Wesco International, Inc. · NYSE:WCC
Wesco International — FY2012 Earnings Presentation
23 slides from Wesco International's earnings presentation, Jan 31, 2013
Slide 1: Supplemental Financial Data: Fourth Quarter and Full Year 2012
Supplemental Financial Data =, an? WESCO Fourth Quarter and Full Year 2012 ps’ January 31, 2013
Slide 2: Safe Harbor Statement
Safe Harbor Statement Note: All statements made herein that are not historical facts should be considered as “forward- looking statements” within the meaning of the Private Securities Litigation Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may ca
Slide 3: 2012 Highlights
2012 Highlights Q4 Sales of $1.64 billion, up 3.5% YOY > 4.3 points acquisitions > 0.5 points favorable foreign exchange > (1.3) points organic EECOL and non-recurring charges relating to acquisition and high yield redemption ($0.11 EPS) Net income of $49 million, including EECOL and non-recurring c
Slide 4: Acquisitions Since 2010
Acquisitions Since 2010 Cumulative Acquired Sales at Closing (Millions) 4 599 400 325 2010 2011 2012 # 2 2 4 Estimated Estimated Annual 45 Year Acquisition Salesat Accretion Date Closing —_at Closing Potelcom 6/10 $25M TVC Communications 12/10 $300M $0.30 RECO 3/11 $25M Brews 10/11 $50M $0.04 RS Ele
Slide 5: WESCO and EECOL Combination
WESCO and EECOL Combination Full Year Proforma Geographies Products WESCO EECOL Canada Pax2 Combined us Data & Broadband Utility Construction’ Communications ‘Wire, Cable & Conduit
Slide 6: Industrial End Market
Industrial End Market Core Sales versus Prior Year D + Q42012 - Up 0.7% versus prior year ee 21S Pla - Up 0.7% sequential iy 16.7% soars PY + Twelfth consecutive quarter of year- | oe 48% on fis Ses over-year organic sales growth Wo YU = * Channel inventory levels appear to be in 51% balance with cu
Slide 7: Construction End Market
Construction End Market Core Sales versus Prior Years B. Construction + Q42012 - Down 4.8% versus prior year - Down 6.4% sequential pasa + Non-Residential " + Residential, + Backlog down approximately 3% versus — | 127% jygy, 123% BM year end 2011, and down approximately 4 WY 9 i 69% 0 Meu a am 5% s
Slide 8: Utility End Market
Utility End Market Core Sales versus Prior Year : uttity + Q42012 - Up 6.9% versus prior year - Down 1.0% sequential nm BH sires Otrnet + Seventh consecutive quarter of year-over- * Utity Contractors year organic sales growth — FI tom] [ee ie, + Hurricane Sandy sales impact of er ro H Es 1 approxima
Slide 9: CIG End Market
CIG End Market Core Sales versus Prior Year a + Q42012 - Down 3.3% versus prior year cs + commercial - 9 — cmmercal Down 2.4% sequential —J “covernment sean ~ ali 143% + Bidding activity remains active in the 75% 100% Bon ea commercial and institutional markets 34% |] | rf 1 | + Government bidding a
Slide 10: Q4 2012 Results
Q4 2012 Results 10 ($ millions, except EPS) Net sales Gross profit Selling, general and administrative expense Depreciation and amortization Income from operations Interest expense, net Loss on extinguishment of debt Income before income taxes EPS EECOL and WESCO (excluding | non-recurring Loss on E
Slide 11: Q4 2012 Results vs. Expectations
Q4 2012 Results Actual (excludes EECOL and non-recurring charges) Sales Growth Total sales growth of 2% to 4% 2% to 3% from acquisitions Total sales growth of 2% Acquisitions contributed 3% FX had a positive impact of 0.5% Gross Margin Gross margin at or above 20.2% Gross margin of 20.4% Operating M
Slide 12: Cash Generation
Cash Generation Il Free Cash Flow ($M) — Net Income ($M) 196 112 8 2010 2011 12 265 2012 Leverage (Total Par Debt to TTM EBITDA) 5 45 Reported 4.7X Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 a4 2010 2011 2012
Slide 13: 2013 EECOL EPS Accretion
2013 EECOL EPS Accretion Operations $1.66 - $1.76 Amortization ($0.33) - ($0.35) Interest ($0.65) - ($0.72) Synergies $0.29 - $0.33 Total ~$1.00 13
Slide 14: 2013 Expectations
2013 Expectations Sales Growth Total sales growth of 12% to 14%; (1%) to 1% excluding EECOL Total sales growth of 16% to 18%; second half expected to be stronger than first half Gross Margin Gross margin at or above 20.6% Gross margin at or above 20.7% Operating Margin Operating margin at or above 5
Slide 15: Appendix
15 Appendix
Slide 16: Sales Growth Components versus Prior Year
Sales Growth Components versus Prior Year 16 2010 2011 2012 Full Full Full Q3__Q4 Year Qi Q2_Q3_Q4 Year Qi_Q2_Q3_Q4 Year Organic Sales Growth (%) | (4.4) 67 133 158 78/165 127 113 132 134/98 82 14 (13) 44 Acquisitions (%) 00 00 07 11 04/70 74 69 62 68/26 22 40 43 33 FX (%) 18 19 09 07 13|14 10 14 00
Slide 17: Capital Structure
Capital Structure ($ Millions) AR Revolver Inventory Revolver Real Estate Mortgage 2017 Bonds 2019 2029 (No Put) NIA 2019 Term Loans “) 0 850 2029 Convertible Bonds () 345 345 Other 6 33, Total Par Debt 825 1,917 Cash and Cash Equivalents 64 86 86 Capital Expenditures 33 4 23 Free Cash Flow (1) 134
Slide 18: Recent Acquisitions
Recent Acquisitions Date Acquisition | Acquired Rationale Potelcom 6-2010 Expand presence in Alaska Add broadband communication products $300 NC 12-2010 and services (U.S, Canada, CALA) _ 10% ee Strengthen industrial automation and RECO SH || Gate ee $25 100% = s = Brews ‘Add utility and industrial
Slide 19: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures ($ Millions) Unaudited Full Year 2012 vs. 2011 Q4 2012 vs. Q4 2011 Q4 2012 vs. Q3 2012 a4 a4 a4 Q3 % % % 2012 2011 Growth 2012 2011 Growth 2012 2012 Growth Industrial Core $2,736 $2,604 51% $686 $681 0.7% $711 $707 0.7% Construction Core 2,088 2,071 0.9%
Slide 20: Convertible Debt and Non-Cash Interest
Convertible Debt and Non-Cash Interest as of December 31, 2012 Convertible Debentures Non-Cash Interest Expense (S Millions) (S Millions) Debt per Par Value Debt Balance Maturity of Debt Discount Sheet 2010 20112012 2029 344.9 (1737) 4712 Convertible Debt 43 25 23 Amortization of Deferred Financing
Slide 21: Convertible Debt and SARs/Options EPS Dilution
Convertible Debt and SARs/Options EPS Dilution Weighted Average Quarterly Share Count Stock Price 009 Convertible Debt | "SaRsOption Anards | Tal Dilted Share Count (in millions)? (in millions) (in millions) $40.00 3.33 0.53 avTT $50.00 5.05 O77 49.74 $60.00 6.20 091 51.03 24 2012 Average $62.70 6.4
Slide 22: Number of Work Days by Quarter
Number of Work Days by Quarter Qi Q2 Q3 @4 FY 2011 63 64 64 63 254 2012 64 64 63 63 254 2013 63 64 64 63 254 22
Slide 23: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation ($ Millions) Fo Full Year Full Year Full Year 2010 2011 2012 Cash flow provided by operations 1273 167.5 288.2 98.5 Less: Capital expenditures (15.1) (33.3) (23.1) (36) Free Cash Flow 1122 134.2 2651 049 Note: Free cash flow is provided by the Company as an additional l