Slide 1: Q1 2017 Earnings
Q1 2017 Earnings January 25, 2017
Slide 2: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures Forward-Looking Statements This presentation contains certain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject
Slide 3: Q1 Highlights
Q1 Highlights Very strong performance reflects benefit of harsh portfolio • 7% year-over-year organic growth • Sales of $3.1B, with strength in Asia • Double digit organic growth in Transportation, with content growth driving market outperformance • Strengthening Industrial markets and organic growt
Slide 4: Segment Orders Summary
Segment Orders Summary ($ in millions) FY16 FY16 FY17 Q1 Q4* Q1 13 Week Transportation 1,583 1,704 1,775 • Transportation Y/Y growth driven by strength in China and EMEA Industrial 726 829 832 • Industrial Y/Y growth driven by Aerospace, Communications Defense, Medical and 406 413 417 Ex SubCom Indu
Slide 5: Transportation Solutions
Transportation Solutions $ in Millions Sales Business Performance Reported Y/Y Growth Rates Reported Organic Up 11% $1,675 Automotive $1,275 12% 13% Organic $1,507 Commercial 213 15% 16% Up 11% Transportation Q1 2016 Q1 2017 Sensors 187 3% (1)% Reported Organic Transportation $1,675 11% 11% Orders $
Slide 6: Industrial Solutions
Industrial Solutions $ in Millions Sales Business Performance Reported Y/Y Growth Rates Reported Organic Up 12% Industrial Equipment $383 33% 1% $795 Organic Aerospace & $709 226 4% 4% Defense Flat Q1 2016 Q1 2017 Oil and Gas 26 (24)% (21)% Reported Organic Energy 160 (5)% (3)% Orders $832 15% 4% In
Slide 7: Communications Solutions
Communications Solutions $ in Millions Sales Business Performance Reported Y/Y Growth Rates Reported Organic Down 4% Data & Devices $231 (13)% 2% $617 $593 Organic Appliances 148 13% 14% Up 3% Q1 2016 Q1 2017 SubCom 214 (4)% (4)% Communications Reported Organic $593 (4)% 3% Solutions Orders ex SubCo
Slide 8: Q1 Financial Summary
Q1 Financial Summary ($ in Millions, except per share amounts) Q1 FY16 Q1 FY17 Net Sales $ 2,833 $ 3,063 Operating Income $ 398 $ 486 Operating Margin 14.0% 15.9% Acquisition Related Charges 6 3 Restructuring & Other Charges, net 40 47 Adjusted Operating Income $ 444 $ 536 Adjusted Operating Margin
Slide 9: Q1 Operating Metrics
Q1 Operating Metrics $ in Millions Adjusted Gross Margin Percentage Free Cash Flow 34.8% 33.4% $237 $218 Q1 2016 Q1 2017 Q1 2016 Q1 2017 Adjusted Operating Margin Adjusted EBITDA Margin 17.5% 22.7% 15.7% 20.8% Q1 2016 Q1 2017 Q1 2016 Q1 2017 9 Adjusted Gross Margin Percentage, Free Cash Flow, Adjust
Slide 10: Q2 Outlook
Q2 Outlook Guidance* Highlights • Mid single digit organic growth expected on 2% Transportation Up Low Single Digits global auto production growth, with growth in Asia Solutions Up Mid Single Digits Organic and EMEA • Commercial Transportation growth above market with strength in Asia heavy trucks I
Slide 11: FY17 Outlook vs 52 week prior year
FY17 Outlook* vs 52 week prior year Guidance* Highlights • Transportation organic growth increases from prior view due to strength in China; Expect 2% global auto Transportation Up Low Single Digits production growth up from 1%; Continue to expect Solutions strong growth Commercial Transportations a
Slide 12: Additional Information
Additional Information 12
Slide 13: Current vs. Prior Guidance
Current vs. Prior Guidance Q1 FY17 FY17 Sales Adjusted Sales Adjusted (in millions) EPS (in millions) EPS Guidance Provided in $3,000 $1.00 $12,600 $4.34 November Operational Performance 108 0.17 110 0.22 FX Impact (45) (0.02) (310) (0.16) Q1 2017 Results / $3,063 $1.15 $12,400 $4.40 Current 2017 Gu
Slide 14: Y/Y Q1 2017 Adjusted EPS
Y/Y Q1 2017 Sales Adjusted (in millions) EPS Q1 2016 Results $2,833 $0.84 Operational Performance 186 0.30 Acquisitions / Divestitures, net 69 0.02 FX Impact (25) (0.01) Q1 2017 Results $3,063 $1.15 14 Adjusted EPS is a non-GAAP measure; See Appendix for description and reconciliation.
Slide 15: Y/Y Q2 2017 Adjusted EPS of $1.05 – $1.09
Y/Y Q2 2017 Sales Adjusted (in millions) EPS Q2 2016 Results $2,952 $0.90 Operational Performance 112 0.17 Acquisitions / Divestitures, net 74 0.03 FX Impact (63) (0.03) Q2 2017 Guidance $3,075 $1.07 Guidance Range: Sales of $3.025B - $3.125B Adjusted EPS of $1.05 – $1.09 15 Adjusted EPS is a non-GA
Slide 16: Y/Y 2017 vs 2016 – 52 Weeks
Y/Y 2017 1H 2H FY17 Sales Adjusted Sales Adjusted Sales Adjusted (in millions) EPS (in millions) EPS (in millions) EPS 2016 – 52 Weeks $5,785 $1.74 $6,215 $2.22 $12,000 $3.95 Operational 298 0.28 214 0.14 512 0.43 Performance Acquisitions / 143 0.05 45 0.03 188 0.08 Divestitures, net* Share Repurcha
Slide 17: Q1 Balance Sheet & Cash Flow Summary
Q1 Balance Sheet & Cash Flow Summary Free Cash Flow and Working Capital Liquidity, Cash & Debt ($ in Millions) ($ in Millions) Q1 2016 Q1 2017 Q1 2016 Q1 2017 Cash from Continuing Operations $391 $404 Beginning Cash Balance $3,329 $647 Free Cash Flow 237 218 Capital expenditures, net (138) (126) Div
Slide 18: Appendix
Appendix 18
Slide 19: Non-GAAP Measures
Non-GAAP Measures “Organic Net Sales Growth,” “Organic Net Sales Growth Excluding the Impact of the Additional Week,” “Net Sales Excluding the Impact of the Additional Week,” “Net Sales Growth Excluding the Impact of the Additional Week,” “Net Sales in Constant Currency,” “Adjusted Gross Margin,” “A
Slide 20: Non-GAAP Measures (cont.)
Non-GAAP Measures (cont.) Adjusted Income Tax Expense – represents income tax expense (the most comparable GAAP measure) after adjusting for the tax effect of special items including charges related to restructuring and other charges, acquisition related charges, impairment charges, other income or
Slide 21: Segment Summary for the Quarter Ended December 30, 2016
Segment Summary for the Quarter Ended December 30, 2016 Net Sales O perating Adjusted O perating For the Q uarters Ended Y/Y Y/Y O rganic Margin for the Margin for the December 25, December 30, Sales Sales Q uarter Ended Q uarter Ended Segment 2015 2016 Growth Growth (1) December 30, 2016 December 3
Slide 22: Reconciliation of Net Sales Growth – Q1 17 vs. Q1 16
Reconciliation of Net Sales Growth– Q1 17 vs. Q1 16 Percentage of Change in Net Sales for the Q uarter Ended December 30, 2016 Segment's Total versus Net Sales for the Q uarter Ended December 25, 2015 Net Sales for the Acquisitions Q uarter Ended (1) (2) Total Translation (Divestiture) O rganic Dece
Slide 23: Reconciliation of Non-GAAP Measures, Quarter Ended December 30, 2016
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended December 30, 2016 Adjustments Acquisition Restructuring Related and O ther Tax Adjusted (1) (1) (2) U.S. GAAP Charges Charges, Net Items (Non-GAAP) (3) ($ in millions, except per share data) Operating Inco
Slide 24: Reconciliation of Non-GAAP Measures, Quarter Ended September 30, 2016
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended September 30, 2016 Adjustments Restructuring Acquisition and O ther Related Charges Adjusted U.S. GAAP Charges (1)(2) (Credits), Net (2) (Non-GAAP) (3) ($ in millions, except per share data) Operating Inco
Slide 25: Impact of Additional Week for Q4 2016
Impact of Additional Week for Q4 2016 Change in Ne t Sale s for the Q uarte r Ende d Change in O rganic Ne t Sale s for the Q uarte r Ende d Se pte mbe r 30, 2016 ve rsus Ne t Sale s for the Se pte mbe r 30, 2016 ve rsus O rganic Ne t Sale s for the For the Q uarte r Ende d Se pte mbe r 30, 2016 Q u
Slide 26: Reconciliation of Non-GAAP Measures, Quarter Ended June 24, 2016
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended June 24, 2016 Adjustments Acquisition Restructuring Related and O ther Tax Adjusted U.S. GAAP Charges (1)(2) Charges, Net (2) Items (3) (Non-GAAP) (4) ($ in millions, except per share data) Operating Incom
Slide 27: Reconciliation of Non-GAAP Measures, Quarter Ended December 25, 2015
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended December 25, 2015 Adjustments Acquisition Restructuring Related and O ther Tax Adjusted U.S. GAAP Charges (1) Charges, Net (1) Items (2) (Non-GAAP) (3) ($ in millions, except per share data) Operating Inco
Slide 28: Reconciliation of Non-GAAP Measures, Year Ended September 30, 2016
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Year Ended September 30, 2016 Adjustments Restructuring Acquisition and O ther Related Charges Tax Adjusted U.S. GAAP Charges (1)(2) (Credits), Net (2) Items (3) (Non-GAAP) (4) ($ in millions, except per share data) Ope
Slide 29: Impact of Additional Week for Fiscal 2016
Impact of Additional Week for Fiscal 2016 Change in Ne t Sale s for Fiscal 2016 Change in O rganic Ne t Sale s for Fiscal 2016 Fiscal 2016 ve rsus Ne t Sale s for Fiscal 2015 ve rsus O rganic Ne t Sale s for Fiscal 2015 (2) Adjustme nt Adjustme nt Adjustme nt 53 We e ks Impact of 52 We e ks 53 We e
Slide 30: Reconciliation of Non-GAAP Measures, Quarter Ended March 25, 2016
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures for the Quarter Ended March 25, 2016 Adjustments Restructuring Acquisition and O ther Related Charges Tax Adjusted U.S. GAAP Charges (1) (Credits), Net (1)(2) Items (Non-GAAP) (3) ($ in millions, except per share data) Operatin
Slide 31: Reconciliation of Gross Margin & Gross Margin Percentage
Reconciliation of Gross Margin & Gross Margin Percentage For the Q uarters Ended December 25, December 30, 2015 2016 ($ in millions) Net Sales $ 2,833 $ 3,063 Cost of Sales 1,888 1,998 Gross Margin 945 1,065 Gross Margin Percentage 33.4% 34.8% Acquisition Related Charges 1 1 Adjusted Gross Margin (1
Slide 32: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow For the Q uarters Ended December 25, December 30, 2015 2016 (in millions) Net cash provided by operating activities: Net cash provided by continuing operating activities $ 391 $ 404 Net cash used in discontinued operating activities (1) - 390 404 Net cash used in inv
Slide 33: Reconciliation of Adjusted EBITDA Margin
Reconciliation of Adjusted EBITDA Margin For the Q uarters Ended December 25, December 30, December 28, 2015 2016 2012 ($ in millions) Net Income $ 353 $ 409 $ 277 (Income) from discontinued operations (29) (3) (18) Income tax expense (benefit) 58 54 (255) Other (income) expense, net (8) - 226 Inter
Slide 34: Reconciliation of Forward-Looking Non-GAAP Financial Measures
Reconciliation of Forward-Looking Non-GAAP Financial Measures to Forward-Looking GAAP Financial Measures O utlook for O utlook for O utlook for the Six Months the Six Months Q uarter Ending Ending Ending March 31, March 31, September 29, 2017 (1) 2017 (1) 2017 (1) Diluted earnings per share from con