PH
Parker Hannifin Corporation
Raymond James 46th Annual Institutional Investors Conference
Todd Leombruno
Chief Financial Officer
March 3, 2025
Parker Hannifin at-a-Glance
Engineering Customer Success in Motion & Control Industry for over 100 years
~$20B FY25G Revenue
Diversified
Aerospace
Industrial
Systems
International
31%
28%
Businesses
DiversifiedIndustrial
NorthIndustrialAmerica
North America
41%
41%
Motion Systems
Aerospace
Motion
Systems
16%
Systems
31%
16%
Technology
Platforms
Flow & Process
Filtration &
Control
Engineered
23%
Materials
30%
▪
The Win StrategyTM ▪
A technology powerhouse of
▪
Interconnected solutions
Global distribution network ▪
Decentralized operating structure
3
#1 Position in Motion & Control Industry
>90% of Sales Comes from 6 Market Verticals
~$145B Market Size
Other 5%
HVAC/R 4%
Energy 8%
Aerospace &
▪ Interconnected technologies and solutions
across market verticals
Defense 33%
~$20B
▪ 2/3's of our revenue comes from customers
Off Highway 15%
who buy 4 or more technologies
Sales
▪ Growth focused on faster growing, longer
cycle markets and secular trends
Transportation 15%
In-plant & Industrial
Equipment 20%
Note: Sales and market sizes as of FY24. Aerospace & Defense market includes sales reported both in the Aerospace Systems seg ment and Diversified Industrial segment.
4
Why We Win
Strong Competitive Advantages
Parker's
Innovative
Application
Interconnected
Distribution
Business System
Products
Engineering
Technologies
Network
Decentralized structure,
Deep customer
Technical expertise
Enables
Serving global
strategic positioning &
partnership to
creates competitive
comprehensive
aftermarket & small
operational excellence
uncover unmet needs
advantage
solutions for customers
to mid-sized OEMs
5
Our People, Strategy & Portfolio Drive Performance
A More Resilient Transformed Parker
Revenue
Adjusted Operating
Adjusted EPS1
Free Cash Flow1
Margin1
~$26.70
~$3.2B
~$19.8B
~25.8%
$15.9B
$18.72
$2.2B
22.3%
FY22
FY25G
FY22
FY25G
FY22
FY25G
FY22
FY25G
+8%
+350 bps
+13%
+13%
Revenue
Adjusted Operating
Adjusted EPS1
Free Cash Flow1
CAGR
Margin1 Expansion
CAGR
CAGR
1. Adjusted numbers include certain non-GAAP adjustments and financial measures. See Appendix for additional details and reconciliations.
Note: FY22 As reported: Operating Margin of 20.1%, EPS of $10.09, Cash Flow from Operations: $2.4B. FY25G As reported: Operating Margin of 22.7%, EPS of $24.76, Cash Flow from Operations: $3.6B.
6
FY29 Targets
Increased Margin & Cash Flow Targets
Organic
Adjusted
Adjusted
Free Cash
Adjusted EPS
Growth CAGR
Operating Margin
EBITDA Margin
Flow Margin
Growth CAGR
4-6% 27% 28%
17% 10%+
+200bps
+300bps
+100bps
From previous target
From previous target
From previous target
7
Reconciliation of FY22 Financials
RECONCILIATION OF OPERATING INCOME TO ADJUSTED OPERATING INCOME
RECONCILIATION OF CASH FLOW FROM OPERATIONS TO FREE CASH FLOW
RECONCILIATION OF EPS TO ADJUSTED EPS
3
*Amounts have been adjusted to reflect the change in inventory accounting method. **Totals may not foot due to rounding
9
Reconciliation of FY25 Guidance
RECONCILIATION OF ORGANIC GROWTH
(Unaudited)
Fiscal Year 2025
(Amounts in percentages)
Forecasted Net
Adjusted Forecasted
Sales
Currency
Divestitures
Net Sales
Diversified Industrial
North America Businesses
(8.0%) to (5.0%)
~0.5%
~3.5%
(4.0%) to (1.0%)
International Businesses
(4.0%) to (1.0%)
~2.5%
-
(1.5%) to 1.5%
Aerospace Systems
9.5% to 12.5%
~0.0%
-
9.5% to 12.5%
Parker
(2.0%) to 1.0%
~1.0%
~1.5%
0.5% to 3.5%
RECONCILIATION OF OPERATING INCOME TO ADJUSTED OPERATING INCOME
(Unaudited)
Fiscal Year 2025
(Amounts in percentages)
Forecasted
Business
Acquisition-Related
Adjusted Forecasted
Segment Operating
Realignment
Costs to
Intangible Asset
Segment Operating
Margin
Charges
Achieve
Amortization Expense
Margin
Diversified Industrial
North America Businesses
~23.2%
~0.2%
-
~2.0%
~25.4%
International Businesses
~21.9%
~0.6%
-
~1.6%
~24.1%
Aerospace Systems
~22.8%
-
~0.3%
~4.9%
~28.0%
Parker
~22.7%
~0.2%
~0.1%
~2.8%
~25.8%
RECONCILIATION OF FORECASTED EARNINGS PER SHARE
(Unaudited)
(Amounts in dollars)
Fiscal Year 2025
Forecasted earnings per diluted share
$24.46 to $25.06
Adjustments:
Business realignment charges
0.39
Costs to achieve
0.15
Acquisition-related intangible asset amortization expense
4.22
Net gain on divestitures
(1.91)
Gain on sale of building
(0.08)
Tax effect of adjustments
1
(0.83)
Adjusted forecasted earnings per diluted share
$26.40 to $27.00
RECONCILIATION OF CASH FLOW FROM OPERATIONS TO FREE CASH FLOW
(Unaudited)
(Dollars in millions)
Fiscal Year 2025
Cash flow from operations
$3,400 to $3,700
Less: Capital Expenditures
~(400)
Free cash flow
$3,000 to $3,300
1. This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre -tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.
*Totals may not foot due to rounding
10
Disclaimer
Parker Hannifin Corporation published this content on March 03, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on March 03, 2025 at 22:27:41.645.