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| 8-K - 8-K - Colfax CORP | a8-kguidancecalldecember20.htm |
December 16, 2016
Path Forward Into 2017
2
Forward-looking Statements
These slides and accompanying oral presentation contain forward-looking statements, including forward-looking
statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking
statements include, but are not limited to, statements concerning Colfax's plans, objectives, expectations and intentions
and other statements that are not historical or current fact. Forward-looking statements are based on Colfax's current
expectations and involve risks and uncertainties that could cause actual results to differ materially from those expressed
or implied in such forward-looking statements. Factors that could cause Colfax's results to differ materially from current
expectations include, but are not limited to factors detailed in Colfax's reports filed with the U.S. Securities and
Exchange Commission including its 2015 Annual Report on Form 10-K under the caption "Risk Factors." In addition,
these statements are based on a number of assumptions that are subject to change. These slides speak only as of this
date. Colfax disclaims any duty to update the information herein.
The term "Colfax" in reference to the activities described in these slides may mean one or more of Colfax's global
operating subsidiaries and/or their internal business divisions and does not necessarily indicate activities engaged in by
Colfax Corporation.
3
Colfax Strategy – A Winning Model
Focus and
Empower Top
Talent
Acquire Good
Companies
Use CBS to Make
Them Great
Attractive markets
Strong brands and
solutions
Opportunities to
improve and expand
Values
Tools and
processes
Way of working
Independent
businesses
Great leaders, strong
teams, winning spirit
Lean, high value
corporate
WE USE CBS TO MAKE GOOD BUSINESSES GREAT
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Executing in 2016
Achieving target of $50 million restructuring cost savings
Affirming 2016 guidance of $1.50 to $1.55 Adj. EPS
Strengthening position in key welding markets like Europe, Russia,
India, and South America
Improving service levels
Success on key projects and aftermarket initiatives
Investing in regional organizations in Middle East, South Asia, and
Southeast Asia
Exciting pace of new products Rebel, Renegade, Cutmaster,
WeldCloud, SmartEXEC, and many more
BUILDING MOMENTUM INTO 2017
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Driving Shareholder Value
Mid-teen
segment
margins
GDP +1-2%
organic
growth
Acquire to
compound
returns
Strengthen the foundation
− Deeper, empowered talent accelerating performance
− Colfax Business System – delivering results
− Cost realignment to simplify and leverage scale
Pivot to growth
− Aftermarket and expanding industrial applications
− Dynamic resource allocation to growth regions & markets
− Drive innovation – new products & IoT advantage
Strengthen the portfolio
− Bolt-on acquisitions leverage technology and channel
− Adjacency acquisitions expand technology and markets
− New platforms broaden, diversify portfolio
3-5 Year Objectives
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Markets Near Bottom of Cycle
Current Environment
• Sluggish as customers minimize
expenses
• Lower power utilization rates in
the US and China
• NA welding stabilizing
sequentially; Europe flat
• Environmental spend starting in
China
• Lower capex spending YOY
• Current projects progressing but
few new projects
• Policy changes in China slow
new build, accelerate environ.
• Steady pace in SEA
• New regulations in India
Aftermarket
General
Industrial
Oil & Gas
Power
Source: Internal company management estimates.
Order Indicators
• Increasing oil prices
• Maintenance deferments
already in comps
• Aging power fleet in China
• Stable to up global PMI
• GDP forecast uptick in ’17
• Increasing oil prices
• Refinery utilization
• Refined products demand
• Thermal power generation
announced projects
• Utilization
• Announced regulations
STABLE OUTLOOK BUT NO MARKET UPTICK EXPECTED BEFORE SECOND HALF 2017
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2017 Expectations
Flat to down (2)% organic revenue
Sales quarterly seasonality: 22-23%, 25-26%, 24-25%, 27-28%
+7% adjusted EPS growth at mid-point
Driven by $50 million of structural cost reductions
Partially offset by $5 to $10 million of growth investments and
inflation, net of productivity
Approximately $35M of interest expense
Strong free cash flow conversion
2017 2016
$1.50-$1.55 $1.55-$1.70
FINANCIAL SCHEDULE
9
Non-GAAP Reconciliation
(Unaudited)
Note: Guidance as of 12/16/16.
2017 EPS Range
Projected net income per share – diluted $1.29 $1.44
Restructuring costs 0.36 0.36
Tax Adjustment (0.10) (0.10)
Projected adjusted net income per share - diluted $1.55 $1.70
Colfax has provided financial information in this presentation that has not been prepared in accordance with GAAP. The
non-GAAP financial measure of adjusted net income per share excludes restructuring charges. This non-GAAP financial
measure assists Colfax in comparing its operating performance on a consistent basis by removing the impact of charges
associated with major restructuring programs.