Slide 1: Third Quarter 2013 Earnings Conference Call
Third Quarter 2013 Earnings Conference Call October 17, 2013 - 9:00am CT
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 by referring to our Forms 10-K and 10-Q for a list of factors that could cause our
Slide 3: Q3 2013 Performance
$0.60 $0.90 $1.20 $1.50 $1.80 Q1* Q2 Q3* Q4* Q1* Q2* Q3* Q3 2013 Performance Continuing Earnings Per Share • Strong revenue growth in refrigeration and drilling markets; solid growth in consumer electronics, downstream, fluids and Printing & Identification markets • North America markets are strong;
Slide 4: Revenue Growth Q3 2013 and 9M 2013
4 Revenue Q3 2013 Communication Technologies Energy Engineered Systems Printing & Identification Total Dover Organic 4% 3% 3% 3% 3% Acquisitions - 1% 9% - 4% Currency - -1% 1% 1% - Total 4% 3% 13% 4% 7% 9M 2013 Communication Technologies Energy Engineered Systems Printing & Identification Total Dove
Slide 5: Sequential Results – Q2 13 to Q3 13
$777 $778 $251 $257 $401 $414 $573 $577 $227 $227 $0 $350 $700 $1,050 DCT Q2 DCT Q3 DE Q2 DE Q3 DES Q2 DES Q3 DPI Q2 DPI Q3 $785 $662 $259 $256 $422 $424 $526 $595 $213 $222 $0 $350 $700 $1,050 DCT Q2 DCT Q3 DE Q2 DE Q3 DES Q2 DES Q3 DPI Q2 DPI Q3 Sequential Results – Q2 13 → Q3 13 Fluid Solutions ↑
Slide 6: Communication Technologies
6 Communication Technologies • Solid growth in Consumer Electronics markets, particularly smart phones, led by new product launches • Consumer electronics volume impacted by timing of launch and late product specification changes • Telecom/Other and Medical Technology markets improve; Aerospace/Defe
Slide 7: Energy
7 Energy • Strong drilling and downstream growth; Production impacted by weak winch markets, the timing of shipments and soft U.S. activity; Artificial Lift business remains solid with 3% organic growth • International markets remain robust • Margin reflects favorable product mix, productivity and s
Slide 8: Engineered Systems
8 Engineered Systems • Record revenue driven by recent acquisitions, and strong results in the refrigeration & food equipment, fluids and waste handling markets • Anthony continues to benefit from its close-the-case activity • Margin performance reflects strong execution • Bookings growth reflects a
Slide 9: Printing & Identification
Printing & Identification • Revenue growth in both fast moving consumer goods and industrial end-markets • Strong growth in China and Europe •Operating margin continues to increase on volume, the benefits of prior restructuring and a continued focus on productivity • Bookings growth reflects growth
Slide 10: Q3 2013 Overview
Q3 2013 Overview Q3 2013 Net Interest Expense $30 million, essentially flat with last year Corporate Expense $43 million, up $11 million from last year, reflecting Q3 spin off costs and $4 million in pension curtailment gains. Effective Tax Rate (ETR) Q3 normalized rate was 28.7%, excluding $0.03 ce
Slide 11: FY 2013 Guidance – Revenue Growth by Segment
FY 2013 Guidance – Revenue Growth by Segment 11 Segment 2012 Revenue Mix 2013F Organic Growth 2013F Acquisition Growth* Total Communication Technologies 19% 6% - 7% - 6% - 7% Energy 27% ≈ 3% ≈ 3% ≈ 6% Engineered Systems 42% ≈ 2% ≈ 8% ≈ 10% Printing & Identification 12% 1% - 2% - 1% - 2% Total ≈ $8.1
Slide 12: FY 2013 Guidance
FY 2013 Guidance Revenue: • Organic revenue : ≈ 3% • Acquisitions: ≈ 4% • Total revenue: ≈ 7% Corporate expense: ≈ $150 million Interest expense: ≈ $123 million Full-Year Tax Rate: ≈ 27.8%(a) Capital expenditures: ≈ 3% of revenue FCF for full year: ≈ 10% of revenue 12 2013 EPS from conti
Slide 13: 2013 EPS Guidance Bridge - Cont. Ops
2012 EPS – Continuing Ops $4.53 • Less 2012 tax benefits (1): ($0.09) 2012 Adjusted EPS – Continuing Ops $4.44 • Volume, mix, price (inc. FX): $0.30 - $0.33 • Net benefits of productivity: $0.25 - $0.28 • Acquisitions: $0.11 - $0.12 • Investment / Compensation: ($0.18 - $0.20) • Corporate expens
Slide 14: Appendix – Reconciliations
Appendix – Reconciliations 14 EPS – Continuing Ops $1.53 $4.34 • Discrete tax items: ($0.03) ($0.41) • Knowles spin-off costs: $0.06 $0.08 • Other one-time gains: ($0.02) ($0.02) Adjusted EPS – Continuing Ops $1.54 $4.00 Q3 2013 9 Months 2013 ADJUSTED EPS FROM CONTINUING OPERATIONS Note: Per sha
Slide 15: Appendix – Guidance Reconciliations
Prior Guidance – EPS from Continuing Ops $5.56 - $5.71 • Third & fourth quarter performance: $0.02 - ($0.06) • Q3 Discrete tax items: $0.03 • Q3 Knowles spin-off costs: ($0.06) • Q3 Other one-time items: $0.02 Updated Guidance – EPS from Continuing Ops $5.57 - $5.64 Appendix – Guidance Reconcili