Emerson Overview
May 2024
Safe Harbor Statement
Statements in this presentation and our commentary and responses to questions that are not strictly historical may be "forward-looking" statements, which involve risks and uncertainties, and Emerson undertakes no obligation to update any such statements to reflect later developments. These risks and uncertainties include the scope, duration and ultimate impacts of the Russia-Ukraine and other global conflicts, as well as economic and currency conditions, market demand, pricing, protection of intellectual property, cybersecurity, tariffs, competitive and technological factors, inflation, among others, as set forth in the Company's most recent Annual Report on Form 10-K and subsequent reports filed with the SEC. The outlook contained herein represents the Company's expectation for its consolidated results, other than as noted herein.
Non-GAAP Measures
In this presentation we will discuss some non-GAAP measures in talking about our company's performance, and the reconciliation of those measures to the most comparable GAAP measures is contained within this presentation or available at our website, www.Emerson.com, under Investors.
Continuing Operations
All financial metrics in this presentation are on a continuing operations basis, unless otherwise noted.
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Emerson Overview
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Leading the
Future of
Automation
LIFE | RENEWABLES & | GREEN |
SCIENCES | ENERGY STORAGE | HYDROGEN |
Emerson's strong portfolio of technology and software provide innovative automation solutions for the world's essential industries.
25 of the top 25 life sciences | Emerson systems control 60,000 | Emerson valves and measurement |
companies use Emerson software, | wind turbines globally | devices automate one of the world's |
control systems, and intelligent devices | largest green hydrogen facilities | |
SEMICONDUCTOR | POWER GENERATION | ELECTRIC VEHICLES |
9 of the top 10 semiconductor | 50% of North America power | 69% of electric vehicles in 2023 |
manufacturers use Emerson | generation is automated using | were produced using Emerson |
intelligent devices and controls | Emerson control systems and | technology |
software (20% globally) | E M E R S O N | 4 |
Strong Operational Performance Focused on Value Creation
KEY MESSAGES
Current End-Market Demand
Process and hybrid markets continue to exhibit favorable demand while discrete markets are expected to begin turning positive in H2 2024
ATTRACTIVE OPPORTUNITIES AHEAD
Secular Growth Drivers
Differentiated portfolio supporting digital transformation, energy security & affordability, nearshoring and sustainability & decarbonization
Winning in Growth Markets
Driving growth in our growth platforms (energy transition, industrial software, diversified discrete & hybrid end markets)
Innovation Opportunities
Wave of new products focused on solving customers' sustainability and digital challenges
2024 Focus on Execution and Integration
Closed the sale of Copeland and completed two strategic bolt-on acquisitions in 2023; NI acquisition closed in October 2023, largely completing portfolio transformation
Test & Measurement Ahead of Plan
H1 exceeded expectations; Expecting $0.40 - $0.45 of full year adjusted EPS contribution; Accelerated and increased synergy plan savings to $185M in year 3, with $100M to be realized in 2024
Portfolio Evolution Driving Synergies
Realizing synergies from inorganic investments and recognizing value from cohesive, diversified portfolio
Operational Excellence
Top-quartile performance and execution driven by Emerson Management System
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Why Emerson
Leading technology and software portfolio exposed to critical secular trends and attractive growth markets
Track record of strong operational performance and leading margins using differentiated Emerson Management System
History of innovation and market disruptions resulting in market-leadingsolutions and products
World-classM&A philosophy enables expansion into growth markets and diversification opportunities
Strong balance sheet and clear capital allocation framework including returning capital to shareholders
Resilient and experienced leadership team focused on attracting and retaining the best talent
Differentiated financial framework of 4 - 7% through-the-cycle organic growth, double-digit Adj. EPS growth and 15 - 18% free cash flow margin
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Global Automation Leader With Diversified End-Market Exposure
$17B
Net Sales
~13%
Software % Of Sales
GEOGRAPHY
20%
Europe
30%
Asia, Middle
East & Africa
50%
Americas
>50%
Gross Profit
>60%
MRO / Recurring Revenue
END-MARKET
16% | 21% |
Other | |
Energy | |
17%
General
Industries
17%
8%Discrete
Hybrid | 12% |
9% | |
Power & | Chemical |
Renewables |
~25%
Adjusted Segment EBITA
~$150B
Installed Base
SEGMENT
6% AspenTech
10%
24% | Test & Measurement |
Final Control
15%
Control Systems
& Software
21% | 8% | ||||
Measurement | Safety & | ||||
& Analytical | 16% | Productivity | |||
Discrete Automation | |||||
Intelligent Devices | Software & Control | ||||
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Note: Figures above represent 2023 Emerson as-reported in addition to an annualized NI (Test & Measurement) on an Emerson basis
World-class Automation Portfolio for Process, Hybrid and Discrete Industries
OPTIMIZE | SOFTWARE | |
Modeling & AI-Powered software to design, optimize and maintain operations for maximum performance
DECIDE
Control Systems for intuitive and automated plant process control to maximize quality, efficiency and safety
ACT
Precision Control to ensure safe, responsive operations by controlling flow of liquids and gases
SEE
Sensing & Measurement to measure and collect critical process data to optimize insight and decision making
CONTROL
INTELLIGENT DEVICES
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Emerson's Value Creation Framework
Organic Growth
Accelerating innovation and aligning with secular growth trends
Portfolio Management
Building a higher growth, cohesive automation portfolio
Operational Excellence
Continuing our long tradition of delivering margin and cash performance
THROUGH-THE-CYCLE TARGETS
4 - 7%
Through-The-Cycle Organic Growth
~35%
Incremental Margins
Double-Digit
Adjusted EPS Growth
15 - 18%
Free Cash Flow Margin
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Organic Growth Platforms
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Disclaimer
Emerson Electric Co. published this content on 10 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 May 2024 21:41:49 UTC.