Slide 1: Q4 and Fiscal Year 2023 Financial Results Conference Call
Q4 and Fiscal Year 2023 Financial Results Conference Call David J. Wilson President & Chief Executive Officer Gregory P. Rustowicz Executive VP – Finance & Chief Financial Officer May 25, 2023
Slide 2: Safe Harbor Statement
Safe Harbor Statement These slides, and the accompanying oral discussion (together, this “presentation”), contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements concerning expected g
Slide 3: Proof Points of Progress
Proof Points of Progress Solid execution drives record performance for fiscal 2023 and fourth quarter Record sales, gross margin, operating income and Adjusted EPS for fiscal 2023 • FY23 sales of $936.2 million or $966.8 million on constant currency basis, up 7% • Record annual gross margin of 36.5%
Slide 4: Unlocking Potential: Productivity & Engagement
Unlocking Potential: Productivity & Engagement Improving the Customer Experience E2E DIGITAL ENABLEMENT Initiative Status Comments CRM: Case Management and Sales, Leads, Marketing Implemented in Conveying (globally) and Lifting (US & Canada) Advanced Call Center Initiated for Conveying; integrating
Slide 5: Unlocking Potential: Simplification with 80/20
Unlocking Potential: Simplification with 80/20 Simplification: Lifting & Linear Motion Past Present Future SKU’s 50,000 22,000 15,000 Purchased 450,000 239,000 100,000 Components WRH 11 5 2 Platforms ECH 12 10 5 Platforms Brand By Product By Product By Brand Positioning Platform Platform Promise Bra
Slide 6: Unlocking Potential: Profitable Growth
Unlocking Potential: Profitable Growth Acquiring montratec® Revenue Profile 4% 20% 11% 20% 35% 60% 22% 20% 80% 28% Europe U.S. APAC Direct Systems Integrators Auto/EV Semi/Elec Life Sci Other Aero • Develops and manufactures logistics solutions connecting robots and workspaces • Located near Stuttga
Slide 7: Unlocking Potential: Operational Performance
Unlocking Potential: Operational Performance Continued progress with gross margin expansion ADJUSTED GROSS MARGIN PROGRESSION GROSS MARGIN LEVERS ~40% Annual Improvements • Operational Excellence 36.5% • Volume/scale/pricing 36.1% 35.4% • Product line simplification 35.0% 34.1% 33.7% Strategic Initi
Slide 8: Net Sales
Net Sales ($ in millions) Q4 sales up 1.8% on constant currency from prior-year Quarter Sales Bridge • U.S.: 6.3% pricing increase and 6.0% volume decrease • Non-U.S.: 4.9% pricing and 0.8% volume decrease Quarter ($ in millions) $ Change % Change Fiscal 2022 Sales $ 253.4 Volume (9.9) (3.9)% $253.4
Slide 9: Gross Profit & Margin
Gross Profit & Margin ($ in millions) Quarter Gross Profit Bridge $91.2 $85.5 $86.3 ($ in millions) Quarter $82.5 $82.0 Fiscal 2022 Gross Profit $ 85.5 37.2% Price, net of material cost inflation 9.2 37.5% Prior year acquisition amortization of backlog 1.7 35.9% Prior year acquisition inventory step
Slide 10: RSG&A
RSG&A ($ in millions) Q/Q Comparison: RSG&A as • NPD Investments of $0.7M % of sales: 21.6% 24.1% 22.7% 24.1% 22.5% • Adjustment to annual incentive comp accrual of $2.8 million offset by Garvey contingent consideration of $1.2 million $55.4 $57.2 $54.8 $53.2 $52.5 Y/Y Comparison: $4.1 $4.8 $5.5 • A
Slide 11: Operating Income
Operating Income ($ in millions) Operating Income & Margin Record Q4 FY23 operating income up 14% y/y; operating margin expanded 130 bps to 10.8% $27.4 $27.5 $24.1 $22.8 • Margin and profit improvement reflect pricing $20.2 • More than offset impact of lower volume and less favorable mix and higher
Slide 12: Earnings Per Share
Earnings Per Share GAAP Diluted EPS Q4 FY23 GAAP net income grew 17% to $13.9 million, up $0.07 per diluted share y/y $0.49 $0.48 • Strong operating income and benefit of FX gain more than $0.41 $0.42 offset $2.3 million increase in interest expense $0.29 Adj. net income of $23.1 million in the quar
Slide 13: Adjusted EBITDA & ROIC
Adjusted EBITDA & ROIC Adjusted EBITDA and Margin Return on Invested Capital (ROIC)(1) 7.5% $147.8 6.6% 7.0% $140.1 $77.2 11.9% 15.4% 15.8% FY21 FY22 FY23 FY21 FY22 FY23 Focused on Key Metrics to Drive Profitable Growth and Transform the Business 13 © 2023 COLUMBUS MCKINNON CORPORATION (1)ROIC is a
Slide 14: Cash Flow
Cash Flow ($ in millions) (2) Free Cash Flow & Conversion Three Months Ended Year Ended 3/31/23 3/31/22 3/31/23 3/31/22 $97.4 Net cash provided by $66.7 $25.2 $83.6 $48.9 $86.6 operating activities $71.0 CapEx (3.1) (3.6) (12.6) (13.1) Free cash flow (FCF) $63.6 $21.6 $71.0 $35.8 Note: Components ma
Slide 15: Capital Structure
Capital Structure ($ in millions) CAPITALIZATION Net debt leverage ratio of ~2.2x(1) March 31, March 31, • Net debt to net total capital improved 500 bps y/y to 2023 2022 28.9% Cash and cash equivalents $ 133.2 $ 115.4 • Proforma leverage of 2.7x following montratec acquisition Total debt 471.6 511.
Slide 16: Orders and Backlog
Orders and Backlog ($ in millions) Orders Reflect Normalizing Demand Backlog Steady Y/Y at $308.7 million • Orders improved 14% sequentially driven by oil & gas, • Short term backlog represents 70% of Q1 FY24 revenue transportation, metals processing and entertainment guidance at mid-point of range
Slide 17: Executing to Deliver Strategic Plan Growth Objectives
Executing to Deliver Strategic Plan Growth Objectives Outlook is encouraging (1) • Expect Q1 FY24 net sales of approximately $235 million to $240 million representing high single digit growth • Continue to expect FY24 organic growth in low-to-mid single digits • Steady demand across end markets; cap
Slide 18: Q4 Fiscal Year 2023 Financial Results Conference Call
Q4 Fiscal Year 2023 Financial Results Conference Call David J. Wilson President & Chief Executive Officer Gregory P. Rustowicz Executive VP – Finance & Chief Financial Officer May 25, 2023
Slide 19: Supplemental Information
OW Supplemental Information INTELLIGENT MOTION PURPOSE IN MOTION
Slide 20: Conference Call Playback Info
Conference Call Playback Info Replay Number: 412-317-6671 passcode: 13738230 Telephone replay available through June 1, 2023 Webcast / PowerPoint / Replay available at investors.columbusmckinnon.com Transcript, when available, at investors.columbusmckinnon.com 20 © 2023 COLUMBUS MCKINNON CORPORATION
Slide 21: Adjusted Gross Profit Reconciliation
Adjusted Gross Profit Reconciliation ($ in thousands) Quarter Q4 FY22 Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 GAAP gross profit $ 85,475 $ 82,519 $ 86,310 $ 82,044 91,218 Add back (deduct): Acquisition inventory step-up expense 1,546 — — — — Product liability settlement — — — — — Acquisition amortization of
Slide 22: Adjusted Gross Profit Reconciliation
Adjusted Gross Profit Reconciliation ($ in thousands) Fiscal Year 2019 2020 2021 2022 2023 GAAP gross profit $ 304,997 $ 283,186 $ 220,225 $ 315,730 $ 342,009 Add back (deduct): Product liability settlement — — — 2,850 — Acquisition amortization of backlog — — — 2,100 — Acquisition inventory step-up
Slide 23: Adjusted Income from Operations Reconciliation
Adjusted Income from Operations Reconciliation ($ in thousands) Quarter Fiscal Year Q4 FY22 Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 2022 2023 GAAP income from operations $ 24,059 $ 22,817 $ 27,372 $ 20,179 $ 27,469 $ 73,781 $ 97,841 Add back (deduct): Acquisition deal and integration costs 229 86 19 338 173
Slide 24: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation ($ in thousands, except per share data) Quarter Fiscal Year Q4 FY22 Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 FY 2022 FY 2023 GAAP net income (loss) $ 11,826 $ 8,391 $ 14,114 $ 12,029 $ 13,895 $ 29,660 $ 48,429 Add back (deduct): Amortization of intangibles 6,635 6,535 6,447
Slide 25: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation ($ in thousands) Quarter Fiscal Year Q4 FY22 Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 2022 2023 GAAP net income (loss) $ 11,826 $ 8,391 $ 14,114 $ 12,029 $ 13,895 $ 29,660 $ 48,429 Add back (deduct): Income tax expense (benefit) 6,154 8,893 4,953 4,701 7,499 8,786 26,046 Intere
Slide 26: Return on Invested Capital (ROIC) Reconciliation
Return on Invested Capital (ROIC) Reconciliation ($ in thousands) Fiscal Year 2021 2022 2023 GAAP income from operations 42,255 73,781 97,841 Add back (deduct): Acquisition deal and integration costs 3,951 10,473 616 Acquisition inventory step-up expense — 5,042 — Product liability settlement — 2,85
Slide 27: Free Cash Flow (FCF) & FCF Conversion Reconciliation
Free Cash Flow (FCF) & FCF Conversion Reconciliation ($ in thousands) Fiscal Year 2021 2022 2023 Cash from operations $ 98,890 $ 48,881 $ 83,636 Capital expenditures (12,300) (13,104) (12,632) Free cash flow (FCF) $ 86,590 $ 35,777 $ 71,004 GAAP net income $ 9,106 $ 29,660 $ 48,429 Free cash flow co
Slide 28: Industrial Capacity Utilization
Industrial Capacity Utilization U.S. Capacity Utilization Eurozone Capacity Utilization Source: The Federal Reserve Board Source: European Commission 85% 80% 78.3% (Manufacturing) 79.7% (Total) 83% Apr 2023(1) 81% 81.0% Q1 2023 75% 79% 77% 70% 75% 73% 71% 65% 69% 67% 60% 65% Manufacturing Total (1)
Slide 29: ISM Production Index
ISM Production Index Source: Institute for Supply Chain Management 70% 65% 60% 55% 50% 48.9% April 2023 45% 40% 35% 30% 25% 29 © 2023 COLUMBUS MCKINNON CORPORATION
Slide 30: Business Model Transformation
Business Model Transformation Innovation drives strategy and portfolio transformation Revenue FUTURE Growth Rate Specialty FY23 Conveying Linear Motion Linear Automation Motion 14% 10% Automation Specialty Conveying 16% FY21 Lifting Solutions Linear Motion Lifting Solutions & Automation 60% Lifting
Slide 31: Unlocking CMCO's Potential
Unlocking CMCO’s Potential Business System and Core Growth Framework to Transform CMCO CMBS GROWTH FRAMEWORK TRANSFORMATION Framework to Deliver Differentiated Growth, Financial Performance and Shareholder Value 31 © 2023 COLUMBUS MCKINNON CORPORATION
Slide 32: Q4 Fiscal Year 2023 Financial Results Conference Call
Q4 Fiscal Year 2023 Financial Results Conference Call David J. Wilson President & Chief Executive Officer Gregory P. Rustowicz Executive VP – Finance & Chief Financial Officer May 25, 2023