Enerpac Tool Group Corp. · NYSE:EPAC
Enerpac Tool — Q4 2021 Earnings Presentation
21 slides from Enerpac Tool's earnings presentation, Sep 29, 2021
Slide 1: Fiscal 2021 Fourth Quarter Earnings
Fiscal 2021 Fourth Quarter Earnings September 29, 2021 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements in this presentation that are not historical are considered “forward-looking statements” and are subject to change based on various factors and uncertainties that may cause actual results to differ significantly from expectations. Those factors are contained in
Slide 3: Fiscal 2021 Fourth Quarter – Executing on Key Priorities
Fiscal 2021 Fourth Quarter – Executing on Key Priorities Safety Remains #1 Concern ▪ COVID continues to be a challenge globally, restrictions continue to impact certain parts of the world ▪ Enhanced COVID testing procedures in many plants Financial Highlights ▪ Continue year-over-year growth with IT
Slide 4: Market Update
Market Update Product Net Sales IT&S Consolidated Product Net Sales* The pressure wave shows that (pre-COVID) by May we were (pre-COVID) squarely back in the middle of the five-year pre- COVID sales range for IT&S product sales 4 *includes acquisitions from date of purchase and excludes strategic ex
Slide 5: Fourth Quarter 2021 Summary
Fourth Quarter 2021 Summary Financials ▪ Sales: $145M ▪ Core sales growth of 28% ▪ Adjusted EBITDA incremental margins of 44%, excluding the impact of currency, at the high-end of our target range of 35-45% ▪ Adjusted Diluted EPS: $0.19 ▪ Free Cash Flow: $27M of cash generated compared to $10M gener
Slide 6: Transformational Years (Fiscal 2016-2021)
Transformational Years (Fiscal 2016-2021) 2016: Small cap diversified industrial company including 3 segments ▪ Industrial ▪ Energy ▪ Engineered Solutions (ES) 2017 - 2018: Reorganized segments ▪ Combined Industrial & Energy ▪ Formed Engineered Components & Solutions (EC&S) segment with significant
Slide 7: Regional Update
Regional Update Americas / Europe ▪ Year-over-year core growth in both regions ▪ Product sales strong in both regions ▪ Strong service quarter in Europe related to major outages in the North Sea ▪ Key Verticals ▪ Positive trends continue in Power Generation, Rail, Construction and General Industrial
Slide 8: Regional Update and Operations
Regional Update and Operations Middle East/North Africa/Caspian (MENAC) ▪ Year-over-year core growth ▪ COVID related border lockdowns and restrictions on travel continue to affect labor availability and movement ▪ Continued recovery of service sales with maintenance projects starting to pick up ▪ St
Slide 9: Fourth Quarter 2021 Comparable Results
Fourth Quarter 2021 Comparable Results (US$ in millions except EPS) $143 $145 17.1% NET SALES 16.6% $111 • Core sales growth of 28% 9.4% • IT&S product sales 22% • Other product 28% • New Product Development (NPD) – 6 new product families launched • NPVI of ~13% Q4 2020 Q3 2021 Q4 2021 Q4 2020 Q3 20
Slide 10: Net Sales Waterfall
Net Sales Waterfall* (US$ in millions) $160 $140 $10.6 $145.4 $20.1 $120 $2.3 $1.0 We continue to be $100 $111.4 encouraged by the level of product volume that we saw during the $80 quarter as our primary end markets showed strong recovery in our $60 largest regions of the world and moderate recover
Slide 11: Adjusted EBITDA Waterfall
Adjusted EBITDA Waterfall* (US$ in millions) $40 $35 Adjusted EBITDA $5.1 $9.2 benefited from higher volumes and $30 restructuring savings $5.6 partially offset by the year-over-year decrease $25 $2.4 in COVID related $13.5 temporary cost savings $24.2 put in place to offset $20 12.3% 13.3% reduced
Slide 12: Supply Chain Update
Supply Chain Update Execution ▪ Lead times expanded due to increased demand and material shortages ▪ Leveraging 2nd and 3rd supplier relationships ▪ Extended lead times resulted in $4-5 million of shippable back log ▪ Expect supply and logistics challenges at least through the first half of fiscal 2
Slide 13: Liquidity – Positioned for Success
Liquidity – Positioned for Success (US$ in millions) $35 $255 $152 1.8 $27 $195 $175 $140 1.1 $136 $10 0.6 Q4 2020 Q3 2021 Q4 2021 Q4 2020 Q3 2021 Q4 2021 Q4 2020 Q3 2021 Q4 2021 Q4 2020 Q3 2021 Q4 2021 Free Cash Flow Cash Balance Gross Debt TTM Financial Leverage* Free Cash Flow (FCF) Debt & Levera
Slide 14: Expectations for Fiscal 2022
Expectations for Fiscal 2022 Expectations for Fiscal 2022: ▪ Sales in the range of $590 million to $610 million ▪ Projected year-over-year core growth by category We are cautious as ▪ IT&S Product ~ low to mid teens% we progress into fiscal 2022 but are ▪ IT&S Service ~ low single digits% closely mo
Slide 15: Q&A
Q&A
Slide 16: Appendix
Appendix
Slide 17: Historical Sales Seasonality
Historical Sales Seasonality 28% ITS Product Sales Seasonality Trend 2016 - 2019 Q1 and Q2 sales 26% seasonally low, Q3 sales followed by Q4 typically 24% strongest; HLT projects can create 22% lumpiness in the trend 20% Q1 Q2 Q3 Q4 North Sea/MENAC 34% Service Sales Seasonality Trend drive Q1/Q3 hig
Slide 18: Fourth Quarter 2021 GAAP vs Non-GAAP Reconciliation
Fourth Quarter 2021 GAAP vs Non-GAAP Reconciliation (US$ in millions except EPS) The summation of individual components may not equal the total due to rounding Less Impairment & Divestiture GAAP Charges Adjusted Sales $145.4 $145.4 Operating Profit $13.6 ($5.7) $19.3 Income Taxes $5.9 ($0.6) $6.4 Ne
Slide 19: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures (US$ in millions) Adjusted EBITDA Free Cash Flow Q4 Q4 2021 2020 Net Earnings $7 $0 0 Full Year Full Year Net Financing Costs $1 $3 2021 2020 Income Taxes $6 $1 Depreciation & Amortization $5 $5 Cash From Operations $ 54 $ (3) Capital Expenditures $ (12) $ (12) Re
Slide 20: Adjusted Operating Profit Waterfall
Adjusted Operating Profit Waterfall* (US$ in millions) $35 Adjusted $30 Operating Profit benefited from $5.0 $9.2 higher $25 volumes/mix and restructuring $5.6 savings partially $20 offset by the $1.3 year-over-year $13.5 $19.3 decrease in COVID related $15 temporary savings $10 $5 $1.3 $0.2 $4.6 $0
Slide 21: Enerpac Tool Group
ENERPAC (7) TOOL GROUP