Slide 1: Q1 2024 Earnings Presentation
Q1 2024 Earnings Presentation MAY 2, 2024 Q1 2024 EARNINGS PRESENTATION | COPYRIGHT © 2024 SPX TECHNOLOGIES
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements contained in this presentation that are not historical facts, including any statements as to future market conditions, results of operations, product introductions, and financial projections, are forward-looking statements within the meaning of Section 27A of
Slide 3: Introductory Comments
Introductory Comments Gene Lowe, President & Chief Executive Officer MAY 2, 2024 Q1 2024 EARNINGS PRESENTATION | COPYRIGHT © 2024 SPX TECHNOLOGIES 3|
Slide 4: Executive Summary
Executive Summary ▪ Strong execution in Q1 » Substantial earnings growth and significant increase in margins ▪ Momentum continues » Robust demand in key markets and acquisitions performing well ▪ Raising 2024 guidance » Adjusted EBITDA1 +30% y/y at midpoint; Adjusted EPS1 +23% y/y at midpoint 1 Adju
Slide 5: Q1 2024 Results Summary
Q1 2024 Results Summary ($ in millions) Q1 2024 ▪ Revenue growth of 16.4% Revenue » HVAC acquisitions Adjusted EBITDA/ Margin1 » D&M organic1 growth ▪ Adjusted EBITDA1 growth of 47% » 410 bps of margin1 expansion » Increase driven by both segments 1 Adjusted results are non-GAAP measures. Reconcilia
Slide 6: Value Creation Framework
Value Creation Framework Strong Foundation Business System Target Model Engineered Niches Leading Positions Excellence Growth 15%+ Adj. EBITDA1 Growth Tech-Enabled Digital Strategic M&A Moats Continuous Improvement New Product Development 20%+ Adj. EBITDA1 Margin Talent Commercial Sustainable Excell
Slide 7: Q1 2024 Financial Review
Q1 2024 Financial Review Mark A. Carano, Chief Financial Officer MAY 2, 2024 Q1 2024 EARNINGS PRESENTATION | COPYRIGHT © 2024 SPX TECHNOLOGIES 7|
Slide 8: Adjusted Earnings Per Share
Adjusted Earnings Per Share Q1 2023 Q1 2024 GAAP EPS from continuing operations $0.84 $1.05 Amortization $0.10 $0.24 Acquisition-related $0.03 $0.08 Non-service pension & other1 ($0.04) ($0.12) Adj EPS from continuing operations $0.93 $1.25 1 Q1 2024 includes the removal of certain favorable discret
Slide 9: Q1 2024 Results
Q1 2024 Results ($ in millions) Q1 Revenue: Q1 2024 ▪ 16.4% year-over-year increase: Revenue » 2.3% organic1 increase due to higher D&M sales Consolidated Segment Income / Margin1 » 14.0% acquisition impact (within HVAC) » 0.1% currency impact Q1 Consolidated Segment Income / Margin1: ▪ Both HVAC an
Slide 10: HVAC Q1 2024 Results
HVAC Q1 2024 Results ($ in millions) Q1 Revenue: Q1 2024 ▪ 20.2% year-over-year increase: Revenue » -1.9% organic1 decrease due to lower Heating sales, Segment Income / Margin partially offset by modest growth in Cooling sales » 22.2% acquisition impact (TAMCO, ASPEQ & Ingénia) » -0.1% currency impa
Slide 11: Detection & Measurement Q1 2024 Results
Detection & Measurement Q1 2024 Results ($ in millions) Q1 Revenue: Q1 2024 ▪ 9.9% year-over-year increase: Revenue » 9.6% organic1 increase due primarily to higher Segment Income / Margin CommTech sales and project timing » 0.3% currency impact Q1 Segment Income / Margin: ▪ Operating leverage from
Slide 12: Financial Position & Guidance
Financial Position & Guidance Mark A. Carano, Chief Financial Officer MAY 2, 2024 Q1 2024 EARNINGS PRESENTATION | COPYRIGHT © 2024 SPX TECHNOLOGIES 12 |
Slide 13: Financial Position Update
Financial Position Update ($ in millions) 2 Q4 2023 Q1 2024 Q4 2023 Q1 2024 2.61 Short-term debt $18 $317 2.11 Current maturities of long-term debt 17 21 1.61 Long-term debt 523 517 1.11 2.3x 2.3x Total Debt $558 $855 2.0x 2.0x Less: Cash on hand 3 (104) (106) 0.61 Net Debt $454 $749 0.11 Gross Leve
Slide 14: 2024 Guidance Update
2024 Guidance1 Update Detection & Total SPX HVAC Measurement Revenue $1.965-$2.025B $1,360-$1,400m $605-$625m Prior $1.93-$2.00B $1,325-$1,375m $605-$625m Segment Income Margin1 21.6%-22.6% 22.25%-23.25% 20.0%-21.0% Prior 21.0%-22.0% 21.25%-22.25% 20.0%-21.0% Adj. EBITDA1 $390-$420m Prior $375-$405m
Slide 15: End Market Review & Closing Comments
End Market Review & Closing Comments Gene Lowe, President & Chief Executive Officer MAY 2, 2024 Q1 2024 EARNINGS PRESENTATION | COPYRIGHT © 2024 SPX TECHNOLOGIES 15 |
Slide 16: Market Commentary
Market Commentary Cooling Heating Project Oriented Run-Rate ▪ Strong demand trends ▪ Decarbonization driving ▪ Overall project demand ▪ Flat global demand with continue commercial & industrial healthy regional variation ▪ Stable supply chain demand ▪ Infrastructure spending ▪ Hydronics stable on hor
Slide 17: Executive Summary
Executive Summary ▪ Strong Q1 results ▪ Robust demand and operating momentum ▪ Updated guidance implies 30% Adjusted EBITDA1 growth at midpoint ▪ Attractive acquisition pipeline 1 Reconciliations of non-GAAP guidance measures to US GAAP financial measures are not practicable and accordingly are not
Slide 18: Appendix
Appendix MAY 2, 2024 Q1 2024 EARNINGS PRESENTATION | COPYRIGHT © 2024 SPX TECHNOLOGIES 19 |
Slide 19: Modeling Considerations – Full-Year 2024
Modeling Considerations – Full-Year 2024 Metric Considerations Corporate expense $50.0-52.0m Long-term incentive comp $14.5-15.5m Restructuring costs ~$1m Interest cost $43.0-47.0m Other income/(expense), and Non-service pension benefit/(expense) ~$3m Tax rate 24.0%-26.0% Capex ~$40m Cash cost of pe
Slide 20: GAAP Reconciliation Results by Quarter
GAAP Reconciliation Results by Quarter ($ in millions) 2023 2024 Q1 Q2 Q3 Q4 FY Q1 Consolidated segment income1 $ 74.4 $ 84.4 $ 91.6 $ 102.8 $ 353.2 $ 99.8 Corporate expense (14.6) (16.6) (13.0) (14.2) (58.4) (13.9) Acquisition-related and other costs (0.6) (1.5) (2.9) (0.8) (5.8) (2.6) Long-term in
Slide 21: Segment Results
Segment Results ($ in millions) 2023 2024 HVAC Q1 Q2 Q3 Q4 FY Q1 Revenue $251.6 $269.0 $289.2 $312.5 $1,122.3 $302.4 Segment income $47.7 $55.2 $58.3 $73.2 $234.4 $68.4 19% 21% 20% 23% 21% 23% Detection and 2023 2024 Measurement Q1 Q2 Q3 Q4 FY Q1 Revenue $148.2 $154.3 $159.5 $156.9 $618.9 $162.8 Seg
Slide 22: Q1 2024 Revenue by Major product lines
Q1 2024 Revenue by Major product lines ($ in millions) MAY 2, 2024 Q1 2024 EARNINGS PRESENTATION | COPYRIGHT © 2024 SPX TECHNOLOGIES 23 |
Slide 23: Q1 2023 Revenue by Major product lines
Q1 2023 Revenue by Major product lines ($ in millions) MAY 2, 2024 Q1 2024 EARNINGS PRESENTATION | COPYRIGHT © 2024 SPX TECHNOLOGIES 24 |
Slide 24: Q1 2024 U.S. GAAP to Adjusted EPS Reconciliation
Q1 2024 U.S. GAAP to Adjusted EPS Reconciliation ($ in millions, except per share) GAAP Adjustments Adjusted Segment income $ 99.8 $ — $ 99.8 Corporate expense (1) (13.9) 2.4 (11.5) Acquisition-related costs (2) (2.6) 2.6 — Long-term incentive compensation expense (3.3) — (3.3) Amortization of intan
Slide 25: Q1 2023 U.S. GAAP to Adjusted EPS Reconciliation
Q1 2023 U.S. GAAP to Adjusted EPS Reconciliation ($ in millions, except per share) GAAP Adjustments Adjusted Segment income $ 74.4 $ — $ 74.4 Corporate expense (1) (14.6) 1.6 (13.0) Acquisition-related costs (2) (0.6) 0.6 — Long-term incentive compensation expense (3.1) — (3.1) Amortization of intan
Slide 26: U.S. GAAP to Adjusted Operating Income Reconciliation
U.S. GAAP to Adjusted Operating Income Reconciliation ($ in millions) Three months ended March 30, 2024 April 1, 2023 Operating income $ 64.6 $ 49.8 Include - TSA Income (1) — 0.1 Exclude: Acquisition-related and other costs (2) (5.0) (2.1) Amortization of acquired intangible assets (14.8) (6.3) Adj
Slide 27: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation ($ in millions) Three months ended March 30, 2024 April 1, 2023 Net income $ 49.0 $ 42.8 Exclude: Income tax provision (1.9) (11.3) Interest expense, net (9.5) (1.9) Amortization expense (1) (14.8) (6.3) Depreciation expense (6.2) (4.4) Gain (loss) from discontinued op
Slide 28: Q1 2024 Non-GAAP Reconciliation – Organic Revenue
Q1 2024 Non-GAAP Reconciliation – Organic Revenue Three months ended March 30, 2024 Detection & HVAC Measurement Consolidated Net Revenue Growth 20.2 % 9.9 % 16.4 % Exclude: Foreign Currency (0.1) % 0.3 % 0.1 % Exclude: Acquisitions 22.2 % - % 14.0 % Organic Revenue Growth (Decline) (1.9) % 9.6 % 2.
Slide 29: Q1 2024 Adjusted Free Cash Flow Reconciliation
Q1 2024 Adjusted Free Cash Flow Reconciliation ($ in millions) Q1 2024 Operating cash flow from continuing operations $ 10.7 Capital expenditures (9.9) Free cash flow from continuing operations 0.8 1 Adjustments 12.4 Adjusted free cash flow from continuing operations $ 13.2 1Adjustments represent th