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nVent Electric — Presentation PDF (company IR deck)
nVent Electric (NVT) · 118 slides · Filed Oct 30, 2026
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Slide 1 — 2018 nVent Investor and Analyst Day
2018 nVent Investor and Analyst Day New York City February 13, 2018 5/3/2018
Slide 2 — Welcome
Welcome J.C. Weigelt Vice President Investor Relations
Slide 3 — Agenda for Today
Estimated Time Topic Speaker 1:00pm Welcome J.C. Weigelt 1:05pm Opening Remarks Randall Hogan 1:10pm Overview of nVent Beth Wozniak 1:35pm Growth Strategy Ben Sommerness 1:50pm Overview of Enclosures Joe Ruzynski 2:05pm Overview of Thermal Management Brad Faulconer 2:20pm Overview of Electrical & Fastening Solutions Robert van der Kolk 2:35pm Investment Thesis and Financial Outlook Stacy McMahan 2:50pm Break 3:00pm Q&A 3 February 13, 2018 nVent Investor Day Agenda for Today
Slide 4 — Forward-Looking Statements
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS This presentation contains statements that we believe to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact are forward-looking statements. Without limitation, any statements preceded or followed by or that include the words "targets," "plans," "believes," "expects," "intends," "will," "likely," "may," "anticipates," "estimates," "projects," "should," "would," "positioned," "strategy," "future" or words, phrases or terms of similar substance or the negative thereof, are forward-looking statements. All projections in this presentation are also forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond our control, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include the ability to satisfy the necessary conditions to consummate the planned separation of our Electrical business and the Water business of Pentair plc into two independent, publicly- traded companies (the "Proposed Separation") on a timely basis or at all; the ability to successfully separate our business and realize the anticipated benefits from the Proposed Separation; adverse effects on our business operations or financial results as a result of the announcement or consummation of the Proposed Separation; unanticipated transaction expenses, such as litigation or legal settlement expenses; failure to obtain tax rulings or changes in tax laws; changes in capital market conditions; the impact of the Proposed Separation on our employees, customers and suppliers; overall global economic and business conditions impacting our businesses; the ability of our business to operate independently following the Proposed Separation; the ability to achieve the benefits of our restructuring plans; the ability to successfully identify, finance, complete and integrate acquisitions; competition and pricing pressures in the markets we serve; the strength of housing and related markets; volatility in currency exchange rates and commodity prices; inability to generate savings from excellence in operations initiatives consisting of lean enterprise, supply management and cash flow practices; increased risks associated with operating foreign businesses; the ability to deliver backlog and win future project work; failure of markets to accept new product introductions and enhancements; the impact of changes in laws and regulations, including those that limit U.S. tax benefits; the outcome of litigation and governmental proceedings; and the ability to achieve our long-term strategic operating goals. Additional information concerning these and other factors is contained in our filings with the SEC, including our Registration Statement on Form 10. All forward-looking statements speak only as of the date of this presentation. nVent Electric plc assumes no obligation, and disclaims any obligation, to update the information contained in this presentation. The officer titles for individual speakers set forth in this presentation are the titles such persons are expected to have at nVent Electric plc after the completion of the Proposed Separation. 2 4 Forward-Looking Statements February 13, 2018 nVent Investor Day
Slide 5 — Key Definitions
• Except as Otherwise Noted, All References to nVent and All Amounts Included Herein Represent the Pentair Electrical Business Excluding the Pentair Water Business • "Core Sales" Refers to GAAP Revenue from Continuing Operations Excluding (1) the Impact of Currency Translation and (2) the Impact of Revenue from Acquired Businesses Recorded Prior to the First Anniversary of the Acquisition Less the Amount of Sales Attributable to Divested Product Lines Not Considered Discontinued Operations • "Adjusted Core Sales" Represents "Core Sales" Excluding the Impact of Large Jobs Within our Thermal Management Business • Segment Income Represents Equity Income of Unconsolidated Subsidiaries and Operating Income from Continuing Operations Exclusive of Non-Cash Intangible Amortization, Certain Acquisition Related Expenses, Costs of Restructuring Activities, "Mark-to-Market" Gain (Loss) for Pension and Other Post-Retirement Plans, Impairments, and Other Unusual Non-Operating Items • Return on Sales ("ROS") Equals Segment Income Divided by Sales • See Appendix for GAAP to Non-GAAP Reconciliations 5 Key Definitions February 13, 2018 nVent Investor Day
Slide 6 — Opening Remarks
Opening Remarks Randall Hogan Chairman, nVent
Slide 7 — SUSTAINABILITY
7 Separation into Two Publicly-Traded Companies Industry-Leading, Pure-Play Companies; Strong Brands & Financial Profiles WATER ELECTRICAL A Leading Global Water Treatment Company Focused on Smart, Sustainable Water Solutions A High-Performance Electrical Company Focused on Connecting and Protecting our Customers with Inventive Electrical Solutions 2017 Revenue: ~$2.1B 2017 ROS: ~19%* 2017 Revenue: ~$2.8B 2017 ROS: ~17%* SUSTAINABILITY Maximizing the Use of the Resources People Rely on Most Connecting & Protecting Critical Processes, People, and the Environment CONNECTION & PROTECTION February 13, 2018 nVent Investor Day *Includes allocated corporate costs
Slide 8 — Rationale of Separation
8 The Next Step in the Evolution of Pentair Rationale of Separation RATIONALE FOUNDATION STRATEGIC FOCUS Improved Clarity into Performance and Growth Opportunities CAPITAL ALLOCATION FLEXIBILITY Unique Strategies to Deliver Growth for Each FINANCIAL STRENGTH Supports Plan to be Successful, Profitable, and Sustainable PIMS Pentair’s “Business System” MANAGEMENT TEAM Mix of Current & New Executives and Board Members to Lead CAPITAL STRUCTURE Expect Strong Balance Sheet and Financial Positioning February 13, 2018 nVent Investor Day
Slide 9 — nVent Overview
nVent Overview Beth Wozniak Chief Executive Officer
Slide 10 — secure world. We connect and protect our customers
At nVent, we believe that safer systems ensure a more secure world. We connect and protect our customers with inventive electrical solutions.
Slide 11 — The Road to nVent
Confidential & Proprietary The Road to nVent A Name that Reflects Our History and Our Future Erico Founded 1900s 1940s 1950s 1960s 1970s 1980s 1990s 2000s Hoffman Engineering Launched Raychem Founded Schroff Founded Tracer Founded Hoffman Acquisition Schroff Acquisition 2010s Raychem & Tracer Acquisition (Tyco) Erico/Caddy Acquisition Caddy Launched February 13, 2018 nVent Investor Day 11
Slide 12 — Performance History
12 Performance History 4x Sales and nearly Doubled ROS…Profitable, Scaled Electrical Business 1996 2007 2017 Sales ($M) ROS ~19% ~10% February 13, 2018 nVent Investor Day ~$550M ~$1.1B ~$2.1B ~15% ~$550M
Slide 13 — Diversified Portfolio with Strong Financials
13 Diversified Portfolio with Strong Financials High Performance Electrical Company Focused on Connection & Protection Industrial Company Characteristics Verticals Segments Geographies US & Canada 65% Western Europe 22% Developing 11% Other Developed 2% 45% Infrastructure 12% Enclosures 44% Thermal Management 30% Electrical & Fastening Solutions 26% Commercial & Residential 27% Energy 16% Industry-leading positions and strong brands Focused on improving utilization, lowering costs and maximizing customer uptime Attractive margin profile Strong free cash flow generation 2017 Financials ~19% ROS ~$2.1B Revenue February 13, 2018 nVent Investor Day
Slide 14 — 14
14 Industry Leading Positions Premier Brands Recognized for Innovation, Quality and Reliability • A global leader in electric heat tracing solutions • A global leader in complete heat management systems • A global leader in electrical and fastening solutions • A leader in North American industrial enclosures • A leader in European electronic protection February 13, 2018 nVent Investor Day We are a Leader in Connection and Protection
Slide 15 — nVent has Mission-Critical Solutions That Create Value
Our Value and Differentiation Drive Customer Loyalty Our products… • Connect and protect across broad range of applications • Meet stringent regulatory standards and certifications Our products… • Protect equipment and electronics in hazardous environments • Help avoid the high cost of failure Hazardous Location Cooling Reduced facilities operating costs by ~75% Our products… • Reduce labor cost in installation • Improve utilization • Minimize downtime • Reduce total cost of ownership Rail Surge Protection Mission-Critical Solutions High Cost of Failure Customer Productivity & Total Cost of Ownership Stainless Steel Enclosures Purge and Pressurizatio n Systems nVent has Mission-Critical Solutions That Create Value 15 February 13, 2018 nVent Investor Day
Slide 16 — nVent Leadership Team
16 nVent Leadership Team New Leadership Team in Place BETH WOZNIAK Chief Executive Officer TOM PETTIT EVP & Chief Integrated Supply Chain Officer JOE RUZYNSKI President Enclosures BRAD FAULCONER President Thermal Management STACY McMAHAN EVP & Chief Financial Officer LYNNETTE HEATH EVP & Chief Human Resources Officer JON LAMMERS EVP, General Counsel & Secretary BEN SOMMERNESS EVP, Chief Growth & Strategy Officer ROBERT Van der KOLK President EFS February 13, 2018 nVent Investor Day
Slide 17 — The nVent Strategy
Drive Productivity & Velocity The nVent Strategy 17 One nVent Focus on Attractive Verticals Accelerate Innovation & Connected Solutions Grow Globally & in Developing Regions Pursue Targeted Bolt-on Acquisitions February 13, 2018 nVent Investor Day
Slide 18 — Macro Trends are Favorable
18 Macro Trends are Favorable Trends Drive use of More Electrical Products Demographic Shifts Technology & Connectivity Electrification & Urbanization Safety & Security February 13, 2018 nVent Investor Day
Slide 19 — Digitizing the Customer Experience
19 One nVent Customers Channels Capability Digital Scale Aligned Go to Market Teams for Key Verticals Key Partnerships and Account Management Commercial Excellence Digitizing the Customer Experience Common Processes & Systems February 13, 2018 nVent Investor Day
Slide 20 — Focus on Attractive Verticals
20 Focus on Attractive Verticals Global Synchronous Growth in 2018 2018 Macro Outlook Commercial & Residential (27% of Sales) Industrial (45% of Sales) Energy (16% of Sales) Infrastructure (12% of Sales) Growth Focus • Lower cost of ownership and installation • Specification selling • Global new products • New products, global focus • Connected solutions & digital tools • MRO focus • Connected solutions • New products • Aligned go to market and key account penetration • New products February 13, 2018 nVent Investor Day
Slide 21 — Accelerate Innovation and Connected Solutions
21 Accelerate Innovation and Connected Solutions Innovative and Connected Solutions Addressing Unmet Needs • Unique low-smoke, halogen- free, and flame-retardant insulation • Reduces Total Installed Cost • Improves safety and reliability Thermal Commercial Controller Advanced Flexible Busbar Thermal Industrial Controller Integrated Liquid Cooling Solutions • Safe and reliable temperature control • Connected controls and monitoring solutions • Advanced connected controls platform for heat tracing and leak detection • Building Management System connectivity • Differentiated air to water & water to water high density heat exchangers • Critical need in datacenters for high density heat loads February 13, 2018 nVent Investor Day
Slide 22 — Grow Globally and in Developing Regions
22 Grow Globally and in Developing Regions Global Footprint Supports Global Growth Manufacturing Facilities • Developed Regions: Accelerate product coverage and penetration • Developing Regions: Enhance local capabilities and localized solutions • Localizing products • Increasing global design capability February 13, 2018 nVent Investor Day
Slide 23 — Drive Productivity and Velocity
23 Drive Productivity and Velocity Drive Productivity and Velocity Our Solid Foundation Lean Enterprise • Standard Work • Creating Flow • Strategy Deployment Digitization Standardization • ERP Systems • Processes Lean Enterprise • Lean Information Flow • Integrated Supply Chain Digital Transformation • Enterprise-wide platforms • Digital customer experience Continue Standardization • Across all processes Accelerating Performance February 13, 2018 nVent Investor Day
Slide 24 — nVent Values
24 nVent Values Living our Values is Fundamental to Achieving Our Goals Retain our Win Right Values and Culture February 13, 2018 nVent Investor Day
Slide 25 — spark
Evolution of Our Management System Building on a Strong Foundation PIMS Foundation Introducing spark PENTAIR INTEGRATED MANAGEMENT SYSTEM Rapid Growth Process 3D Innovation Commercial Excellence Talent Mgmt. Org. Development “Win Right” Values Standard Work Creating Flow Strategy Deployment Growth Talent Lean Enterprise Growth People Lean Enterprise Velocity Digital spark February 13, 2018 nVent Investor Day 25
Slide 26 — The 5 elements of Spark
26 The 5 elements of Spark Growth People Lean Enterprise Velocity Digital Growth Mindset, Commercial Excellence Energize Employees & Create Value Lean Information Flow Drive Velocity in Everything We Do Digitize the Customer Experience, Products and Processes February 13, 2018 nVent Investor Day
Slide 27 — Enclosures
27 Key Priorities by Segment Focused Growth Globally • Grow Industrial and Infrastructure • Expand margins via productivity and price • Digitize customer experience Enclosures • Grow Industrial, Commercial and Infrastructure • Focus on Industrial MRO • Launch new products and connected solutions Thermal Management • Grow Commercial and Infrastructure • Launch new products and solutions • Expand margins via productivity and price Electrical & Fastening Solutions February 13, 2018 nVent Investor Day
Slide 28 — Drive Disciplined Capital Allocation
28 CEO Priorities Set up nVent as a Separate Public Company Drive Organic Growth Expand Margins via Productivity and Velocity Continue Strong Cash Flow Drive Disciplined Capital Allocation February 13, 2018 nVent Investor Day
Slide 29 — Long-Term Financial Framework
Long-Term Financial Framework Long-Term Value Creation Goals Differentiated growth 1-2% above GDP Margin Expansion Top Tier Performance Free Cash Flow = 100% Adjusted Net Income Long-Term Goals 29 Revenue Segment Income EPS Cash Flow February 13, 2018 nVent Investor Day
Slide 30 — Key Takeaways
30 Key Takeaways Building a High Performance Growth Company We are a Leader in Connection and Protection February 13, 2018 nVent Investor Day • We have industry leading positions in growing verticals • We have attractive segments with differentiated growth opportunities • We have a clear strategy and are focused on driving organic growth • Our One nVent approach can accelerate performance
Slide 31 — Countdown to Target Spin Date ~ 76 Days, 19 hours, 55
Countdown to Target Spin Date ~ 76 Days, 19 hours, 55 min. February 13, 2018 nVent Investor Day 31
Slide 32 — Growth Strategy
Growth Strategy Ben Sommerness Chief Growth & Strategy Officer
Slide 33 — nVent’s Verticals are Attractive and Growing
33 nVent’s Verticals are Attractive and Growing Solid Vertical Growth and nVent Position Characteristics Verticals Total Addressabl e Size ($B) Expected Growth Commercial & Residential ~22 ~3% Industrial ~18 ~4% Infrastructure ~11 ~4% Energy ~9 ~3% Total ~60 ~3-4% • Large, attractive verticals • Strong fundamentals accelerating growth – Technology/Connectivity – Electrification/Urbanization – Demographic Shifts – Safety and Security • Good mix across verticals • Many leadership positions • Lots of opportunity, globally February 13, 2018 nVent Investor Day
Slide 34 — We Have a Leading Portfolio of Electrical Products
34 We Have a Leading Portfolio of Electrical Products Thermal Management ($622M) Enclosures ($935M) Electrical & Fastening Solutions ($541M) Equipment Protection Building Infrastructure Solutions Industrial Heating Solutions Electronics Protection Fastening Solutions Electrical Solutions 2017 Revenue by Segment February 13, 2018 nVent Investor Day
Slide 35 — Unifying Our Strong Brands Under nVent
35 Unifying Our Strong Brands Under nVent A “Branded House” That Better Enables Portfolio Selling 1966 1988 1994 2012 2015 2018 February 13, 2018 nVent Investor Day
Slide 36 — The nVent Strategy
Drive Productivity & Velocity 36 The nVent Strategy One nVent Focus on Attractive Verticals Accelerate Innovation & Connected Solutions Grow Globally & in Developing Regions Pursue Targeted Bolt-on Acquisitions February 13, 2018 nVent Investor Day
Slide 37 — Drive “One nVent” via Commercial Excellence Framework
37 Growth Mindset…With Rigorous Execution to Deliver on Commitments February 13, 2018 nVent Investor Day Drive “One nVent” via Commercial Excellence Framework Developing Addressing Executing Growing Market & Customer Insights Market Analysis Product Management Commercial Effectiveness Strategy Development Value Creation & Pricing Demand Generation Innovation Branding & Communication Selling Service & Support 1 2 3 4 5 6 7 8 9 10 11 Near-Term Priorities to Drive Growth • Product Management • Customer Insights • Innovation Velocity • Strategic Pricing • Commercial Effectiveness
Slide 38 — “One nVent” - Pursuing a Digital Strategy to Enable
38 “One nVent” - Pursuing a Digital Strategy to Enable Growth • Focus in 2018 – New web site – CRM launch – Product data – Configurators • Transformation over time – 2018 – 2019 Digitize the Core – 2020 – 2021 Digital End-to-End – 2021+ World Class Customer Experience Business strategy Digitize Go-To-Market Connected Solutions Digitize Operations Digitize Support Functions Accelerators (People, Technology, Analytics) February 13, 2018 nVent Investor Day
Slide 39 — Configurators Allow Better Customer Experience
39 Configurators Allow Better Customer Experience Connecting Our Customers to Create Value • Enhancing the customer experience • Driving velocity by simplifying processes • Expanding configurator capability to more product lines Design Your Electronics Cabinet or Front Panel in Minutes! Digital Example: Schroff Configurator February 13, 2018 nVent Investor Day
Slide 40 — Attractive Verticals - Infrastructure
40 Attractive Verticals - Infrastructure Coordinated Approach to Drive Infrastructure Opportunities • Infrastructure is a large, global vertical with attractive growth – ~$11B, ~4% growth • DataCom & Networking Solutions (DNS) is one key growth opportunity • Increase DNS sales via: – Dedicated enterprise team – Selling solutions – Building on strong relationships – Bring global differentiation Racks & Accessories Cable Pathways Cooling Grounding DataCom & Networking Solutions February 13, 2018 nVent Investor Day
Slide 41 — Attractive Verticals - Commercial
Thermal Management Cable Management Fire Protection Seismic Protection Lightning Protection DNS • Commercial vertical is large and growing – ~$22B, ~3% growth • Increase Commercial sales via: – Dedicated enterprise leader – Project pipeline expansion – Specification selling – Clear value propositions – Collaboration across nVent – Aligned channel to deliver 41 Attractive Verticals - Commercial Commercial Building February 13, 2018 nVent Investor Day
Slide 42 — Accelerate Innovation - 3D Process for Organic Growth
42 Accelerate Innovation - 3D Process for Organic Growth Process Bearing Fruit, But Much More to Come Deploy Execute Launch Develop Optimize & Validate Design Discover Identify, Evaluate & Prioritize • Established, robust process driving velocity – Vitality up 25% since 2015 • Increasing investment with focus on ‘bigger’ ideas – Technology differentiation – Better VOC, tools, and training – Continued 3D rigor • Expect strong new product sales contribution – ~50 launches in 2018 – Target ~20% vitality longer term 3D Product Development Process February 13, 2018 nVent Investor Day
Slide 43 — Growth Globally and in Developing Regions
43 February 13, 2018 nVent Investor Day Growth Globally and in Developing Regions Sell Our Existing Portfolio…Globally! • Approach: – Align nVent, go-to-market approach – Product & manufacturing localization – Expanded in-region marketing – Broader channel partnerships – Prioritize, such as Silk Road • Approach: – Vertical growth initiatives – Segment coordination – Sell existing portfolio – Innovative solutions – Aligned channel partnerships • Growth Examples: – ERIFLEX FLEXIBAR busbar in U.S. – CADDY fasteners in Europe – RAYCHEM XL-TRACE heat trace Developing Regions Developed Regions
Slide 44 — Key Takeaways
44 Key Takeaways nVent is Poised for Strong Growth • nVent is in attractive, growing verticals • We have strong, well-positioned brands and products • We are unifying under One nVent to drive portfolio growth • nVent has an exciting future with a clear, focused strategy • Underpin growth with commercial excellence velocity February 13, 2018 nVent Investor Day
Slide 45 — Enclosures
Enclosures Joe Ruzynski President, Enclosures
Slide 46 — What You Will Hear Today
46 What You Will Hear Today Positioned to Drive Growth and Expand Margin • Enclosures is growing and is well positioned to grow − Strong brands positioned well in favorable verticals − Sustainable competitive advantages • We expect to grow by: − Driving growth in Industrial and Infrastructure verticals − Supporting the transformation in our channel and digitizing our front end − Growing in Developing Regions • We plan to expand margins by: − Driving productivity and lean in our newly expanded footprint − Optimizing price − Leveraging digital and increasing velocity February 13, 2018 nVent Investor Day
Slide 47 — $935M
Other Developed 11% We provide innovative solutions that protect, connect, and manage heat in critical electronics, communication, control, and power equipment. Who We Are: Enclosures Description 2017 Financials Verticals Geographies US & Canada 69% Western Europe 18% Developing 1% Industrial 60% Energy 11% Infrastructure 19% Commercial 10% $935M Revenue ~17% ROS 47 February 13, 2018 nVent Investor Day
Slide 48 — We Connect and Protect Critical Controls and
We Connect and Protect Critical Controls and Components 48 Hazardous Location Enclosures Modular Enclosure Solutions Industrial Cooling Server Cabinets Data Center Solutions Power Supplies Subracks and Cases Equipment Protection Electronic Protection February 13, 2018 nVent Investor Day Industrial controls and automation Oil & gas controls Food and beverage Commercial construction Data centers & networking Rail signaling and control Test and measurement Aerospace and defense Data centers & networking
Slide 49 — Did you know?
49 Did you know? Providing Innovative Solutions for More Than 70 Years • More than 30 million nVent enclosures are in use around the globe today • Our 4X stainless steel enclosure with POWERGLIDE handle withstood hurricane flooding for four days • Data centers with high heat densities are deploying nVent closed loop cooling systems globally • nVent backplanes provide millions of passengers a pleasant inflight entertainment experience February 13, 2018 nVent Investor Day
Slide 50 — Key 2018+ Priorities to Support nVent Strategy
• Strategic channel partnerships • Digitize customer experience Key 2018+ Priorities to Support nVent Strategy 50 One nVent Focus on Attractive Verticals Stabilize Performance & Strengthen Margin Grow Globally & in Developing Regions 1 3 4 2 • Accelerate in higher growth DNS • Global industrial expansion • Flow capital to best opportunity • Partnered distribution model • Value based pricing • Streamlined offering in growth regions • Localization of design • Globally serve key OEMs February 13, 2018 nVent Investor Day
Slide 51 — Well Positioned to Continue Capturing Macro Trends
Well Positioned to Continue Capturing Macro Trends Demographi c Shifts Electrification & Urbanization Industrial & Infrastructure Investments in Developing Regions Increased Data Needs … Everywhere Remote Monitoring, Predictive Maintenance Macro-Trends Example Sub-Trends Channel Velocity and Value Add Broad Footprint and Portfolio Leading Data, Networking, and Cooling Solutions Connected Cooling and Power Segment Implications Configurator and Modification Solutions Technology & Connectivity Safety & Security February 13, 2018 nVent Investor Day 51
Slide 52 — Enclosures Has Strong Competitive Advantages
Enclosures Has Strong Competitive Advantages 52 Strong Brand Recognition Technical Expertise Customized Products and Solutions Broad Product Offering and Availability • Deep history in our Hoffman and Schroff brands and reputation for quality and reliability • Specialized engineering and testing expertise enables ability to deliver high performance, lower cost designs • Ability to tailor products and provide innovative solutions to meet complex customer requirements • Broad enclosure, cooling, and accessory product offering • Strong availability through global channel February 13, 2018 nVent Investor Day
Slide 53 — Differentiated Solutions Driving Customer Value
Customer needs: Harsh environments cause “general purpose” products to fail • Rusting and corrosion • Equipment failures • Down time • Lost revenue • Incremental expense Differentiated Solutions Driving Customer Value 53 SPECTRACOOL air conditioners with Advanced Corrosion Protection • Differentiated corrosion protection solution • Implemented at Leading Tire Manufacturer for a 24 month pilot • Strong results at customer: • Uptime improvement of ~500% • Cost savings of ~$1.4m Smart - Remote Monitoring of Air Conditioners Extends Life Testimonial: “Production can run more smoothly without worrying about downtime since we introduced protected AC units and remote monitoring.” February 13, 2018 nVent Investor Day
Slide 54 — Using Digital to Improve the Customer Experience
Using Digital to Improve the Customer Experience Setting the Base for Digital Transformation • Improve customer’s digital journey with flexible search and collaborative design tools • Provide better customer service through quick quoting, fast fulfillment, order tracking and online support • Support channel’s effort to add value by integrating with their sites EASY SEARCH CONFIGURE & PRICE FULFILL & TRACK VELOCITY February 13, 2018 nVent Investor Day 54
Slide 55 — Driving Growth With New Products
Driving Growth With New Products Strong Pipeline, Well Positioned for Growth PROTECTING PEOPLE CONTRACTOR INNOVATION Product: Internal Disconnect Shield Customer Need: Reduce risk of electric shock and arc flash Differentiating features: − Open back with holes for easy mounting − Door stop to prevent incidental contact − Automatic latching Product: Angled Trough Customer Need: Cut total installation time by the elimination of costly 90-degree conduit bends Differentiating features: − Angled design allows pulls through front and eliminates need for conduit bends − Simple cover design for up to 80% installation labor savings February 13, 2018 nVent Investor Day 55
Slide 56 — Improving Performance and Margin Expansion
56 Improving Performance and Margin Expansion Path to Margin Expansion and Improved Customer Experience Investment Past: 2015-2017 Capacity Expansion Factory Consolidation New Distribution Center Automation Stabilization and Growth Execution Today: 2018 Integrated Supply Chain Logistics Optimization Digital Front End Pricing Growth and Lean Enterprise Acceleration Future: 2019-2022 Supply Chain Velocity Digital End to End Improved Customer Experience Growth and Margin Expansion February 13, 2018 nVent Investor Day
Slide 57 — Enclosures Financial Overview
57 Enclosures Financial Overview Accelerating Growth and Expanding Margins in the Second Half of 2018 Revenue ($M) ROS $959 $911 $935 2015 2016 2017 2018 Outlook 21% 20% 17% 2015 2016 2017 2018 Outlook • Improve the customer experience • Drive growth in key verticals • Introduce innovative products • Grow in developing regions • Optimize pricing • Drive productivity and lean • Remove complexity • Leverage digital ~Flat +4-6% February 13, 2018 nVent Investor Day
Slide 58 — Key Takeaways
58 Key Takeaways Positioned to Drive Growth and Expand Margin February 13, 2018 nVent Investor Day • Enclosures is growing and is well positioned to grow − Strong brands positioned well in favorable verticals − Sustainable competitive advantages • We expect to grow by: − Driving growth in Industrial and Infrastructure verticals − Supporting the transformation in our channel and digitizing our front end − Growing in Developing Regions • We plan to expand margins by: − Driving productivity and lean in our newly expanded footprint − Optimizing price − Leveraging digital and increasing velocity
Slide 59 — Thermal Management
Thermal Management Brad Faulconer President, Thermal Management
Slide 60 — What You Will Hear Today
60 What You Will Hear Today Differentiated Solutions Positioned for Growth • Our Thermal Management segment has improved profitability and we believe is positioned for sustained growth − Highly differentiated products and solutions − Diversified to capitalize on key global trends • We expect to grow by: − Launch of new products & software − Delivering Vertical growth in Industrial, Commercial and Infrastructure − Expanding regional presence through localization • We plan to expand margins by: − Driving productivity, pricing and velocity February 13, 2018 nVent Investor Day
Slide 61 — $622M
Other Developed 14% We provide electric thermal solutions that connect and protect people, critical infrastructure, industrial processes and buildings. Who We Are: Thermal Management Description 2017 Financials Verticals Geographies US & Canada 55% Western Europe 29% Developing 2% Industrial 43% Energy 31% Commercial & Residential 26% $622M Revenue ~24% ROS 61 February 13, 2018 nVent Investor Day
Slide 62 — A Global Leader in Thermal Management Solutions
A Global Leader in Thermal Management Solutions 62 Industrial Heating Solutions Building & Infrastructure Solutions Pipe freeze protection Process temperature maintain Pipeline heating Tank & vessel heating Heat Tracing for Plant Piping & Vessels Heating System Components Control, Monitoring & Sensing Turnkey Services Heat Tracing for Pipes & Surfaces Floor Heating Cables & Mats Thermostats, Controls Fire Rated Wiring Cables Snow melting & de-Icing Radiant floor warming Liquid leak detection Life safety power cables February 13, 2018 nVent Investor Day
Slide 63 — Did you know?
63 Did you know? Thermal Management Connects and Protects Around the World The world’s longest heated pipeline in India uses Raychem heating technology, engineered by Tracer New York High Rise buildings use Raychem heating technology for efficient hot water design for instant hot water on every floor Inventor of Self-Regulating Heating Cables with more than a Billion Feet installed worldwide February 13, 2018 nVent Investor Day
Slide 64 — Key 2018+ Priorities to Support nVent Strategy
• Strategic channel partnerships • Digitize the customer experience Key 2018+ Priorities to Support nVent Strategy 64 One nVent Focus on Attractive Verticals Product Innovation to Capitalize on Attractive Global Trends Grow Globally & in Developing Regions 1 3 4 2 • Industrial MRO • Commercial & Infrastructure • Smarter, IoT enabled products • Fire, Safety and Sustainability • Flow Assurance • Build local commercial capability • Regionalization of products February 13, 2018 nVent Investor Day
Slide 65 — Well Positioned to Continue Capturing Macro Trends
Well Positioned to Continue Capturing Macro Trends Demographi c Shifts Electrification & Urbanization Technology & Connectivity Safety & Security Macro-Trends Connected Solutions Sustainability Enhanced Fire and Life Safety Standards Segment Implications Regional Expansion & Localization Differentiated Solutions Connected: Heat Trace Control & Monitoring Flow Assurance Sustainability: Systems for Energy & Water savings in Buildings Safety: Anti-icing for Ships and Offshore Platforms, De-icing for Buildings Flow Assurance: Protecting Critical Pipelines Fire: Life Safety Circuits February 13, 2018 nVent Investor Day 65
Slide 66 — Thermal Has Strong Competitive Advantages
Thermal Has Strong Competitive Advantages 66 Strong Brand Recognition Technical Expertise Complete Solutions Ease of Installation and Reduced Total Cost • History of innovative and high-quality products & services • Specialized engineering expertise for optimized solutions • Offer one-stop shop from products to complete installations • Highly Reliable solutions that lower total cost of ownership February 13, 2018 nVent Investor Day
Slide 67 — Differentiated Solutions Driving Customer Value
Differentiated Solutions Driving Customer Value 67 TracerLynx Platform: • Single database heat management design software • Imports electronic piping files and specs • Powerful design optimization and change management Thermal Management 3D Design & Optimization Software Customer Results: • Heating & Insulation optimization resulting in significant power load reduction • Power distribution savings from reduced power cable and cable tray • Customer case studies support 1% in overall Heat Management System savings February 13, 2018 nVent Investor Day
Slide 68 — Driving Growth With New Products
Driving Growth With New Products Strong Pipeline, Well Positioned for Growth Innovation in Heating Technology Innovation in Connected Controls • Product: Raychem Control & Monitoring • Customer Need: Ease of use, connectivity • Differentiating features: −Touch user interface −Full connectivity −Global standards • Product: Raychem XL-Trace • Customer Need: Enhanced Fire Safety • Differentiating features: −Low smoke, zero halogen polymers −50% less smoke over standard cables 02:05 02:05 Industrial Process Heat Tracing Controller Multi Application Controller February 13, 2018 nVent Investor Day 68
Slide 69 — Business Performance Improvement Through PIMS
69 Business Performance Improvement Through PIMS Significant Process Improvements Delivering Financial Results • ~800 bps improvement in Operating Margins since 2012 Lean Manufacturing Lean Engineering New Product Development Redwood City Plant: • ~50% cycle time reduction • ~25% square foot reduction • 3 shifts to 2 shifts with increased production NPD Process: • Standard work, visual management • ~10% to 20% vitality • ~25% annual increase in 5YIR incremental revenue Global Engineering Centers: • Standard work and visual mgmt. • Work share across 8 offices • ~80% lead time reduction • ~100% improvement in production output February 13, 2018 nVent Investor Day
Slide 70 — Thermal Financial Overview
70 Thermal Financial Overview Thermal Sales Declined With Non-Recurring Projects, Profit Grew Solidly Revenue ($M) ROS $703 $692 $622 2015 2016 2017 2018 Outlook 22% 18% 24% 2015 2016 2017 2018 Outlook • Deliver new products & software • Grow in focused verticals • Regional expansion, China • Drive productivity and lean • Remove complexity • Leverage digital • Deliver pricing and velocity +1-3% 50-70 bps February 13, 2018 nVent Investor Day
Slide 71 — Key Takeaways
71 Key Takeaways Differentiated Solutions Positioned for Growth • Our Thermal Management segment has improved profitability and we believe is positioned for sustained growth − Highly differentiated products and solutions − Diversified to capitalize on key global trends • We expect to grow by: − Launch of new products & software − Delivering Vertical growth in Industrial, Commercial and Infrastructure − Expanding regional presence through localization • We plan to expand margins by: − Driving productivity, pricing and velocity February 13, 2018 nVent Investor Day
Slide 72 — Electrical & Fastening Solutions (EFS)
Electrical & Fastening Solutions (EFS) Robert van der Kolk President, EFS
Slide 73 — What You Will Hear Today
73 What You Will Hear Today Sustained Profitable Growth • Our Electrical & Fastening Solutions (EFS) segment is well positioned for sustained growth with • Innovative solutions • End-user focused applications • Strong brands with well-defined value propositions • We expect to grow by: • Innovative new products and solutions • Targeted vertical and regional focus • Further enhanced customer experience • We plan to expand margins by: • Price/Cost, productivity, lean enterprise and simplicity February 13, 2018 nVent Investor Day
Slide 74 — $541M
Other Developed 10% We provide electrical and fastening solutions that connect and protect electrical and mechanical systems and civil structures. Who We Are: Electrical & Fastening Solutions Description 2017 Financials Verticals Geographies US & Canada 70% Western Europe 18% Developing 2% Industrial 19% Energy 10% Infrastructure 14% Commercial 57% $541M Revenue ~26% ROS 74 February 13, 2018 nVent Investor Day
Slide 75 — A Global Leader in Electrical & Fastening Solutions
A Global Leader in Electrical & Fastening Solutions 75 Fastening Solutions Electrical Installation & Protection Rail & Transit Telecom Utility & Industrial Facilities Electrical Solutions Electrical Installation Seismic & Fire Protection Data Communications HVAC • .77 February 13, 2018 nVent Investor Day Data Communications Electrical Installation Electrical Protection Rail & Transit
Slide 76 — Did you know?
76 Did you know? Electrical & Fastening Solutions Connects and Protects Around the World nVent sells ERICO products to all major North American and most major international rail companies With over 100,000,000 connections installed globally, ERICO CADWELD sets the standard in the exothermic welding method in the industry since 1939 nVent manufactures and sells over 5,000 miles of CADDY Telescoping Screw Gun Brackets annually February 13, 2018 nVent Investor Day
Slide 77 — Key 2018+ Priorities to Support nVent Strategy
• Strategic channel partnerships • Digitize customer experience Key 2018+ Priorities to Support nVent Strategy 77 One nVent Focus on Attractive Verticals Innovative New Products & Solutions Targeted Geographic Expansion 1 3 4 2 • Solution selling across nVent portfolio • Aligned approach to focused verticals • Innovation with strong value propositions • Supported by macro trends • Right product, right place, right time • Efficient local teams February 13, 2018 nVent Investor Day
Slide 78 — Well Positioned to Continue Capturing Macro Trends
Well Positioned to Continue Capturing Macro Trends Macro-Trends Implications Differentiated Solutions CADDY Prefab Solutions CADDY Seismic ERIFLEX FLEXIBAR ERICO Rail Seismic Calculator Prefab Configurator • Reliable Products • Code Compliant Solutions • Ease of Use • Interactive Solutions • Modular Products • Ease of Installation February 13, 2018 nVent Investor Day 78 Electrification & Urbanization Technology & Connectivity Safety & Security
Slide 79 — 115
EFS Has Strong Competitive Advantages to Leverage 79 Brand Recognition Well-defined Value Propositions Diversification Innovation Total Cost of Ownership Design Flexibilit y 115 YEARS 53% | 83% 29% | 81% Regions Verticals & February 13, 2018 nVent Investor Day WITHOUT AID WITH AID
Slide 80 — Differentiated Solutions Drive Customer Value
Differentiated Solutions Drive Customer Value 80 Panel Manufacturer Need: Save time Save space Differentiations: Flexible Customizable solution Reduce total installed cost Safety & Reliability Customer Results: Reduced installation time Less congestion in panel Improved panel performance Before After February 13, 2018 nVent Investor Day
Slide 81 — Driving Growth With New Products
Driving Growth With New Products Strong Pipeline, Well Positioned for Growth Rail Switch Heating Systems Stamped Bracing Systems • Differentiating features: −Safety & Reliability −Energy efficient −Customized solutions • Differentiating features: −Reduce total installed cost −Ease of installation CADDY Stamped Seismic Bracing ERICO Rail Switch Heating System Differentiated Conductors • Differentiating features: −Unique −Safer −Flexible ERIFLEX FLEXIBAR ADVANCED 81 February 13, 2018 nVent Investor Day
Slide 82 — EFS Financial Overview
82 EFS Financial Overview Profitable Growth with More Opportunity Ahead Revenue ($M) ROS $147 $513 $541 2015 2016 2017 2018 Outlook 26% 28% 26% 2015 2016 2017 2018 Outlook • Innovative new products & solutions • Targeted vertical & regional focus • Strong brands with well defined value proposition • Price / Cost • Productivity and lean enterprise • Simplicity +3-5% 30-50 bps February 13, 2018 nVent Investor Day
Slide 83 — Key Takeaways
83 Key Takeaways Sustained Profitable Growth Our EFS segment is well positioned for sustained growth with Innovative solutions End-user focused applications Strong brands with well-defined value propositions We expect to grow by: Innovative new products and solutions Targeted vertical and regional focus Further enhanced customer experience We plan to expand margins by: Price/Cost, productivity, lean enterprise and simplicity February 13, 2018 nVent Investor Day
Slide 84 — Investment Thesis & Financial Outlook
Investment Thesis & Financial Outlook Stacy McMahan Chief Financial Officer
Slide 85 — What You Will Hear Today
85 What You Will Hear Today An Attractive Long-Term Investment February 13, 2018 nVent Investor Day • Expect Industry Growth • Positive Macro Environment • Highly Profitable Business with Sustained Margin Performance • Consistent, Strong Cash Flow • Disciplined Capital Allocation
Slide 86 — Organic:
86 Differentiated Growth Focus on Establishing Reliable Growth Profile Organic: • Favorable macro trends • Differentiated opportunities in verticals • New products and connected solutions • Underpenetrated in certain global verticals Inorganic: • Attractive bolt-on targets in highly fragmented markets February 13, 2018 nVent Investor Day
Slide 87 — Favorable Margin Profile
Favorable Margin Profile $1,809 $2,116 $2,098 20% 21% 21% 2015 2016 2017 Sales Adj. EBITDA Margin …with established margin performance via: • Diversification • Growth in new regions and new products • MRO business mix • Lean enterprise Starting from a position of competitive margin… Sales & Adjusted EBITDA Margin1 2017 Adj. EBITDA Margin1 of Select Electrical Peers Note: Adjusted EBITDA Margin excludes the impact of non-cash amortization, certain acquisition related expenses, costs of restructuring activities, “mark-to-market” gain (loss) for pension and other post-retirement plans, impairments, and other unusual non-operating items. ¹ 2017A adj. EBITDA margins for Littelfuse, nVent, and Hubbell, 2017E adj. EBITDA margins for Amphenol, Legrand, Thermon, Eaton, and Schneider Electric based on IBES estimates. Hubbell not pro forma for the acquisition of Aclara. February 13, 2018 nVent Investor Day 23.9% 23.7% 22.5% 21.0% 18.2% 17.3% 17.3% 16.5%
Slide 88 — A Clear Opportunity to Drive Margin Expansion
88 A Clear Opportunity to Drive Margin Expansion Runway for Sustained Profitability Improvement • Drive profitable growth ‒ Commercial excellence ‒ Pricing optimization ‒ Product vitality acceleration • Expand lean enterprise ‒ Lean information flow ‒ Integrated supply chain • Driving common processes and systems February 13, 2018 nVent Investor Day
Slide 89 — Strong Cash Flow Generation
Strong Cash Flow Generation Consistent and Strong Free Cash Flow Generation • Target free cash flow at 100% of adjusted net income • Drive working capital velocity Free Cash Flow1 Capital Expenditures $47 $75 $32 2.6% 3.5% 1.5% 2015 2016 2017 Capex % of Sales (%) $251 $232 $334 109% 86% 115% 2015 2016 2017 Free Cash Flow % Adj. Net Income 1.Free cash flow represents net cash provided by operating activities, less capital expenditures, plus proceeds from sale of property and equipment. February 13, 2018 nVent Investor Day • Low capital intensity • Expect capital expenditures to equal depreciation
Slide 90 — Conservative Capital Structure and Allocation Philosophy
90 Conservative Capital Structure and Allocation Philosophy Committed and Disciplined • Target investment grade metrics • Balanced capital deployment strategy • Competitive dividend policy • Share repurchases to offset dilution at a minimum • Bolt-on acquisitions targeting focused growth areas February 13, 2018 nVent Investor Day
Slide 91 — M&A Strategy
91 M&A Strategy Well Prepared to Execute Key Considerations: • How does the target fit nVent’s strategy? • How compelling are the financials of the deal? • Why are we the right buyer? • What’s our integration plan? • Who’s the integration team? Example of Financial Targets: • ROIC crosses cost of capital at 24 months • Accretive at 12 months February 13, 2018 nVent Investor Day
Slide 92 — nVent Financial Overview
92 nVent Financial Overview Expecting Solid Top Line and Adjusted EPS Growth February 13, 2018 nVent Investor Day *Includes 3 months from ERICO acquisition Revenue ($B) Segment Income ($M) Pro Forma Adjusted EPS $1.81* $2.12 $2.10 2015 2016 2017 2018 Outlook $1.58 2017 2018 Outlook $1.70-$1.80 • Interest: $40M in 2017, ~30M in 2018 • Tax rate: 20% in 2017, ~18% in 2018 • Share count: 184M in 2017, ~183M in 2018 Summary • Sales expected to be up 3-5% on 2-4% core sales growth • Segment Income growth, inclusive of incremental growth investment • Target free cash flow = Adj. Net Income • Tax rate tailwind in 2018 +~10% +3-5% ~$420 $339* $401 $404 2015 2016 2017 2018 Outlook
Slide 93 — 2017 and 2018 Revenue Performance
93 2017 and 2018 Revenue Performance Focused Initiatives Drive Growth in 2018 2017 2018E (1 pt) 2016 FX 2017 Price Volume Acq./ Large Jobs 3 pts 0 pts (4 pts) 1 pts -0.9% YoY ($89M) $2.1B $12M $58M $1M $2.1B (1 pt) 2017 FX 2018E Price Volume ~2 pts ~1 pts ~1 pts +3-5% YoY $2.1B ~$25M ~$40M ~$15M ~$2.2B Summary Summary Adjusted Core Sales Up ~3% • Enclosures Up 2% • Thermal Management Up 4% • EFS Up 2% February 13, 2018 nVent Investor Day Core Sales Up 2-4% • Enclosures Up 3-5% • Thermal Management Up 0-2% • EFS Up 2-4%
Slide 94 — 2017 and 2018 Segment Income Performance
94 2017 and 2018 Segment Income Performance Investing in Growth and Accelerating Productivity 2017 2018E (1 pt) 2016 Prod. 2017 FX Growth/ Price/Acq. Inflation 1% YoY ($42M) $401M $28M $15M $2M $404M Summary Summary ROS 19% ROS 19% (1 pt) 2017 Prod. 2018E FX Growth/ Price Inflation ~4% YoY ($55M) $404M $50M ~$15M ~$5M ~$420M ROS 19% ROS ~19% Net of Growth Investment February 13, 2018 nVent Investor Day • Income up 1%, ROS +20 bps • Price lagged inflation, positive exit rate • Stabilizing productivity headwinds in Enclosures • Income up ~4% • Flat ROS inclusive of growth investments • Expect Enclosures margin improvement in 2H 2018
Slide 95 — 2017 and 2018 Adjusted EPS and Free Cash Flow
95 2017 and 2018 Adjusted EPS and Free Cash Flow Expecting to Deliver Double Digit Adjusted EPS Growth Adjusted EPS Free Cash Flow (1 pt) 2018E Capex Depreciation ~$320M ~$0M ~$35M (~$35M) ~$320M Summary Summary (1 pt) 2017 Pro Forma EPS Tax Rate 2018 Adj. EPS Outlook Interest Segment Income ~5% ~2% ~3% $1.58 ~$.03 ~$.08 ~$.04 $1.70-$1.80 +~10% YoY • Interest expense dependent on final capital structure • Effective tax rate improves to ~18%, down 2 points from 2017 rate • Shares of ~183M • Business is not capital intensive • Capex is ~2% of estimated 2018 sales • Target free cash flow to equal adjusted net income 2018 Adj. Net Inc. Outlook Work Cap/ Other February 13, 2018 nVent Investor Day - Restructuring - Taxes + Working __Capital
Slide 96 — Full Year 2018 nVent Outlook
96 Full Year 2018 nVent Outlook Stand Up nVent While Growing the Top Line and Investing in Growth Enclosures Thermal EFS Total Core Sales Up 3-5% Up 0-2% Up 2-4% Up 2-4% ROS ~Flat +50-70bps +30-50bps ~Flat Corporate Expenses ~$45M Interest Expense ~$30M Tax Rate ~18% Adjusted EPS $1.70 - $1.80 Shares ~183M February 13, 2018 nVent Investor Day Key Considerations • FX sales benefit of ~1% • ROS inclusive of growth investments • Tax rate benefit of ~2% from tax reform • Capital expenditures ~2% of sales • Total D&A of ~$100M + ~$13M of non- cash stock compensation
Slide 97 — Long-Term Financial Outlook
Strong Growth - GDP growth plus one or two points - EPS grows multiple points faster than sales Disciplined Capital Allocation - Competitive dividend policy - Repurchase shares to offset dilution - Active and disciplined M&A program Robust Cash Generation - Free Cash Flow conversion at 100% of Adjusted Net Income - Best in class Working Capital management Strong Balance Sheet -Target Investment grade metrics - Sustain prudent liquidity levels 97 Long-Term Financial Outlook February 13, 2018 nVent Investor Day
Slide 98 — Investment Thesis
98 February 13, 2018 nVent Investor Day Investment Thesis Generate Shareholder Value with Leading Brands and a Competitive Playbook Mission-Critical Solutions Maximize Customer Efficiency Leading Industry Positions, Brands and Footprint Diversified Across Products, Verticals and Customers Strong Financial Profile and Operational Focus Strong Cash Flow Generation Conservative Capital Structure & Capital Allocation Philosophy Value Creation
Slide 99 — 10 Minute Break
10 Minute Break
Slide 100 — Question & Answer Session
Question & Answer Session
Slide 101 — Thank You
Thank You
Slide 102 — nVent Leadership Bio’s
nVent Leadership Bio’s
Slide 103 — nVent Leadership Bio’s
103 nVent Leadership Bio’s RANDALL J. HOGAN CHAIRMAN | NVENT Randall J. Hogan currently serves as Pentair’s Chairman and Chief Executive Officer and upon the separation, he will serve as Chairman of nVent. Hogan was named Pentair’s Chief Executive Officer in 2001 and was appointed Chairman in 2002. He first joined Pentair in 1998 as Executive Vice President of the Enclosures Group. Prior to Pentair, Hogan was President of United Technologies’ Carrier Transicold Division. He also held leadership roles at the Pratt & Whitney division of United Technologies, General Electric, and McKinsey & Company. Hogan serves as a Director of Medtronic plc where he is also a member of the Audit and Finance Committees. Hogan holds an MBA from the University of Texas at Austin and a Bachelor of Science degree in Civil Engineering from the Massachusetts Institute of Technology. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 104 — nVent Leadership Bio’s
104 nVent Leadership Bio’s BETH A. WOZNIAK CHIEF EXECUTIVE OFFICER | NVENT Ms. Wozniak will be the Chief Executive Officer of nVent. She was named Pentair's Senior Vice President and President of its Electrical segment in 2017. She previously served as President of Pentair's Flow & Filtration Solutions global business unit, now a part of the Water segment. Prior to joining Pentair in 2015, Ms. Wozniak held several leadership positions at Honeywell and its predecessor AlliedSignal. She was most recently President of Honeywell’s Environmental and Combustion Controls business. Previously, she held several executive positions at Honeywell including President of its Sensing and Control business; Vice President of Business Integration; Vice President of Six Sigma; and Vice President of Engineering and Program Management. Ms. Wozniak holds a Bachelor of Engineering degree from McMaster University in Hamilton, Ontario, Canada and an MBA from York University in Toronto. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 105 — nVent Leadership Bio’s
105 nVent Leadership Bio’s STACY P. MCMAHAN EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER | NVENT Ms. McMahan will be the Executive Vice President and Chief Financial Officer of nVent. Previously, Ms. McMahan was the Chief Financial Officer of The Spectranetics Corporation (a developer and manufacturer of single-use medical devices) beginning in September 2015. Ms. McMahan was the Senior Vice President, Chief Financial Officer and Treasurer of MSA Safety, Inc. (a global industrial company protecting the health and safety of industrial workers) from 2013 – 2015 and the Senior Vice President, Finance of MSA Safety, Inc. from 2012 – 2013. Previously, she served over 20 years in the life science industry, most recently as Vice President, Finance for the Customer Channels Group of Thermo Fisher Scientific from 2011 to 2012 where she directed the channel finance function supporting research, safety and healthcare customers and suppliers. Ms. McMahan served over six years with the Johnson & Johnson family of companies as the Vice President of Finance and Chief Financial Officer for Johnson & Johnson Customer & Logistics Services and Johnson & Johnson Health Care Systems; the World Wide Vice President of Finance and Chief Financial Officer for DePuy Orthopaedics; and Executive Director of Finance for Ethicon Endo-Surgery. Ms. McMahan received a Bachelor of Science in Finance from Oklahoma State University and an MBA from the Harvard Business School. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 106 — nVent Leadership Bio’s
106 nVent Leadership Bio’s LYNNETTE R. HEATH EXECUTIVE VICE PRESIDENT, CHIEF HUMAN RESOURCES OFFICER | NVENT Ms. Heath will be the Executive Vice President and Chief Human Resource Officer of nVent. She joined from Twin Cities based Entrust Datacard, where she served as Senior Vice President of Global Human Resources since 2009. Previously, she served in HR roles at General Electric, McKesson Corp, and Xcel Energy. Ms. Heath has a Bachelor of Arts degree in Political Science from the University of Minnesota. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 107 — nVent Leadership Bio’s
107 nVent Leadership Bio’s JON D. LAMMERS EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY | NVENT Mr. Lammers will be the Executive Vice President, General Counsel and Secretary of nVent. He joined from Wichita based Foulston Siefkin LLP. Previously he served as Senior Vice President, General Counsel and Secretary at Spirit AeroSystems in Wichita and held various senior legal roles at Cargill in Minneapolis, Wichita and Singapore. Prior to his corporate experience, Jon practiced law at Oppenheimer, Wolff & Donnelly and Paul Hastings. Mr. Lammers received his law degree from the University of Virginia and his Bachelor of Science degree in Business Administration from the University of Southern California. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 108 — nVent Leadership Bio’s
108 nVent Leadership Bio’s BENJAMIN R. SOMMERNESS EXECUTIVE VICE PRESIDENT, CHIEF GROWTH & STRATEGY OFFICER | NVENT Mr. Sommerness will be the Executive Vice President, Chief Growth and Strategy Officer of nVent. He joined from Twin Cities-based Smiths Medical, where he served as Vice President of Global Strategy and Transformation since 2010. Previously, he served in leadership roles at the Boston Consulting Group, Talmadge Consulting and G&K Services. A former Captain in the U.S. Army, Sommerness earned an MBA in Finance at the Wharton School at the University of Pennsylvania and a Bachelor of Science degree in Civil Engineering at the United States Military Academy at West Point. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 109 — nVent Leadership Bio’s
109 nVent Leadership Bio’s TOM F. PETTIT EXECUTIVE VICE PRESIDENT, CHIEF INTEGRATED SUPPLY CHAIN OFFICER | NVENT Mr. Pettit will be the Executive Vice President and Chief Integrated Supply Chain Officer of nVent. He is currently the Operations and Supply Chain Vice President of Pentair and has served in that role since 2015, and previously from 2008-2013. Earlier, Mr. Pettit previously served as the Chief Operating Officer for BioScrip, Inc. (a provider of infusion and home care management solutions) from 2014 – 2015, as the Senior Vice President and General Manager for Ryder Supply Chain Solutions from 2013 – 2014 (a logistics company), and as the Vice President, Finance and Global Supply Chain for ADC Telecommunications, Inc. from 2005 – 2008. He worked for General Electric Company as a Sourcing Leader from 2002 – 2003 and then as a Product General Manager from 2003 – 2005. Mr. Pettit held various consulting positions with Towers Perrin General Management Services and McKinsey & Company, Inc. from 1995 – 2002. He began his career serving in the US Army as an officer in the Corps of Engineers. Mr. Pettit has a BS from the United States Military Academy at West Point, and an MBA from the University of Hawaii. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 110 — nVent Leadership Bio’s
110 nVent Leadership Bio’s JOSEPH A. RUZYNSKI PRESIDENT, ENCLOSURES | NVENT Mr. Ruzynski will be the President of Enclosures at nVent. Mr. Ruzynski is currently the Vice President of Pentair’s Enclosures Strategic Business Unit and has served in that role since January 2017. Mr. Ruzynski previously served as Vice President of Pentair’s Engineered Projects Strategic Business Group in its Valves & Controls Global Business Unit from 2016 – 2017 and Vice President of Pentair’s Fluid Motion Business Group from 2015 – 2016. He was the Vice President, Operations of Pentair’s Equipment Protection and Technical Solutions Global Business Units from 2012 – 2014, and held various supply leadership positions with Pentair from 2003 – 2012. Mr. Ruzynski was a Manager with Ernst & Young from 1997 – 2003. Mr. Ruzynski holds a BA in Mathematics and Computer Science from St. John’s University and an MBA from the Carlson School, University of Minnesota. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 111 — nVent Leadership Bio’s
111 nVent Leadership Bio’s M. BRADLEY FAULCONER PRESIDENT, THERMAL MANAGEMENT| NVENT Mr. Faulconer will be the President of Thermal Management at nVent. Mr. Faulconer is currently the Vice President of Pentair’s Thermal Management Strategic Business Unit of the Electrical segment and has served in that role since January 2017. Mr. Faulconer previously served as the Vice President of Pentair’s Thermal Building Solutions Unit from 2014 – 2016. He was the Vice President, Marketing of Pentair’s Thermal Management Unit from 2010 – 2013. Mr. Faulconer held various general management and marketing leadership roles with Tyco Thermal Controls in the U.S. and Asia from 2001 – 2010. From 1991 – 2000, Mr. Faulconer held various sales roles with Valquip Corporation. Mr. Faulconer holds a Bachelor of Science degree in Civil Engineering from Villanova University. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 112 — nVent Leadership Bio’s
112 nVent Leadership Bio’s ROBERT J. VAN DER KOLK PRESIDENT, EFS | NVENT Mr. van der Kolk will be President, EFS at nVent. He currently serves as Vice President / General Manager of the Electrical Fastening Solutions Business (EFS), of Pentair, since September 2015. Between September 2015 and May 2016 Robert was member of the team that oversaw the integration of ERICO International Corporation into Pentair. From January 1, 2012 to September 2015 Robert served as Executive Vice President, ERICO Sales and member of the Executive Management Team of ERICO International Corporation. From Jan 1, 2011 Robert served as Vice President LENTON Sales and member of the Executive Management Team, prior to which Robert served as Vice President LENTON from 2008 to 2010. From 2004 to 2008 Robert served as Director Development, from 2002 to 2004 as Director Manufacturing Fixing and Fastening Business and in 2001 as Worldwide Manufacturing Manager CRP & Electrical Business. Prior to joining ERICO, Robert was with Cargill as Plant Superintendent in Mainz Germany from 2000 to 2001, Assistant Plant Superintendent in Riesa Germany from 1998 to 2000 and Production Supervisor in Amsterdam, The Netherlands from 1993 to 1998. Mr. van der Kolk earned a B.S and M.S. in Mechanical Engineering from the Technical University in Delft, Netherlands. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 113 — nVent Leadership Bio’s
113 nVent Leadership Bio’s RANDOLPH A. WACKER SENIOR VICE PRESIDENT & CHIEF ACCOUNTING OFFICER| NVENT Mr. Wacker will be the Senior Vice President and Chief Accounting Officer of nVent. Currently, Mr. Wacker is the Assistant Corporate Controller of Pentair plc beginning in October 2005. Previously, Mr. Wacker was the U.S. Controller of Computer Network Technologies (a specialized IT networking company) from 2004 – 2005. Previously, he served over 10 years in corporate controlling and external reporting roles in various public companies. Mr. Wacker also served over five years with the public accounting firm CliftonLarsonAllen (fka Larson Allen & Weishair). Mr. Wacker holds a Bachelor of Science degree in Accounting from St. Cloud State University. February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair
Slide 114 — nVent Leadership Bio’s
114 nVent Leadership Bio’s February 13, 2018 nVent Investor Day Future nVent Leadership Team Following Separation of the Electrical Business from Pentair J.C. WEIGELT VICE PRESIDENT, INVESTOR RELATIONS | NVENT J.C. Weigelt currently serves as Vice President, Investor Relations of Electrical and upon the separation, he will serve as Vice President, Investor Relations for nVent. Mr. Weigelt joined Pentair in 2017. Prior to Pentair, Mr. Weigelt served as Senior Director, Investor Relations and Market Intelligence at St. Jude Medical. Mr. Weigelt holds a Master of Business Administration degree in Finance from the University of St. Thomas and a Bachelor of Arts degree in Marketing from Michigan State University.
Slide 115 — Appendix
Appendix GAAP to Non-GAAP Measurements & Reconciliations
Slide 116 — Reported to Adjusted 2015-2018 Reconciliation
116 February 13, 2018 nVent Investor Day Reported to Adjusted 2015-2018 Reconciliation 2015 2016 2017 Total nVent Net sales 1,809 $ 2,116 $ 2,098 $ approx 2,170 $ Net income 210 259 354 approx 270 Provision (benefit) for income taxes 56 56 (41) approx 59 Income before income taxes 266 315 313 approx 329 Interest expense 1 1 1 approx 30 Operating income 267 316 314 approx 359 % of net sales 15% 15% 15% approx 17% Adjustments: Restructuring and other 16 12 13 approx - Pension and other post-retirement mark-to-market (gain) loss (13) 11 (3) approx - Intangible amortization 32 61 61 approx 61 Trade name impairment - 13 16 approx - Deal related costs and expenses 14 - - approx - Inventory step-up 36 - - approx - Separation costs - - 16 approx - Corporate allocations (13) (12) (14) approx - Segment income 339 401 404 approx 420 Return on sales 19% 19% 19% approx 19% Depreciation 31 34 37 approx 36 EBITDA—as adjusted 370 $ 436 $ 440 $ approx 456 $ Adjusted EBITDA margin 20% 21% 21% approx 21% Net income - pro forma adjusted Segment income 339 401 404 approx 420 Interest expense - pro forma 46 63 40 approx 30 Income before income taxes - pro forma adjusted 293 338 364 approx 390 Adjusted effective tax rate 21% 20% 20% approx 18% Provision for income taxes - pro forma adjusted 62 68 73 approx 70 Net income - pro forma adjusted 231 $ 270 $ 291 $ approx 320 $ Diluted earnings per ordinary share - pro forma adjusted Diluted weighted average ordinary shares outstanding - pro forma 183 183 184 approx 183 Diluted earnings per ordinary share - pro forma 1.15 $ 1.42 $ 1.92 $ approx $1.43-$1.53 Adjustments: Adjustments to operating income 72 85 90 approx 61 Adjustments to interest expense (45) (62) (39) approx - Income tax adjustments (6) (12) (113) approx (11) Diluted earnings per ordinary share - adjustments 0.11 0.06 (0.34) approx 0.27 Diluted earnings per ordinary share - pro forma adjusted 1.26 $ 1.48 $ 1.58 $ approx $1.70-$1.80 nVent Electric plc Reconciliation of the GAAP year ended December 31, 2018, 2017, 2016 and 2015 to the non-GAAP excluding the effect of 2018, 2017, 2016 and 2015 adjustments (Unaudited) In millions Actual Forecast 2018
Slide 117 — Reported to Adjusted 2015-2018 Reconciliation
117 Reported to Adjusted 2015-2018 Reconciliation 2015 2016 2017 Free Cash Flow Net cash provided by (used for) operating activities - as reported 344 $ 364 $ 402 $ approx 385 $ Interest expense - pro forma 46 63 40 approx 30 Net cash provided by (used for) operating activities - pro forma adjusted 298 301 362 approx 355 Capital expenditures (47) (75) (32) approx (35) Proceeds from sale of property and equipment 1 6 4 approx - Free cash flow - pro forma adjusted 251 $ 232 $ 334 $ approx 320 $ nVent Electric plc Reconciliation of the GAAP year ended December 31, 2018, 2017, 2016 and 2015 to the non-GAAP excluding the effect of 2018, 2017, 2016 and 2015 adjustments (Unaudited) In millions Actual Forecast 2018 February 13, 2018 nVent Investor Day
Slide 118 — Full Year 2017 and 2018 Core Sales Growth Reconciliation
February 13, 2018 nVent Investor Day 118 Full Year 2017 and 2018 Core Sales Growth Reconciliation February 13, 2018 nVent Investor Day Adjusted Core Large Jobs Core Currency Acq./Div. Total nVent 2.8% (4.9%) (2.1%) 0.5% 0.7% (0.9%) Enclosures 2.4% 0.2% —% 2.6% Thermal Management 3.5% (14.8%) (11.3%) 1.2% —% (10.1%) Electrical & Fastening Solutions 2.2% 0.5% 2.8% 5.5% Core Currency Acq./Div. Total nVent approx 2-4% 1% 0% 3-5% Enclosures approx 3-5% 1% 0% 4-6% Thermal Management approx 0-2% 1% 0% 1-3% Electrical & Fastening Solutions approx 2-4% 1% 0% 3-5% 2017 Net Sales Growth 2018 Forecast Net Sales Growth nVent Electric plc Reconciliation of Net Sales Growth to Core Net Sales Growth by Segment for the years ended December 31, 2018 and 2017 (Unaudited)