Unlocking Value for Shareholders BAIRD INDUSTRIALS CONFERENCE November 10, 2015 Chicago, IL
Unlocking Value for Shareholders
BAIRD INDUSTRIALS CONFERENCE
November 10, 2015Chicago, IL
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Safe Harbor Statement
Any statements contained in this presentation that are not historical facts are “forward-looking
statements.” These statements are based on the current expectations of the management of the
company, only speak as of the date on which they are made, and are subject to uncertainty and
changes in circumstances.
We undertake no obligation to update or revise forward-looking statements, whether as a result of
new information, future events, or otherwise. Forward-looking statements include, without limitation,
statements typically containing words such as “intends,” “expects,” “anticipates,” “targets,” “estimates,”
and words of similar import. By their nature, forward-looking statements are not guarantees of future
performance or results and involve risks and uncertainties because they relate to events and depend
on circumstances that will occur in the future.
There are a number of factors that could cause actual results and developments to differ materially
from those expressed or implied by such forward-looking statements. These factors include, but are
not limited to, those relating to revenue growth of the company, future market strength of the com-
pany’s business segments and products, market acceptance of existing products and new product
introductions and technology, economic conditions, successful acquisitions, manufacturing and facility
utilization efficiencies, risks relating to actions of activist shareholders, and other factors listed in the
company’s annual report on Form 10-K for the year ended December 31, 2014. Any “forward-looking
statements” in this presentation are intended to qualify for the safe harbor from liability under the
Private Securities Litigation Reform Act of 1995.
TODAY AND SEPARATION PLANS
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Manitowoc’s TransformationManitowoc is a global industrial manufacturerwith two market-leading business platforms
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2003 2014
5.4%
7.7%
Transformative acquisitions
Integrationfocus on
deleveraging
Renewed Growthenhanced margins,
two strong platforms
Transformation has created opportunity for value enhancement
Manitowoc’s Transformation
2003 2014
$87
$299
2003 2014
$1.6
$3.9
Revenue($ Billions)
Operating Earnings($ Millions)
Operating Margins
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Planned SeparationEnhanced strategic focus to unlock value
To be tax-free spin-off of Foodservice business
All shares distributed to then-current Manitowoc shareholders
Capital structure and credit rating for each company consistent with that of Manitowoc today
Subject to customary closing conditions and opinion of tax-free nature
Target completion in the first quarter of 2016
Separate and distinct strengths and value creation strategies
Ability to attract long-term investor base appropriate for each company
Enables investors to value each independent company separately
Flexibility to optimize capital structure and capital allocation
Transaction Details Strategic Rationale
Creating two strong, independent public companies positioned to increase long-term shareholder value
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Guiding PrinciplesThese guiding principles will be used to develop separation strategies and implementation plans . . .
One enterprise until separation
We are one Manitowoc until we are not – we must all work together to deliver on our commitments
Incumbent leaders own their function and workstream decisions; ownership will transition to RemainCo and SpinCo leaders as we approach separation
Seamless experience for all
stakeholders
Establish a robust and pragmatic change program carefully managing employee experience
Mitigate business disruption through clear, coordinated communication
Plan and execute an issue-free transition of vendor and supplier contracts
Balance separation and optimization
Balance cost for both companies to operate effectively and robustly at separation
Develop competitive infrastructure for SpinCo and adjust size of RemainCo
Resolve issues within workstreams, escalating only a few select items to the Executive Steering Committee
Two strong companies at
separation
We are creating two strong companies with a clear and compelling value proposition for investors, employees, and other stakeholders
We will challenge ourselves to think about the business differently, to take on new roles and to move beyond our comfort zones
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Operate efficiently, effectively, and in the best interests of our shareholders
Governance Enhancements
Eliminate classified board structure on a phased-in basis commencing with the elections occurring at Manitowoc’s 2015 Annual Meeting of Shareholders
Governance commitments for standalone Foodservice entity:
Incorporation in Delaware
Annual elections for the Board
Stockholder rights plans restrictions
Holders of 10 percent of the outstanding shares will be permitted to call a special meeting
Focused on value creation for our shareholders
CREATING TWO INDUSTRY-LEADING
COMPANIES
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Creating Two Industry-Leading Companies Enhanced strategic focus to unlock value
v
24 industry leading brands
Broad product portfolio and culture of innovation
Global manufacturing footprint
Serves top 100 restaurant chains
Extensive aftermarket support with over 50% of revenues from renovation and replacement opportunities
Leading products across multiple platforms
Strong presence in emerging markets
Extensive manufacturing, sales, and customer service networks
Long track record of innovation
Exposed to attractive end markets poised for cyclical upturn
Strong after-market support
Foodservice Cranes
2014 Key Financials 2014 Key Financials
Revenue: $1.6 billion
Operating Earnings: $234 million
Operating Margin: 14.8%
Revenue: $2.3 billion
Operating Earnings: $164 million
Operating Margin: 7.1%
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Industry-Leading Foodservice Company
2009 2010 2011 2012 2013 2014
$164
$202 $215
$239 $250
$234
Margin
2009 2010 2011 2012 2013 2014
$1,303
$1,363
$1,455
$1,486$1,542
$1,581
Strong financial foundation with balanced business mix
Revenue($ Millions)
Operating Earnings($ Millions)
Americas
71%
EMEA
18%
Asia/Pac
11%
Travel
Leisure
11%
Retail
6%
Other
2%
Education
5%
Healthcare
5%
Business & Industry
2%
Restaurants69%
Geographic Exposure2015 Estimated U.S Foodservice Industry Sales by End Market
12.6%
14.8% 14.8%16.1% 16.2%
14.8%
Note: Geographic exposure based on 2014 revenue Source: National Restaurant Association
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Industry-Leading Foodservice Company
Broadest Portfolio Offering Market-leading Brands
Leading brands across multiple foodservice categories
Serving Global Customers Extensive Geographic Footprint
28 locations across 9 countries
24 manufacturing facilities
4 offices and technology center
Footprint allows Manitowoc Foodservice to better serve its customers
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Power / Utilities
22%
Industrial / Petrochemical
30%
Commercial Construction
19%
Residential Construction
11%
Infrastructure18%
Industry-Leading Crane Company
2009 2010 2011 2012 2013 2014
$151
$94 $119
$171
$219
$164
2009 2010 2011 2012 2013 2014
$2,253
$1,708
$2,135
$2,427$2,506
$2,305
Strong financial foundation positioned for significant cyclical growth
Revenue($ Millions)
Operating Earnings($ Millions)
Americas
52%EMEA
36%
Asia/Pac
12%
Geographic Exposure End Markets
6.7% 5.5% 5.6% 7.0%8.7% 7.1%
Margin
Note: Pie charts based on 2014 revenue
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Industry-Leading Crane Company
Award-winning Technology #1 in Major Crane Categories
Leading positions in each major crane category
Extensive Geographic FootprintServing Global Customers
Crawler Cranes
Tower Cranes
37 facilities across 18 countries
13 manufacturing facilities
21 sales/service centers
Strong presence in high-growth markets
Mobile Cranes
Boom Trucks
FOCUS ON EXECUTION AND SHAREHOLDER
VALUE CREATION
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Solid Execution, Strong Underlying Performance
Financial Performance Driving Shareholder Value
Improved Adjusted EBITDA1 Margins Increased ROIC
Strong Free Cash Flow1 Generation
Cumulative Free Cash Flow Since 2003
¹ Please see appendix for reconciliation to GAAP.
3.8%
9.1%
2003 2014
7.0%
11.0%
2003 2014
+400 bps +530 bps
$134 $167 $238$477
$618$784
$1,074$1,271 $1,241 $1,331
$1,548 $1,574
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
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5.7 x 5.8 x 5.4 x4.4 x
3.3 x 3.6 x
2009 2010 2011 2012 2013 2014
Significantly Improved Credit ProfileFinancial Performance Improvements Delivered While Strengthening Balance Sheet
Total Debt / Adjusted EBITDA1
Interest Coverage1
¹ Please see appendix for reconciliation to GAAP.Note: 2009 represents first full year following Enodis acquisition. Interest coverage defined as Adj. EBITDA/gross interest expense.
2.2 x 2.0 x2.4 x
3.0 x3.7 x
4.6 x
2009 2010 2011 2012 2013 2014
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Driving Growth Through Geographic ExpansionLeveraging Strong Positions in Developing Markets to Drive Growth, Complemented by Localized Innovation and Operational Effectiveness
Growth In International Foodservice Revenue
37 facilities across 18 countries
Products targeted toward specific needs of local markets
Constructed Cranes facility in Brazil in 2013 to leverage energy, infrastructure, and natural resource opportunities
Other emerging market facilities include Zhangjiagang, China (800k sq. ft.) and Pune, India (190k sq. ft.)
Foodservice Crane
28 locations across 9 countries
Products targeted toward specific needs of local markets
Built Foodservice facility in Monterrey in 2014
Strong presence in Chinese market with two facilities in Hangzhou, China (260k sq. ft.) and Foshan, China (40k sq. ft.)
Growth In International Crane Revenue
2003 2014
$42 mm $555 mm
2003 2014
$649 mm $1,351 mm
9%
91%
US
RoW 35%
65%
US
RoW
66%
34%
US
RoW
59%
41%US
RoW
+1,238% +108%
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Further Building Aftermarket BusinessIncreasing Revenue and Customer LoyaltyThrough Aftermarket Support
Superior Foodservice Aftermarket Service
Provides customers with total lifecycle support for every Manitowoc Foodservice product they operate
Key competitive advantage that reduces volatility via recurring revenue stream
Investments made to accelerate response times, broaden global capabilities, and strengthen technical support, including new KitchenCare parts warehouse
Supports growing chain customers, with programs touching nearly 15,000 chain locations in the U.S. to date
Superior Cranes Aftermarket Service
Provides customers with total lifecycle support for every Manitowoc Crane product they operate
Key competitive advantage that reduces volatility via recurring revenue stream
Investments made to accelerate response times, broaden global capabilities, and strengthen technical support
Identified service programs, such as installation and planned maintenance, as major elements of aftermarket growth strategy
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Sourcing/ Procurement
Focused on Continued Execution Of Operating Improvements
Operating Improvements Expected to Have Quantifiable Benefits
Lean Manufacturing
Other Efficiency
Improvements
Actions and ExamplesTotal 2017
Run-Rate Benefits
Purchasing transformation initiative
Improved processes, tools, data analysis
Trained purchasing professionals
Supplier agreements, SDI
Product cost take-out (PCTO)
Global sourcing initiative: $30-50M
PCTO initiatives
• FSG: $9-12M
• Cranes: $15M-25M
~$55M - $85M
Operating efficiencies
Value streams, flow manufacturing
Cost of poor quality (COPQ) reduction
Manitowoc Operating System (MOS)
Standardization
COPQ improvements
• FSG: $8M-10M
• Cranes: $15M-20M
Manufacturingimprovements
• FSG: $9M-11M
• Cranes: $15M-20M
~$45M - $60M
Segment reorganization
Reorganization
• FSG: $10M
• Cranes: $15M
~$25M
Projected 2017 Run-Rate Benefits
Total: $125-$170
THIRD-QUARTER AND FULL-YEAR
FINANCIAL REVIEW
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Third-Quarter and Full-Year Results
Q3 2015 Q3 2014 FY 2014 FY 2013
Net Sales $863.5M $986.3M $3.9B $4.0B
Cranes $438.2M $569.2M $2.3B $2.5B
Foodservice $425.3M $417.1M $1.6B $1.5B
Operating Earnings $42.2M $81.3M $299M $364M
Cranes $4.3M $41.6M $164M $219M
Foodservice $70.4M $61.9M $234M $250M
GAAP EPS $0.03 $0.53 $1.05 $1.05
ADJUSTED EPS $0.09 $0.36 $1.16 $1.45
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2015 Full-Year Guidance
Financial Metrics 2015 Guidance
Crane revenue Approximate 15 to 20 percent decline
Crane operating margins Low single-digit percentage
Foodservice revenue Approximately flat
Foodservice operating margins Mid-teens percentage
Capital expenditures Approximately $70 million
Depreciation and amortization Approximately $110 million
Interest expense Approximately $90 million
Amortization of deferred financing fees Approximately $4 million
Total Leverage Approximately 4.0x debt-to-EBITDA
Effective Tax Rate, excluding one-time costs caused by the spin-off
Approximately 30 percent
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Positioning two leading business platforms to unlock value
Conclusion
Challenging macro conditions likely to persist
Prudent investments, focused on growth and margin expansion opportunities
Planned separation to create two strong, independent public companies
Anticipated timeline for planned separation will allow us to prepare the businesses for ongoing success
By-law amendment declassifying the Board on a phased-in basis commencing with the elections at Manitowoc’s 2015 annual meeting of shareholders
Focused on value creation for our shareholders