EPG Conference Blake Moret Chairman and Chief Executive Officer May 21, 2018
SAFE HARBOR STATEMENT THIS PRESENTATION INCLUDES STATEMENTS RELATED TO THE EXPECTED FUTURE RESULTS OF THE COMPANY AND ARE THEREFORE FORWARD-LOOKING STATEMENTS. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE PROJECTIONS DUE TO A WIDE RANGE OF RISKS AND UNCERTAINTIES, INCLUDING THOSE THAT ARE LISTED IN OUR SEC FILINGS. THIS PRESENTATION ALSO CONTAINS NON-GAAP FINANCIAL INFORMATION AND RECONCILIATIONS TO GAAP ARE INCLUDED IN THE APPENDIX. ALL INFORMATION SHOULD BE READ IN CONJUNCTION WITH OUR HISTORICAL FINANCIAL STATEMENTS. 2
at A GLANCE $6.3B FISCAL 2017 SALES 22,000 EMPLOYEES 80+ COUNTRIES WORLD S LARGEST COMPANY DEDICATED TO INDUSTRIAL AUTOMATION AND INFORMATION AUTOMATION for a broad range SOLUTIONS of industries SERVING CUSTOMERS FOR 115 YRS Innovation Domain expertise Culture of integrity & corporate responsibility ABOVE-MARKET GROWTH PRODUCTIVITY INTELLECTUAL CAPITAL VALUE CREATION 3
Fiscal 2018 First Half Highlights ORGANIC SALES Broad-based growth across all regions Growth led by heavy industries Automotive sales down YOY, but up sequentially from Q1 to Q2 recovery in MRO business Emerging markets up high single digits 4.4% YOY SEGMENT OPERATING MARGIN Strong performance driven by higher sales and productivity, partially offset by investments Ramping up investments to accelerate profitable growth and increase long-term differentiation First half R&D spend up 9% YOY 150 bps YOY ADJUSTED EPS $3.85, up 17% YOY FREE CASH FLOW Conversion of 108% CAPITAL DEPLOYMENT Redeployed ~$0.9B in dividends and repurchases 4
Fiscal 2018 Second Half Outlook Solid macroeconomic indicators and favorable global manufacturing environment Early stages of manufacturing expansion cycle Continued broad-based organic growth across most regions and verticals Heavy Industry verticals largest growth driver Transportation expected to grow sequentially; flat to slightly down for the full year Strong H1 book-to-bill and backlog expected to drive higher Solutions & Services growth Increasing investments to expand the value of The Connected Enterprise Integration of our software with other design tools Scalable analytics and subscription services 5
Revised Fiscal 2018 Guidance APRIL GUIDANCE JANUARY GUIDANCE Sales ~ $6.7B ~ $6.7B Organic Growth Range 3.5% to 6.5% 3.5% to 6.5% Currency Translation ~ 2% ~ 2% Divestiture ~ (1)% ~ (1)% Segment Operating Margin ~ 21.5% ~ 21.5% Adjusted Effective Tax Rate ~ 20.5% ~ 21% Adjusted EPS $7.70 - $8.00 $7.60 - $7.90 Free Cash Flow as a % of Adjusted Income ~ 105% ~ 100% Note: As of April 25, 2018 6
Open Secure Scalable 7
The Connected Enterprise What Sets Us Apart UNDERSTANDING COMBINING SIMPLIFYING Access to Real-time Data Domain Expertise to Contextualize and Convert Data into Actionable Insights Scalable Analytics Open Architecture Partnership Approach Simplicity of a Single Platform Information Solutions and Connected Services revenue approaching $300M in FY18, growing double digits 8
Connected Enterprise Pilots TRANSPORTATION CONSUMER LIFE SCIENCES MINING & CEMENT OIL & GAS, CHEMICAL ASSET MANAGEMENT & RELIABILITY OPERATIONAL PRODUCTIVITY ENTERPRISE RISK DISCRETE HYBRID PROCESS 9
Connected Enterprise Multi-site Rollouts TRANSPORTATION CONSUMER LIFE SCIENCES MINING & CEMENT OIL & GAS, CHEMICAL ASSET MANAGEMENT & RELIABILITY OPERATIONAL PRODUCTIVITY ENTERPRISE RISK DISCRETE HYBRID PROCESS 10
Process Success and Growth FIRST HALF 2018 INDUSTRY CUSTOMER RESULT CHEMICALS Real-time & consolidated reporting Five month ROI Process organic growth Overall company organic growth 10% YOY 4.4% YOY MINING Easy integration (no downtime) Improved operations SECOND HALF 2018 FOOD & BEV CHEMICALS Advanced Petrochemicals of Saudi Arabia Capacity up over 4% Decreased energy usage 49% decrease in variability 38% increase in quality Continued Investment Expanding Capabilities Technology and Domain Expertise 11
CHALLENGE Automate process equipment and power control systems for NioCorp s critical minerals, mining and processing facility of superalloy metals SOLUTION Collaborative solution for standardization, control and connectivity across operations The combination of industry expertise, proven methodologies and advanced automation technology should help us develop a truly world- class mine. - Mark Smith, Executive Chairman and CEO, NioCorp CUSTOMER SUCCESS 12
Increased Capital Deployment Disciplined capital deployment will continue Organic growth mainly P&L investments FY17 restructuring helps fund increased investments while retaining ~35% earnings conversion Acquisitions Expanded corporate development team fully staffed Active pipeline for partnerships and acquisitions Key areas: information software, connected services, process expertise, regional share expansion with smart products Dividends and share repurchases Increased share repurchase target from $0.5B to $1.2B for FY18 Increased dividend by 10% in November 2017 and by 10% in April 2018 13
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