Nordson Corporation · NASDAQ:NDSN
Nordson — Q3 2021 Earnings Presentation
36 slides from Nordson's earnings presentation, Aug 30, 2021
Slide 1: Investor Presentation
INVESTOR PRESENTATION August 30, 2021 I NASDAQ: NDSN Nordson’s container coating applications protect beverage cans while ensuring taste quality.
Slide 2: Safe Harbor Statement
Safe Harbor Statement Click to edit title Under the Private Securities Litigation Reform Act of 1995 Certain statements contained in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by
Slide 3: Nordson is an innovative precision technology company
Nordson is an innovative precision technology company that leverages a scalable growth framework to deliver top tier growth with leading margins and returns. Company Founded *Sales *EBITDA Employees Countries with Direct Presence 1954 $2.1B $567M 7,500+ 35+ 3 *Sales and EBITDA for the full fiscal ye
Slide 4: By the Numbers
By the Numbers Demonstrated Consistent Record Disciplined focus Differentiated Consistent value to Value to Solid Returns of Growth on profitability Product Portfolio* shareholders Customers 5% 54% 27% 13% 1,926 58 yrs. Sales Growth Gross Margins EBITDA Margins Global Patents of Annual ROIC Held Div
Slide 5: Commitment to ESG
Commitment to ESG Diversified Board of Directors Strong Culture and Values Environmental Stewardship ▪ 56% diverse board (3 gender and 2 ▪ Nordson Impact – Invest 5% of domestic ▪ Product design improvements focused on racially or ethnically diverse) pretax earnings in communities reducing customers
Slide 6: Diversified Sources of Sales
Diversified Sources of Sales FY2020 Profile - $2.1 Billion Product Type Geographies 33% Parts and Americas 43% Consumables 42% Europe 57% Systems Asia Pacific 25% High percentage of recurring Nearly 65% of sales outside USA. sales from parts and Direct presence in over consumables. 35 countries. 6
Slide 7: Diversified End Markets
Diversified End Markets Electronics Consumer Non-Durables Medical Industrial Remaining Markets 27% of revenue 26% of revenue 22% of revenue 14% of revenue 11% of revenue ▪ Semiconductor packaging ▪ Box sealing ▪ Balloons, extrusions, delivery ▪ Farm, construction and ▪ Consumer durable catheters and
Slide 8: How We Are Organized
How We Are Organized 55% 45% INDUSTRIAL PRECISION SOLUTIONS ADVANCED TECHNOLOGY SOLUTIONS Polymer Processing Industrial Coatings Electronic Processing Test and Fluid Adhesives Medical Solutions Solutions Systems Inspection Management 8 *Segment average mix for the full fiscal year ended 10/31/20
Slide 9: Industrial Precision Solutions
What We Do Industrial Product lines reduce material consumption, increase line efficiency, and enhance product Precision brand and appearance. Components are used for dispensing adhesives, coatings, paint, finishes, sealants and other materials. This business Solutions primarily serves the industria
Slide 10: Industrial Precision Solutions
Industrial Precision Solutions FY2020 Profile – Diverse end markets 6% End markets include: 10% ▪ Consumer Non-Durable: beverage, disposable hygiene, food, paper, textiles, non-wovens, packaging ▪ Industrial: aerospace, chemical, construction, defense, 10% energy, farm and construction machinery, in
Slide 11: Advanced Technology Solutions
What We Do Advanced Precision dispense, fluid management, test, inspection, surface treatment and proprietary Technology solutions for medical, electronics and general industrial markets. Solutions 5%+ CAGR Long-Term Growth Driven By: ▪ Medical – Aging population, trends toward non- invasive surgica
Slide 12: Advanced Technology Solutions
Advanced Technology Solutions FY2020 Profile – Diverse End Markets 2% 2% 6% End markets include: 7% ▪ Medical: minimally invasive interventional delivery devices, catheters, medical balloons, fluid connection components, specialty 40% tubing 15% ▪ Electronics: electronic components (i.e., computing;
Slide 13: Why Invest in Nordson?
Giordson Why Invest in Nordson?
Slide 14: A Diversified Precision Technology Company
A Diversified Precision Technology Company ▪ Sustained organic ▪ Data drives action ▪ Enhance depth REVENUE EBITDA growth ▪ Entrepreneurial, and diversity ▪ Accelerate acquisitions accountable ▪ Enrich inclusive culture $3B+ 30% Long-term 2025 financial targets 14
Slide 15: Driving profitable growth by selecting and investing in best opportunities
Driving profitable growth by selecting and investing disproportionately in the 15 best growth opportunities
Slide 16: Entrepreneurial division-led organization
Entrepreneurial division-led organization: ▪ Decisions close to the customer ▪ Autonomy + Accountability ▪ Clear line of sight to deploying NBS Next 16
Slide 17: Key ingredient to successful execution of the Ascend strategy
A key ingredient to successful execution of the Ascend strategy: ▪ Leaders inspiring trust and building followership in the organization ▪ Focus on inclusion and diversity in everything we do ▪ Create an engaging culture that attracts and retains top talent 17
Slide 18: Long-Term Financial Targets
Long-Term Financial Targets Top-tier growth with attractive margins and returns $3,500 35% $3,000 + 2015 - 2020 2020 - 2025 $3,000 30% $2,500 $2,121 30% Sales CAGR 5% 7%+ $2,000 $1,688 27% 25% $1,500 24% EBITDA CAGR 7% 10% $1,000 20% $500 Ending ROIC % 13% 13%+ $0 15% 2015 2020 2025 Sales EBITDA % 1
Slide 19: Disciplined M&A Strategy
Disciplined M&A Strategy Strategic Criteria Financial Criteria ▪ Differentiated precision technology based ▪ Attractive organic growth rate with Nordson-like product portfolio gross margins ▪ Serving attractive high-growth end market ▪ EBITDA ~20% with clear margin expansion applications opportuniti
Slide 20: Capital Allocation Priorities
Capital Allocation Priorities SUSTAINED INVESTMENT TO DRIVE DISCIPLINED M&A RETURN OF CAPITAL ORGANIC GROWTH ▪ Increased R&D investment ▪ Differentiated precision ▪ Strong history with 57-year of ▪ Sustained investment in direct technologies paying and increasing the sales model ▪ Financially discip
Slide 21: NDC Technologies Acquisition Highlights
NDC Technologies Acquisition Highlights Differentiated technology expands Opportunity to leverage NBS Next and Progress on Ascend Strategy to achieve top-tier test and inspection capabilities invest in growth opportunities growth with leading margins and returns • Adds proprietary technology with •
Slide 22: Investment Thesis
Investment Thesis 1. Strong growth drivers enabling Nordson’s future profitable growth performance 2. Proprietary precision technologies remain a competitive advantage 3. NBS Next is the framework driving our profitable growth 4. Ascend Strategy will deliver top tier financial performance ▪ Sustaine
Slide 23: Q3 F21 Financial Results
CNordson Q3 F21 Financial Results
Slide 24: 3Q 2021 Highlights
3Q 2021 Highlights Record sales and Strong execution and NBS Next 1 operating profit growth driving record results during economic recovery Recovery continuing in 2 medical, electronics and industrial end markets Successfully managing 3 supply chain and labor constraints 24
Slide 25: Total Company – 3Q 2021
Total Company – 3Q 2021 3Q 2021 Sales Bridge $647 Record Quarterly Sales Results $(20) $20 ▪ Reported sales increased 20%; excluding divestiture, sales increase would have been 24% $538 ▪ Organic growth increased 20% $109 ▪ Robust growth in all end markets, including seasonal increase into electroni
Slide 26: Cash Flow and Balance Sheet
Cash Flow and Balance Sheet Strong Cash Flow with Sufficient Liquidity to Invest in Strategic Initiatives Free Cash Flow Net Debt ▪ 83% conversion on net income ▪ Cash totaled $174 million ▪ $30 million pension contribution in the third quarter ▪ Net debt was $647 million ▪ Board approved 31% increa
Slide 27: Full-Year Fiscal 2021 Guidance
Full-Year Fiscal 2021 Guidance 2021 Sales Guidance $2,354 - $2,376 Raising Guidance for Fiscal 2021 $2,194 Updated Fiscal 2021 Guidance $2,121 ▪ Sales growth of ~11% to 12% ▪ Earnings per diluted share in the range of $7.75 to $7.95; growth of ~41% to 45% 2019 2020 2021 ▪ Strong backlog and strength
Slide 28: Appendix 1: Product Innovation
Appendix 1: Product Innovation
Slide 29: Our Electronics Industry Position
Our Electronics Industry Position Surface Mount Manufacturing Solder paste Flux spray Optical Inline Systems Plasma Underfill, Optical X-ray Conformal inspection coating inspection surface encapsulation inspection inspection coating treatment or precise coating Solder paste Component placement Reflo
Slide 30: Our Role in the Semiconductor Process
Our Role in the Semiconductor Process 30
Slide 31: Advanced Technology – Fluid Management
Advanced Technology – Fluid Management Life Sciences Precision Low-Volume Dispensing Optimum® Syringe Barrels and Tips Fluid Management Components From benchtop dispensers to industry-best Optimum® components are designed as a From specialty tubing, catheters, jetting valves and automated dispensing
Slide 32: Core Adhesives Innovative Technology
Core Adhesives Innovative Technology Auto-fill Tankless Variable Dispense Foaming Jetting Precision dispense Technology Technology Technology Technology technology Adhesive fill systems Delivering different Maintains bond strength Dispenses adhesive Increases production monitor and maintain add-on r
Slide 33: Appendix 2: Financial Exhibits
Appendix 2: Financial Exhibits
Slide 34: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures Adjusted Operating Profit and EBITDA (Dollars in thousands) 34
Slide 35: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures Profitability (Dollars in thousands) 35
Slide 36: Non-GAAP Definitions
Appendix Non-GAAP Definitions This presentation contains references to non-GAAP financial information. Although these are non-GAAP measures, we believe that they are useful to an investor in evaluating the company performance for the period presented. These non-GAAP definitions include: ▪ Adjusted o