Timken : First Quarter 2026 Q1 2026 Earnings Presentation

Published: 2026-05-06 07:08:19 ET TKR

Published on 05/06/2026 at 07:08 am EDT

1Q 2026 Earnings Investor Presentation

May 6, 2026

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Investor Day

May 20, 2026

New York City

1Q 2026 Highlights

$1.2B

Sales

+8% YOY Reported

+4.3% YOY Organic

18.8%

Adjusted

EBITDA Margin

+60 bps YOY

$1.67

Adjusted EPS

+19% YOY

M&A

Acquired Bijur Delimon to accelerate growth

282K

Shares repurchased during the quarter

2.1x

Net Debt/ Adj. EBITDA

Delivered better than expected 1Q-26 results

Expanded sales, margins and EPS versus prior year

Backlog up sequentially and year-over-year

Advanced 80/20 actions

Raising 2026 Adj. EPS outlook to $5.75-$6.25, up

~13% YOY at the midpoint

See appendix for reconciliations of organic revenue, adjusted EBITDA, adjusted EBITDA margins, adjusted EPS, net debt, and the ratio of net debt to adjusted EBITDA to their most directly comparable GAAP financial measures. Certain data contained in the table above has been rounded for presentation purposes.

Acquisition of Bijur Delimon

Passenger Rail

Expands Timken's Industrial Motion

portfolio in key market verticals

Leading manufacturer of automated lubrication systems

Power Generation

Mining

Strong customer relationships in key market verticals: rail, power gen, mining

Expected to be accretive to Industrial

Motion segment margins post synergies

CY2026 revenue expected: >$60M

Progress on Near-Term Strategic Priorities

Delivering stronger performance in 2026

Raising full-year financial outlook

Raising the growth profile

Acquisition of Bijur Delimon accelerates growth in key market verticals

Early momentum on regional expansion opportunities

Advancing 80/20 actions

Divestiture of belts business to structurally improve margins

Teams actively deploying 80/20 across the enterprise to reduce complexity

1Q 2026

Performance Highlights

1Q 2026 Financial Overview

Net Sales ($M) Adjusted EBITDA ($M) Earnings Per Share

$1,231

+8.0%

18.8%

18.2%

$208

$231

REPORTED (GAAP) ADJUSTED

$1.67

$1.40

$1.11

$1,140

1Q-25 1Q-26

1Q-25 1Q-26 1Q-25 1Q-26

See appendix for reconciliations of adjusted EBITDA, adjusted EBITDA margin, and adjusted EPS to their most directly comparable GAAP financial measures.

1Q 2026 Financial Highlights - Sales

($M)

+3.4%

+0.3%

+4.3%

+8.0%

$1,140

$49 $3

$39

$1,231

1Q-26 vs. 1Q-25 Sales by Geography - ORGANIC

(Excludes Acquisitions and Currency impact)

+5%

EMEA

+6%

Americas

-1%

Asi ific

a-Pac

1Q-25 Organic Acquisitions Currency 1Q-26

Certain data contained in the bar graph above has been rounded for presentation purposes.

1Q 2026 Financial Comparison - Adjusted EBITDA

($M) $32

18.8%

18.2%

$11

($20)

$6 ($10)

($8)

$6 $231

$208

1Q-25

Mix

Price

Tariffs

Volume*

Material/

Manufacturing Costs

SG&A/Other

Currency

1Q-26

EBITDA (adj.)

Logistics

EBITDA (adj.)

* Includes fixed manufacturing cost absorption impact on the sales volume.

Certain data contained in the bar graph above has been rounded for presentation purposes.

See appendix for reconciliations of adjusted EBITDA and adjusted EBITDA margin to their most directly comparable GAAP financial measures.

1Q 2026 Segment Performance

Engineered Bearings

Net Sales ($M) Adjusted EBITDA ($M)

Q1 Organic Sales by Market/Sector

Organic sales up 3.0% YOY

+6.0%

$761

$806

$159 $159

20.9%

19.7%

Aerospace

Auto/Truck

Distribution

General Industrial

Heavy Industries

Off-Highway

Rail

Renewable Energy

1Q-25 1Q-26 1Q-25 1Q-26

Certain data presented above has been rounded for presentation purposes. Sales from currency added 3.0% from the same period last year; no acquisition impact.

1Q 2026 Segment Performance

Industrial Motion

Net Sales ($M)

$425

+12.0%

$380

Adjusted EBITDA ($M)

21.5%

17.7%

$91

$67

Q1 Organic Sales by Platform

Belts & Chain

Couplings

Drive Systems & Services

Linear Motion

Lubrication Systems

Organic sales up 7.0% YOY

1Q-25 1Q-26 1Q-25 1Q-26

Certain data presented above has been rounded for presentation purposes. Sales from currency added 4.2% from the same period last year and acquisitions added 0.8%.

Cash Flow, Leverage & Capital Allocation

($M) 1Q-25 1Q-26

Capital Structure ($M)

12/31/25 03/31/26

Net Cash from Operations

$58.6

$39.3

Capital Expenditures

Free Cash Flow (FCF)

(35.2)

(38.8)

$23.4

$0.5

Cash

$ 364

$ 345

Total Debt Net Debt

Adj. EBITDA (TTM)

1,922

2,070

$1,558

$1,725

$ 796

$ 819

Net Debt/Adj. EBITDA

2.0x

2.1x

Repurchased 282K shares in 1Q-26 at an average price of ~$99 The Board recently approved a new share repurchase plan

10M shares authorized for repurchase through February 2031

Paid 415th consecutive quarterly dividend in 1Q-26 ($0.35/share)

Free cash flow is defined as net cash provided by operating activities minus capital expenditures.

See appendix for reconciliations of free cash flow, net debt, adjusted EBITDA and the ratio of net debt to adjusted EBITDA to their most directly comparable GAAP equivalents.

2026 Outlook

Current Outlook: Full-Year 2026 vs. 2025

Prior Outlook

February 4, 2026

May 6, 2026

Sales of +5% at midpoint (organic: +3%; FX: +1%; M&A: +1%) Adj. EBITDA margins of ~18% at midpoint (vs. 17.4% in 2025)

Net Sales

+2% to +4%

+4% to +6%

Adjusted EPS

Free Cash Flow

$5.50 to $6.00

$5.75 to $6.25

~$350M

$350M to $375M

Adj. EPS range of $5.75-$6.25, up 13% at midpoint (vs. $5.33 in 2025) Free cash flow outlook represents ~105% of GAAP net income at midpoint

See appendix for reconciliations of adjusted EPS, adjusted EBITDA margins and free cash flow to their most directly comparable GAAP financial measures.

Free cash flow is defined as net cash provided by operating activities minus capital expenditures.

FY-26 modeling assumptions:

Adj. tax rate: 26.5%

Interest expense: ~$100M

Noncontrolling interest: ~$28M

CapEx: ~3.4% of sales

Diluted shares: ~70M

Organic Growth Outlook - FY 2026 by Market/Sector

Market/Sector Placement Reflects Midpoint of Outlook

Negative

(down HSD+)

down MSD

Neutral

flat to +/- LSD

up MSD

Positive

up HSD+

Auto/Truck

Heavy Industries Rail

Renewable Energy

Aerospace & Defense Automation

General Industrial

Ind. Distribution Off-Highway Services

Expect organic sales of +3% in 2026 at midpoint (+2% in prior outlook)

Outlook implies range of +2% to +4%

Volumes and pricing up

Red = lower versus prior guide

LSD = low-single digit percentage change MSD = mid-single digit percentage change HSD = high-single digit percentage change

Note: Auto/Truck includes Auto OE, Heavy Truck OE and aftermarket; Aerospace & Defense includes military marine revenue See previous slide for reconciliation of organic revenue to its most directly comparable GAAP financial measure.

2026 Adj. EPS Outlook Bridge - Versus Prior Outlook (February)

Based on Midpoint of Outlook Ranges

~$0.20

~$0.15 (~$0.10) $6.00

$5.75

Prior 2026 Adj. EPS Outlook*

Organic (net)**

Tariffs

Cost inflation

New 2026 Adj. EPS Outlook*

Adj. EBITDA Margin*: high-17's%

Adj. EBITDA Margin*: ~18%

* Based on midpoint of outlook range

** Organic (net) reflects the incremental net impact of organic volume, including manufacturing cost absorption impact, and price/mix (pre-tariff pricing)

Note: "Tariffs" net impact reflects tariff rates currently in effect and is inclusive of the changes to Section 232 on April 6, 2026 See appendix for reconciliations of adjusted EPS to its most directly comparable GAAP financial measure.

Appendix:

GAAP Reconciliations

GAAP Reconciliation: Net Income & EPS

The following reconciliation is provided as additional relevant information about the Company's performance deemed useful to investors. Management believes that the non-GAAP measures of adjusted net income and adjusted diluted earnings per share are important financial measures used in the management of the business, including decisions concerning the allocation of resources and assessment of performance. Management believes that reporting adjusted net income and adjusted diluted earnings per share is useful to investors as these measures are representative of the Company's core operations.

2026

EPS

2025

EPS

Net Income Attributable to The Timken Company

$ 98.2

$ 1.40

$ 78.3

$ 1.11

Adjustments: (1)

Acquisition intangible amortization

$ 20.6

$ 19.0

Impairment, restructuring and reorganization charges (2)

4.9

3.2

Acquisition-related charges (3)

1.8

Gain on sale of certain assets (4)

(1.2)

CEO transition expenses (5)

8.6

Noncontrolling interest of above adjustments (6)

(0.1)

3.8

Provision for income taxes (7)

(8.1)

(13.1)

Total Adjustments:

19.1

0.27

20.3

0.29

Adjusted Net Income Attributable to The Timken Company

$ 117.3

$ 1.67

$ 98.6

$ 1.40

(1) Adjustments are pre-tax, with the net tax provision listed separately.

(2) Impairment, restructuring and reorganization charges (including items recorded in cost of products sold) relate to: (i) plant closures; (ii) the rationalization of certain plants; (iii) severance related to cost reduction initiatives; (iv) impairment of assets; and

(v) related depreciation and amortization. The Company re-assesses its operating footprint and cost structure periodically, and makes adjustments as needed that result in restructuring charges. However, management believes these actions are not representative of the Company's core operations.

(3) Acquisition-related charges represent deal-related expenses associated with completed transactions and any resulting inventory step-up impact.

(4) Represents the net gain resulting from the sale of certain assets.

(5) On March 31, 2025, the Company announced that Tarak B. Mehta, President and Chief Executive Officer ("CEO") of the Company would be departing from the Company, effective immediately, and Richard G. Kyle would be serving as interim President and CEO. CEO transition expenses primarily related to the cost of the settlement agreement with Mr. Mehta in connection with his departure, net of stock compensation expense for stock awards forfeited.

(6) Represents the noncontrolling interest impact of the adjustments listed above, as well as the reversal of uncertain tax positions related to Timken India Limited.

(7) Provision for income taxes includes the net tax impact on pre-tax adjustments (listed above), the impact of discrete tax items recorded during the respective periods as well as other adjustments to reflect the use of one overall effective tax rate on adjusted pre-tax income in interim periods.

GAAP Reconciliation: EBITDA and EBITDA, After Adjustments to GAAP Net Income

The following reconciliation is provided as additional relevant information about the Company's performance deemed useful to investors. Management believes consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP measure that is useful to investors as it is representative of the Company's performance and that it is appropriate to compare GAAP net income to consolidated EBITDA. Management also believes that adjusted EBITDA, adjusted EBITDA margin and EBITDA margin are useful to investors as they are representative of the Company's core operations and are used in the management of the business, including decisions concerning the allocation of resources and assessment of performance.

Percentage to

Net Sales

Net Income $ 105.9 8.6 % $ 91.4 8.0 %

Provision for income taxes 37.0 26.9

Interest expense 24.3 26.5

Interest income (1.7) (2.3)

Depreciation and amortization 58.9 55.1

Consolidated EBITDA $ 224.4 18.2 % $ 197.6 17.3 %

Adjustments:

Impairment, restructuring and reorganization charges (1) $ 4.8 $ 3.1

Acquisition-related charges (2) 1.8 -

Gain on sale of certain assets (3) - (1.2)

CEO transition expenses (4) - 8.6

Total Adjustments 6.6 0.6 % 10.5 0.9 %

Adjusted EBITDA $ 231.0 18.8 % $ 208.1 18.2 %

(1) Impairment, restructuring and reorganization charges (including items recorded in cost of products sold) relate to: (i) plant closures; (ii) the rationalization of certain plants; (iii) severance related to cost reduction initiatives; and (iv) impairment of assets. The Company re-assesses its operating footprint and cost structure periodically, and makes adjustments as needed that result in restructuring charges. However, management believes these actions are not representative of the Company's core operations.

(2) Acquisition-related charges represent deal-related expenses associated with completed transactions and any resulting inventory step-up impact.

(3) Represents the net gain resulting from the sale of certain assets.

(4) On March 31, 2025, the Company announced that Tarak B. Mehta, President and CEO of the Company would be departing from the Company, effective immediately, and Richard G. Kyle would be serving as interim President and CEO. CEO transition expenses primarily relate to the cost of the settlement agreement with Mr. Mehta in connection with his departure, net of stock compensation expense for stock awards forfeited.

GAAP Reconciliation: Net Debt & Free Cash Flow

These reconciliations are provided as additional relevant information about the Company's financial position deemed useful to investors. Capital, used for the ratio of net debt to capital, is a non-GAAP measure defined as total debt less cash and cash equivalents plus total shareholders' equity. Management believes Net Debt, the Ratio of Net Debt to Capital, Adjusted EBITDA (see next page of GAAP reconciliations), and the Ratio of Net Debt to Adjusted EBITDA are important measures of the Company's financial position, due to the amount of cash and cash equivalents on hand. The Company presents net debt to adjusted EBITDA because it believes it is more representative of the Company's financial position as it is reflective of the ability to cover its net debt obligations with results from its core operations.

December 31,

2025

Short-term debt, including current portion of long-term debt $ 42.9 $ 38.9

Long-term debt 2,027.2 1,883.1

Total Debt $ 2,070.1 $ 1,922.0

Less: Cash and cash equivalents (344.7) (364.4)

Net Debt $ 1,725.4 $ 1,557.6

Total Equity $ 3,367.9 $ 3,345.7

Ratio of Net Debt to Capital 33.9 % 31.8 %

Adjusted EBITDA for the Twelve Months Ended $ 818.7 $ 795.8

Ratio of Net Debt to Adjusted EBITDA 2.1 2.0

Management believes that free cash flow is a non-GAAP measure that is useful to investors because it is a meaningful indicator of cash generated from operating activities available for the execution of its business strategy.

2026

2025

Net cash provided by operating activities

$ 39.3

$ 58.6

Less: capital expenditures

(38.8)

(35.2)

Free cash flow

$ 0.5

$ 23.4

GAAP Reconciliation: Consolidated EBITDA

The following reconciliation is provided as additional relevant information about the Company's performance deemed useful to investors. Management believes consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP measure that is useful to investors as it is representative of the Company's performance and that it is appropriate to compare GAAP net income to consolidated EBITDA. Management also believes that the non-GAAP measure of adjusted EBITDA is useful to investors as it is representative of the Company's core operations and is used in the management of the business, including decisions concerning the allocation of resources and assessment of performance.

(Dollars in millions)

Twelve Months End

March 31, 2026

Twelve Months Ended

December 31, 2025

Net Income

331.8

317.3

Provision for income taxes

108.8

98.7

Interest expense

108.1

110.3

Interest income

(9.7)

(10.3)

Depreciation and amortization

233.9

230.1

Consolidated EBITDA

772.9

746.1

Adjustments:

Impairment, restructuring and reorganization charges (1)

22.4

20.7

Corporate pension and other postretirement benefit related expense (2)

10.8

Acquisition-related charges (3)

1.8

Gain on sale of certain assets (4)

(1.4)

(2.6)

CEO transition expenses (5)

12.2

20.8

Total Adjustments

45.8

49.7

Adjusted EBITDA

818.7

795.8

(2) Corporate pension and other postretirement benefit related expense represents actuarial losses that resulted from the remeasurement of plan assets and obligations as a result of changes in assumptions or experience. The Company recognizes actuarial losses and gains in connection with the annual remeasurement in the fourth quarter, or if specific events trigger a remeasurement.

(3) Acquisition-related charges represent deal-related expenses associated with completed transactions and any resulting inventory step-up impact.

(4) Represents the net gain resulting from sale of certain assets.

(5) On August 22, 2025, the Company announced the appointment of Lucian Boldea as President and CEO, effective September 1, 2025, and that Richard G. Kyle would retire from the role of interim President and CEO. On March 31, 2025, the Company announced that Tarak B. Mehta, President and CEO of the Company would be departing from the Company, effective immediately, and Mr. Kyle would be serving as interim President and CEO. CEO transition expenses for the twelve months ended December 31, 2025, primarily relate to the cost of the settlement agreement with Mr. Mehta in connection with his departure, net of the impact for stock awards forfeited, the acceleration of certain stock compensation awards issued to Mr. Kyle, and other one-time costs associated with the transition in 2025.

GAAP Reconciliation: Adjusted EPS and Free Cash Flow Outlook

The following reconciliation is provided as additional relevant information about the Company's outlook deemed useful to investors. Forecasted full year adjusted diluted earnings per share is an important financial measure that management believes is useful to investors as it is representative of the Company's expectation for the performance of its core business operations.

Forecasted full year GAAP diluted earnings per share $ 4.70 $ 5.20

Forecasted Adjustments:

Impairment, restructuring and other special items, net (1) 0.20 0.20

Acquisition-related intangible amortization expense, net 0.85 0.85

Forecasted full year adjusted diluted earnings per share $ 5.75 $ 6.25

(1) Impairment, restructuring and other special items, net do not include the impact of any potential future mark-to-market pension and other postretirement remeasurement adjustments, because the amounts will not be known until incurred.

Forecasted full year free cash flow is a non-GAAP measure that is useful to investors because it is representative of the Company's expectation of cash that will be generated from operating activities and available

for the execution of its business strategy.

Net cash provided from operating activities

515.0

540.0

Less: capital expenditures

165.0

Free cash flow

350.0

375.0

GAAP Reconciliation: Net Sales to Organic Sales

The following reconciliation is provided as additional relevant information about the Company's performance deemed useful to investors. Management believes that net sales, excluding the impact of acquisitions and foreign currency exchange rate changes, allow investors and the Company to meaningfully evaluate the percentage change in net sales on a comparable basis from period to period.

Three Months Ended March 31, 2025

$ Change % Change

Net sales

1,231.3

1,140.3

91.0

8.0 %

Less: Acquisitions

3.1

Currency

38.6

Net sales, excluding the impact of acquisitions and currency

1,189.6

1,140.3

49.3

4.3 %

Engineered Bearings

Three Months Ended March 31, 2025

$ Change % Change

Net sales

806.2

760.7

45.5

6.0 %

Less: Currency

22.9

Net sales, excluding the impact of currency

783.3

760.7

22.6

3.0 %

Industrial Motion

Three Months Ended March 31, 2025

$ Change % Change

Net sales

425.1

379.6

45.5

12.0 %

Less: Acquisitions

3.1

Currency

15.7

Net sales, excluding the impact of acquisitions and currency

406.3

379.6

26.7

7.0 %

Disclaimer

The Timken Co. published this content on May 06, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 06, 2026 at 11:07 UTC.