Slide 1: Chart Industries, Inc. Second Quarter 2023 Earnings Call
Chart Industries, Inc. Second Quarter 2023 Earnings Call JULY 28, 2023 Exhibit 99.2
Slide 2: Forward Looking Statements (1/2)
GTLS: GAS TO LIQUID SYSTEMS® Forward Looking Statements (1/2) CERTAIN STATEMENTS MADE IN THIS INVESTOR PRESENTATION ARE FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. FORWARD-LOOKING STATEMENTS INCLUDE STATEMENTS CONCERNING CHART’S BUSINESS PLA
Slide 3: Forward Looking Statements (2/2)
GTLS: GAS TO LIQUID SYSTEMS® Forward Looking Statements (2/2) 3 THIS PRESENTATION CONTAINS NON-GAAP FINANCIAL INFORMATION, WITH RESPECT TO THE COMPANY’S 2023 AND 2024 FULL YEAR EARNINGS OUTLOOK, THE COMPANY IS NOT ABLE TO PROVIDE A RECONCILIATION OF THE ADJUSTED EBITDA, ADJUSTED GROSS MARGIN, ADJUST
Slide 4: All Figures Presented are Continuing Operations Unless otherwise noted
GTLS: GAS TO LIQUID SYSTEMS® All Figures Presented are Continuing Operations Unless otherwise noted 4 • Our second quarter 2023 results from continuing operations reflect our first full quarter of ownership of Howden and exclude the Roots™ financial results for our entire ownership period (Roots™ is
Slide 5: Today's Key Takeaways
GTLS: GAS TO LIQUID SYSTEMS® Today’s Key Takeaways 5© 2023 Chart Industries, Inc. Confidential and Proprietary • Market demand continues to build driven by aftermarket, service, and repair, LNG, hydrogen, carbon capture and storage, mining (i.e., electrification metals), and nuclear/ helium • Q2 202
Slide 6: Executed to Date On-Schedule and to Targets
GTLS: GAS TO LIQUID SYSTEMS® Executed to Date On-Schedule and to Targets 6 # Action What we said in November 2022 As of July 27, 2023 Status 1 Financing Did not expect to close into the bridge and would seek to limit amount of KPS Capital Partners (KPS) preferred stock Completed financing in Decembe
Slide 7: Continue to Execute On-Schedule and to Targets
GTLS: GAS TO LIQUID SYSTEMS® Continue to Execute On-Schedule and to Targets 7 # Action What we said in November 2022 As of July 27, 2023 Status 1 Cost synergies, year 1 $175 million $175 million Additional opportunities for upside and buffer, with over $95 million already achieved 2 Commercial syner
Slide 8: Agenda
GTLS: GAS TO LIQUID SYSTEMS® 8© 2023 Chart Industries, Inc. Confidential and Proprietary Agenda Q2 2023 Results Market and Demand Update Synergy Update Progress on Deleveraging 2023 Outlook
Slide 9: Macro Activity
GTLS: GAS TO LIQUID SYSTEMS® Macro Activity 9 # End Market Recent News 1 CCUS • Wyoming and Colorado signed an MoU to accelerate the development and activity of direct air capture, highlighting combined assets, infrastructure, policies 2 Hydrogen • U.S. National Clean Hydrogen Strategy and Roadmap r
Slide 10: Chart End Market Trends
GTLS: GAS TO LIQUID SYSTEMS® Chart End Market Trends 10 # End Market Recent Activity Trend 1 Aftermarket, service, repair • Penetration of Howden and Chart installed base plus competitors’ installed base • Very strong multi-year agreements being executed in mine safety, LNG stations, broad geographi
Slide 11: Chart's End Market Opportunity Pipeline
GTLS: GAS TO LIQUID SYSTEMS® © 2023 Chart Industries, Inc. Confidential and Proprietary 11 Chart’s End Market Opportunity Pipeline End Market One Year Ago June 30, 2022 Prior Quarter March 31, 2023* Current Quarter June 30, 2023* Big LNG • $5.35 billion • 24 projects • 3 intl projects (potential IPS
Slide 12: Agreements / MOUs / Partnerships New and Expanded
GTLS: GAS TO LIQUID SYSTEMS® 43 Agreements / MOUs / Partnerships New and Expanded 12 Category Q1 2023 Total New MOUs # of partnerships expanded to both Chart & Howden as of April 27, 2023 # of new or expanded partnerships to both Chart & Howden (April 27, 2023 to July 27, 2023) Total # of MOUs/partn
Slide 13: 2023 Demand Strength Continues
GTLS: GAS TO LIQUID SYSTEMS® 13 2023 Demand Strength Continues • 133 orders each greater than $1 million booked • 19 orders each greater than $5 million booked • 8 orders each greater than $10 million booked: • Big LNG BAHX/cold box equipment order • Private space exploration customer tanks includin
Slide 14: First-of-a-Kinds, New Customers and RSL Strength
GTLS: GAS TO LIQUID SYSTEMS® First-of-a-Kinds, New Customers and RSL Strength 14 22 First-of-a-Kind Orders in the Second Quarter 2023 including: • World’s largest cryogenic tanks (1700 cubic meters) for space exploration • Novel fan design for the new metro train platform of a large rail company 86
Slide 15: Input Costs Continue to Temper
GTLS: GAS TO LIQUID SYSTEMS® Input Costs Continue to Temper 15Sources: LME (Aluminum), MEPS (Carbon and Stainless Steel), Freightos
Slide 16: Agenda
GTLS: GAS TO LIQUID SYSTEMS® 16© 2023 Chart Industries, Inc. Confidential and Proprietary Agenda Q2 2023 Results Market and Demand Update Synergy Update Progress on Deleveraging 2023 Outlook
Slide 17: Second Quarter 2023 Results
GTLS: GAS TO LIQUID SYSTEMS® Second Quarter 2023 Results 17 (1) Adjusted gross margin, EBITDA, and Adjusted EBITDA and Adjusted Diluted EPS are not measures of financial performance under U.S. GAAP and should not be considered as an alternative to net income (in the case of EBITDA and Adjusted EBITD
Slide 18: Q2 2023 Sales and Gross Margin Trends
GTLS: GAS TO LIQUID SYSTEMS® $312 $289 $322 $328 $379 $354 $405 $412 $441 $532 $908 28.1% 29.1% 25.8% 22.8% 21.7% 23.6% 23.4% 25.4% 28.2% 28.1% 30.9% 28.7% 29.9% 29.0% 26.5% 24.2% 26.1% 25.3% 27.3% 29.9% 28.5% 32.5% 20.0% 25.0% 30.0% $200 $300 $400 $500 $600 $700 $800 $900 $1,000 Q4'20 Q1'21 Q2'21 Q
Slide 19: Agenda
GTLS: GAS TO LIQUID SYSTEMS® 19© 2023 Chart Industries, Inc. Confidential and Proprietary Agenda Q2 2023 Results Market and Demand Update Synergy Update Progress on Deleveraging 2023 Outlook
Slide 20: Synergy Achievement to Date
GTLS: GAS TO LIQUID SYSTEMS® 20 # Category Description Synergy orders (Revenue) achieved to date $ millions Annualized cost savings achieved to date $ millions Original annualized year-one target $ millions 1 Cost Sourcing $40.1 $70 2 Cost Optimization and organization 55.6 70 3 Cost Facilities 0.7
Slide 21: Chart and Howden Creating Early Synergies in the Middle East
Chart and Howden Creating Early Synergies in the Middle East 21 How are we leveraging the combined company in the Middle East? • Chart and Howden each had sales people in the Middle East region before the acquisition and these resources now work together in our OneChart global commercial organizatio
Slide 22: One Chart – One Culture
GTLS: GAS TO LIQUID SYSTEMS® One Chart – One Culture “I am very happy to see this welding program and expect it to bring much more value to Howden Canada on welding and operational guidelines, further improving our quality of welding, delivery & productivity “Howden-Hosur has successfully completed
Slide 23: Leveraging Our Strong Global Talent
GTLS: GAS TO LIQUID SYSTEMS® 23 Leveraging Our Strong Global Talent ➢Howden China team member recognized as “Shandong Model Worker” for being an outstanding model worker ➢Howden Tech Sponsors support local universities by presenting a prize to outstanding final year presenters ➢ChartWater PM passed
Slide 24: Agenda
GTLS: GAS TO LIQUID SYSTEMS® 24© 2023 Chart Industries, Inc. Confidential and Proprietary Agenda Q2 2023 Results Market and Demand Update Synergy Update Progress on Deleveraging 2023 Outlook
Slide 25: Cash and Balance Sheet Activities
GTLS: GAS TO LIQUID SYSTEMS® Cash and Balance Sheet Activities 25 1. Action completed totaling approximately $220 million in additional capacity and over $2.26 million in cost savings a) Howden acquisition working capital settlement ($17.5 million; cash received July 26, 2023) b) Executed two buildi
Slide 26: Accelerating Net Leverage Reduction
GTLS: GAS TO LIQUID SYSTEMS® Q2 2023 Act Midyear 2024 Fcst Net Leverage (bank EBITDA) Net Leverage (covenant ceiling) Accelerating Net Leverage Reduction 26 3.86X 2.5-2.9X 4.5X 6.0X Debt Covenant: Net Debt/ LTM Adjusted EBITDA(1) ▪ Reiterate our financial policy that until we are within our target n
Slide 27: Agenda
GTLS: GAS TO LIQUID SYSTEMS® 27© 2023 Chart Industries, Inc. Confidential and Proprietary Agenda Q2 2023 Results Market and Demand Update Synergy Update Progress on Deleveraging 2023 Outlook
Slide 28: 2023 Consolidated Chart Industries Outlook
GTLS: GAS TO LIQUID SYSTEMS® © 2023 Chart Industries, Inc. Confidential and Proprietary 28 2023 Consolidated Chart Industries Outlook $ millions except per share amounts Continuing Operations Guidance Metrics as of July 28, 2023 Revenue $3,660 - $3,800 Adjusted EBITDA (1) $780 - $810 Adjusted Free c
Slide 29: Growth Acceleration in H2 2023
GTLS: GAS TO LIQUID SYSTEMS® Growth Acceleration in H2 2023 © 2023 Chart Industries, Inc. Confidential and Proprietary 29 • Six months of Howden EBITDA and FCF in H2 2023 vs. Three months and 10 days in H1 2023 • Cost Synergies ramp in H2 vs H1, on track for $175 million of annualized cost synergies
Slide 30: Pro Forma Adjusted EBITDA 2023 and 2024 Combined Chart + Howden
GTLS: GAS TO LIQUID SYSTEMS® Pro Forma Adjusted EBITDA 2023 and 2024 Combined Chart + Howden 30 • Revenue growth led by energy transition markets and backlog conversion • Implied organic volume leverage of ~30% • Favorable mix driven by energy transition verticals • Cost synergies embedded in margin
Slide 31: Thank you to the Chart Global Team!
GTLS: GAS TO LIQUID SYSTEMS® 31 Thank you to the Chart Global Team! Safety First: • Total recordable incident rate (TRIR) of 0.57 • 71% of our locations are injury free one year or more. • Our Chennai, Hosur, India Decin, CR, Canton, GA (USA) and Frankenthal, Germany facilities achieved 1 million or
Slide 32: Fpip gy
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Slide 33: Second Quarter 2023 Adjusted EPS
GTLS: GAS TO LIQUID SYSTEMS® Second Quarter 2023 Adjusted EPS © 2023 Chart Industries, Inc. Confidential and Proprietary 33 (1) Tax effect reflects adjustment at normalized periodic rates (2) Adjusted Basic EPS, Normalized Basic EPS, Adjusted Diluted EPS, and Normalized Diluted EPS (all non-GAAP mea
Slide 34: Second Quarter 2023 Free Cash Flow
GTLS: GAS TO LIQUID SYSTEMS® Second Quarter 2023 Free Cash Flow © 2023 Chart Industries, Inc. Confidential and Proprietary 34 (1) Free cash flow” and “adjusted free cash flow” are not measures of financial performance under U.S. GAAP and should not be considered as an alternative to net cash provide
Slide 35: Second Quarter 2023 Adjusted EBITDA
GTLS: GAS TO LIQUID SYSTEMS® 35 Second Quarter 2023 Adjusted EBITDA (1) EBITDA and Adjusted EBITDA are not measures of financial performance under U.S. GAAP and should not be considered as an alternative to net income in accordance with U.S. GAAP. Management believes that EBITDA and Adjusted EBITDA
Slide 36: Q2 2023 Sales and EBITDA Margin Trends
GTLS: GAS TO LIQUID SYSTEMS® 36 Q2 2023 Sales and EBITDA Margin Trends $289 $322 $328 $379 $354 $405 $412 $441 $532 $908 17.1% 9.8% 13.6% 10.6% 10.4% 10.8% 16.2% 23.1% 12.4% 17.5% 19.0% 18.7% 15.3% 15.3% 15.5% 16.2% 18.9% 22.1% 18.9% 21.5% 5.0% 10.0% 15.0% 20.0% 25.0% $200 $250 $300 $350 $400 $450 $
Slide 37: Second Quarter 2023 Net Income Bridge
GTLS: GAS TO LIQUID SYSTEMS® Second Quarter 2023 Net Income Bridge © 2020 Chart Industries, Inc. Confidential and Proprietary 37 $ millions, except per share amounts Q2 2023, Reported Adjustments Q2 2023, AdjustedContinuing Operations Sales $908.1 - $908.1 Cost of sales 627.5 (14.1) 613.4 Gross prof
Slide 38: Q2 2023 Addback Detail
GTLS: GAS TO LIQUID SYSTEMS® Q2 2023 Addback Detail © 2023 Chart Industries, Inc. Confidential and Proprietary 38 Main category Detailed Description Q2 2023 gross amount (+ added to / (-) reduced income) Impact to operating income Repeating in Q3-Q4 2023? 1 Mark-to-Market of inorganic investments •
Slide 39: Segment Information
GTLS: GAS TO LIQUID SYSTEMS® 39 Segment Information (1) Adjusted gross margin is not a measure of financial performance under U.S. GAAP. Please see reconciliation at end of the accompanying earnings release for a reconciliation to the relevant GAAP metric. Sales ($M, except %) Q2 ‘23 Q1 ‘23 % Chg PQ
Slide 40: Segment Information
GTLS: GAS TO LIQUID SYSTEMS® 40 Segment Information (1) Adjusted operating margin is not a measure of financial performance under U.S. GAAP. Please see reconciliation at end of the accompanying earnings release for a reconciliation to the relevant GAAP metric. Sales ($M, except %) Q2 ‘23 Q1 ‘23 % Ch