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Stifel Conference
Patrick GorisSenior Vice President and Chief Financial Officer
June 12, 2018
Blake MoretChairman and Chief Executive Officer
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SAFE HARBOR STATEMENT
THIS PRESENTATION INCLUDES STATEMENTS RELATED TO THE
EXPECTED FUTURE RESULTS OF THE COMPANY AND ARE THEREFORE
FORWARD-LOOKING STATEMENTS. ACTUAL RESULTS MAY DIFFER
MATERIALLY FROM THOSE PROJECTIONS DUE TO A WIDE RANGE OF
RISKS AND UNCERTAINTIES, INCLUDING THOSE THAT ARE LISTED IN
OUR SEC FILINGS.
THIS PRESENTATION ALSO CONTAINS NON-GAAP FINANCIAL
INFORMATION AND RECONCILIATIONS TO GAAP ARE INCLUDED IN THE
APPENDIX. ALL INFORMATION SHOULD BE READ IN CONJUNCTION WITH
OUR HISTORICAL FINANCIAL STATEMENTS.
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B U S I N E S S U P D A T E
R O K / P T C S T R A T E G I C P A R T N E R S H I P
C A P I T A L D E P L O Y M E N T U P D A T E
Agenda
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at A GLANCE
80+COUNTRIES
22,000$6.3B
Innovation
Domain expertise
Culture of integrity & corporate responsibility
SERVINGCUSTOMERS FOR
115 YRS
FISCAL 2017 SALES
WORLD’S LARGEST COMPANY DEDICATED
TO INDUSTRIAL AUTOMATION AND INFORMATION
VALUE CREATIONABOVE-MARKET GROWTH | PRODUCTIVITY | INTELLECTUAL CAPITAL
EMPLOYEES
for a broad rangeof industries
AUTOMATION SOLUTIONS
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Fiscal 2018 First Half Highlights
ORGANIC
SALES
SEGMENT
OPERATING MARGIN
ADJUSTED
EPS
$3.85, up 17% YOY
FREE CASH
FLOW
Conversion of 108%
CAPITAL
DEPLOYMENT
Redeployed ~$0.9B in dividends and repurchases
4.4% YOY
Broad-based growth across all regions
Growth led by heavy industries
Automotive sales down YOY, but up sequentially from Q1 to Q2 – recovery in MRO business
Emerging markets up high single digits
150 bps YOY
Strong performance driven by higher sales and productivity, partially offset by investments
Ramping up investments to accelerate profitable growth and increase long-term differentiation
First half R&D spend up 9% YOY
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Solid macroeconomic indicators and favorable global
manufacturing environment
Early stages of manufacturing expansion cycle
Continued broad-based organic growth across most
regions and verticals
Heavy Industry verticals – largest growth driver
Transportation expected to grow sequentially; flat to
slightly down for the full year
Strong H1 book-to-bill and backlog expected to drive
higher Solutions & Services growth
Increasing investments to expand the value of
The Connected Enterprise
Integration of our software with other design tools
Scalable analytics and subscription services
Fiscal 2018 Second Half Outlook
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APRIL
GUIDANCE
JANUARY
GUIDANCE
Sales ~ $6.7B ~ $6.7B
Organic Growth Range 3.5% to 6.5% 3.5% to 6.5%
Currency Translation ~ 2% ~ 2%
Divestiture ~ (1)% ~ (1)%
Segment Operating Margin ~ 21.5% ~ 21.5%
Adjusted Effective Tax Rate ~ 20.5% ~ 21%
Adjusted EPS $7.70 - $8.00 $7.60 - $7.90
Free Cash Flow as a % of Adjusted Income ~ 105% ~ 100%
Note: As of April 25, 2018
Fiscal 2018 Guidance – As of April 25, 2018
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ROK / PTC Strategic Partnership
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Cross-selling and marketing of each other’s software for
industrial applications
Collaboration on integration of products and
complementary technology roadmaps
ROK’s solutions business will be a preferred delivery and
implementation provider, supported by a robust
ecosystem of partners
Where customer applications require other design tools,
like CAD and PLM, we have the option of simplified
integration of PTC’s strong offering in those areas
ROK to invest $1B at a price of $94.50 for ~10.6M
shares of PTC stock (~8.4% ownership)*
Investment reflects confidence in significant upside
for both companies
Blake Moret to join PTC Board of Directors effective
with closing of equity transaction
O W N E R S H I P / E Q U I T Y I N V E S T M E N T
P A R T N E R S H I P S T R U C T U R E
C O M M E R C I A L R E L AT I O N S H I P S T R U C T U R E
*Based on PTC’s current outstanding shares pro forma for the share issuanceto Rockwell Automation
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Leverage companies’
complementary
resources, technologies,
industry expertise
and market presence
Combination of offerings creates industry-
leading industrial information platform with
best-in-class IIoT and analytics capabilities
Accelerates and expands ability to deliver
The Connected Enterprise – driven by
ROK and PTC’s domain and delivery
expertise
Faster go to market
Enhances differentiation of
our total portfolio
Accelerates revenue growth
in information solutions and
connected services
New project delivery revenue
streams
Increases recurring revenue
stream
Enhanced Customer Value via
Industry Leading IIoT Capabilities
Accelerates
Profitable Growth
S T R A T E G I C R A T I O N A L E S T R A T E G I C A L L I A N C E
S T R A T E G I C P A R T N E R S H I P
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Access to real-time
data from the
broadest variety of
sources
Simplicity of a single
platform integrating
control and a broader
set of information
Open architecture –
partnership approach
now including PTC
The Connected EnterpriseWhat Sets Us Apart
Information Solutions and Connected Services revenue approaching $300M in FY18
Now projecting to more than double by 2022
Scalable analytics
and easy-to-configure
enterprise
visualization
Domain expertise to
contextualize and
convert data into
actionable insights
UNDERSTANDING COMBINING SIMPLIFYING
Source: EPG presentation 05/21/2018
BENEFITS OF PTC PARTNERSHIP
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Leading IIoT
and Scalable
Analytics Platform
Enabling
IT/OT
Convergence
Industry
Application
Expertise and
Global Delivery
Faster time to value through improved device connectivity
Improved decision making through enhanced Self Service Analytics
Ability to scale and extend solutions from device to cloud
Full portfolio of solutions across Design–Operate-Maintain lifecycle
Commercial and technical resources that can bridge IT/OT domain
Combined partner ecosystem that provides access to wide range of
IT/OT capabilities
Domain expertise across the Design-Operate-Maintain lifecycle
IT-centric delivery resources with industrial application expertise
Repeatable solutions and programmatic global roll out capabilities
Together we have the
most comprehensive and
flexible information
software offering in the
industrial space
E N H A N C E C U S T O M E R V A L U E
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Open – Secure – Scalable
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Source: EPG presentation 05/21/2018
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DESIGN
CAD, PLM, SIMULATION
MAINTAIN, SUPPLY CHAIN
SLM
DIGITAL THREAD
OPERATE
ThingWorx
Vuforia Augmented Reality
Kepware Communication Drivers
PLM, CAD Expertise
Service Lifecycle Management
Industry-specific MES Applications
FactoryTalk Analytics
Fit for Purpose Applications
Real-time, Secure Gateway
Our combined capabilities create the most comprehensive,
flexible industrial information platform in the market
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Capital Deployment Update
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Increased Capital DeploymentDisciplined Capital Deployment will Continue
Organic growth – mainly P&L investments
FY17 restructuring helps fund increased investments while retaining ~35%
earnings conversion
Acquisitions
Expanded corporate development team fully staffed
Active pipeline for partnerships and acquisitions
Key areas: information software, connected services, process expertise,
regional share expansion with smart products
Dividends and share repurchases
Increased share repurchase target from $0.5B to $1.2B for FY18
Increased dividend by 10% in November 2017 and by 10% in April 2018
Source: EPG presentation 05/21/2018
$1.5B
We retain flexibility to invest in additional value-creating opportunities
Update since EPG
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Conclusion
ROK / PTC strategic partnership creates the most
comprehensive and flexible information software offering
in the industrial space for customers to drive positive
business outcomes
Partnership complements and accelerates our ability to
deliver The Connected Enterprise, accelerating profitable
growth with increased recurring revenue streams
Equity investment in PTC reflects confidence in significant
upside for both companies
ROK retains significant financial flexibility to invest in
additional value-creating opportunities
www.rockwellautomation.com
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Thank You
