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THE TORO COMPANY DECEMBER 18, 2024
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INVESTOR PRESENTATION THE TORO COMPANY2 INVESTOR PRESENTATION Safe Harbor This presentation contains forward-looking statements, which are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward- looking statements are based on management's current assumptions and expectations of future events and often can be identified by words such as "believe," "forward," "future," "goal," "guidance," "improve," "may," "outlook," "plan," "should," "target" and "would," variations of such words or the negative thereof, and similar expressions or future dates. Forward-looking statements in this presentation include our fiscal 2025 financial guidance and expectations regarding demand trends, supply chain stabilization and AMP. Forward-looking statements involve risks and uncertainties that could cause actual events and results to differ materially from those projected or implied. Such risks and uncertainties include: adverse worldwide economic conditions; the effect of abnormal weather patterns; customer, government and municipal revenue, budget spending levels and cash conservation efforts; loss of any substantial customer; inventory adjustments or changes in purchasing patterns by customers; fluctuations in the cost and availability of commodities, components, parts, and accessories; disruption at or in proximity to our facilities or certain third parties; risks associated with acquisitions and dispositions; impacts of our AMP initiative and any future restructuring activities or productivity or cost savings initiatives; and other risks and uncertainties described in our most recent annual report on Form 10-K, subsequent quarterly reports on Form 10-Q or current reports on Form 8- K, and other filings with the Securities and Exchange Commission. We make no commitment to revise or update any forward-looking statements in order to reflect events or circumstances occurring or existing after the date of this presentation. This presentation also contains non-GAAP financial measures and more information about our use of such non-GAAP financial measures, as well as a reconciliation of the most directly comparable historical U.S. GAAP financial measures to the corresponding historical non-GAAP financial measures, which can be found in our related financial filings in the section titled “Non- GAAP Financial Measures”. All financial results contained within this presentation are based on fiscal year ending October 31 figures
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INVESTOR PRESENTATION THE TORO COMPANY 3 The Toro Company: Built on Strong Relationships and Our Legacy of Excellence OVERVIEW OUR PURPOSE To help our customers enrich the beauty, productivity and sustainability of the land. OUR VISION To be the most trusted leader in solutions for the outdoor environment. Every day. Everywhere. OUR MISSION To deliver superior innovation and to deliver superior customer care.
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INVESTOR PRESENTATION THE TORO COMPANY 4 Investment Thesis OVERVIEW Attractive end markets, customer-centric innovation, and steady replacement cycles drive future organic growth 2 1 Well-positioned to win with deep expertise, leading market share positions, and best-in- class distribution and service networks – all of which create high barriers to entry 3 Building on a foundation of demonstrated consistent financial performance and cash flow generation 4 Financial headroom for strategic investments and disciplined approach to capital allocation enables delivery of value to all stakeholders
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INVESTOR PRESENTATION THE TORO COMPANY 5 An Innovative Professional & Residential Solutions Company Gas / Battery / Electric / Hybrid / Smart / Connected / Autonomous Drive brand and innovation leverage in high value spaces Of innovation and deep relationships Leveraging a strong balance sheet that provides financial flexibility With a distinguished portfolio of brands Provides a strong foundation for future growth BROAD ARRAY OF INNOVATIVE PRODUCTS COMPLEMENTARY BUSINESSES>100 YEARSDISCIPLINED EXECUTION BRAND LEADERSHIP LEADERSHIP IN ATTRACTIVE MARKETS Turf & landscape maintenance The Toro Company is a leading provider of products and solutions for the outdoor environment, including: Snow & ice management Underground utility construction Rental/specialty construction Irrigation Outdoor lighting solutions OVERVIEW
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INVESTOR PRESENTATION THE TORO COMPANYINVESTOR PRESENTATION THE TORO COMPANY Building on Our Expertise to Drive Our Future Enterprise Strategic Priorities Accelerating Profitable Growth Empowering People Driving Productivity & Operational Excellence The Toro Company is leveraging rich heritage and deep expertise to drive the business forward INVESTOR PRESENTATION THE TORO COMPANY OVERVIEW 6
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INVESTOR PRESENTATION THE TORO COMPANYINVESTOR PRESENTATION THE TORO COMPANY Supported on a Foundation of Delivering Consistent Financial Results 7 *Calculation and statements refer to TTC results from 2014 to 2024; CAGR = Compound Annual Growth Rate **Non-GAAP Measures: refer to the Appendix of this presentation for additional information and reconciliation +22.8% AVERAGE ROIC*,** +7.8% NET SALES CAGR* +10.7% ADJUSTED EPS CAGR*,** THE TORO COMPANYINVESTOR PRESENTATION OVERVIEW
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INVESTOR PRESENTATION THE TORO COMPANY8 INVESTOR PRESENTATION …with Attractive Operating Margins for Leveraged Growth Across the Portfolio 0% 5% 10% 15% 20% 25% Operating Margin History Professional Residential 2019 Charles Machine Works acquisition driving significant synergies going forward Average 2014 – 2024: PRO 18.0%; RES 10.7% THE PORTFOLIO * *Inclusive of gross non-cash impairment charges of $151.3M
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INVESTOR PRESENTATION THE TORO COMPANY9 Diversified and Complementary Portfolio Enables Scale While Reducing Seasonality… THE PORTFOLIO 2014 NET SALES $2.17B 2024 NET SALES $4.58B While both segments have grown, higher- margin Professional segment has become a larger portion of net sales 32% 26%7% 4% 31% 69% 31% 28% 25%21% 4% 22% 78% 22% By Segment By End Market Underground & Specialty Construction Golf Agricultural Micro Irrigation Landscape and Grounds* ResidentialProfessional *Includes contractor-grade lawn care and snow & ice management products, along with solutions for commercial grounds such as sports fields and municipalities
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INVESTOR PRESENTATION THE TORO COMPANY10 Serving Customers Throughout the World THE PORTFOLIO Sentosa Golf Club Singapore Manchester United England 80% 20% By Geographic Market U.S. Outside U.S. 2024 Net Sales 90% 10% By Product Type Equipment Irrigation St Andrews Links Scotland
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INVESTOR PRESENTATION THE TORO COMPANYINVESTOR PRESENTATION THE TORO COMPANY Together, These Key Differentiators Make Our Company Strong Regular product replacement creates recurring revenue Extensive distribution, service and support network creates competitive advantage across both segments Durable & steady free cash flow generation creates funding for profitable growth investments All-season capability & sector exposure creates stable and sustainable earnings Significant innovation creates synergies across all product categories Grass grows, snow falls, & infrastructure ages creates demand for our products TTC is well-positioned in attractive end markets INVESTOR PRESENTATION THE TORO COMPANY THE PORTFOLIO 11
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INVESTOR PRESENTATION THE TORO COMPANY12 Our Professional Segment at a Glance 78% 22% 2024 Geographic Net Sales Profile U.S. Outside U.S. 69% OF TOTAL COMPANY NET SALES $1.48B NET SALES 18.6% OPERATING MARGIN 2014 Strong Today, Building for Tomorrow 78% OF TOTAL COMPANY NET SALES $3.56B NET SALES 18.0% OPERATING MARGIN 2024 PROFESSIONAL SEGMENT
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INVESTOR PRESENTATION THE TORO COMPANY13 Operating From a Position of Strength PROFESSIONAL SEGMENT Addressing a variety of attractive end markets with steady replacement cycles Strong Market Position Driving considerable revenues within the total company portfolio, at higher margins Delivering Results Innovation combined with best-in-class distribution/service networks creates high barriers to entry #1 or #2 market share in many of the markets we serve PRO net sales CAGR of 7.8% over last 5 years We have expanded our portfolio and reach in fast growing end markets Significant Runway for Future Growth
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INVESTOR PRESENTATION THE TORO COMPANY 14 Diversified Customer Base We Provide Solutions to a Wide Array of Professionals Globally PROFESSIONAL SEGMENT Golf Courses Utility Companies Landscape Contractors* Communications Contractors Municipalities Rental Companies Sports Fields & Grounds Agribusiness *We also sell to homeowners who prefer contractor-grade lawn care solutions
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INVESTOR PRESENTATION THE TORO COMPANY15 Steady Cadence of New Product Introductions Drive Long-Term Growth Leveraging technology and innovation to help customers increase productivity, address labor challenges and achieve sustainability goals Ditch Witch AT120, world’s largest all-terrain horizontal directional drill Toro Groundsmaster® e3200 battery-powered out front rotary mower, leverages HyperCell Toro TimeCutter® Max Havoc MyRIDE® zero turn mower, provides increased operator comfort Exmark® Turf Tracer® with XiQ Technology, capable of mowing in manual or autonomous modes PROFESSIONAL SEGMENT
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INVESTOR PRESENTATION THE TORO COMPANYINVESTOR PRESENTATION THE TORO COMPANY Strong Demand Drivers in the Professional Segment PROFESSIONAL SEGMENT Regular Replacement Cycles 1 Aging and Expanding Infrastructure 2 Sustained Momentum in Golf 3 16 INVESTOR PRESENTATION THE TORO COMPANY
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INVESTOR PRESENTATION THE TORO COMPANY17 INVESTOR PRESENTATION Our Professional Solutions are Essential To Our Customers Typical turf equipment replacement cycle for contractors is about 3 to 5 years Typical lease duration for golf equipment is 3 to 4 years Extensive service and support network provides prompt access to parts and service Necessary nature of our products supports demand Heavy utilization rates drive regular replacement Preference for OEM parts Access to trusted service and support network is critical DEMAND DRIVERS – PROFESSIONAL SEGMENT Leading to consistent replacement and servicing cycle
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INVESTOR PRESENTATION THE TORO COMPANY18 INVESTOR PRESENTATION Infrastructure Investment is Increasing Globally Key Investment Areas Transportation and Data Communication Infrastructure Broadband Buildout Electric Grid Update Improved Water Quality Climate Change Protection Well-positioned to benefit from multi- year government and private infrastructure spending globally Specialization in underground equipment provides significant multi- year opportunity TTC has the most comprehensive underground and specialty construction equipment and brand line up in the industry DEMAND DRIVERS – PROFESSIONAL SEGMENT Infrastructure spending is a positive outlier in construction industry, with steady growth projected for foreseeable future
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INVESTOR PRESENTATION THE TORO COMPANY19 INVESTOR PRESENTATION Golf Continues to Experience Sustained Momentum Globally 2024 YTD rounds played in the U.S. through October are 2.6% ahead of the record pace set last year (Source: National Golf Foundation) We are the global market share leader in golf equipment and irrigation, and the only company to offer both, a competitive advantage We are well-positioned to capitalize on the strength of this market, with our deep relationships and over 100 years of industry-leading innovation DEMAND DRIVERS – PROFESSIONAL SEGMENT 2023 set a record for rounds played in the U.S. and exceeded 500 million for the fourth straight year (Source: National Golf Foundation) This momentum is global – since 2016 there has been a 44% rise in the number of on-course golfers outside North America (Source: R&A)
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INVESTOR PRESENTATION THE TORO COMPANY20 Our Residential Segment At a Glance 31% OF TOTAL COMPANY NET SALES $672.4M NET SALES 11.3% OPERATING MARGIN 2014 Strong Today, Building for Tomorrow 22% OF TOTAL COMPANY NET SALES $998.3M NET SALES 7.9% OPERATING MARGIN 2024 87% 13% 2024 Geographic Net Sales Profile U.S. Outside U.S. RESIDENTIAL SEGMENT
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INVESTOR PRESENTATION THE TORO COMPANY*Per individual counts listed on mass partner company websites21 Underpinned by Expansive Channels, Innovation Leverage & Strong Brands A power brand across all product categories Well-positioned to capitalize as this market rebalances Diversified global distribution & service channel creates significant customer reach New generation of Toro TimeCutter® and Titan® mowers driving share gains and enhancing market leadership Residential net sales CAGR of 8.6% over last 5 years Leveraging mass retailer partnerships with over 8,000* locations and built-in omnichannel solutions, plus a network of 4,000+ independent dealers globally RESIDENTIAL SEGMENT Strong Go-To-Market Position Delivering Results Path to Future Growth
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INVESTOR PRESENTATION THE TORO COMPANY 22 Well- Positioned for Future Growth with a Full Suite of Offerings for Homeowners Our full-suite of zero emission solutions for homeowners includes 75+ tools and counting. One system to finish everything without sacrificing anything – power without compromise. Further expansion into handheld and chore products end market through our 60V offerings provides incremental growth opportunity RESIDENTIAL SEGMENT
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INVESTOR PRESENTATION THE TORO COMPANY23 Professional & Residential Segments are Stronger Together Demand drivers across Professional and Residential segments coupled with leveraged R&D investments enables a long runway of profitable growth and attractive margins Driving market share gains, margin expansion and brand recognition Targeted approach to addressing unmet needs Customer First Sustained 3.5%+ of net sales annual investment R&D Expanding portfolio and capitalizing on synergies M&A STRONGER TOGETHER
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INVESTOR PRESENTATION THE TORO COMPANY24 Technology Pillars: Addressing the Megatrend Opportunity MEGATREND OPPORTUNITY Product Innovation Leveraged Across the Portfolio Drives Significant Opportunity • Zero exhaust emissions • Quiet operation • Easier maintenance • Addressing regulations Alternative Power & Electrification • Addressing labor shortages • Improving consistency Autonomous Solutions • Driving productivity • Loyal relationships • Data/customer insights • Subscription services Smart Connected Products 2021 autonomous technology accelerating acquisitions All of our solutions are engineered, field tested and refined to ensure the highest standards of performance, reliability and safety We don't just make products, we solve problems TTC's Center for Technology Research & Innovation consists of a dedicated team of agronomists and engineers who are a catalyst for holistic innovation across the enterprise
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INVESTOR PRESENTATION THE TORO COMPANY25 INVESTOR PRESENTATION Leadership Through Innovation Drives Market Share Gains and Attractive Margins *Bars reflect R&D expense in USD millions; Red line reflects R&D expense as a percentage of net sales **Percentage of net sales from new products introduced over the prior three years Resonating with customers as evidenced by strong Vitality Index** FINANCIALS Vitality Index** Organic growth driven by prioritized R&D spend R&D Investment and % of Net Sales* 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% $0 $20 $40 $60 $80 $100 $120 $140 $160 $180 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 35%
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INVESTOR PRESENTATION THE TORO COMPANY 26 Sustainability is Integrated into Our Company Purpose, Actions and Strategic Business Priorities SUSTAINABILITY Planning Sustainability Performance Goals: Aligned with six specific United Nations Sustainable Development Goals where we are best positioned to make the most significant and meaningful contribution Increase the number of women and racial and ethnic minorities in leadership positions by at least 20% by fiscal 2025 as compared to fiscal 2021 Increase battery and hybrid product sales to at least 20% of total adjusted* net sales (motorized product sales) by fiscal 2025 Reduce absolute Scope 1 and 2 greenhouse gas emissions by at least 15% by fiscal 2025 as compared to fiscal 2019 *For more information about TTC’s sustainability performance goals, please reference our latest Sustainability Report
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INVESTOR PRESENTATION THE TORO COMPANYINVESTOR PRESENTATION THE TORO COMPANY27 THE TORO COMPANYINVESTOR PRESENTATION Amplifying Maximum Productivity (“AMP”) Significant productivity initiative expected to deliver at least $100M incremental annual cost savings by 2027, a portion of which the company intends to prudently reinvest Supply Base Design to Value Route-to-Market Operational Efficiency2024 2026 $15M $100M+ Focus Areas for TransformationAnnualized Savings Implemented Program off to strong start, on track to achieve $100M of run-rate savings by 2027 FINANCIALS
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INVESTOR PRESENTATION THE TORO COMPANY*Non- GAAP Measures: refer to the Appendix of this presentation for additional information and reconciliation28 “AMP It Up" Initiative: 2025-2026 Employee initiative focused on driving profitability across the enterprise Employee rewards aligned with stretch goals create engagement at all levels FINANCIALS 11.0% 11.5% 12.0% 12.5% 13.0% 13.5% 14.0% 14.5% 2024 2026 Goal Adjusted Operating Earnings Margin *
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INVESTOR PRESENTATION THE TORO COMPANY *Non-GAAP Measures: refer to the Appendix of this presentation for additional information and reconciliation 29 Strong Balance Sheet and Resilient Free Cash Flow Free Cash Flow* Free Cash Flow Conversion* Gross Debt to EBITDA Ratio Provides solid foundation for capital deployment priorities FINANCIALS $461M $471M 2020 2021 2022 2023 2024 140% 112% 2020 2021 2022 2023 2024 Goal: 100% over time 1.5 X 1.3 X 2020 2021 2022 2023 2024 Target Range: 1.0x-2.0x
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INVESTOR PRESENTATION THE TORO COMPANY30 Capital Allocation Strategy Balanced approach to capital allocation has resulted in strategic investments driving significant growth and the return of more than $1.3B to shareholders over the last 5 years Prioritized allocation of cash from operating activities FINANCIALS *Guideline payout: 30-40% of three-year average reported earnings per share Capital expenditures - supporting organic growth with high returns1 Strategic acquisitions - disciplined process and proven track record2 Regular dividends - increases commensurate with earnings growth*3 Share repurchases - goal to at least offset dilution over time4 Capital Expenditures Strategic Acquisitions Dividends Share Repurchases 1 4 2 3 $2.58B 2020 - 2024
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INVESTOR PRESENTATION THE TORO COMPANY31 Acquisitions Have Played a Key Role in Our Profitable Growth Strategy and Remain a Focus Date of Acquisition Investment Rationale 2019 • Strengthen professional segment • Significant synergy opportunities • Exclusive and comprehensive distribution network • Strong brands • Attractive niche end market with high barriers to entry $725M 2020 • Strengthen professional segment • Leverage distribution networks • Strong brand • Expanded product offering to customers in the turf, landscape, and snow and ice maintenance categories $100M 2021 • Autonomous technology accelerators across entire portfolio • Talented teams N/A 2022 • Strengthen professional segment • Complementary Spartan brand in attractive zero-turn mower market • Procurement and design synergies within portfolio $200M Annual Revenue Pre-Acquisition (in USD) INVESTOR PRESENTATION THE TORO COMPANY FINANCIALS
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INVESTOR PRESENTATION THE TORO COMPANY 32 Key Takeaways KEY TAKEAWAYS 1 Portfolio strength with leadership in attractive end-markets 2 Brand heritage delivering excellence and brand recognition creating trust 3 Innovation and technology synergies leveraged across product categories 4 Deep long-term customer and channel relationships 5 Disciplined execution 6 Strong balance sheet
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APPENDIX
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INVESTOR PRESENTATION THE TORO COMPANY34 Our Portfolio of Brands
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INVESTOR PRESENTATION THE TORO COMPANY Appendix Manufacturing Locations Windom, MN Iron Mountain, MI Shakopee, MN Tomah, WI West Salem, OH Orrville, OH Lake Mills, WI Mount Sterling, KY Sanford, FL Beatrice, NEJuarez, Mexico El Paso, TX El Cajon, CA Perry, OK Hertfordshire, UK Althengstett, Germany Ustron, Poland Ploiesti, Romania Fiano Romano, Italy Monterrey, Mexico Xiamen, China Weatherford, TX Batesville, AR Global Footprint Although the Toro Company has a global footprint, over 90% of our manufacturing hours are attributable to North America operations 35
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THE TORO COMPANYTHE TORO COMPANY36 Accounts Receivable and Floor Plan Financing Majority of US independent dealers and distributors take advantage of inventory floor plan financing programs to fund their purchases, as is customary in our industry 2 1 TTC’s accounts receivable balance consists of sales to mass channel partners, irrigation customers, and many of our international dealers and distributors 3 Red Iron offers financing for the majority of our domestic dealers and distributors of lawn care, snow and ice management, and golf and grounds solutions, as well as Toro-branded specialty construction products 4 Third-party institutions also provide financing for a small portion of US dealers and distributors, some international channel partners, and the majority of our Ditch Witch underground construction distribution partners 5 TTC’s 45% non-controlling ownership stake in the Red Iron JV allows us to recoup a portion of our floor planning costs, and in accordance with GAAP the JV income is reported within “other income” in our income statement INVESTOR PRESENTATION
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THE TORO COMPANYTHE TORO COMPANY37 INVESTOR PRESENTATION Order Backlog This remains elevated compared to historical levels, driven by sustained demand in underground construction, and golf and grounds businesses 2 1 Order backlog (open order book) at the end of 2024 was ~$1.2B 3 Order backlog improved from ~$2B at the end of 2023, driven by our success in driving additional output within our existing manufacturing footprint 4 For specialty construction, which is primarily compact utility loaders, supply and demand came into balance during 2024, as expected; with this, order backlog for these products normalized during 2024 5 For underground construction and golf/grounds businesses, we expect order backlog will be close to normal by the end of 2025
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INVESTOR PRESENTATION THE TORO COMPANY38 Non-GAAP Financial Measures • This presentation contains certain non-GAAP financial measures, which are not calculated or presented in accordance with U.S. GAAP, as information supplemental and in addition to the most directly comparable financial measures calculated and presented in accordance with U.S. GAAP. The non-GAAP financial measures included within this presentation, as applicable, consist of gross profit, gross margin, operating earnings, earnings before income taxes, net earnings, net earnings per diluted share and the effective tax rate, each as adjusted, as well as free cash flow, free cash flow conversion percentage, return on average invested capital and EBITDA. • Management believes that the presentation of these non-GAAP measures provides useful information to investors and that these measures may assist investors in evaluating our core operational performance and cash flows, as a measure of our liquidity. • This Appendix includes a reconciliation of the historical non-GAAP financial measures used in the presentation to the most directly historical comparable GAAP financial measures. • Reconciliations of forward-looking non-GAAP guidance to projected U.S. GAAP guidance is not provided because it would require an unreasonable effort to do so. • Non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation, or as a substitute for, our financial measures prepared in accordance with U.S. GAAP. • Investors should note that any non-GAAP financial measure we use may not be the same non- GAAP financial measure, and may not be calculated in the same manner, as that of other companies.
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INVESTOR PRESENTATION THE TORO COMPANY39 Net Sales ($ in millions) 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Net Sales $2,172.7 $2,390.9 $2,392.2 $2,505.2 $2,618.7 $3,138.1 $3,378.8 $3,959.6 $4,514.7 $4,553.2 $4,583.8
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INVESTOR PRESENTATION THE TORO COMPANYAdjusted for stock splits * Includes: Impacts of U.S. Tax reform in 2018 and 2019; Litigation settlement in 2021; Non-cash impairment charges in 202340 Adjusted EPS 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 EPS, diluted - GAAP $1.51 $1.78 $2.06 $2.41 $2.50 $2.53 $3.03 $3.78 $4.20 $3.13 $4.01 Acquisition-related costs - - - - - $0.47 $0.05 - $0.03 - - Management actions/productivity initiative (AMP) - - - - - $0.13 $0.01 - - $0.04 $0.19 Tax impact of stock- based compensation - - - ($0.18) ($0.13) ($0.12) ($0.07) ($0.08) ($0.03) ($0.05) ($0.03) Other* - - - - $0.30 ($0.01) - ($0.08) - $1.09 - EPS, diluted - Adjusted $1.51 $1.78 $2.06 $2.23 $2.67 $3.00 $3.02 $3.62 $4.20 $4.21 $4.17
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INVESTOR PRESENTATION THE TORO COMPANY41 Gross Debt to EBITDA Ratio ($ in millions) 2020 2021 2022 2023 2024 Short Term Debt $99.9 - - - $10.0 Long Term Debt $691.3 $691.2 $990.8 $1,031.5 $911.8 Gross Debt $791.1 $691.2 $990.8 $1,031.5 $921.8 Earnings Before Income Taxes $407.1 $499.8 $552.5 $400.5 $512.8 Interest Expense $33.2 $28.7 $35.7 $58.7 $61.9 Depreciation and Amortization $95.6 $99.3 $108.8 $119.2 $128.2 EBITDA $535.8 $627.8 $697.1 $578.4 $702.9 Leverage Ratio 1.5x 1.1x 1.4x 1.8x 1.3x
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INVESTOR PRESENTATION THE TORO COMPANY42 Return on Average Invested Capital (%)* ($ in millions) 2014 2015 2016 2017* 2018* 2019* 2020* 2021* 2022* 2023* 2024* Adj. Op. Earnings* (1-Adj. Tax Rate) $178.4 $207.2 $233.7 $249.3 $290.6 $325.8 $343.3 $407.6 $462.6 $467.5 $455.0 Avg. Quarterly Capital Utilized $649.1 $852.7 $910.1 $935.4 $944.0 $1,437.0 $1,910.3 $1,962.6 $2,367.5 $2,653.8 $2,748.2 ROIC 27.5% 24.3% 25.7% 26.7% 30.8% 22.7% 18.0% 20.8% 19.5% 17.6% 16.6% =ROIC Adjusted Operating Earnings*(1-Adjusted Effective Tax Rate) Avg. Quarterly Capital Utilized * Non-GAAP Measure: 2017 through 2024 ROIC is calculated using Adjusted Operating Earnings, Adjusted Effective Tax Rate and Adjusted Net Earnings
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INVESTOR PRESENTATION THE TORO COMPANY43 Free Cash Flow Generation ($ in millions) 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Operating Cash Flow $196.9 $249.6 $384.3 $360.7 $364.8 $337.4 $539.4 $555.5 $297.2 $306.8 $569.9 Capital Expenditures ($71.1) ($56.4) ($50.7) ($58.3) ($90.1) ($92.9) ($78.1) ($104.0) ($143.5) ($142.4) ($99.2) FCF $125.8 $193.2 $333.6 $302.5 $274.7 $244.5 $461.3 $451.5 $153.7 $164.4 $470.7 FCF Conversion* 72% 96% 144% 113% 101% 89% 140% 110% 35% 50% 112% * FCF Conversion = Free Cash Flow/GAAP Net Earnings