Mueller Water Products · NYSE:MWA
Mueller Water Products — D.A. Davidson 11th Annual E & C Conference 2012
36 slides from Mueller Water Products's conference presentation, Sep 11, 2012
Slide 1: D.A. Davidson Annual E & C Conference
J 2 / S—/ Bate D.A. Davidson 11% Annual E & C Conference September 11, 2012
Slide 2: Non-GAAP Financial Measures
Non-GAAP Financial Measures The Company presents adjusted income (loss) from operations, adjusted operating margin, adjusted EBITDA, acted Enno margin, adjusted net income (loss), adjusted net income (loss) per share, free cash flow and net GAAP mi uted in ‘income loss) from operations represents in
Slide 3: Forward-Looking Information
Forward-Looking Information This presentation contains certain statements that may be deemed “ ” within the Private Securities Litigation Reform Act of 1995. All statements that aduress activities, events or developments that we intend, expect, plan, project, believe or anticipate will or may occur
Slide 4: Our Business
eller Water Products Our Business $1 billion LTM net sales (as of June 30, 2012)(") FY2011 Primary End Markets Net Sales $1B1 + Portfolio includes: Fire hydrants Valves Metering systems Piping component systems Leak detection Pipe condition assessment Residential Construction* x + Specified in 100 l
Slide 5: Investment Highlights
Investment Highlights ling North American provider of wate eee and flow control products ard services Increasing investment and improved operating efficiencies needed in water infrastructure industry Leading brands in water infrastructure and one of the largest installed bases of valves and hydrants
Slide 6: Business Performance: Long-Term Targets
jueller Water Products: Business Performance: Long-Term Targets Base business organic growth of 5% - 10%+ in normalized end market conditions Emerging technology businesses >20% Mueller Co. EBITDA margins of 20%+ in normalized end market conditions Anvil EBITDA margins in mid-teens in normalized end
Slide 7: Broad Product Portfolio
Broad Product Portfolio (S in mittions) Mu Co. = ANVIL Est. 1857 Est. 1999 (1850) $626 $373 hail $52 ™ lg ital $46 $14 soe aah Hydrants Iron Gate valves PRODUCT PORTFOLIO Metering Butterfly, Systems { Ball and \ Plug Valves Noe: tats re Ta ede i 30,2012 Uy seeping man cr Pipe Nipples Cast on Frings
Slide 8: Water Transmission Solutions
Mueller Water Products Water Transmission Solutions Mueller Water Products manufactures and markets products and services that are used in the transmission, distribution and measurement of safe, clean drinking water and in water treatment facilities. Inept ana papa (© MuclerCo, © Anilnteratinal
Slide 9: Products and competitors: hydrants, valves, brass
6 6 # FIRE BUTTERFLY & BRASS WATER HYDRANTS | GATE VALVES BALL VALVES PRODUCTS a gf a @ ACIPCO a a A.Y. McDonald vs DeZURIK a Ford Meter Box a McWane a gs n
Slide 10: Strategy and Objectives
jueller Water Products: Strategy and Objectives _¥g ucture markets worldwide. Maintain leadership positions with customers and end users products + : it service levels and services Continue to enhance operational & organizational excellence ‘Strengthened balance sheet + Consolidated plants + Impleme
Slide 11: Our End Markets
J e / S——/ Our End Markets
Slide 12: Historical Housing Starts
Historical Housing Starts YOY Change in Household Formation istoial Housing Starts (1959 - July 2012) (thounndsotnouol, Seon Anne fie New household aris 1 milli in 2011, just below the lon: 1.2 million, after falling to 400K in 2009-2010 Source: U.S. Census Bureau
Slide 13: Non-Residential Construction
Mueller Water Products Non-Residential Construction Non-Residential Construct AIA Billings Index ‘change vaue Pun? fron Reacts Bung Coniton Renae eee (Diffusion Index, nati i i 60 50 40 Jul-02 Jul-04 = Jul-06 = Jul-08 Jul-10 Jul-12 TEPEEEEREPLARERRRRERE AGE ‘Sowce Caneu Brau Zain &Asocts anaes Data
Slide 14: Anvil Highlights
Mueller Water Products Anvil Highlights | ; ~ | —_ on | ait
Slide 15: Anvil Key Products
Anvil Key Products Perce! cent Product Segment yet cate) Market jucts Key Competitor chanical: Gro Victaulic, Ward, Erico, iron/Steel Fittings, ‘Staple Wisconsin, Bonney Non-Residential Hangers, Pipe Nipples, Bull Forge, Westbrook Mechanical Industrial 75% Buildin Plugs & Fire Protection Constructio
Slide 16: Significant Market Opportunities
Significant Market Opportunities
Slide 17: The Market Opportunity Is Significant And Growing
jueller Water Products: The Market Opportunity Is Significant And Growing Future Drinking Wate! ‘SEIBELIP cTbg ECREAUTEN MN STESE Infrastructure Expenditure Needstt + Valves and hydrants typically replaced at same time as pipes Storage Treatment ASCE graded sunking water ae er infrastructure a D- So
Slide 18: Funding Water Infrastructure
eller Water Products Funding Water Infrastructure Stronger EPA regulations should lead to increased investment + At least 40 cities under consent decrees “The brilliant invisibility of our — Atlanta water system has become its most significant vulnerability. That invisibility makes it difficult for
Slide 19: Funding Water Infrastructure Repair
jueller Water Products: Funding Water Infrastructure Repair Operations si% oat Grants Other 7% OK Other Loans/Debe x 90% funded at local level(®) From 2008- 2010, average annual residential water rates increased about 13%(4) Bray for satis 8) Gachan water sn Orig ter nratncture 63% of American voter
Slide 20: Emerging Industry Trends
Emerging Industry Trends Aging Water Infrastructure How Mueller meets the need . A least 36 states Sproles water shorteees Leading brand in water + Broad 15% - 30% potat ilosttolleakst infrastructure Seer : x + One of the largest Products and services 1 45% pipe aging or elapsed by 20200) installed
Slide 21: Mueller Systems Highlights
Mueller Water Products Mueller Systems Highlights Focused on 2-Way AMI : Establishing backbone for real-time ‘information Greateirreducuand . walt mesh technology for an Intelligent Wer Technology backbone A 2 ll to mid-sized utilities Software Differentiation po: Leak detection, pipe condition asse
Slide 22: Opportunities: Smart Metering
eller Water Products Opportunities: Smart Metering OPPORTUNITY | SOLUTION IMERS. COMPETITORS Smart Meterin (Mueller systems) ‘ = ig Mueller systems) ‘American Water sensus + Advanced Meterin: + Two-way mesh Bentonville, AR bilieanicks a of network NEPTUNE ut $200 Charlotte County, FL puetusteariaces
Slide 23: Echologics Highlights
eller Water Products Echologics Highlights Acoustical Engineering Excellence Proprietary Technologies Vision of Solution Provider Leverage Brand and Sales Strength of Mueller Combination of people experienced in water industry and technology engineers Non-intrusive leak detection on all pipes, i i ;
Slide 24: Opportunities: Pipe Condition Assessment and Leak Detection
eller Water Products Opportunities: Pipe Condition Assessment and Leak Detection OPPORTUNITY SOLUTION END USER COMPETITORS Pipe Condition | Assessment and Leak echolo ICS Las Vegas, NV D i seca) New Orleans, LA * Constrained + Pioneered acoustic, . municipal budgets non-invasive leak Port Authority
Slide 25: Actions & Business Results
Actions & Business Results
Slide 26: Management Actions / Initiatives
jueller Water Products: Management Actions / Initiatives : Closed six plants since FY2006 a sted two non-core assets of Anvil in FY2010 Reduce costs and improve » Dhested Uy 5. Phae In Yaz operating leverage + Lowered lat : implemented ‘Lean si Sigma and other manufacturing improvements (continuous
Slide 27: History of Strong Financial Performance
Mueller Water Products History of Strong Financial Performance see appendices for GAAP reconciliation) @ (S in mitions) Mueller Co. NET SALES ADJUSTED EBITDA & ‘ADJ. EBITDA 3) Fz year ened eperber 3 eects oto: resvucurng charges i raion n 2" >) Erle tentry step ip conto 1 min insore
Slide 28: FY3Q Year-over-year Comparison
FY3Q Year-over-year Comparison $ in millions (except per share amounts) Third Quarter Fiscal 2012 2011 Net sales $275.9 $366.7 Adj. operating income $26.4 $15.6 Adj. operating margin 9.6% 4.3% Adj. net income per diluted share $0.05 $0.00 Adj. EBITDA S414 $35.9 15.0% 9.8% Adj. EBITDA margin FY2011 r
Slide 29: Debt Structure
eller Water Products Debt Structure Debt maturities with no significant required principal payments before 2015 No financial maintenance covenants with excess availability at the greater of $34 million or 12.5% of facility amount + $141.3 million of excess availability (as measured using June 30, 20
Slide 30: Why Invest in MWA?
Why Invest in MWA? Water industry has fundamentally strong long-term dyna + Driven for new and upgraded infrastructure + Limited number of suppliers to end markets Strong competitive position Leading brand position with large installed base Leading municipal specification positions : relationships +
Slide 31: Supplemental Data
Supplemental Data
Slide 32: Segment Results and Reconciliation of Non-GAAP to GAAP
Segment Results and Reconciliation of Non-GAAP to (5 inion, except pr share amounts)
Slide 33: Segment Results and Reconciliation of Non-GAAP to GAAP
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (S inmilions, except per share amounts) carats
Slide 34: Segment Results and Reconciliation of Non-GAAP to GAAP
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (5 inion, except pr share amounts)
Slide 35: Segment Results and Reconciliation of Non-GAAP to GAAP
Segment Results and Reconciliation of Non-GAAP to GAAP Performance Measures (5 inion, except pr share amounts)
Slide 36: Questions
Questions
Mueller Water Products — D.A. Davidson 11th Annual E & C Conference 2012 on 6ix