Slide 1: Earnings Conference Call Q4 and Full Year 2021
Earnings Conference Call Q4 and Full Year 2021
Slide 2: Forward-Looking Statements
Brunswick Corporation - Earnings Release Forward-Looking Statements Certain statements in this presentation are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations, estimates, and projections abou
Slide 3: Use of Non-GAAP Financial Information and Constant Currency Reporting
Brunswick Corporation – Earnings Release Use of Non-GAAP Financial Information and Constant Currency Reporting In this presentation, Brunswick uses certain non-GAAP financial measures, which are numerical measures of a registrant’s historical or future financial performance, financial position or ca
Slide 4: Business Overview
BUSINESS OVERVIEW Dave Foulkes - CEO |4 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 5: 2021 in Review
Brunswick Corporation – 2021 in Review Outstanding Performance Across the Company Record full year Top-line growth across all U.S. marine retail unit FY 2022 guidance: results: businesses: demand is strong, but • Net Sales of $6.7B - $7.0B • Adjusted EPS of $8.28 (up 1 • Significant Mercury market s
Slide 6: Ripl Community – 2021 Boating Season Survey
Brunswick Corporation – Earnings Release Ripl Community – 2021 Boating Season Survey “New” boaters are expected to stay in boating for the long-term 93% 90% First time boat buyers expect they will CONTINUE Boat buyers from 2020 rated their SECOND TO OWN A BOAT 5 YEARS FROM NOW BOATING SEASON AS 4 OR
Slide 7: Each Segment Contributed to Outstanding 2021 Performance
Brunswick Corporation – Earnings Release Each Segment Contributed to Outstanding 2021 Performance PROPULSION PA R T S & B O AT S & B U S I N E S S ACCESSORIES A C C E L E R AT I O N • Retail market share gains continue; • Strong sales growth across all • Full-year 2021 unit production at U.S. outboa
Slide 8: Full Year Revenue Growth Rates and Mix By Region
Brunswick Corporation – Earnings Release International sales Full Year Revenue Growth Rates and Mix By Region 1 up 30 percent on a constant currency basis, excluding Canada Europe acquisitions Growth +59% Growth +32% Mix: 7% Mix: 13% All segments Asia- experienced Pacific significant U.S. Growth
Slide 9: U.S. Powerboat Industry – Percentage Change in Retail Units
Brunswick Corporation – Earnings Release U.S. Powerboat Industry – Percentage Change in Retail Units U.S. main powerboat retail unit FY 2021 vs FY: FY 2021 VS FY FY CATEGORY 2020 2019 2020: -7% FY 2020 FY 2019 2019: +8% Outboard Boats (6)% 9% 14% (3)% Brunswick brands’ Fiberglass SD/IB Boats
Slide 10: Pricing Actions and Inflation Impacts on Operating Margins
Brunswick Corporation – Earnings Release Pricing Actions and Inflation Impacts on Operating Margins 0.5% Operating Margin 0.4% Impact* 0.3% 0.2% 0.1% 0.0% Oct'21-FY Fcst FY'21-Act FY 2022 Includes full year impact of 2021 price increase actions across all segments PRICING Implemented certain mid
Slide 11: Capital Strategy Update
Brunswick Corporation – Earnings Release Capital Strategy Update $368M $128M 1.8x $120M Cash and Debt Gross Share Marketable retired leverage repurchases Securities $321M $267M +24% $1.2B Free Cash Flow 1 Capital Increased annual Completed 9 deployed dividend to $1.34 acquisitions We successfully ex
Slide 12: Financial Overview
FINANCIAL OVERVIEW Ryan Gwillim – CFO | 12 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 13: Overview of Fourth Quarter 2021 Adjusted Results
Brunswick Corporation – Earnings Release Overview of Fourth Quarter 2021 Adjusted Results1 NET SALES ($m) OPERATING EARNINGS1 ($m) $1,431 $156 $146 $1,161 +23% +7% $918 +59% +27% $92 Q4 2021 was the sixth consecutive quarter with OPERATING MARGIN1 % DILUTED EPS1 record EPS 12.5% 10.9% $1.44 10.0%
Slide 14: Overview of Full-Year 2021 Adjusted Results
Brunswick Corporation – Earnings Release Overview of Full-Year 2021 Adjusted Results1 NET SALES ($m) OPERATING EARNINGS1 ($m) $887 $5,846 +53% $4,348 +34% $4,109 $579 $532 +6% +9% Operating Leverage: 20.5% vs. 2020 OPERATING MARGIN1 % DILUTED EPS1 20.4% vs. 2019 15.2% $8.28 +190 bps +63% $5.07
Slide 15: Propulsion Segment – Q4 Performance
Brunswick Corporation – Earnings Release Propulsion Segment – Q4 Performance % CHANGE VS PRODUCT CATEGORY SALES ($M) 2020 2019 Outboard Engines $450.2 15% 53% Sterndrive Engines $46.8 7% 17% Controls, Rigging and Propellers $73.5 4% 57% Total $570.5 12% 49% OPERATING MARGIN OPERATING EARNINGS • Oper
Slide 16: Parts & Accessories Segment – Q4 Performance
Brunswick Corporation – Earnings Release Parts & Accessories Segment – Q4 Performance1 % CHANGE VS PRODUCT CATEGORY SALES ($M) 2020 2019 Engine Parts and Accessories $108.6 4% 41% Distribution $148.6 1% 28% Advanced Systems Group $125.6 15% 39% Navico $122.8 N/A N/A Total $505.6 40% 78% OPERATING MA
Slide 17: Boat Segment – Q4 Performance
Brunswick Corporation – Earnings Release Boat Segment – Q4 Performance1 % CHANGE VS PRODUCT CATEGORY SALES ($M) 2020 2019 Aluminum Freshwater $177.0 19% 42% Recreational Fiberglass $146.1 17% 36% Saltwater Fishing $95.7 (2)% 24% Business Acceleration $16.5 50% 90% Total $433.02 14% 37% OPERATING MAR
Slide 18: Pipeline Metrics
Brunswick Corporation – Earnings Release Pipeline Metrics UNITS IN PIPELINE ENDING WEEKS ON HAND (in thousands) 30 50 25 40 20 -20% 30 15 20 15.4 10 10 5 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2018 2019 2020 2021 2018 2019 2020 2021 Expect 2022 WOH to follow a similar trajectory Sold ~8,300 units at wholesale
Slide 19: Assumptions and Guidance for 2022
Brunswick Corporation – Earnings Release Assumptions and Guidance for 2022* 1 2 3 4 5 6 U.S. marine Revenue Operating EPS FCF in Q1 revenue industry retail unit between margin growth between EXCESS OF UP ~15% vs growth remains $6.7B AND between 20 AND $9.60 - $350 MILLION Q1 2021, with supply $7.0B
Slide 20: 2022 Outlook – Segment Guidance
Brunswick Corporation – Earnings Release 2022 Outlook – Segment Guidance Parts & Propulsion Accessories Boat NET SALES UP LOW-DOUBLE UP HIGH-TWENTIES UP LOW-DOUBLE GROWTH DIGIT PERCENT PERCENT DIGIT PERCENT O P E R AT I N G FLAT TO UP FLAT TO UP 10.0+ PERCENT MARGIN 30 BPS 30 BPS TA R G E T * | 20 *
Slide 21: 2022 Outlook – P&L and Cash Flow Assumptions
Brunswick Corporation – Earnings Release 2022 Outlook – P&L and Cash Flow Assumptions Working ~$140 – $180 Effective Book APPROXIMATELY Capital Usage MILLION Tax Rate 22% Depreciation & ~$160 – $170 Effective Cash HIGH-TEENS Amortization1 MILLION Tax Rate PERCENT Acquisition Average Diluted ~77.0 –
Slide 22: 2022 Outlook – Capital Strategy and Other Assumptions
Brunswick Corporation – Earnings Release 2022 Outlook – Capital Strategy and Other Assumptions Capital Share Expenditures ~$375 – $425 MILLION ~$100 – $150 MILLION Repurchases Debt Quarterly Retirement ~$100 MILLION Dividends $0.335 PER SHARE Net Interest Tariff Earnings Expense ~$70 MILLION ~$65 MI
Slide 23: Outlook
OUTLOOK Dave Foulkes – CEO | 23 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 24: Operating and Strategic Priorities
Brunswick Corporation – Earnings Release Operating and Strategic Priorities BOATS & PARTS & PROPULSION BUSINESS ENTERPRISE ACCESSORIES ACCELERATION • Continue global share • Optimize global operating • Focus on operational • Accelerate Brunswick-wide growth, especially in model and distribution exce
Slide 25: Recent ACES, Sustainability, Expansions and M&A Highlights
Brunswick Corporation – Earnings Release Recent ACES, Sustainability, Expansions and M&A Highlights New Product Launches Support Signed Virtual Power Purchase Virtual participation in CES 2022 Intuitive Boating Experiences for all Agreement Reynosa manufacturing expansion Mercury Marine to open purp
Slide 26: Recognized for Excellence in 2021
Brunswick Corporation – Earnings Release Recognized for Excellence in 2021 AVERAGED MORE THAN ONE MAJOR AWARD PER WEEK IN 2021 | 26 ©2022 Brunswick Co. Confidential and all rights reserved.
Slide 27: Brunswick's Virtual Investor Day 2022 | March 7
BRUNSWICK’S VIRTUAL INVESTOR DAY 2022 | MARCH 7 | 27 ©2020 Brunswick Co. Confidential and all rights reserved.
Slide 28: Appendix
Appendix | 28
Slide 29: GAAP to Non-GAAP Reconciliations – Q4
Brunswick Corporation – Earnings Release GAAP to Non-GAAP Reconciliations – Q4 Operating Earnings Diluted Earnings per Share (in millions, except per share data) Q4 2021 Q4 2020 Q4 2021 Q4 2020 GAAP $121.8 $136.5 $1.31 $1.22 Restructuring, exit and impairment charges 0.1 (0.2) — — Purchase accountin
Slide 30: GAAP to Non-GAAP Reconciliations - FY
Brunswick Corporation – Earnings Release GAAP to Non-GAAP Reconciliations - FY Operating Earnings Diluted Earnings per Share (in millions, except per share data) FY 2021 FY 2020 FY 2021 FY 2020 GAAP $812.9 $539.3 $7.59 $4.70 Restructuring, exit and impairment charges 0.8 4.1 0.01 0.04 Purchase accou
Slide 31: Q4 Net Sales increased by $269.9 million, or 23.2 percent
Brunswick Corporation – Earnings Release Q4 Net Sales increased by $269.9 million, or 23.2 percent Segments Q4 2021 Q4 2020 % Change Propulsion $570.5 $507.9 12.3% Parts & Accessories 505.6 360.8 40.1% Boat 433.0 380.8 13.7% Segment Eliminations (78.1) (88.4) Total $1,431.0 $1,161.1 23.2% Q4 2021 Co
Slide 32: FY Net Sales increased by $1,498.7 million, or 34.5 percent
Brunswick Corporation – Earnings Release FY Net Sales increased by $1,498.7 million, or 34.5 percent Segments FY 2021 FY 2020 % Change Propulsion $2,504.7 $1,878.4 33.3% Parts & Accessories 2,008.1 1,508.8 33.1% Boat 1,703.1 1,250.3 36.2% Segment Eliminations (369.7) (290.0) Total $5,846.2 $4,347.5
Slide 33: Q4 2021 vs. Q4 2020 Sales Growth Drivers
Brunswick Corporation – Earnings Release Q4 2021 vs. Q4 2020 Sales Growth Drivers Parts & Propulsion Accessories Boat Brunswick US - Organic 14% 0% 10% 11% International - Organic 10% 11% 24% 14% Total Organic 12% 4% 13% 12% Acquisitions - 36% 1% 11% Currency (0%) (0%) 0% (0%) 2021 Net Sales - GAAP
Slide 34: FY 2021 vs. FY 2020 Sales Growth Drivers
Brunswick Corporation – Earnings Release FY 2021 vs. FY 2020 Sales Growth Drivers Parts & Propulsion Accessories Boat Brunswick US - Organic 36% 19% 31% 29% International - Organic 23% 30% 46% 30% Total Organic 31% 22% 35% 30% Acquisitions - 9% 0% 3% Currency 2% 2% 1% 1% 2021 Net Sales - GAAP 33% 33
Slide 35: Tax Provision
Brunswick Corporation – Earnings Release Tax Provision Q4 2021 Q4 2020 Estimated 2022 Effective Tax Rate - GAAP (0.4%) 19.4% effective book tax Effective Tax Rate - As Adjusted 1 17.3% 19.0% rate, as adjusted, is expected to be approximately 22 percent based on tax guidance FY 2021 FY 2020 issued
Slide 36: Free Cash Flow – Full Year
Brunswick Corporation – Earnings Release Free Cash Flow – Full Year (in millions) FY 2021 FY 2020 Net cash provided by operating activities from $586.2 $800.0 continuing operations Net cash (used for) provided by: Capital expenditures (267.1) (182.4) Proceeds from sale of property, plant, equipment