Dover Corporation · NYSE:DOV
Dover — Investor Day (June 2010)
66 slides from Dover's investor day presentation, Jun 16, 2010
Slide 1: Investor Road Trip Cincinnati, Ohio June 16-17, 2010
Investor Road Trip Cincinnati, Ohio June 16 - 17, 2010
Slide 2: Forward Looking Statements
Forward Looking Statements We want to remind everyone that our comments may contain forward-looking statements that are inherently subject to uncertainties. We caution everyone to be guided in their analysis of Dover Corporation by referring to our Form 10-K for a list of factors that could cause ou
Slide 3: Market Update
Market Update Q2 business levels as anticipated Q2 book-to-bill (thru May): 1.08 Supply chain: Shortages in electronic components & PCBs Minor disruptions elsewhere Weak EUR impact (inc. correlated currencies): FY Revenue impact could be $70M - $90M FY Earnings impact could be $0.03 - $0.05 Global s
Slide 4: Market Update: Acquisition pipeline
Market Update Acquisition pipeline Pipeline is getting stronger Could see more meaningful acquisitions in 2nd half Gulf oil spill will not have a measurable impact on results Little content in offshore applications 4 Genesis shears assisting in Gulf
Slide 5: Market Update: Segment end-markets
Market Update Industrial Products End-markets continue to be slowest to recover; Material Handling showing modest improvement as expected Engineered Systems Product ID remains solid and refrigeration equipment markets remain seasonally strong Fluid Management Business remains healthy driven by marke
Slide 6: Positioning for Growth: Areas of Focus
Positioning for Growth Areas of Focus to Create Shareholder Value 6 More Disciplined Capital Allocation Capturing Benefits of Common Ownership
Slide 7: Positioning for Growth: Organic growth
Positioning for Growth Organic growth: Geographic expansion New product development Market share gain 7
Slide 8: Healthy Portfolio Positioned for Growth
Leading market positions, strong industrial brands Value-added in engineering, design and marketing Intense customer intimacy Application-specific innovation, creating value for customers Sustainable growth, exposure to tailwinds and growth drivers Longer product life cycles with evolutionary techno
Slide 9: Significant Exposure to Favorable Global Macro Growth Trends
Increased living standards Infrastructure build-out Manufacturing/LCC capabilities International/ BRIC growth Global energy demand Increased demand, depleting resources Renewable energy technologies Emerging market growth Sustainability Energy efficiency Environmentally friendly products Recycling C
Slide 10: ESG - Product Innovation
ESG - Product Innovation Alternative "green" (solar) energy source Saves haul costs, truck emissions by compacting trash + call for pick-ups only when full New "Green" Compactor Product Emissions Reducing Solar Waste Compactor New solar & electric hybrid powered self contained solutions Pick-up when
Slide 11: TWG - Geographic Expansion
TWG - Geographic Expansion ZOOMLION China Crane Monitoring US Technology Driving Opportunity in China First platform for TWG safety controls in China ZOOMLION recognized our leading technology Benefits Develops relationship with major china based crane manufacturers Potential opportunity to sell sup
Slide 12: Hill PHOENIX - Business Development
Hill PHOENIX - Business Development Target announces a huge refrigeration remodel program HP (through Tyler acquisition) meets with Target to explore how we can assist December 2009 Target signs agreement with HP to manage over 80 large remodels March 2010 The 1st round of HP remodeled stores open A
Slide 13: SWEP - Business Development
SWEP - Business Development Increase brazed heat exchanger market share Best-in-class and proactive global quality Vigorous global customer support Manufacturing on three continents Leverage technical expertise Relentless cost improvements Build on Strengths Business Drivers: Global warming / climat
Slide 14: SWEP - Global customers with localized needs
SWEP - Business Development Global customers with localized needs Next Generation energy & environmental trends & rules Tap water heating Emerging Trends Our Response Locations (pre 2009) Pune, India; Kuala Lumpur; Sydney China - Guangzhou, Shanghai, Beijing, Chengdu & Suzhou Sales offices added in
Slide 15: US Synthetic - Technology Adoption
US Synthetic - Market Share Gain Technology Adoption PDC bits displace traditional rolling cone bits: Diamond cutting structure replaces steel and tungsten carbide. Improved durability and better bit stability. Large gains in shale plays and horizontal drilling, both of which are growing. PDC Adopti
Slide 16: US Synthetic - Share Gain
US Synthetic - Market Share Gain Share Gain PDC Share Current estimated share Share 18 months ago In drilling, the best performance wins. We re-win our business every day. Recent share gains are a result of a faster innovation cycle and improved product performance. Share gained not only against our
Slide 17: Knowles - Technology & Capacity Expansion
Knowles - Technology & Capacity Expansion Relentless focus on improving core technology Shrink product footprint Improve quality Provide unparalleled service Keep up with growing demand Continue to grow capacity Constant focus on productivity Be near customer All manufacturing in Asia 17
Slide 18: Knowles - Technology Expansion
Consumer Electronics Mobile Phone DSC / DVC Other (MP3, Gaming, etc) Laptop/Notebook Knowles - Technology Expansion 18
Slide 19: Result: SiSonic Volume and Scale
Result: SiSonic(tm) Volume and Scale Capacity expansion and productivity activities have enabled SiSonic(tm) production volumes to keep pace with demand 1,000,000,000th SiSonic(tm) shipped 19
Slide 20: DEK - Market Expansion
DEK - Market Expansion Leveraging DEK capabilities for organic growth in Solar process solutions Adapt printing process expertise to related application Capitalize on modular engineering design to effectively manufacture product Global infrastructure (especially in China) allows us to serve customer
Slide 21: DEK - Solar Cell is a Rapid Growth Market
DEK - Market Expansion Solar Cell is a Rapid Growth Market DEK's Solar Growth is Outpacing the Market Est. 2009 revenue: ~$600M CAGR +30% China fastest growing marketplace Germany highest installed base Top 5 customers: First Solar, Suntech,Q-Cells, Sharp, JA Solar Accuracy Lead time Support infrast
Slide 22: Focused on Total Customer Satisfaction
Focused on Total Customer Satisfaction 22 Positive Displacement Pump Customer Value Enhancement of the Year Distinguished Supplier Award Ozone Layer Protection Award 2009 Global Supplier Award Distinguished Partner Award Supplier Continuous Quality Award
Slide 23: Thank You
Thank You
Slide 24: Fluid Management - OPW Fueling Components
FLUIDMANAGEMENT ad OPW Fueling Components
Slide 25: OPW History
OPW History 25 1892 Founded 1961 Acquired by Dover 1986 Divided into standalone companies Knappco - 1997 Midland - 1998 (Acquired by Dover 1994) Sure Seal - 1999 Beltech - 2000 Epsilon - 2005 Hiltap - 2008 Pomeco - 1991 Sherex - 1991 Hasstech - 1995 Petrovend - 1998 (Acquired by Dover 1988) Brevetti
Slide 26: OPW Global Mission
OPW Global Mission 26 (tm) Revolutionizing fueling operations globally by optimizing safety, efficiency, reliability, and environmental sustainability through innovative fuel handling and information management solutions. Environmental Sustainability is a Cornerstone of OPW's Purpose & Product Offer
Slide 27: OPW's Three Business Units
OPW's Three Business Units 27 FCS BELOW GROUND PRODUCTS Environmentally secure underground fuel delivery & containment solutions designed to help protect the well-being of people and the environment. FCC ABOVE GROUND PRODUCTS OPW above ground fueling components & systems, set the industry standard i
Slide 28: OPW Global Operations
OPW Global Operations 28 Sales Offices • • Manufacturing Facilities: U.S., South America, Europe & Asia • • • • • • Chicago, IL Cincinnati, OH Smithfield, NC Mexico City, Mexico Itatiba, Brazil Klasterec, Czech Republic Krakow, Poland Beijing, China Shanghai, China Chengdu, China Suzhou, China Taipe
Slide 29: Macro-Level: Growth Drivers for OPW
Macro-Level: Growth Drivers for OPW 29 GLOBAL INFRASTRUCTURE GROWTH & ENERGY DEMAND INCREASING USE OF ALTERNATIVE FUELS GROWING DEMAND FOR AUTOMATION AND ASSET ACCOUNTABILITY INCREASING ENVIRONMENTAL REGULATIONS & SAFETY COMPLIANCE All four drivers are trending positive for OPW Trending will remain
Slide 30: OPW Core Competencies and Competitive Advantage
OPW Core Competencies and Competitive Advantage 30 Breadth of Product Global Footprint Operational Excellence Product Development & Innovation 30
Slide 31: What's New at OPW
What's New at OPW 31 PetroLink, RFID Fleet System Targeted for world market Rapidly growing fleet segment Launched: Q2 2010 New larger facility in Suzhou, China OPW moving lines to China Positioned to capture market growth Moved in to new facility Q3 2009 New facility in Chennai, India Nozzles, acce
Slide 32: Lean Initiative: Enterprise-Level Reduction of Complexity
Lean Initiative: Enterprise-Level Reduction of Complexity 32 Divested OPW UK completed 02/09 Took Contingency Actions to resize OPW FC completed 03/09 Re-Organization in US 6 BU structure to 3 BU's completed 03/09 Consolidated 2 Latin American sales teams into 1 completed 08/09 Facility Rationalizat
Slide 33: Benefits of Common Ownership
Benefits of Common Ownership 33 Dover Strategic Sourcing Initiative Target of $2.0M+ annual savings for OPW Dover China Regional Headquarters Helped OPW's move in 2009, OPW is moving into Dover Beijing office in 2010 Dover INTEGRITYCOUNTS Comprehensive and effective compliance processes DFM Technolo
Slide 34: Outlook for the Future
Outlook for the Future 34 Global market trends driving growth in our business: Infrastructure Growth, Energy Demand Environmental Regulations & Safety Compliance Automation, Asset Accountability & Control Significant growth in the emerging economies Ahead of the curve and ready for alternative and f
Slide 35: One Company. One World. One Source.
© SEED eeuiwanacemenr OoOPWwWw= SS ‘nove comer ONE COMPANY. ONE WORLD. ONE SOURCE.
Slide 36: Dover Investors Day Presentation
36 DOVER INVESTORS DAY PRESENTATION
Slide 37: Ceramic & Microwave Products General Overview
Ceramic & Microwave Products General Overview Communications based specialty products for aerospace, military, medical, and telecommunication markets Engineered components and subsystems based on RF and microwave capacitors, filters, and switches Program and design win driven 37 We are a leading glo
Slide 38: Ceramic & Microwave Products
Ceramic & Microwave Products 38 Hi-Q capacitors, thin film filters, heat sinks Low insertion loss, Hi-reliability switches & switch matrices Microwave & RF filters, switch filter banks & multifunction assemblies High performance capacitors; Hi-voltage, Hi-reliability & Hi-Temp Cosite interference so
Slide 39: Enabling Communication & Signal Control
Enabling Communication & Signal Control Military, Medical, Telecom & Industrial Markets Engineered applications requiring design Usually single source, or one of two sources 39
Slide 40: CMP Products
CMP Products 40 40 11% Switches 42% Capacitors 31% Microwave & RF Filters 16% ICE, MFA & Matrix Milcoms, space, test equipment Military Communications Anti-IED, EW, Mil Radio, Radar, Telecom Infrastructure Mil Radio, Medical Implant, MRI, Telecom Infrastructure, Industrial Equipment
Slide 41: CMP Markets
CMP Markets 41 9% Medical All Markets Driven by Engineering Design Wins 10% Industrial 23% Telecom Infrastructure 58% Military & Space 7% China 9% Asia 15% Europe 69% NAFTA
Slide 42: CMP Markets and Customers
Tre ELECTRONICTECHNOLOGIES eee Military Raytheon CMP Markets Telecom Infrastructure Industrial Siemens Medical St.Jude Harris Ericsson ‘Schneider Medtronic nT Motorola Siegert Boston Scientific Boeing ZTE Emerson Greatbatch Lockheed Martin Finisar Schlumberger Zarlink SRC Tec Oclaro Efore GE Medical
Slide 43: Dover Investors Day Presentation
43 DOVER INVESTORS DAY PRESENTATION
Slide 44: General Overview
General Overview 44 Specialize in the design and manufacture of custom microwave and radio frequency filters used to segregate frequencies 85% of product is used in military communications, electronic warfare and radar systems 40 years of expertise in creating innovative filtering solutions 380K Pro
Slide 45: General Overview: K&L filters and assemblies
General Overview 45 K&L filters and assemblies are used in many of today's military electronic warfare systems Cavity filters and assemblies are integrated into Cellular base stations Filter Switched Filter Military Electronic Warfare System Cavity Filters and Assemblies Motorola Universal Base Stat
Slide 46: Programs We Support
Programs We Support 46 DDG-51 Base Stations DDG-1000 F-22 ESSM GPS III CREW SL-AMRAAM PATRIOT F-35 EA-18G Test Equipment
Slide 47: Future Revenue Generators
Future Revenue Generators 47 Space Flight Filters Approximate Filter Market $100 Million K&L has substantial heritage to build on Significant In-House Testing Capability Automated Test Equipment High sell price Significant synergy opportunity with Dow-Key Tunable Multicoupler Used to combine radios
Slide 48: Trends That Will Help Us Grow
Trends That Will Help Us Grow 48 Need to operate communication equipment in presence of Anti-IED jammers Filtering solutions clear frequency spectrum for communications Increasing presence in space market segment K&L's extensive In-House testing capability and space heritage give us leverage Advance
Slide 49: What's New
What's New 49 Increased waveguide design capability for high frequency & more exotic filters Filters for testing extremely low Passive Intermodulation levels of Base Stations "Mixed Technology" applications combining properties of multiple filter topologies
Slide 50: RF Cosite Communication Solutions
50 DOVER INVESTORS DAY PRESENTATION RF Cosite Communication Solutions
Slide 51: General Overview
General Overview Specialize in mitigation of interference caused by the simultaneous operation of many collocated radios 95% of business is in the military communications market. Founded in 1989, acquired by Dover in 2007 $35M in revenue, 170 employees 51
Slide 52: Integrated Cosite Equipment (ICE) on military platforms
Our Integrated Cosite Equipment (ICE) can be found on most military command and control platforms General Overview Pole/Zero filters are integrated into many of today's military radios 52 PZ filter Military Radio PZ filter P-8 Aircraft
Slide 53: Programs We Support
Programs We Support 53 LCS P-8 BAMS CV-22 RRSVS TACP FALCON II VH-71A E-2D A2C2S JSTARS DMR E-6B
Slide 54: Future Revenue Generators
Future Revenue Generators P-8 Aircraft 100 domestic aircraft through 2020 = $100M revenue Substantial international sales expected 54 Tactical Air Control Party (TACP) 800 domestic systems = $30M revenue 25% Synergy content (K&L & Dow-Key) Substantial international sales opportunities E-2D Aircraft
Slide 55: Trends That Will Help Us Grow
Trends That Will Help Us Grow Battlespace Awareness & Network Centric Battlefield initiatives are driving up radio density on Military platforms Creates increased bandwidth congestion and need for PZ solutions PZ's extensive Product Portfolio addresses the Military shift toward the 75% solution (exi
Slide 56: Dover Investors Day Presentation
DOVER INVESTORS DAY PRESENTATION 56
Slide 57: Who is Hydro?
Who is Hydro? Manufacturer of proportioning and dispensing equipment for the specialty chemicals industry Global leader in a truly niche market $15M $75M sales since Dover acquired in 1997 Manufacturing in U.S., Europe, Brasil, Australia, China Sao Paulo, Brasil Bracknell, England Sydney, Australia
Slide 58: What Do We Make and Where Is It Used?
What Do We Make and Where Is It Used? Bottle and Bucket Filling Systems Foam Cleaning Vehicle Care Animal Care Water Treatment Sink Systems Mobile Floor Care 58
Slide 59: Channel to Market
Channel to Market Channel to Market 59
Slide 60: What Are We Truly Great At?
What Are We Truly Great At? Market leading design and innovation Speed to launch (from ideation) Manufacturing response and flexibility Note: Annual spend on R&D averages 6-7% of sales. 60
Slide 61: Trends Supporting Growth
Trends Supporting Growth Rising global sanitation standards Green movement, Sustainability, Water conservation Economics of dispensed chemicals (concentrates) Note: Hydro was one of two Dover companies with organic growth in 2009. 61
Slide 62: What's New?
What's New? WT Controller AccuPro ICS Series HydroDose Solids Dissolvers Total Eclipse 62
Slide 63: Lean practices and space creation
Lean practices and space creation $15M $60M sales, same space Nova consolidation (25,000 sq. ft.) Chemilizer acquisition (20,000 sq. ft.) Manufacturing area ownership Engaged workforce with focus on continuous improvement Tour Highlights 63
Slide 64: Hydro's Bounty From The New Dover
Hydro's Bounty From The "New Dover" Strategic focus on acquisitions and accelerated growth $1.2M/year in supply chain savings to bottom line (8% of PTI) Management training and development - "The Chuck Kearney Experience" 64
Slide 65: Remember This About Hydro
Remember This About Hydro Our products help keep your world clean and safe 65
Slide 66: Thank You
Thank You