Slide 1: Bruker Corporation Q4 2014 Earnings Presentation
Bruker Corporation (NASDAQ: BRKR) Q4 2014 Earnings Presentation Frank Laukien, President & CEO Charles Wagner, EVP & CFO February 19, 2015 Joshua Young, VP, Investor Relations Innovation with Integrity
Slide 2: Safe Harbor & Reg. G Statement
Bruker Corporation Safe Harbor & Reg. G Statement Any statements contained in this presentation that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained he
Slide 3: Q4 & FY 2014 Business Update
Q4 & FY 2014 Business Update © Bruker Corporation 3
Slide 4: Q4-14 performance: lower revenue and EPS were in-line with expectations
Q4-14 performance: lower revenue and EPS were in-line with expectations Q4 2014 Performance Q4-14 Financials Revenues decline -$44M, or -8%, year-over- Revenues [$ m] -8% year − Changes in foreign exchange rates lower 552 revenues by -$34M, or -6% 508 − CAM divestitures result in -$8M year- over-y
Slide 5: FY 2014 performance reflects currency headwinds & softness in NMR and X-Ray markets
FY 2014 performance reflects currency headwinds & softness in NMR and X-Ray markets FY 2014 Performance FY 2014 Financials Revenue decline of -2% y-o-y; flat organic growth 1. BIOSPIN revenues flat; good year in Revenues [$ B] -2% Pre-Clinical Imaging division offset by second-half declines in NMR
Slide 6: FY 2014 Performance: Group Overview
GROUP OVERVIEW: FY 2014 Performance Bruker BIOSPIN Group ($623M revenue) Revenues decline in NMR business, as demand for high-field systems remains muted Pre-Clinical Imaging Division delivers robust double-digit growth, as demand for higher-field MRI systems drives growth Good growth in the A
Slide 7: FY 2014 Performance: Group Overview
GROUP OVERVIEW: FY 2014 Performance Bruker NANO Group ($498M revenue) Solid growth in Nano Surfaces and Nano Analytics divisions, as academic and research markets strengthen Prairie and Vutara acquisitions added ~$11M to revenue in FY-14 Bookings growing in Nano Surfaces Division during H2 as
Slide 8: Bruker 2015 Priorities
Bruker 2015 Priorities Continue transformation of leadership, management processes, and systems Execute BIOSPIN rightsizing and footprint consolidation Accelerate further outsourcing of high- level assemblies in CALID and NANO Re-accelerate profitable growth in portfolio with new products and by ent
Slide 9: Q4 2014 Financial Update
Q4 2014 Financial Update © Bruker Corporation 9
Slide 10: Q4 2014 Overview
NON-GAAP FINANCIAL PERFORMANCE: Q4 2014 Overview [$ m, except EPS] Q4 2014 Q4 2013 Δ COMMENTS Revenues 508.0 552.1 -8% Revenues are nearly flat, after adjusting for FX and Operating Income 63.7 81.3 -22% CAM divestitures Margin (%) 12.5% 14.7% Free cash flow decline is result of lower net income
Slide 11: Q4 2014 Non-GAAP Results
Q4 2014 Non-GAAP Results [$ m, except EPS] Q4 2014 Q4 2013 Δ COMMENTS Total Revenues 508.0 552.1 -8% FX reduces revenue by Gross Profit 223.2 248.3 -10% -$34M and gross profit Margin (% of revenues) 43.9% 45.0% by -$16M; no material effect on gross margin as SG&A -117.9 -117.9 NM % of revenues (%
Slide 12: Q4 2014 Reconciliation of GAAP and Non-GAAP Results
Q4 2014 Reconciliation of GAAP and Non-GAAP Results [$ m, except EPS] Q4 2014 Q4 2013 GAAP Operating Income 44.5 61.0 Restructuring Costs 6.8 11.7 Acquisition Related Costs 1.0 2.3 Purchased Intangible Amortization 5.1 5.4 Other Costs 6.3 0.9 TOTAL 19.2 20.3 Non-GAAP Operating Income 63.7 81.3 Non-G
Slide 13: FY 2014 revenue bridge
FY 2014 revenue bridge FY 2014 DRIVERS FY 2014 Revenue for Bruker Corp. Organic revenue decline Acquisitions & of -0.4% Organic Currency Divestitures Total CAM reduces FY14 -0.4% -1.4% 0.1% -1.7% organic revenue growth by nearly 1% Big currency swings in Q4 drove overall FY 2014 Revenue Bridge
Slide 14: FY 2014 Non-GAAP Results
FY 2014 Non-GAAP Results [$ m, except EPS] FY 2014 FY 2013 Δ COMMENTS Total Revenues 1,808.9 1,839.4 -2% Gross margins are flat y-o-y after adjusting for Gross Profit 807.7 832.5 -3% currency Margin (% of revenues) 44.7% 45.3% SG&A -449.1 -436.5 3% Lower R&D spend (% of revenues) 24.8% 23.7% ref
Slide 15: FY 2014 Reconciliation of GAAP to Non-GAAP Results
FY 2014 Reconciliation of GAAP to Non-GAAP Results [$ m, except EPS] FY 2014 FY 2013 GAAP Operating Income 105.4 148.2 Restructuring Costs 36.1 25.3 Acquisition Related Costs 4.0 4.5 Purchased Intangible Amortization 20.2 20.7 Other Costs 18.7 6.8 TOTAL 79.0 57.3 Non-GAAP Operating Income 184.4 205.
Slide 16: FY 2014 Cash Flow Statement
FY 2014 Cash Flow Statement [$ m] FY 2014 FY 2013 Δ COMMENTS Net Income 59.6 81.8 -22.2 FY-14 free cash flow decline due to lower net income, partially offset Depreciation & amortization 59.7 61.3 -1.6 by lower capex spending Changes in working capital* -1.6 -10.6 9.0 Lower net income impacted b
Slide 17: 2015 Outlook
2015 Outlook © Bruker Corporation 17
Slide 18: Changes in currency continue to be strong headwind to revenue and EPS in 2015
Changes in currency continue to be strong headwind to revenue and EPS in 2015 FX y-o-y effect 2014* FX y-o-y effect 2015E** ($22m) ($17m) ($25m) ($0.09) ($0.08) ($135m) Revenue Non-GAAP Op. EPS Revenue Non-GAAP Op. EPS Profit Profit *Difference between 2013 average FX rates and 2014 average FX rates
Slide 19: Bruker FY 2015 Outlook
Bruker FY 2015 Outlook FY 2015 Financial Outlook 2015 ASSUMPTIONS Changes in currency Revenues (organic) Approximately +1% y-o-y reduce revenues by 7-8%, with biggest impact in Q1-Q3 Non-GAAP Operating Margin >100 bps y-o-y CAM related revenues decrease by $50M in 2015 Non-GAAP EPS Approximately
Slide 20: Appendix
Appendix © Bruker Corporation 20
Slide 21: Q4 2014 GAAP Results
Q4 2014 GAAP Results [$ m, except EPS] Q4 2014 Q4 2013 Δ Total Revenues 508.0 552.1 -8% Gross Profit 215.8 235.9 -9% Margin (% of sales) 42.5% 42.7% SG&A -118.5 -118.3 NM (% of revenues) 23.3% 21.4% R&D -41.6 -49.1 -15% (% of revenues) 8.2% 8.9% Operating Income 44.5 61.0 -27% (% of revenues) 8.8% 1
Slide 22: Q4 2014 revenue bridge
Q4 2014 revenue bridge Q4 2014 DRIVERS Q4 2014 Revenue for Bruker Corp. Organic revenue decline Acquisitions & of -0.5% primarily result Organic Currency Divestitures Total of lower BEST revenue in Q4-14 -0.5% -6.2% -1.3% -8.0% Currency effect of -$34M is the result of the dollar strengthening a
Slide 23: Q4 2014 Cash Flow Statement
Q4 2014 Cash Flow Statement [$ m] Q4 2014 Q4 2013 Δ Net Income 26.5 35.9 -9.4 Depreciation & amortization 12.1 15.9 -3.8 Changes in working capital* -4.4 22.0 -26.4 Other 35.1 57.6 -22.5 Operating cash flow 69.3 131.4 -62.1 Capital expenditures -7.1 -9.0 1.9 Free cash flow 62.2 122.4 -60.2 * WC = (A
Slide 24: Balance sheet
Balance sheet [$ m] Dec 31, 2014 Dec 31, 2013 Δ Total Assets 1,864.8 1,988.3 -6% Working Capital* 694.6 822.6 -16% Intangible & Other Long-Term Assets 248.6 256.9 -3% [$ m] Dec 31, 2014 Dec 31, 2013 Δ Cash, Cash Equivalents & Short-term 497.5 438.7 13% Investments Financial Debt 355.0 355.0 NM Net C
Slide 25: FY 2014 GAAP Results
FY 2014 GAAP Results [$ m, except EPS] FY 2014 FY 2013 Δ Total Revenues 1,808.9 1,839.4 -2% Gross Profit 763.3 805.2 -5% Margin (% of sales) 42.2% 43.8% SG&A -451.0 -437.9 3% (% of revenues) 24.9% 23.8% R&D -174.2 -190.5 -9% (% of revenues) 9.6% 10.4% Operating Income 105.4 148.2 -29% (% of revenues
Slide 26: BSI and BEST GAAP Performance
Q4 SEGMENT RESULTS: BSI and BEST GAAP Performance [$ m] Q4 2014 Q4 2013 Δ REVENUE Scientific Instruments (BSI) 475.8 511.0 -7% Organic Revenue Growth (%) 0.6% 5.9% Energy & Supercon Technologies (BEST) 36.7 46.6 -21% Organic Revenue Growth (%) -14.1% 17.4% Corporate Eliminations & Other -4.5 -5.5 To