Slide 1: Fourth Quarter and Full Year 2021 Results
Zebra Technologies Fourth Quarter and Full Year 2021 Results February 10, 2022 ZEBRA TECHNOLOGIES
Slide 2: Safe Harbor Statement
Insert Section Title Here Safe Harbor Statement Statements made in this presentation which are not statements of historical fact are forward-looking statements and are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Actual results may differ fro
Slide 3: Agenda
Agenda 01 2021 Highlights Anders Gustafsson, CEO 02 Q4 Financials and 2022 Outlook Nathan Winters, CFO 03 Advancing Our Enterprise Asset Intelligence Vision, Served Market Update Anders Gustafsson, CEO 04 Q&A Anders Gustafsson, CEO Nathan Winters, CFO Joe Heel, Chief Revenue Officer ZEBRA TECHNOLOGI
Slide 4: Fourth Quarter and Full Year 2021 Highlights
Fourth Quarter and Full Year 2021 Highlights (1) 4Q21 +11.7% 21.7% $4.54 ADJUSTED NET ADJUSTED NON-GAAP SALES GROWTH EBITDA MARGIN DILUTED EPS +10.0%(1) Organic (180)bps YoY +2% YoY FY21 +26.4% 23.0% $18.45 $1.0B ADJUSTED NET ADJUSTED NON-GAAP FREE CASH SALES GROWTH EBITDA MARGIN DILUTED EPS FLOW +2
Slide 5: Agenda
Agenda 01 2021 Highlights Anders Gustafsson, CEO 02 Q4 Financials and 2022 Outlook Nathan Winters, CFO 03 Advancing Our Enterprise Asset Intelligence Vision, Served Market Update Anders Gustafsson, CEO 04 Q&A Anders Gustafsson, CEO Nathan Winters, CFO Joe Heel, Chief Revenue Officer ZEBRA TECHNOLOGI
Slide 6: Fourth Quarter P&L Summary
Fourth Quarter P&L Summary(1) SEGMENT ORGANIC SALES GROWTH(2,3) In millions, except per share data 4Q21 4Q20 Change • EVM Segment +13.2% • AIT Segment +3.1% Adjusted Net Sales $1,467 $1,313 +11.7% REGIONAL ORGANIC SALES GROWTH(2,3) Organic Net Sales Growth(2,3) +10.0% • North America +4% Adjusted Gr
Slide 7: Cash Flow & Balance Sheet Highlights
Cash Flow & Balance Sheet Highlights Cash Flow: FY 2021 Strong Liquidity Position: YE 2021 • $1,010M free cash flow • $332M cash & cash equivalents – $115M higher YoY primarily due to higher net • $996M total debt on balance sheet income • Net-debt-to-adjusted-EBITDA ratio of 0.5x • $452M acquisitio
Slide 8: Global Premium Freight Costs Have Escalated Through Pandemic
Global Premium Freight Costs Have Escalated Through Pandemic Expected to Abate as Component Supply and Freight Capacity Improves 63 In Millions of USD Estimate 21 ~$140-160M FY22 Impact 17 12 11 2 2 -3 -4 -3 -4 -3 ZEBRA TECHNOLOGIES 8 Note: Premium Freight calculation compared to pre-pandemic rates
Slide 9: Outlook & Assumptions
Outlook & Assumptions 1Q22 FY22 • Adjusted net sales growth ~ 3-7% YoY • Adjusted net sales growth ~ 1-3% YoY • Neutral impact from recently acquired business and FX (1) • ~ 1 percentage point additive impact from recently acquired business and FX(1) • Adjusted EBITDA margin ~ 23-24% • Adjusted EBIT
Slide 10: Agenda
Agenda 01 2021 Highlights Anders Gustafsson, CEO 02 Q4 Financials and 2022 Outlook Nathan Winters, CFO 03 Advancing Our Enterprise Asset Intelligence Vision, Served Market Update Anders Gustafsson, CEO 04 Q&A Anders Gustafsson, CEO Nathan Winters, CFO Joe Heel, Chief Revenue Officer ZEBRA TECHNOLOGI
Slide 11: Zebra Digitizes & Automates the Front Line of Business
Zebra Digitizes & Automates the Front Line of Business Transforming Workflows: Purpose-Built Hardware + Software + Cloud Analytics Real-Time Actionable Insights ZEBRA TECHNOLOGIES 11
Slide 12: Zebra Well Positioned for 5-7% L-T Organic Sales Growth in $30B Served Market
Zebra Well Positioned for 5-7% L-T Organic Sales Growth in $30B Served Market Attractive Adjacent & Expansion Opportunities Augment Our Vibrant Core Expansion Fixed Industrial Megatrends Scanning / Machine Vision Smart Cameras On-Demand Economy IoT & Asset Visibility Mobility & Cloud Computing Smart
Slide 13: Zebra Optimizes Workflows for the On-Demand Economy
Zebra Optimizes Workflows for the On-Demand Economy Trusted Strategic Partner to Industry Leaders Retail & Other Markets Includes Government, Ecommerce Education, Hospitality Healthcare Transportation & Logistics Note: Pie chart represents estimated FY21 sales by vertical end-market ZEBRA TECHNOLOGI
Slide 14: Agenda
Agenda 01 2021 Highlights Anders Gustafsson, CEO 02 Q4 Financials and 2022 Outlook Nathan Winters, CFO 03 Advancing Our Enterprise Asset Intelligence Vision, Served Market Update Anders Gustafsson, CEO 04 Q&A Anders Gustafsson, CEO Nathan Winters, CFO Joe Heel, Chief Revenue Officer ZEBRA TECHNOLOGI
Slide 15: Q&A
Q&A ZEBRA TECHNOLOGIES
Slide 16: Appendix
Appendix ZEBRA TECHNOLOGIES 16
Slide 17: Use of Non-GAAP Financial Information
Use of Non-GAAP Financial Information This earnings release contains certain Non-GAAP financial measures, consisting of “adjusted net sales,” “adjusted gross profit,” “EBITDA,” “Adjusted EBITDA,” “Non-GAAP net income,” “Non-GAAP earnings per share,” “free cash flow,” “organic net sales growth,” and
Slide 18: GAAP to Non-GAAP Organic Net Sales Growth Reconciliation
GAAP to Non-GAAP Organic Net Sales Growth Reconciliation (Unaudited) Three Months Ended December 31, 2021 AIT EVM Consolidated Reported GAAP Consolidated Net sales growth 4.5 % 15.2 % 12.2 % Adjustments: Impact of foreign currency translations (1) (1.4)% (0.8)% (1.4)% Impact of acquisitions (2) —% (
Slide 19: GAAP to Non-GAAP Gross Margin Reconciliation
(In millions) GAAP to Non-GAAP Gross Margin Reconciliation (Unaudited) Three Months Ended December 31, 2021 December 31, 2020 AIT EVM Consolidated AIT EVM Consolidated GAAP Reported Net sales (1) $ 444 $ 1,023 $ 1,467 $ 425 $ 888 $ 1,308 Reported Gross profit (1) 190 479 669 204 421 618 Gross Margin
Slide 20: GAAP to Non-GAAP Net Income Reconciliation
GAAP to Non-GAAP Net Income Reconciliation Three Months Ended Twelve Months Ended December 31, December 31, December 31, December 31, 2021 2020 2021 2020 Net income $ 191 $ 199 $ 837 $ 504 Adjustments to Net sales(1) Purchase accounting adjustments — 5 6 7 (In millions, except Total adjustments to N
Slide 21: GAAP to Non-GAAP EBITDA Reconciliation
(In millions) GAAP to Non-GAAP EBITDA Reconciliation (Unaudited) Three Months Ended Twelve Months Ended December 31, December 31, December 31, December 31, 2021 2020 2021 2020 Net income $ 191 $ 199 $ 837 $ 504 Add back: Depreciation (excluding exit and restructuring costs) 18 16 72 67 Amortization
Slide 22: GAAP to Non-GAAP Free Cash Flow Reconciliation
(In millions) GAAP to Non-GAAP Free Cash Flow Reconciliation (Unaudited) Twelve Months Ended December 31, December 31, 2021 2020 Net cash provided by operating activities $ 1,069 $ 962 Less: Purchases of property, plant and equipment (59) (67) Free cash flow (Non-GAAP)(1) $ 1,010 $ 895 1. Free cash
Slide 23: About Zebra
About Zebra Zebra (NASDAQ: ZBRA) empowers the front line of business in retail, manufacturing, transportation and logistics, healthcare, and other industries to achieve a performance edge. We deliver industry-tailored, end-to-end solutions that intelligently connect people, assets and data to help o