Gates Industrial Corporation Plc · NYSE:GTES
Gates Industrial — Q2 2026 Earnings Presentation
20 slides from Gates Industrial's earnings presentation, Jul 31, 2026
Slide 1: Q2 2026 Earnings Presentation
Q2 2026 JULY 31, 2026 EARNINGS PRESENTATION
Slide 2: Legal Disclaimers
LEGAL DISCLAIMERS 2 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This presentation contains, and management may make on our call today, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 19
Slide 3: Q2 2026 Key Highlights & Metrics
Q2 2026 KEY HIGHLIGHTS & METRICS 3 Generated ~7% total sales growth • Strong core growth of ~5% across a broad set of industrial verticals • Record quarterly sales and adjusted EPS Solid operational execution • Adjusted EBITDA margin above expectations • Well positioned to achieve anticipated ad
Slide 4: Q2 2026 – Financial Performance
Q2 2026 – FINANCIAL PERFORMANCE 4 $942M 6.6% Total Growth YoY 4.9% core growth; record quarterly sales Improving Industrial order trends; Industrial Net Sales aftermarket beginning to turn $211M 22.5% Adjusted EBITDA margin Better vs. expectation Adjusted gross profit margin of 41.8%; up 50
Slide 5: Q2 2026 – Segment Results
Q2 2026 – SEGMENT RESULTS 5 PERFORMANCE HIGHLIGHTS POWER TRANSMISSION NET SALES $589M Industrial OEM delivered low-teens growth; Industrial Aftermarket remained positive with mid-single-digit 5.3% Core YoY expansion ADJUSTED EBITDA $135M Personal Mobility and On-Highway grew 25%+ Solid margin
Slide 6: Q2 2026 – Regional Core Sales Performance
Q2 2026 – REGIONAL CORE SALES PERFORMANCE 6 Total Gates Americas +4.9% EMEA 28% +11.4% Sales 51% Greater +6.4% China 21% +2.7% EMEA APAC North America +11.5% Americas: NA core growth APAC accelerated through the quarter with exit rate in MSD range +1.5% +11.7% EMEA: Industrial markets Americas E
Slide 7: Q2 2026 Adjusted EPS Walk
Q2 2026 ADJUSTED EPS WALK 7 $0.01 $0.44 $0.02 $0.01 $0.01 $0.39 Q2 2025 Adj. EPS Underlying Operating F/X Lower Tax Rate Share Count, Q2 2026 Adj. EPS Performance Interest and Other GENERATED DOUBLE-DIGIT ADJUSTED EPS GROWTH © 2026 Gates Corporation. All rights reserved.
Slide 8: Q2 2026 – Cash Flow & Capital Efficiency
Q2 2026 – CASH FLOW & CAPITAL EFFICIENCY 8 $60M Free Cash Flow LTM free cash flow conversion exceeded 90%+ LTM FCF conversion above historical averages 1.8x Net Leverage Record low net leverage YoY net leverage reduction of 0.4x while executing ~$22 million of share repurchases 21.6% ROIC Improv
Slide 9: Raising Full Year 2026 Financial Guidance
RAISING FULL YEAR 2026 FINANCIAL GUIDANCE 9 PRIOR 2026 CURRENT 2026 B/W (Midpoint) CORE SALES GROWTH +1.0% to +4.0% +2.5% to +4.5% +100bps ADJUSTED EBITDA $775M – $835M $800M – $830M +$10M ADJUSTED EPS $1.52 – $1.68 $1.62 – $1.70 +$0.06 CAPITAL EXPENDITURES ~$120M ~$120M No Change FREE CASH FLOW CON
Slide 10: Summary Thoughts
SUMMARY THOUGHTS 10 Delivered strong core growth in Q2; positioned to capitalize on the industrial recovery • Core growth expected to accelerate over the balance of the year • We believe the industrial cycle recovery is in the early stages Delivering on our commitments • 1H 2026 Adjusted EBITDA
Slide 11: © 2026 Gates Corporation. All rights reserved.
11 © 2026 Gates Corporation. All rights reserved.
Slide 12: Appendix
APPENDIX © 2026 Gates Corporation. All rights reserved.
Slide 13: Reconciliations – Core Sales Growth
RECONCILIATIONS – CORE SALES GROWTH 13 ( USD in million s ) Power Transmission Fluid Power Q2 2026 Reconciliation of Core Sales Growth Net sales for the quarter ended June 27, 2026 $ 588.5 $ 353.1 $ 941.6 Impact on net sales of movements in currency rates (9.5) (5.5) (15.0) Core sales for the quarte
Slide 14: Reconciliations – Adjusted EBITDA & Net Leverage
RECONCILIATIONS – ADJUSTED EBITDA & NET LEVERAGE 14 (USD in millions) Q2 2026 Q2 2025 LTM Q2 2026 LTM Q2 2025 Reconciliation to Adjusted EBITDA Net Income from Continuing Operations $ 178.2 $ 63.4 $ 389.7 $ 228.4 Adjusted for: (1) Other (income) expenses excludes foreign currency transaction losses
Slide 15: Reconciliations – Segment Adjusted EBITDA
RECONCILIATIONS – SEGMENT ADJUSTED EBITDA 15 (USD in millions) Change Change Q2 2026 Q2 2025 YTD Q2 2026 YTD Q2 2025 Reconciliation to Adjusted EBITDA Margin Power Transmission Net Sales $ 588.5 $ 550.1 $ 38.4 $ 1,121.7 $ 1,077.3 $ 44.4 Power Transmission Adjusted EBITDA $ 134.8 $ 122.8 $ 12.0 $ 246
Slide 16: Reconciliations – Adjusted Net Income
RECONCILIATIONS – ADJUSTED NET INCOME 16 (USD in millions, except share numbers and per share amounts) Q2 2026 Q2 2025 FY 2026 FY 2025 Reconciliation to Adjusted Net Income Net Income Attributable to Shareholders $ 170.9 $ 56.5 $ 230.6 $ 118.5 Adjusted for: Loss on the disposal of discontinued opera
Slide 17: Reconciliations – Adjusted Net Income (Cont.)
RECONCILIATIONS – ADJUSTED NET INCOME (CONT.) 17 (1) Transaction-related expenses relate primarily to advisory fees and other costs recognized in respect of major corporate transactions, including the acquisition of businesses, and equity and debt transactions. (2) Inventory adjustments include the
Slide 18: Reconciliations – Free Cash Flow & Free Cash Flow Conversion
RECONCILIATIONS – FREE CASH FLOW & FREE CASH FLOW 18 CONVERSION ( USD in million s ) Q2 2026 Q2 2025 LTM Q2 2026 LTM Q2 2025 Reconciliation of Free Cash Flow Net Cash Provided By Operating Activities $ 78.6 $ 103.0 $ 476.6 $ 417.1 Capital Expenditures (1) (18.7) (29.4) (98.5) (117.0) Free Cash Flow
Slide 19: Reconciliations – Return On Invested Capital (ROIC)
RECONCILIATIONS – RETURN ON INVESTED CAPITAL (ROIC) 19 (USD in millions) LTM Q2 2026 LTM Q2 2025 Return On Invested Capital (ROIC) LTM Adjusted EBITDA $ 772.4 $ 749.8 LTM Total depreciation and amortization (221.1) (213.3) LTM Amortization of intangible assets arising from the 2014 acquisition of Ga
Slide 20: Reconciliations – Adjusted Gross Profit
RECONCILIATIONS – ADJUSTED GROSS PROFIT 20 (USD in millions, except share numbers and per share amounts) Q2 2026 Q2 2025 YTD 2026 YTD 2025 LTM Q2 2026 LTM Q2 2025 Reconciliation to Adjusted Gross Profit Net Sales $ 941.6 $ 883.7 $ 1,792.7 $ 1,731.3 $ 3,504.6 $ 3,391.4 Cost of sales 555.5 523.5 1,068