Slide 1: Earnings Conference Call Q2 2022
Earnings Conference Call Q2 2022
Slide 2: Forward-Looking Statements
Brunswick Corporation - Earnings Release Forward-Looking Statements Certain statements in this presentation are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations, estimates, and projections abou
Slide 3: Use of Non-GAAP Financial Information and Constant Currency Reporting
Brunswick Corporation – Earnings Release Use of Non-GAAP Financial Information and Constant Currency Reporting In this presentation, Brunswick uses certain non-GAAP financial measures, which are numerical measures of a registrant’s historical or future financial performance, financial position or ca
Slide 4: Business Overview
BUSINESS OVERVIEW Dave Foulkes - CEO |4 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 5: Outstanding Performance Across the Company
Brunswick Corporation – Earnings Release Outstanding Performance Across the Company Record Q2 results: Broad based top-line Field inventory remains Narrowed FY 2022 growth: low with elevated guidance: • Net sales of $1.84B (up • Record propulsion performance backlogs: • Net sales of $6.9B - $7.1B 18
Slide 6: We Continue to Successfully Navigate External Factors
Brunswick Corporation – Earnings Release We Continue to Successfully Navigate External Factors ✓ Supply chain remains disruptive, although some moderation occurring ✓ Continued strong ECONOMIC CONCERNS CONSUM ER BEHAVIOR consumer boating participation levels SUPPLY CHAIN DEALER SURVEYS Supply-side c
Slide 7: Each Segment Contributed to Q2 2022 Outperformance
Brunswick Corporation – Earnings Release Each Segment Contributed to Q2 2022 Outperformance PROPULSION PAR T S & B O AT S & B U S I N E S S ACCESSORIES A C C E L E R AT I O N • Share gains continue globally • Sales increases driven by Navico, • Double digit adjusted operating 1 through Q2 2022 – U.S
Slide 8: Mix By Region and Q2 Revenue Growth Rates
Brunswick Corporation – Earnings Release Mix By Region1 and Q2 Revenue Growth Rates ✓ All regions experienced substantial sales Canada Europe growth, with the Growth +2% Growth +11% Mix: 7% Mix: 15% exception of Asia Pacific Asia- Pacific ✓ International sales up U.S. Growth -7% 7 percent on a Growt
Slide 9: U.S. Main Powerboat Industry – Percentage Change in Retail Units
Brunswick Corporation – Earnings Release U.S. Main Powerboat Industry – Percentage Change in Retail Units ✓ 1H 2022 main MAIN POWERBOAT OUTBOARD ENGINES (NMMA) 1H 2022 VS. powerboat industry SEGMENT 2022 VS. retail down 16% vs. 1H 2021, only slightly 10% below 1H 2019, with trends improving -2% -1%
Slide 10: Financial Overview
FINANCIAL OVERVIEW Ryan Gwillim – CFO | 10 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 11: Overview of Second Quarter 2022 Adjusted Results
Brunswick Corporation – Earnings Release Overview of Second Quarter 2022 Adjusted Results1 NET SALES ($m) OPERATING EARNINGS1 ($m) $1,836 $266 $300 ✓ Q2 2022 revenue, $1,555 +18% +13% operating earnings $1,164 $180 and EPS were highest in Company history ✓ Sales, earnings and 2019 2021 2022 2019 202
Slide 12: Overview of YTD 2022 Adjusted Results
Brunswick Corporation – Earnings Release Overview of YTD 2022 Adjusted Results1 NET SALES ($m) OPERATING EARNINGS1 ($m) $3,531 $568 $509 $2,988 +18% +11% $2,214 $305 ✓ First Half 2022 performance higher than any previous full-year 2019 2021 2022 2019 2021 2022 except 2021 OPERATING MARGIN1 % DILUTED
Slide 13: Propulsion Segment – Q2 '22 Performance
Brunswick Corporation – Earnings Release Propulsion Segment – Q2 ’22 Performance % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Outboard Engines $566 14% 60% Sterndrive Engines $62 5% 24% Controls, Rigging and Propellers $106 11% 84% Total $734 13% 59% OPERATING MARGIN OPERATING EARNINGS • Operat
Slide 14: Parts & Accessories Segment – Q2 '22 Performance
Brunswick Corporation – Earnings Release Parts & Accessories Segment – Q2 ’22 Performance1 % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Engine Parts and Accessories $147 (6)% 28% Distribution $232 (9)% 33% Advanced Systems Group $159 15% 32% Navico $114 N/A N/A Total $652 19% 59% OPERATING MARG
Slide 15: Boat Segment – Q2 '22 Performance
Brunswick Corporation – Earnings Release Boat Segment – Q2 ’22 Performance1 % CHANGE VS SALES PRODUCT CATEGORY 2021 2019 ($M) Aluminum Freshwater $237 25% 48% Recreational Fiberglass $187 22% 57% Saltwater Fishing $110 19% 34% Business Acceleration $36 134% N/A Total $5682 27% 55% OPERATING MARGIN O
Slide 16: Pipeline Metrics
Brunswick Corporation – Earnings Release Pipeline Metrics UNITS IN PIPELINE – END OF Q2 2022 Global Pipelines U.S. Pipelines 23K -55% -63% 15K 10K 7K 5K 3K 2019 2021 2022 2019 2021 2022 WOH 35 9 16 WOH 32 6 12 1H 2022 pipeline levels 55% below 2019 levels; even lower inventory in U.S. | 16 ©2022 Bru
Slide 17: Narrowing Full Year 2022 Guidance
Brunswick Corporation – Earnings Release Narrowing Full Year 2022 Guidance1 Changes to FY 2022 EPS Assumptions: Changes to FY '22 EPS Guidance $10.40 ✓ 2H FX impact $10.30 $10.30 ✓ Share Repurchases $10.30 ✓ Q2 strong business $10.20 performance $10.10 Narrowed FY 2022 Guidance: $0.15 ✓ Revenue $10.
Slide 18: Updated 2022 Full Year Assumptions
Brunswick Corporation – Earnings Release Updated 2022 Full Year Assumptions 1 Share ~$400 MILLION Foreign Currency ~$35 – $40 MILLION Repurchases Prev: ~$300M Earnings Headwind Prev: ~$10 - $15M ~75.0 – 75.5 Average Diluted MILLION Tariff Earnings ~$50 MILLION Shares Outstanding Prev: ~76.0 - 76.5M
Slide 19: Wrap-Up
WRAP-UP Dave Foulkes – CEO | 19 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 20: In the News – Q2 2022
Brunswick Corporation – Earnings Release Brunswick in the News – Q2 2022 Sea Ray 260 Women Portugal Photovoltaic Solar Mercury Launches New 25-30hp Refurbishment & Sales Center Design Team Project Outboards Opening Freedom Continues Rapid Growth • 360+ global locations • 50,000+ memberships • ~5,000
Slide 21: New Products and Technology
Brunswick Corporation – Earnings Release New Products and Technology SLX 260 280 DAUNTLESS 25 & 30HP AVATOR POWER MANAGEMENT | 21 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 22: Thank You + Q&As
THANK YOU + Q&As | 22 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 23: Appendix
Appendix | 23
Slide 24: Updated Assumptions and Guidance for 2022
Brunswick Corporation – Earnings Release Updated Assumptions and Guidance for 2022* 1 2 3 4 5 Revenue Operating Operating EPS FCF in between margin growth expenses as between EXCESS OF $6.9B - between 20 AND a % of sales $10.00 - $350 MILLION $7.1B 40 BPS to $10.30 INCREASE 20% 40 TO 60 23% BPS Prev
Slide 25: 2022 Updated Outlook – Segment Guidance
Brunswick Corporation – Earnings Release 2022 Updated Outlook – Segment Guidance Parts & Propulsion Accessories Boat NET SALES UP MID-TO-HIGH TEENS UP LOW-TO-MID UP LOW-TWENTIES GROWTH PERCENT TWENTIES PERCENT PERCENT Prev: +Mid- Prev: +High- Prev: +Mid- Teens % Twenties % Teens % O P E R AT I N G U
Slide 26: 2022 Updated Outlook – P&L and Cash Flow Assumptions
Brunswick Corporation – Earnings Release 2022 Updated Outlook – P&L and Cash Flow Assumptions Working ~$170 – $200 Effective Book APPROXIMATELY Capital Usage MILLION Tax Rate 22% No Change No Change Depreciation & ~$160 Effective Cash HIGH-TEENS Amortization1 MILLION Tax Rate PERCENT Prev: ~160-170
Slide 27: 2022 Updated Outlook – Capital Strategy and Other Assumptions
Brunswick Corporation – Earnings Release 2022 Updated Outlook – Capital Strategy and Other Assumptions Capital ~$375 – $425 MILLION Share ~$400 MILLION Expenditures No Change Repurchases Prev: ~$300M Debt $57 MILLION Quarterly $0.365 PER SHARE Retirement No Change Dividends No Change Net Interest ~$
Slide 28: GAAP to Non-GAAP Reconciliations – Q2
Brunswick Corporation – Earnings Release GAAP to Non-GAAP Reconciliations – Q2 Operating Earnings Diluted Earnings per Share (in millions, except per share data) Q2 2022 Q2 2021 Q2 2022 Q2 2021 GAAP $279.0 $250.2 $2.61 $2.29 Restructuring, exit and impairment charges — 0.2 — — Purchase accounting am
Slide 29: GAAP to Non-GAAP Reconciliations – YTD
Brunswick Corporation – Earnings Release GAAP to Non-GAAP Reconciliations – YTD Operating Earnings Diluted Earnings per Share (in millions, except per share data) YTD 2022 YTD 2021 YTD 2022 YTD 2021 GAAP $518.5 $482.1 $4.86 $4.44 Restructuring, exit and impairment charges — 0.7 — — Purchase accounti
Slide 30: Q2 Net Sales Increase by Segment and Region
Brunswick Corporation – Earnings Release Q2 Net Sales increased by $280.8 million, or 18 percent Segments Q2 2022 Q2 2021 % Change Propulsion $734.2 $649.5 13% Parts & Accessories 651.5 548.9 19% Boat 568.4 449.1 27% Segment Eliminations (118.5) (92.7) Total $1,835.6 $1,554.8 18% Q2 2022 Constant Cu
Slide 31: YTD Net Sales Increase by Segment and Region
Brunswick Corporation – Earnings Release YTD Net Sales increased by $543.3 million, or 18 percent Segments YTD 2022 YTD 2021 % Change Propulsion $1,440.1 $1,307.3 10% Parts & Accessories 1,269.3 1,008.5 26% Boat 1,061.2 868.6 22% Segment Eliminations (239.3) (196.4) Total $3,531.3 $2,988.0 18% YTD 2
Slide 32: Q2 '22 Effective Tax Rate at ~22%
Brunswick Corporation – Earnings Release Q2 ’22 Effective Tax Rate at ~22% Q2 2022 Q2 2021 Effective Tax Rate - GAAP 21.9% 23.5% 1 Effective Tax Rate - As Adjusted 22.2% 21.0% YTD 2022 YTD 2021 Effective Tax Rate - GAAP 21.5% 22.7% 1 Effective Tax Rate - As Adjusted 21.7% 21.8% 1Tax provision, as ad
Slide 33: Free Cash Flow - YTD
Brunswick Corporation – Earnings Release Free Cash Flow - YTD (in millions) YTD 2022 YTD 2021 Net cash provided by operating activities from $149.4 $350.5 continuing operations Net cash (used for) provided by: Capital expenditures (196.5) (110.3) Proceeds from sale of property, plant, equipment 3.0