Ingersoll Rand advances the quality of life by creating comfortable, sustainable and efficient environments. Ingersoll Rand (NYSE:IR) advances the quality of life by creating comfortable, sustainable and efficient environments. Our people and our family of brands — including Club Car®, Ingersoll Rand®, Thermo King® and Trane® — work together to enhance the quality and comfort of air in homes and buildings; transport and protect food and perishables; and increase industrial productivity and efficiency. We are a $13 billion global business committed to a world of sustainable progress and enduring results.
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Ingersoll Rand advances the quality of life by creating comfortable, sustainable and efficient environments.
Ingersoll Rand (NYSE:IR) advances the quality of
life by creating comfortable, sustainable and efficient
environments. Our people and our family of
brands—including Club Car®, Ingersoll Rand®,
Thermo King® and Trane®—work together to
enhance the quality and comfort of air in homes and
buildings; transport and protect food and
perishables; and increase industrial productivity and
efficiency. We are a $13 billion global business
committed to a world of sustainable progress and
enduring results.
2
Safe Harbor
This presentation includes “forward-looking statements,” which are statements that are not
historical facts, including statements that relate to the mix of and demand for our products;
performance of the markets in which we operate; our share repurchase program including the
amount of shares to be repurchased and timing of such repurchases; our projected 2017 full-
year financial performance and targets including assumptions regarding our effective tax rate.
These forward-looking statements are based on our current expectations and are subject to
risks and uncertainties, which may cause actual results to differ materially from our current
expectations. Such factors include, but are not limited to, global economic conditions, the
outcome of any litigation, demand for our products and services, and tax law changes.
Additional factors that could cause such differences can be found in our Form 10-K for the year
ended December 31, 2015, Form 10-Q for the quarters ended March 31, 2016, June 30, 2016,
and September 30, 2016, and other SEC filings. We assume no obligation to update these
forward-looking statements.
This presentation also includes non-GAAP financial information which should be considered
supplemental to, not a substitute for, or superior to, the financial measure calculated in
accordance with GAAP. The definitions of our non-GAAP financial information and reconciliation
to GAAP is attached to the earnings news release that can be found at www.ingersollrand.com
and are defined in footnotes at the end of this presentation. All data for beyond the fourth
quarter of 2016 are estimates.
2
Key Facts
• Ingersoll Rand has been listed continuously on the New York Stock Exchange since October 11, 1906
• Ingersoll Rand is the 16th oldest company and the 12th oldest continuously listed company on the NYSE
• $20B Market cap
Trades on NYSE
• Ingersoll Rand is 145 years old and was first incorporated in 1905
• $13.5 Billion Revenue
• Two business segments
• Climate - Commercial and Residential HVACand Transport Refrigeration
• Industrial – Air compression, Industrial products, low speed vehicles
Company Background
• Ingersoll Rand is incorporated in Swords, Ireland
• North American Headquarters in Davidson, NC
• 40,000 employees
• 51 manufacturing locations
Company Background
Key Facts
3
4
• A ~$10B group of six growth-oriented SBUs led by high-performing leaders and teams
• Trane and Thermo King are world leaders in HVAC and refrigerated transportation
• An outstanding network of global operations, channels and employees
• Stronger together with BOS linkage and commercial synergies
EMEA is Europe, Middle East, and Africa. Asia Pacific includes India. Services
includes aftermarket parts, accessories, and all types of service.
Commercial
HVAC
Residential
HVAC
HVAC
Parts & Supply
Transport
Solutions
68%
15%
11%
6%
North America
EMEA
Asia Pacific
Latin America
60%
40%
Equipment
Services
Climate Segment An Unmatched Strategic
Position
5
• A $3.0B group of five growth-oriented Strategic Business Units
• Ingersoll Rand, ARO and Club Car are #1 or #2 brands in their core markets
• World-class engineered and mission-critical products, systems and services
• Balanced across industries, geographic regions, equipment and aftermarket
• SBUs are stronger together with BOS linkage and channel synergies
EMEA is Europe, Middle East, India and Africa. Services includes aftermarket parts,
accessories and service.
AIR Power ToolsFluid
Management
Material
HandlingClub Car
55%
19%
21%
5%
North America
EMEIA
Asia Pacific
Latin America
65%
35%
Equipment
Services
Our Industrial Businesses are in Leading
Positions
5
2016 REVENUE: $13.5B 33% Aftermarket
By End Markets
66%North America
15%Eur/ME
14%Asia
5%Latin
America
By Geography
5%Golf/Utility
16%Transport
Refrigeration
16%Non-Res
Building
(Overseas)
31%Non-Res
Building
(N. America)
18%Industrial
Process
14%Residential,
(N. America)
67% New equipment
Represents Diverse End Markets and Geography
Climate77%
Industrial23%
By Segment
2016 Revenue Profile
2013 2014 2015
9.6
%
11.0
%
Adjusted Operating Margins
2016
11.9
%11.4
%
6
7
• Leading global brands and market positions
• Strong long-term growth drivers
- Macro drivers are energy efficiency and
sustainability
- Large installed base drives replacement
business and parts and service growth
- Global footprint and exposure to attractive
growing markets
- Organic growth enhanced by innovation
- Market recoveries
• Product/service offering underpinned by shared
technologies, materials, manufacturing, processes
and supply chain
• Continued margin and cash flow improvement
opportunity from operational/functional excellence
A world leader in creating comfortable, sustainable and
efficient environments
Ingersoll Rand: Foundational Strengths
7
8
Urbanization
Energy Consumption
Food & Water Scarcity
Climate Change
Industrial Productivity
& Efficiency
Ingersoll Rand Possesses Expertise to
Address Pressing World Challenges
8
9
Leading market sharesStrong, recognized brandsWell positioned in both
geographic and end markets
Strategic Foundation Continues to Underpin Top-Quartile Performance
Sustainable and Profitable
Growth, Cash Flow and Shareholder Value
Sustained
Growth
Operational
Excellence
Winning
Culture
Cash Flow /
Dynamic
Capital
Allocation
Strategic Foundation Continues to
Underpin Top-Quartile Performance
9
10
Steady operating performance improvement
$11.5
$12.0
$12.5
$13.0
$13.5
$14.0
2013 2014 2015 2016
Net Revenue
3% CAGR
In Billions
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
2013 2014 2015 2016
Adjusted EPS
0%
5%
10%
15%
20%
25%
2013 2014 2015 2016
Cash Flow ROIC
6 Ppts
16% CAGR
2.3 Ppts
Steady Operating Performance Improvement
10
0%
2%
4%
6%
8%
10%
12%
14%
2013 2014 2015 2016
Adjusted Operating Margin
11
2013 2014 2015 2016
1,345**
810862
985**
Strong Balance Sheet and Free Cash Flow
$ Millions YE 13 YE 14 YE 15 YE 16
Cash 1,937 1,705 737 1,715
Debt 3,521 4,224 4,218 4,070
Net Debt 1,584 2,519 3,481 2,355
Free Cash Flow$ Millions
*Reported – includes Allegion security business and excludes restructuring and one-time spin costs and refinancing premium
**Excludes the impact of the IRS agreement and restructuring in 2015 and excludes restructuring and the proceeds on the sale of
Hussmann in 2016
Post Security
Spin
1,151*
• 2011 to 2016 avg. FCF % of net income = 100%
• 2016 FCF % of adjusted net income = 121%
• FCF increase from higher operating results and working
capital management.
$5.14/share
11
12
Strategic Business
Investment
Maintained Strong
Balance Sheet
at BBB Metrics
Digital
Energy efficiency
Channel Expansion
No meaningful debt
maturities until 2018
Building value through
acquisitions
Working on our pipeline of
targets
$0.64
$0.84
$1.00
$1.16
$1.36
$1.60
2012 2013 2014 2015 2016 2017F
Share Repurchase – Minimum Offset
Dilution from Benefits Program
2016: Repurchased 4.9M shares
for $250M
2016 dividend increased to $1.60/
share
20% annual CAGR 2012 to 2017
Competitive Dividend Payout
36
55
76
98 103
108
2011 2012 2013 2014 2015 2016
Cumulative share repurchase
2011 to 2016 --108 million shares
2016 Dynamic Capital Allocation Focused on Delivering High Returns
12
13
• Strong momentum and further upside
‒ Attractive end markets
‒ Leading brands and growth through
innovation
‒ Substantial position in developing
markets with significant potential
• Excellent management team executing
consistently on strategy
• Value creation model delivers
sustainable results and returns to
shareholders
‒ Growth
‒ Operational Excellence
‒ Dynamic capital allocation
Much Progress…More Opportunity Ahead
13
Appendix
RESIDENTIAL HVAC
Heating, cooling, thermostat controls and home automation for
the residential market
COMMERCIAL HVAC
Air conditioning systems, services and solutions. Innovative
solutions geared toward making high performance buildings
reliable and safe, as well as healthy, comfortable and efficient
TRANSPORT REFRIGERATION
Manufacturing and innovation of transport temperature control
systems for a variety of mobile applications, including trailers,
truck bodies, buses, shipboard containers and rail cars
HVAC SERVICES AND PARTS
A complete selection of innovative parts, options and
accessories for optimal performance and reliability
Our Climate Businesses
15
COMPRESSION TECHNOLOGIES AND SERVICES
MATERIAL HANDLING
FLUID MANAGEMENT
CLUB CAR
POWER TOOLS
Rotary, centrifugal and reciprocating air compressors,
and treatment products with Comprehensive multi-
year service agreements, audits, parts, and
accessories
Hoists, winches and systems for
moving and positioning loads
Pumps and systems for fluid
handling, transfer, and application
Golf, commercial and utility
vehicles for transportation
Professional tools for fastening,
drilling, and surface preparation
Our Industrial Businesses
16
Fourth-Quarter 2016 Results
February 1, 2017
18
Leading market sharesStrong, recognized brandsWell positioned in both
geographic and end markets
Strategic Foundation Continues to Underpin Top-Quartile Performance
Sustainable and Profitable
Growth, Cash Flow and Shareholder Value
Sustained
Growth
Operational
Excellence
Winning
Culture
Cash Flow /
Dynamic
Capital
Allocation
2
19
Consistent Progress Against Key Metrics*
Net Revenue
Operating Margin
Adj. Continuing EPS*
Free Cash Flow*
Versus 2015
+2% reported
+3% organic
+60 bps
* Includes certain Non-GAAP financial measures. See the company’s Q4 2016 earnings release for additional details and
reconciliations.
+11%
+37%
Full Year 2016
$13,509M
11.6%
$4.13
$1.35B>100% adj. net income
• FCF was 121% of adjusted net income*
• Full-year operating leverage of 44%
• Repurchased ~4.9M shares for $250M in 2016
3
20
4
Steady Operating Performance Improvement
$11.5
$12.0
$12.5
$13.0
$13.5
$14.0
2013 2014 2015 2016
Net Revenue
3% CAGR
In Billions
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
2013 2014 2015 2016
Adjusted EPS
0%
5%
10%
15%
20%
25%
2013 2014 2015 2016
Cash Flow ROIC
6 Ppts
16% CAGR
0%
2%
4%
6%
8%
10%
12%
14%
2013 2014 2015 2016
Adjusted Operating Margin
2.3 Ppts
21
• Continued strong operating results
– FCF $353M in Q4; $1.35B 2016
– Combined operating results for segments exceeded guidance
• EPS miss vs guidance driven by discrete items
• Robust Commercial & Residential performance– Commercial bookings up high-single digits & Residential bookings up low-teens
– Margin expansion in both Commercial and Residential
Key Takeaways Q4 2016
• Industrial business steady on recovery path– Revenue up sequentially vs. Q3