Slide 1: Earnings Conference Call Q2 2022
7/28/2022 Earnings Conference Call Q2 2022 1
Slide 2: Forward-Looking Statements
7/28/2022 Brunswick Corporation - Earnings Release Forward-Looking Statements Certain statements in this presentation are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations, estimates, and projec
Slide 3: Use of Non-GAAP Financial Information and Constant Currency Reporting
7/28/2022 Brunswick Corporation – Earnings Release Use of Non-GAAP Financial Information and Constant Currency Reporting In this presentation, Brunswick uses certain non-GAAP financial measures, which are numerical measures of a registrant’s historical or future financial performance, financial posi
Slide 4: Business Overview
7/28/2022 BUSINESS OVERVIEW Dave Foulkes - CEO |4 ©2022 Brunswick Co. Confidential and all rights reserved. Thanks Neha, and good morning everyone. 4
Slide 5: Outstanding Performance Across the Company
7/28/2022 Brunswick Corporation – Earnings Release Outstanding Performance Across the Company Record Q2 results: Broad based top-line Field inventory remains Narrowed FY 2022 growth: low with elevated guidance: • Net sales of $1.84B (up • Record propulsion performance backlogs: • Net sales of $6.9B
Slide 6: We Continue to Successfully Navigate External Factors
7/28/2022 Brunswick Corporation – Earnings Release We Continue to Successfully Navigate External Factors ✓ Supply chain remains disruptive, although some moderation occurring ✓ Continued strong ECONOMIC CONCERNS CONSUMER BEHAVIOR consumer boating participation levels SUPPLY CHAIN DEALER SURVEYS Supp
Slide 7: Each Segment Contributed to Q2 2022 Outperformance
7/28/2022 Brunswick Corporation – Earnings Release Each Segment Contributed to Q2 2022 Outperformance PROPULSION PA R T S & B O AT S & B U S I N E S S ACCESSORIES A C C E L E R AT I O N • Share gains continue globally • Sales increases driven by Navico, • Double digit adjusted operating 1 through Q2
Slide 8: Mix By Region and Q2 Revenue Growth Rates
7/28/2022 Brunswick Corporation – Earnings Release Mix By Region1 and Q2 Revenue Growth Rates ✓ All regions experienced substantial sales Canada Europe growth, with the Growth +2% Growth +11% Mix: 7% Mix: 15% exception of Asia Pacific Asia- Pacific ✓ International sales up U.S. Growth -7% 7 percent
Slide 9: U.S. Main Powerboat Industry – Percentage Change in Retail Units
7/28/2022 Brunswick Corporation – Earnings Release U.S. Main Powerboat Industry – Percentage Change in Retail Units ✓ 1H 2022 main MAIN POWERBOAT OUTBOARD ENGINES (NMMA) 1H 2022 VS. powerboat industry SEGMENT 2022 VS. retail down 16% vs. 1H 2021, only slightly 10% below 1H 2019, with trends improvin
Slide 10: Financial Overview
7/28/2022 FINANCIAL OVERVIEW Ryan Gwillim – CFO | 10 ©2022 Brunswick Co. Confidential and all rights reserved. I will now turn the call over to Ryan for additional comments on our financial performance. 10
Slide 11: Overview of Second Quarter 2022 Adjusted Results
7/28/2022 Brunswick Corporation – Earnings Release Overview of Second Quarter 2022 Adjusted Results1 NET SALES ($m) OPERATING EARNINGS1 ($m) $1,836 $266 $300 ✓ Q2 2022 revenue, $1,555 +18% +13% operating earnings $1,164 $180 and EPS were highest in Company history ✓ Sales, earnings and 2019 2021 202
Slide 12: Overview of YTD 2022 Adjusted Results
7/28/2022 Brunswick Corporation – Earnings Release Overview of YTD 2022 Adjusted Results1 NET SALES ($m) OPERATING EARNINGS1 ($m) $3,531 $568 $509 $2,988 +18% +11% $2,214 $305 ✓ First Half 2022 performance higher than any previous full-year 2019 2021 2022 2019 2021 2022 except 2021 OPERATING MARGIN1
Slide 13: Propulsion Segment – Q2 '22 Performance
7/28/2022 Brunswick Corporation – Earnings Release Propulsion Segment – Q2 ’22 Performance % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Outboard Engines $566 14% 60% Sterndrive Engines $62 5% 24% Controls, Rigging and Propellers $106 11% 84% Total $734 13% 59% OPERATING MARGIN OPERATING EARNING
Slide 14: Parts & Accessories Segment – Q2 '22 Performance
7/28/2022 Brunswick Corporation – Earnings Release Parts & Accessories Segment – Q2 ’22 Performance1 % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Engine Parts and Accessories $147 (6)% 28% Distribution $232 (9)% 33% Advanced Systems Group $159 15% 32% Navico $114 N/A N/A Total $652 19% 59% OPER
Slide 15: Boat Segment – Q2 '22 Performance
7/28/2022 Brunswick Corporation – Earnings Release Boat Segment – Q2 ’22 Performance1 % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Aluminum Freshwater $237 25% 48% Recreational Fiberglass $187 22% 57% Saltwater Fishing $110 19% 34% Business Acceleration $36 134% N/A 2 Total $568 27% 55% OPERATI
Slide 16: Pipeline Metrics
7/28/2022 Brunswick Corporation – Earnings Release Pipeline Metrics UNITS IN PIPELINE – END OF Q2 2022 Global Pipelines U.S. Pipelines 23K -55% -63% 15K 10K 7K 5K 3K 2019 2021 2022 2019 2021 2022 WOH 35 9 16 WOH 32 6 12 1H 2022 pipeline levels 55% below 2019 levels; even lower inventory in U.S. | 16
Slide 17: Narrowing Full Year 2022 Guidance
7/28/2022 Brunswick Corporation – Earnings Release Narrowing Full Year 2022 Guidance1 Changes to FY 2022 EPS Assumptions: Changes to FY '22 EPS Guidance $10.40 ✓ 2H FX impact $10.30 $10.30 ✓ Share Repurchases $10.30 ✓ Q2 strong business $10.20 performance $10.10 Narrowed FY 2022 Guidance: $0.15 ✓ Re
Slide 18: Updated 2022 Full Year Assumptions
7/28/2022 Brunswick Corporation – Earnings Release Updated 2022 Full Year Assumptions 1 Share ~$400 MILLION Foreign Currency ~$35 – $40 MILLION Repurchases Prev: ~$300M Earnings Headwind Prev: ~$10 - $15M ~75.0 – 75.5 Average Diluted MILLION Tariff Earnings ~$50 MILLION Shares Outstanding Prev: ~76.
Slide 19: Wrap-Up
7/28/2022 WRAP-UP Dave Foulkes – CEO | 19 ©2022 Brunswick Co. Confidential and all rights reserved. I will now turn the call back to Dave for concluding remarks. 19
Slide 20: Brunswick in the News – Q2 2022
7/28/2022 Brunswick Corporation – Earnings Release Brunswick in the News – Q2 2022 Sea Ray 260 Women Portugal Photovoltaic Solar Mercury Launches New 25-30hp Refurbishment & Sales Center Design Team Project Outboards Opening Freedom Continues Rapid Growth • 360+ global locations • 50,000+ membership
Slide 21: Women Making Waves
7/28/2022 “Women making Waves”, which celebrates women making outstanding contributions to the recreational marine industry. 20
Slide 22: New Products and Technology
7/28/2022 Brunswick Corporation – Earnings Release New Products and Technology SLX 260 280 DAUNTLESS 25 & 30HP AVATOR POWER MANAGEMENT | 21 ©2022 Brunswick Co. Confidential and all rights reserved. I’m going to finish this morning discussing new products, which is always one of my favorite subjects.
Slide 23: Thank You + Q&As
7/28/2022 THANK YOU + Q&As | 22 ©2022 Brunswick Co. Confidential and all rights reserved. That’s the end of our prepared remarks. Remember to mark Wednesday, November 16 on your calendars, as we’ve invited the investment community to our test facility at Lake X, outside Orlando, Florida, for a day o
Slide 24: Appendix
7/28/2022 Appendix | 23 23
Slide 25: Updated Assumptions and Guidance for 2022
7/28/2022 Brunswick Corporation – Earnings Release Updated Assumptions and Guidance for 2022* 1 2 3 4 5 Revenue Operating Operating EPS FCF in between margin growth expenses as between EXCESS OF $6.9B - between 20 AND a % of sales $10.00 - $350 MILLION $7.1B 40 BPS to $10.30 INCREASE 20% 40 TO 60 23
Slide 26: 2022 Updated Outlook – Segment Guidance
7/28/2022 Brunswick Corporation – Earnings Release 2022 Updated Outlook – Segment Guidance Parts & Propulsion Accessories Boat N E T S AL E S UP MID-TO-HIGH TEENS UP LOW-TO-MID UP LOW-TWENTIES GROWTH PERCENT TWENTIES PERCENT PERCENT Prev: +Mid- Prev: +High- Prev: +Mid- Teens % Twenties % Teens % O P
Slide 27: 2022 Updated Outlook – P&L and Cash Flow Assumptions
7/28/2022 Brunswick Corporation – Earnings Release 2022 Updated Outlook – P&L and Cash Flow Assumptions Working ~$170 – $200 Effective Book APPROXIMATELY Capital Usage MILLION Tax Rate 22% No Change No Change Depreciation & ~$160 Effective Cash HIGH-TEENS Amortization1 MILLION Tax Rate PERCENT Prev:
Slide 28: 2022 Updated Outlook – Capital Strategy and Other Assumptions
7/28/2022 Brunswick Corporation – Earnings Release 2022 Updated Outlook – Capital Strategy and Other Assumptions Capital ~$375 – $425 MILLION Share ~$400 MILLION Expenditures No Change Repurchases Prev: ~$300M Debt $57 MILLION Quarterly $0.365 PER SHARE Retirement No Change Dividends No Change Net I
Slide 29: GAAP to Non-GAAP Reconciliations – Q2
7/28/2022 Brunswick Corporation – Earnings Release GAAP to Non-GAAP Reconciliations – Q2 Operating Earnings Diluted Earnings per Share (in millions, except per share data) Q2 2022 Q2 2021 Q2 2022 Q2 2021 GAAP $279.0 $250.2 $2.61 $2.29 Restructuring, exit and impairment charges — 0.2 — — Purchase acc
Slide 30: GAAP to Non-GAAP Reconciliations – YTD
7/28/2022 Brunswick Corporation – Earnings Release GAAP to Non-GAAP Reconciliations – YTD Operating Earnings Diluted Earnings per Share (in millions, except per share data) YTD 2022 YTD 2021 YTD 2022 YTD 2021 GAAP $518.5 $482.1 $4.86 $4.44 Restructuring, exit and impairment charges — 0.7 — — Purchas
Slide 31: Q2 Net Sales Increased by $280.8 Million
7/28/2022 Brunswick Corporation – Earnings Release Q2 Net Sales increased by $280.8 million, or 18 percent Segments Q2 2022 Q2 2021 % Change Propulsion $734.2 $649.5 13% Parts & Accessories 651.5 548.9 19% Boat 568.4 449.1 27% Segment Eliminations (118.5) (92.7) Total $1,835.6 $1,554.8 18% Q2 2022 C
Slide 32: YTD Net Sales Increased by $543.3 Million
7/28/2022 Brunswick Corporation – Earnings Release YTD Net Sales increased by $543.3 million, or 18 percent Segments YTD 2022 YTD 2021 % Change Propulsion $1,440.1 $1,307.3 10% Parts & Accessories 1,269.3 1,008.5 26% Boat 1,061.2 868.6 22% Segment Eliminations (239.3) (196.4) Total $3,531.3 $2,988.0
Slide 33: Q2 '22 Effective Tax Rate at ~22%
7/28/2022 Brunswick Corporation – Earnings Release Q2 ’22 Effective Tax Rate at ~22% Q2 2022 Q2 2021 Effective Tax Rate - GAAP 21.9% 23.5% 1 Effective Tax Rate - As Adjusted 22.2% 21.0% YTD 2022 YTD 2021 Effective Tax Rate - GAAP 21.5% 22.7% Effective Tax Rate - As Adjusted 1 21.7% 21.8% 1Tax provis
Slide 34: Free Cash Flow - YTD
7/28/2022 Brunswick Corporation – Earnings Release Free Cash Flow - YTD (in millions) YTD 2022 YTD 2021 Net cash provided by operating activities from $149.4 $350.5 continuing operations Net cash (used for) provided by: Capital expenditures (196.5) (110.3) Proceeds from sale of property, plant, equi