Enovis Corporation · NYSE:ENOV
Enovis — Colfax — Investor Presentation (November 2009)
34 slides from Enovis's investor presentation, Nov 16, 2009
Slide 1: Investor Presentation November 16, 2009
Investor Presentation November 16, 2009
Slide 2: Forward-Looking Statements
The following information contains forward-looking statements, including forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements concerning Colfax's plans, objectives, expectati
Slide 3: Company Overview
2008 revenue of $605 million ~2,000 associates worldwide 15 principal production facilities in 7 countries Over 300 direct sales and marketing associates More than 450 authorized distributors in approximately 80 countries Headquartered in Richmond, VA Colfax is strategically focused on serving key i
Slide 4: Background
Founded in 1995 John Young, President & CEO, was an original founder Equity capital provided by Mitch and Steve Rales, founders of Danaher (NYSE: DHR) Targeted global industrial companies with strong brands 13 acquisitions, 5 divestitures Exclusively focused on fluid handling industry Proven, experi
Slide 5: Colfax Business System Drives Business Improvement
Derived from the proven Danaher Business System Utilize Voice of the Customer (“VOC”) to target breakthrough growth initiatives, new products and applications Conduct root-cause analysis, develop process improvements and implement sustainable systems Culture of continuous improvement Integrated in a
Slide 6: Investment Highlights
Global leader in specialty fluid handling products Proven application expertise in solving critical customer needs Serving growing global infrastructure driven end markets Leading brand names generating aftermarket sales and services Experienced management team in place to grow organically and throu
Slide 7: Broad Product Portfolio Focused on Customer Applications
2 and 3 Screw Pumps Well recognized brands across served markets Fluid Handling Systems Precision Gear Pumps Progressive Cavity Pumps Specialty Valves Centrifugal Pumps Broad Product Portfolio Focused on Customer Applications 6
Slide 8: Serving Critical Applications in Our Key End Markets
7 Commercial Marine Serving Critical Applications in Our Key End Markets General Industrial Power Generation Oil & Gas Global Navy Key Markets Applications Brands Commercial Marine Fuel oil transfer; oil transport; water and wastewater handling Allweiler, Houttuin , I mo AB Oil & Gas Crude oil gathe
Slide 9: Large and Diverse Customer Base and End Markets
Large and Diverse Customer Base and End Markets Blue Chip Customers (2) 2008 Revenues By End Markets 3% 4% 15% 5% 51% 22% (1) 6% 14% 14% 25% 41% ____________________ (1) Includes Distribution (11%), Chemical Processing (7%), Machinery Support (5%), Building Products (4%), Wastewater (2%), Heat Trans
Slide 10: Extensive Global Sales, Distribution and Manufacturing Footprint
EMEA = $338mm ____________________ (1) Sales figures reflect sales destination. (2) Closing in 2009. Americas = $174mm % of Revenue: 29% % of Revenue: 56% % of Revenue: 15% LSC Houston Warren Corporate HQ Richmond Imo Kentucky Imo Monroe (2) Houttuin Tushaco Vapi Tushaco Daman Colfax Wuxi Imo AB Sto
Slide 11: Application Case Studies
Situation Analysis A Canadian energy company moves heavy crude oil along pipelines from the oil fields in Northern Canada through extremely harsh environment to a central blending facility Colfax engineers and the customer's project engineer jointly developed the design, quality, and testing spec Wa
Slide 12: Expansion of Systems Business
Expansion of Systems Business Situation Analysis A major Japanese OEM turbine manufacturer wanted to reduce installation time required at power plant construction sites. Initial focus - integrate components associated with the fuel filter, pump and motor system. Colfax Solution Enhanced design, redu
Slide 13: Develop New Products, Applications and Technologies Driven by Voice of the Customer
Driven by VOC, examples of new products introduced in 2008 Develop New Products, Applications and Technologies Driven by Voice of the Customer Step 1 - VOC Step 1a – VOC Summary Step 2 – Prioritization Step 3 – Specification All-Heat SMART EMTEC SMART Benefits 1. Senses wear & alerts end-user 2. Eas
Slide 14: End Market Outlook
~$24.8bn ~$0.3bn ~$2.3bn ~$4.0bn ~$2.0bn Global infrastructure development will drive capital investment long term and will benefit local suppliers as well as international exporters of fluid handling equipment. Demand has softened in several portions of the general industrial market including chemi
Slide 15: Target Fast Growing Regions
Capitalize on growth opportunities by offering regionally developed products and solutions Standard packages of Imo and Allweiler products produced at our Greenfield, Wuxi China facility for Commercial Marine Continue to invest in sales and marketing capabilities to more effectively serve local Asia
Slide 16: Leading Brands Generating Aftermarket Sales and Services
Est. 1860 Acq. 1998 Est. 1897 Acq. 1997 Est. 1929 Acq. 1998 Est. 1931 Acq. 1997 Est. 1973 Acq. 2004 Est. 1920 Acq. 2004 Est. 1967 Acq. 2005 Est. 1968 Acq. 2007 Est. 1996 Acq. 2007 Product history dating back to 1860 provides large installed base High quality, reliable products used in critical appli
Slide 17: Continue to Pursue Strategic Acquisitions that Complement Our Platform
Continue to proactively engage with highly strategic targets Product, market and geographically focused searches Evaluate opportunistic bolt-on companies Pursue adjacent fluid handling acquisitions Effective selection and integration of 13 acquisitions since 1995 Acquisition Criteria Acquisition Ini
Slide 18: Asbestos Update
Claims arise from purchased components previously included in our products Significant solvent insurance coverage Bad faith lawsuit against insurance carriers increases costs in near term Estimated annual liability and related defense costs of $3 - $5 million before potential insurance asset or liab
Slide 19: Financial Overview
pifax Financial Overview Colfax Corporation 16
Slide 20: Financial Performance Overview – 2005-2008
Financial Performance Overview – 2005-2008 2008 2007 2006 2005 $400.0 $350.0 $300.0 $250.0 $200.0 $150.0 $100.0 $50.0 $0.0 $337.3 $292.8 $179.3 $118.3 $54.8 $64.1 $88.2 $105.6 $0.0 $20.0 $40.0 $60.0 $80.0 $100.0 $120.0 2005 2006 2007 2008 Backlog $345.5 $393.6 $506.3 $604.9 $0.0 $80.0 $160.0 $240.0
Slide 21: Financial Performance Overview – Current Quarter
Financial Performance Overview – Current Quarter 0.1% -- 0.2% -- Acquisitions (28.5)% (3.2)% (25.5)% (35.7)% -- -- Total Growth (Decline) (5.8)% -- -- FX Translation (29.9)% -- -- Existing Businesses 2009 YTD 2008 YTD - Q3 2009 Q3 2008 $600.0 $500.0 $400.0 $300.0 $200.0 $100.0 $0.0 $349.2 $542.9 $12
Slide 22: Income Statement Summary
Income Statement Summary Refer to Appendix for Non-GAAP reconciliation. __________________ Note: Dollars in millions. Long Term Goals: Annual sales of $1 billion, gross profit margin of 40% & EBITDA margin of 20% Delta October 2, 2009 September 26, 2008 $ % Orders $ 349.2 $ 542.9 $ (193.7) (35.7)% S
Slide 23: Statement of Cash Flows Summary
____________________ Note: Dollars in millions. Statement of Cash Flows Summary October 2, 2009 September 26, 2008 Net income (loss) 16.6 $ (11.0) $ Non-cash expenses 15.4 9.5 Change in working capital and accrued liabilities 6.8 (26.3) Other (4.8) (2.9) Total Operating Activities 34.0 $ (30.7) $ Ca
Slide 24: Profit Protection Plan Update
Continuing to rightsize to align capacity with demand Major actions since the beginning of the year: Reduced headcount by 330 employees or 15% Eliminated temporary, contract and full-time employees Implemented furlough programs in Germany Closed facility in Aberdeen, NC and closing Sanford, NC facil
Slide 25: Strong Financial Condition
Strong balance sheet Debt to adjusted EBITDA – approximately 1X Debt of $93 million, principal payments of $9 million in 2010, matures in 2013 Cash = $51 million $136 million available on revolver Strong cash flow Adjusted EBITDA (LTM) of $91 million Strong Financial Condition ____________________ N
Slide 26: Well Positioned for the Future
Well Positioned for the Future Leading Brand Names Generating Aftermarket Sales and Services Experienced Management Team in Place to Grow Organically and Through Strategic Acquisitions Global Leader in Specialty Fluid Handling Products Proven Application Expertise in Solving Critical Customer Needs
Slide 27: Appendix
Appendix 26
Slide 28: Non-GAAP definitions
Adjusted net income, adjusted net income per share, adjusted operating income and adjusted EBITDA exclude asbestos liability and defense costs (income) and asbestos coverage litigation expenses, certain legacy legal charges, restructuring and other related charges, certain due diligence costs, certa
Slide 29: Non-GAAP Reconciliation
Non-GAAP Reconciliation ____________________ Note: Dollars in thousands. 2008 2007 2006 2005 EBITDA Net (loss) income (571) $ 64,882 $ 94 $ 12,247 $ Interest expense 11,822 19,246 14,186 9,026 Provision for income taxes 5,438 39,147 3,866 6,907 Depreciation and amortization 14,788 15,239 11,481 11,4
Slide 30: Sales & Order Growth
Sales & Order Growth ____________________ Note: Dollars in millions. $ % $ % Year Ended December 31, 2005 345.5 $ 370.4 $ Components of Growth: Organic Growth from Existing Businesses 40.7 11.8% 65.6 17.7% Acquisitions 4.8 1.4% 4.4 1.2% Foreign Currency Translation 2.6 0.8% 1.9 0.5% Total Growth 48.
Slide 31: Non-GAAP Reconciliation
____________________ Note: Dollars in thousands. Non-GAAP Reconciliation October 2, 2009 September 26, 2008 October 2, 2009 September 26, 2008 EBITDA Net income (loss) 5,375 $ 13,651 $ 16,602 $ (10,950) $ Interest expense 1,834 1,951 5,466 9,684 Provision (benefit) for income taxes 2,188 5,329 7,433
Slide 32: Non-GAAP Reconciliation
____________________ Note: Dollars in thousands, except per share amounts. Non-GAAP Reconciliation October 2, 2009 September 26, 2008 October 2, 2009 September 26, 2008 Adjusted Net Income and Adjusted Earnings per Share Net income (loss) 5,375 $ 13,651 $ 16,602 $ (10,950) $ Restructuring and other
Slide 33: Non-GAAP Reconciliation
____________________ Note: Dollars in thousands. Non-GAAP Reconciliation October 2, 2009 September 26, 2008 October 2, 2009 September 26, 2008 Adjusted SG&A Expense Selling, general and administrative expenses 28,136 $ 33,233 $ 86,248 $ 97,516 $ Legacy legal adjustment - - - 4,131 Due diligence cost
Slide 34: Sales & Order Growth
____________________ Note: Dollars in millions. Sales & Order Growth $ % $ % Three Months Ended September 26, 2008 153.5 $ 173.8 $ Components of Change: Existing Businesses (18.4) (12.0)% (44.3) (25.5)% Acquisitions 0.5 0.3 % 0.4 0.2 % Foreign Currency Translation (7.1) (4.6)% (5.6) (3.2)% Total (25