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| ©2019 Belden Inc. belden.com @beldeninc1
Belden OverviewQ1 2019
| ©2019 Belden Inc. belden.com @beldeninc2Adjusted results. See investor.belden.com for reconciliation to comparable GAAP results.1. 2005 – 2018
Belden Overview
Operational ExcellenceDisciplined Capital AllocationProven Management Team
DEPLOYS A Robust Business System
Revenue CAGR +6%FCF CAGR +14%
DELIVERSStrong, Consistent Results1
EBITDA +980 bps ROIC +850 bps
BandwidthVideo Consumption
BENEFITS From Favorable Secular Trends
Industrial AutomationSmart Buildings
What is Belden? A Leading Global Connectivity Company that …
SERVES Two Primary End-Markets
EnterpriseIndustrial
| ©2019 Belden Inc. belden.com @beldeninc3
Belden Overview
KEY MARKETS
IndustrialDiscrete ManufacturingProcess FacilitiesTransportationEnergy
EnterpriseSmart BuildingsFinal Mile BroadbandLive Media Production
Data
Audio
Video
Connectivity
Cable
Networking
Software
APPLICATIONS SOLUTIONS
A Leading Global Connectivity Company
| ©2019 Belden Inc. belden.com @beldeninc4
Transmitting and Securing Data, Sound, and Video in Complex Enterprise and Media Networks
Fiber Copper A/V
KEY SOLUTIONS
Enterprise
Smart Buildings
KEY MARKETS
Cable Connectivity Networking Software
Fiber Copper A/VRacks Connectivity Tools
Cameras Switchers ReplayRouting Playout
Extended LAN Commercial A/V Broadband Deployment (Fiber/Copper) Live News and Sports Production Stadium Infrastructure
Final Mile Broadband Live Media Production
Editing Playout Asset ManagementAutomated Production Control
Non-GAAP results. See investor.belden.com for reconciliation to comparable GAAP results.1. 2018 Results
17.6% EBITDA Margins1
$1.5B Revenue1
| ©2019 Belden Inc. belden.com @beldeninc5
Fiber Copper
KEY SOLUTIONS
Industrial
Discrete Manufacturing Process Facilities Transportation Energy
KEY MARKETS
Cable Connectivity Networking Software
Active I/O Modules Passive Distribution Boxes Connectors
Wireless Gateways Switches Routers Security Configuration Management FirewallsNetwork Management Vulnerability Management
Factory Floor Automation Process Automation Transportation Control Systems and Wireless
Smart Grid Infrastructure
Transmitting and Securing Data, Sound, and Video in Harsh Industrial Environments 19.4% EBITDA Margins1
$1.1B Revenue1
Non-GAAP results. See investor.belden.com for reconciliation to comparable GAAP results.1. 2018 Results
| ©2019 Belden Inc. belden.com @beldeninc6
Proven Track Record
REVENUE EBITDA MARGIN
FREE CASH FLOW
RETURN ON INVESTED
CAPITAL1
2005 $1.246B 8.5% $37M 4.1%
2018 $2.592B 18.3% $193M 12.6%
Variance 6% CAGR Improvement of 980 bps 14% CAGR Improvement of
850 bps
Non-GAAP results. See investor.belden.com for reconciliation to comparable GAAP results.1. Excluding excess cash.
SIGNIFICANTLY IMPROVED FINANCIAL PERFORMANCE
| ©2019 Belden Inc. belden.com @beldeninc7
REVENUE MIX
Improved Portfolio Composition
DIVESTED Lower-margin cable
ACQUIRED Higher-margin software,
networking, and connectivityCABLE
CONNECTIVITY
CABLE
CONNECTIVITY
NETWORKING
SOFTWARE
REVENUE MIX
2005
2018
1.2BRevenues
Gross Profit
21
$
%
2.6BRevenues
Gross Profit
40
$
%
| ©2019 Belden Inc. belden.com @beldeninc8
EBITDA Margin (%)1
1. Non-GAAP results. See investor.belden.com for reconciliation to comparable GAAP results
Consistent Margin Progression
CONSISTENT MARGIN EXPANSION
9.4%
11.2%
13.6%
10.0%
11.8% 11.9% 11.7%
13.0%
15.7% 15.5%
17.0%
18.3% 18.2% 18.3%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
22.0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
EBITDA Margin Goal: 20 - 22%
Prior EBITDA Margin Goal: 18 - 20%
| ©2019 Belden Inc. belden.com @beldeninc9
Favorable Secular Trends
INDUSTRIALAUTOMATION
Increasing pressure
to automate production
SMARTBUILDINGS
Integrated networks require
connectivity
BANDWIDTH
Insatiabledemand for high-speed
internet
VIDEO CONSUMPTION
Increasing quality and quantity
of video consumption
| ©2019 Belden Inc. belden.com @beldeninc10
2017 Leverage onOrganic Growth
Mix Productivity 2020
Adjusted results. See investor.belden.com for reconciliation to comparable GAAP results.1. Assuming 4% organic revenue CAGR.
THE BELDEN BUSINESS SYSTEM WILL CONTINUE TO DRIVE MARGIN EXPANSION
130 bps1
60 bps
90 bps 21.0%
A Path to Increased Profitability
18.2%
| ©2019 Belden Inc. belden.com @beldeninc11
SIGNIFICANTLY IMPROVED BALANCE SHEET
A Quality Balance Sheet with Long-Term Maturities
Fixed, Long-Term MaturitiesEuro-Denominated
Debt Improves Earnings Exposure to the Euro
Pre-Tax Cost of Debt= 3.5%
(millions)
$340
$227
$510
$397
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 1111
(millions)
As of 2.21.191. Euro-denominated debt. Using 1.134 EUR / USD FX rate.
| ©2019 Belden Inc. belden.com @beldeninc12
EPS Accretion from Capital Deployment
9%
$100M $0.16
$300M $0.48
$500M $0.80
$700M $1.12
ROIC
Deployed Capital
YEAR 1
| ©2019 Belden Inc. belden.com @beldeninc13Adjusted results. Please see appendix for comparable GAAP results. 1. Constant currency. 2. ROIC excluding excess cash.
3-YEAR FINANCIAL GOALS(2017 – 2020)
RevenueCAGR1 5-7%
EBITDA Margin 20-22%
Free Cash FlowCAGR 13-15%
Return on Invested Capital2 13-15%
3-Year Financial Goals
| ©2019 Belden Inc. belden.com @beldeninc14
Investment Thesis
Attractive Valuation3
Proven Track Record 2005 - 2018
EBITDA Margin Upside
Secular Tailwinds
Accretive M&A Potential
Revenue +6% CAGR to $2.6B | EBITDA +980 bps to 18.3% | FCF +14% CAGR to $193M | ROIC +850 bps to 12.6%
15.5% in 2014 | 18.3% in 2018 | 20-22% goal by 2020
Industrial Automation | Smart Buildings | Video Consumption | Bandwidth
~$0.16 -$0.18 EPS accretion per $100M deployed2
8.5x EV/EBITDA | 10x P/E | 7% FCF Yield
Adjusted results. See investor.belden.com for reconciliation to comparable GAAP result. 1. Management’s best estimate. Estimated cash available for deployment from organic activities.2. Expectations for year-one assuming 9 -10% ROIC.3. Stock price as of 2/21/12019. Denominator based on 2019E
| ©2019 Belden Inc. belden.com @beldeninc15
4th Quarter 2018 Earnings Release Conference Call
February 20, 2019
| ©2019 Belden Inc. belden.com @beldeninc16
Our commentary and responses to your questions may contain forward-lookingstatements, including our outlook for the first quarter and full-year 2019. Forward-lookingstatements include projections of sales, earnings, general economic conditions, marketconditions, working capital, market shares, free cash flow, pricing levels, and effectivetax rates. Belden undertakes no obligation to update any such statements to reflectlater developments, except as required by law. Information on factors that could causeactual results to vary materially from those discussed today is available in the pressrelease announcing 2018 fourth quarter results, our most recent Quarterly Report onForm 10-Q as filed with the SEC on November 5, 2018 (including those discussed in“Management’s Discussion and Analysis of Financial Condition and Results ofOperations” in Part I, Item 2 and under “Risk Factors” in Part II, Item 1A), and oursubsequent filings with the Securities and Exchange Commission.
Safe Harbor Statement
Non-GAAP MeasuresOn this call we will discuss some non-GAAP measures (denoted by footnote) indiscussing Belden’s performance, and the reconciliation of those measures to the mostcomparable GAAP measures is contained within this presentation or available at ourinvestor relations website, investor.belden.com.
| ©2019 Belden Inc. belden.com @beldeninc17
• Revenues of $654.1M, increasing 8.1% year-over-year and 6.8% organically
• EBITDA of $121.6M, increasing 10.4% year-over-year
• EPS of $1.66, increasing 2.5% year-over-year
• Reduced leverage to 2.2x net debt to EBITDA
• Completed the $200M share repurchase program, announced a new $300M authorization
Q4 2018 Highlights
Adjusted results. See Appendix for reconciliation to comparable GAAP results..All references to Earnings Per Share refer to adjusted net income per diluted share attributable to Belden common stockholders
| ©2019 Belden Inc. belden.com @beldeninc18
• Record revenues of $2.592B, increasing 8.5% year-over-year
• Record EBITDA of $474.2M, increasing 9.2% year-over-year
• Record EPS of $6.06, increasing 13.3% year-over-year
• Cash flow from operations of $289.2M, increasing 13.3% year-over-year
• Balanced capital deployment included a record $175M for share repurchases, $103M for acquisitions, and $98M for capital expenditures
FY 2018 Highlights
Adjusted results. See Appendix for reconciliation to comparable GAAP results..All references to Earnings Per Share refer to adjusted net income per diluted share attributable to Belden common stockholders
| ©2019 Belden Inc. belden.com @beldeninc19
Revenue $274.7M
Organic Growth % (Y/Y) +6.0%
EBITDA Margin 19.8%
Revenue $379.4 M
Organic Growth % (Y/Y) +7.4%
EBITDA Margin 17.8%
Q4 2018 Segment Overview
EnterpriseSolutions
IndustrialSolutions
Key Markets
• Smart Buildings
• Final Mile Broadband
• Live Media Production
• Discrete Manufacturing
• Process Facilities
• Transportation
• Energy
• Cybersecurity
| ©2019 Belden Inc. belden.com @beldeninc20
Q4 2018 Financial Summary
Adjusted results. See Appendix for reconciliation to comparable GAAP results.(1) All references to Net Income refer to adjusted net income attributable to Belden (2) All references to Earnings Per Share refer to adjusted net income per diluted share attributable to Belden common stockholders
Q4 2018 Q3 2018 Q4 2017
Revenue $654.1M $659.0M $604.9M
Gross profit $265.6M $270.1M $237.7M
Gross profit percentage 40.6% 41.0% 39.3%
EBITDA $121.6M $126.7M $110.2M
EBITDA percentage 18.6% 19.2% 18.2%
Net Income(1) $77.7M $81.9M $79.0M
Earnings Per Share(2) $1.66 $1.72 $1.62
| ©2019 Belden Inc. belden.com @beldeninc21
Q4 2018 Segment Results
Adjusted results. See Appendix for reconciliation to comparable GAAP results.(1) Consolidated results include income / (loss) from our equity method investment, Non-operating pension costs and Eliminations
EnterpriseSolutions
Industrial Solutions Consolidated
Q4 2018
Revenue $379.4M $274.7M $654.1M
EBITDA(1) $67.7M $54.3M $121.6M
EBITDA Margin 17.8% 19.8% 18.6%
Q3 2018
Revenue $392.1M $266.9M $659.0M
EBITDA(1) $72.2M $53.8M $126.7M
EBITDA Margin 18.4% 20.1% 19.2%
Q4 2017
Revenue $332.4M $272.5M $604.9M
EBITDA(1) $48.5M $60.5M $110.2M
EBITDA Margin 14.6% 22.2% 18.2%
| ©2019 Belden Inc. belden.com @beldeninc22
Q4 2018 Balance Sheet Highlights
(1) Net leverage is calculated as (A) total debt less cash and cash equivalents divided by (B) trailing twelve months Adjusted EBITDA plus trailing twelve months stock based compensation expense.
Q4 2018 Q3 2018 Q4 2017
Cash and Cash Equivalents $421M $329M $561M
Working Capital Turns 9.5x 6.2x 8.2x
Days Sales Outstanding 65 66 71
Inventory Turns 5.0x 4.9x 5.1x
PP&E Turns 7.2x 7.5x 7.2x
Total Debt Principal Amount $1.49B $1.53B $1.58B
Net Leverage(1) 2.2x 2.5x 2.3x
| ©2019 Belden Inc. belden.com @beldeninc23
Q4 2018 Q4 2017 FY 2018 FY 2017
Cash flows from operating activities
$188.4M $151.7M $289.2M $255.3M
Less: Net capital expenditures(1) $34.4M $29.8M $96.2M $63.2M
Free cash flow(2) $154.0M $121.9M $193.0M $192.1M
Cash used to acquire businesses(3)(4)
$0.0M $0.0M $84.6M $166.9M
Dividends / Share Repurchases $60.8M $24.3M $218.2M $68.4M
Q4 2018 Cash Flow Highlights
(1) Capital expenditures, net of proceeds from the disposal of tangible assets. See Appendix for reconciliation.(2) Free cash flow is not a term defined by generally accepted accounting principles (GAAP) and our definition may or may not be used consistently with other companies that define this term.
See Appendix for reconciliation to comparable GAAP results.(3) Net of cash acquired.(4) Includes a $19.3 million payoff of debt acquired from the acquisition of Snell Advanced Media (“SAM”).
| ©2019 Belden Inc. belden.com @beldeninc24
Outlook
(1) Adjusted Outlook. See Appendix for reconciliation to comparable GAAP outlook.(2) All references to Earnings Per Share refer to adjusted net income from continuing operations per diluted share attributable to Belden common stockholders.
Full Year 2019• Revenue of $2.495 - $2.595 billion• Earnings Per Share(1)(2) of $5.50 - $6.15
Full Year 2019 Assumptions• Interest expense of $59 million• Tax rate of 21%• No impact of potential 2019 M&A and share repurchases
Q1 2019• Revenue of $564 - $594 million• Earnings Per Share(1)(2) of $0.80 - $1.00
| ©2019 Belden Inc. belden.com @beldeninc25
2019 High End of Guidance
Management’s best estimate. Adjusted results. See appendix for reconciliation to comparable GAAP results.
$2.592B $2.595B
Revenue
Adjusted EPS
($34M)
• Organic growth when adjusted for changes in copper / currency is -2% to +2% • This guidance does not include the impact of future capital deployments
$9M ($22M)
$6.06
($0.35) $0.28 ($0.09)$6.15
$50M
$0.25
| ©2019 Belden Inc. belden.com @beldeninc26
Appendix
| ©2019 Belden Inc. belden.com @beldeninc27
Select Belden Peers
ENTERPRISE INDUSTRIAL
CommScope (COMM): Smart Buildings
Corning (GLW): Smart Buildings
Evertz (ET-T): Live Media Production
Harmonic (HLIT): Live Media Production
AVID (AVID): Live Media Production
Amphenol (APH): Cable and Connectivity Products
TE Connectivity (TEL): Connectivity Products
Cisco (CSCO): Networking Products
Qualys (QLYS): Security Products
Rockwell (ROK): Industrial Markets
| ©2019 Belden Inc. belden.com @beldeninc28
Industrial Automation
Sources: “The Skills Gap in Manufacturing”, Deloitte, 2015; Bureau of Economic Analysis; Eurostat; Federal Reserve.
DRIVING IP ADOPTIONIP BENEFITS IP CHALLENGES
TRENDS ASSET REPLACEMENT INDICATORS
FLEXIBILITY …
LABOR SUBSTITUTION …
SHORTER LEAD-TIMES
LOWER COST OF CAPITAL
AGING EQUIPMENT …
CAPACITY UTILIZATION AT MULTI-YEAR HIGHS …
84%
EU
77%
UNITED STATESPRODUCT CUSTOMIZATION
20252MUnfilled
manufacturing jobs globally
2015
SKILLS GAP AND WAGE INFLATION
Connect new technologies with legacy systems
Collaboration between operationaland information technologies
Manage security risks
Factory connected to the enterprise
Remote access
Open standards
2016 = 7.7 yearsAverage age of manufacturing assets highest since 1951
| ©2019 Belden Inc. belden.com @beldeninc29
Smart Buildings
Driving Investment … High-Spec Copper Cabling
Cat 6A+26% CAGR1
(2015 – 2021)
ConnectivityLAN Connectivity Points
+3% CAGR1
(2015 – 2021)
Audio/Visual
Lighting
Fire/Alarm
HVAC
Control/Instrumentation
Local Area Network
Security
1. “Convergence and Digitization of Commercial Buildings in U.S.”, BSRIA, May 2017.
Deliver New User Experiences
Enable BusinessAnalytics
Improve Efficiency and Sustainability
| ©2019 Belden Inc. belden.com @beldeninc30
CREATING CHALLENGES FOR OUR CUSTOMERS
LIVE BROADCAST63% of television ad spend is allocated to live events vs. pre-produced content
BROADCASTERS NEED TO ADOPT IP TECHNOLOGIES TO ADDRESS THESE CHALLENGES
Video Consumption
VIDEO CONSUMPTIONIS CHANGING
VIDEO QUALITY51% CAGR of UHD televisions installed (2016 – 2021)
VIDEO FORMATS26% CAGR of over-the-top subscribers (2014 – 2017)
UHD CONTENT CREATIONRequires higher bandwidth than legacy protocols can provide
DELIVERING CONTENT ON MULTIPLE PLATFORMSChallenges existing workflow
Sources: Cisco VNI, 2017; Bloomberg; Major Networks.
PRODUCING LIVE EVENTSIs complex and has the highest cost of failure
| ©2019 Belden Inc. belden.com @beldeninc31
Bandwidth
Creating Opportunityfor our Customers …
… Driving Significant Investment
Internet traffic will grow 3x by 2021
Video traffic will exceed 80% in 2021
Today,the number of NETWORKEDDEVICES
MSO revenue per high-speed data user
= 2XGlobal
Population
2014 2017 2020E
$44.94$52.75
$60.80
Sources: Cisco VNI, 2017; SNL Global Market Intelligence, 2017; Sell-side consensus estimates as of 10/9/17.
By 2021,the number of NETWORKEDDEVICES
= 4XGlobal
Population
73% of internet traffic today is video
Global fixed broadband speeds will double by 2021