4q earnings presentation
TRANSCRIPT
February 2, 2012
4th Quarter 2011
During the course of this presentation, we may make projections or otherforward-looking statements within the meaning of the Private SecuritiesLitigation Reform Act of 1995.
We wish to caution you that such statements reflect only our currentexpectations, and that actual events or results may differ materially dueto changes in global economic, business, competitive, market andregulatory factors.
More detailed information about these factors is contained in thedocuments that the Company files from time to time with the Securitiesand Exchange Commission. We undertake no obligation to update suchprojections or such forward-looking statements in the future.
2
Forward Looking Statements
Net sales up 26% Organic sales up 13% Continued solid growth at Brake &
Friction, Construction Materials and Interconnect Technologies
$81M, or 13%, in sales from Hawk, PDT & Tri-Star acquisitions
EBIT Margin of 6.7% Selling Price / Raw Material parity at
CCM Positive impact on EBIT margin from
Hawk acquisition Charges for Acquisitions of $4.2M in
Q4 ‘11 versus $14.2M in Q4 ‘10 for Hawk
Acquired Tri-Star on December 2, 2011
Highlights of Q4 2011
3
Financial Summary
Strong sales and earnings improvement
In Millions, except per share amounts Q4 '11 Q4 '10 ∆
Net Sales 789.6$ 626.9$ 26%
Earnings Before Interest and Income Taxes (EBIT) 52.7 26.8 97%
EBIT Margin 6.7% 4.3% 240 bps
Income from Continuing Operations, Net of Tax 39.5 21.9 80%
Continuing Operations Diluted Earnings per Share 0.63$ 0.35$ 80%
$626.9
$789.6
300
400
500
600
700
800
900
1,000
Q4 '10 Price Volume / Oth Acq F/X Q4 '11
$ in M
illions
Sales Bridge
4
26% Sales Growth: 13% Organic, 13% Acquisition
Organic +13.1%
+12.9% 0%
+6.8% +6.3%
Organic by SegmentConstruction 18%Transportation 5%Brake & Friction 15%Interconnect 20%FoodService -5%
Margin Bridge
5
Positive impact from acquisitions, volume and COSOperating improvements at CTP
EBIT: $26.8 Million EBIT: $52.7 Million97% growth
* Difference in acquisition related costs, 2011 v. 2010
4.3%
6.7%
1.3%
1.2%
0.6% 0.4%
0.1%
‐1.2%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%Q4 '10 Net Charges * Acq Volume COS Other Net Price / RM Q4 '11
EBIT
Mar
gin
Carlisle Construction MaterialsQ4 2011 Results
Sales growth of 23% PDT sales $16M, 5% Organic growth of 18% on strong
reroofing demand and selling price Selling price added 7%
EBIT increased 32% from $34.4M in 2010 to $45.5M in 2011 $2.1M expense for inventory step-
up at PDT under purchase accounting
Selling price offset raw material impact
Strong organic growth from reroofing demand and selling priceIntegration of PDT well underway
$306.5
$378.5
11.2%12.0%
$0
$50
$100
$150
$200
$250
$300
$350
$400
Q4 '10 Q4 '11
$ in
Mill
ions
Sales PDT Margin
23%
6
Carlisle Transportation ProductsQ4 2011 Results
7
Jackson plant issues addressedCTP positioned for margin improvement in 2012
Sales growth of 5% Selling price increase of $16M, 11% Partially offset by lower volume in Outdoor
Power Equipment and Transmission Belts
Raw Materials declining in Q4, however, year over year comparisons not favorable Natural Rubber up 21% in Q4 ‘11 vs. ‘10 Synthetic Rubber up 42% in Q4 ‘11 vs. ‘10 Higher priced inventory sold during period
negatively impacted earnings
EBIT loss of $4M Loss from lower volume and raw material Jackson plant running at target efficiency
levels
$146.4
$154.1
0.2%
-2.5%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
Q4 '10 Q4 '11$
in M
illio
nsSales Margin
5%
0%
Carlisle Brake & FrictionQ4 2011 Results
8
Sales growth of 126% Hawk contributed $56.8M, 111%,
reflects first two months of Q4 (Hawk acquired December 1, 2010)
Organic sales growth of 15% Continued global demand in
Agriculture, Construction and Mining EBIT of $15.4M in 2011 versus loss of
$10.7M in 2010 Hawk contributed $11.4M in Q4 ‘11 Acquisition charges of $14.2M in Q4
2010 for Hawk
Integration of Hawk in 2011 tremendous success
$51.4
$116.2
-20.8%
13.3%
$0
$20
$40
$60
$80
$100
$120
$140
Q4 '10 Q4 '11
$ in
Mill
ions
Sales Hawk Margin
126%
0%
Carlisle Interconnect TechnologiesQ4 2011 Results
9
Tri-Star Electronics acquired Dec. 2, 2011 for $284M Leading supplier of electrical contacts
to aerospace, defense and industrial customers
CIT sales growth of 32% Tri-Star added $7.8M, 12% Organic sales growth of 20% driven
by strong aerospace sales
EBIT increased 17% from $8.9M in 2010 to $10.4M in 2011
Excluding $2.1M in acquisition related costs, EBIT in Q4 ‘11 was $12.5M, margin of 14.5% 1
Outstanding sales and EBIT performance
$65.5
$86.5
13.6%
12.0%
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
Q4 '10 Q4 '11$
in M
illio
nsSales Tri-Star Margin
32%
1 Refer to slide 20 for reconciliation of GAAP to non-GAAP measure
Carlisle FoodService ProductsQ4 2011 Results
10
Sales declined 5%
Selling price increase of 2% partially offset volume decline
Demand down in foodservice products and healthcare
EBIT loss of $2.1M in Q4 ‘11
Negatively impacted by lower sales volume, unfavorable mix changes, higher customer rebates
$1.6M severance charges
Undergoing actions to address performance and improvement plan for 2012
$57.1
$54.3
9.3%
-3.9%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
$0
$10
$20
$30
$40
$50
$60
$70
Q4 '10 Q4 '11
$ in
Mill
ions
Sales Margin
-5%
0%
Net sales up 28% Organic up 14% Acquisitions contributed 13% FX < 1% impact
EBIT Margin 8.5%, up 70 bps from prior year
Effective tax rate 28.4% in 2011 v. 30.5% in 2010
EPS up 37% to $2.88
2011 Highlights
11
Financial Summary
Segment Summary
In Millions, except per share amounts 2011 2010 ∆
Net Sales 3,224.5$ 2,527.7$ 28%
Earnings Before Interest and Income Taxes (EBIT) 275.1 196.1 40%
EBIT Margin 8.5% 7.8% 70 bps
Income from Continuing Operations, Net of Tax 181.9 130.6 39%
Continuing Operations Diluted Earnings per Share 2.88$ 2.10$ 37%
In Millions Const. Trans.Brake & Friction
Inter-connect
Food-Service Corp Total
2011Net Sales 1,484.0$ 732.1$ 473.0$ 299.6$ 235.8$ -$ 3,224.5$ EBIT 177.9 9.1 77.2 41.9 13.2 (44.2) 275.1 EBIT Margin 12.0% 1.2% 16.3% 14.0% 5.6% -1.4% 8.5%
2010Net Sales 1,223.6$ 684.8$ 129.4$ 251.1$ 238.8$ -$ 2,527.7$ EBIT 159.2 21.7 (0.9) 30.9 24.3 (39.1) 196.1 EBIT Margin 13.0% 3.2% -0.7% 12.3% 10.2% -1.5% 7.8%
YOY ChangeNet Sales 21% 7% 266% 19% -1% 28%EBIT 12% -58% NM 36% -46% -13% 40%
$2,527.7
$3,224.5
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2010 Price Volume / Oth Acq F/X 2011
$ in M
illions
Sales Bridge Full Year 2011
12
28% Sales Growth: 14% Organic, 13% Acquisition, FX < 1%
Organic +13.9%
+13.4%
0.3%
+4.9% +9.0%
Organic by SegmentConstruction 19%Transportation 6%Brake & Friction 30%Interconnect 16%FoodService -2%
Margin Bridge Full Year 2011
13
Positive impact from acquisitions, volume and COSPartially offset by raw materials and Jackson start-up at CTP
EBIT: $196.1 Million EBIT: $275.1 Million40% growth
* Difference in acquisition related costs, 2011 v. 2010
7.8%8.5%0.2%
1.2% 0.9%
0.7%‐1.5%
‐0.8%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%2010 Net Charges * Acq Volume COS Net Price / RM Other Op 2011
EBIT
Mar
gin
14
Strong Balance SheetDebt Maturity Schedule
In millions Cash on Hand of $75M
Tri-Star acquisition for $284M, net of cash acquired, funded by credit facility
$252M available as of 12/31/11 under new revolver
Debt to Cap ratio of 34%
Debt to EBITDA of 2.0
Cash proceeds of $23M for Profiles sale on 1/2/12
Well-positioned for further investment in acquisitions, new product development and capital expenditures
Drawn $348
$252
$0
$100
$200
$300
$400
$500
$600
2012 2016 2018 2020
Available Under $600M Revolver at 12/31/11
IRB & OtherSenior Notes $149M
Senior Notes $249M
15
Cash Flow
78% Op Cash Flow Increase – 161% Free Cash Flow Increase
($40)
($20)
$0
$20
$40
$60
$80
$100
$120
Q4 '10 Q1 '11 Q2 '11 Q3 '11 Q4 '11
$ in M
illions
Operating Cash Flow Capital Expenditures Free Cash Flow
Q4 '10 Q1 '11 Q2 '11 Q3 '11 Q4 '11Operating Cash Flow $45.0 ($0.3) $14.0 $105.2 72.3 Capital Expenditures (17.8) (16.9) (16.9) (14.7) (31.1)Free Cash Flow 27.2 (17.2) (2.9) 90.5 41.2
Cash Flow by QuarterSummary
In Millions 2011 2010
Net income 180.3$ 145.6$ Depreciation and amortization 88.0 71.9 Non-cash compensation 15.7 13.3 Change in working capital (91.6) (109.9) Other (1.2) (13.5)
Operating Cash Flow 191.2$ 107.4$
Capital expenditures (79.6) (64.6)
Free Cash Flow 111.6$ 42.8$
16
Working Capital as a % of Net Sales
Working Capital reflects average of quarter ending Receivables plus Inventory less Accounts Payable. % of Net Sales calculated using average Working Capital over annualized year-to-date Net Sales.
Managing working capital on higher sales volume
Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10 Q2 '10 Q3 '10 Q4 '10 Q1 '11 Q2 '11 Q3 '11 Q4 '11WC as a % of Net Sales 30.4% 26.5% 25.1% 24.9% 23.5% 21.4% 21.6% 22.0% 23.4% 21.7% 21.5% 21.9%
20.0%
22.0%
24.0%
26.0%
28.0%
30.0%
32.0%
17
Q & A
Carlisle 2012 Outlook
18
Total sales growth with Tri-Star and PDT ~ 10%
Organic sales growth in mid-single digits
Margin improvement from organic growth, CTP improvements, COS and Tri-Star acquisition
Corporate Expense - $44M
Depreciation & Amortization - $107M
Interest Expense - $24M
Tax Rate - 33%
Cash conversion ~ 75% on higher Capital Expenditures (Ratio of Free Cash Flow before Dividends to Net Income)
Capital Expenditures - $120M - $150M
Higher investment opportunities identified at CCM, CBF and CIT
19
Appendix
Reconciliation –GAAP to Non‐GAAP Measures
20
In Millions
Page 9 Q4 '11
EBIT - Carlisle Interconnect Technologies $10.4Addback: Non-recurring pre-tax acquistion costs 2.1Adjusted EBIT - Carlisle Interconnect Technologies 12.5
Net Sales - Carlisle Interconnect Technologies $86.5
Adjusted EBIT Margin 14.5%