Rockwell Automation, Inc. · NYSE:ROK

Rockwell Automation — Q4 2021 Earnings Presentation

35 slides from Rockwell Automation's earnings presentation, Nov 2, 2021

  1. Slide 1: Fourth Quarter Fiscal Year 2021 Conference Call

    Fourth Quarter Fiscal Year 2021 Conference Call November 2, 2021 PUBLIC 1

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement THIS PRESENTATION INCLUDES GUIDANCE AND OTHER STATEMENTS RELATED TO THE EXPECTED FUTURE RESULTS OF THE COMPANY AND ARE THEREFORE FORWARD-LOOKING STATEMENTS. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE PROJECTIONS DUE TO A WIDE RANGE OF RISKS AND UNCERTAINTIES, MANY OF WHICH

  3. Slide 3: Q4 FY21 Results Highlights

    Q4 FY21 Results Highlights ▪ Record orders of over $2.2B, up over 40% YOY – Strong double-digit growth across all segments ▪ Reported sales up 15% YOY, with additional sales shifting into fiscal 2022 due to supply chain headwinds ▪ Organic sales up 13% YOY – Information Solutions & Connected Service

  4. Slide 4: Q4 FY21 Organic Industry Segment Performance

    Q4 FY21 Organic Industry Segment Performance % of Q4 FY21 Q4 FY21 Sales vs. Q4 FY20 Q4 FY21 vs. Q4 FY20 Discrete  Semiconductor up ~20%  Automotive up ~15% ~ 25% Up ~15%  e-Commerce up ~30% Hybrid  Food & Beverage up ~15% ~ 45% Up ~10%  Life Sciences up ~15%  Tire up ~35% Process  O&G up ~ 20

  5. Slide 5: Q4 and Full Year FY21 Organic Sales Growth

    Q4 and Full Year FY21 Organic Sales Growth North America EMEA Q4: +15.7% Q4: +7.3% FY: +8.0% FY: +2.8% Q4 Highlights * • North America growth led by Asia Pacific Food & Beverage, Oil & Gas and Life Sciences Q4: +11.8% FY: +10.3% • EMEA strength driven by Food & Beverage, Tire and Metals • Asia Pacif

  6. Slide 6: Full Year FY21 Highlights

    Full Year FY21 Highlights ▪ Record orders of $8.2B, up 26% YOY ▪ Reported sales up 10.5% YOY; acquisitions contributed 1.5 pts ▪ Organic sales up 6.7% YOY ▪ IS/CS over $500M of revenue; organic IS/CS growth up double digits ▪ ARR over 8% of total revenue; organic ARR growth up 18% ▪ Adjusted EPS of

  7. Slide 7: Full Year FY22 Outlook Highlights

    Full Year FY22 Outlook Highlights ▪ Total sales growth of 17.5% YOY at the guidance midpoint ▪ Organic sales growth of 15.5% YOY at the guidance midpoint ▪ Expecting flat sequential sales in first quarter with sequential increases thereafter ▪ Acquisitions expected to contribute ~2 pts of growth ▪ I

  8. Slide 8: FY22 Organic Industry Segment Outlook

    FY22 Organic Industry Segment Outlook % of FY22 FY21 Sales vs. FY21 Assumptions at Guidance Midpoint Discrete  Automotive up mid teens ~ 25% Up ~15%  Semiconductor up mid teens  e-Commerce up ~20% Hybrid  Food & Beverage up mid teens ~ 40% Up ~15%  Life Sciences up mid teens  Tire up ~20% Proc

  9. Slide 9: Q4 FY21 Key Financial Information

    Q4 FY21 Key Financial Information ($ in millions, except per share amounts) Q4 2021 Q4 2020 YOY B/(W) Organic Growth +12.6 % Inorganic Growth +1.0 % SALES $1,808 $1,570 Currency Translation +1.5 % Reported Growth +15.1 % SEGMENT OPERATING MARGIN 17.9% 20.2% (230) bps CORPORATE AND OTHER $33 $22 $(11

  10. Slide 10: Q4 FY21 Segment Results

    Q4 FY21 Segment Results SALES SEGMENT OPERATING SEGMENT ($ in millions; YOY growth %) MARGIN HIGHLIGHTS Organic +15.2 % Intelligent ▪ Higher segment margin YOY mainly due to higher sales Devices Inorganic —% 19.4% $857M Currency +1.5 % +100 bps YOY ▪ Orders grew ~40% YOY Reported +16.7 % Organic +13

  11. Slide 11: Q4 FY20 to Q4 FY21 Adjusted EPS Walk

    Q4 FY20 to Q4 FY21 Adjusted EPS Walk PUBLIC| Copyright ©2021 Rockwell Automation, Inc. | 11

  12. Slide 12: Q4 FY21 Guidance Midpoint to Q4 FY21 Adjusted EPS Walk

    Q4 FY21 Guidance Midpoint to Q4 FY21 Adjusted EPS Walk PUBLIC| Copyright ©2021 Rockwell Automation, Inc. | 12

  13. Slide 13: Quarterly Product Order Trends: Q1 FY19 – Q4 FY21

    Quarterly Product Order Trends: Q1 FY19 – Q4 FY21 Global Daily Average Product Orders Impact of large product orders booked in the quarter Note: product orders represent ~2/3 of total business and includes both software and hardware products PUBLIC| Copyright ©2021 Rockwell Automation, Inc. | 13

  14. Slide 14: Full Year FY21 Key Financial Information

    Full Year FY21 Key Financial Information (in millions, except per share amounts) 2021 2020 YOY B/(W) Organic Growth +6.7 % Inorganic Growth +1.5 % SALES $6,997 $6,330 Currency Translation +2.3 % Reported Growth +10.5 % SEGMENT OPERATING MARGIN 19.9% 19.9% 0 bps CORPORATE AND OTHER $121 $99 $(22) ADJ

  15. Slide 15: Fiscal 2022 Guidance

    Fiscal 2022 Guidance Full Year Outlook Sales Midpoint ~ $8.2B Organic Growth Range 14% - 17% Inorganic Growth ~ 2% Currency Translation ~ 0% Segment Operating Margin ~ 21.5% Adjusted Effective Tax Rate ~ 17% Adjusted EPS $10.50 - $11.10 Free Cash Flow as a % of Adjusted Income ~ 90% Note: As of Nove

  16. Slide 16: FY21 Actuals to FY22 Guidance Adjusted EPS Walk

    FY21 Actuals to FY22 Guidance Adjusted EPS Walk PUBLIC| Copyright ©2021 Rockwell Automation, Inc. | 16

  17. Slide 17: Capital Deployment Framework

    Capital Deployment Framework ORGANIC INVESTMENTS Operating Cash Flow Capital Expenditures ~2 to 2.25% of Sales Free Cash Flow ~100% of Adjusted Income INORGANIC INVESTMENTS Acquisitions Target > 1 pt of growth per year FCF yield > (WACC + risk premium) by years 3-5 EXCESS CASH RETURNED TO SHAREOWNER

  18. Slide 18: Save the Date: Investor Day Nov 10, 2021

    SAVE THE DATE • INVESTOR DAY NOV 10, 2021 HOUSTON, TEXAS PUBLIC| Copyright ©2021 Rockwell Automation, Inc. |

  19. Slide 19: Appendix

    Appendix Supplemental Financial Information and Reconcilations to Non-GAAP Measures 19

  20. Slide 20: Operating Segments Composition

    Operating Segments Composition Former A&S business Former CP&S business Intelligent Devices Software & Control Lifecycle Services ▪ Drives ▪ Control software & hardware ▪ Consulting ▪ Motion ▪ Visualization software & hardware ▪ Professional services  Solutions ▪ Safety ▪ Digital twin & simulation

  21. Slide 21: FY21 Organic Industry Segment Performance

    FY21 Organic Industry Segment Performance % of FY21 FY21 Sales vs. FY20 FY21 vs FY20 Discrete  Automotive up ~10% ~ 25% Up ~15%  Semiconductor up high teens  e-Commerce up ~50% Hybrid  Food & Beverage up ~15% ~ 40% Up ~10%  Life Sciences up ~20%  Tire up ~20%  Oil & Gas down mid teens Process

  22. Slide 22: FY20 to FY21 Adjusted EPS Walk

    FY20 to FY21 Adjusted EPS Walk PUBLIC| Copyright ©2021 Rockwell Automation, Inc. | 22

  23. Slide 23: FY21 Impact of Plex

    FY21 Impact of Plex One-Time Deferred Transaction Revenue Interest Total Operations Adjustment & Integration Expenses Expense Reported Sales1 ~$15M ~$(3)M ~$10M Segment operating earnings1 ~$5M2 ~$(3)M ~$(1)M ~$1M Corporate and other ~$(15)M ~$(15)M Interest Expense – net ~$(5)M ~$(5)M Adjusted EPS3

  24. Slide 24: FY22 Guidance - Impact of Plex

    FY22 Guidance - Impact of Plex Deferred One-Time & Revenue Interest Total Operations Adjustment Integration Reported Expenses Expense Sales1 ~$185M ~$(15-35)M ~$160M Segment operating earnings1 ~$55M2 ~$(15-35)M ~$(10)M ~$20M Corporate and other Interest Expense – net ~$(25)M ~$(25)M Adjusted EPS3 ~

  25. Slide 25: Industry Segmentation

    Industry Segmentation % of FY21 Sales Discrete Hybrid Process ~10% Automotive ~20% Food & Beverage ~10% Oil & Gas ~5% Semiconductor ~5% Life Sciences ~5% Mining ~5% Warehousing & E-commerce ~5% Household & Personal Care ~5% Metals ~5% General Industries ~5% Tire ~5% Chemicals • Printing & Publishing

  26. Slide 26: Q4 FY21 Results: Summary

    Q4 FY21 Results: Summary (in millions, except per share amounts) Q4 2021 Q4 2020 Total Sales $ 1,807.8 $ 1,570.0 Total Segment Operating Earnings $ 323.2 $ 317.9 Purchase Accounting Depreciation and Amortization (17.4) (11.3) General Corporate - Net (33.0) (22.0) Non-operating pension and postretire

  27. Slide 27: Free Cash Flow

    Free Cash Flow (in millions) Q4 2021 FY 2021 Net Income $ 75 $ 1,344 Depreciation/Amortization 54 190 Retirement Benefits Expense 37 155 Receivables/Inventory/Payables (73) (156) Compensation and Benefits 33 175 Pension Contributions (9) (36) Income Taxes (118) (127) Change in fair value of investme

  28. Slide 28: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Organic Sales (in millions, except percentages) Three Months Ended September 30, 2021 2020 Reported Sales Currency Organic Effect of Growth Acquisition Growth Growth Effect of Changes in Organic (Decline) Growth (Decline) (Decline) Sales(a) Acquisitions(e) Currenc

  29. Slide 29: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Organic Sales (in millions, except percentages) Three Months Ended September 30, 2021 2020 Sales Currency Organic Effect of Growth Acquisition Growth Growth Effect of Changes in Organic (Decline) Growth (Decline) (Decline) Sales(a) Acquisitions(e) Currency(d) Sale

  30. Slide 30: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Segment Operating Margin (in millions, except percentages) Three Months Ended Twelve Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Sales Intelligent Devices (a) $ 857.1 $ 734.5 $ 3,311.9 $ 2,956.0 Software & Control (b) 4

  31. Slide 31: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Adjusted Income, Adjusted EPS, and Adjusted Effective Tax Rate (in millions, except per share amounts) Three Months Ended Twelve Months Ended September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020 Net Income attributable to Rockwell Automation

  32. Slide 32: Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Return On Invested Capital ($ in millions) Twelve Months Ended September 30, 2021 2020 (a) Return Net income $ 1,344.3 $ 1,023.2 Interest expense 94.6 103.5 Income tax provision 181.9 112.9 Purchase accounting depreciation and amortization 55.1 41.4 Return 1,675.9

  33. Slide 33: Fiscal 2022 Guidance Reconciliation to Non-GAAP Measures

    Reconciliation to Non-GAAP Measures Fiscal 2022 Guidance (in billions, per share amounts) Organic Sales Fiscal 2022 Guidance Organic sales growth 14% - 17% Inorganic sales growth ~ 2% Foreign currency impact ~ 0% Reported sales growth 16% - 19% Segment Operating Margin Total sales (a) $ ~ 8.2 Total

  34. Slide 34: Performance Metric Definition

    Performance Metric Definition Organic ARR Growth Annual recurring revenue (ARR) is a key metric that enables measurement of progress in growing our recurring revenue business. It represents the annual contract value of all active recurring revenue contracts at any point in time. Recurring revenue is

  35. Slide 35: Thank you

    Thank you www.rockwellautomation.com 35

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