Slide 1: 2012 First Quarter Earnings Conference Call
REGAL 2012 - First Quarter Earnings Conference Call May 2, 2012 Mark Gliebe Jon Schlemmer Chuck Hinrichs John Perino Oraman sna Bhet Operaing Ohio ee siert ce Presdert Chie Execute Office Chet Finanetl Officer InvestorRelatione
Slide 2: Safe Harbor Statement
REGAL Safe Harbor Statement This presentation contains "forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent our management's judgment regarding future events. In many cases, you can identify forward-looking statements b
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures We prepare financial statements in accordance with accounting principles generally accepted in the United States (GAAP). We also disclose adjusted diluted earnings per share (EPS), adjusted gross profit, adjusted gross profit as a percentage of net sales, free cash flow a
Slide 4: Opening Comments
Opening Comments Financial Update Operations Update Summary Q&A Closing Comments Mark Gliebe Chuck Hinrichs Jon Schlemmer Mark Gliebe All Mark Gliebe p4
Slide 5: Opening Comments
Opening Comments + First Quarter Results Met Expectations * Record First Quarter Revenue and Net Income — Strengths: Performance of C&l, Mechanical, and Unico — Challenges: Residential HVAC and Asia Demand * Other Recent Highlights — Seventh Dividend Increase in the Last Eight Years — Acquisition of
Slide 6: 1st Quarter 2012 Results
1st Quarter 2012 Results * Sales Growth of 21.9% vs. 1Q 2011 Reflects — Inclusion of EPC and Milwaukee Gear Sales — Growth in N.A. C&l, Mechanical and Unico — Offsetting Weakness in HVAC and China * SG&A Includes $1.3 Million ($0.02 EPS) Gain on Sale of Property + Income Tax Expense Included $1.4 Mi
Slide 7: First Quarter 2012 Financial Highlights
First Quarter 2012 Financial Highlights $808 a al $1.16 SS $64 | $0.99 | 2011 2012 2011 2012 2011 2012 Revenue ($M) Operating Income ($M) Diluted EPS p7
Slide 8: Financial Highlights
Financial Highlights Capital Expenditures Income Tax Rate * $20 Million in 1Q 2012 * 26.3% ETR in 1Q 2012 * $110 Million Est. for 2012 * 29% - 30% ETR Est. for 2012 Free Cash Flow Balance Sheet * $49 Million FCF in 1Q 2012 * Total Debt of $986M * 100% of Net Income — Milwaukee Gear Acquisition * Deb
Slide 9: Second Quarter 2012 Guidance
Second Quarter 2012 Guidance EPS Guidance of $1.42 to $1.48 . Seasonal Businesses Experiencing Typical Growth Strength Expected in C&l, Mechanical, Unico Partially Offsetting Weakness in HVAC and China Milwaukee Gear Contributing to Earnings Integration Activities for EPC Synergies Underway, Restruc
Slide 10: Operations Update
Operations Update + First Quarter Overview —C&I Showed 7.0% Sales Growth — Mechanical Business in North America Showed 8.7% Sales Growth —Unico Showed 46% Sales Growth —Difficult Residential HVAC Environment * Sales Outside US Increased 13%, Representing 34% of Total Sales —Acquisitions Adding to Ou
Slide 11: New China Facilities
| recar Y New China Facilities ) New Hermetic Motor Plant r * Taicang China + Factory Construction Complete + Installing First Equipment : i eae — New Generator Plant + Shanghai China * Factory Construction Nearing Completion pt
Slide 12: New Products
New Products * Sales of Energy Efficient Products Represented 18% of Total Sales * Continue to Develop New Products With a Focus on Energy and Energy Efficiency MILWAUKEE GEAR Zw 20: \V-Green: \3 rat | a p12
Slide 13: High Efficiency Vertical Pump Motor
High Efficiency Vertical Pump Motor * High Efficiency Pump Design New High Efficiency Vertical Pump Motor * Common Applications Include — Irrigation — Water Treatment Plants — Marine — Cooling Towers * Typical Payback Less Than 2 Years p13
Slide 14: Oil & Gas Generator
Oil & Gas Generator New Generator for Oil & Gas Applications + Electronic Monitoring Equipment Used to Increase Well Production + Electrical Power Needed at Remote Sites - Designed to Meet Strict Safety and Certification Requirements p14
Slide 15: Simplification Progress
Simplification Progress ¢ Restructuring in Europe, Australia and Juarez Proceeding * Supply Chain Alignment and Optimization * ERP Conversions and Consolidation » 4h Executive Leadership Program Investing in Our Future pis
Slide 16: Summary
REGAL Summary * Business Diversity Delivers Results in First Quarter * Simplification and Synergies Continue to Deliver Value ¢ Benefits of Milwaukee Gear Acquisition « Second Quarter Guidance Includes Continued Weakness in HVAC and China Sales * Continued Focus on Strong Cash Flow * Seventh Dividen
Slide 17: Corporate Visual Identity
Corporate Visual Identity * Originated from 2010 Strategy Refresh Process — 2015 Vision * Driving Cultural Clarity + Using Regal to Identify the Company — Legal Name Not Changing « Visual Change — Bold, Contemporary and Simple ¢ Part of Overall Branding Simplification Effort p17
Slide 18: Questions and Answers
| DURST nove axan Questions and Answers pis
Slide 19: Closing Comments
REGAL Closing Comments + First Quarter Results - Great Start for the Year «Integration of the Acquisitions Progressing Well * Simplification Continues ¢ Improving Performance For Our Customers Thank You p19
Slide 20: Appendix Non-GAAP Reconciliations
Appendix Non-GAAP Reconciliations Net Income $34.3 $45.7 $33.5 $48.7 $162.2 Plus: Minority Interest 17 18 3 42 5.0 Plus: Taxes 14.4 20.6 14.7 178 67.5 Plus: Interest Expense 48 10.5 10.7 11.8 37.8 Less: Interest Income (4) (5) (6) (4) (1.9) Plus: Depreciation 15.0 174 18.4 20.1 70.9 Plus: Amortizati