Regal Rexnord Corporation · NYSE:RRX
Regal Rexnord — Q3 2022 Earnings Presentation
28 slides from Regal Rexnord's earnings presentation, Nov 1, 2022
Slide 1: Third Quarter 2022 Earnings
Creating a better tomorrow™… Third Quarter 2022 Earnings November 1, 2022 Louis Pinkham, Chief Executive Officer Rob Rehard, Vice President, Chief Financial Officer
Slide 2: 3Q 2022 Forward Looking Statements
3Q 2022 FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which reflect Regal Rexnord’s current estimates, expectations and projections about Regal Rexnord’s future results, performa
Slide 3: 3Q 2022 Non-GAAP Financial Measures
3Q 2022 NON-GAAP FINANCIAL MEASURES We prepare financial statements in accordance with accounting principles generally accepted in the United For forward-looking non-GAAP measures (as used in this presentation, net leverage), we are unable to States of America (“GAAP”). We also periodically disclose
Slide 4: Opening Comments & Overview
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 3Q 2022 Results, 2022 Outlook ROB REHARD, CFO Altra Acquisition LOUIS PINKHAM, CEO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 5: 3Q 2022 Opening Comments
3Q 2022 OPENING COMMENTS • Strong Organic Sales Growth, Positive Price/Cost, ($ in millions, except per share EBITDA Margin Expansion data) 3Q 2021 3Q 2022 • Free Cash Flow Conversion (1) Improving, 3Q At 93% Adjusted Net Sales* $892.7 $1,325.3 • Order Moderation As Expected o Up Double Digits Vs. 3
Slide 6: Industrial Powertrain Momentum
3Q 2022 INDUSTRIAL POWERTRAIN MOMENTUM Powertrain Solution Win Evidences Differentiated Value-Added In An Attractive End Market Customer Problem A grain processing customer involved in the production of ethanol, renewable diesel, and biodiesels was looking for an integrated solution that delivered h
Slide 7: 3Q 2022 Results, 2022 Outlook
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 3Q 2022 Results, 2022 Outlook ROB REHARD, CFO Altra Acquisition LOUIS PINKHAM, CEO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 8: Motion Control Solutions
3Q 2022 MOTION CONTROL SOLUTIONS Sales Adjusted Net Sales* Adjusted EBITDA* • Organic Sales* Up 3.6% ($ Millions) ($ Millions) • Key Drivers • General Industrial • Aerospace $39.0 • Alt. Energy (-) Adjusted EBITDA Margin* • 27.2% of Adj. Net Sales $21.3 $189.8 * Non-GAAP Financial Measurement, See A
Slide 9: Climate Solutions
3Q 2022 CLIMATE SOLUTIONS Sales Adjusted Net Sales* Adjusted EBITDA* ($ Millions) • Organic Sales* Up 4.9% ($ Millions) • Key Drivers • N.A. Resi HVAC $166.9 • General Industrial $268.4 166.9 $268.4 • Europe (-) Adjusted EBITDA Margin* • 16.4% of Adj. Net Sales * Non-GAAP Financial Measurement, See
Slide 10: Commercial Systems
3Q 2022 COMMERCIAL SYSTEMS Sales Adjusted Net Sales* Adjusted EBITDA* ($ Millions) ($ Millions) • Organic Sales* Up 11.5% • Key Drivers • C-HVAC • N.A. General Industrial • Pool Pump (-) Adjusted EBITDA Margin* • 16.7% of Adj. Net Sales * Non-GAAP Financial Measurement, See Appendix for Reconciliati
Slide 11: Industrial Systems
3Q 2022 INDUSTRIAL SYSTEMS Sales Adjusted Net Sales* Adjusted EBITDA* • Organic Sales* Up 14.7% ($ Millions) ($ Millions) • Key Drivers • U.S. General Industrial • China (-) Adjusted EBITDA Margin* • 13.2% of Adj. Net Sales * Non-GAAP Financial Measurement, See Appendix for Reconciliation. Operating
Slide 12: Key Financial Metrics & Other Updates
3Q 2022 KEY FINANCIAL METRICS & OTHER UPDATES Capital Expenditures Balance Sheet at September 30, 2022 • $22.0 Million in 3Q 2022 • Total Debt of $2,195.9 Million • Net Debt of $1,472.3 Million Effective Tax Rate (ETR) • Net Debt/Adj. Bank EBITDA* of 1.4 • 21.6% Adj. ETR* in 3Q 2022 Free Cash Flow*
Slide 13: Updating 2022 Outlook
3Q 2022 UPDATING 2022 OUTLOOK • Revising Adjusted Diluted Earnings per Share* Guidance to a Range of $10.35 to $10.75 from $10.20 to $10.80. o Mid-Point Rises $0.05 to $10.55 • Continue to Expect Organic Revenue Growth at a High Single Digit Rate. Modeling Items • Stock-Based Compensation of $23M •
Slide 14: Altra Acquisition
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 3Q 2022 Results, 2022 Outlook ROB REHARD, CFO Altra Acquisition LOUIS PINKHAM, CEO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 15: Altra Acquisition
3Q 2022 ALTRA ACQUISITION ~$1.9B* >35%* ~19.5%* ~$1B* • Clear Strategic Logic: Transforms RRX’s Net Sales Gross Margin Adj. EBITDA Margin Backlog Automation Capability & Enhances Powertrain Offering Power Transmission Technologies Automation & Specialty • Strong Financial Returns Expected: Accretive
Slide 16: Questions & Answers
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 3Q 2022 Results, 2022 Outlook ROB REHARD, CFO Altra Acquisition LOUIS PINKHAM, CEO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 17: Closing Remarks
4Q 2021 Creating a better tomorrow™… Opening Comments & Overview LOUIS PINKHAM, CEO 3Q 2022 Results, 2022 Outlook ROB REHARD, CFO Altra Acquisition LOUIS PINKHAM, CEO Questions & Answers Closing Remarks LOUIS PINKHAM, CEO
Slide 18: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 18 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 19: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 19 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 20: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 20 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 21: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 21 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 22: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 22 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 23: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 23 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 24: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 24 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 25: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 25 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 26: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 26 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 27: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 27 ©2022 Regal Rexnord Corporation, Proprietary and Confidential
Slide 28: 3Q 2022 Appendix
3Q 2022 APPENDIX Creating a better tomorrow™… 28 ©2022 Regal Rexnord Corporation, Proprietary and Confidential