operational Additional Capabilities Expansion Excellence Market Share . Capture application based . Accelerate growth via new . Lower costs via China plant . IG: Strengthen existing opportunities
Slide 70: Roadmap to Drive Growth in Key Applications
Roadmap to Drive Growth in Key Applications Existing applications New applications Market Market Description Action item Description Action item Potential Potential Pursue projects in areas with Monitor the market and target the less oil price sensitivity (Europe, CNG fueling ~$70M appropriate entry
Slide 71: Deep New Product Pipeline
Deep New Product Pipeline Hydrogen Transport & Hydrogen On-site Storage Delivery Solutions (Microbulk) (Trailers / Microbulk) 20+ products Expanded Nitrogen CO2 Storage & Delivery in the Solutions (Bulk / Skidded) (Trifecta) pipeline © 2018 Chart Industries, Inc. Confidential and Proprietary 70
Slide 72: Focus on Long Term & Transformative R&D
Focus on Long Term & Transformative R&D Category Description Product lines effected Cartridge style positive . Enhanced pump technologies that support the movement of liquids and vapor . High pressure system displacement (PD) pump and allow for high pressure applications to be supplied by low pressu
Slide 73: Reduce Cost through Operational Excellence
Reduce Cost through Operational Excellence Cost Reduction Across Various Areas Products Manufacturing Facility Back Office © 2018 Chart Industries, Inc. Confidential and Proprietary 72
Slide 74: BioMedical
BioMedical Earl D. Lawson, President © 2018 Chart Industries, Inc. Confidential and Proprietary 73
Slide 75: Leading Supplier of Mission Critical Equipment
Leading Supplier of Mission Critical Equipment 1 Energy & Chemical 2 Distribution & Storage 3 BioMedical . Supply Brazed Aluminum Heat Exchangers (BAHX), . Offer a complete portfolio of cryogenic distribution and . Serve as end-to-end provider of respiratory therapy Air Cooled Heat Exchangers (ACHX)
Slide 76: Serving Growing Global End Markets – BioMedical
Serving Growing Global End Markets – BioMedical BioMedical FY 2016 Sales of $208M BioMedical FY 2017 Sales of $223M Environmental Environmental Europe Europe Life 9% ROW Life 10% ROW Sciences 34% Sciences 30% 8% 12% 34% 35% Industry Region Industry Region 17% 17% 55% 57% 41% 41% Asia United Asia Uni
Slide 77: BioMedical Technology Roadmap
BioMedical Technology Roadmap Exploration, Value Processing/ Re- Lifecycle Production & Treatment Transportation Storage Proposition/ Pipeline Liquefaction gasification Services Application On-site Generation Military LOX Storage Hospital O2 Generators Cryocooler Wastewater Treatment Aquaculture Ind
Slide 78: Diversified Customer Base
Diversified Customer Base Portable Oxygen Concentrators Military Oxygen Consistent core Concentrators Transportable Oxygen technologies across BioMedical Concentrators solutions Solutions deliver care and Stationary Oxygen support to patients, caregivers, Concentrators clinicians and researchers S
Slide 79: Life Sciences: CryoBio Storage Systems
Life Sciences: CryoBio Storage Systems © 2018 Chart Industries, Inc. Confidential and Proprietary 78
Slide 80: Attractive Life Science Market Fundamentals
Attractive Life Science Market Fundamentals Market size and growth Meaningful Annual Cold Strong Annual Global Storage Market Growth Market Growth . Systems provide clinics, biobanks, hospital, research facilities, and Channels even farmers the ability to store and transport materials at ultralow an
Slide 81: Leading Global Product Portfolio of Cryogenic Freezers and Shippers
Chart’s Leading Global Product Portfolio of Cryogenic Freezers and Shippers Stainless Steel Aluminum Cryobiological Storage Freezers Shippers and Transport Systems LN2 cryogenic storage solutions that offer the Liquid and vapor Dewars designed for secure Enhanced plumbing and vacuum-jacketed longest
Slide 82: Positioned to Capture More of the $1.1B Global Cold Storage Market
Positioned to Capture More of the $1.1B Global Cold Storage Market with New Products Highlights . Mechanical freezers are a significant component of cold storage products, representing ~90% of total sales 1 . Primarily used due to their low cost and ease of implementation . Typically not intended fo
Slide 83: The Future of Cold Storage − Chart MVE Fusion
The Future of Cold Storage − the New Chart MVE Fusion™ Chart MVE Fusion™ Self-sustaining cryostorage freezer . Innovative, energy efficient, ultra-low temperature . World’s first self-sustaining cryostorage freezer – No continuous cryogen needed! . Equipped with Qdrive Liquefaction Technology Winner
Slide 84: Health Care: Respiratory Oxygen Therapy
Health Care: Respiratory Oxygen Therapy © 2018 Chart Industries, Inc. Confidential and Proprietary 83
Slide 85: Operating in Growing Homecare Oxygen Therapy Market
Operating in Growing Homecare Oxygen Therapy Market . The home oxygen therapy market serves the needs of over 4 million Market size patients of whom ~70% are diagnosed with COPD and growth . The Home Care oxygen therapy equipment market is a $1.2B global market expected to grow to $2B over the next
Slide 86: Continuum of CAIRE
Continuum of CAIRE Patients seek diagnosis / treatment Patients are prescribed oxygen therapy © 2018 Chart Industries, Inc. Confidential and Proprietary 85
Slide 87: Strong Product Portfolio Aligned with Patient, Caregiver and Provider Needs
Strong Product Portfolio Aligned with Patient, Caregiver and Provider Needs Portable Oxygen Transportable Stationary Oxygen Liquid Oxygen Oxygen Concentrators (POC) Concentrators (TOC) Concentrators (SOC) Systems (LOX) 24/7 capabilities ─ offering At-home oxygen delivery Wearable, lightweight device
Slide 88: CAIRE's Track Record of Continuous Innovation
CAIRE’S Track Record of Continuous Innovation 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Launches AirSep AirSep AirSep CAIRE Portable FreeStyle Focus FreeStyle CAIRE FreeStyle FreeStyle Comfort Oxygen Series Concentrators Refresh 3 and 5 SeQual SeQual SeQual SeQual Se
Slide 89: Industry Trends Towards Telehealth
Industry Trends Towards Telehealth Medicare and Medicaid are shifting toward broader DME Clinician Patients reimbursement payments for e-visits and remote patient monitoring, and third party payors are expected to follow. Reduces number of Track patient Gives peace of mind visits utilization o
Slide 90: Developing and Launching Next-Gen Products
Developing and Launching Next-Gen Products . Innovative, ergonomic curve that skims the natural FreeStyle Comfort silhouette of the body making it more comfortable to wear Next-Gen POC . Attractive bundling option with SOC for DME partners . 20 to 30 percent unit cost improvement . Software enables
Slide 91: Growing Direct-to-Consumer (DTC) Channel
Growing Direct-to-Consumer (DTC) Channel . DTC is a combination of Factory Direct, channel partners and DMEs selling to patients for cash Medicare / Medicaid . U.S. reimbursement rate does not provide durable medical equipment dealers (DMEs) with an adequate incentive to readily provide POCs (e.g. p
Slide 92: Strong and Differentiated Positioning to Capture DTC Channel
Strong and Differentiated Positioning to Capture Growing Direct-to-Consumer (“DTC”) Channel in the U.S. Key Drivers Behind DTC Penetration Positioning . Next-gen POC Freestyle Comfort Strong Oxygen Concentrator offerings launching in Q1 2018 . Strong TOC and SOC offerings . Has been sold online thro
Slide 93: Financial Overview and Outlook
Financial Overview and Outlook Jillian Evanko, CFO © 2018 Chart Industries, Inc. Confidential and Proprietary 92
Slide 94: Full Year 2017 Financial Results
Full Year 2017 Financial Results $989 $0.89 $0.96 Sales & Revenue Earnings Per Share Adjusted 1 ($USD Million) Earnings per Share $989 $1.17 $$0.960.96 $0.91 $0.89 2 $859 $0.52 1, 3 $0.65 FY 2016 FY 2017 FY 2016 FY 2017 FY 2016 FY 2017 1. Adjusted earnings per share is a non-GAAP measure. 2017 exclu
Slide 95: Outlook | FY 2018 Guidance
Outlook | FY 2018 Guidance Capital Sales Adjusted EPS Expenditures $1.15B - $1.20B $1.75 - $2.00 $35M - $45M Flat to 2017 Inclusive of ~ $11M for 16% - 21% 82% - 108% finalization of La Crosse, WI capacity expansion Inclusive of ~ $0.15 of impact from U.S. tax reform 5% - 7% Assumes 27% - 29% full O
Slide 96: Chart Industries Financial Principles
Chart Industries Financial Principles 1. Maximize Top Line 3. Maintain Balance 5. Achieve Financial Growth & Operating Sheet Strength & Targets Income Flexibility 4. Deliver Disciplined 2. Expand Operating Capital Allocation Margin Strategy © 2018 Chart Industries, Inc. Confidential and Proprietary
Slide 97: Maximize Top Line Growth
1 Maximize Top Line Growth $1.7B Leading positions across the portfolio Aftermarket increase from 13% to 21% of sales by 2021 $1.15B 2018 Revenue Aftermarket, service & repair 2021 Revenue A Chart Industries Company Other acquisition + Strat eval + acquisitions Well balanced portfolio of long-cycl
Slide 98: Expand Operating Margin
2 Expand Operating Margin ~17% Operating Income ~9% Operating Income 2018 2021 Well balanced portfolio of long-cycle and short-cycle products © 2018 Chart Industries, Inc. Confidential and Proprietary 97
Slide 99: Maintain Balance Sheet Strength & Flexibility
3 Maintain Balance Sheet Strength & Flexibility Working Capital Leverage1 CapEx Priorities Strengthen leverage 2018 La Crosse Expansion through Synergies & Productivity & Growth $116M Maintenance Quality Consolidation and Cash Productivity & Safety $35M - $45M 2018 2021 $547M ----------- $30M - $35M
Slide 100: Deliver Disciplined Capital Allocation Strategy
4 Deliver Disciplined Capital Allocation Strategy Organic growth initiatives . Expect $250M FCF M&A over the next 3 years . Long-term leverage target of 2x – 3x Deleverage . Capital allocated to position the company Direct shareholder return for growth (when/if appropriate) Focused on long-term shar
Slide 101: Achieve 2021 Financial Targets
5 Achieve 2021 Financial Targets ~ 40+% 700bps 21% Revenue Growth to $1.7B Operating Margin Expansion to ~17% of Sales from Aftermarket from 13% . Leading Positions Across the Portfolio . Well-Balanced Portfolio of Long-Cycle and Short-Cycle Products . Consistent Growth in Operating Income, EPS and
Slide 102: Full Year 2017 – 2020 Outlook (Base Case)
Full Year 2017 – 2020 Outlook (Base Case) ($ in Billions) Sales Gross Margin 1.8 0.6 1.6 1.4 1.4 1.3 0.5 1.2 0.4 1.2 0.4 1.0 0.4 0.3 1.0 0.3 0.3 0.8 0.6 0.2 28% of 29% of 30% of 31% of 0.4 Sales Sales Sales Sales 0.1 0.2 0.0 0.0 FY 2017 FY 2018 FY 2019 FY 2020 FY 2017 FY 2018 FY 2019 FY 2020 Operati
Slide 103: Full Year 2017 – 2020 Outlook (w/ LNG Project)
Full Year 2017 – 2020 Outlook (w/ LNG Project) ($ in Billions) Sales Gross Margin 1.8 1.6 0.6 1.6 0.5 1.4 1.4 0.5 1.2 0.4 1.2 1.0 0.4 0.3 1.0 0.3 0.8 0.3 0.6 0.2 28% of 29% of 31% of 33% of 0.4 Sales Sales Sales Sales 0.1 0.2 0.0 0.0 FY 2017 FY 2018 FY 2019 FY 2020 FY 2017 FY 2018 FY 2019 FY 2020 Op
Slide 104: Chart Investment Highlights
Chart Investment Highlights Leading diversified industrial global manufacturer with diverse Operate in attractive, growing and broad product offering markets Innovative technical expertise Cross-operating segment scale and reputation and collaboration Longstanding relationships with industry leading
Slide 105: Q&A
Q&A © 2018 Chart Industries, Inc. Confidential and Proprietary 104