Bruker drives profitable growth and margin …...Bruker Year-To-Date FY 2017 financials(1) Improved...

© Bruker Corporation

Bruker drives profitable growth and margin expansion by enabling scientific discoveries and by delivering high-

performance analytical, life science and diagnostic solutions

Innovation with Integrity

November 15, 2017

Bruker Corporation Safe Harbor Statement

Any statements contained in this presentation that do not describe historical facts may constitute forward-looking statements

within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current

expectations, forecasts and assumptions of our management and are subject to risks and uncertainties that could cause actual

results to differ materially from those indicated, including, but not limited to, risks and uncertainties relating to: adverse

changes in conditions in the global economy and volatility in the capital markets; the integration of businesses we have

acquired or may acquire in the future; fluctuations in foreign currency exchange rates; implementation of strategies for

improving our operating margins, profitability and cash flow; changing technologies; product development and market

acceptance of our products; the cost and pricing of our products; competition; dependence on collaborative partners, key

suppliers and contract manufacturers; capital spending and government funding policies; changes in governmental regulations;

the use and protection of intellectual property rights and other risk factors discussed from time to time in our filings with the

Securities and Exchange Commission, or SEC. These and other factors are identified and described in more detail in our most

recent reports filed with the SEC, including, without limitation, our annual report on Form 10-K for the year ended December

31, 2016, our most recent quarterly reports on Form 10-Q and our current reports on Form 8-K. We expressly disclaim any

intent or obligation to update these forward-looking statements other than as required by law.

© Bruker Corporation 2

Key Messages & Financial Objectives

1. Bruker is a differentiated leader in attractive markets for analytical, life science and diagnostic tools, and our brand stands for innovation:

Market leader in unique, high value technologies: NMR, MALDI-TOF, MALDI BioTyper, FTMS, AFM, XRD & Superconductors

Fundamental Portfolio Transformation towards six major opportunities with higher growth and sustainable higher margins

2. We expect to continue our revenue growth:

Recent end market improvement (Academic in Europe and the US, Global Industrial)

On track to resume organic revenue growth in 2017, plus incremental M&A contributions

Goal to move towards LST & DX market growth in 2018

3. We target multi-year operating margin expansion:

In 2015-2016, achieved +460 bps of 2-year cumulative non-GAAP operating margin expansion

In 2017, targeting 70-100 bps operating margin expansion (including -40 bps M&A headwind)

Operational Excellence and Portfolio Transformation are key drivers of margin expansion

Goal: expand operating margin 75-100 bps per year, on average, over a multi-year timeframe

4. We aim for high ROIC by investing in high-value innovation and disciplined M&A

BRKR Non-GAAP ROIC >20% in both FY16 and FY15


Bruker Overview • Founded in 1960

• FY2016 revenue: ~$1.6 billion

• R&D investment: ~9% of revenue

• ~75% of revenue from scientific

and diagnostic instruments

• ~6,000 employees worldwide

• After major restructuring and Transformation in 2013-2016, on to Portfolio Transformation and Operational Excellence phases

• Long-term oriented ownership: ~36% owned by insiders

• Quarterly dividend: ~$0.04/share

• Announced two-year $225M share repurchase in May 2017

33%

29%

28%

10%

BioSpin

Three Primary Life Science Tools Groups with Global Footprint Revenue breakdown, % of LTM revenue(1):

37%

29%

5% 29%

CALID

NANO

75%

25%

Systems

Life Science Research in Academia,

Medical Schools and Government

Pharma/Biopharma

Diagnostic Labs & Hospitals

Applied Markets

Industrial & Next-Gen Semicon Metrology

Superconductors for Science & MRI

Large, diverse end markets:


BEST

Service & After-market

Americas

Europe

Rest of World

APAC

4 (1) For the last twelve months, ended Sept. 30, 2017

BRUKER HAS #1 OR #2 MARKET POSITION FOR >60% OF PRODUCT PORTFOLIO


Three Life Science Tools & Diagnostics (LST & DX) Groups

NMR/EPR & NMR Phenomics

Preclinical Imaging & MALDI Imaging

MALDI BioTyper FT-IR/NIR, X-Ray Diffraction (XRD),

Next-Gen Semicon Metrology

Atomic Force Microscopy

BioSpin Group ~33% of LTM (1) revenue

• NMR/EPR for Life-Science Research & Pharma

• Applied, Industrial & Clinical MR

• Preclinical Imaging

• Services & Life-Cycle Support

NANO Group ~28% of LTM (1) revenue

• Atomic Force Microscopy

• Fluorescence Microscopy for Cell Biology &

Neuroscience

• X-Ray for Materials Research, QC

• Next-Gen Semicon Metrology

• Service & After-Market business

CALID Group ~29% of LTM (1) revenue

• Mass Spectrometry for

• Proteomics & Metabolomics • Applied & Pharma • Microbiology & Pathology

• FT-IR/NIR/Raman for Applied Markets

• CBRNE Detection for Security

• Service, Consumables & Software

5

(1) For the last twelve months, ended Sept. 30, 2017

Bruker Year-To-Date FY 2017 financials(1)

Improved revenue growth and further operating margin expansion, 2016 tax

rate affects EPS comparisons

47.8% 47.3%

Non-GAAP Gross Margin

12.8% 13.4%

Non-GAAP Operating Margin

$0.73 $0.70

YTD FY 2016YTD FY 2017

Non-GAAP EPS

$1,141Mil

$1,235Mil

Revenues

-50 bps +60 bps -4% +$94M

YTD FY 2016 YTD FY 2017


* Non-GAAP gross margin, non-GAAP operating margin, and non-GAAP EPS are non-GAAP measures. Reconciliations of these measures to the most directly comparable GAAP measures are available at the end of this presentation and on Bruker’s website at http://ir.bruker.com/investors/press-releases/earnings-releases/default.aspx

6

(1) For the nine months ended Sept. 30, 2017 and 2016

FY 2017 Guidance

Revenue Growth y-o-y +8% to +8.5%

Non-GAAP Operating Margin Expansion y-o-y(2)(3)

+70 bps to +100 bps

Non-GAAP EPS $1.17 to $1.20

FY 2017 Guidance: Return to organic revenue growth,

sustain operating margin expansion(1)

Organic revenue growth: +2.5% to +3%

Acquisition revenue growth: +4.5%

FX revenue tailwind: +1%

Non-GAAP tax rate: ~25%

Fully diluted share count: ~159M shares

Capex: ~$45M

FX assumptions as of September 30, 2017:

USD = 112.7 Yen

EUR = 1.18 USD

CHF = 1.03 USD

2017 ASSUMPTIONS

(1) As of November 2, 2017

(2)From a FY2016 non-GAAP operating margin of 14.8%.

(3)Includes approximately -40 bps cumulative negative effect from 2016 and 2017 acquisitions.


Portfolio Transformation Starting to ‘move the needle’ in 2018 and beyond

Phenomics & Proteomics

Biopharma & Applied

Microbiology & Diagnostics

Neuroscience & Cell Microscopy

Next-gen Nanotechnology Tools

After-Market: Services, Software

& Consumables

Six Key High-Growth & High-Margin Initiatives:

Commercial Excellence

Product R&D Excellence

Operational Excellence

Portfolio

Growth

Cost



• NMR for phenomics research

• International Phenome Center

Network (IPCN) with Bruker as key

NMR partner

• Phenomics to grow rapidly in next

decade in clinical research and

diagnostics

• timsTOFTM Trapped Ion Mobility,

impact II & maXis II UHR-QTOFs

• TIMS is game-changing for

high-throughput

clinical proteomics and

MS-based phenomics

Phenomics by NMR Proteomics & Phenomics by Mass Spec

Portfolio Transformation


• Structural biology with dynamics and

function

• Unique for Intrinsically Disordered

Proteins (IDPs)

• Recent breakthroughs in biological

solid-state NMR for membrane

proteins and protein aggregates (e.g.

in neurodegeneration)

Structural Biology by GHz-Class NMR

NEW at HUPO (September 2017): • timsTOFTM Pro with PASEF for shotgun proteomics

NEW Platform at ENC (March 2017): • Next-gen Avance NEO

9


• Label-free ultra-high throughput MS-screening on

millions of compounds in pharma drug discovery

• Accelerates drug discovery

Biopharma: rapifleX MALDI PharmaPulse™

• Extreme resolution Magnetic Resonance Mass

Spectrometry (MRMS) for

− MALDI Imaging in drug & metabolism imaging

− biomarker discovery in cancer research

Biopharma: MALDI Drug Imager™

Applied Markets: NMR FoodScreeners™

• Bruker NMR, MS and FT-IR/NIR instruments used for quality,

authenticity and safety testing in food analysis

• NMR HoneyScreener™ and WineScreener™: detect and quantify

ingredients in short, automated, high-value and low-cost analyses


Biopharma & Applied Market

NEW applied markets solution at ASMS (June 2017): ToxTyper 2.0E • Routine forensic toxicology of hundreds of compounds in minutes

NEW Biopharma solutions at ASMS 2017: SCiLS Lab and SCILS Cloud • Industry-leading software for large-scale, multi-

center MS Imaging research

10


Clinical Microbiology: MALDI Biotyper



• MALDI Biotyper identifies bacteria, yeasts and fungi more

accurately and with short time-to-result (TTR)

• Global installed base ~2,600 systems

• Comprehensive development roadmap:

− ‘gold standard’ ID

− ID from positive blood culture in sepsis

− select antibiotic resistance & susceptibility assays

− syndromic panels

NEW Consumable Products in 2017:

• MBT Star®-Carba IVD: CE-IVD assay for mass spec-based

antibiotic resistance testing on MALDI Biotyper • High-value PCR Assays (no culture): Fungiplex Aspergillus,

Fungiplex Candida and Carbaplex Resistance CE-IVD assays

NEW System at ASM Microbe

(June 2017): IR Biotyper • For strain typing and infection control in hospital hygiene laboratories

• rapifleX MALDI Mass Spec enabling MS Imaging in pathology translational research to complement IHC

Clinical Research: MALDI TissueTyper™

11




Next-gen Optogenetics & Super-Resolution Cell Microscopy

• Simultaneous, all-optical stimulation and

imaging platforms for neuroscience research

• Multi-cell brain research: decode neural

connectivity and networks

• Deep 3D super-resolution microscopy for live-

cell research

Mouse spermatocyte courtesy of Jackson Labs

Recent Bruker Nano Acquisition (May 2017): Luxendo light sheet microscopy

• Proprietary single plane illumination microscopy

(SPIM) technique

• Reduces phototoxicity on living specimens

• Enables new research in embryology, live-cell

imaging, brain development, optogenetics

12



Next-Gen Nanotechnology Tools

Next-Gen Nanotechnology: X-Ray Semiconductor Metrology

• Logic and memory makers require

next-gen nano-metrology tools to

ensure yield and quality

• Bruker next-gen atomic force

microscopy (AFM) and X-ray

metrology tools are key for

advanced nodes and 3D chip

structures

13

Fast Growing After-Market Business Services, Software and Consumables

Focus on After-Market revenue

CALID 200

250

300

350

400

450

2013 2014 2015 2016

$ m

illio

ns

BIOSPIN

CALID

NANO


Focus on Service

14

From Transformation and Rightsizing (2013-2016)

to Operational & Commercial Excellence (2017-2020)

2013 2014 2015 2016 2017 2018-2020

Bruker BioSpin


& Cost Optimization

• Product R&D Excellence

• Lean Manufacturing

• Commercial Excellence

• ERP, CRM and Process

Bruker NANO

Bruker CALID

BEST

Outsourcing

Rightsizing

Rightsizing & Footprint Consolidation

Outsourcing

CAM Divestitures

Rightsizing & Footprint Consolidation

Outsourcing

Footprint Consolidation


Portfolio Transformation: Fundamentally reshaping the portfolio

for fast growth & continued multi-year margin expansion

Six Key High-Growth & High-Margin Initiatives:

Commercial Excellence

Product R&D Excellence


Portfolio

Growth

Cost

2017 est.: About 25% of Bruker’s revenue

Growing above LST market GM & OM above BRKR average



Biopharma & Applied



Next-gen Nanotechnology Tools

After-Market: Services, Software

& Consumables

16


www.bruker.com

17

Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures (unaudited)


(in millions, except per share amounts)

2017 2016

Reconciliation of Non-GAAP Operating Income, Non-GAAP Profit Before

Tax, Non-GAAP Net Income, and Non-GAAP EPS

GAAP Operating Income 121.0$ 100.3$

Non-GAAP Adjustments:

Restructuring Costs 8.5 12.8

Acquisition-Related Costs 9.4 10.4

Purchased Intangible Amortization 22.6 16.2

Other Costs 3.8 6.2

Total Non-GAAP Adjustments: 44.3$ 45.6$

Non-GAAP Operating Income 165.3$ 145.9$

Non-GAAP Operating Margin 13.4% 12.8%

Non-GAAP Interest & Other Expense, net (12.9) (11.1)

Non-GAAP Profit Before Tax 152.4 134.8

Non-GAAP Income Tax Provision (38.7) (15.4)

Non-GAAP Tax Rate 25.4% 11.4%

Minority Interest (1.3) (0.8)

Non-GAAP Net Income Attributable to Bruker 112.4 118.6

Weighted Average Shares Outstanding (Diluted) 159.9 162.7

Non-GAAP Earnings Per Share 0.70$ 0.73$

Nine Months Ended September 30,

Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures (Unaudited)



2017 2016

Reconciliation of GAAP and Non-GAAP Gross Profit

GAAP Gross Profit 557.8$ 522.1$


Restructuring Costs 1.6 6.4

Acquisition-Related Costs 5.6 2.3

Purchased Intangible Amortization 18.4 14.0

Other Costs 0.7 0.1

Total Non-GAAP Adjustments: 26.3 22.8

Non-GAAP Gross Profit 584.1$ 544.9$

Non-GAAP Gross Margin 47.3% 47.8%

Reconciliation of GAAP and Non-GAAP Tax Rate

GAAP Tax Rate 23.7% 4.3%


Tax Impact of Non-GAAP Adjustments 1.5% -2.4%

Tax Authority Settlements 0.0% 1.7%

Valuation Allowance Release 0.0% 9.3%

Other Discrete Items 0.2% -1.5%

Total Non-GAAP Adjustments: 1.7% 7.1%

Non-GAAP Tax Rate 25.4% 11.4%


Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures (Unaudited)



2017 2016

Reconciliation of GAAP and Non-GAAP Interest & Other Income (Expense), net

GAAP Interest & Other Income (Expense), net (11.8)$ (11.1)$


Bargain Purchase Gain (1.1) -

Non-GAAP Interest & Other Income (Expense), net (12.9)$ (11.1)$

Reconciliation of GAAP Operating Cash Flow and Non-GAAP Free Cash Flow

GAAP Operating Cash Flow 50.7$ 40.0$


Purchases of property, plant and equipment (31.3) (26.0)

Non-GAAP Free Cash Flow 19.4$ 14.0$

Reconciliation of GAAP Revenue and Non-GAAP Revenue

GAAP Revenue as of Prior Comparable Period 1,141.0$ 1,145.6$


Acquisitions and divestitures 60.4 23.5

Currency (5.1) (1.9)

Organic 39.1 (26.2)

Total Non-GAAP Adjustments: 94.4 (4.6)

Non-GAAP Revenue 1,235.4$ 1,141.0$

Organic Revenue Growth 3.4% -2.3%


Bruker Corporation Reconciliation of GAAP to NON-GAAP Financial Measures



For more information, visit Bruker’s website at http://ir.bruker.com/investors/press-releases/earnings-releases/default.aspx

With respect to the Company's outlook for 2017 non-GAAP operating margin, non-GAAP EPS and non-GAAP tax rate, we are not providing the most directly comparable GAAP financial measures or corresponding reconciliations to such GAAP financial measures on a forward-looking basis, because we are unable to predict with reasonable certainty certain items that may affect such measures calculated and presented in accordance with GAAP without unreasonable effort. Our expected non-GAAP operating margin, tax rate and EPS ranges exclude primarily the future impact of restructuring actions, unusual gains and losses, acquisition-related expenses and purchase accounting fair value adjustments. These reconciling items are uncertain, depend on various factors outside our management’s control and could significantly impact, either individually or in the aggregate, our future period operating margins, EPS and tax rate calculated and presented in accordance with GAAP.

2016 2015

Reconciliation of Non-GAAP Return on Invested Capital (ROIC)

Non-GAAP Operating Income (from above) 237.9$ 215.2$

Less: Non-GAAP Income Tax Provision (from above) (35.9) (43.4)

Non-GAAP Operating Income after Tax 202.0$ 171.8$

Average Total Invested Capital:

Average Long-Term Debt 328.8$ 310.1$

Average Current portion of Long-Term Debt 10.4 0.7

Average Total Shareholders' Equity 713.0 752.3

Less: Average Cash and Cash Equivalents (304.8) (293.3)

Average Total Invested Capital 747.4$ 769.8$

Return on Invested Capital (ROIC) 27.0% 22.3%

http://ir.bruker.com/investors/press-releases/earnings-releases/default.aspx






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Bruker drives profitable growth and margin …...Bruker Year-To-Date FY 2017 financials(1) Improved...

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