Dover Corporation · NYSE:DOV
Dover — Q4 2016 Earnings Presentation
14 slides from Dover's earnings presentation, Jan 26, 2017
Slide 1: Earnings Conference Call Fourth Quarter 2016
Earnings Conference Call Fourth Quarter 2016 January 26, 2017 – 9:00am CT
Slide 2: Forward looking statements and non-GAAP measures
2 Forward looking statements and non-GAAP measures We want to remind everyone that our comments may contain forward-looking statements that are inherently subject to uncertainties and risks. We caution everyone to be guided in their analysis of Dover Corporation by referring to the documents we file
Slide 3: Q4 2016 Performance
3 $0.00 $0.25 $0.50 $0.75 $1.00 $1.25 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Earnings per share Adj. EPS* Q4 2016 Performance Earnings Per Share (continuing operations) Q4 Q4/Q4 * Excludes discrete tax benefits of $0.05 in Q3 2015, $0.06 in Q4 2015, $0.05 in Q1 2016, $0.05 in Q4 2016, a $0.01 discrete tax expense
Slide 4: Revenue Q4 2016
4 Revenue Q4 2016 Energy Engineered Systems Fluids Refrigeration & Food Equip Total Dover Organic -8% 1% flat -1% -2% Acquisitions - 8% 37% - 11% Dispositions - -3% - -9% -3% Currency -1% -1% -1% - -1% Total -9% 5% 36% -10% 5% FY 2016 Energy Engineered Systems Fluids Refrigeration & Food Equip Total
Slide 5: Energy
5 Energy Revenue decrease driven by year-over-year declines in oil & gas market fundamentals – Q4 2016 revenue up 7% sequentially – Bearings & Compression growth driven by positive customer mix Margin of 10.5% exceeds expectation, reflecting very strong incrementals YoY bookings decline narrow
Slide 6: Engineered Systems
6 Engineered Systems Organic revenue growth of 1% – 5% organic growth in Printing & Identification driven by strong marking & coding and digital textile markets – Industrial’s organic decline driven by reduced activity in Environmental Solutions Margin of 15.5% primarily reflects benefits of pro
Slide 7: Fluids
7 Fluids Revenue growth driven by acquisitions – Organic revenue essentially flat Strong Hygienic & Pharma markets Improved activity in Petrochemical & Polymer markets Weak longer cycle oil & gas markets, especially transport Margin impacted by product recall charge and acquisitions Book
Slide 8: Refrigeration & Food Equipment
8 Refrigeration & Food Equipment Organic revenue decline of 1% primarily driven by project timing in can-shaping equipment business Margin performance reflects gain on disposition, partially offset by production inefficiencies at Hillphoenix and product mix Organic bookings decline of 2% large
Slide 9: Q4 2016 Overview
9 Q4 2016 Overview 9 Q4 2016 Net Interest Expense $33 million, in-line with forecast Corporate Expense $32 million, higher than forecast, includes $3 million settlement charge Effective Tax Rate (ETR) Q4 rate was 25.4%. Excluding discrete tax items, Q4 rate was 29.0% Capex $49 million, generally in-
Slide 10: FY 2017F Guidance
10 FY 2017F Guidance Corporate expense: ≈ $125 million Net interest expense: ≈ $133 million Full-year tax rate: ≈ 28% Capital expenditures: ≈ 2.4% of revenue FY free cash flow: ≈ 11% of revenue 2017F Energy Engineered Systems Fluids Refrigeration & Food Equip Total Organic rev. 13% - 16% 1
Slide 11: 2017F EPS Guidance – Bridge
11 2017F EPS Guidance – Bridge 2016 EPS – Continuing Ops (GAAP): $3.25 – Less 2016 gain on dispositions(1): (0.44) – Less 2016 earnings from dispositions(2) : (0.05) – Plus 2016 charges related to expected recall: 0.09 2016E Adjusted EPS $2.85 – Net restructuring(3): 0.08 - 0.10 – Performance in
Slide 12: Slide 12
Slide 13: Appendix
13 Appendix
Slide 14: 2016 EPS – Bridge
14 2016 EPS – Bridge 2015 EPS – Continuing Ops (GAAP) $ 3.74 – Less 2015 tax items(1): (0.11) 2015 Adjusted EPS $ 3.63 – Net restructuring(2): 0.07 – Performance including restructuring benefits & net acquisitions (3): (0.40) – Compensation & investment: (0.05) – Interest / Corp. / Tax rate / Sh