Mueller Water Products · NYSE:MWA
Mueller Water Products — Gabelli & Company 28th Annual Pump, Valve and Water Systems Symposium (February 2018)
26 slides from Mueller Water Products's conference presentation, Feb 21, 2018
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 Gabelli & Company 28th Annual Pump, Valve and Water Systems Symposium February 22, 2018
Slide 2: Non-GAAP Financial Measures and Forward-Looking Statements
2 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Non-GAAP Financial Measures. In an effort to provide investors with additional information regarding its results as determined under GAAP, the Company also provides non- GAAP information that management believes is useful to i
Slide 3: Mueller Water Products at a Glance
3 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Mueller Water Products at a Glance ≈60% Repair and replacement of municipal water systems ≈30% Residential construction ≈10% Natural gas utilities as of December 31, 2017 ($ in Millions) Net sales $ 837.1 Infrastructure $ 753.
Slide 4: Focused Strategy and Execution Driving Results
4 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Focused Strategy and Execution Driving Results We are a trusted partner for our customers with solutions and products that are recognized for their reliability, innovation and ability to deliver the lowest total cost of owners
Slide 5: Investment Highlights
5 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Investment Highlights Favorable market dynamics in municipal and residential end-markets Aging infrastructure with increasing public awareness driving need for investment requiring a $1.7 trillion investment, according to
Slide 6: Products and Markets
. Products and Markets
Slide 7: Our Leading Product Positions
7 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Our Leading Product Positions #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
Slide 8: Bringing Value to our Customers
8 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 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 d
Slide 9: Repair & Replacement Market
9 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 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’s Infrastructure (3) The EPA Clean Water and
Slide 10: Funding Water Infrastructure Repair
1 0 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 0 100 200 300 400 500 600 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 Fu
Slide 11: Focus on Manufacturing Excellence Driving Organic Growth
1 1 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Focus on Manufacturing Excellence Driving Organic Growth Infrastructure has strong adjusted EBITDA margins (27.5% in FY2017) providing a manufacturing base for future growth Enhanced operational initiatives driving ongoi
Slide 12: Strong Need for Intelligence in Water Infrastructure
1 2 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Strong Need for Intelligence in Water Infrastructure Water Conservation Customer Service Focus Awareness/education Ongoing monitoring Sustainability 40% of U.S. experiencing drought or abnormally dry conditions(1)
Slide 13: Technologies Bringing Intelligence to Water Infrastructure
1 3 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Intelligent Water TechnologyTM is Mueller’s full-line of innovative solutions, products and services that actively diagnose, monitor and control the delivery of safe, clean drinking water to consumers and businesses Technolo
Slide 14: Financial Performance
. Financial Performance
Slide 15: Focused Execution Driving Results
1 5 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Focused Execution Driving 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 Implemente
Slide 16: History of Strong Financial Performance
1 6 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 History of Strong Financial Performance (1) Adjusted EBITDA excludes other charges of $1.4 million in 2013, $3.1 million in 2014, $7.9 million in 2015, $7.2 million in 2016 and $21.2 million in 2017 $730 $783 $793 $801 $826
Slide 17: Q1 2018 Consolidated Financial Highlights
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 F E B R U A R Y 2 0 1 8 Grew consolidated net sales 6.6% led by a 9.4% increase in Infrastructure primarily driven by higher shipment volumes, the addition of Singer Valve and favorable pricing, partially offset by lower volume in Technologies' m
Slide 18: Strong Balance Sheet with Significant Flexibility
1 8 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 $1,549 $1,127 $1,101 $1,096 $740 $692 $678 $623 $601 $546 $489 $484 $480 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 Mar-06 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 $ in m ill io ns Strong Ba
Slide 19: Balanced and Disciplined Capital Allocation
1 9 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Balanced and Disciplined Capital Allocation Reduced debt by more than $1 billion since March 31, 2006 and $600 million since September 30, 2008 Net leverage position provides flexibility to support acquisitions and share
Slide 20: Investment Highlights
2 0 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Investment Highlights Favorable market dynamics in municipal and residential end-markets Aging infrastructure with increasing public awareness driving need for investment requiring a $1.7 trillion investment, according t
Slide 21: Supplemental Data
. Supplemental Data
Slide 22: Quarter ended December 31, 2017 Segment Results and Reconciliation
2 2 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Quarter ended December 31, 2017 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales $ 160.1 $ 18.2 $ — $ 178.3 Gross profit $ 52.5 $ 2.9 $ — $ 55.4 Selling, general an
Slide 23: Quarter ended December 31, 2017 Adjusted EBITDA Reconciliation
2 3 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Quarter ended December 31, 2017 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 55.1 Income tax benefit (1) (39.8 ) Interest expense, net (1) 5.2 Pension costs
Slide 24: Quarter ended December 31, 2016 Segment Results and Reconciliation
2 4 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Quarter ended December 31, 2016 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net sales $ 146.3 $ 20.9 $ — $ 167.2 Gross profit $ 47.6 $ 4.2 $ — $ 51.8 Selling, general an
Slide 25: Quarter ended December 31, 2016 Adjusted EBITDA Reconciliation
2 5 M U E L L E R W A T E R P R O D U C T S . C O M F E B R U A R Y 2 0 1 8 Quarter ended December 31, 2016 Infrastructure Technologies Corporate Consolidated (dollars in millions, except per share amounts) Net income $ 6.7 Income from discontinued operations (after tax) (1.3 ) Income tax expense (1
Slide 26: Questions
Questions