Generac Holdings Inc. · NYSE:GNRC
Generac — Generac Holdlings — Q1 2024 Earnings Presentation
26 slides from Generac's earnings presentation, May 1, 2024
Slide 1: Investor Presentation
GENERAC INVESTOR PRESENTATION May 2024 OUR PURPOSE: Lead the evolution to more resilient, efficient, and sustainable energy solutions.
Slide 2: Investor Relations
GENERAC 2 INVESTOR RELATIONS Aaron Jagdfeld PRESIDENT & CEO York Ragen CHIEF FINANCIAL OFFICER Kris Rosemann SENIOR MANAGER – CORPORATE DEVELOPMENT & INVESTOR RELATIONS (262) 506-6064 InvestorRelations@generac.com
Slide 3: Forward Looking Statements
GENERAC 3 Forward Looking Statements Certain statements contained in this presentation, as well as • our ability to protect our intellectual property rights or • compliance with environmental, health and safety laws and other information provided from time to time by Generac successfully defend agai
Slide 4: Generac Overview
Generac LTM NET SALES $4.0 BILLION LTM NET SALES MIX: 80% DOMESTIC 20% INTERNATIONAL RESIDENTIAL* 51% LTM ADJ EBITDA $665 MILLION LTM FREE CASH FLOW $523 MILLION ~8,600 EMPLOYEES WORLDWIDE AS OF 12/31/2023 COMMERICAL & INDUSTRIAL a ~1,100 ENGINEERS WORLDWIDE AS OF 12/31/2023 OTHER* 12% OMNI CHANNEL
Slide 5: Generac Global Footprint
GENERAC 5 Generac Global Footprint
Slide 6: Track Record of Growth
GENERAC 6 $6,000 15% REVENUE CAGR Track Record 2010 IPO Through 2024F of Growth $5,000 Each growth cycle $4,000 creates new & higher baseline $3,000 $2,000 $1,000 $- '00 '02 '04 '06 '08 '10 '12 '14 '16 '18 '20 '22 '24F Note: $ amounts in millions. Represents net sales. Figures include results from
Slide 7: Mega-Trends Review
GENERAC 7 Mega-Trends Review "Grid 2.0” - Evolution of the traditional electrical Emergence of cleaner alternative fuels utility model • Natural gas and other alternative fuels are • Increasing intermittent generation sources and vital to the energy transition electrification of everything • Cleaner
Slide 8: A Growing Problem – Supply/Demand Imbalance
GENERAC 8 A Growing Problem – Supply/Demand Imbalance • SUPPLY RELIABILITY DETERIORATING • DEMAND GROWTH ACCELERATING • Climate change & severe weather • Electrification of everything • One-way system prone to outage • Transportation, HVAC, appliances • Infrastructure underinvestment • Data centers
Slide 9: Powering a Smarter World
GENERAC 9 Powering a Smarter World OUR PURPOSE: Lead the evolution to more resilient, efficient, and sustainable energy solutions.
Slide 10: Broad Product and Solutions Offerings Address Strategic Opportunities
GENERAC 10 Broad Product and Solutions Offerings Address Strategic Opportunities Home Standby Residential Energy C&I Natural Gas C&I BESS Generator Storage Generator Propane Tank Monitor Generator Controls EV Charger Smart Thermostat Residential Load Manager C&I Connectivity Telecom Generator Mobile
Slide 11: Building a Residential Energy Ecosystem
GENERAC 11 Building a Residential Energy Ecosystem Power Generation & Storage + Monitoring & Management Devices + Platform & Controls + Grid Services Residential Products LTM Net Sales 5% 95% Multiple hardware devices connected to a single interface to optimize the consumption and generation of ener
Slide 12: Massive HSB Penetration Opportunity
GENERAC 12 Massive HSB Penetration Opportunity Widespread growth potential: • Total US penetration rate ~6.25% as of 2023 • Highest penetrated markets are 15-20%+ and growing Mega-trends and competitive advantages expected to drive robust growth: • Targeted Marketing drives growing demand for long d
Slide 13: Residential Energy Technology Market Opportunity
GENERAC 13 Residential Energy Technology Market Opportunity Rebuilding Clean Energy Portfolio Expanding ecobee Portfolio To With Quality First Develop The Home Energy Hub • Major investments in talent and • Leveraging award-winning Large and growing markets: infrastructure necessary to win technolog
Slide 14: Building a Commercial & Industrial Energy Ecosystem
GENERAC 14 Building a Commercial & Industrial Energy Ecosystem Power Generation & Storage + Monitoring & Management Devices + Platform & Controls & Monitor Connect + Grid Services C&I Products LTM Net Sales 40% 60% Turnkey solutions managed through a single interface integrating multiple DERs to opt
Slide 15: Generac's Solution To Address The Industrial Customer Energy Journey
GENERAC PRESENTATION TITLE 15 Generac’s Solution To Address The Industrial Customer Energy Journey CUSTOMER ENTRY POINT Infrastructure & Equipment Energy Programs & Solutions Energy Efficiency and Sustainability - Backup Power - Grid Services and VPP - Battery Energy Storage - Facility Expansion - D
Slide 16: Financial Summary
GENERAC 16 Financial Summary Total Net Sales Gross Margin % Adjusted EBITDA Adjusted EBITDA margin % $5,000 55.0% $1,000 35.0% $4,000 50.0% $800 30.0% $3,000 45.0% $600 25.0% $2,000 40.0% $400 20.0% $1,000 35.0% $200 15.0% $0 30.0% $0 10.0% 2019 2020 2021 2022 2023 2024F* 2019 2020 2021 2022 2023 20
Slide 17: Business Outlook
GENERAC 17 Business Outlook Historical Seasonality Net Sales 55% 53% 55% 2024F Guidance As Reported On May 1, 2024** 45% 47% 45% Consolidated net sales • Consolidated revenue: increase between 3% to 7% H1 2015- H2 2015- H1 2023 H2 2023 H1 2024F* H2 2024F* • Residential products: increase at a low do
Slide 18: Disciplined & Balanced Capital Allocation
GENERAC 18 Disciplined & Balanced Capital Allocation 1. Organic CapEx CapEx as % of Net Sales 2. Strategic M&A Growth $150 $129 10.0% Accelerating “Powering A $127 Smarter World” Strategy $120 $110 8.0% Investment in technology, $86 Demonstrated ability to In Millions $90 6.0% innovation, R&D capabi
Slide 19: Appendix
APPENDIX GENERAC EEE
Slide 20: HSB: A Penetration Story
GENERAC 20 HSB: A Penetration Story North American Penetration Opportunity(1) 90% 88.3% 80% Aging Population Fits Demographic 70% • ~75% of buyers age 50 and older % of US Addressable Market 60% • ~$500k median home value • ~80-85% retro-fit application 50% 40% • ~$135K median household income 30% 2
Slide 21: HSBs are the Solution for Extended Power Outages
GENERAC 21 HSBs are the Solution for Extended Power Outages The only worry-free, Outage Backup (Hrs) whole-home solution Standalone 18kWh Storage* for long outages Solar + 18kWhStorage* Ford F150 Lightning Lariat** Home Standby 24kw 0 20 40 60 80 100 120 The most cost- Installed Cost effective solut
Slide 22: Expanding Power Outage Severity
GENERAC 22 Expanding Power Outage Severity1 Total Outage Hours (Severity) Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 (1) Represents power outage hours for mainland U.S. only
Slide 23: Q1 2024 & LTM Financial Overview
GENERAC 23 Q1 2024 & LTM Financial Overview Actual Y/Y % Actual Y/Y % Q1 2024 Change LTM Change (unaudited) (unaudited) Residential $ 429.0 2.4% 2,073.0 (18.8%) Commercial & Industrial 354.0 (2.5%) 1,485.8 10.5% Other 106.4 0.3% 465.2 11.3% Net Sales $ 889.3 0.2% $ 4,024.0 (6.8%) Gross Profit $ 316.
Slide 24: Adjusted EBITDA Reconciliation
GENERAC 24 Adjusted EBITDA Reconciliation 2020 2021 2022 2023 LTM Net income $ 347.2 $ 556.6 $ 408.9 $ 217.1 $ 229.4 Interest expense 33.0 33.0 54.8 97.6 98.2 Depreciation and amortization 68.8 92.0 156.1 166.6 168.6 Income taxes provision 99.0 135.0 99.6 73.2 77.4 Non-cash write-down and other char
Slide 25: Adjusted EBITDA Reconciliation
GENERAC 25 Adjusted EBITDA Reconciliation Three months ended Net income to Adjusted EBITDA reconciliation March 31, LTM Ended March 31, 2024 2023 2024 2023 (unaudited) (unaudited) Net income attributable to Generac Holdings. Inc. $ 26,232 $ 12,430 $ 228,408 $ 298,074 Net income attributable to nonco
Slide 26: Adjusted Net Income Reconciliation
GENERAC 26 Adjusted Net Income Reconciliation Net income to Adjusted net income reconciliation Three months ended March 31, LTM Ended March 31, 2024 2023 2024 2023 (unaudited) (unaudited) Net income attributable to Generac Holdings. Inc. $ 26,232 $ 12,430 $ 228,408 $ 298,074 Net income attributable