Spx Technologies, Inc. · NYSE:SPXC

Spx Technologies — Investor Day (March 2024)

107 slides from Spx Technologies's investor day presentation, Mar 26, 2024

Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements contained in this presentation that are not historical facts, including any statements as to future market conditions, results of operations, products introductions, and financial projections, are forward-looking statements within the meaning of Section 27A o
Slide 4: Agenda Summary
Agenda Summary 1 Welcome and Introductions Paul Clegg, VP, Investor Relations & Communications 5 minutes 6 Detection & Measurement Growth Strategy John Swann, President, Detection & Measurement Segment 20 minutes 2 SPX: Past, Present & Future Gene Lowe, President & Chief Executive Officer 15 minutes
Slide 6: Speaker Biography Gene Lowe
Speaker Biography ▪ President and CEO since 2015 ▪ Joined SPX in 2008 – multiple leadership roles ▪ Led pre-spin Thermal segment ▪ Background: Milliken, Bain & Company, and Lazard Technology Partners ▪ B.S. Virginia Tech; MBA Dartmouth Gene Lowe President & Chief Executive Officer 2024 INVESTOR DAY
Slide 7: Company Overview
Company Overview 2023 Revenue by Geography (Destination) ▪ Headquartered in Charlotte, NC ▪ Focused, market-leading segments: » HVAC » Detection & Measurement ▪ $1.74B Revenue1 ▪ 4,000+ employees ▪ NYSE Ticker: SPXC 80% 12% 8% 1 2023 revenue A Leading Supplier of HVAC and Detection & Measurement Pro
Slide 8: The SPX Technologies Leadership Team
The SPX Technologies Leadership Team TODAY’S P RESENTERS ADDITIONAL TEAM MEMBERS Gene Lowe J. Randall “Randy” Data Darnell Smith Tausha White John urkin President & President, Chief Information Chief Human Resources General Counsel Chief Executive Officer Global Operations Officer Officer & Secretar
Slide 9: The SPX Technologies Board of Directors
The SPX Technologies Board of Directors LEFT TO Meenal Sethna, CFO of Littelfuse Rick Puckett, Retired CFO, Snyder’s-Lance Angel Shelton Willis, General Counsel, Sealed Air RIGHT David Roberts, Retired Executive Chairman Bob Toth, Former Chairman & CEO, Tana Utley, Retired VP of Large Power Systems,
Slide 10: SPX Transformation
SPX Transformation 2015-2021 ransformation 2021-2022 Transition 2023+ Acceleration ▪ Divested Power businesses ▪ Redeployed capital through M&A ▪ Driving continued MSD3 organic growth ▪ Focus on HVAC and D&M growth ▪ Commenced compounder strategy ▪ Significant inorganic opportunities ~$2.0B $1.7B $1
Slide 11: SPX: History
SPX: History 2015-2017 2018-2023 2024+ SPUN-OFF ACQUIRED SOLD OR ELIMINATED ACQUIRED SPX FLOW ▪ Schoenstedt ▪ ECS ▪ Transformer Solutions Ingénia ▪ CUES ▪ Sealite ▪ Legacy asbestos ▪ SGS ▪ Cincinnati Fan ▪ Legacy power projects SOLD ▪ Sabik ▪ ITL Global Dry Cooling ▪ Patterson-Kelley ▪ TAMCO Europea
Slide 12: SPX Products are Everywhere
SPX Products are Everywhere Detection & Measurement HVAC 5 6 6 8 4 7 7 5 1 1 D&M 4 HVAC 1 Precision Locator 1 Cooling Tower 2 Gas Line Robot 2 Hydronics 3 Wastewater Robot 2 3 Floor Heater 2 4 Spectrum Monitoring 4 Radiant Heater 3 5 Obstruction Lighting 5 Damper 6 Marine Lighting 3 6 Air Handling U
Slide 13: Strong Product Offerings and Attractive Market Dynamics
Strong Product Offerings and Attractive Market Dynamics 2023 Revenue from replacement sales1 Segment HVAC Revenue Margin ~2/3 ▪ Cooling Towers ▪ Electric Heating Revenue from #1 or #2 market position1 $1,122M 20.9% ▪ Engineered Air Movement 90% ▪ Hydronics MARLEY SGS REFRIGERATION CINCINNATI FAN TAM
Slide 14: What Defines Us?
What Defines Us? Engineered Leading Tech- Moats Sustainable Niches Positions Enabled Positioned Towards High-End of Value Chain 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 14 |
Slide 15: SPX Business System for Value Creation
SPX Business System for Value Creation Excellence Growth New Product Digital Development Continuous Commercial Improvement Excellence Talent Strategic M&A Disciplined Approach to Building Growth Platforms 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 15 |
Slide 16: Our Strategy Has Worked…
Our Strategy Has Worked… 1 1 Adj. EBITDA and Margin Adj. Earnings Per Share ($ M/%) ($/Share) $5.00 $390 $4.31 $310 ~20% $3.10 $207 18% $161 $2.33 14% 13% 2 2021 2022 2023 2024E 2 2021 2022 2023 2024E 1 Adjusted results are non-GAAP measures. Reconciliations from US GAAP financial measures are avail
Slide 17: …And Created Significant Value
…And Created Significant Value ~$5.3B +$4.8BMARKET CAP GROWTH 2024 $490M 2015 4 Divestitures 14 Acquisitions (~$700M REVENUE) (~$650M REVENUE1) 1 Based on annual revenue at the time of acquisition. ~10x Increase in Market Value of Equity 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 17 |
Slide 18: The Path Forward
The Path Forward Adjusted EBITDA1 ($ M) 2x+ New Product $310 Development Digital Commercial Continuous $390M Excellence Improvement Strategic Talent M&A 2023A Medium Term 1 Adjusted results are non-GAAP measures. Reconciliations of non-GAAP future measures to US GAAP financial measures are not pract
Slide 19: Value Creation Framework + New Targets
Value Creation Framework + New Targets Strong Foundation Business System Target Model Engineered Niches Leading Positions Excellence Growth 15%+ Adj. EBITDA1 Growth Tech-Enabled Digital Strategic M&A Moats Continuous Improvement New Product Development 20%+ Adj. EBITDA1 Margin Talent Commercial Sust
Slide 20: Balanced and Attractive End Markets
Balanced and Attractive End Markets 2024 Revenue1 Hospitality/Other 3% Office/Retail 5% Transportation 7% Data Center 7% Communications 5% Light Manufacturing 7% Water 6% Industrial Resi 21% 7% Lab & Healthcare 9% Government 6% Institutional 9% Energy & Utility 8% Non-Residential ndustrial Resi Smar
Slide 21: Sustainability that Creates Value in…
Sustainability that Creates Value in… …what we make… …and how we make it Lower Core Emissions Values Diversity & Safety Inclusion Clean Engagement Water Targeted Emissions Continuous Connectivity Reduction1 Improvement Clean Energy Minimize Waste 30% 1 Reduce Scope 1 and 2 GHG emissions intensity (r
Slide 22: What You Will Hear Today
What You Will Hear Today GOAL AMBITION 2x+ Adj. EBITDA1 Continue journey to be the next in medium term great industrial tech company Attractive Disciplined Inorganic Financial Core Growth Business System Growth Strategy 1 Non-GAAP measure Significant Opportunity to Continue Growth Journey 2024 INVES
Slide 24: Speaker Biography J. Randall (Randy) Data
Speaker Biography ▪ Joined SPX in 2015 ▪ Responsible for Business System and Global Operations ▪ Led multiple SPX businesses, acquisition integrations, divestitures, and exit from legacy South Africa projects ▪ Former: Babcock & Wilcox COO ▪ B.S. Engineering, Penn State; MBA Kent State J. Randall (R
Slide 25: SPX Business System Summary
SPX Business System Summary Create a culture of employee engagement, growth and improvement Attract, retain, develop the best talent Apply best practices related to digital, continuous improvement Smart sustainability program: create value for shareholders and employees Margin expansion (net of infl
Slide 26: Culture Drives Our Business
Culture Drives Our Business OUR MISSION What drives us Creating a Winning Culture at SPX that Drives OUR LEADERSHIP OUR VALUES Our Strategic Roadmap MODEL Who we are How we lead OUR VISION Where we are going 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 26 |
Slide 27: How We Operate, Grow and Improve
How We Operate, Grow and Improve BUSINESS SYSTEM SEGMENTS PLATFORMS Cooling HVAC Heating Excellence Growth Digital Strategic M&A Location & Inspection Continuous New Product Improvement Development Detection & AtoN Talent Commercial Measurement CommTech Excellence Transportation Strategic Planning &
Slide 28: The SPX Way
The SPX Way BUSINESS SYSTEM Improving Margins Excellence Growth Digital Strategic M&A Growing Revenue Continuous New Product Improvement Development Commercial Developing People Talent Excellence Strategic Planning & Goal Deployment 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 28 |
Slide 29: How We Drive Results
How We Drive Results Goal Deployment Model Strategy ▪ Framework to drive performance ▪ Strategic positioning for each business Performance Operating Objectives Plan ▪ Robust operating plans with key Excellence performance indicators established Growth ▪ KPIs centered on Growth, Excellence and Talent
Slide 30: Investing in Our Most Critical Asset … People
Investing in Our Most Critical Asset … People ▪ Ri represents how we deliver on our commitment to Reach, dentify, trengthen, and ngage our employees ▪ Enhances employee culture, leadership development, talent attraction, engagement and retention ▪ Helps clarify organizational needs, and the right ta
Slide 31: Digital … Making it Easy to Select SPX
Digital … Making it Easy to Select SPX Enterprise Digital Strategy Customer Best Shared Dedicated Experience Practices Infrastructure Resources CUSTOMER ENGAGEMENT PRODUCT CONFIGURATORS CONNECTED SOLUTIONS STRATEGIC INNOVATION Digital Sales & Empower Customer Data & onnected Leverage Platform Servic
Slide 32: Driving Margin through Continuous Improvement
Driving Margin through Continuous Improvement ▪ Relentless attention to training and continuous improvement culture ▪ Standard SPX way of Lean, management systems and problem solving ▪ Deep focus on strategic sourcing and inventory planning ▪ Investment in automation (skillsets and capital) ▪ Simpli
Slide 33: Connecting Sustainability with Continuous Improvement and New Product Development
Connecting Sustainability with Continuous Improvement and New Product Development …what we make… …and how we make it Lower Core Emissions Values Value-add for Customers Diversity & Safety Inclusion Imbed in Core Processes Clean Engagement Water Continuous Eliminate Waste Connectivity Improvement Cle
Slide 34: M&A Playbook … Managing Risk & Unlocking Value
M&A Playbook … Managing Risk & Unlocking Value Due Diligence Integration FUNCTIONAL EXPERTISE ▪ Target Identification DEFINED PROCESS & BUSINESS UNIT ▪ Business Continuity OWNERSHIP PLAYBOOK ▪ Strategic ▪ Strategic Objectives Assessment ▪ Deliver Synergies ▪ Data Validation & ▪ Fit for Purpose Hypot
Slide 35: Summary
Summary Culture is foundational to our success 19.8% 17.8% 14.2% Business system centered on excellence, growth and talent 13.2% 9.0% Disciplined goal deployment process drives results Smart sustainability aligned with continuous improvement 2 and new products 2016 2021 2022 2023 2024E 1 Adj. EBITDA
Slide 37: Speaker Biography Sean McClenaghan
Speaker Biography ▪ President of HVAC segment since 2024 ▪ Joined SPX in 2022 as President, Global Cooling ▪ Former: Reliance Worldwide Corp, DuPont, McKinsey, CHB Capital, and Egon Zehnder ▪ Bachelor, Chemical Engineering, Georgia Tech; MBA, Harvard Sean McClenaghan President, HVAC Segment 2024 INV
Slide 38: HVAC Summary
HVAC Summary Our products are all around you Focused on high value-add niches with moats Attractive and strengthening sector growth drivers Value drivers: growth, continuous improvement, digital, and M&A Clear path to significant growth in segment income 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECH
Slide 39: HVAC Segment Overview
HVAC Segment Overview 2023 Revenue by Product egment rowth ($ M) Medium-term Cooling Organic Targets 2023 Revenue $1.1B 61% ~60% $1,350 Replacement 5-6% Heating Revenue1 $1,122 39% $914 ~22% 21-25% 21% 15% 2023 Revenue by Geography 2022 2023 2024E 2 (destination) Revenue Segment income % 1 Managemen
Slide 40: SPX HVAC Products are Everywhere
SPX HVAC Products are Everywhere Air Handling Unit Duct Heater ritical xhaust Damper Cooling Tower Radiant Heat Floor Heater Hydronics Illustrative example. SPX’s HVAC products are used in a variety of end markets. 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 40 |
Slide 41: Attractive Fundamentals in HVAC
Attractive Fundamentals in HVAC Strong Diversified Favorable Sector Attributes End Markets Growth Trends Large addressable market Technology 4-5% Operationally critical applications Industrial Numerous specialty niches Institutional Substantial installed base Market CAGR1 Commercial Extensive afterm
Slide 42: Supported by Near-term Megatrends
Supported by Near-term Megatrends Electrification & Decarbonization Semiconductors ~50% Portion of industrial energy use having $39B Available subsidies for domestic high or medium potential for electrification semiconductor production in CHIPS Act AI Investments Reshoring ~2x Heat rejection require
Slide 43: Captured via High Value Applications
Captured via High Value Applications Critical MARLEY cooling towers help data centers operate at peak performance Niche STROBIC critical exhaust systems ensure laboratory fume hoods protect against hazardous inhalation exposure Engineered INDEECO heaters resolve challenging condensation issues for s
Slide 44: Resulting in Strong Competitive Positions
Resulting in Strong Competitive Positions Cooling Towers Electric Heating ▪ Invented cooling tower ▪ Specified applications ▪ Unmatched rep network ▪ Channel strength ▪ High certification standards ▪ Innovated category Air Movement Hydronics ▪ Highest quality ▪ Broadest range of boilers ▪ Speed and
Slide 45: Key Value Creation Drivers
Key Value Creation Drivers SPX BUSINESS SYSTEM Continuous Growth Digital Improvement perational Technology- Channel xcellence enabled Deepen partnerships Improve service Create enhanced customer with manufacturing reps and reduce cost productivity across value chain and specifying engineers Automati
Slide 46: Organic Growth – Channel Case Studies
Organic Growth – Channel Case Studies Application End Market Geographic Clean room ospital temperature Local market precision air quality and humidity access solutions solutions expansion Leverage TAMCO channel Leverage Marley channel Leverage Strobic and strength in custom AHUs1 strength in hospita
Slide 47: Organic Growth – New Product Development Case Studies
Organic Growth – New Product Development Case Studies Adiabatic Cooling WaterGard SVF Expansion Hybrid technology Significant water use Full-line offering balances water use reduction and cost provides ease of with energy efficiency savings installation OlympusV provides WaterGard pre-conditions Sta
Slide 48: Continuous Improvement – Operational Excellence Case Studies
Continuous Improvement – Operational Excellence Case Studies Cooling Plant Layout Heating Plant Process Contract Process Adjust line layout to Adjust line layout Accelerate contract increase throughput to reduce backlog and review process to and add flexibility improve lead times speed orders 30% in
Slide 49: Continuous Improvement – Automation Case Studies
Continuous Improvement – Automation Case Studies Primary Cooling Plant Engineered Air Plant Investment to increase capacity Investment to increase capacity with minimal labor addition with minimal labor addition ▪ Investment period 2022-2024 ▪ Investment period 2020-2024 ▪ Automation of metal fab an
Slide 50: Digital Case Studies
Digital Case Studies NURO® Controls CoolSpec ProTools SystM1 Intuitive interface Intuitive software to Contractor tools improve Best-in-class software designed to maximize compare and select installation and minimize moves seamlessly from boiler efficiency cooling systems costly truck rolls configur
Slide 51: M&A Case Studies
M&A Case Studies Engineered Air Movement 1 Electric Heat 2 Leading fans, blowers, and Leader in supplemental critical exhaust systems electric heat for commercial applications Industrial and commercial dampers and air control solutions High quality electric heating for industrial and High performanc
Slide 52: Acquisition Growth Strategy
Acquisition Growth Strategy New markets / products Inorganic Growth Vectors Adjacencies ▪ Engineered Air Movement ▪ Electric Heating Core consolidation ▪ Cooling Expansion 1 $1.35B Revenue Base 1 2024 midpoint guidance for HVAC segment revenue Active Pipeline; Multiple Opportunities 2024 INVESTOR DA
Slide 53: HVAC Summary and Conclusion
HVAC Summary and Conclusion High value product focus Attractive and strengthening markets Application of business system to drive organic growth and margin Significant room for further M&A growth Clear path to significant growth 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 53 |
Slide 55: Speaker Biography John Swann
Speaker Biography ▪ President of Detection & Measurement since 2022 ▪ Joined SPX in 2004 as Business Development leader ▪ Various leadership roles at SPX including President, HVAC Heating and Location & Inspection Platforms ▪ Former: PwC and Andersen Consulting ▪ B.A., Miami University; MBA, Kennesa
Slide 56: D&M Summary
D&M Summary Well-positioned, high value strategic growth platforms Serving specialized critical infrastructure applications Attractive end markets with secular tailwinds Accelerated growth through organic initiatives and M&A Proven track record of execution 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX T
Slide 57: Detection & Measurement Segment Overview
Detection & Measurement Segment Overview 2023 Revenue by Product Segment Growth ($ M) Medium-term Location & Inspection Equipment Organic Targets 2023 Revenue $619M 43% AtoN, CommTech, ~70% $619 $615 and Transportation Replacement 4-6% Revenue1 57% $547 21% ~21% 22-24% 19% 2023 Revenue by 2022 2023
Slide 58: SPX Detection & Measurement Segment
SPX Detection & Measurement Segment High value business platforms providing specialized field-deployed tools and technologies that enhance the safety, quality, productivity and performance of critical infrastructure systems Location & Inspection Aids to Navigation Communication Transportation Techno
Slide 59: SPX Products are Everywhere
SPX Products are Everywhere bstruction ighting Marine Lighting Spectrum Monitoring System Fare Collection System Precision Utility Locator Wastewater Robot Gas Line Robot 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 59 |
Slide 60: Attractive Secular Drivers and End Markets
Attractive Secular Drivers and End Markets Strong Attractive Favorable Secular Drivers End Markets Growth Trends Energy 3-5% Population Growth & Demographics Water Urbanization & Aging Infrastructure overnment Market CAGR1 Safety & Sustainability Communications Automation, Digital & AI Transportatio
Slide 61: Key Megatrends
Key Megatrends $30B ~50% Cost to industry annually from Obstruction lighting systems in US utility damages yet to be converted to LED 1.8M 40,000+ Miles of municipal wastewater and lateral Specific US infrastructure projects and pipe in US with average age of 45 years awards totaling $400B from 2021
Slide 62: How Does D&M Win?
How Does D&M Win? SPX BUSINESS SYSTEM Growth M&A Digital Strategic Market Platform Embedded Digital Expansion Accelerators Technologies ▪ Attractive end markets and adjacencies ▪ Proven compounder strategy ▪ Operator productivity ▪ High value customer segments ▪ Proprietary deal flow ▪ Predictive an
Slide 63: Case Studies – Strategic Market Expansion
Case Studies – Strategic Market Expansion Location & Inspection AtoN Portable Solar Integrated Offering AGL System Delivered buried utility asset Unique mobile airfield lighting location, inspection and solution allowing rapid assessment capabilities in a deployment for military and single customer
Slide 64: Case Studies – Innovation / New Product Development
Case Studies – Innovation / New Product Development ULC Robotics CISBOT 8200SG High Precision Technology Utility Locator Proprietary in-pipe robotic Radiodetection survey grade solution that prevents and (“ ”) technology combines repairs gas leaks without precision location with high interrupting ga
Slide 65: Case Studies – Embedded Digital
Case Studies – Embedded Digital CUES AI-Enabled CommTech 5G Spectrum Software Management GraniteNetTM is a condition ScorpioTM provides integrated assessment software platform hardware/software solution for for managing wastewater managing and monitoring a infrastructure wide range of RF networks Ut
Slide 66: M&A Case Studies Location & Inspection
M&A Case Studies Location & Inspection Leading electromagnetic locator brand Water / Wastewater pipeline inspection & remediation Specialized ferrous locators Gas pipeline inspection & remediation Leading GPR equipment $270M+ Solution provider for full lifecycle management of critical infrastructure
Slide 67: M&A Case Studies
M&A Case Studies Aids to Navigation Communication Technologies bstruction ighting Marine & Airfield Lighting Spectrum Monitoring and Terrestrial Airfield Ground COMINT Solutions Obstruction Lighting and Marine Obstruction Lighting Tactical Data Links and RF Bolt-on Terrestrial Marine Countermeasures
Slide 68: SPX Business System - D&M Synergies
SPX Business System - D&M Synergies ▪ Incubate & Accelerate New ▪ Cross-selling in key verticals Product Development ▪ Leverage existing channel partners ▪ Embedded AI/ML Development Digital / ▪ Utilization of SPX Channel Toolkit Commercial ▪ Cloud/SaaS Development Engineering ▪ Lean/CI and 80-20 to
Slide 69: D&M Summary & Conclusion
D&M Summary & Conclusion Well-positioned, high value strategic growth platforms Serving specialized critical infrastructure applications Attractive end markets with secular tailwinds Accelerated growth through organic initiatives and M&A Proven track record of execution 2024 INVESTOR DAY | COPYRIGHT
Slide 71: Speaker Biography Michael Daly
Speaker Biography ▪ VP, Strategy and Business Development ▪ Joined SPX in fall of 2022 ▪ Two decades of global M&A leadership experience across diverse industries ▪ Former: Honeywell, Caesars Entertainment, GE Capital and General Electric ▪ B.S., University of Vermont Michael Daly VP, Strategy & Bus
Slide 72: Executive Summary
Executive Summary 14 deals since spin $1.6B capital deployed to M&A Successfully repositioned portfolio Building platforms of scale across entire company Demonstrated ability to complete larger transactions Active M&A program with healthy pipeline 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIE
Slide 73: M&A Track Record
M&A Track Record (Revenue1 in $ M) HVAC Segment Detection & Measurement Segment ~$850 ~$500 ~$270 ~$345 Heating Cooling L&I AtoN CommTech Transport 1 2024 guidance midpoint model Building “Platforms of Scale” 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 73 |
Slide 74: Key Performance Metrics
Key Performance Metrics 1.5-2.0x 1 $1.6B $113M typical purchase capital deployed average price multiple since 2018 deal size reduction through synergies ~$650M 8x-12x $8B+ acquired revenue typical Adj. EBITDA2 increase in and 20%+ Adj. purchase addressable EBITDA2 price market margin multiples 1 Ant
Slide 75: Inorganic Growth Progression
Inorganic Growth Progression 2018-2022 Last 12 Months $739M $843M Capital Deployed Capital Deployed $67M $281M Avg Deal Size Avg Deal Size Demonstrated Larger Deal Capabilities Unlocking Addressable Markets 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 75 |
Slide 76: What Makes a Good SPX M&A Target?
What Makes a Good SPX M&A Target? Strategic Framework Focus Areas Assessment Criteria ✓ Sizable TAM Engineered Niches Leading Positions HVAC ✓ Less-Cyclical ✓ Attractive Growth & Tech-Enabled Margin Opportunities Moats D&M ✓ Achievable Synergies Sustainable ✓ Cash ROIC > WACC 2024 INVESTOR DAY | COP
Slide 77: M&A Operations: Planning & Execution
M&A “Operations”: Planning & Execution OUTREACH Annual ▪ Team Sport… Distributed Calling Strategic M&A ▪ Outreach with Deep Relationships Plan Game- board M&A DEAL EXECUTION Planning ▪ Track Record… “Buyer of Choice” ▪ Dedicated Resources & Processes INTEGRATION ▪ Critical to Success Competitive Lan
Slide 78: Ample Room for Growth
Ample Room for Growth HVAC D&M Product ew Business Adjacency Addition / Extension reation Core NEW Addressable $11B+ $4B+ New Products Adjacent Markets using Market1 PRODUCTS for Growth in Existing Markets ew Products ▪ L&I, AtoN, Inorganic ▪ EAM, Electric Heat & CommTech & Core Focus Cooling Expans
Slide 79: M&A Playbook … Managing Risk & Unlocking Value
M&A Playbook … Managing Risk & Unlocking Value Due Diligence ntegration FU A XP R ▪ Target Identification DEFINED PROCESS & BUSINESS UNIT ▪ Business Continuity OWNERSHIP PLAYBOOK ▪ Strategic ▪ Strategic Objectives Assessment ▪ Deliver Synergies ▪ Data Validation & ▪ Fit for Purpose Hypothesis Testin
Slide 80: Wrap-Up
Wrap-Up Objectives Keys to Success ▪ M&A as key enabler of SPX value ▪ Strategy as North Star creation framework ▪ Continued outreach & origination to “make” ▪ Capitalize on opportunity to be next deals… remain buyer of choice compounder ▪ Best-in-class execution: speed & quality ▪ “Sweet-Spot” $50-
Slide 82: Speaker Biography Mark A. Carano
Speaker Biography ▪ CFO and Treasurer ▪ Joined SPX in early 2023 ▪ Extensive background in finance, accounting, strategy, and business development ▪ Former: Insteel Industries, Big River Steel and Babcock & Wilcox, and significant investment banking experience ▪ B.A., Vanderbilt; MBA, Northwestern M
Slide 83: SPX Technologies at a Glance
SPX Technologies at a Glance1 ~$1.97B ~$390M ~20% ~$5.00 FY 2024E FY 2024E FY 2024E FY 2024E Revenue Adj. EBITDA Adj. EBITDA Margin Adj. EPS APAC 8% EMEA D&M 12% 31% Diverse end markets Revenue Mandated / spec-driven markets Revenue by by Segment Strong market leadership Geography (Destination) VA H
Slide 84: Financial Transformation of SPX Technologies…
Financial Transformation of SPX Technologies… Repositioning the Legacy Business ... ... into a Premier Industrial Technology Company ▪ Repositioning ($ M) 2016 2021 2024E2 » Exited power market through divestitures 1 » 14 acquisitions in higher growth and margin end markets Revenue $1,389 $1,220 $1,
Slide 85: …Resulting in Market Leading Value Creation
…Resulting in Market Leading Value Creation Acquisition ngénia Divestiture/Other Patterson- ensors & Share Repurchase Schonstedt Sabik Kelley oftware ECS ITL ASPEQ Share Price Cincinnati Appreciation: CUES SGS ULC Sealite TAMCO Fan 882% S&P 500: 172% Market Cap Share Repurchase Valuation: ~$5.3B Asb
Slide 86: Well-Positioned to Deliver on Strategic Initiatives
Well-Positioned to Deliver on Strategic Initiatives Proven track record of delivering strong financial results Strong balance sheet and cash flow generation support growth objectives Disciplined capital allocation focused on generating long-term shareholder value Achievable growth targets through co
Slide 87: Strong Top Line Momentum
Strong Top Line1 Momentum HVAC ($ M) SPX $1,965 $1,350 ($ M) $1,122 $1,741 $914 $752 $1,461 $1,220 2021 2022 2023 2024E 2 D&M ($ M) $547 $619 $615 $467 2021 2022 2023 2024E 2 2021 2022 2023 2024E 2 1 Revenue 2 2024 figures reflect the midpoint of our guidance range. 2024 INVESTOR DAY | COPYRIGHT © 2
Slide 88: Margin Expansion via Business System and Acquisitions
Margin Expansion via Business System and Acquisitions HVAC Segment Income and Margin ($ M/%) ~$294 ▪ Substantial margin growth realized largely through scale, $234 operational initiatives, and accretive acquisitions $136 21% ~22% ▪ Structurally raised margins above 20% $108 14% 15% ▪ Targeting 21-25
Slide 89: Leveraging Through to the Bottom Line
Leveraging Through to the Bottom Line Adj. EBITDA and Margin1 Adj. Earnings Per Share 1 ($ M/%) ($/Share) $390 $5.00 $4.31 $310 $3.10 $207 ~20% $2.33 $161 17.8% 14.2% 13.2% 2 2 2021 2022 2023 2024E 2021 2022 2023 2024E Adj. Corp1 Expense 4.3% 3.4% 2.9% 2.4% (% of revenue) 1 Adjusted results are non-
Slide 90: Free Cash Flow Generation Enables Growth Strategy
Free Cash Flow Generation Enables Growth Strategy Adj. Free Cash Flow1 Conversion (% of Adj. Net Income1) 95% 95-100% Solid Adj. Free Cash Flow2 Performance ~90% ▪ Target 95-100% conversion of adj. net income2 ▪ Focused working capital optimization ▪ Return-driven CapEx investments to facilitate gro
Slide 91: Disciplined Balance Sheet Utilization
Disciplined Balance Sheet Utilization Net Leverage1 Target Range: 1.5-2.5x Efficiently operate within target range 2.5x 2.1x of 1.5-2.5x 2.0x 1.7x 1.6x 1.7x 1.5x Return-driven capital 0.4x deployment Strong free cash flow Transformers divestiture generation -0.9x Year-end 2015 2016 2017 2018 2019 20
Slide 92: Growth-Oriented Capital Allocation
Growth-Oriented Capital Allocation Capital Deployed 2021-2024E1 Strategic Acquisitions 90% Priorities ▪ Strategic acquisitions ~$1.3B ▪ Return-driven CapEx investments to facilitate organic growth Return of ▪ Opportunistic return of capital to Capital 3% shareholders CapEx 7% 1 Assumes $40M of CapEx
Slide 93: Proven Strategy to Create Long-Term Shareholder Value
Proven Strategy to Create Long-Term Shareholder Value ▪ MSD organic growth Revenue » Accelerate with acquisitions ▪ 15%+ CAGR » Operating leverage on organic growth Adj. EBITDA1 » Business system offsets inflation » Enhance through acquisition synergies ▪ 95-100% target conversion Adj. Free Cash Flo
Slide 94: EBITDA Growth Framework
EBITDA Growth Framework 1 Adj. EBITDA ($ M) 2x+ Acquired EBITDA, ▪ Business System (+) enhanced through ▪ Price/Cost (neutral) synergies ▪ Inflation (-) $310 Operating leverage on organic growth 20%+ Adj. EBITDA margin; 15%+ Adj. EBITDA CAGR 2023 Organic Inorganic Medium Term 1 Adjusted results are
Slide 95: Summary
Summary Proven track record of delivering strong financial results Disciplined capital allocation focused on generating long-term shareholder value Strong balance sheet and cash flow generation support M&A growth objectives Achievable growth targets through continued execution of compounder strategy
Slide 97: Summary & Conclusion
Summary & Conclusion Solid base of attractive growth businesses Successful and effective growth and capital deployment Significant further Business System and continuous improvement opportunities Large M&A pipeline with strong execution capabilities Strong cash generation and disciplined balance she
Slide 100: FY 2023 U.S. GAAP to Adjusted EPS Reconciliation
FY 2023 U.S. GAAP to Adjusted EPS Reconciliation ($ M) GAAP Adjustments Adjusted Segment income $ 353.2 $ — $ 353.2 Corporate expense (1) (58.4) 8.1 (50.3) Acquisition-related and other costs (2) (5.8) 5.8 — Long-term incentive compensation expense (13.4) — (13.4) Amortization of acquired intangible
Slide 101: FY 2022 U.S. GAAP to Adjusted EPS Reconciliation
FY 2022 U.S. GAAP to Adjusted EPS Reconciliation ($ M) GAAP Adjustments Adjusted Segment income $ 249.6 $ — $ 249.6 Corporate expense (1) (68.6) 18.2 (50.4) Acquisition-related and other costs (2) (1.9) 1.9 — Long-term incentive compensation expense (3) (10.9) (0.8) (11.7) Amortization of acquired i
Slide 102: FY 2021 U.S. GAAP to Adjusted EPS Reconciliation
FY 2021 U.S. GAAP to Adjusted EPS Reconciliation ($ M) GAAP Adjustments Adjusted Segment income $ 200.6 $ — $ 200.6 Corporate expense (1) (60.5) 8.6 (51.9) Acquisition related and other costs (2) (5.1) 5.1 — Long-term incentive compensation expense (12.8) — (12.8) Amortization of intangible assets (
Slide 103: FY 2016 U.S. GAAP to Adjusted EPS Reconciliation
FY 2016 U.S. GAAP to Adjusted EPS Reconciliation ($ M) GAAP Adjustments Adjusted Segment income (1) $ 142.8 $ 14.5 $ 157.3 Corporate expense (41.7) — (41.7) Pension and postretirement income (expense)(2) (15.4) 16.0 0.6 Long-term incentive compensation expense (13.7) — (13.7) Special charges, net (5
Slide 104: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation ($ M) 2016 2021 2022 2023 FY FY FY FY Net income (loss) $ (67.6) $ 425.4 $ 0.2 $ 89.9 Exclude: Income tax provision (9.1) (10.9) (7.3) (41.6) Interest expense, net (14.0) (12.6) (7.6) (25.5) Amortization expense (1) (2.8) (21.6) (28.6) (44.0) Depreciation expense (23.7
Slide 105: 2021-2023 Adjusted FCF Reconciliation
2021-2023 Adjusted FCF Reconciliation ($ M) FY 2021 FY 2022 FY 2023 Operating cash flow from (used in) continuing operations $ 131.2 $ (115.2) $ 243.8 Capital expenditures (9.6) (15.9) (23.9) Free cash flow from (used in) continuing operations 121.6 (131.1) 219.9 Adjustments* (18.1) 228.1 10.2 Adjus
Slide 106: 2016 Revenue Reconciliation
2016 Revenue Reconciliation ($ M) Full Year 2016 Revenue South Africa GAAP Projects Adjusted HVAC 509.5 - 509.5 D&M 226.4 - 226.4 Engineered Solutions 736.4 (83.3) 653.1 Total SPX $ 1,472.3 (83.3) $ 1,389.0 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 106 |
Slide 107: 2015 Revenue Reconciliation
2015 Revenue Reconciliation ($ M) Full Year 2015 Revenue South Africa GAAP Projects Adjusted HVAC 529.1 529.1 D&M 232.3 232.3 Power 957.9 (27.3) 930.6 Total SPX $ 1,719.3 (27.3) $ 1,692.0 2024 INVESTOR DAY | COPYRIGHT © 2024 SPX TECHNOLOGIES 107 |

SPX Technologies — Investor Day (March 2024) on 6ix

Spx Technologies — Investor Day (March 2024)

Slide 1: 2024 Investor Day

Slide 2: Safe Harbor Statement

Slide 3: Welcome and Introductions

Slide 4: Agenda Summary

Slide 5: SPX Technologies: Past, Present & Future

Slide 6: Speaker Biography Gene Lowe

Slide 7: Company Overview

Slide 8: The SPX Technologies Leadership Team

Slide 9: The SPX Technologies Board of Directors

Slide 10: SPX Transformation

Slide 11: SPX: History

Slide 12: SPX Products are Everywhere

Slide 13: Strong Product Offerings and Attractive Market Dynamics

Slide 14: What Defines Us?

Slide 15: SPX Business System for Value Creation

Slide 16: Our Strategy Has Worked…

Slide 17: …And Created Significant Value

Slide 18: The Path Forward

Slide 19: Value Creation Framework + New Targets

Slide 20: Balanced and Attractive End Markets

Slide 21: Sustainability that Creates Value in…

Slide 22: What You Will Hear Today

Slide 23: Business System

Slide 24: Speaker Biography J. Randall (Randy) Data

Slide 25: SPX Business System Summary

Slide 26: Culture Drives Our Business

Slide 27: How We Operate, Grow and Improve

Slide 28: The SPX Way

Slide 29: How We Drive Results

Slide 30: Investing in Our Most Critical Asset … People

Slide 31: Digital … Making it Easy to Select SPX

Slide 32: Driving Margin through Continuous Improvement

Slide 33: Connecting Sustainability with Continuous Improvement and New Product Development

Slide 34: M&A Playbook … Managing Risk & Unlocking Value

Slide 35: Summary

Slide 36: HVAC Growth Strategy

Slide 37: Speaker Biography Sean McClenaghan

Slide 38: HVAC Summary

Slide 39: HVAC Segment Overview

Slide 40: SPX HVAC Products are Everywhere

Slide 41: Attractive Fundamentals in HVAC

Slide 42: Supported by Near-term Megatrends

Slide 43: Captured via High Value Applications

Slide 44: Resulting in Strong Competitive Positions

Slide 45: Key Value Creation Drivers

Slide 46: Organic Growth – Channel Case Studies

Slide 47: Organic Growth – New Product Development Case Studies

Slide 48: Continuous Improvement – Operational Excellence Case Studies

Slide 49: Continuous Improvement – Automation Case Studies

Slide 50: Digital Case Studies

Slide 51: M&A Case Studies

Slide 52: Acquisition Growth Strategy

Slide 53: HVAC Summary and Conclusion

Slide 54: D&M Growth Strategy

Slide 55: Speaker Biography John Swann

Slide 56: D&M Summary

Slide 57: Detection & Measurement Segment Overview

Slide 58: SPX Detection & Measurement Segment

Slide 59: SPX Products are Everywhere

Slide 60: Attractive Secular Drivers and End Markets

Slide 61: Key Megatrends

Slide 62: How Does D&M Win?

Slide 63: Case Studies – Strategic Market Expansion

Slide 64: Case Studies – Innovation / New Product Development

Slide 65: Case Studies – Embedded Digital

Slide 66: M&A Case Studies Location & Inspection

Slide 67: M&A Case Studies

Slide 68: SPX Business System - D&M Synergies

Slide 69: D&M Summary & Conclusion

Slide 70: Strategy and M&A

Slide 71: Speaker Biography Michael Daly

Slide 72: Executive Summary

Slide 73: M&A Track Record

Slide 74: Key Performance Metrics

Slide 75: Inorganic Growth Progression

Slide 76: What Makes a Good SPX M&A Target?

Slide 77: M&A Operations: Planning & Execution

Slide 78: Ample Room for Growth

Slide 79: M&A Playbook … Managing Risk & Unlocking Value