Slide 1: Bruker Corporation Q3 2017 Earnings Presentation
Bruker Corporation (NASDAQ: BRKR) Q3 2017 Earnings Presentation Frank Laukien, President & CEO Anthony Mattacchione, SVP & CFO November 2, 2017 Miroslava Minkova, Head of Investor Relations Innovation with Integrity
Slide 2: Safe Harbor & Reg. G Statement
BRUKER CORPORATION Safe Harbor & Reg. G Statement Any statements contained in this presentation that do not describe historical facts may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein
Slide 3: Business Update
Q3 2017 & YTD Q3-2017 Business Update 3
Slide 4: Q3-2017: Good revenue and operating profit growth, EPS declines on tax comparisons
Q3-2017: Good revenue and operating profit growth, EPS declines on tax comparisons Q3-2017 Performance Q3 Financials Revenues [$M] +10.6% Revenue increase of +$42M, or +10.6% y-o-y − Acquisitions add +4.8% y-o-y 436 − FX translation adds +2.4% y-o-y 394 − Organic revenue up +3.4% y-o-y, driven by
Slide 5: YTD Q3-2017: Improved organic revenue growth, further operating margin expansion
YTD Q3-2017: Improved organic revenue growth, further operating margin expansion, 2016 tax rate affects EPS comparisons YTD Q3-2017 Performance YTD Q3 Financials Revenues [$M] +8.3% Revenue increase of +$94M, or +8.3% y-o-y − Acquisitions add +5.3% y-o-y 1,235 − FX translation lowers revenue by -0
Slide 6: YTD Q3-2017 Operating Performance
GROUP OVERVIEW: YTD Q3-2017 Operating Performance Bruker BIOSPIN Group BIOSPIN low single digit constant currency revenue growth; operating margins lower, due primarily to less favorable mix NMR revenue slightly higher despite 1GHz system revenue in Q1-16 PCI grows with good Q2/Q3 execution an
Slide 7: YTD Q3-2017 Operating Performance
GROUP OVERVIEW: YTD Q3-2017 Operating Performance Bruker NANO Group NANO high single digit constant currency revenue growth, driven by academic and industrial market improvements and Hysitron acquisition; AXS revenue higher on industrial growth and European recovery Semicon metrology revenue h
Slide 8: Innovative products in proteomics and microbiology
INNOVATION AND PORTFOLIO TRANSFORMATION: Innovative products in proteomics and microbiology Fungiplex® Candida PCR Assay, timsTOFTM Pro for Proteomics MERLIN AST/ART products Unique dual-TIMS-QTOF mass spectrometer with Fungiplex Candida assay for rapid molecular trapped ion mobility separation
Slide 9: 2017 Key Priorities
2017 Key Priorities Accelerate Revenue Growth via a combination of organic growth and M&A contributions Sustain Margin Expansion as we continue our Operational & Commercial Excellence journey Continue to Strengthen Systems and insights by harmonizing processes, ERP and CRM platforms Invest in profit
Slide 10: Financial Update
Q3-2017 & YTD Q3-2017 Financial Update 10
Slide 11: Q3-2017 Overview
NON-GAAP FINANCIAL PERFORMANCE: Q3-2017 Overview [$ m, except EPS] Q3-2017 Q3-2016 Δ COMMENTS Reported revenue +10.6%, Revenues 435.6 393.9 +10.6% organic growth +3.4% Operating Profit 64.4 58.6 +10% Operating profit up +10% Margin (%) 14.8% 14.9% -10bps Operating margin -10 bps: volume and op
Slide 12: Q3-2017 Revenue Bridge
Q3-2017 Revenue Bridge Q3-2017 DRIVERS Q3-2017 Revenue Reported revenue +10.6% Organic Currency Portfolio Total Organic revenue up +3.4%, reflecting y-o-y +3.4% +2.4% +4.8% +10.6% increases at NANO and CALID Acquisitions add +4.8% to Q3-2017 Revenue Bridge [$M] revenue growth, primarily from B
Slide 13: Q3-2017 Non-GAAP Results
Q3-2017 Non-GAAP Results [$ m, except EPS] Q3-2017 Q3-2016 Δ COMMENTS Total Revenues 435.6 393.9 +10.6% Gross margin down -130 bps: – Dilution from OST acq. and FX Gross Profit 207.4 192.6 +8% – BioSpin product and geographic Margin (% of revenues) 47.6% 48.9% -130 bps mix SG&A -102.1 -96.1 +6%
Slide 14: YTD Q3-2017 Revenue Bridge
YTD Q3-2017 Revenue Bridge YTD Q3-2017 DRIVERS YTD Q3-2017 Revenue Reported revenue +8.3% Organic Currency Portfolio Total Organic revenue growth +3.4%, reflecting growth +3.4% -0.4% +5.3% +8.3% at all three Scientific Instruments Groups and the BEST segment YTD Q3-2017 Revenue Bridge [$M] Acq
Slide 15: YTD Q3-2017 Non-GAAP Results
YTD Q3-2017 Non-GAAP Results [$ m, except EPS] YTD Q3-17 YTD Q3-16 Δ COMMENTS Total Revenues 1,235.4 1,141.0 +8.3% Gross margin down -50 bps y-o-y. Operational improvements Gross Profit 584.1 544.9 +7% at CALID and NANO more than Margin (% of revenues) 47.3% 47.8% -50 bps offset by higher BEST rev
Slide 16: YTD Q3-2017 Cash Flow
YTD Q3-2017 Cash Flow [$ m] YTD Q3-17 YTD Q3-16 Δ COMMENTS Net Income 83.3 85.4 -2.1 Y-o-y free cash flow improvement driven by: Depreciation & amortization 48.2 40.4 +7.8 – Higher operating cash flow Changes in working capital* -44.4 -38.7 -5.7 – Partially offset by an Other -36.4 -47.1 +10.7 upt
Slide 17: FY 2017 Outlook
FY 2017 Outlook 17
Slide 18: FY 2017 Guidance: Raising Outlook for Operating Performance and Updates in FX
FY 2017 Guidance: Raising Outlook for Operating Performance and Updates in FX FY 2017 Guidance 2017 ASSUMPTIONS Organic revenue growth of Revenue Growth y-o-y +8% to +8.5% +2.5% to +3% Acquisition revenue growth: +4.5% Non-GAAP Operating +70 bps to +100 bps Margin Expansion y-o-y(1)(2) FX reve
Slide 19: Appendix
Appendix 19
Slide 20: Q3-2017 GAAP Results
Q3-2017 GAAP Results [$M, except EPS] Q3 2017 Q3 2016 Δ Total Revenues 435.6 393.9 +11% Gross Profit 198.0 185.2 +7% Margin (% of sales) 45.5% 47.0% SG&A -102.9 -96.8 +6% (% of revenues) 23.6% 24.6% R&D -40.9 -37.9 +8% (% of revenues) 9.4% 9.6% Operating Income 49.9 45.9 +9% (% of revenues) 11.5% 11
Slide 21: Q3-2017 Reconciliation of GAAP and Non-GAAP Results
Q3-2017 Reconciliation of GAAP and Non-GAAP Results [$M, except EPS] Q3 2017 Q3 2016 GAAP Operating Income 49.9 45.9 Restructuring Costs 4.6 5.3 Acquisition-Related Costs 0.7 0.4 Purchased Intangible Amortization 8.2 5.4 Other Costs 1.0 1.6 TOTAL 14.5 12.7 Non-GAAP Operating Income 64.4 58.6 Non-GAA
Slide 22: YTD Q3-2017 GAAP Results
YTD Q3-2017 GAAP Results [$M, except EPS] YTD Q3-2017 YTD Q3-2016 Δ Total Revenues 1,235.4 1,141.0 +8% Gross Profit 557.8 522.1 +7% Margin (% of sales) 45.2% 45.8% SG&A -303.8 -290.4 +5% (% of revenues) 24.6% 25.5% R&D -119.2 -110.8 +8% (% of revenues) 9.6% 9.7% Operating Income 121.0 100.3 +21% (%
Slide 23: YTD Q3-2017 Reconciliation of GAAP and Non-GAAP Results
YTD Q3-2017 Reconciliation of GAAP and Non-GAAP Results [$M, except EPS] YTD Q3-2017 YTD Q3-2016 GAAP Operating Income 121.0 100.3 Restructuring Costs 8.5 12.8 Acquisition-Related Costs 9.4 10.4 Purchased Intangible Amortization 22.6 16.2 Other Costs 3.8 6.2 TOTAL 44.3 45.6 Non-GAAP Operating Income
Slide 24: Q3-2017 Cash Flow
Q3-2017 Cash Flow [$ m] Q3 2017 Q3 2016 Δ COMMENTS Net Income 37.6 47.0 -9.4 Free cash modestly below Q3-16: Depreciation & amortization 17.1 13.7 +3.4 – Change in deferred income tax balances in Changes in working capital* -24.4 -23.7 -0.7 Q3-16 Other 5.0 -1.1 +6.1 – Increased use of cash for acc
Slide 25: Balance Sheet
Balance Sheet Sept 30, Dec 31, Sept 30, [$M] 2017 2016 2016 Total Assets 1,961.5 1,808.4 1,797.9 Working Capital* 690.3 598.2 613.4 Intangibles, Net & Other 364.3 293.4 291.8 Long-Term Assets Sept 30, Dec 31, Sept 30, [$M] 2017 2016 2016 Cash, Cash Equivalents & 429.2 500.3 441.5 Short-term Investme
Slide 26: BSI and BEST GAAP Performance
Q3-2017 GAAP SEGMENT RESULTS: BSI and BEST GAAP Performance [$ m] Q3-2017 Q3-2016 Δ REVENUE Scientific Instruments (BSI) 390.6 361.5 +8% Organic Revenue Growth (%) +4.2% -3.5% Energy & Supercon Technologies (BEST) 46.1 35.5 +30% Organic Revenue Growth (%) -9.7% +8.1% Corporate Eliminations -1.1 -3.1