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Copyright © 2012 Rockwell Automation, Inc. All rights reserved. Rev 5058-CO900C
Rockwell Automation Investor Conference
November 8, 2012
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Safe Harbor Statement
This presentation contains statements (including certain projections and business trends) that are “forward-looking statements”
as defined in the Private Securities Litigation Reform Act of 1995. Words such as “believe”, “estimate”, “project”, “plan”,
“expect”, “anticipate”, “will”, “intend” and other similar expressions may identify forward-looking statements. Actual results may
differ materially from those projected as a result of certain risks and uncertainties, many of which are beyond our control,
including but not limited to: macroeconomic factors, including global and regional business conditions, the availability and cost of capital, the cyclical nature of our
customers' capital spending, sovereign debt concerns and currency exchange rates;
laws, regulations and governmental policies affecting our activities in the countries where we do business;
the successful development of advanced technologies and demand for and market acceptance of new and existing products;
the availability, effectiveness and security of our information technology systems;
competitive product and pricing pressures, and our ability to provide high quality products, services and solutions;
a disruption of our operations due to natural disasters, acts of war, strikes, terrorism, social unrest or other causes;
intellectual property infringement claims by others and the ability to protect our intellectual property;
our ability to successfully address claims by taxing authorities in the various jurisdictions where we do business;
our ability to attract and retain qualified personnel;
our ability to manage costs related to employee retirement and health care benefits;
the uncertainties of litigation, including liabilities related to the safety and security of the products, services and solutions we sell;
our ability to manage and mitigate the risks associated with our solutions business;
a disruption of our distribution channels;
the availability and price of components and materials;
the successful integration and management of acquired businesses;
the successful execution of our cost productivity and globalization initiatives; and
other risks and uncertainties, including but not limited to those detailed from time to time in our Securities and Exchange Commission filings.
These forward-looking statements reflect our beliefs as of the date of this presentation. We undertake no obligation to update or
revise any forward-looking statement, whether as a result of new information, future events or otherwise.
2
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Notice Regarding Financial Information
This presentation contains non-GAAP financial information.
Reconciliations from GAAP to non-GAAP measures are contained in the
appendix of this presentation.
All information should be read in conjunction with the historical financial
statements and financial information contained in Rockwell Automation’s
Annual Report on Form 10-K, periodic reports on Form 10-Q and Form
8-K, and public announcements of financial information.
Copies of these reports, as well as a financial information overview, are
available on the Investor Relations section of Rockwell Automation’s
website at http://www.rockwellautomation.com/investors/
3
Copyright © 2012 Rockwell Automation, Inc. All rights reserved. Rev 5058-CO900C
Rockwell Automation Investor Conference
Keith D. Nosbusch
Chairman and CEO
Copyright © 2012 Rockwell Automation, Inc. All rights reserved. 5
Rockwell Automation at a Glance
Fiscal 2012 Sales: $6.26B
>50% outside the U.S.
Two segments, one business
Architecture & Software
Control Products & Solutions
22,000 Employees
Serving customers for 100 + years
Technology innovation
Domain expertise
Strong culture of integrity and
corporate responsibility
Leading global provider of industrial power, control and information solutions
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Growth and Performance Strategy
6
ABOVE MARKET GROWTH Expand served market
Target highest growth
markets
Acquisitions as catalysts
REINVESTMENT Drive productivity to fund
growth opportunities with
attractive ROIC
INTELLECTUAL
CAPITAL Create customer and
shareholder value through
technology innovation and
domain expertise
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Long-Term Goals
7
Sales growth of 6 to 8%
Double digit EPS growth
> 20% Return on Invested Capital (ROIC)
Free cash flow 100% of net income
2017 goals
60% of sales outside of U.S.
30% of sales in Emerging Markets
Double Process sales
Maintain track record of above-market growth with stable cash flow
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Automation is an Attractive Market
8
$80B market growing faster than global GDP
Productivity and cost optimization
Manufacturing flexibility
Safety and sustainability
Replace aging installed base
Developed Market Growth Drivers
Market Size by Region Market Size by Industry
Infrastructure investment
Growing middle class
Extraction of natural resources
Wage inflation
Emerging Market Growth Drivers
Heavy
Consumer
Other
Transportation
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Customer Value Propositions
9
Design productivity
Intelligent devices
Flexible production to respond to customer trends
Life cycle management
Technology migration
Energy management
Operator effectiveness
Manufacturing intelligence
Reliability, quality
Diagnostics, predictive maintenance
Asset management
Global support
Safe and secure operating environment
Regulatory compliance
Sustainability
Brand and image protection
Copyright © 2012 Rockwell Automation, Inc. All rights reserved. 10
Differentiation is the Key
Customer Value
Technology Innovation
Domain Expertise
Broad Portfolio
Market Access Model
Global Support
Trusted Partners
Maximizing customers’ return on their automation investment
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
$0.0
$2.0
$4.0
$6.0
2008 2009 2010 2011 2012 2013
$3.79
$1.44
$3.10
$4.89$5.29
Adj
uste
d E
PS
$
Track Record of Execution
11
Stable Free Cash Flow
Above Market Sales Growth Sales Diversification
Adjusted EPS
$536
$5.75 $5.35
Actual Results Nov 5th 2012 Guidance
0%
10%
20%
30%
2005 2012
6%
15%13%
22%
Sal
es a
s P
erce
ntag
e of
RO
K
Process Initiatives Emerging MarketsActual Results Nov 5th 2012 Guidance Process Initiative Emerging Markets
Free Cash Flow Pension Contributions
$6.65
$6.35
$508 $531
$773
$458 $431
$545
$672
$0
$200
$400
$600
$800
2005 2006 2007 2008 2009 2010 2011 2012
Fre
e C
ash
flo
w (
in $
mill
ion
s)
Copyright © 2012 Rockwell Automation, Inc. All rights reserved. 12
Keys to Success
Continued enhancements of
PlantPAx
Leverage power, control and safety
portfolio
Expand application libraries and
tools
Increase penetration of mid-range
portfolio
Maintain segment focus
Expand productivity tools
Invest in customer-facing
resources
Develop channel capabilities
Domain expertise acquisitions
Continue to scale Logix , evolve
visualization
Expand intelligent motor control
platforms
Increase packaged solutions and
services
New Products
OEM Process
Emerging Markets
Copyright © 2012 Rockwell Automation, Inc. All rights reserved. Rev 5058-CO900C
Process and OEM Growth Opportunities
Frank Kulaszewicz
Senior Vice President,
Architecture & Software
Blake Moret
Senior Vice President,
Control Products & Solutions
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Driving customer value…
Integrated Architecture
centered on the Logix
Platform
Intelligent Motor Control
(IMC)
Solutions and Value-add
Services
… through three platforms to maximize our customers’ return on their automation investment
14
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Integrated Architecture – Logix Platform
15
Multidiscipline
Integrates six control disciplines
Common development environment streamlines
design, training & maintenance
Scalable
Matched to customer requirements
Built to protect legacy investments
Information-enabled and open
Designed to integrate easily with information
systems
Based on open, accepted industry standards
Large and growing installed base
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Intelligent Motor Control (IMC)
A large, fast-growing part of the automation market,
driven by:
Strong resource markets
Manufacturer’s needs for flexibility
Industrial energy management
Precision control of motors provides process
productivity and energy savings
We differentiate by providing both high-performance
motor control, and the easiest way to integrate the
devices that control these motors
Intelligent motor control is integral to the automation system
16
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Technology Leverage
Life Cycle View
Globalization
Remote Services
Domain Expertise
Services and Solutions
Enterprise Risk Management
Asset Utilization and Optimization
Faster Time to Market
Lower Total Cost of Ownership
We win by leveraging our strengths to provide customer value
17
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Remote Services
18
Customers are asking for remote application support and
monitoring to complement traditional product support
Remote services leverage our multi-discipline control platform A common approach can be developed for process and discrete
applications
Standard unmodified Ethernet provides a high-performance backbone
Multiple assets throughout the plant can be monitored on a single
network
Related network design and security services are increasingly
desired and leverage our relationship with Cisco
Machine builders seeking to develop their recurring support
revenue are also turning to us for technology infrastructure
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Customer Validation
19
A formal partnership driving business value
for both companies
A broad range of process and discrete
applications utilizing…
Integrated Architecture Multidiscipline control including safety
High availability
Scalability… start with what was needed
and grow
Intelligent Motor Control Coordinated drive systems
Solutions and Value-add Services Local support and technical expertise
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Process …continues to be our best growth opportunity
20
Integrated Architecture
Solutions and Services
Intelligent Motor Control
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Process …continues to be our best growth opportunity
21
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Process Market
Our process sales have grown at
22% CAGR since 2005
Largest served market expansion
Winning greenfield and brownfield
projects in both batch and
continuous process applications
22
Process PAM ~$35B
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Faster Time to Market Agility
Design and commissioning productivity
Asset Utilization Monitoring and diagnosis of asset health
Manufacturing intelligence
Total Cost of Ownership Life cycle management
Open communication standards
Migration strategy
Enterprise Risk Management Domain expertise
Regulatory compliance
Safety
Process Drivers
23
Integrating information, control, power and safety for optimized operations
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Process – Strategy Execution
Exp
an
de
d S
erv
ed
Ma
rket
Acquisitions
Developments
Partnerships
’05 ’06 ’07 ’08 ’09 ’10
ProcessLogix
Batch/Hybrid
Fieldbus, E&H
Integration
Asset Management Unified DCS Architecture
Virtualization
ICS Triplex Pavilion Tech. Incuity
Proscon Hengsheng Hinz Hiprom
ControlNet-based
architecture
Logix +
ViewSE
Engineering Libraries
Plant Asset Mgmt
EtherNet-based
architecture
’11 ’04 ’12
Virtualization
Innovative technology, domain expertise and partners – a winning combination
Harbin Jiuzhou
24
High Availability on
EtherNet
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Customer Validation
25
Warwick Chemicals is the world’s
largest manufacturer of bleach
activators. Every major detergent
producer uses their products.
Customer requirements Open connectivity with third-party systems
Scalability
Local service and support
Advanced control strategies
Ability to develop and enhance the system
to meet process changes
Multi-phase project will replace a legacy DCS system with PlantPAx
Results
Total cost of ownership over 15 year operating life key to Rockwell selection
Multi-year project – initial phase completed (waste water treatment plant)
System engineering on time and on budget
Real-time operator information
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Customer Validation
26
Located in Lawrenceburg, Tennessee
Facility expansion… greenfield plant to double
production Existing plant control used competitor’s current
technology
Long-term relationship with customer, but Rockwell
Automation was not used for distillation control
Requirements One system for multidiscipline control
Visibility/connectivity to valves, instruments and
motor control
Diagnostic and preventive maintenance tool
Remote access capability
Results Met implementation
timeline
Maintained product quality
Optimized production and increased capacity
Safer work environment
Our market access strategy includes working with partners to meet customer needs
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Customer Validation
27
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Metals Dubai Aluminum
Company
Pot-line control system Middle East $10M
Chemical Cynar PLC Waste plastic to fuel
conversion plant
United
Kingdom
$11M
Oil and
Gas
Daewoo Shipbuilding
& Marine
Control and safety
systems
South Korea $6M
Mining Freeport-McMoRan Extraction and
processing
USA $2M
Life
Sciences
Large biotech
company
Batch management for
active ingredients
UK $2M
Process Wins, FY2012
Market adoption in key verticals in all regions
28
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
OEMs …important in every vertical
29
Integrated Architecture
Solutions and Services
Intelligent Motor Control
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
OEMs …important in every vertical
30
Manufacturing
and Assembly
Material
Handling
Packaging
Process
Power and
Energy
Converting,
Print, Web
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
OEM Market is Significant
Market Dynamics
OEMs have greater influence on end-user decisions
Asia is the fastest growing market
Portfolio additions have allowed us to expand our served market
31
~$25B PAM
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
OEM Drivers
Faster Time to Market
Productivity and design tools
Reusable engineering
Simulation and emulation for digital design versus
physical prototypes
Integrated control, power, safety and information
Global support
Improved Asset Utilization and Optimization
Reliability, quality
Machine performance
Diagnostics and remote monitoring
32
Shorten the time to design, develop and deploy new machines
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Standalone Machine Midrange Machine Complex Machine
Scalability for OEMs
33
Comprehensive solutions allowing OEMs to choose the most cost effective
solution for their machine
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
OEM Market – Strategy Execution
Continuing to build on our OEM success
Product
Development
• Midrange offerings
• Integrated Drive
Motor
• Multidiscipline
control
Market Access
• Technical
resources to
assist OEMs
Global Support
• Remote Support
Centers
• Field Service
Professionals
• Network and safety
consulting
OEM Programs
• Growing Machine
Builder Program
34
Expanding Served Market
Productivity Tools
• Design tools /
Mechatronics
• Libraries
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Customer Validation
Design tools accelerate machine design
process
Mechatronics design software integrated with
Rockwell Automation partner Dassault Systèmes
Integrated platform for machine, motion and
safety control
Products
Results
Faster design and installation
Improved machine throughput and reliability
Improved energy efficiency
35
Design Tools
ControlLogix controller
PowerFlex Drives
Kinetix 6000 servos
PanelView HMI
Remote I/O
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Customer Validation
36
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Packaging North
America
Aagard All in one continuous wrap around
cartoner system
Packaging Asia
Pacific
Samwoo End of line packaging solutions
Material
Handling
North
America
Rangeland Inc. Oil and gas pipe sorter
Process EMEA SobaTech Continuous dosing, mixing and
kneading dough system
Converting,
Print, Web
EMEA MTorres Automatic unwinding splicer for tissue
industry
OEM Recent Wins
Market success… key segments… all regions of the world
37
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Driving Continued Success
38
… through sustained differentiation
Copyright © 2012 Rockwell Automation, Inc. All rights reserved. Rev 5058-CO900C
Rockwell Automation Financial Overview
Ted Crandall
Senior Vice President and Chief Financial Officer
November 8, 2012
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Fiscal 2012 Results
40
Sales $6.26B
Sales Increase (Excluding Currency) 7%
Currency Translation (3)%
Segment Operating Margin 18.1%
Diluted EPS $5.13
Free Cash Flow* 81% of Net Income
*After a discretionary pre-tax pension contribution of $300M to the company's U.S. pension trust.
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Introducing New Earnings Measures to Exclude Non-Operating Pension Costs
41
Improve transparency into core business
performance
Remove components of pension expense
tied primarily to financial market factors
Provide more relevant historical
comparisons for underlying operating
performance
Components of Pension Expense
Service Cost
Operating
Non-
Operating
Prior Service Cost
Interest Cost
Expected Return on Plan Assets
Actuarial Gains/(Losses)
Plan Curtailments &
Settlements/Transition
Obligations
Introducing new non-GAAP measures of Adjusted Income and Adjusted EPS and
redefining Segment Operating Earnings starting in fiscal 2013
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Operating & Non-Operating Pension Costs
42
Year ended September 30,
2013 B/(W)
2013* 2012 2008 2012 2008
Service Cost 93$ 72$ 58$ (21)$ (35)$
Prior Service Cost (3) (2) (4) 1 (1)
Operating Pension Cost 90$ 70$ 54$ (20)$ (36)$
Interest Cost 161$ 168$ 150$ 7$ (11)$
Expected Return on Plan Assets (227) (228) (194) (1) 33
Actuarial Loss 145 95 19 (50) (126)
Non-Operating Pension Cost 79$ 35$ (25)$ (44)$ (104)$
Total Pension Expense 169$ 105$ 29$ (64)$ (140)$
($ millions)
* Forecasted FY2013 expense as of November 5, 2012
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Reconciliation of Fiscal 2012 GAAP to New Earnings Measures
43
Total Segment Operating Earnings 1,131.4$ 32.5$ 1,163.9$
Purchase Accounting Depreciation and Amortization (19.8) - (19.8)
General Corporate - Net (85.6) 2.7 (82.9)
Interest Expense (60.1) - (60.1)
Income from Continuing Operations before Taxes 965.9 35.2 1,001.1
Income Tax Provision (228.9) (12.6) (241.5)
Income from Continuing Operations 737.0$ 22.6$ 759.6$
Diluted EPS from Continuing Operations 5.13$ 0.16$ 5.29$
Segment Operating Margin 18.1% 0.5 pts 18.6%
Effective Tax Rate 23.7% 0.4 pts 24.1%
Supplemental data on historical pension-adjusted results can be found on Rockwell Automation's investor relations website
http://www.rockwellautomation.com/investors/
FY 2012
FY 2012
Adjusted
(Non-GAAP)
Adjustment for
Non-Operating
Pension Cost
($ millions, except per share amounts)
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Fiscal 2013 Guidance
44
Sales $6.35B to $6.65B
Organic Growth 1% to 5%
Currency Translation & Acquisitions ~1%
Segment Operating Margin ~18.7%
Adjusted EPS $5.35 to $5.75
Free Cash Flow ~100% of Adjusted Income
Note: As of November 5, 2012
Copyright © 2012 Rockwell Automation, Inc. All rights reserved. 45
Total Shareowner Return
$25
$50
$75
$100
$125
$150
$175
$200
$225
2004 2005 2006 2007 2008 2009 2010 2011 2012
Fiscal Year Ended September 30
Rockwell Automation S&P 500 Index
..
• Includes the reinvestment of all dividends in our common stock
2005-2012 annualized total return of 10.0% vs 5.4% for the S&P 500
Copyright © 2012 Rockwell Automation, Inc. All rights reserved. 46
Rockwell Automation A Great Investment
Expanding served market
Expanding product, solutions and services portfolio
Diversification – industries, applications and geographies
Expanding growth opportunities
Technology leader…focused on innovation
Domain expertise
Unique market access model
Competitive differentiation
Productivity, flexibility, safety and sustainability in developed markets
Infrastructure and growing consumer demand in emerging markets
Automation markets grow in excess of GDP
Strong balance sheet and cash flow generation
Best in class ROIC; an intellectual capital business
Financial strength; disciplined cash deployment
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Appendix
Reconciliation to Non-GAAP Measures
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Reconciliation to Non-GAAP Measures
48
Fiscal 2013 Year Ended September 30,
Guidance 2012 2011 2010 2009 2008
Diluted EPS from continuing operations $5.00 - $5.40 5.13$ 4.79$ 3.05$ 1.53$ 3.89$
Non-operating pension costs per diluted share, 0.56 0.25 0.16 0.07 (0.14) (0.17)
before tax
Tax effect on non-operating pension costs
per diulted share (0.21) (0.09) (0.06) (0.02) 0.05 0.07
Adjusted EPS $5.35 - $5.75 5.29$ 4.89$ 3.10$ 1.44$ 3.79$
Adjusted EPS
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Reconciliation to Non-GAAP Measures
49
(in millions)
Twelve Months Ended September 30,
2012 2011 2010 2009 2008 2007 2006 2005
Cash provided by continuing operating activities 718.7$ 643.7$ 494.0$ 526.4$ 596.8$ 444.9$ 313.3$ 548.3$
Capital expenditures of continuing operations (139.6) (120.1) (99.4) (98.0) (151.0) (131.0) (122.3) (102.7)
Tax payments related to the gain on divestiture of
Power Systems - - - - 7.9 190.0 - -
Excess income tax benefit from share-based
compensation 18.5 38.1 16.1 2.4 4.6 27.1 47.4 -
Free cash flow 597.6$ 561.7$ 410.7$ 430.8$ 458.3$ 531.0$ 238.4$ 445.6$
Free Cash Flow
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Reconciliation to Non-GAAP Measures
50
Organic Sales(in millions, except percentages)
2011
Sales
Effect of Excluding
Changes in Changes in Effect of Organic
Sales(a) Currency Currency(b) Acquisitions Sales(c) Sales(d)
Architecture & Software 2,650.4$ 73.5$ 2,723.9$ -$ 2,723.9$ 2,594.3$ 2% 5% 5%
Control Products & Solutions 3,609.0 92.4 3,701.4 (36.7) 3,664.7 3,406.1 6% 9% 8%
Total 6,259.4$ 165.9$ 6,425.3$ (36.7)$ 6,388.6$ 6,000.4$ 4% 7% 6%
Growth Ex-currency Growth
(a)/(d) (b)/(d) (c)/(d)
Twelve Months Ended September 30,
2012
Sales
Sales Growth Organic
Copyright © 2012 Rockwell Automation, Inc. All rights reserved.
Reconciliation to Non-GAAP Measures
51
Segment operating margin(in millions, except percentages) Twelve Months Ended
September 30, 2012
Sales
Architecture & Software (a) 2,650.4$
Control Products & Solutions (b) 3,609.0
Total sales (c) 6,259.4$
Segment operating earnings
Architecture & Software (d) 702.8$
Control Products & Solutions (e) 428.6
Total segment operating earnings (f) 1,131.4
Purchase accounting depreciation and amortization (19.8)
General corporate - net (85.6)
Interest expense (60.1)
Income from continuing operations before income taxes 965.9$
Segment operating margin:
Architecture & Software (d/a) 26.5%
Control Products & Solutions (e/b) 11.9%
Total segment operating margin (f/c) 18.1%