Slide 1: Regal Beloit Corporation Investor Relations Presentation
Regal Beloit Corporation Investor Relations Presentation NOVEMBER 2019 Louis Pinkham Chief Executive Officer Rob Rehard Vice President Chief Financial Officer Rob Cherry Vice President Investor Relations
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT The following is a cautionary statement made under the Private Securities Litigation Reform Act rates, recession, government policies, including policy changes affecting taxation, trade, tariffs, of 1995: With the exception of historical facts, the statements contained in this
Slide 3: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES We prepare financial statements in accordance with accounting principles generally accepted Corporation, adjusted income before taxes, adjusted provision for income taxes, adjusted in the United States (“GAAP”). We also periodically disclose certain financial measures in
Slide 4: Regal Overview
REGAL OVERVIEW Sales by Product Sales by Segment Other Power Founded in 1955 with Headquarters Couplings Climate Transmission Solutions in Beloit, Wisconsin Bearings 24% Solutions Small 28% Gearing Motors Generators 2018 Adjusted Sales of $3.4B 48% Large Motors Fans & Blowers Commercial & Industrial
Slide 5: Segment End Markets, Products & Brands
SEGMENT END MARKETS, PRODUCTS & BRANDS ©2019 Regal Beloit Corporation, Proprietary and Confidential 5
Slide 6: Financial Snapshot
FINANCIAL SNAPSHOT Adj. Net Sales* Adj. Operating Margin* (billions) 10.4% 11.0% $3.2 $3.4 $3.4 9.7% 2016 2017 2018 2016 2017 2018 Adj. Diluted EPS* Free Cash Flow* Yield $5.64 11.2% $4.87 9.9% $4.44 8.8% 2016 2017 2018 2016 2017 2018 * Non-GAAP Financial Measurement, See Appendix for Reconciliation
Slide 7: Consistently Generating Cash
CONSISTENTLY GENERATING CASH $500 175% $400 150% 125% $300 100% $200 75% 50% $100 25% $- 0% 2014 2015 2016 2017 2018 (millions) * Non-GAAP Financial Measurement, See Appendix for Reconciliation. Free Cash Flow % of Adj. Net Income 5-Year Average of 132% ©2019 Regal Beloit Corporation, Proprietary an
Slide 8: Returning Cash to Shareholders
RETURNING CASH TO SHAREHOLDERS Dividends Paid Per Share $1.08 $1.00 $0.94 $0.90 $0.84 $0.78 $0.74 $0.70 $0.64 $0.66 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Dividend Increase of 7% Announced April 29, 2019 ©2019 Regal Beloit Corporation, Proprietary and Confidential 8
Slide 9: Capital Allocation
CAPITAL ALLOCATION Invest in Growth Opportunities Return Cash to Shareholders Reduce Leverage Share Retire Existing Retain Excess Capital Expense Acquisitions Dividends Repurchases Debt Cash Balanced 2% - 3% Strengthen Maintaining ~20% Dividend Net Debt/EBITDA Ratio Targets of Sales the Core Financi
Slide 10: 2019 Sustainability Report
2019 SUSTAINABILITY REPORT • Published Inaugural Sustainability Report • Available at Regal’s Investors Website • Increasing the Impact of Our Handprint • Decreasing the Impact of Our Footprint We Believe Sustainability Delivers Long-Term Value for Shareholders ©2019 Regal Beloit Corporation, Propri
Slide 11: Thank You
Thank You Louis Pinkham Chief Executive Officer Rob Rehard Vice President Chief Financial Officer Rob Cherry Vice President Investor Relations
Slide 12: Appendix: Adjusted Diluted Earnings Per Share
APPENDIX ADJUSTED DILUTED EARNINGS PER SHARE Three Months Ended Six Months Ended Jun 29, Jun 30, Jun 29, Jun 30, 2019 2018 2019 2018 GAAP Diluted Earnings Per Share $ 1.55 $ 1.50 $ 3.54 $ 2.81 Restructuring and Related Costs 0.07 0.03 0.11 0.06 Purchase Accounting and Transaction Costs — 0.08 — 0.08
Slide 13: Appendix: 2018 First and Second Quarter Ongoing Business
APPENDIX The following tables outline the first and second quarter 2018 net sales and income from operations illustrating the impact of businesses divested and to be exited, which can be used to compare to Regal's 2019 guidance and actual performance. Commercial & Power Industrial Climate Transmissi
Slide 14: Appendix: 2018 Third and Fourth Quarter Ongoing Business
APPENDIX The following tables outline the third and fourth quarter 2018 net sales and income from operations illustrating the impact of businesses divested and to be exited, which can be used to compare to Regal's 2019 guidance and actual performance. Commercial & Power Industrial Climate Transmissi
Slide 15: Appendix: 2018 Full Year Ongoing Business
APPENDIX The following tables outline the full year 2018 net sales and income from operations, and the full year adjusted diluted earnings per share, illustrating the impact of businesses divested and to be exited, which can be used to compare to Regal's 2019 guidance and actual performance. Commerc
Slide 16: Appendix
APPENDIX ©2019 Regal Beloit Corporation, Proprietary and Confidential 16
Slide 17: Appendix
APPENDIX ©2019 Regal Beloit Corporation, Proprietary and Confidential 17
Slide 18: Fiscal Calendar Weeks
APPENDIX 1Q 2Q 3Q 4Q FY 2014 63 63 63 64 253 2015 64 63 64 59 250 2016 64 64 63 60 251 2017 64 63 63 60 250 2018 63 64 63 61 251 2019 63 63 63 61 250 Regal operates on a 52/53 week fiscal year ending on the Saturday closest to December 31 Fiscal Years 2015, 2016, 2017, 2018 and 2019 have 52 week