ENPRO Investor Presentation March 2022 Forward-Looking Statements Statements in this presentation that express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements under the Private Securities Litigation Reform Act of 1995. They involve a number of risks and uncertainties that may cause actual events and results to differ materially from such forward-looking statements. These risks and uncertainties include, but are not limited to: impacts from th ...

PART I [ITEM 1. BUSINESS](index=5&type=section&id=Item%201%20Business) EnPro Industries is an engineered industrial products company shifting its portfolio towards high-growth materials science businesses - EnPro is focused on materials science-based businesses with leading technologies, compelling margins, strong cash flow, and high levels of recurring revenue, particularly in semiconductor, life sciences, and other technology industries[16](index=16&type=chunk)[132](index=132&type=chunk) - The company completed several strategic acquisitions, including **NxEdge** (semiconductor industry, **$856.8 million**) in December 2021 and **Alluxa** (optical filters, thin-film coatings, **$238.4 million**) in October 2020, both integrated into the Advanced Surface Technologies segment[18](index=18&type=chunk)[19](index=19&type=chunk)[20](index=20&type=chunk)[22](index=22&type=chunk) - Significant divestitures in 2021 included the Compressor Products International (CPI) business, resulting in a **pre-tax gain of $117.6 million**, and a polymer components business unit, yielding a **pre-tax gain of $19.5 million**[26](index=26&type=chunk)[27](index=27&type=chunk) - As of December 31, 2021, EnPro had approximately **4,400 employees** globally, with **58% in North America**, and has seen an **11% increase in female promotions** in the U.S. since January 2019[62](index=62&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk) **Sales from Continuing Operations by Geographic Region (in millions)** | Geographic Region | 2021 | 2020 | 2019 | | :---------------- | :--- | :--- | :--- | | United States | $533.5 | $555.7 | $630.2 | | Europe | $265.8 | $244.2 | $301.2 | | Other | $342.5 | $274.1 | $274.3 | | **Total** | **$1,141.8** | **$1,074.0** | **$1,205.7** | **Backlog of Orders from Continuing Operations (in millions)** | Date | Backlog Value | | :------------- | :------------ | | Dec 31, 2021 | $365.8 | | Dec 31, 2020 | $212.5 | [ITEM 1A. RISK FACTORS](index=14&type=section&id=Item%201A%20Risk%20Factors) The company faces material risks from COVID-19, market competition, supply chain costs, M&A activities, and international operations - COVID-19 continues to pose risks, potentially affecting demand, supply chains, and global operations, with uncertainty regarding its duration and economic repercussions[71](index=71&type=chunk)[72](index=72&type=chunk)[73](index=73&type=chunk) - The company operates in cyclical markets (e.g., semiconductor, chemical, heavy-duty trucking) and faces intense competition, requiring continuous investment in manufacturing, marketing, and new product development[74](index=74&type=chunk)[75](index=75&type=chunk) - Increased costs for raw materials and supply chain disruptions have impacted the business and may continue to do so, with no assurance that higher costs can be fully passed on to customers[77](index=77&type=chunk) - Failure to protect intellectual property rights, maintain or renew licenses, or manage risks associated with government contracts and product liability claims could materially adversely affect the business[78](index=78&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk)[82](index=82&type=chunk) - International operations, which accounted for approximately **53% of 2021 revenues**, expose the company to foreign currency fluctuations, adverse changes in foreign tax/regulatory requirements, political instability, and trade protection measures[94](index=94&type=chunk) - The company's debt agreements impose limitations on operations, such as restricted payments and incurrence of indebtedness, which could impede its ability to respond to market conditions or pursue opportunities[99](index=99&type=chunk) [ITEM 1B. UNRESOLVED STAFF COMMENTS](index=22&type=section&id=Item%201B%20Unresolved%20Staff%20Comments) The company has no unresolved staff comments from the SEC [ITEM 2. PROPERTIES](index=22&type=section&id=Item%202%20Properties) EnPro operates 19 primary facilities across 7 countries and believes its properties are well-maintained for current and future operations - EnPro operates **19 primary manufacturing and service facilities** in 7 countries, including the U.S., with its headquarters in Charlotte, North Carolina[16](index=16&type=chunk)[106](index=106&type=chunk) **Principal Facilities Overview** | Location | Segment | Owned/Leased | Size (Square Feet) | | :----------------------- | :------------------------ | :----------- | :----------------- | | Palmyra, New York (U.S.) | Sealing Technologies | Owned | 690,000 | | Longview, Texas (U.S.) | Sealing Technologies | Owned | 219,000 | | Thorofare, New Jersey (U.S.) | Engineered Materials | Owned | 171,000 | | Morgan Hill, California (U.S.) | Advanced Surface Technologies | Leased | 156,000 | | Annecy, France | Engineered Materials | Owned | 196,000 | | Suzhou, China | Engineered Materials | Owned | 152,000 | | Mexico City, Mexico | Sealing Technologies | Owned | 128,000 | | Heilbronn, Germany | Engineered Materials | Owned | 127,000 | | Sucany, Slovakia | Engineered Materials | Owned | 109,000 | | Saint Etienne, France | Sealing Technologies | Owned | 108,000 | | Neuss, Germany | Sealing Technologies | Leased | 97,000 | [ITEM 3. LEGAL PROCEEDINGS](index=23&type=section&id=Item%203%20Legal%20Proceedings) The company is involved in various legal matters but does not expect them to materially impact its financial condition - Descriptions of environmental and other legal matters are incorporated by reference from Item 7 and Note 19 of the Consolidated Financial Statements[108](index=108&type=chunk) - The company is involved in other litigation and legal proceedings arising in the ordinary course of business, but believes their outcome will not have a material adverse effect on its financial condition, results of operations, and cash flows[109](index=109&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=23&type=section&id=Item%204%20Mine%20Safety%20Disclosures) The company has no disclosures to report regarding mine safety [EXECUTIVE OFFICERS OF THE REGISTRANT](index=23&type=section&id=Executive%20Officers%20of%20the%20Registrant) This section lists the executive officers of EnPro Industries, Inc., their ages, positions, and professional backgrounds - Eric A. Vaillancourt was appointed President and CEO in November 2021, having previously led the Sealing Technologies segment and various divisions since joining EnPro in 2009[112](index=112&type=chunk) **Executive Officers of the Registrant** | Name | Age | Position | | :------------------- | :-- | :---------------------------------------------- | | Eric A. Vaillancourt | 58 | President, Chief Executive Officer and Director | | J. Milton Childress II | 64 | Executive Vice President and Chief Financial Officer | | Robert S. McLean | 57 | Executive Vice President, Chief Administrative Officer, General Counsel and Secretary | | Steven R. Bower | 63 | Senior Vice President, Controller and Chief Accounting Officer | | Ronald R. Angelillo | 51 | Vice President, Tax | PART II [ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES](index=26&type=section&id=Item%205%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Shareholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's stock trades on the NYSE, with details on share issuance and a new but unused share repurchase program - EnPro's common stock is traded on the New York Stock Exchange (NYSE) under the symbol 'NPO'[120](index=120&type=chunk) - As of December 31, 2021, there were **2,216 holders of record** of the company's common stock[120](index=120&type=chunk) - In December 2021, **112,903 shares** of common stock were issued to a NxEdge executive for **$9,999,931.61**, with a two-year transfer restriction, in reliance on a Section 4(a)(2) exemption from registration[121](index=121&type=chunk) - A **$50.0 million share repurchase program** authorized in October 2020 through October 2022 has not yet seen any repurchases[123](index=123&type=chunk) **Issuer Purchases of Equity Securities (Q4 2021)** | Period | Total Number of Shares Purchased | Average Price Paid per Share | | :-------------------------- | :------------------------------- | :--------------------------- | | October 1 – October 31, 2021 | — | — | | November 1 – November 30, 2021 | — | — | | December 1 – December 31, 2021 | 272 | $109.63 | | **Total** | **272** | **$109.63** | [ITEM 6. [RESERVED]](index=27&type=section&id=Item%206%20%5BReserved%5D) This item is reserved and contains no information [ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=28&type=section&id=Item%207%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses strong 2021 financial performance driven by demand growth, strategic shifts, and improved operational results - EnPro experienced strong demand growth and improved momentum across all businesses in 2021, primarily driven by the Sealing Technologies segment and portfolio reshaping[166](index=166&type=chunk) - Sales **increased by 6.3% in 2021 to $1,141.8 million** from $1,074.0 million in 2020, with Advanced Surface Technologies showing a **44.5% increase** and Engineered Materials a **10.0% increase**, while Sealing Technologies decreased by 5.8% due to divestitures[174](index=174&type=chunk) - Adjusted Segment EBITDA **increased by 22.5% to $257.9 million** in 2021 from $210.6 million in 2020, driven by increased sales volume, pricing, and manufacturing efficiencies, partially offset by higher costs[170](index=170&type=chunk) - Operating cash flows from continuing operations **significantly increased to $142.0 million** in 2021 from $57.6 million in 2020, primarily due to increased sales volume and reduced income tax payments[197](index=197&type=chunk) - The company entered into a Third Amended and Restated Credit Agreement in December 2021, providing **$1,007.5 million in credit facilities**, including a $400.0 million revolving credit facility and term loans, to fund acquisitions and general corporate purposes[201](index=201&type=chunk) - Critical accounting estimates include income taxes, environmental liabilities, and goodwill and other intangible assets[222](index=222&type=chunk)[224](index=224&type=chunk)[226](index=226&type=chunk)[228](index=228&type=chunk) **Financial Highlights (in millions, except per share data)** | Metric | 2021 | 2020 | 2019 | | :------------------------------------------------------------------ | :---------- | :---------- | :---------- | | Net sales | $1,141.8 | $1,074.0 | $1,205.7 | | Income (loss) from continuing operations attributable to EnPro | $177.2 | $(23.7) | $7.8 | | Net income attributable to EnPro | $177.2 | $184.4 | $38.3 | | Diluted earnings (loss) per share from continuing operations | $8.53 | $(1.15) | $0.38 | | Adjusted income from continuing operations attributable to EnPro | $115.3 | $83.9 | $81.1 | | Adjusted diluted earnings per share attributable to EnPro | $5.55 | $4.07 | $3.90 | | Adjusted Segment EBITDA | $257.9 | $210.6 | $208.6 | | Adjusted EBITDA | $208.4 | $168.3 | $169.4 | [ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=51&type=section&id=Item%207A%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages market risks from foreign currency and interest rates through operational activities and derivative instruments - EnPro is exposed to interest rate risk from its outstanding debt obligations, including **$350.4 million in fixed-rate debt** and **$781.6 million in variable-rate debt** as of December 31, 2021[255](index=255&type=chunk)[256](index=256&type=chunk) - Foreign currency risks are managed through operating activities and derivative financial instruments, with notional amounts of **$3.3 million in foreign exchange contracts** as of December 31, 2021[257](index=257&type=chunk) - Commodity price fluctuations for raw materials like steel, engineered plastics, copper, and polymers are mitigated by passing increases to customers and implementing lean initiatives[258](index=258&type=chunk) **Fixed Rate Debt Obligations (in millions)** | Year | 2022 | 2023 | 2024 | 2025 | 2026 | Thereafter | Total | Fair Value | | :--------- | :--- | :--- | :--- | :--- | :----- | :--------- | :------- | :--------- | | Principal | $0.1 | $0.1 | $0.1 | $0.1 | $350.0 | — | $350.4 | $366.8 | | Avg. Rate | 3.0% | 2.9% | 2.9% | 3.0% | 5.8% | —% | 5.8% | | [ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA](index=51&type=section&id=Item%208%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements and supplementary data for the past three fiscal years - The section includes the Report of Independent Registered Public Accounting Firm, Consolidated Statements of Operations, Comprehensive Income, Cash Flows, Balance Sheets, and Changes in Shareholders' Equity for the years ended December 31, 2021, 2020, and 2019[260](index=260&type=chunk) - The financial statements are presented in conformity with accounting principles generally accepted in the United States of America (GAAP)[298](index=298&type=chunk) - Schedule II – Valuation and Qualifying Accounts for the years ended December 31, 2021, 2020, and 2019 is also included[284](index=284&type=chunk) [ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE](index=52&type=section&id=Item%209%20Changes%20In%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with accountants on accounting and financial disclosure matters [ITEM 9A. CONTROLS AND PROCEDURES](index=52&type=section&id=Item%209A%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of year-end 2021 - As of December 31, 2021, the company's disclosure controls and procedures were deemed **effective** to provide reasonable assurance that required information is recorded, processed, summarized, and reported timely[264](index=264&type=chunk) - Management concluded that internal control over financial reporting was **effective** as of December 31, 2021, based on the COSO Internal Control-Integrated Framework (2013)[266](index=266&type=chunk) - The assessment of internal control over financial reporting excluded the acquisition of NxEdge, which represented approximately **5.6% of total assets** and **0.7% of total revenues** as of and for the year ended December 31, 2021[267](index=267&type=chunk) [ITEM 9B. OTHER INFORMATION](index=53&type=section&id=Item%209B%20Other%20Information) The company has no other information to report under this item [ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS](index=53&type=section&id=Item%209C%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) The company has no disclosures regarding foreign jurisdictions that prevent inspections PART III [ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE](index=54&type=section&id=Item%2010%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, officers, and corporate governance is incorporated by reference from the 2022 proxy statement - Information on directors, executive officers, and corporate governance is incorporated by reference from the 2022 proxy statement[274](index=274&type=chunk) - The company has a written Code of Business Conduct applicable to all directors, officers, and employees, available on its website[275](index=275&type=chunk) [ITEM 11. EXECUTIVE COMPENSATION](index=54&type=section&id=Item%2011%20Executive%20Compensation) Details regarding executive compensation are incorporated by reference from the 2022 proxy statement - Executive compensation details are incorporated by reference from the 2022 proxy statement[276](index=276&type=chunk) [ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS](index=54&type=section&id=Item%2012%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership information is incorporated by reference, with details provided on equity compensation plan status - Security ownership data is incorporated by reference from the 2022 proxy statement[277](index=277&type=chunk) **Equity Compensation Plan Information (as of December 31, 2021)** | Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights (b) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c) | | :---------------------------------------------- | :-------------------------------------------------------------------------------------------- | :------------------------------------------------------------------------------ | :-------------------------------------------------------------------------------------------------------------------------------------------------- | | Equity compensation plans approved by security holders | 461,356 | $70.46 | 1,015,808 | | Equity compensation plans not approved by security holders | — | — | — | | **Total** | **461,356** | **$70.46** | **1,015,808** | [ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE](index=54&type=section&id=Item%2013%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on related transactions and director independence is incorporated by reference from the 2022 proxy statement - Information on director independence is incorporated by reference from the 2022 proxy statement[280](index=280&type=chunk) [ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES](index=55&type=section&id=Item%2014%20Principal%20Accountant%20Fees%20and%20Services) Details regarding principal accountant fees and services are incorporated by reference from the 2022 proxy statement - Information on principal accountant fees and services is incorporated by reference from the 2022 proxy statement[281](index=281&type=chunk) PART IV [ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES](index=55&type=section&id=Item%2015%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the financial statements, schedules, and exhibits filed as part of the annual report - The report includes financial statements listed in Part II, Item 8[283](index=283&type=chunk) - Financial Statement Schedule II – Valuation and Qualifying Accounts for the years ended December 31, 2021, 2020, and 2019 is provided[284](index=284&type=chunk) - A comprehensive Exhibit Index lists various agreements, plans, and certifications, including the Third Amended and Restated Credit Agreement and equity compensation plans[284](index=284&type=chunk)[287](index=287&type=chunk) [ITEM 16. FORM 10-K SUMMARY](index=55&type=section&id=Item%2016%20Form%2010-K%20Summary) The company does not provide a Form 10-K summary

Company Overview - Enpro's market capitalization was $2.31 billion as of February 22, 2022[9] - The company's 2021 revenue reached $1.14 billion[9] - Adjusted EBITDA for 2021 was $208 million, representing an 18.3% margin[9] - Aftermarket revenue accounted for 48% of the company's total revenue in 2021[9] Segment Performance (2021) - Sealing Technologies generated $599.8 million in revenue with an adjusted EBITDA of $141.4 million, resulting in a 23.6% adjusted EBITDA margin[13] - Advanced Surface Technologies reported $247.3 million in revenue and $73.2 million in adjusted EBITDA, achieving a 29.6% adjusted EBITDA margin[13] - Engineered Materials had $302.4 million in revenue and $43.3 million in adjusted EBITDA, with a 14.3% adjusted EBITDA margin[13] Financial Performance - The company's revenue increased from $1.074 billion in 2020 to $1.142 billion in 2021[50] - Adjusted EBITDA margin improved from 15.7% in 2020 to 18.3% in 2021[50] - Free cash flow increased from $39.3 million in 2020 to $124.1 million in 2021[53] 2022 Guidance - The company anticipates low double-digit revenue growth in 2022[56] - Adjusted EBITDA is projected to be between $263 million and $275 million[56] - Adjusted diluted EPS is expected to be in the range of $6.70 to $7.25[56]

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