Fortive Corp Q2 2023 Earnings Conference Call July 26, 2023 12:00 PM ET Company Participants Elena Rosman - VP, IR Jim Lico - President & CEO Charles McLaughlin - SVP & CFO Conference Call Participants Jeff Sprague - Vertical Research Steve Tusa - JPMorgan Scott Davis - Melius Research Deane Dray - RBC Capital Markets Andrew Obin - Bank of America Josh Pokrzywinski - Morgan Stanley Julian Mitchell - Barclays Andy Kaplowitz - Citi Nigel Coe - Wolfe Research Joe Giordano - TD Cowen Joe O'Dea - Wells Fargo Bre ...

Raised FY AOP margin outlook driven by FBS-enabled innovation, pricing tools and productivity initiatives benefiting all segments Connected Reliability VVV G@RDIAN® | --- | --- | --- | --- | --- | --- | |--------------------------------------------------------------------|-------------------|--------------------|-------|------------|--------------------------------------------------------------------------------------------------------------------------------| | | | | | | | | | 8% to 11% | 9% to 12% | | 10% ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________________________________________________ FORM 10-Q ________________________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: June 30, 2023 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-37654 __________________________ ...

Fortive Corp (NYSE:FTV) Q1 2023 Earnings Conference Call April 26, 2023 12:00 PM ET Company Participants Elena Rosman - VP, IR James Lico - President, CEO & Director Charles McLaughlin - SVP & CFO Conference Call Participants Julian Mitchell - Barclays Bank Jeffrey Sprague - Vertical Research Partners Charles Tusa - JPMorgan Chase & Co. Scott Davis - Melius Research Andrew Obin - Bank of America Merrill Lynch Andrew Kaplowitz - Citigroup Deane Dray - RBC Capital Markets Nigel Coe - Wolfe Research Joseph Gio ...

| --- | --- | --- | |--------------------------------------|-------|-------| | | | | | First Quarter 2023 Earnings Release | | | All financial metrics relate only to the continuing operations, and all growth or period changes refer to year-over-year comparisons unless otherwise stated. Please refer to the corresponding Form 10-Q for the quarter ended March 31, 2023 for additional details relating to the financial results and performances discussed in this presentation. $1,461M 58.4% $0.75 Q1 2023 FINANCIALS ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________________________________________________ FORM 10-Q ________________________________________________ (Mark One) Fortive Corporation (Exact name of registrant as specified in its charter) ________________________________________________ Delaware 47-5654583 ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: March 31, 2023 Or ☐ TRANSITION REPORT PURSUANT TO SECTI ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________________________________________________ FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 1-37654 ____________ FORTIVE CORPORATION (Exact name of registrant as specified in its c ...

FORWARD LOOKING STATEMENTS & NON-GAAP FINANCIAL | --- | --- | |-------------------------------------------------------------------------------------------|-------| | | | | Barclays Industrial Select Conference FEBRUARY 22 ND , 2023 | | | Jim Lico, President & CEO, Fortive Chuck McLaughlin, Senior Vice President & CFO, Fortive | | MEASURES This presentation may contain references to financial measures not presented in accordance with generally accepted accounting principles ("GAAP"). We have not reconciled f ...

Financial Data and Key Metrics Changes - Fortive reported a 14% core revenue growth in Q4 2022, with adjusted gross and operating margins expanding by 50 and 110 basis points respectively [4][34] - Adjusted earnings per share grew by 11% to $0.88, while free cash flow increased by 62% to $428 million in the quarter, totaling $1.2 billion for the year [4][35][62] - The company achieved approximately 21% free cash flow margin, underscoring its ability to generate cash flow from a higher base [21][62] Business Line Data and Key Metrics Changes - Intelligent Operating Solutions (IOS) experienced a 13% core revenue growth, with double-digit growth across all regions [37] - Precision Technologies (PT) saw a 20% increase in core revenues, driven by high teens growth in North America and over 20% growth in Western Europe and China [10] - Advanced Healthcare Solutions (AHS) revenues increased by 5%, with mid-single-digit growth in North America but declines in Western Europe and China [11][12] Market Data and Key Metrics Changes - North America revenue grew low double-digits, while Western Europe saw mid-teens growth, driven by hardware products and favorable pricing [33] - Asia revenue increased high-teens, with low 20% growth in China, despite a significant drop in elective procedures impacting AHS [49] - The company reported strong demand in EMEA, with SaaS revenue growth in the region reaching double digits [8] Company Strategy and Development Direction - Fortive's strategy focuses on continuous improvement through the Fortive Business System, which has contributed to record gross margins and free cash flow generation [5][13] - The company is transitioning to a more recurring revenue model, with approximately 40% of sales expected to come from recurring SaaS revenue [51][118] - Fortive plans to leverage its strong backlog and pricing actions to drive growth and margin expansion in 2023 [36][51] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing supply chain and inflationary challenges but expressed confidence in the company's ability to navigate these issues [5][19] - The outlook for 2023 includes core revenue growth guidance of 3% to 5.5%, with expectations for margin expansion across strategic segments [54][62] - Management highlighted the importance of productivity initiatives and pricing actions to counteract macroeconomic headwinds [51][134] Other Important Information - Fortive achieved approximately 1,000 basis points of gross margin expansion since 2016, translating into higher operating margins [21] - The company is committed to sustainability, having set ambitious goals for greenhouse gas emissions reduction by 2029 [31][47] - Fortive's diverse leadership team and commitment to inclusion and diversity are seen as critical components of its corporate culture [30] Q&A Session Summary Question: Can you discuss the margin expansion for IOS? - Management indicated that margin expansion will be driven by productivity initiatives and normal revenue growth [88] Question: What is the expected pace of backlog conversion? - Management expects to work through about half of the excess backlog in 2023, depending on order rates and supply chain improvements [90][116] Question: How do you see the orders and revenue guidance for Tektronix? - Management noted that orders are expected to slow but emphasized that backlog will help mitigate the impact on revenue [99][100] Question: What is the outlook for discretionary procedures in China? - Management reported that January volumes were around 50% of prior year levels, with expectations for gradual improvement throughout the year [107] Question: What is the company's approach to potential acquisitions? - Management stated that they are open to strategic acquisitions but will maintain an investment-grade rating and be disciplined in their approach [111][134]

Financial Performance Highlights - Q4 2022 revenue reached $1,530 million[5], while full-year revenue amounted to $5,826 million[5] - Fortive achieved a 62% growth in free cash flow in Q4 and 28% for the full year 2022[6] - The company's adjusted earnings per share were $0.88 in Q4 and $3.15 for the full year[5] - Fortive delivered 14% core revenue growth in Q4 and 10% in FY22[100] Revenue Growth Components - Total revenue growth for Q4 2022 was 11.3% and 10.9% for the full year[82] - Acquisitions contributed 1.4% to revenue growth in Q4 and 3.9% for the full year[83] - Currency translation had a negative impact of approximately 4% in Q4[30] Segment Performance - Intelligent Operating Solutions (IOS) saw core revenue growth of 13.1% in Q4 and 12.0% for the full year[85] - Precision Technologies (PT) experienced core revenue growth of 20.4% in Q4 and 13.2% for the full year[63] - Advanced Healthcare Solutions (AHS) reported core revenue growth of 5.3% in Q4 and 2.1% for the full year[65] Margin and Profitability - The company's adjusted gross margin increased by 50 bps[15] - Adjusted operating profit margin increased by 110 bps in Q4[12] - Fortive anticipates a 75 bps increase in adjusted operating profit margin for FY 2023[24] 2023 Outlook - Fortive projects core growth of 3% to 5% for FY 2023[23] - The company estimates revenue between $5,950 million and $6,100 million for FY 2023[24] - Adjusted EPS is projected to be between $3.25 and $3.40 for FY 2023[24]