Babcock & Wilcox Enterprises : Presentation (opens in new window)

Gateway Conference

September 2021

Safe Harbor Statement

B&W Enterprises cautions that this presentation contains forward-looking statements, including, without limitation, statements relating to adjusted EBITDA and sales targets, expectations regarding future growth, expansion and profitability, as well as statements about B&W's future pipeline of new projects and business within its Renewable, Environmental and Thermal operating segments and their impact on future shareholder value. These forward-looking statements are based on management's current expectations and involve a number of risks and uncertainties, including, among other things, the impact of COVID-19 on us and the capital markets and global economic climate generally; our recognition of any asset impairments as a result of any decline in the value of our assets or our efforts to dispose of any assets in the future; our ability to obtain and maintain sufficient financing to provide liquidity to meet our business objectives, surety bonds, letters of credit and similar financing; our ability to comply with the requirements of, and to service the indebtedness under, our debt facility agreements; our ability to pay dividends on our 7.75% Series A Cumulative Perpetual Preferred Stock, the highly competitive nature of our businesses and our ability to win work, including identified project opportunities in our pipeline; general economic and business conditions, including changes in interest rates and currency exchange rates; cancellations of and adjustments to backlog and the resulting impact from using backlog as an indicator of future earnings; our ability to perform contracts on time and on budget, in accordance with the schedules and terms established by the applicable contracts with customers; failure by third-party subcontractors, partners or suppliers to perform their obligations on time and as specified; our ability to successfully resolve claims by vendors for goods and services provided and claims by customers for items under warranty; our ability to realize anticipated savings and operational benefits from our restructuring plans, and other cost-savings initiatives; our ability to successfully address productivity and schedule issues in our B&W Renewable, B&W Environmental and B&W Thermal segments, including the ability to complete our B&W Renewable's European EPC projects and B&W Environmental's U.S. loss projects within the expected time frame and the estimated costs; our ability to successfully partner with third parties to win and execute contracts within our B&W Renewable, B&W Environmental and B&W Thermal segments; changes in our effective tax rate and tax positions, including any limitation on our ability to use our net operating loss carryforwards and other tax assets; our ability to successfully manage research and development projects and costs, including our efforts to successfully develop and commercialize new technologies and products; the operating risks normally incident to our lines of business, including professional liability, product liability, warranty and other claims against us; changes in, or our failure or inability to comply with, laws and government regulations; actual or anticipated changes in governmental regulation, including trade and tariff policies; difficulties we may encounter in obtaining regulatory or other necessary permits or approvals; changes in, and liabilities relating to, existing or future environmental regulatory matters; changes in actuarial assumptions and market fluctuations that affect our net pension liabilities and income; the Company's ability to successfully compete with current and future competitors; the Company's ability to negotiate and maintain good relationships with labor unions; changes in pension and medical expenses associated with its retirement benefit programs; social, political, competitive and economic situations in foreign countries where it does business or seeks new business; the termination of our prior credit agreement and the restrictions on operations under our new revolving credit agreement; and the other factors specified and set forth under "Risk Factors" in our periodic reports filed with the Securities and Exchange Commission, including, without limitation, the risks described in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 and Quarterly Report on Form 10-Q for the quarters ended March 31, 2021 and June 30, 2021 under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" (as applicable). These factors should be considered carefully, and B&W Enterprises cautions not to place undue reliance on these forward-looking statements, which speak only as of the date of this presentation, and undertakes no obligation to update or revise any forward-looking statement, except to the extent required by applicable law.

Non-GAAP Financial Measures

This presentation contains information regarding our adjusted EBITDA (including calculated on a pro forma basis to show the effect of certain changes in our operations and strategic focus going forward) and adjusted gross profit, which are non GAAP financial measures. Adjusted EBITDA on a consolidated basis is defined as the sum of the adjusted EBITDA for each of the segments, plus allocations to corporate and research and development costs. At a segment level, adjusted EBITDA is consistent with the way our chief operating decision maker reviews the results of operations and makes strategic decisions about the business and is calculated as earnings before interest, tax, depreciation and amortization adjusted for items such as gains or losses on asset sales, net pension benefits, restructuring costs, impairments, gains and losses on debt extinguishment, costs related to financial consulting, research and development costs and other costs that may not be directly controllable by segment management and are not allocated to the segment. We present consolidated Adjusted EBITDA because we believe it is useful to investors to help facilitate comparisons of our ongoing, operating performance before corporate overhead and other expenses not attributable to the operating performance of our revenue generating segments. In this presentation, we also present certain targets for our adjusted EBITDA in the future; these targets are not intended as guidance regarding how we believe the business will perform. We are unable to reconcile these targets to their GAAP counterparts without unreasonable effort and expense due to the aspirational nature of these targets. This presentation also presents adjusted gross profit. We believe that adjusted gross profit by segment is useful to investors to help facilitate comparisons of the ongoing, operating performance by excluding expenses related to, among other things, activities related to the spin off, activities related to various restructuring activities we have undertaken, corporate overhead (such as SG&A expenses and research and development costs) and certain non-cash expenses such as intangible amortization and goodwill impairments.

© 2021 Babcock & Wilcox Enterprises, Inc. All rights reserved.

B A B C O C K & W I L C O X E N T E R P R I S E S , I N C .

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Executive Summary

Strong Global Brand

Babcock & Wilcox provides high-quality, innovative renewable, environmental and thermal technologies and has served critical power generation and industrial applications for more than 150 years.

Executing a Transformation

B&W is executing a robust growth strategy after:

• Recovering from losses related to several expanded-scope projects, returning to its core technology and delivery model
• Implementing $137 million in cost savings initiatives, with another $5 million identified, and
• Reducing total secured debt by $347 million in 2021 to position for growth and support clean energy growth initiatives

Positioned for Growth

B&W's transformation is gaining momentum, with new branding and a global expansion underway to pursue more than $6 billion in identified project opportunities in high-growth markets over the next three years. B&W is pursuing a further expansion of its clean energy portfolio through innovation and acquisition.

Building Toward the Future

After achieving ~$66 million in adjusted EBITDA in the 12 months ended June 30, 2021, B&W is targeting1:

• FY2021 adjusted EBITDA of $70-$80 million
• FY2022 adjusted EBITDA of $95-$105 million

Advancing energy and environmental solutions that bring power and progress to our world

1. The most comparable GAAP target information is not available without unreasonable effort; based on Q2 2021 results

	B A B C O C K & W I L C O X E N T E R P R I S E S , I N C .	Disclaimer: B&W Enterprises cautions not to place undue reliance on any forward-looking statements, which speak only as of the date of this presentation and may be	3
© 2021 Babcock & Wilcox Enterprises, Inc. All rights reserved.	impacted by the risks described in our SEC reports including, without limitation, the impact of COVID-19 on us and the capital markets and global economic climate generally.
		We undertake no obligation to update or revise any forward-looking statement, except to the extent required by applicable law.

Next Generation B&W

B&W FOUNDATION DRIVES GROWTH STRATEGY

Advanced Technologies

Research & Innovation

Global Brand Equity

High-Growth End Markets

Vast Installed Base

A Circular Economy

For our economy and future generations, we continually develop ecologically sound ways of recycling resources, like biomass and waste, to create clean, renewable baseload power while reducing greenhouse gas emissions.

The Clear Choice for Our Climate

As an industry leader in providing advanced air emissions control and energy recovery equipment and technologies, our engineered solutions are designed to reduce the environmental impact of industrial processes.

Efficient. Safe. Reliable.

From the initial patent for the water-tube safety boiler to the world's first supercritical boiler to technologies using the latest advanced steam cycles, our robust thermal energy designs deliver availability and long-term operation.

The next generation Babcock & Wilcox is providing innovative environmental and renewable solutions,

generating recurring revenues from a broad thermal installed base and expanding globally

© 2021 Babcock & Wilcox Enterprises, Inc. All rights reserved.

B A B C O C K & W I L C O X E N T E R P R I S E S , I N C .

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What We Do

RENEWABLE

Technologies for Renewable Power & Resource Recovery

Waste-to-energy and biomass-to-energy baseload power, chemical recovery boilers for pulp & paper, multi-fuel technology, Dynagrate® and vibrating combustion grates

ENVIRONMENTAL

Technologies for a Clean Environment

Emissions controls, ash handling systems for bottom and fly ash, submerged grind conveyors, wet, dry and hybrid cooling systems, carbon capture

Technologies for Efficient Steam Generation

THERMAL

Boilers, ancillary equipment and global aftermarket parts, service and upgrade offerings to effectively utilize a wide range of fuels for power or industrial applications

Delivering value to our customers through technology-driven products and services, with 600 active patents worldwide

Continual product improvement and research and development to support future needs, including carbon capture

© 2021 Babcock & Wilcox Enterprises, Inc. All rights reserved.

B A B C O C K & W I L C O X E N T E R P R I S E S , I N C .

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