Enovis Corporation · NYSE:ENOV
Enovis — Colfax — Investor Day (March 2021)
97 slides from Enovis's investor day presentation, Mar 11, 2021
Slide 1: Colfax Corporation Investor Day March 11, 2021
Exhibit 99.1 Colfax Corporation Investor Day March 11, 2021 Exhibit 99.1 Colfax Corporation Investor Day March 11, 2021
Slide 2: Forward Looking Statement & Non-GAAP Disclaimer
Forward Looking Statement & Non-GAAP Disclaimer These materials include “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be characterized by terms such as “believe,” “anticipate,” “should,” “would,” “intend,” “pla
Slide 3: Agenda
Agenda Q&A Logistics Mitch Rales 9:00 AM Chairman’s Introduction • Ask questions by clicking submit Matt Trerotola Colfax Capabilities, Strategic Direction 9:20 AM question, next to presenter box within the meeting 9:40 AM Q&A 10:00 AM Shyam Kambeyanda ESAB Strategy, Progress, Opportunities Olivier
Slide 4: Chairman's Introduction – Mitch Rales
Chairman’s Introduction – Mitch Rales 4Chairman’s Introduction – Mitch Rales 4
Slide 5: Separation Overview
Separation Overview th Announced on March 4 the intent to separate into two independent, publicly traded companies (completion targeted in the first quarter 2022) Creates focused specialty Medical Technologies and Fabrication Technology companies, positioning both to accelerate strategic momentum En
Slide 6: Re-Shaped Portfolio for Maximum Value Creation
Re-Shaped Portfolio for Maximum Value Creation 2017-2019 Transformation 2019-2020 Momentum 2021 - Future • Portfolio changes • Strengthened talent, accelerated • Leaders in attractive, growing MedTech capabilities markets • Created outperforming FabTech business • Invested in innovation and • Sustai
Slide 7: Two Great Companies, Well-Positioned for Success
Two Great Companies, Well-Positioned for Success Global Fabrication Technology Leader Specialty Medical Technology Innovator MedTechCo • >$30B market, global GDP + accelerators • >$50B market, healthcare growth drivers • Global leader with scale in all regions • Focused in attractive segments • Stro
Slide 8: Colfax Sustainable Model for Compounding Value Creation
Colfax Sustainable Model for Compounding Value Creation Talent Above-Market Sales Growth CBS / Continuous Improvement Compounding Margin Expansion Value Creation Innovation Healthy Free Cash Flow Acquisitions / Portfolio Shaping Each Business now has these Core Capabilities to Drive Superior Perform
Slide 9: Strong Cultures and Talent Processes
Strong Cultures and Talent Processes Our Talent Imperatives Our Culture Outstanding Talent 1 CBS-capable GMs and ops leaders; business-minded functional leads Full Bench 2 Depth & breadth for growth including acquisition integration Right Organization 3 Aligned for optimal performance & appropriatel
Slide 10: Strong Leadership Teams in Place to Drive Superior Performance
Strong Leadership Teams in Place to Drive Superior Performance ESAB MedTechCo Shyam Kambeyanda Matt Trerotola Brady Shirley President & CEO CEO President & COO Kevin Scott Michele Curtis Chris Hix Dan Pryor Patty Lang Brad Tandy CFO Strategy/BD GC CHRO Johnson Grisham Campion Jewell CFO Strategy/BD
Slide 11: Colfax Business System (CBS) Drives Continuous Improvement
Colfax Business System (CBS) Drives Continuous Improvement • Culture + Processes + Tools • Builds momentum over time • ESAB far into CBS journey, accelerating performance • DJO businesses now have CBS foundation, momentum building Both Companies Will Carry forward CBS Culture, Tools, and Processes 1
Slide 12: Demonstrated Innovation Engines
Demonstrated Innovation Engines Growing Digital Initiatives in Both Businesses • ESAB’s industry-leading innovation contributing to organic growth, share gain, higher margins • MedTechCo Reconstructive vitality high, supporting double-digit growth • MedTechCo Prevention & Recovery leading in clinic
Slide 13: Disciplined, Strategy-Driven Acquisition Process
Disciplined, Strategy-Driven Acquisition Process ESAB MedTechCo Channel/Global Specialty Alloys Robotics & Recovery Science Modalities Automation Solutions Surgical Workflow Digital Growth Foot/Ankle Medical & Specialty STAR Expansion Total ankle replacement Gas Control 7 acquisitions over past 5 ye
Slide 14: Colfax Model Drove Significant Improvement and Evolution
Colfax Model Drove Significant Improvement and Evolution ESAB, past 5 years MedTechCo, past 2 years Seasoned team, deep bench, CBS Retained and strengthened team, CBS Talent embedded in DNA journey well underway • Strong service, consistent productivity • Insourced distribution Supply Chains • Conso
Slide 15: Executing Our Strategy Compounds Value
Executing Our Strategy Compounds Value Great service + high vitality + commercial excellence leads to organic growth above market Margin expansion and cash conversion improvement driven by CBS, Great Markets, Strong Positions and Momentum supports ability to make strategic investments Successful acq
Slide 16: Realizing Our Vision
Realizing Our Vision ESAB Aspiration: MedTechCo Aspiration: MSD Core Growth HSD Core Growth 1 1 aEBITDA Margin >20% Mid-60’s GM%/aEBITDA Margin >25% 100%+ cash flow conversion, balanced allocation Strong cash flow, invest for growth Extend into attractive adjacencies ~$2.5B ~$1.7-$2B Accelerators ~$
Slide 17: Summary
Summary ✓ Taking the next logical step, given transformation of both businesses and opportunities ahead ✓ Strong momentum in both businesses ✓ Exciting visions for ESAB and MedTechCo ✓ Separation should enable both businesses to achieve visions and unlock value 17Summary ✓ Taking the next logical st
Slide 18: Q&A
Q&AQ&A
Slide 19: ESAB: Global Leader in Fabrication Technology
ESAB: Global Leader in Fabrication Technology INVESTOR DAY PRESENTATION MARCH 11, 2021ESAB: Global Leader in Fabrication Technology INVESTOR DAY PRESENTATION MARCH 11, 2021
Slide 20: Best Team Wins: ESAB Presenters
Best Team Wins: ESAB Presenters Shyam Kambeyanda Olivier Biebuyck Kevin Johnson Chief Executive Officer President EMEA, Equipment, and Digital Chief Financial Officer ▪▪▪ Solutions Joined ESAB in 2016 Joined ESAB in 2019 ▪▪ Joined ESAB in 2017 ▪ Previously worked at Eaton Corporation Experienced Col
Slide 21: A Premier Global Fabrication Technology Company
A Premier Global Fabrication Technology Company Organic Continuous Long-Term Growth Improvement Acquisitions Talent Strategic Goal Innovation Colfax Business Higher growth, higher Core values ▪▪▪▪ $3B+ System (CBS) gross margin, and lower Global Presence Attract and retain best cyclicality Revenue ▪
Slide 22: Broadest Portfolio, Full Solution Set, Leading Global Brands
We Shape the Future: Broadest Portfolio, Full Solution Set, Leading Global Brands ESAB Product Sales Mix Equipment Consumables 31% 2020 69% Most Sales Derived from Repeatable Sales of Consumable Products Best-Positioned to Meet Global Customer Needs 22 ESAB – A Fabrication Technology LeaderWe Shape
Slide 23: Diverse Global Market Supported by Favorable Secular Trends
Diverse Global Market Supported by Favorable Secular Trends Healthcare, Other General Infrastructure Automotive & Mobile Renewable Oil & Gas Laboratory, & (Defense, Fabrication & Constr. Vehicles Machinery Energy Process Ship, Rail) $25B Market Growth Drivers Market 1,2 Welder Shortage Driving Est.
Slide 24: Global Scale, Local Agility Drives Regional Growth and Profitability
Global Scale, Local Agility Drives Attractive Regional Growth and Profitability ESAB Geographic Sales Split (2020) Emerging #1 Russia Markets 50% 50% #1 Europe Developed Markets #1 China #3 North America #1 Middle (global player) East aEBITDA Margin (2020) #1 India Comparable Performance #1 South Am
Slide 25: Our Playbook is Outperforming the Industry
Our Playbook is Outperforming the Industry Global Share Out-Performing in 1 (2020) 2019 & 2020 Organic Innovation Engine ▪ Best-in-Class Light Industrial Equipment ▪ bps Modernized Heavy Industrial Equipment ▪ Digitally Connected Portfolio with WeldCloud ▪ Core Sales Organic Margin Improvement ~300
Slide 26: Strong Financial Performance & Resiliency
Strong Financial Performance & Resiliency 1 +200bps 7.7% 20% >100% aEBITDA Margin Improvement Sales CAGR 2020 Decremental 2020 FCF Pre-COVID (‘16-’19) Pre-COVID (‘16-’19) Margins Conversion 1 Sales, $B aEBITDA % ~17.0 - 17.5% 16.9% 16.4% 2.25 ~2.2 2.19 15.3% 15.0% 14.9% 1.95 1.94 1.80 2016 2017 2018
Slide 27: Investing & Gaining Momentum in North American Market
Investing & Gaining Momentum in North American Market 1 NAM Sales Growth NAM aEBITDA % Growth Drivers Increased Pace >250 bps +20% of Innovation Rebel Warrior Cutmaster Sentinel Commercial Leveraging CBS Sales Tools ▪ Effectiveness Talent Development & Upgrade ▪ Digital Marketing Outreach ▪ Strong C
Slide 28: The Colfax Business System (CBS) is a Competitive Advantage
The Colfax Business System (CBS) is a Competitive Advantage CBS – Our Values, Processes and Tools CBS Fundamentals Voice of the Customer – Customer-Centric ▪ Pricing – Dynamic Price Management ▪ Daily Management – Delivering on Customer Commitments ▪ Standard Work – Repeatable Processes ▪ Kaizen – C
Slide 29: Proven Acquisition Process Impact on ESAB
Proven Acquisition Process Impact on ESAB Exciting Acqusitions with Strategic Fit Overarching Goals Robotic & Industrial Digital Specialty Resilient in 2020 Automation Diversification Growth Alloys Solutions MSD Acquisition Growth Revenue of Acquired Businesses, Accretive $M to GM 2019 2020 Accretiv
Slide 30: Acquisitions & Innovation Shifting ESAB Exposure to High-Growth Segments
Acquisitions & Innovation Shifting ESAB Exposure to High-Growth Segments nd Medical & Specialty 2 Wave 1 Attractive Growth Vectors Gas Control Digital Solutions Robotics $3B+ Market $1B+ Market $1B+ Market ▪▪▪ Opportunity Opportunity $5B+ 6-8%+ MSD Growth ▪ Market Size Growth Profile Double-Digit Gr
Slide 31: 2018 Acquisition Delivering Growth and Margin Expansion
2018 Acquisition Delivering Growth and Margin Expansion Increased Exposure to Higher-Growth Markets Attractive Financial Performance Market Sales Mix 7%+ Specialty Gas Cutting & Welding Sales Control 32% Growth 30% 2018 2020 >350 bps 38% Medical & Digital aEBITDA Margin % 2018 2020 Additional Acquis
Slide 32: Innovation
Innovation 32 ESAB – A Fabrication Technology LeaderInnovation 32 ESAB – A Fabrication Technology Leader
Slide 33: Fabrication Technology Innovation Leader
ESAB – Fabrication Technology Innovation Leader nd Positioning for 2 Wave Robotic Core Business Innovations Growing Digital Offering Adoption Best-in-class new product Proprietary WeldCloud offerings Multi-brand robotics solution ▪▪▪ developments Clear value proposition to customers Leveraging ESAB’
Slide 34: Accelerating Pace of Innovation
Accelerating Pace of Innovation New Product Introductions (#) Transforming the Portfolio Leading Medical & High-Purity Specialty Gas Control Equipment +230% 80 Lower Fume, Higher Density-to-Strength Ratio, SMART Packaging Filler Metals 24 Digitally Connected Equipment through WeldCloud 2016 2020 Mod
Slide 35: Distinctive Products Shaping their Categories
Distinctive Products Shaping their Categories RobustFeed Renegade Rogue Portable, Long-Distance Compact, High-Powered High-Performance Professional & Industrial Wire Feeder Industrial MMA/TIG Welder Entry-Level MMA/TIG Welder Unmatched Performance: Superior wire Flexibility: Outstanding output power
Slide 36: CBS Accelerating Product Innovation
CBS Accelerating Product Innovation Strategic Planning 3-Year Roadmap & Stage-Gate Commercial Cycle Budget Prioritization Execution Ramp-up Prioritization Across Regions Stage Gates & Checklists Business Line Review Marcom Launch Material ▪▪ ▪▪ and Product Lines Business Case Creation Market Sizing
Slide 37: Digital Solutions Introduction Video
Digital Solutions Introduction Video https://vimeo.com/520960765/ec6534ea3c ▪ 37 ESAB – A Fabrication Technology LeaderDigital Solutions Introduction Video https://vimeo.com/520960765/ec6534ea3c ▪ 37 ESAB – A Fabrication Technology Leader
Slide 38: Digital Solutions is a Game-Changer for our Customers and ESAB
Digital Solutions is a Game-Changer for our Customers and ESAB Customer: Connected Devices (#) Insights Into Efficiency of Operations ▪ “Our arc time factor increased 50% Arc-Time / Deposition Rate ▪ with WeldCloud.” – Mobile Machinery Welding Time Per Operator ▪ Mfr. (Poland) Material Consumption +
Slide 39: Software & Digital Acquisitions Enabling Robotics Adoption
Software & Digital Acquisitions Enabling Robotics Adoption Octopuz OLP Software the Latest Addition to Total Solution Long-Term Benefits to ESAB Recurring Software Sales Complex Part Programming Made Simple ▪ Robotic Pull-Through Purus Robotic Programming Works with any Robot-OEM in the Factory ▪ Fi
Slide 40: Financial Performance
Financial Performance 40 ESAB – A Fabrication Technology LeaderFinancial Performance 40 ESAB – A Fabrication Technology Leader
Slide 41: CBS Driving Operational Excellence
CBS Driving Operational Excellence Price Change (%) Highlights – Improvements 2016 to 2020 5% 3% 1% 1% Dynamic Price/Cost Management ▪ 2016 2017 2018 2019 2020 -2% Delivered $33M in Footprint Savings ▪ Working Capital Improved by >1/2 Turn ▪ Manufacturing Footprint Reduction (# Facilities) 45 Improv
Slide 42: SG&A Transformation Project Savings
SG&A Transformation Project Savings SG&A Cumulative Savings, $M Digitizing Internal Processes Using Process Data Mining Analytics to Drive Efficiencies ▪ $14M+ Leveraging Lower-Cost Global Shared Service Center ▪ Footprint 25-30 Improving Organizational Effectiveness, Eliminating ▪ Duplicative Activ
Slide 43: CBS Improving Cash Flow Capabilities
CBS Improving Cash Flow Capabilities 1 Segment Operating Free Cash Conversion Key Highlights 2020 Working Capital Tailwind, 2021 Headwind >100% ▪ Supply Chain Transformation Supporting Lower Working ▪ 100%+ 90-100% Capital 90% Improved Inventory Management ▪ 70% Digitizing Processes ▪ Improving Orde
Slide 44: A Better, Stronger ESAB
A Better, Stronger ESAB Sales Growth Bridge, $B MSD Sales Growth 1-2% ▪ $3+ 1-2% CAGR 2-3% CAGR Leverage CBS Growth Tools ▪ CAGR Launch Innovative New Product Introductions ▪ ~$2.2 Execute Attractive Acquisitions ▪ 2021E Market Innovation Accelerators M&A Long-Term Strategic Goal Segment-Level aEBIT
Slide 45: Talent & Summary
Talent & Summary 45 ESAB – A Fabrication Technology LeaderTalent & Summary 45 ESAB – A Fabrication Technology Leader
Slide 46: Best Team Wins: ESAB Leadership
Best Team Wins: ESAB Leadership Shyam Kambeyanda Chief Executive Officer Regional Leadership Functional Leadership Olivier Biebuyck Billal Hammoud Kevin Johnson Larry Coble President, EMEAR, President, Americas Chief Financial Officer Senior Vice President, Equipment and Digital Solutions and Fabric
Slide 47: The Best Team Wins
The Best Team Wins OUR GOAL OUR RESULTS Accountable Leaders Drive Results HIGH PERFORMING, DIVERSE, AND INCLUSIVE WORKPLACE OUR STRATEGY OUR CULTURE Our Associates Believe in ESAB – 84% Overall Engagement in Annual Survey Creating Better Together ATTRACT THE BEST TALENT Committed Team – MSD Voluntar
Slide 48: A Premier Global Fabrication Technology Company
A Premier Global Fabrication Technology Company Long-Term Strategic Goal Resilient Business with Strong Financial Performance ▪ $3B+ Organic Growth Driven By: ▪ Revenue Innovation Leadership ▪ Strong Regional Sales Teams ▪ Strong CBS Foundation, Significant Margin Expansion Opportunities ▪ Shaping t
Slide 49: ESAB brand logos
yy f, i WE VICTOR’ // THERMAL DYNAMICS’ // TWECO’ /| ARCAIR’ // EXATON™ // STOODY’ // ALCOTEC’ // AMI // GCE”
Slide 50: Q&A
Q&AQ&A
Slide 51: MedTechCo Introduction
MedTechCo Introduction March 11, 2021MedTechCo Introduction March 11, 2021
Slide 52: Presenters Today
Presenters Today Matt Trerotola Brady Shirley CEO President & COO MedTechCo MedTechCo Ben Berry Louis Vogt Steve Ingel Chief Financial President and EVP, Healthcare Officer, DJO GM, Surgical Solutions 52Presenters Today Matt Trerotola Brady Shirley CEO President & COO MedTechCo MedTechCo Ben Berry L
Slide 53: Specialty MedTech Innovator Built on a Strong Foundation
Specialty MedTech Innovator Built on a Strong Foundation… Long-term Strategic Goals Well Positioned Specialty Underpinned By Colfax MedTech Company Continuous Improvement Clear Strategy To Deliver HSD ▪ Foundation in Orthopedics Core Growth ▪ Proven innovation engine ▪ Operational improvement ▪ Attr
Slide 54: Recognized as a Global Leader across Orthopedics
Recognized as a Global Leader across Orthopedics 2021E REVENUE SPLIT (~$1.4B) WHAT DISTINGUISHES MEDTECHCO? ROW 7% • FAST GROWING RECONSTRUCTIVE PLATFORM Reconstructive (Recon) reshaping portfolio 25% Europe 20% 75% Prevention & • GLOBAL LEADER IN PREVENTION & United States Recovery (P&R) 73% RECOVE
Slide 55: Addressing Big, Attractive Ortho Market
Addressing Big, Attractive Ortho Market… 1 2 2019 INDUSTRY SALES ($B) TOP ORTHO PLAYERS ($B) MedTechCo competes in half of the $53B DePuy Synthes 8.8 Orthopedics market and “touches” it all 2020E-2025E 1 Industry CAGR Zimmer Biomet 7.3 ~48 5 ~4% Stryker 6.3 9 Knee 3-4% Smith & Nephew 3.6 Joint Recon
Slide 56: Fueled by Secular Growth and Technology Trends
…Fueled by Secular Growth and Technology Trends Aging, but active Transitioning to Innovation improving the Growing healthcare population, rising obesity outpatient care pathways quality of care consumerism ▪ Aging population ▪ Shift to ambulatory surgical centers ▪ Digital offerings, minimally inva
Slide 57: Fast-Growing Recon Business with Proven Playbook
Fast-Growing Recon Business with Proven Playbook 1 RECON SALES & MARKET POSITION U.S. RECONSTRUCTIVE CORE SALES GROWTH (CAGR) $20B market expected to grow 4-5% per year (Extremity segment expected to grow 7-8% per year) +17% Foot & Ankle Hip Reverse #1 Shoulder US in 2 ~$0.35B #3 Shoulder 2015 2016
Slide 58: Market Leader in Prevention & Recovery with Iconic Brands
Market Leader in Prevention & Recovery with Iconic Brands 1 P&R SALES & MARKET POSITION MARKET LEADERSHIP • Superior clinical outcomes $5B market expected to grow 3-4% per year • Leader in fast growing Sports Medicine segment Footcare Globally • Strong contract position across all GPOs #1 in Bracing
Slide 59: Unique Position Across Full Care Continuum
Unique Position Across Full Care Continuum PREVENTION REPAIR RECOVERY PERFORMANCE PREVENTION SURGICAL RECOVERY REHAB • Athletic braces • Pre-op braces • Shoulders • Post-op braces • Traction devices • Slings • Bone growth stim. • Muscle stimulation • Knees • Electrotherapy • Protective solutions • D
Slide 60: Company has Evolved, Growth is Accelerating
Company has Evolved, Growth is Accelerating 1 Pre-Colfax Colfax Future CORE REVENUE 2% 4% HSD GROWTH Consistently 2016-2018 CAGR 2019 MARGIN 19% 22% ~25%+ (aEBITDA) 2016 2019 Future Recon P&R Recon P&R Recon P&R REVENUE 2 MIX 16 25+ (% of revenue) 2020 Future 2016 P&R Recon Recon P&R Recon P&R 3 VIT
Slide 61: Momentum Powered by Colfax Improvement Pillars
Momentum Powered by Colfax Improvement Pillars 50% evolution of Executive Reduced backorders in P&R by Continuous Talent + Leadership Team and 83% overall 56% and improved held orders ✓✓ Improvement Organization associate engagement (+20% vs. by 29% (1Q20 v. 4Q18) prior year) Increased investment in
Slide 62: The Best Team Wins
The Best Team Wins CREATING BETTER TOGETHER ▪ Strong combination of MedTech leadership ATTRACT THE and Colfax talent BEST TALENT ▪ Group structure in place for strategic expansion ▪ Leadership Development Programs DEVELOP OUR TALENT ▪ Commercial / Operations Bootcamps ▪ 20% Improvement in 2020 Engag
Slide 63: Strong Leadership Team, Deep Med Tech Experience
Strong Leadership Team, Deep Med Tech Experience Brady Shirley Ben Berry President & COO Chief Financial MedTechCo Officer, DJO Stryker, IMDS Alcon Winning Team of Seasoned Professionals Steve Ingel Kevin Cordell Louis Vogt Andrew Fox-Smith EVP, Healthcare President and Group President, President, S
Slide 64: Clear Strategy to Deliver Long-term Growth
Clear Strategy to Deliver Long-term Growth Powerful combination of product and solution innovation, proactively addressing key market trends with acquisitions as accelerator 2 5 1 3 4 Accelerate Lead in Digital Rapid growth in Expand through Win in the ASC Innovation Healthcare Foot & Ankle M&A Deli
Slide 65: Accelerated Innovation Driving Core Growth
1 Accelerated Innovation Driving Core Growth… NEW PRODUCT INTRODUCTIONS Strategic expansion of surgical market coverage +300% 32 Expanding BAS leadership 8 into high growth categories 2017 2020 Leadership in transition to modalities in Recovery Sciences 1 P&R Vitality 11% Index (3Y) (2020) 7% in 201
Slide 66: …and Accelerating Key Strategies
1 …and Accelerating Key Strategies ® AltiVate Anatomic CS Edge™ EMPOWR Partial Knee™ Stemless Shoulder Implant NextGen Uni Knee ® ▪ Expands Altivate® Anatomic in fastest ▪ Empowr expansion into high growth growing shoulder segment segment ▪ Design optimized for younger patients ▪ Ideal procedure for
Slide 67: Positioned to Win in High Growth ASC Segment
2 Positioned to Win in High Growth ASC Segment… ASC: A VERY HIGH GROWTH SEGMENT DRIVERS OF ASC EXPANSION 1 TJA Procedures in ASC (000’s) ▪ Medicare approved reimbursement in 2018-19 ▪ 40% less expensive for Medicare in ASC 1,108 ▪ Faster recovery + lower infection/complication rates 333 1,057 ▪ Phys
Slide 68: …As the Leader Across the Episode of Care
2 …As the Leader Across the Episode of Care LEADING THE WAY ▪ Only company to support entire continuum of care ▪ Freshest, most differentiated technology portfolio ▪ Clear leadership in digital workflow solutions for ASC ASC360 Delivers with Products & Solutions Throughout the Patient Journey 682 …A
Slide 69: Leading in Digital Healthcare with Nextgen CAS Technologies
Leading in Digital Healthcare with Nextgen CAS (Computer Assisted 3 Surgery) Technologies Today 2021 Launches 2022 & Beyond 1 Leading Pre-Op Planning & PSI Best-in-class Pre-Op Planning & Expand range of innovative ▪▪▪ 1 solution for Shoulder PSI for Total Ankle Augmented Reality (A/R) Navigation pl
Slide 70: Leading in Digital Healthcare with MotionMD
® 3 Leading in Digital Healthcare with MotionMD SAAS WORKFLOW AUTOMATION SOFTWARE SOLUTION CLINIC LOCATION GROWTH PRODUCT REVENUE GROWTH (CAGR) (CAGR) +18% +74% 2,350 $65M 445 $40M 2017 2017 2020 2020 WINNING WITH WORKFLOW SOLUTIONS Secure. Paperless. Integrated ▪ 40% share in US clinics / used by o
Slide 71: Leading in Digital Healthcare and Moving Beyond the Brace with MotioniQ
Leading in Digital Healthcare and Moving Beyond the Brace with 3 ® MotioniQ ULTIMATE WEARABLE TECHNOLOGY TRANSITIONING TO SMART ▪ SmartBrace™ transforming “in-protocol” brace into wearable tech: ‒ 20%+ ASP expansion expected ▪ Opens pathway to large existing markets ‒ Remote patient monitoring ‒ Out
Slide 72: Defining the Future of Connected Medicine
3 Defining the Future of Connected Medicine X4 SMART BRACE SMART POST-OP BRACES Connected TKA Solution ACL Connected Solutions ▪ Expanding SmartBrace into Sports Medicine ▪ Outpatient/ASC driving postop TJA out of inpatient therapy ▪ Drives higher ASPs into traditional bracing protocols ▪ Large segm
Slide 73: Acquired Strong Position in High Growth Foot/Ankle Recon Market
4 Acquired Strong Position in High Growth Foot/Ankle Recon Market 1 US MARKET SIZE , $ (~$1.1B IN 2019), ~7% CAGR Product Coverage ® Star Trilliant Ankle Ankle Hindfoot Midfoot Forefoot (Including Bunion, Hallux Recon Fusion Rigidus, Hammertoe) F&A STRATEGY ® ® ▪ Capitalize on 90% of non-common surg
Slide 74: Recent Portfolio Investments Reshaping our Business
5 Recent Portfolio Investments Reshaping our Business Entering AR Surgical ASC High growth Projected Foot & Ankle Platform Solutions Modalities Portfolio Impact ▪ >$1B Market▪ Next Gen TJA ▪ Double digit ▪ HSD growth system procedural category ▪ HSD growth volume growth >$100M category▪ Footprint an
Slide 75: Expand Through M&A
5 Expand Through M&A Strengthen & Extend Current Business Within Orthopedic Market Logical MedTech Adjacencies Recon Technology Geographical application in expansion other markets High growth Sub- Foot & Ankle segments expansion Minimally Invasive High growth Surgery High Margin P&R Orthopedic Enabl
Slide 76: Realizing our Vision – Specialty Med Tech Innovator
Realizing our Vision – Specialty Med Tech Innovator LONG-TERM MEDTECHCO SALES STRATEGIC GOALS HSD P&R Core Growth Recon Extend & expand New high growth segments ~$1.7-2B Mid-60s Aggressively Gross Margin grow and Scale recon expand recon $1.4B >25% Improve and 2 Extend P&R aEBITDA Margin shape P&R l
Slide 77: Restored to MSD+ Core Growth, Acceleration Ahead
Restored to MSD+ Core Growth, Acceleration Ahead SALES ($B) PROGRESS 8% 5% 4% 2% Supply chain investment and CBS ▪ improvements restored P&R growth in Q1 Q2 Q3 Q4 2H 2019 $1.3-$1.4 Strong Reconstructive innovation and ▪ increasing P&R vitality $1.25 $1.20 $1.19 $1.16 $1.12 Recently completed 3 fast-
Slide 78: Clear Path to Margin Expansion
Clear Path to Margin Expansion… 1 MEDTECH aEBITDA MARGINS (%) MARGIN EXPANSION LEVERS Improvements 2016 19 • Recon mix ▪ Portfolio Shift to Recon • Structural reductions ▪ Product Mix in P&R 1 2019 22 ▪ CBS driving productivity Investments & Acquisitions offset 2020 18 COVID productivity ▪ Operating
Slide 79: …with Accelerated FCF Conversion
…with Accelerated FCF Conversion 1 SEGMENT OPERATING FREE CASH FLOW CONVERSION (%) HIGHLIGHTS CBS-driven process ▪ 90+% improvements drove strong Q4 ~80% 2020 performance 2021 includes working capital ▪ 55% investment to support COVID- recovery high growth rates ~25% Investing in Reconstructive grow
Slide 80: Summary
Summary Specialty MedTech innovator uniquely positioned for significant value creation ▪ Foundation in attractive Orthopedic market with favorable long term mega-trends ▪ Strong team leading evolving portfolio and accelerating growth ▪ Clear strategy with exciting pipeline of new products, digital e
Slide 81: Q&A
Q&AQ&A
Slide 82: Financial Update and Wrap-Up
Financial Update and Wrap-Up Chris Hix, EVP & CFOFinancial Update and Wrap-Up Chris Hix, EVP & CFO
Slide 83: Colfax Sustainable Model for Compounding Value Creation
Colfax Sustainable Model for Compounding Value Creation Talent Above-Market Sales Growth Innovation 1 2021E Margin Expansion CBS / Continuous Improvement Healthy Free Cash Flow Acquisitions / 1 Portfolio Shaping 2021E Each Business Now has Our Core Capabilities to Drive Superior Performance 83 1 202
Slide 84: 2021 Financial Outlook
2021 Financial Outlook As originally communicated February 18, 2021 MedTech ESAB▪ Expecting robust growth in 2021 in sales, earnings, Sales growth and cash flow Organic 14%-16% 9%-12% ▪ Strong operating leverage, net of investments: MT Reported 21%-24% 11%-14% 50%+, FT 30%+ ▪ $25-30M of restructurin
Slide 85: Strong Paths to Margin Expansion
Strong Paths to Margin Expansion ▪ Strong decremental performance in 1 Colfax aEBITDA Margins 2020: ~14 points less than natural operating leverage MedTechCo 17.1% 16.5 - 17.0% ▪ Return to our continuous improvement Strategic Goal of path in 2021 2 > 25% 15.2% ▪ Both businesses expected to have futu
Slide 86: Improved Cash Flow Capabilities
Improved Cash Flow Capabilities ▪ Stabilized MedTech segment in 2019 ▪ Significant process improvements across Colfax Free Cash Flow (FCF) Conversion Colfax in 2020 • MedTechCo 90%+ 1 ▪ Expecting > $250M of FCF in 2021; Conversion • Capital Allocation expect to deploy primarily for de- Focused on Gr
Slide 87: Next Steps
Next Steps Continue to execute our profitable growth strategy Determine form of separation, prepare SEC filings Create separate corporate capabilities Establish capital structures to match allocation priorities, strategies Take other steps to satisfy conditions for targeted Q1 ‘22 separation 87Next
Slide 88: Investor Day 2021 Wrap-Up
Investor Day 2021 Wrap-Up ✓ Taking the next logical step, given transformation of both businesses and opportunities ahead ✓ Strong momentum in both businesses ✓ Exciting visions for ESAB and MedTechCo ✓ Separation should enable both businesses to achieve visions and unlock value Focus on Superior Lo
Slide 89: Q&A
Q&AQ&A
Slide 90: Appendix
Appendix 90Appendix 90
Slide 91: Non-GAAP Reconciliation
Non-GAAP Reconciliation _____________________ Note: Dollars in millions. 91Non-GAAP Reconciliation _____________________ Note: Dollars in millions. 91
Slide 92: Non-GAAP Reconciliation
Non-GAAP Reconciliation __________ (1) Includes amortization of acquired intangibles and fair value charges on acquired inventory. _____________________ Note: Dollars in millions. Some periods may not foot due to rounding. 92Non-GAAP Reconciliation __________ (1) Includes amortization of acquired in
Slide 93: Non-GAAP Reconciliation
Non-GAAP Reconciliation __________ (1) The Net sales and Adjusted EBITDA figures for the two months ended February 22, 2019 are based on or derived from Management’s internal reports. The Colfax 2020 Form 10-K only includes prior year Medical Technology segment results subsequent to February 22, 201
Slide 94: Non-GAAP Reconciliation
Non-GAAP Reconciliation __________ (1) Medical Technology prior year Net sales and sales components are based on or derived from Management’s internal reports. On the Company’s 2020 and 2019 form 10-K reports, Medical Technology prior year Net sales include only sales subsequent to February 22, 2019
Slide 95: Non-GAAP Reconciliation
Non-GAAP Reconciliation __________ (1) Restructuring and other related charges includes $6.6 and $8.5 of expense classified as Cost of sales on the Company’s Consolidated Statements of Operations for the years ended December 31, 2020 and December 31, 2019, respectively. (2) Primarily related to cost
Slide 96: Non-GAAP Reconciliation
Non-GAAP Reconciliation __________ (1) 2019 Free cash flow includes cash outflows for strategic transaction costs and DJO incremental first year working capital investments of approximately $110 and $40, respectively. (2) Refer to the Adjusted net income non-GAAP reconciliation within this appendix
Slide 97: Non-GAAP Reconciliation
Non-GAAP Reconciliation __________ (1) Net income from continuing operations attributable to Colfax Corporation for the respective periods is calculated using Net income from continuing operations less the continuing operations component of the income attributable to noncontrolling interest, net of