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Q1 FY25 EARNINGS DECEMBER 19, 2024
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2 Forward-Looking Statements and Non-GAAP Measures Statements made in this presentation that are not historical are forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. In addition to statements with respect to guidance, the terms “outlook,” “guidance,” “may,” “should,” “could,” “anticipate,” “believe,” “estimate,” “expect,” “objective,” “plan,” “project” and similar expressions are intended to identify forward-looking statements. Such forward-looking statements are subject to inherent risks and uncertainties that may cause actual results or events to differ materially from those contemplated by such forward-looking statements. In addition to the assumptions and other factors referred to specifically in connection with such statements, risks and uncertainties that may cause actual results or events to differ materially from those contemplated by such forward-looking statements include, without limitation, general economic uncertainty, market conditions in the industrial, oil & gas, energy, power generation, infrastructure, commercial construction, truck and automotive industries, supply chain risks, including disruptions in deliveries from suppliers due to political tensions or the imposition, or threat of imposition, of tariffs, which could be affected by the outcome of the recent U.S. presidential election, the impact of geopolitical activity, including the invasion of Ukraine by Russia and international sanctions imposed in response thereto, as well as armed conflicts in the Middle East, including the impact on shipping in the Red Sea, the ability of the Company to achieve its plans or objectives related to its growth strategy, market acceptance of existing and new products, market acceptance of price increases, successful integration of acquisitions, the impact of dispositions and restructurings, the ability of the Company to continue to achieve its plans or objectives related to the PEP program, operating margin risk due to competitive pricing and operating efficiencies, risks related to reliance on independent agents and distributors for the distribution and service of products, material, labor, or overhead cost increases, tax law changes, foreign currency risk, interest rate risk, commodity risk, tariffs, litigation matters, cybersecurity risk, impairment of goodwill or other intangible assets, the Company’s ability to access capital markets and other risks and uncertainties that may be referred to or noted in the Company’s reports filed with the Securities and Exchange Commission from time to time, including those described in the Company’s Form 10-K for the fiscal year ended August 31, 2024. Enerpac Tool Group disclaims any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason. All estimates of future performance are as of December 18, 2024. This presentation also contains financial measures that are not measures presented in conformity with GAAP. These non-GAAP measures include organic sales, EBITDA from continuing operations, adjusted EBITDA from continuing operations, adjusted earnings from continuing operations, adjusted diluted earnings per share from continuing operations, adjusted operating profit from continuing operations, segment adjusted operating profit and adjusted EBITDA, adjusted SG&A, and net debt. The supplemental financial schedules appended at the end of this presentation include reconciliations of these non-GAAP measures to the most comparable GAAP measure. Enerpac Tool Group acknowledges that there are many items that impact a company’s reported results, and the adjustments reflected in these non-GAAP measures are not intended to present all items that may have impacted these results. In addition, these non-GAAP measures are not necessarily comparable to similarly titled measures used by other companies.
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3 Continued Softness in Industrial Macro Environment Latest Manufacturing PMI (Including Flash) Industrial Production (U.S.): Total Index (y/y change) Source: Board of Governors of the Federal Reserve System (US)Source: S&P Global, Haver Analytics, Goldman Sachs Global Investment Research -1.3% 1.2% 0.2% -1.3% -0.5%-0.4% -0.7% -0.6% -0.7%-0.8% -1.7% -0.4% 1.4% -1.8% -0.4% 0.4% -1.0% -0.2% 0.3% -0.5% 0.0% -0.6% -0.6% -0.9% -2.0% -1.5% -1.0% -0.5% 0.0% 0.5% 1.0% 1.5% 2.0% Dec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23 Jan-24 Feb-24 Mar-24 Apr-24 May-24 Jun-24 Jul-24 Aug-24 Sep-24 Oct-24 Nov-24
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4 Q1 Fiscal 2025 Revenue *Organic net sales is a non-GAAP measure and excludes the impact of foreign exchange rates, acquisitions, and dispositions identified in the accompanying reconciliations to GAAP measures. ($ in millions) Net Sales Net Sales Organic 1Q24 1Q25 Change Growth* Industrial Tools & Service (IT&S) $137 $140 2.3% -1.0% IT&S Product $105 $106 1.1% -3.0% IT&S Service $32 $34 6.0% +5.6% Other (Cortland Biomedical) $5 $5 2.6% +2.6% Enerpac Tool Group $142 $145 2.3% -0.8%
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5 Q1 Fiscal 2025 Profitability *Adjusted SG&A, adjusted EBITDA, and adjusted EPS are non-GAAP measures and exclude restructuring and other charges identified in the accompanying reconciliations to GAAP measures. ($ in millions, except EPS) YoY 1Q24 1Q25 Change Gross Margin 52.3% 51.4% -90bps Adjusted SG&A * 29.0% 29.0% flat Adjusted EBITDA* $35 $34 -2% Adjusted EBITDA Margin 24.6% 23.6% -100 bps Adjusted EPS* $0.39 $0.40 3%
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6 Balanced Capital Allocation Strategy Invest in Ourselves Investments in Digital, Product Innovation, R&D, Operational Excellence Improvements Maintain Our Strong Balance Sheet Target Leverage of 1.5x – 2.5x Disciplined M&A Opportunistically Returning Capital to Shareholders ~2.6M shares remaining on current 10M share repurchase authorization Asset-Light Model Enables Strong FCF ** Strong Liquidity & Balance Sheet *As of November 30, 2024, calculated in accordance with the terms of the Company’s September 2022 senior credit facility. **The Company calculates free cash flow as cash from operations, less capital expenditures. ($ in millions) $54 $52 $78 $81 $12 $7 $9 $11 $42 $44 $69 $70 FY21 FY22 FY23 FY24 Cash & Equivalents $131 Revolver Capacity (Undrawn) $399 Total Liquidity $529 Total Debt $193 Net Debt/Adj. EBITDA* 0.5x
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7 IT&S Organic Growth by Region * *Organic revenue growth excludes the impact of foreign exchange rates, acquisitions, and dispositions. FY24 IT&S Regional Sales Americas 46% EMEA 41% APAC 13% Region APAC +LSD% +MSD% EMEA +HSD% +LSD% Americas +MSD% -MSD% 1Q24 1Q25
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8 Accelerating Growth Strategic Efforts Optimizing Operations Focus Areas Minimizing Inefficiencies Continuous improvement projects in manufacturing and procurement Continuing to streamline SG&A through greater efficiency and productivity Execution and monitoring of growth strategy Standardizing Processes Solving Challenges Driving further global standardization and simplification leveraging 80/20 framework Structured problem-solving approach to determine true root-cause and implement countermeasures PEP in Action: Continued Margin Expansion
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9 Appendix
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N E T S A L E S $610 - $625M ~0-2% Organic Growth ~3-6% Total Growth A D J . E B I T D A* $150 - $160M F R E E C A S H F L O W $85 - $95M FY25 Guidance Key Assumptions: ▪ Targeting to outperform industry and gain market share ▪ No broad-based global recession 10 Depreciation & Amortization ~$14 - $16M Interest Expense ~$13 - $15M Adjusted Tax Rate ~21 - 26% Cash Taxes ~$35 - $40M Capex ~$19 - $24M Key FX Rates $1.10/1€, $1.31/1£ *Adjusted for one-time merger and acquisition costs.
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11 Historical Quarterly Results ($ in millions, except per share) *Adjusted Operating Profit, Adjusted EBITDA and Adjusted Diluted EPS exclude restructuring and other charges identified in the accompanying reconciliations to GAAP measures. Organic net sales excludes the impact of foreign exchange rates, acquisitions, and dispositions. The Enerpac Tool Group quarterly earnings releases and full GAAP to non-GAAP reconciliations are available online at https://ir.enerpactoolgroup.com/. $139 $142 $156 $161 $142 $138 $150 $159 13% 6% 4% 9% 5% 2% 1% 1% 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 Net Sales & YoY Organic Growth* $27 $32 $37 $40 $35 $34 $40 $39 19.1% 22.7% 24.0% 24.9% 24.6% 24.8% 26.4% 24.3% 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 Adjusted EBITDA and Margin* $23 $29 $34 $37 $32 $32 $37 $36 16.6% 20.2% 21.7% 23.0% 22.8% 22.8% 24.6% 22.5% 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 Adjusted Operating Profit and Margin* $0.29 $0.35 $0.39 $0.42 $0.39 $0.36 $0.47 $0.50 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 Adjusted Diluted EPS*
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12 LSD = low single digit, MSD = mid single digit, HSD = high single digit, LDD = low double digit , HT = high teens IT&S Organic Growth by Region Regional IT&S Organic Growth by Region Fiscal Fiscal 1Q23 2Q23 3Q23 4Q23 2023 1Q24 2Q24 3Q24 4Q24 2024 Americas +HT +LDD +MSD +HSD +LDD +MSD +LSD -LSD Flat +LSD EMEA +HSD +MSD Flat +MSD +MSD +HSD +MSD +LDD +LSD +HSD APAC +LSD +MSD +HT +HT +LDD +LSD -LSD -LDD -MSD -MSD
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13 Reconciliation of Non-GAAP Measures The Enerpac Tool Group fiscal 2025 Q1 earnings release and full GAAP to non-GAAP reconciliation is available online at https://ir.enerpactoolgroup.com/. The summation of individual components may not equal the total due to rounding. (US$ in millions) Consolidated Organic Sales by Quarter Q1 FY25 Organic Sales by Category Q1 FY23 Q1 FY22 % Change Net Sales $139 $131 6.5% Fx Impact - (7) Total $139 $124 12.6% Q2 FY23 Q2 FY22 % Change Net Sales $142 $137 3.9% Fx Impact - (3) Total $142 $133 6.4% Q3 FY23 Q3 FY22 % Change Net Sales $156 $152 2.9% Fx Impact - (2) Total $156 $150 4.3% Q4 FY23 Q4 FY22 % Change Net Sales $161 $152 5.8% Fx Impact - 1 Divestiture - (6) Total $160 $148 8.8% ETG Organic Sales - Q4 FY23 vs. Q4 FY22 ETG Organic Sales - Q1 FY23 vs. Q1 FY22 ETG Organic Sales - Q2 FY23 vs. Q2 FY22 ETG Organic Sales - Q3 FY23 vs. Q3 FY22 Q1 FY24 Q1 FY23 % Change Net Sales $142 $139 1.9% Fx Impact - 2 Divestiture - (7) Total $142 $135 5.5% ETG Organic Sales - Q1 FY24 vs. Q1 FY23 Q2 FY24 Q2 FY23 % Change Net Sales $138 $142 -2.5% Fx Impact - 0 Divestiture - (6) Total $138 $136 1.8% ETG Organic Sales - Q2 FY24 vs. Q2 FY23 Q3 FY24 Q3 FY23 % Change Net Sales $150 $156 -3.8% Fx Impact - (1) Divestiture - (7) Total $150 $149 1.2% ETG Organic Sales - Q3 FY24 vs. Q3 FY23 Q4 FY24 Q4 FY23 % Change Net Sales $590 $598 -1.5% Fx Impact - 1 Divestiture - (23) Total $590 $577 2.2% ETG Organic Sales - Q4 FY24 vs. Q4 FY23 Q1 FY25 Q1 FY24 % Change Net Sales $145 $142 2.3% Fx Impact - 1 Acquisition (3) 0 Total $142 $143 -0.8% ETG Organic Sales - Q1 FY25 vs. Q1 FY24 Q1 FY25 Q1 FY24 % Change Net Sales $140 $137 2.3% Fx Impact - 1 Acquisitions (3) - Total $137 $138 -1.0% Q1 FY25 Q1 FY24 % Change Net Sales $106 $105 1.1% Fx Impact - 1 Acquisitions (3) - Total $103 $106 -3.0% Q1 FY25 Q1 FY24 % Change Net Sales $34 $32 6.0% Fx Impact - 0 Total $34 $32 5.6% Q1 FY25 Q1 FY24 % Change Net Sales $5 $5 2.6% Fx Impact - - Total $5 $5 2.6% IT&S Organic Service Sales - Q1 FY25 vs. Q1 FY24 Other Sales - Q1 FY25 vs. Q1 FY24 IT&S Organic Sales - Q1 FY25 vs. Q1 FY24 IT&S Organic Product Sales - Q1 FY25 vs. Q1 FY24
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14 Reconciliation of Non-GAAP Measures The Enerpac Tool Group fiscal 2025 Q1 earnings release and full GAAP to non-GAAP reconciliation is available online at https://ir.enerpactoolgroup.com/. The summation of individual components may not equal the total due to rounding. (US$ in millions, except per share) Net Sales Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Enerpac Tool Group 139$ 142$ 156$ 161$ 142$ 138$ 150$ 159$ 145$ EBITDA Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Net earnings from continuing operations 6$ 7$ 17$ 23$ 18$ 18$ 23$ 23$ 22$ Financing costs, net 3 3 3 3 4 4 3 3 3 Income tax expense 2 3 5 5 6 7 7 3 6 Depreciation & amortization 4 4 4 4 3 3 3 3 4 EBITDA 16$ 17$ 29$ 35$ 31$ 32$ 36$ 33$ 34$ Adjusted Operating Profit Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Operating Profit 12$ 14$ 25$ 32$ 29$ 30$ 33$ 30$ 31$ Impairment & divestiture (benefit) charges - - - (6) 0 - - - - Restructuring charges (1) 1 3 2 1 2 0 2 3 - Leadership transition charges 0 0 0 0 - - - - - M&A charges - 0 0 1 - - - 0 0 ASCEND transformation program charges 9 11 6 9 1 2 2 2 - Adjusted Operating Profit 23$ 29$ 34$ 37$ 32$ 32$ 37$ 36$ 31$ Adjusted Operating Profit % 16.6% 20.2% 21.7% 23.0% 22.8% 22.8% 24.6% 22.5% 21.5% Adjusted EBITDA Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 EBITDA 16$ 17$ 29$ 35$ 31$ 32$ 36$ 33$ 34$ Impairment & divestiture (benefit) charges - - - (6) - - - - - Restructuring charges (1) 1 3 2 1 2 0 2 4 - Leadership transition charges 0 0 0 0 - - - - - M&A charges - - - 1 - - - 0 0 ASCEND transformation program charges 9 11 6 9 1 2 2 2 - Adjusted EBITDA 27$ 32$ 37$ 40$ 35$ 34$ 40$ 39$ 0$ Adjusted EBITDA % 19.1% 22.7% 24.0% 24.9% 24.6% 24.8% 26.4% 24.3% 23.6% Adjusted Net Earnings from Continuing Operations Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Net Earnings 7$ 4$ 12$ 22$ 18$ 18$ 26$ 24$ 22$ Earnings (loss) from Discontinued Operations, net 1 (3) (5) (1) (1) - 3 1 - Net Earnings from Continuing Operations 6$ 7$ 17$ 23$ 18$ 18$ 23$ 23$ 22$ Impairment & divestiture (benefit) charges - - - (6) - - - - - Restructuring charges (1) 1 3 2 1 2 0 2 3 - Leadership transition charges 0 0 0 0 - - - - - M&A charges - - - 1 - - - 0 0 ASCEND transformation program charges 9 11 6 9 1 2 2 2 - Accelerated debt issuance costs - - - - - - - - - Net tax effect of reconciling items above (1) (2) (3) (4) - - (1) (2) 0 Other income tax expense - - - - - 0 - - - Adj. Net Earnings from Continuing Operations 17$ 20$ 22$ 23$ 22$ 20$ 26$ 27$ 22$ Adjusted Diluted Earnings per share from Continuing Operations (net of tax effect) Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Net Earnings 0.13$ 0.08$ 0.22$ 0.40$ 0.32$ 0.33$ 0.47$ 0.44$ 0.40$ Earnings (loss) from Discontinued Operations 0.02 (0.05) (0.08) (0.02) (0.01) (0.00) 0.06 0.02 - Net Earnings from Continuing Operations 0.11$ 0.12$ 0.30$ 0.41$ 0.33$ 0.33$ 0.41$ 0.43$ 0.40$ Impairment & divestiture (benefit) charges - - - (0.11) 0.00 - - - - Restructuring charges (1) 0.02 0.05 0.03 0.01 0.04 0.00 0.02 0.04 - Leadership transition charges 0.01 0.00 0.00 0.00 - - - - - M&A charges - - - 0.01 - - - 0.00 0.00 ASCEND transformation program charges 0.15 0.17 0.06 0.10 0.02 0.03 0.03 0.03 - Accelerated debt issuance costs 0.01 0.00 0.00 0.00 - - - - - Other income tax expense - - - - - 0.00 - - - Adj. Diluted EPS from Continuing Operations 0.29$ 0.35$ 0.39$ 0.42$ 0.39$ 0.36$ 0.47$ 0.50$ 0.40$
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15 The Enerpac Tool Group fiscal 2025 Q1 earnings release and full GAAP to non-GAAP reconciliation is available online at https://ir.enerpactoolgroup.com/. The summation of individual components may not equal the total due to rounding. Reconciliation of Non-GAAP Measures (US$ in millions) Adjusted Selling, general and administrative expenses Q1 FY24 Q1 FY25 Selling, general and administrative expenses 45$ 42$ Selling, general and administrative expenses % 31.4% 29.1% Selling, general and administrative expenses 45$ 42$ SG&A Restructuring charges (1) (2) - Leadership transition charges - - M&A charges - 0 SG&A ASCEND transformation program charges (1) - Adjusted Selling, general and administrative expenses 41$ 42$ Adjusted Selling, general and administrative expenses % 29.0% 29.0% Free Cash Flow FY2021 FY2022 FY2023 FY2024 Cash provided by operating activities 54 52 78 81 Capital expenditures (12) (7) (9) (11) Free Cash Flow 42 44 69 70
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16 The Enerpac Tool Group fiscal 2025 Q1 earnings release and full GAAP to non-GAAP reconciliation is available online at https://ir.enerpactoolgroup.com/. The summation of individual components may not equal the total due to rounding. Notes to Reconciliation of Non-GAAP Measures (1) Approximately $0.4 million of the Q4 fiscal 2024 restructuring charges were recorded in cost of products sold. (2) EBITDA represents net earnings from continuing operations before financing costs, net, income tax expense, and depreciation & amortization. Neither EBITDA nor adjusted EBITDA are calculated based upon generally accepted accounting principles ("GAAP"). The amounts included in the EBITDA and adjusted EBITDA calculation, however, are derived from amounts included in the Condensed Consolidated Statements of Earnings. EBITDA and adjusted EBITDA should not be considered as alternatives to net earnings, operating profit or operating cash flows. The Company has presented EBITDA and adjusted EBITDA because it regularly reviews these performance measures. In addition, EBITDA and adjusted EBITDA are used by many of our investors and lenders, and are presented as a convenience to them. The EBITDA and adjusted EBITDA measures presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation. (3) Organic Sales (formerly referred to as "core sales") is defined as sales excluding the impact to foreign currency changes and the impact from recent acquisitions and divestitures to net sales (4) Adjusted earnings from continuing operations and adjusted diluted earnings per share represent net earnings and diluted earnings per share per the Condensed Consolidated Statements of Earnings net of charges or credits for items to be highlighted for comparability purposes. These measures are not calculated based upon GAAP and should not be considered as an alternative to net earnings or diluted earnings per share or as an indicator of the Company's operating performance. However, this presentation is important to investors for understanding the operating results of the current portfolio of Enerpac Tool Group companies. For all reconciliations of GAAP measures to Non-GAAP measures, the summation of the individual components may not equal the total due to rounding. With respect to the earnings per share reconciliations the impact of share dilution on the calculation of the net earnings or loss per share and discontinued operations per share may result in the summation of these components not equaling the total earnings per share from continuing operations.