Trane Technologies Plc · NYSE:TT
Trane Technologies — Ingersoll-Rand — Q1 2003 Earnings Presentation
27 slides from Trane Technologies's earnings presentation, Apr 17, 2003
Slide 1: First Quarter 2003 Results
aim) First Quarter 2003 Results Ingersoll Rand April 17, 2003 Proven source. Proven solutions.
Slide 2: Safe Harbor
Safe Harbor Forward looking statements that involve risks. Please refer to March 5, 2003 Form 10K for details on factors that influence results.
Slide 3: First Quarter EPS Results
GR) First Quarter EPS = Results $.90 Discontinued |Rexw $.48 $.06 Continuing oe 2003 2002 EPS from continuing operations consistent with guidance 3
Slide 4: First Quarter 2003 Results
) First Quarter 2003 Results wy Results Activity levels remain sluggish Pockets of strength due to strategy execution Strong results in several businesses _ Dresser-Rand _ Thermo King _ Security and Safety Performance for month of March consistent with expectations No signs of sustained recovery in
Slide 5: First Quarter Orders
(GR) First Quarter Orders 4Q2003 Results » Total orders up by 1.4% = Climate Control flat _ Thermo King: single-digit increase _ Hussmann: single-digit decrease » Air and Productivity up 10% _ Gains at Air Solutions and Fluid Products » Dresser-Rand down double digits, reflecting disruptions in the
Slide 6: Sale of Engineered Solutions to Timken
(GR) Sale of Engineered Solutions to Timken Pane Results Sale effective February 16 Proceeds _ $700 Million cash _ 9.4 Million Timken shares ($140 Million) — 80% of CDO benefit Cash proceeds used to pay down debt _ Reduced annual interest by $40 Million _ Debt/Capital ratio reduced to 41% Reinvest 2
Slide 7: IR International — Global Trading Company
(GR) IRInternational — Global Trading Company —_jq203 Results IRI responsible for export processes and technology support » “One face” to customer and enhanced customer information base » Dealer ordering system will be infrastructure for dealerships in the future » Located in Dublin, Ireland, to hel
Slide 8: Recurring Revenue as a % of Total Revenue
Recurring Revenue as a\% of, Total Revenue 26% Q, 20% 24% 2001 2002 2003 1Q 1 1 Continuing growth of recurring revenue (GR) 1Q 2003 Results
Slide 9: Recurring Revenues — Air Solutions
(GR) Recurring Revenues — Air Solutions Pane Results # of AirCare Contracts usd 9000 — 8010 6000 4 3447, 3000 4 es 1039 Bo 0 Pie 2007 2002 2003 2001 at Q2 Q3 a at Q2 a3 a4 10 50% of Air Solutions revenues came from aftermarket | 9
Slide 10: National Service Contracts
(GR) National Service Contracts 402003 Results Recurring Revenue - Hussmann 5,000+ 3,900 3,300 800 2001 2002 2003 2003 Year end Year end 1Q Target Recurring revenue grew 6% in the first quarter and comprised 37% of sales 10
Slide 11: Lean Branch Initiative
(GR) Lean Branch Initiative 4Q2003 Results » Capture and establish best practice branch procedures » Improve service technician productivity » Automate transactions » Align branches and aftermarket parts structure to reduce part numbers and costs = Reduce “back office” costs Target to reduce annual
Slide 12: Continue to develop product line and market focus
= Continue to develop product line and market focus « Received first commitments from target segments for 250 kW unit Landfill _ Petrochemical _ Wastewater treatment « First grid isolated multi-unit application in the commercial and industrial market = 250 kW commercial units targeted for July 2003
Slide 13: Air Solution Innovation
(GR) Air Solution Innovation 40.2003 Results » Nirvana — 250 units sold _ Nirvana II (125-200 hp) introduction in second quarter » Pegasus — 20-30 hp version sold well in first quarter _ Pegasus II 40-50 hp version available in second quarter New products fuel revenue growth 13
Slide 14: Bobcat Innovation - Toolcat
Ry Bobcat Innovation - Toolcat Uy Results
Slide 15: First Quarter 2003 Summary
) First Quarter 2003 oy Results Challenging quarter — sluggish end markets Continue to improve operating efficiencies Introduce innovative solutions Strategic investments to continue growth We are executing our strategy 15
Slide 16: First Quarter 2003 Results
First Quarter 2003 Results $ millions, except EPS Revenues Operating Income Margin Interest Expense Other Expense Eamings before taxes, continuing operations Taxes, continuing operations Earmings after taxes, continuing operations Discontinued operations, net of tax Net Earnings EPS Diluted Continui
Slide 17: Revenues — Continuing Operations
(GR) Revenues — Continuing Operations Pane Results 2003 Q1 Results Year-over-year change 23% 9% % a 9% North Latin America Europe cent America Expansion across all major geographic regions 17
Slide 18: Climate Control
Climate Control $ Millions $558 $514 perating Margins 2003 2002 (GR) 1Q 2003 Results = Hussmann _ Revenues declined 2% _ Continuing restricted capital spending by U.S. supermarket chains » Thermo King _ Revenues up 20% (13% excluding currency) _ Key drivers: + North American trailer + Europe truck/t
Slide 19: Air and Productivity Solutions
(GR) Air and Productivity Solutions Pane Results $ Millions $320 $310. » Air Solutions _ Revenues up 6% ~ 13% growth in Air Care program = Productivity Solutions _ Flat revenues 2003 2002 19
Slide 20: Dresser-Rand 1Q 2003
(GR) Dresser-Rand 1Q 2003 Results $ Millions $278 $212 » Revenues up 31% a 26% excluding buy-outs = Backlog = $762 Mil. $534 excluding buy-outs 20
Slide 21: Infrastructure
Infrastructure $ Millions $661 $635 Operating 4, 10.4 % . i Margins 2003 2002 » Revenues up 4% _ Revenue gains in all businesses (GR) 1Q 2003 Results = Continued softness in U.S. road-repair markets _ Unfavorable pricing in North America 21
Slide 22: Security and Safety
(GR) Security and Safety 402003 Results $ Millions » Revenues up 11% _ Up 7% excluding the impact of ETC acquisition = Continuing to grow in Security Solutions business 2003 2002 22
Slide 23: Manage for Cash: Working Capital as a % of Revenues
Manage for Cash: (GR) Working Capital as a% of Revenues oe Results % Working Capital = g AJR + Inventory - A/P = 15 é % = ee sau ee 10.8% ————_ . x (10 3 6.1% S 2002 o 5 2 2003 = £0 Qi Q2 Q3 a4 Improved working capital management 23 *Quarterly revenues annualized. Excludes Morgan discounting program
Slide 24: Other Balance Sheet Indicators
) Other Balance Sheet Indicators ea Results Q71 2003 Q1/ 2002 Capital Expenditures $25 M $26 M Debt to Capital 41.3% 47.5% Total Debt $2.6 B $3.7 B 24
Slide 25: 2003 Earnings Outlook — Second Quarter
(GR) 2003 Earnings Outlook—Second Quarter — jq203 Results Second Quarter DEPS Continuing Operations $.74-$.79 Discontinued Operations (.04) Total $.70 - $.75 Second quarter DEPS $0.70 - $0.75 25
Slide 26: 2003 Earnings Outlook — Full Year
(GR) 2003 Earnings Outlook — Full Year, Pane Results Full Year DEPS Continuing Operations $3.00 - $3.20 Discontinued Operations 10 Sub total $3.10 — $3.30 Gain on sale of Engineered Solutions soil Full year $3.41 - $3.61 No change to forecast 26
Slide 27: Ingersoll Rand — Proven solutions
rovensolutions, —__ — IngersollRand