Dover : Q3 2019 Earnings Presentation Slides

October 17, 2019 - 9:00am CT

Earnings Conference Call Third Quarter 2019

Forward-Looking Statements and Non-GAAP Measures

We want to remind everyone that our comments may contain forward-looking statements that are inherently subject to uncertainties and risks. We caution everyone to be guided in their analysis of Dover Corporation by referring to the documents we file from time to time with the SEC, including our Form 10-K for 2018, for a list of factors that could cause our results to differ from those anticipated in any such forward-looking statements.

We would also direct your attention to our website, dovercorporation.com, where considerably more information can be found.

In addition to financial measures based on U.S. GAAP, Dover provides supplemental non-GAAP financial information. Management uses non-GAAP measures in addition to GAAP measures to understand and compare operating results across periods, make resource allocation decisions, and for forecasting and other purposes. Management believes these non-GAAP measures reflect results in a manner that enables, in many instances, more meaningful analysis of trends and facilitates comparison of results across periods and to those of peer companies. These non-GAAP financial measures have no standardized meaning presented in U.S. GAAP and may not be comparable to other similarly titled measures used by other companies due to potential differences between the companies in calculations. The use of these non-GAAP measures has limitations and they should not be considered as substitutes for measures of financial performance and financial position as prepared in accordance with U.S. GAAP. Reconciliations and definitions are included either in this presentation or in Dover's earnings

release and investor supplement for the third quarter, which are available on Dover's website.

2

Q3 2019 - Highlights

Organic revenue growth of 6%

Net of 2% unfavorable FX impact

Solid growth across DF and DES businesses

Adjusted earnings from continuing operations(1) up 15% to $235M

Earnings from continuing operations on a GAAP basis up 31% to $206M

Organic bookings growth of 7%

Net of 2% unfavorable FX impact

DF and DES book-to-bill above 1

Adjusted diluted EPS from continuing operations(2) at $1.60, up 18%

$0.04 benefit related to discrete tax items(3)

Diluted EPS from continuing operations on a GAAP basis at $1.40, up 33%

Segment performance		Guidance & other activities
Adjusted EBIT(1) up 17% to $320M, at 17.5% margin		Narrowing 2019 Adj. EPS(2) guidance to $5.82 - $5.85
(+180 bps year-over-year)
			On track to begin reporting new segment structure
FCF 16.7% of revenue; strong FCF conversion		with Q4 '19 results
across all segments

(1) Non-GAAP measures (definitions and reconciliations in appendix)

3	(2) Adjusted diluted EPS excludes acquisition-related amortization, rightsizing and other costs (reconciliation in appendix)
	(3) Includes $5.2M of discrete tax benefits in the quarter

Q3 2019 - Financial Summary

US GAAP from continuing operations	Q3 2019	Q3 2018	∆
Revenue ($M)	1,825	1,747	+4%
Earnings ($M)	206	157	+31%
Diluted EPS ($)	1.40	1.05	+33%
Non-GAAP(1) from continuing operations
Adjusted EBIT - Segment ($M)	320	274	+17%
margin percent	17.5%	15.7%	+180 bps
Adjusted EBITDA - Segment ($M)	385	341	+13%
margin percent	21.1%	19.5%	+160 bps
Adjusted Earnings ($M)	235	203	+15%
Adjusted diluted EPS(2) ($)	1.60	1.36	+18%

Note: Numbers may not add due to rounding

4	(1)	Non-GAAP measures (definition and reconciliation in appendix)
(2)	Adjusted diluted EPS excludes acquisition-related amortization, rightsizing and other costs (reconciliation in appendix)

Q3 2019 - Revenue & Bookings

Revenue Split

4%

13%

By

Region 54%

21%

8%

US

OTHER AMER.

EUROPE

ASIA

OTHER

20%

By 39%

Segment

Revenue

Change in Organic Revenue: +$98M, or 5.6%

1,747	42	68	-12	-29	9	1,825	($M)
Q3 2018	DES	DF	DRFE	FX	ACQ./	Q3 2019
	ORG.	ORG.	ORG.		DISP. (1)

Bookings

Change in Organic Bookings: +$114M, or 6.7%

-3%

41%

DES

DF

DRFE

1,717	61	61	-8	-27	9	1,814	($M)
Q3 2018	DES	DF	DRFE	FX	ACQ./	Q3 2019
	ORG.	ORG.	ORG.		DISP. (2)

Note: Numbers may not add due to rounding

5	(1)	Acquisitions: $18M, dispositions: $9M
(2)	Acquisitions: $16M, dispositions: $7M