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INVESTOR PRESENTATION
FEBRUARY 2020
Altra Industrial Motion Corp.
Safe Harbor Statement
2
Forward-Looking Statements
All statements, other than statements of historical fact included in this presentation are forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995.
These statements include, but are not limited to, any statement that may predict, forecast, indicate or imply future results, performance, achievements or events. Forward-looking statements can
generally be identified by phrases such as “believes,” “expects,” “potential,” “continues,” “may,” “should,” “seeks,” “predicts,” “anticipates,” “intends,” “projects,” “estimates,” “plans,” “could,”
“designed”, “should be,” and other similar expressions that denote expectations of future or conditional events rather than statements of fact. Forward-looking statements also may relate to
strategies, plans and objectives for, and potential results of, future operations, financial results, financial condition, business prospects, growth strategy and liquidity, and are based upon financial
data, market assumptions and management's current business plans and beliefs or current estimates of future results or trends available only as of the time the statements are made, which may
become out of date or incomplete. Forward looking statements are inherently uncertain, and investors must recognize that events could differ significantly from our expectations. These
statements include, but may not be limited to, the statements related to our Business Outlook, our expectations regarding our tax rate, our expectations regarding the integration of the A&S
businesses and the impact of such acquisition on our business, including our expectations regarding achieving anticipated synergies and other cost improvements, our expectations regarding
delevering our business and our ability to delever our business, our expectations regarding growth opportunities and our ability to drive growth, changes in how we calculate certain non-GAAP
measures, expectations regarding improvements in the macro economic environment and outlooks in China and Germany, our expectations regarding our ability to serve our customers and
deliver value for our shareholders, our expectations regarding continued sales, earnings and free cash flow growth in 2020 and the Company’s guidance for full year 2020.
In addition to the risks and uncertainties noted in this presentation, there are certain factors that could cause actual results to differ materially from those anticipated by some of the statements
made. These include: (1) competitive pressures, (2) changes in political and economic conditions in the United States and abroad and the cyclical nature of our markets, (3) loss of distributors,
(4) the ability to develop new products and respond to customer needs, (5) risks associated with international operations, including currency risks, and the effects of tariffs and other trade actions
taken by the United States and other countries (6) accuracy of estimated forecasts of OEM customers and the impact of the current global economic environment on our customers, (7) risks
associated with a disruption to our supply chain, (8) fluctuations in the costs of raw materials used in our products, (9) product liability claims, (10) work stoppages and other labor issues, (11)
changes in employment, environmental, tax and other laws and changes in the enforcement of laws, (12) loss of key management and other personnel, (13) risks associated with compliance with
environmental laws, (14) the ability to successfully execute, manage and integrate key acquisitions and mergers, (15) failure to obtain or protect intellectual property rights, (16) risks associated
with impairment of goodwill or intangibles assets, (17) failure of operating equipment or information technology infrastructure, including cyber-attacks or other security breaches, and failure to
comply with data privacy laws or regulations, (18) risks associated with our debt leverage, (19) risks associated with restrictions contained in the agreements governing the Notes and the Altra
Credit Facilities, (20) risks associated with compliance with tax laws, (21) risks associated with the global recession and volatility and disruption in the global financial markets, (22) risks
associated with implementation of our ERP system, (23) risks associated with the Svendborg, Stromag, and A&S acquisitions and integration and other acquisitions, (24) risks associated with
certain minimum purchase agreements we have with suppliers, (25) risks related to our relationships with strategic partners, (26) our ability to offset increased commodity and labor costs with
increased prices, (27) risks associated with our exposure to variable interest rates and foreign currency exchange rates, (28) risks associated with interest rate swap contracts, (29) risks
associated with our exposure to renewable energy markets, (30) risks related to regulations regarding conflict minerals, (31) risks related to restructuring and plant consolidations, (32) risks
related to our acquisition of A&S, including (a) the possibility that we may be unable to achieve expected synergies and operating efficiencies in connection with the transaction within the
expected time-frames or at all and to successfully integrate A&S, (b) expected or targeted future financial and operating performance and results, (c) operating costs, customer loss and business
disruption (including, without limitation, difficulties in maintain relationships with employees, customers, clients or suppliers) being greater than expected following the transaction, (d) our ability to
retain key executives and employees, (e) slowdowns or downturns in economic conditions generally and in the markets in which the A&S businesses participate specifically, (f) lower than
expected investments and capital expenditures in equipment that utilizes components produced by us or A&S, (g) lower than expected demand for our or A&S’s repair and replacement
businesses, (h) our ability to successfully integrate the merged assets and the associated technology and achieve operational efficiencies, (i) the integration of A&S being more difficult, time-
consuming or costly than expected, (j) the inability to undertake certain corporate actions that otherwise could be advantageous to comply with certain tax covenants, (k) potential unknown
liabilities and unforeseen expenses related to the acquisition and (l) the impact on our internal controls and compliance with the regulatory requirements under the Sarbanes-Oxley Act of 2002,
(33) the risk associated with the UK’s departure from the European Union, (34) Altra’s ability to achieve the efficiencies, savings and other benefits anticipated from its cost reduction, margin
improvement, restructuring, plant consolidation and other business optimization initiatives, (35) the risks associated with transitioning from LIBOR to a replacement alternative reference rate, and
(36) other risks, uncertainties and other factors described in the Company's quarterly reports on Form 10-Q and annual reports on Form 10-K and in the Company's other filings with the U.S.
Securities and Exchange Commission (SEC) or in materials incorporated therein by reference. Except as required by applicable law, Altra does not intend to, update or alter its forward-looking
statements, whether as a result of new information, future events or otherwise.
3
Altra Snapshot
Headquartered in Braintree, Massachusetts
51 global production facilities
Approximately 9,500 employees
27 industry-leading brands averaging over 85 years of market expertise
Altra Industrial Motion Corp. Equity Snapshot
Nasdaq: AIMC
Market Cap:
Diluted Shares O/S: 64.6 million
Quarterly Dividend: $0.17 (Q1)Dividend Yield: 1.8%
$2.4 billionAs of February 13, 2020
LTM Revenues: $1.83 billion
Altra is a premier manufacturer of highly engineered products, software and services,
designing innovative solutions that create, control and transmit motion and power.
4
Industry Leading Profile
1 Refer to Appendix for GAAP to non-GAAP reconciliations
36%Q4 2019 GAAP Gross
Margin
16%Q4 2019 Non-GAAP
Operating Margin1
20%Q4 2019 Non-GAAP
Adjusted EBITDA Margin1
Automation and
Specialty (A&S)
Power Transmission
Technologies (PTT)
• Advanced servo motors,
drives and controls
• Software and custom
motion systems
• Engineered linear systems
• Precision miniature motors
• Engine retarding systems
• Engineered heavy duty
clutches and brakes
• Flexible couplings
• Gear drives and gear motors
• Electric clutches and brakes
• PT components
$224 million51% of Total Q4 Sales
$219 million49% of Total Q4 Sales
Q4 Revenues
Key Brands • Jacobs Vehicle Systems
• Kollmorgen
• Portescap
• Thomson
Key Products
• Bauer Gear Motor
• Boston Gear
• Stromag
• Svendborg
• Warner Electric
Segments
$442mQ4 2019 Revenues
Industry Leading Brand Names
Highly Engineered Products
Leading Financial Profile
$45 million20.3% of Segment Sales
$29 million13.1% of Segment Sales
Q4 Non-GAAP Income
from Operations1
Well established industry-leading brands known for global technical support and product reliability
Long History as Critical Supplier to Customers with Strong Brand Names
Expanding position across technology spectrum with highly engineered products, software & service solutions
Expanding Presence Across Technology Spectrum
Track record of continuous improvement, organic growth and developing outstanding leaders
A Proven World-Class
Business System
Excellent margin profile, 5-year margin improvement drivers could yield 425 bps
Margin Expansion Potential
Expect $1B cumulative FCF in 5 years – Target leverage ratio of 2x to 3x net debt to Adjusted EBITDA1
Strong Free Cash Flow1
Supports Quick De-Levering
Serving high-growth, high-margin end markets and specialty niche industries with attractive secular trends
Strong Market Position Across Diverse Set of End Markets
5
A $1.8 Billion Premier Industrial Company
1 Free Cash Flow and Adjusted EBITDA are Non-GAAP measure. Refer to the Appendix for a reconciliation of Non-GAPP measures.
6
• Balanced markets with exposure to attractive secular trends
• Expanding exposure to high growth regions
• High degree of collaboration with engineers at OEM customers;
strong distributor partners supporting the aftermarket
• Geographic revenues based upon point of shipment.
• Management estimates.
Balanced Diverse Global Markets
Transportation16%
Factory Automation &
Spl. Mch.11%
T&G, Ag, Construction
8%
Energy8%
Metals & Mining
6%
Mat. Hand.8%
Medical7%
A&D6%
Other30%
2019 Revenues By Market
N. America52%
Europe30%
Asia Pac.16%
ROW2%
2019 Revenues By Geography
OEM Direct69%
Distribution25%
User Direct
6%
2019 Revenues By Channel
7
Growing Exposure to Markets With Attractive
Secular Trends
ROBOTICS
Advanced servo motor systems integrated into collaborative robots
ADVANCED MATERIAL HANDLING
Software and custom programming for AGVs in
logistics and manufacturing applications
AEROSPACE & DEFENSE
Custom frameless servo motors for land and aerial drones
MEDICAL
Sterilizable miniature motors for arthroscopic surgical tools
8
Long-Standing Expertise Serving Traditional Markets
RENEWABLE ENERGY
Brakes for Offshore and Onshore Wind Turbines
TURF & GARDEN
Electromagnetic Clutches & Brakes for Commercial Lawn Mowers
MINING
Clutches, Brakes and Couplings for Electric Rope Shovels
TRANSPORTATION
Compression Release Brakes For Class 8 Trucks
9
Strategic Priorities to Drive Shareholder Value
Execute on the A&S integration; deliver $52 million synergies
• Identify and leverage best practices
• Seamless transition to activities that capture value
Deliver 425 BPS margin improvement
• Continue to deploy profit improvement initiatives
• Execute on synergies
• Capitalize on improving market conditions
De-lever and strengthen the balance sheet
• Prioritize debt pay down until leverage metrics return to historical levels of
2.0-3.0x Net Debt/ Adjusted EBITDA
Accelerate topline growth
• Effectively deploy Altra Business System tools
• Capitalize on technology sharing to accelerate innovation
• Strategically infuse capital into operating companies
World-Class Business System
LEADERSHIP
GROWTH LEAN
A framework to drive sustainable competitive advantage
and ensure superior execution of strategic initiatives
• Robust set of tools and processes systematically
identifies and eliminates waste
• Provides innovative solutions to customers with the
shortest lead time, highest quality and best
possible value
— Significant engagement with customers to understand their
requirements & improvement objectives
— Engineering teams strive to solve problems and assist in
developing new products
• Nurtures continuous improvement culture
engrained across the organization
— On-time delivery, lead-time reduction and quality products
and services
• Developing people to excel, grow and drive
continuous improvement
10
✓ Drive organic growth
✓ Capture bottom line savings
✓ Develop outstanding leaders
¹ Based on continued market improvement in high profit markets.
Direct deal synergies
Drivers of Margin Improvement
Other Direct and Indirect
Facility Consolidations
Application of FBS to Altra
• Direct materials and other savings
• Manufacturing / sales and administrative
• SG&A and strategic pricing initiatives
• Distributor leverage, supplier consolidations, other
$15mm
$52mm
~$80mm
Altra cost improvement
initiatives enhanced
through Fortive A&S
combination
Expect to achieve run rate synergies in four years;
over 50% of run rate synergies to be achieved by year two
Direct Deal Synergies ~$52mm
Volume / leverage mix¹
Drives
>425bps of
margin
improvement
Revenue
• Cross selling / access to new customers
Significant Long-Term Margin Upside
11
12
Successes
• Consolidated A&S business in Brazil into Altra’s facility
in Sao Paulo
• Exited Fortive plant and moved into new manufacturing
facility in Tianjin, China (on time and on budget)
• Completed Amherst, NY consolidation relocating
production into other Altra US locations
• Closed both the A&S and PTT sales and sourcing
offices in Shanghai and merged them into a new
common location
• Combined satellite sales offices in Beijing and Seoul
• Reduced A&S corporate headcount
• Bolstered PTT sourcing group – already seeing
benefits
• Cross-selling funnel growing
Synergies On Track
Delivered Synergies of $14.5 Million in 2019, Exceeding Year-One Target by 30%
2019 2020 2021 2022
$14.5
million
$30
million
$52
million
Cumulative Synergy Targets
Original Target
$10m - $12m
Strong Free Cash Flow
Positions Altra to Quickly De-lever
Prioritize Debt Pay Down Until Leverage
Metrics Return to 2.0-3.0x Net Debt / Adjusted EBITDA1
Free cash flow generation: >$1 billion
in five years1
Non-GAAP Adj. EBITDA1 in Q4 2019
was 20.0% 2
Paid down $150 million of debt since
closing the A&S merger3
1 Non-GAAP measures. Refer to the Appendix for a reconciliation of Audited Net Income to Non-GAAP Adjusted EBITDA and Total Debt to Net Debt
2As of December 31, 2017, Altra had $276 million of indebtedness outstanding and as of December 31, 2017 on a pro forma basis after giving effect to the
Transactions, Altra would have had $1,722.4 million of indebtedness outstanding.
13
Net Debt / LTM Adj. EBITDA1
2017 ProForma
Dec 2018 Dec 2019 Dec 2020Target
Dec 2021Target
~4.6x
3.9x
3.0x
2
3.8x3.5x – 3.7x
14
Accelerate Top Line Growth
Continued Execution of Cross Selling Plan
Leverage ABS Growth Tools
Utilize Technology, Including IIoT and Industry 4.0 Expertise,
to Capture New Customers
Deploy E-Commerce Capabilities to Address
Growing Customer Need for Digital Solutions
Case Stackers• Thomson Linear Units
• Micron Gearheads• Thomson Linear Bearings & Guides
• Kollmorgen Servo & Drives
Palletizer• Bauer Inline Gearmotors
• Boston Gear Bevel Gear Drives• Thomson Linear Actuators
• Micron Gearheads
Filling & Capping• Warner Capping Clutch
• Kollmorgen Washdow n Servos & Drives
• Micron Gearheads
Case Forming• Kollmorgen Servos
• Thomson Linear Units• Micron Gearheads
• Thomson Linear Bearings & Guides
Packing(Shrink Wrap)• Bauer Gearmotors
• Kollmorgen Servos & Drives
• Micron Gearheads
• Thomson Linear Bearings & Guides
Packing(Heat Shrink Tunnel)• Bauer High Heat
Gearmotors
Inspection• Kollmorgen Servos / Drives
• Thomson Motorized Lead Screw Actuators
• Micron Gearheads
• Huco Precision Couplings
Labelling• Kollmorgen Steppers
• Micron Gearheads
Bottle Washer (Glass Bottles)• Boston Gear Stainless
Reducers• Bauer Aseptic Gearmotors
• Kollmorgen Stainless
Servos & Drives
Conveyor• Bauer Shaft Mount Gear Motors
• Boston Gear Worm Gear Drives• Warner Clutch Brakes
• Formsprag Backstops
• TB Wood’s Belted Drives and
Elastomeric Couplings
• Thomson Linear Actuators
Loading• Warner Brakes
• Thomson Linear Actuators
Representative Altra ProductsRepresentative A&S Products
Engine Braking• Jacobs Vehicle Systems
15
A Premier Industrial Company
Long Established History as Critical Supplier to Customers
Expanding Presence Across Technology Spectrum
A Proven World-Class Business System
Leading Financial Profile With Margin Expansion Potential
Strong Free Cash Flow Supports Quick De-Levering
Markets With Strong Secular Trends
Appendix
17
Discussion of Non-GAAP Measures
The non-GAAP financial measures used in this presentation are utilized by management in comparing our operating performance on a consistent basis. We believe that these
financial measures are appropriate to enhance the overall understanding of our underlying operating performance trends compared to historical and prospective periods and our
peers. We believe that these measures provide important supplemental information to management and investors regarding financial and business trends relating to the Company's
financial condition and results of operations as well as insight into the compliance with our debt covenants. Non-GAAP financial measures should not be considered in isolation
from, or as a substitute for, financial information calculated in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their
most directly comparable GAAP financial measures. A reconciliation of non-GAAP financial measures presented above to our GAAP results has been provided in the financial
tables included in this press release.
Organic Sales
Organic sales in this release excludes the impact of foreign currency translation.
Non-GAAP Net Income, Non-GAAP income from operations, Non-GAAP Diluted earnings per share, Non-GAAP operating income margin, and Non-GAAP Net Income and Non-
GAAP Diluted EPS Guidance
Non-GAAP net income, non-GAAP income from operations, non-GAAP diluted earnings per share, and non-GAAP net income and non-GAAP diluted earnings per share guidance
exclude acquisition related amortization, acquisition related costs, acquisition related stock compensation costs, restructuring and consolidation costs and other income or charges
that management does not consider to be directly related to the Company’s core operating performance. Non-GAAP diluted earnings per share is calculated by dividing non-GAAP
net income by GAAP weighted average shares outstanding (diluted). Non-GAAP operating income margin is calculated by dividing Non-GAAP income from operations by GAAP Net
Sales.
Non-GAAP gross profit
Non-GAAP gross profit excludes amortization of inventory fair value adjustment. Non-GAAP gross profit margin is calculated by dividing Non-GAAP gross profit by GAAP Net Sales.
Non-GAAP adjusted EBITDA and Non-GAAP adjusted EBITDA guidance
Adjusted EBITDA represents earnings before interest, taxes, depreciation, acquisition related amortization, acquisition related costs, restructuring costs, stock-based compensation,
asset impairment and other income or charges that management does not consider to be directly related to the Company’s core operating performance.
Non-GAAP adjusted EBITDA and Non-GAAP Adjusted EBITDA Margin
Non-GAAP adjusted EBITDA Margin is calculated by dividing Non-GAAP adjusted EBITDA by GAAP Net Sales.
Non-GAAP Free cash flow
Non-GAAP free cash flow is calculated by deducting purchases of property, plant and equipment from net cash flows from operating activities.
Non-GAAP operating working capital
Non-GAAP operating working capital is calculated by deducting accounts payable from net trade receivables plus inventories.
Net Debt
Net debt is calculated by subtracting cash from total debt.
18
Appendix
Non-GAAP Measures
Non-GAAP Net Income
(amounts in millions)
Q4 2019 Q4 2018
Net income 37.3$ (5.0)$
Restructuring costs 2.4 2.3
Loss on w rite-off of deferred f inancing costs - 1.2
Amortization of inventory fair value adjustment - 14.2
Acquisition related stock compensation expense 0.6 2.0
Acquisition related expenses - 24.3
Acquisition related amortization expense 17.5 17.9
Tax Impact of above adjustments (4.6) (14.9)
Non cash deferred tax benefit due to income tax rate
change in India (10.5) -
Non-GAAP net income * 42.7 42.0
Non-GAAP diluted earnings per share * 0.66$ (1) 0.65$ (2)
(1) tax impact is calculated by multiplying the estimated effective tax rate, 22.6% by the
(2) tax impact is calculated by multiplying the estimated effective tax rate, 24.0% by the
Non-GAAP Income from operations
(amounts in millions)
Q4 2019 Q4 2018
Income from operations 52.1$ 18.2$
Restructuring costs 2.4 2.3
Acquisition related stock compensation expense 0.6 2.0
Amortization of inventory fair value adjustment - 14.2
Acquisition related amortization expense 17.5 17.9
Acquisition related expenses - 24.3
Non-GAAP income from operations * 72.6$ 78.9$
Non-GAAP Income from operations as a
percentage of net sales 16.4% 16.8%
Free Cash Flow
(amounts in millions)
Q4 2019 Q4 2018
Operating Cash Flow $73.0 $57.3
Less Capex (14.8) (16.4)
Free Cash Flow $58.2 $40.9
Non-GAAP Operating Working Capital
(amounts in millions)
Q4 2019 Q4 2018
Accounts Receivable $243.2 $259.8
Inventories 222.5 231.2
Accounts Payable (154.7) (175.8)
Operating Working Capital $311.0 $315.2
Net Debt
(amounts in millions)
Q4 2019 Q4 2018
Total Debt $1,604.0 $1,734.0
Cash (167.3) (169.0)
Net Debt $1,436.7 $1,565.0
19
Appendix
Non-GAAP Measures
Non-GAAP Income from operations by Segment
(amounts in millions)
Pow er
Transmission
Technologies
Automation
and
Specialty Corporate Total
Income from operations 25.5$ 28.7$ (2.1)$ 52.1$
Restructuring costs 0.9 1.5 - 2.4
Acquisition related stock compensation expense - - 0.6 0.6
Acquisition related amortization expense 2.3 15.2 - 17.5
Non-GAAP income from operations * 28.7$ 45.4$ (1.5)$ 72.6$
Income from operations as a percent of Segment
net sales 13.1% 20.3% 16.4%
Quarter ended December 31, 2019
Reconciliation of GAAP to Non-GAAP Operating Margin
(amounts in millions)
GAAP
Operating
Income Adjustments
Non-GAAP
Operating
Income
Net sales 441.9$ -$ 441.9$
Cost of sales 284.5 - 284.5
Gross Profit 157.4 - 157.4
Operating expenses
Selling, general and administrative expenses 88.2 18.1 70.1
Research and development expenses 14.7 - 14.7
Restructuring costs 2.4 2.4 -
Income from operations 52.1$ 20.5$ 72.6$
GAAP and non-GAAP Income from operations as a
percent of net sales 11.8% 16.4%
Quarter ended December 31, 2019
*Reconciliation of 2020 Non-GAAP Net Income
Guidance and Diluted EPS Guidance (Amounts in millions except per share information)
Net Income per Share Diluted
Restructuring and consolidation costs 2.0 - 5.0
Acquisition related stock compensation expense 1.8 - 2.0
Acquisition amortization expense 68.0 - 70.0
Tax impact of above adjustments**
Non-GAAP Net Income
** Tax impact is calculated by multiplying the effective tax rate for the period of 22.0%-
24.0% by the above items.
Fiscal Year
2020
Fiscal Year 2020
Diluted earnings
per share
$99.0 - $107.9 $1.53 - $1.67
$155.0 - $168.0 $2.40 - $2.60
(15.8) - (16.9)
*Reconciliation of 2020 Non-GAAP Adjusted EBITDA
Guidance (Amounts in millions )
Net Income
Interest Expense
Tax Expense
Depreciation Expense
Amortization Expense
Stock Based Compensation
Restructuring and consolidation costs 2.0 - 5.0
Non-GAAP Adjusted EBITDA
Fiscal Year 2020
$99.0 - $107.9
$340.0 - $360.0
70.0 - 67.3
31.0 - 33.4
57.0 - 62.0
68.0 - 70.0
13.0 - 14.4
20
Appendix
Non-GAAP Adjusted EBITDA Reconciliation
EBITDA Reconciliation
(amounts in millions)
Q1 2019 Q2 2019 Q3 2019 Q4 2019 LTM
Net Income $35.2 $29.0 $25.7 $37.3 $127.2
Asset Impairment and Other, Net 1.3 (0.3) (1.3) 0.4 0.1
Taxes 10.3 9.1 5.0 (3.4) 21.0
Interest Expense, net 19.8 18.6 18.2 17.2 73.8
Depreciation Expense 14.3 14.6 14.6 14.5 58.0
Amortization Expense 17.8 17.6 17.5 17.5 70.4
Acquisition related expenses 0.5 0.2 - - 0.7
Stock Compensation Expense 3.5 3.5 3.1 3.5 13.6
Restructuring costs 2.3 3.2 6.2 2.4 14.1
Non-GAAP Adjusted EBITDA $105.0 $95.5 $89.0 $89.4 $378.9
Non-GAAP Adjusted EBITDA Margin 21.7% 20.5% 20.1% 20.2% 20.7%
21
Net Income to Adjusted EBITDA | (US$ in millions)
Altra Net Income to Adjusted EBITDA
(US$ in millions)
Year Ended December 31,
2017
Net Income $ 51.4
Interest Expense, Net 7.7
Provision for Income Taxes 19.7
Depreciation Expense 26.5
Amortization Expense 9.5
EBITDA $ 114.8
Asset Impairment and Other, Net 1.1
Loss on Write-off of Deferred Financing and
Extinguishment of Convertible Debt1.8
Acquisition Related Expenses 2.2
Loss on Partial Settlement of Pension Plans 1.7
Amortization of Inventory Fair Value Adjustment 2.3
Stock Compensation Expense 5.3
Supplier Warranty Settlement -
Restructuring and Consolidation Expense 4.1
Warranty Provision Related to Svendborg Acquisition -
Legal Fees Associated with Pursuit of Unfair Trade
Remedy-
Adjusted EBITDA $ 133.3
Source: Company filings
Fortive A&S Net Income to Adjusted
EBITDA (US $ millions)
Year Ended December 31,
2017
Net Earnings $ 151.7
Interest Expense, Net 0.5
Provision/(Benefit) for Income Taxes 41.0
Depreciation and Amortization Expenses 15.8
EBITDA $ 209.0
Stock Compensation Expense 4.4
Corporate Allocations 17.4
Additional Operational Costs to Altra (2.5)
Adjusted EBITDA $ 228.3
22
Reconciliation to Further Adjusted Pro Forma
EBITDA and Free Cash Flow | (US$ in millions)
Year Ended December 31,
Reconciliation to Further Adjusted Pro Forma EBITDA 2017
Net Income $ 78.8
Interest Expense, Net 91.8
Provision for Income Taxes 23.5
Depreciation Amortization Expenses 120.3
Pro Forma EBITDA $ 314.4
Asset Impairment and Other, Net 1.1
Loss on Write-off of Deferred Financing and Extinguishment of Convertible Debt 1.8
Acquisition Related Expenses 2.2
Loss on Partial Settlement of Pension Plans 1.7
Amortization of Inventory Fair Value Adjustment 11.2
Stock Compensation Expense 10.2
Supplier Warranty Settlement 0.0
Restructuring and Consolidation Expense 4.1
Corporate Allocations 17.4
Additional Operational Costs (2.5)
Adjusted Pro Forma EBITDA $ 361.6
Expected Cost Savings
Further Adjusted Pro Forma EBITDA
Year Ended December 31,
Reconciliation to Free Cash Flow 2017
Altra Net cash provided by operating activities $ 80.6
Altra Purchase of property, plant and equipment (32.8)
Altra Free Cash Flow 47.8
Fortive A&S Net cash provided by operating activities 171.5
Fortive A&S Purchase of property, plant and equipment (25.0)
Fortive A&S Free Cash Flow 146.5
Pro Forma Free Cash Flow $ 194.3
Source: Company filings
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