Slides
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1 Chris Nelson President & CEO Patrick Hallinan EVP, CFO & Chief Administrative Officer Michael Wherley VP, Investor RelationsPRESENTERS: SECOND QUARTER 2026 OVERVIEW July 29, 2026
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2 Cautionary Statement This Presentation and related discussions contain “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 1934, as amended. All such statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to: any statements of goals, targets, priorities, projections, or guidance, planning assumptions or scenarios; any statements of the plans, strategies and objectives of management for future operations including expectations around the Company’s productivity and efficiency goals and future operational strategies; any statements concerning market share gain, proposed new products, services, developments, investments, or innovation and brand prioritization strategies; any statements regarding future economic conditions or performance, and the Company’s responses thereto, including potential price increases; any statements concerning future dividends, share repurchases or shareholder returns; any statements and assumptions regarding geopolitical events, possible tariff and tariff impact projections such as those concerning Section 122, 232 or 301 tariffs (including the amount, timing and materiality thereof), tariff refunds and related tariff mitigation plans including obtaining price increases and supply chain adjustments, and related mitigation timing and anticipated benefits; and any assumptions underlying any of the foregoing; and any such statements may include, among others, the words “may,” “will,” “estimate,” “intend,” “could,” “project,” “plan,” “continue,” “believe,” “expect,” “anticipate”, “annualized”, “forecast”, “commit”, “design”, “positioned or positioning”, “guidance” “looking forward”, “future”, “vision”, “strategy”, “long-term”, “on-track” or any other similar words. You are cautioned not to rely on these forward-looking statements, which are based on the Company’s current expectations and assumptions of future events. Each of the forward-looking statements involves risks and uncertainties that could cause actual results to differ materially from those expressed or implied in these forward-looking statements. Factors that might cause actual results, performance and achievements to differ materially from estimates or projections contained in forward-looking statements include, but are not limited to: the Company’s continued success with its productivity and efficiency initiatives post-transformation, complexity reduction, cost containment, and supply chain improvements; changes in macroeconomic conditions, including interest rates and geopolitical events; changes in trade-related regulations and restrictions such as import and export controls, tariffs, raw material and rare earth related clearances or controls and other monetary and non-monetary trade regulations or barriers, and the Company’s ability to predict the timing, extent, materiality, impact or disruptiveness to the Company of such regulations, restrictions, tariffs and import/export controls or clearances; the Company’s ability to successfully mitigate or respond to such macroeconomic, geopolitical, or trade, tariff and rare earth policy changes including, obtaining price increases from customers, repositions of supply chain, reprioritizing resources all within estimated time frames and costs and successful government engagement efforts; the timing and amount of any tariff refunds; the Company successfully developing, marketing and achieving sales from new products and services and the continued acceptance of current products and services as well as successful execution of, and realization of expected benefits from, the Company’s brand prioritization and investment strategy, including potential licensing initiatives and related restructuring efforts, and its ability to estimate and mitigate negative consequences from the same including, but not limited to, reduced ability to generate sales; and failure to realize the expected benefits of the Company’s value creation, debt reduction and capital allocation strategy; and those factors set forth in the Company’s corresponding Press Release and Form 8-K and its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and its other filings with the SEC. Forward-looking statements in this Presentation and related discussions speak only as of the date hereof, and forward-looking statements in documents that are incorporated by reference herein speak only as of the date of those documents. The Company undertakes no obligation or intention to update or revise any forward-looking statements, whether because of future events or circumstances, new information or otherwise, except as required by law. Additionally, Non-GAAP Financial Measures Are Referenced In This Presentation And Related Discussions. For Applicable Reconciliations To The Related GAAP Financial Measure And Additional Information, As Applicable, Please Refer To The Appendix Of These Materials And The Corresponding Press Release Which Are Available On Our Website Under The “Investors” Heading.
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3 2Q 2026 Key Messages Solid operating performance and gross margin expansion, boosted by 3% organic revenue* growth 33.7% Adj. Gross Margin* Gross productivity and product mix drove significant YoY improvement; Net tariff refunds3 contributed ~250 bps Flat YoY1 Organic Revenue* Up 3%1 $4.0B Total Net Sales Adjusted EPS* * Non-GAAP financial measure: Refer to appendix for additional information on all non-GAAP financial measures. 1. Factors do not sum due to rounding. 2. Portfolio includes divestiture of Consolidated Aerospace Manufacturing ‘CAM’ and licensing of the gas walk-behind outdoor products. 3. Adjusted gross margin includes net tariff refunds, which also benefited 2Q GAAP and Adjusted EPS by ~$0.17 per share; net tariff refund includes gross IEEPA tariff refunds received in 2Q, partially offset by directly attributable variable incentive compensation costs, growth investments, and taxes (for EPS only). 4. After- tax net gain on CAM divestiture contributed $1.08 of EPS. Price Flat Volume +3% FX +1% GAAP EPS: $2.33 $1.57 Thoughtful capital allocation strategy advances shareholder value creation Up 620 bps YoY Port. 2 -3% 3 $250M Share Buyback $1.7B Debt Reduction 3, 4 Following the sale of CAM
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4 11.8% $3,160M Net Sales Adj. Segment Margin* Organic Revenue* Up 3% Flat YoY PT +8% HTAS +2% OPG -7% N.A. +4% Europe - 2% RoW +3% Organic revenue* was primarily driven by power tools strength in U.S. retail supported by effective demand generation and continued professional demand in U.S. Commercial & Industrial channel. Predominantly due to net productivity gains and favorable product mix. Net tariff refunds2 contributed ~150 bps of the increase YoY. Adj. Segment Margin* Up YoY Up 380 Bps YoY Price +5% Volume -9% FX +2% Tools & Outdoor Segment $3,564M Net Sales Up 3% YoY1 Power tools and U.S. retail both returned to YoY growth 4 Price Flat Volume +3% FX +1% Port.1 -1% * Non-GAAP financial measure: Refer to appendix for additional information on all non-GAAP financial measures. 1. Portfolio includes licensing of the gas walk-behind outdoor products. 2. Net tariff refund includes gross IEEPA tariff refunds received in 2Q, partially offset by directly attributable variable incentive compensation costs, growth investments, and taxes (for EPS only).
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5 13.0% Adj. Segment Margin* Up 220 Bps YoY Engineered Fastening Segment Solid 2Q performance in its first quarter without CAM business Organic Revenue* Up 3% Adj. Segment Margin* Up YoY Organic growth* driven by automotive, which outpaced the market, and broad-based strength across global industrial markets. Largely driven by net productivity gains and favorable volume and mix in automotive. Net tariff refunds2 contributed ~50 bps of the increase YoY. 5 Price +1% Volume +2% FX Flat Port.1 -21% $396M Net Sales Down 18% YoY1 * Non-GAAP financial measure: Refer to appendix for additional information on all non-GAAP financial measures. 1. Portfolio includes divestiture of CAM. 2. Net tariff refund includes gross IEEPA tariff refunds received in 2Q, partially offset by directly attributable variable incentive compensation costs, growth investments, and taxes (for EPS only). +2% +7% Auto Industrial
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6 Building Momentum in Large-Scale Commercial Projects Delivering stronger brand performance through purposeful activation across the commercial construction ecosystem JOB SITE END-TO-END SOLUTIONS 360° TRAINING END USER ENGAGEMENT DISTRIBUTION SALES TRADE SCHOOLS
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7 Pre-Tax Non-GAAP Adjustments4: Flat to $40M Other Net*: ~$230M Net Interest Expense: ~$255M Depreciation*: ~$335M | Intangible Amortization: ~$110M Capex: ~$0.3B Adjusted Tax Rate*: ~19% | Shares: ~151M 3Q’26: ~$3.7B Net Sales; ~$1.50-$1.60 Adj. EPS* OTHER METRICS TOTAL COMPANY EPS TOTAL NET SALES2 YoY Organic Revenue* Currency CAM Divestiture (2Q-4Q) & Licensing OPG Gas Walk Behind3 ADJ. EBITDA MARGIN* $4.60 to $5.45 ~Flat Up LSD % Up ~1 % Down ~3% (inorganic) Positive YOY $5.20 to $5.80ADJUSTED EPS* 2026 Guidance1 (CAM included through April 6) TOOLS & OUTDOOR ENGINEERED FASTENING ORGANIC REVENUE* ADJ. SEGMENT MARGIN* Up LSD to MSD %Up LSD % Positive YoY Positive YoY • 301 tariffs to be enacted in 2H’26 at IEEPA-equivalent levels, consistent with prior guidance assumption • Temporary tariff rate tailwinds during ‘26 (IEEPA rates to 122 rates) offset by increased inflation (battery metals, tungsten, and oil derivatives) • Tariff Refund Impact o FY Adj. EPS guidance raise includes +$0.05 from net tariff refunds received; 2Q tariff refunds expected to be mostly offset by compensation considerations, growth investments, and tax – with growth investments biased to 2H’26 o Company has applied for additional refunds, but the timing and amount of refunds remain too uncertain to include in guidance at this time TARIFF & OTHER ASSUMPTIONS *Non-GAAP financial measure: Refer to appendix for additional information on all non-GAAP financial measures. 1. This guidance includes the results of the CAM business through April 6, 2026, and excludes the impact of any potential 2H’26 tariff refunds. 2. Forecasted total net sales reflects the impact of forecasted foreign currency, assuming the end of June 2026 rates. 3. Reflects strategic decision to transition from manufacturing gas-powered walk-behind products to a licensing model. Impact from CAM in 2Q-4Q and OPG Gas Walk Behind is excluded from Organic change calculation. 4. Includes gain of $277M on the CAM divestiture. Excluding that gain, the estimated pre-tax non-GAAP adjustments are $270M to $320M (~20% non-cash). Notes: 1) Total Sales forecast down 0.4% 2) CAM 2Q-4Q + GasWB impact = ~$335M (2.9%) 3) Eng. Fastening forecast to grow MSD % (guide of LSD-MSD implies 1% org in 2Q-4Q) Previous from April: Non-GAAP $10-$65M Other Net $240M Net Interest Exp $270M Deprec: $350M [$335M shown to BoD] Shares 153M Previous from April: EPS $4.15-$5.35 Adj EPS $4.90-$5.70 FCF $500-$700 FCF ex-CAM $700-$900 FCF* ex-CAM taxes/fees ~ $800M to $1.0B FREE CASH FLOW* ~ $600M to $800M
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8 Operational Focus Driving Strong Margin Performance and Thoughtful Capital Allocation Strategy Committed to delivering near-term and long-term margin and cash flow objectives, while strengthening earnings power to support long-term growth and shareholder value creation 2H Adj. Gross Margin* Expansion Forecast • 1H’26 margin outperformance supports 2H’26 trajectory to ~34%-35% • Long-term target remains: 35% - 37% 2H Up ~200 bps YoY Capital Deployment Update *Non-GAAP financial measure: Refer to appendix for additional information on all non-GAAP financial measures. 32.5% 2H'25 2H'26F • Following CAM divestiture on April 6: o Reduced debt by ~$1.7B in 2Q o Repurchased ~3.2M shares for $250M • Continue to prioritize share repurchases within our capital allocation framework • Strong free cash flow affording the ability to invest in growth, support the dividend, and repurchase our shares ~34-35%
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9 Building a World Class, Branded Industrial Company Delivering long-term value by solving our end users’ most pressing and complex challenges *Non-GAAP financial measure: Refer to appendix for additional information on all non-GAAP financial measures. Strategic Imperatives Activate Brands with Purpose Drive Operational Excellence Accelerate Innovation Focused on organic growth*, margin expansion, cash generation, and shareholder return; Committed to achieving 35%+ AGM* and preserving a solid investment grade balance sheet
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10 Q&A
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11 Liquidity and Free Cash Flow Reconciliation Financial flexibility in a challenging and dynamic environment Liquidity Key Points • Target: Maintain solid investment grade credit ratings • $3.0B in credit facilities backed by a well capitalized, diversified bank group which supports the commercial paper program • 3Q debt maturity (July 2026): ~$50M Liquidity Sources as of 2Q’26 Free Cash Flow ~$1.7B debt reduction, primarily from proceeds from CAM transaction Cash on hand $0.6B Addl. commercial paper capacity ($3.5B Max) $3.5B Total additional liquidity $4.1B $M Net Earnings 102$ 351$ 249$ 192$ 411$ 219$ Deprec / Amort 130 129 (1) 259 242 (17) Working Capital 128 282 154 (341) (107) 234 Gain on Sales of Businesses - (274) (274) - (271) (271) Asset Impairment Charges - 5 5 - 28 28 Other (146) 270 416 (316) 71 387 Cash From Operating Activities 214 763 549 (206) 374 580 CapEx (79) (65) 14 (144) (123) 21 Free Cash Flow* 135$ 698$ 563$ (350)$ 251$ 601$ 2025 Year-to-DateSecond Quarter V$ 20262025 V$2026 *Non-GAAP financial measure: Refer to appendix for additional information on all non-GAAP financial measures.
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12 Reconciliation of GAAP to Non-GAAP Measures
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13 Reconciliation of GAAP to Non-GAAP Segment Profit
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14 Reconciliation of GAAP to Non-GAAP Measures
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15 EBITDA Reconciliation
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16 Summary of Non-GAAP Adjustments
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17 Non-GAAP Financial Measures The Company has provided a discussion of its results both inclusive and exclusive of certain gains and charges. The results and measures, including gross profit, SG&A, Other, net, Income taxes, and segment profit, on a basis excluding certain gains and charges, free cash flow, organic revenue and organic growth are Non-GAAP financial measures. Organic revenue or organic sales is defined as the difference between total current and prior year sales less the impact of companies acquired and divested in the past twelve months, foreign currency fluctuations, transfers of product lines between segments, and the strategic transition to a licensing model for gas walk-behind outdoor product lines (as previously communicated). Organic revenue growth, organic sales growth or organic growth is organic revenue or organic sales divided by prior year sales. Gross profit is defined as sales less cost of sales. Gross margin is gross profit as a percent of sales. Segment profit is defined as sales less cost of sales and selling, general and administrative (“SG&A”) expenses (aside from corporate overhead expense). Segment margin is segment profit as a percent of sales. EBITDA is earnings before interest, taxes, depreciation and amortization. EBITDA margin is EBITDA as a percent of sales. Gross profit, gross margin, SG&A, segment profit, segment margin, earnings, EBITDA and EBITDA margin are adjusted for certain gains and charges, such as costs related to supply chain transformation and footprint actions, asset impairments, voluntary retirement program costs, environmental charges, divestiture-related items, restructuring, gains or losses on sales of businesses, and other adjusting items. Income taxes attributable to Non-GAAP adjustments are determined by calculating income taxes on pre-tax earnings, both inclusive and exclusive of Non-GAAP adjustments, taking into consideration the nature of the Non-GAAP adjustments and the applicable statutory income tax rates. Management uses these metrics as key measures to assess the performance of the Company as a whole, as well as the related measures at the segment level. Adjusted earnings per share or adjusted EPS, is diluted GAAP EPS excluding certain gains and charges. Free cash flow is defined as cash flow from operations less capital and software expenditures. Management considers free cash flow an important indicator of its liquidity, as well as its ability to fund future growth and to provide a return to the shareowners and is useful information for investors. Free cash flow does not include deductions for mandatory debt service, other borrowing activity, discretionary dividends on the Company’s common stock and business acquisitions, among other items. Free cash flow conversion is defined as free cash flow divided by net income. Net debt to adjusted EBITDA is total debt less cash on hand divided by adjusted EBITDA. The Non-GAAP financial measures are reconciled to GAAP on pages 12 through 17 of the press release and in slides 11 through 16. The Company considers the use of the Non-GAAP financial measures above relevant to aid analysis and understanding of the Company’s results, business trends and outlook measures aside from the material impact of certain gains and charges and ensures appropriate comparability to operating results of prior periods. The Company provides expectations for the non-GAAP financial measures of full year 2026 adjusted EPS, presented on a basis excluding certain gains and charges, as well as 2026 organic revenue growth and free cash flow. Forecasted full-year 2026 adjusted EPS and 2026 organic revenue growth are reconciled to forecasted full-year 2026 GAAP EPS and total 2026 revenue growth, respectively, on slide 7. Consistent with past methodology, the forecasted full-year 2026 GAAP EPS excludes the impacts of potential acquisitions and divestitures (unless otherwise noted), future regulatory changes or strategic shifts that could impact the Company's contingent liabilities or intangible assets, respectively, potential future cost actions in response to external factors that have not yet occurred, and any other items not specifically referenced on slide 7. Forecasted 2026 organic revenue growth assumes the impact of foreign currency using historical rates and excludes the impacts of potential acquisitions and divestitures. In addition to 2026 adjusted EPS and 2026 organic revenue growth, the Company also provides additional expectations for forward-looking non-GAAP financial measures, presented on a basis excluding certain gains and charges, as well as forecasted free cash flow (slide 7). A reconciliation of forecasted free cash flow to its most directly comparable GAAP estimate is not available without unreasonable effort due to high variability and difficulty in predicting items that impact cash flow from operations, which could be material to the Company’s results in accordance with U.S. GAAP. The Company believes such a reconciliation would also imply a degree of precision that is inappropriate for this forward-looking measure. The Company may also provide multi-year strategic goals or partial year forward-looking expectations for the non-GAAP financial measures of adjusted gross margin, adjusted EPS, and net debt to adjusted EBITDA, presented on a basis excluding certain gains and charges, as well as organic revenue or organic growth. A reconciliation for these non-GAAP measures is not available without unreasonable effort due to the inherent difficulty of forecasting the timing and/or amount of various items that have not yet occurred, including the high variability and low visibility with respect to certain gains or charges that would generally be excluded from non-GAAP financial measures and which could be material to the Company’s results in accordance with U.S. GAAP. Additionally, estimating such GAAP measures and providing a meaningful reconciliation consistent with the Company’s accounting policies for future periods requires a level of precision that is unavailable for these future multi-year periods and cannot be accomplished without unreasonable effort. The Company believes such a reconciliation would also imply a degree of precision that is inappropriate for these forward-looking measures.