Timken Company (the) · NYSE:TKR
Timken Company (the) — Q3 2023 Earnings Presentation
36 slides from Timken Company (the)'s earnings presentation, Nov 1, 2023
Slide 1: 3Q 2023 Earnings Investor Presentation
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 3Q 2023 Earnings Investor Presentation November 1, 2023 The Timken Company
Slide 2: Agenda
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Agenda 2 Neil Frohnapple Introduction Director, Investor Relations Overview and Rich Kyle Business Update President
Slide 3: Forward-Looking Statements Safe Harbor and Non-GAAP Financial Information
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Forward-Looking Statements Safe Harbor and Non-GAAP Financial Information 3 Certain statements in this presentation
Slide 4: Overview and Business Update
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Overview and Business Update Rich Kyle President and Chief Executive Officer The Timken Company
Slide 5: 3Q 2023 Performance Highlights
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 3Q 2023 Performance Highlights 5 Sales of $1.14 billion in 3Q-23, up 0.6% from prior-year period ▪ Revenue down 6% o
Slide 6: Acquisition of Des-Case
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Acquisition of Des-Case 6 Expands Timken’s Industrial Motion product portfolio ▪ Manufacturer of specialty filtratio
Slide 7: Acquisition of Rosa Sistemi
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Acquisition of Rosa Sistemi 7 Scales Timken’s Linear Motion platform ▪ Manufacturer of roller guideways, linear bear
Slide 8: Announced Agreement to Acquire iMECH
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Announced Agreement to Acquire iMECH 8 Expands Timken’s Engineered Bearings product portfolio ▪ iMECH (Engineered So
Slide 9: Organic Growth Outlook – FY 2023 By Market/Sector
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Organic Growth Outlook – FY 2023 By Market/Sector 9 (Market/Sector Placement Reflects Mid-Point of Guidance) NEGATIV
Slide 10: 2023 Outlook
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 2023 Outlook 10 Prior Outlook Current Outlook (August 3, 2023) (November 1, 2023) Current Outlook: Full Year 2023 vs
Slide 11: Key Takeaways
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Key Takeaways 11 Looking back on 3Q-23 ▪ Strong execution and positive price/cost drove higher adjusted EBITDA margi
Slide 12: Consistent, Growing and Strong Performance
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Consistent, Growing and Strong Performance 12 Revenue ($B) Adj. EBITDA Margin Adj. EPS ~19.55% ~$4.7 19.2% ~$6.90 18
Slide 13: Financial Performance
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Financial Performance Phil Fracassa Executive Vice President and Chief Financial Officer The Timken Company
Slide 14: 3Q 2023 Financial Overview
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 3Q 2023 Financial Overview 14 Net Sales ($M) Adjusted EBITDA ($M) Earnings Per Share REPORTED (GAAP) ADJUSTED $1,136
Slide 15: 3Q 2023 Financial Highlights - Sales
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 3Q 2023 Financial Highlights - Sales 15 3Q-23 vs. 3Q-22 Sales by Geography – ORGANIC (Excludes Acquisitions (net) an
Slide 16: 3Q 2023 Financial Comparison – Adjusted EBITDA
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 3Q 2023 Financial Comparison – Adjusted EBITDA 16 $35 ($8) ($2) ($14) $216 $214 ($45) $9 $27 18.8% 18.9% 3Q-22 Volum
Slide 17: 3Q 2023 Financial Comparison – Net Income & Diluted EPS
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 3Q 2023 Financial Comparison – Net Income & Diluted EPS 17 3Q-22 3Q-23 $M EPS $M EPS Net Income / EPS $87.0 $1.18 $8
Slide 18: 3Q 2023 Segment Performance – Engineered Bearings
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 3Q 2023 Segment Performance 18 Engineered Bearings Sales of $776 million, down 0.5% from the same period Net Sales (
Slide 19: 3Q 2023 Segment Performance – Industrial Motion
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 3Q 2023 Segment Performance 19 Industrial Motion Sales of $367 million, up 2.9% from the same period last Net Sales
Slide 20: Cash Flow, Leverage & Capital Allocation
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Cash Flow, Leverage & Capital Allocation 20 Capital Structure ($M) ($M) 3Q-22 3Q-23 12/31/22 09/30/23 Net Cash from
Slide 21: Disciplined Capital Deployment Focused on Value Creation
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Disciplined Capital Deployment Focused on Value Creation 21 Approximately $900M of capital allocated thus far in 202
Slide 22: 2023 Outlook
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 2023 Outlook 22 Prior Outlook Current Outlook (August 3, 2023) (November 1, 2023) Current Outlook: Full Year 2023 vs
Slide 23: Long-Term Financial Goals
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Long-Term Financial Goals* 23 Strong Top-Line Growth Organic Growth CAGR: 4-5% ▪ Positive macros (incl. new markets)
Slide 24: Appendix: GAAP Reconciliations
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Appendix: GAAP Reconciliations The Timken Company
Slide 25: GAAP Reconciliation: Net Income & EPS
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason GAAP Reconciliation: Net Income & EPS 25 Reconciliations of Adjusted Net Income to GAAP Net Income and Adjusted Earn
Slide 26: GAAP Reconciliation: 2019-2022 Net Income & EPS
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason GAAP Reconciliation: 2019-2022 Net Income & EPS 26 Reconciliations of Adjusted Net Income to GAAP Net Income and Adj
Slide 27: GAAP Reconciliation: EBITDA and EBITDA, After Adjustments to GAAP Net Income
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason GAAP Reconciliation: EBITDA and EBITDA, After Adjustments to GAAP Net 27 Income Reconciliation of EBITDA to GAAP Net
Slide 28: GAAP Reconciliation: 2019-2022 EBITDA, and EBITDA, After Adjustments to Net Income
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason GAAP Reconciliation: 2019-2022 EBITDA, and EBITDA, After Adjustments 28 to Net Income Reconciliations of GAAP to Non
Slide 29: GAAP Reconciliation: Segment EBITDA & EBITDA Margin
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason GAAP Reconciliation: Segment EBITDA & EBITDA Margin 29 Reconciliation of segment EBITDA, after adjustments, to segme
Slide 30: GAAP Reconciliation: Net Debt & Free Cash Flow
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason GAAP Reconciliation: Net Debt & Free Cash Flow 30 Reconciliation of Total Debt to Net Debt, the Ratio of Net Debt to
Slide 31: GAAP Reconciliation: Consolidated EBITDA
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason GAAP Reconciliation: Consolidated EBITDA 31 Reconciliation of EBITDA and EBITDA, After Adjustments, to GAAP Net Inco
Slide 32: Supplemental Information: EBITDA Adjustments and Depreciation & Amortization by Segment
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Supplemental Information: EBITDA Adjustments and Depreciation & 32 Amortization by Segment (Unaudited) (Dollars in m
Slide 33: Supplemental Information: EBITDA Adjustments and Depreciation & Amortization by Segment
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason Supplemental Information: EBITDA Adjustments and Depreciation & 33 Amortization by Segment (Unaudited) (Dollars in m
Slide 34: GAAP Reconciliation: Adjusted EPS and Free Cash Flow Outlook
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason GAAP Reconciliation: Adjusted EPS and Free Cash Flow Outlook 34 Reconciliation of Adjusted Earnings per Share to GAA
Slide 35: GAAP Reconciliation: 2022 Consolidated Free Cash Flow
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 35 GAAP Reconciliation: 2022 Consolidated Free Cash Flow Reconciliation of Free Cash Flow to GAAP Net Cash Provided
Slide 36: GAAP Reconciliation: Net Sales to Organic Sales
These materials were presented on Nov. 1, 2023 and have not been confirmed or updated. The Company disclaims any obligation to do so based on subsequent events or for any other reason 36 GAAP Reconciliation: Net Sales to Organic Sales Reconciliation of Net Sales to Organic Sales (Unaudited) The foll