Gardner Denver, Inc. (GDI) Reports Prelim. FY19 Results

Gardner Denver Holdings, Inc. (NYSE: GDI) announced today selected full year 2019 preliminary unaudited financial results ahead of commencing the financing process associated with the Ingersoll Rand transaction.

The Company anticipates reporting full year 2019 revenues of $2.5 billion, Income before income taxes of $191 million, and Adjusted EBITDA of $565 million, resulting in Adjusted EBITDA as a percentage of revenues of 23.0%. In addition, the Company expects to report annual cash flow from operating activities of $343 million and $43 million in capital expenditures, resulting in free cash flow of $300 million. Total debt as of December 31, 2019 is expected to be $1.6 billion, Net debt as of December 31, 2019 is expected to be $1.1 billion and Net debt to Adjusted EBITDA leverage for the year is expected to be 2.0x. These unaudited financial results are preliminary and are subject to finalization of the Company’s quarterly and annual financial and accounting procedures.

(*Consensus sees FY19 revenue of $2.44 billion)

On April 30, 2019, Ingersoll Rand plc (“Ingersoll Rand”) and Gardner Denver announced they had entered into a merger agreement, whereby Ingersoll Rand’s Industrial Segment would be separated from Ingersoll Rand, spun off to Ingersoll Rand shareholders and subsequently combined with Gardner Denver in a Reverse Morris Trust arrangement. Later today, Gardner Denver intends to launch the marketing of (i) a $1,900 million 7-year Senior Secured Term Loan B in connection with the spin-off of Ingersoll Rand’s Industrial Segment and (ii) an amendment and extension of the Company’s existing Senior Secured Term Loans to align their maturity dates with the new Term Loan B, among other changes. As part of the financing activity, the Company is disclosing selected financial information contained in this release.

“We are pleased to announce the launch of the financing for the Ingersoll Rand transaction and excited about the strong finish to the year,” said Vicente Reynal, Chief Executive Officer. “The results are better than the mid-point of our most recent guidance for 2019 Adjusted EBITDA and Free Cash Flow, driven by solid commercial and operational execution across the segments and continued progress on improving net working capital. As we look ahead, optimizing our financing as part of the pending merger is a key step toward positioning the new company for future success. We look forward to our upcoming earnings call at which time we will provide a business update and discuss fourth quarter and full year 2019 results as well as provide an update on the status of the transaction, which continues to be on track to close in early 2020.”

Conference Call

Gardner Denver will broadcast a conference call to discuss results for the fourth quarter and full year ended December 31, 2019 on Tuesday, February 18, 2020 at 8:00 a.m. Eastern time through a live webcast. This webcast will be available in listen-only mode and can be accessed, for up to ninety days following the call, through the Investors section on the Gardner Denver website at http://investors.gardnerdenver.com.

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