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8-K - 8-K - TIMKEN CO | d38485d8k.htm |
EX-99.1 - EX-99.1 - TIMKEN CO | d38485dex991.htm |
Expanding the Timken Power Transmission Portfolio:
Carlstar Belts August 3, 2015 Exhibit 99.2 |
2 Forward-Looking Statements Safe Harbor Certain statements in this presentation (including statements regarding the company's forecasts, beliefs,
estimates and expectations) that are not historical in nature are
"forward-looking" statements within the meaning of
the Private Securities Litigation Reform Act of 1995. In particular, the statements related to Timkens plans, outlook, future financial performance, targets, projected sales, cash flows, liquidity and expectations
regarding the future financial performance of the company, including the
information under the headings, Strategic Rationale
and Financial Summary are forward-looking. The company cautions that actual results may differ materially from those projected or implied in forward-looking statements due to a variety of important
factors, including: the inability to complete the acquisition due to either the
failure to satisfy any condition to the closing of the
transaction, including receipt of regulatory approval, or the occurrence of any event, change or other circumstance that could give rise to the termination of the purchase agreement; the inability to
successfully integrate the newly acquired business into the companys
operations or achieve the expected synergies associated with the
acquisition; and adverse changes in the markets served by the newly acquired business. Additional factors are discussed in the company's filings with the Securities and Exchange
Commission, including the company's Annual Report on Form 10-K for the year
ended Dec. 31, 2014, quarterly reports on Form 10-Q and
current reports on Form 8-K. Except as required by the federal securities laws, the company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a
result of new information, future events or otherwise.
2 |
3 A leading North American supplier, offering power transmission belts for industrial, commercial and consumer applications Portfolio features more than 20,000 parts engineered for demanding applications Products include wrap molded, raw edge, v-ribbed, synchronous belts Serves diverse industries Business founded over 100 years ago; headquartered in Springfield, MO Carlstar Belts Business* Key Metrics* ($M) Revenue $140 Adj. EBITDA $22 % Margin 16% # of Employees ~750 *Trailing 12-months as of
June 30, 2015 Key Market Sectors
Agriculture Outdoor Power Consumer Outdoor Power Commercial Power Sports Industrial Distribution 3 The transaction, expected to close in the third quarter of 2015, is subject to customary government and regulatory
approvals as well as other customary closing conditions and will be funded with
a combination of cash and debt. |
Aligns well with Timken strategy and business model Broadens Timken power transmission products offering Leverages Timken channel strength and customer access Creates significant synergy opportunities Expected to be accretive in year one Strategic Rationale 4 |
5 Housed Units Chain & Augers Belts Gears & Services Lubrication Systems Building Out Our Power Transmission Offering Timken Power Transmission Portfolio 5 |
Leverage Timken and Carlstar customer relationships and distribution channels to drive revenue growth Expand geographically Cost synergies EPS accretive* Marginally over balance of 2015 2016 accretion of $0.08-$0.10 per share expected Expected to earn cost of capital by year 3 Financial Summary Purchase price of $220M Funded with cash and debt Transaction structure results in $23M NPV tax benefit (tax- deductible goodwill) Purchase multiple of ~9x TTM EBITDA including tax benefit Meets Financial Criteria Transaction Highlights Synergy Drivers Pro Forma (TTM) * Excluding one-time transaction costs and inventory step-up impact
6 Timken Carlstar Belts Pro forma Sales 3,001 140 3,141 Adj. EBITDA 491 22 513 % Margin 16% 16% 16% |
Dec 2012 Oct 2011 March 2013 July 2011 April 2013 May 2013 Electric motor repair and services Electric motor repair, related services, up-tower wind maintenance and repair Lubrication delivery systems Chains, augers Industrial gear drive and repair services Industrial gear drive and repair services Split roller housed units Electric motor repair and services April 2014 Nov 2014 July 2010 Spherical roller bearing steel housed unit and couplings Portfolio Transformation Building for Growth Aug 2015 Industrial and commercial belts Carlstar Belts 7 |