Ingersoll Rand Inc. · NYSE:IR
Ingersoll Rand — Q3 2020 Earnings Presentation
36 slides from Ingersoll Rand's earnings presentation, Nov 3, 2020
Slide 1: Ingersoll Rand Q3 2020 Earnings Presentation
Ingersoll Rand Q3 2020 Earnings Presentation November 3, 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains “forward-looking statements” as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995, including s
Slide 3: Today's Agenda
Today’s Agenda Integration Update Company Highlights Segment Highlights Key Takeaways Q&A Q& 3
Slide 4: Living Our Purpose and Values
Living Our Purpose and Values CREATING OUR UNIQUE CULTURE Purpose and Values Activation Employee Participation: 1,100 Q2 15,000 Q3 | survey rating – 4.5 out of 5.0 Owning Our Future Forum 2020 Live engagements reaching >7,000 employees to date Employee Engagement Survey 95% participation | 76 favora
Slide 5: Living Our Purpose and Values – $150M All-Employee Equity Grant
Living Our Purpose and Values – $150M All-Employee Equity Grant Poland LIVING OUR VALUES THINK AND ACT LIKE AN OWNER Equity Grant South Africa $150 Million awarded 16,000 owners | Equity 101 training ~75% Increase in value of 2017 Gardner Denver all-employee equity grant2 Employees helped grow the c
Slide 6: Strong and Consistent Execution to Deliver on Commitments
Strong and Consistent Execution to Deliver on Commitments PHASE 1 PHASE 2 PHASE 3 Strong Foundation Pivot to Growth Portfolio Optimization Nurturing single culture through Purpose & Values / Engagement / Diversity & Inclusion Added ‘domain expertise’ talent Executing on talent priorities Deploy Tale
Slide 7: Pivoting to Growth: Leveraging Differentiated Compression Technologies
Pivoting to Growth: Leveraging Differentiated Compression Technologies Penetrating High-Growth Hydrogen Market Growing Presence in Hydrogen Refueling & Dispensing Niche MARKET EXPECTATION • Haskel is a market leader with 70 years industry experience ~5,000 installed stations by 2027 = $2.5B market o
Slide 8: Pivoting to Growth: Leveraging Breadth of Portfolio in Targeted End Markets
Pivoting to Growth: Leveraging Breadth of Portfolio in Targeted End Markets Penetrating Water and Wastewater Market ~$5B Addressable Market1 Comprehensive Product Portfolio in Water and Wastewater • Current products playing in the market across two segments with multiple premium and market-leading b
Slide 9: IRX is One of Our Competitive Differentiators
IRX is One of Our Competitive Differentiators Q3 2020 Highlights • Synergy execution: executed $150M in annualized cost synergies1 • Continued sequential momentum on orders and revenue2 ̶ Orders: Down 8% YoY and down 2% ex-HPS; Up 13% from Q2’20 ̶ Revenue: Down 10% YoY and down 6% ex-HPS; Up 6% from
Slide 10: Q3 2020 Financial Performance vs. Q3 2019
Q3 2020 Financial Performance vs. Q3 2019 Supplemental Financial Information1 ($M, excl. EPS) Orders Revenue Adj. EBITDA & Margin2 Adj. Diluted EPS3 Adj. EBITDA Down 3%; Down 8% (As Reported and ex-FX) Down 10%; Down 11% ex-FX Up $0.01 Adj. EBITDA Margin Up 150 bps $35 0.00 90. 0% $294 $0.40 $284 80
Slide 11: Q3 2020 Financial Performance
Q3 2020 Financial Performance ($M, excl. Leverage) Free Cash Flow1,2 Leverage3 Liquidity Cash Flow from Operations less Capex (Net Debt / LTM Adjusted EBITDA) Total available liquidity of $2.3B including: $213 $205 4.2x RMT Transaction Completed ‒ Cash and Cash Equivalents: $1.3B $264 ($8) $264 ‒
Slide 12: Strong Execution on Synergy Delivery and Cost Control
Strong Execution on Synergy Delivery1 and Cost Control SYNERGY DELIVERY UPDATE MANAGING MARGINS Commentary Limited Q3'20 Decremental Margins4 to <10% for Total Company $350M+ Synergy Funnel and Improved Sequentially Cost synergy funnel remains in excess of $350M with continued room for growth ~$25
Slide 13: Industrial Technologies and Services Q3 2020 Highlights
Industrial Technologies and Services Q3 2020 Highlights Q3 2020 vs. Q3 20191 ($M) Q3 2020 vs. Q3 2019 Revenue/Orders Bridge1 Current Year Prior Year YoY ∆ Ex-FX YoY ∆ Organic FX M&A YoY ∆ Revenue $902.6 $984.0 (8.3)% (9.0)% Orders Growth (8.4)% 0.6% 0.4% (7.4)% Adj. EBITDA $216.8 $199.8 8.5% - Reven
Slide 14: Precision and Science Technologies Q3 2020 Highlights
Precision and Science Technologies Q3 2020 Highlights Q3 2020 vs. Q3 20191 ($M) Q3 2020 vs. Q3 2019 Revenue/Orders Bridge1 Current Year Prior Year YoY ∆ Ex-FX YoY ∆ Organic FX M&A YoY ∆ Revenue $209.9 $208.0 0.9% (0.9)% Orders Growth (9.3)% 1.6% 0.4% (7.3)% Adj. EBITDA $64.5 $56.6 14.0% - Revenue Gr
Slide 15: Specialty Vehicle Technologies Q3 2020 Highlights
Specialty Vehicle Technologies Q3 2020 Highlights Q3 2020 vs. Q3 20191 ($M) Q3 2020 vs. Q3 2019 Revenue/Orders Bridge1 Current Year Prior Year YoY ∆ Ex-FX YoY ∆ Organic FX M&A YoY ∆ Revenue $191.0 $189.0 1.1% 0.9% Orders Growth 29.4% 0.4% 0.0% 29.8% Adj. EBITDA $37.6 $27.6 36.2% - Revenue Growth 0.9
Slide 16: High Pressure Solutions Q3 2020 Highlights
High Pressure Solutions Q3 2020 Highlights Q3 2020 vs. Q3 20191 ($M) Q3 2020 vs. Q3 2019 Revenue/Orders Bridge1 Current Year Prior Year YoY ∆ Ex-FX YoY ∆ Organic FX M&A YoY ∆ Revenue $31.7 $100.0 (68.3)% (68.1)% Orders Growth (80.4)% (0.2)% 0.0% (80.6)% Adj. EBITDA $1.3 $26.9 (95.2)% - Revenue Growt
Slide 17: Current Business Trends and Q4 2020 Assumptions
Current Business Trends and Q4 2020 Assumptions Current Business Trends Q4 2020 Assumptions October Orders Performance (through first 3 weeks of month) • Expecting sequential revenue improvement given gradual market recovery and typical positive seasonality in IT&S and SVT Continued signs of stabili
Slide 18: Key Takeaways – Investing with Ingersoll Rand
Key Takeaways – Investing with Ingersoll Rand Creating a Premier Industrial Company with Iconic Brands and Market Leading Positions in 01 Early Stages of Transformation 02 Executing the Phases of our Multi-Year Transformation • Phase 1: Create Solid Foundation • Phase 2: Accelerate Growth • Phase 3:
Slide 19: Appendix
am) Ingersoll Rand Appendix
Slide 20: Q3 2020 Financial Performance – As Reported
Q3 2020 Financial Performance – As Reported ($M, excl. EPS) Orders Revenue Net Income1 EPS2 Up 133% Up 124% Down 29% Down $0.13 $41 $1,364 $1,335 $30 $0.20 $584 $597 Q3 2019 Q3 2020 $0.07 • Q3'20 includes $177 million of pre-tax amortization, restructuring and related business transformation costs,
Slide 21: Reconciliation of Net (Loss) Income and EPS to Adjusted Net Income and EPS
As Reported Financials: Reconciliation of Net (Loss) Income and (Loss) Earnings per Share to Adjusted Net Income and Adjusted Earnings per Share 21
Slide 22: Reconciliation of Net (Loss) Income to Adjusted EBITDA and CFOA to Free Cash Flow
As Reported Financials: Reconciliation of Net (Loss) Income to Adjusted EBITDA and Adjusted Net Income and CFOA to Free Cash Flow 22
Slide 23: Reconciliation of Segment Adjusted EBITDA to Income Before Income Taxes
As Reported Financials: Reconciliation of Segment Adjusted EBITDA to (Loss) Income Before Income Taxes 23
Slide 24: Unaudited Supplemental Adjusted Combined Financial Information
Unaudited Supplemental Adjusted Combined Financial Information 24
Slide 25: Table 1: Supplemental Adjusted Combined Financial Information by Segment
Table 1: Unaudited Supplemental Adjusted Combined Financial Information by Segment 25
Slide 26: Table 1A: Supplemental Adjusted Combined Financial Information by Segment
Table 1A: Unaudited Supplemental Adjusted Combined Financial Information by Segment 26
Slide 27: Table 1B: Supplemental Adjusted Combined Financial Information by Segment
Table 1B: Unaudited Supplemental Adjusted Combined Financial Information by Segment 27
Slide 28: Table 2: Supplemental Adjusted Combined Revenue and Order Growth by Segment
Table 2: Unaudited Supplemental Adjusted Combined Revenue and Order Growth / (Decline) by Segment1 28
Slide 29: Table 3: Reconciliation of Supplemental Adjusted Net Income and Diluted EPS
Table 3: Reconciliation of Unaudited Supplemental Adjusted Net Income and Supplemental Adjusted Diluted EPS to Supplemental Further Adjusted Net Income and Supplemental Further Adjusted Diluted EPS 29
Slide 30: Table 4: Reconciliation of Supplemental Adjusted Net Income to Adjusted EBITDA
Table 4: Reconciliation of Supplemental Adjusted Net Income to Supplemental Adjusted EBITDA and Supplemental Further Adjusted Net Income 30
Slide 31: Table 5: Supplemental Adjusted Revenue by Segment and EBITDA Reconciliation
Table 5: Supplemental Adjusted Revenue by Segment and a Reconciliation of Supplemental Segment Adjusted EBITDA to Supplemental Adjusted Income Before Income Taxes 31
Slide 32: Table 6: Reconciliation of GAAP Revenue to Supplemental Adjusted Revenue
Table 6: Reconciliation of GAAP Revenue to Supplemental Adjusted Revenue by Segment and for the Company and Segment Adjusted EBITDA to Supplemental Segment Adjusted EBITDA 32
Slide 33: Table 7: Reconciliation of GAAP Net (Loss) Income to Adjusted EBITDA
Table 7: Reconciliation of GAAP Net (Loss) Income to Adjusted EBITDA and Supplemental Adjusted EBITDA and Supplemental Further Adjusted Net Income 33
Slide 34: Table 8: Reconciliation of GAAP Diluted EPS to Further Adjusted Diluted EPS
Table 8: Reconciliation of GAAP Diluted EPS to Supplemental Further Adjusted Diluted EPS 34
Slide 35: Notes to Tables 3, 4 on Slides 29 – 31
Notes to Tables 3, 4, 5 of the Unaudited Supplemental Adjusted Combined Financial Information on Slides 29 – 31 35
Slide 36: Notes to Tables 3, 4 on Slides 29 – 31 (continued)
Notes to Tables 3, 4, 5 of the Unaudited Supplemental Adjusted Combined Financial Information on Slides 29 – 31 (continued) 36