Invacare : Piper Sandler Conference – 12.2.20

C O R P O R A T I O N

Presentation (NYSE: IVC)

Piper Sandler Conference

c e m b e r 2 , 2 0 2 0

I N V A C A R E

I N V A C A R E C O R P O R A T I O N

This presentation contains forward-looking statements within the meaning of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those that describe future outcomes or expectations that are usually identified by words such as "will," "should," "could," "plan," "intend," "expect," "continue," "forecast," "believe," and "anticipate" and include, for example, any statement made regarding the company's future results. Actual results may differ materially as a result of various risks and uncertainties, including those expressed in the cautionary statement in the company's earnings press release for the third quarter 2020 posted on www.invacare.com/investorrelations, as well as in the company's annual reports on Form 10-K, quarterly reports on Form 10-Q and other filings with the Securities and Exchange Commission. The company may not be able to predict and may have little or no control over many factors or events that may influence its future results and, except as required by law, shall have no obligation to update any forward-looking statements.

Financial results presented are as of September 30, 2020, unless otherwise noted.

Invacare Presentation - Piper Sandler Conference: December 2, 2020

I N V A C A R E C O R P O R A T I O N

ABOUT US

Headquartered in Elyria, OH (outside of Cleveland), Invacare is proudly celebrating its 40th year of providing clinically complex medical devices and solutions which Make Life's Experiences Possible

As of September 30, 2020, the company had TTM revenue of $860M and 3,600 associates worldwide

The company primarily targets western-based reimbursement geographies in Europe, North America and Asia Pacific

WHAT WE DO

Invacare is a leading manufacturer and distributor in its markets for medical equipment used in non-acute care settings

The company's durable medical devices and solutions are designed for congenital, acquired, degenerative, conditions that help people to move, breathe, rest and perform essential hygiene for 24-hours of care

Invacare sells its products to private and government medical equipment providers and residential care providers

Invacare Presentation - Piper Sandler Conference: December 2, 2020

I O N

Solutions Across The Continuum Of Care

Providing essential clinical solutions for broad range of conditions

Solution Areas (24-Hours of Care)

C O R P O R A T

Move

Custom power and manual wheelchairs and custom seating

• Alternative drive controls and touch-screen technology
• Informatics

Rest

Home care and long-term care beds and therapeutic support surfaces

• Pressure relief for wound healing and prevention
• Continued pressure monitoring

	Breathe	Hygiene
Respiratory therapy products	Safe patient handling and hygiene
▪	Stationary and portable	▪ Patient transfer and bathing
	oxygen concentrators	equipment ensures resident and
▪	HomeFill® Oxygen systems	caregiver safety
		▪ Daily hygiene products

I N V A C A R E

Conditions	Congenital	Acquired	Degenerative
		Stroke	Multiple Sclerosis
	Cerebral Palsy	Spinal Cord Injury	ALS
	Muscular Dystrophy	Traumatic Brain Injury	COPD
	Spina Bifida	Post Acute Recovery	Bariatric
		Pressure Ulcers	Age Related
Settings
High Acuity		Invacare provides solutions outside high acuity settings	Low Acuity

Invacare Presentation - Piper Sandler Conference: December 2, 2020

Reported Net Sales *

ON		$450		$860
	$404
I
	$400		Million*
A T
	$350	$344
O R
	$300
O R P	millions)	$250
$200
C	(in
E		$150
R			$87
C A		$100
	$50
A			$25
V		$0
N
	Lifestyles	Mobility & Respiratory	Other
I
		Seating

* TTM sales as of September 30, 2020

Invacare Presentation - Piper Sandler Conference: December 2, 2020

Broad Product Line with High Clinical Value

Lifestyles

Globally focused on home healthcare and post-acute care, including aids for daily living, walking aids, lifts, wheelchairs, beds and surfaces

Mobility & Seating

Custom power and custom manual wheelchairs, seating and positioning, and power add-ons

Respiratory

Stationary concentrators and ambulatory oxygen such as portable concentrators and refilling devices for portable tanks

Other

Services and rentals

I N V A C A R E C O R P O R A T I O N

Strong Global Presence

$476M	$347M	$37M

Europe (56%)*	North America (40%)*	Asia Pacific (4%)*
Primarily single payor reimbursement	Primarily sell to durable medical	Primarily target western-based
systems which appreciate durable	equipment providers, equipment fleet	reimbursement countries, such as
medical equipment and total lowest	owners, residential care facilities and	Australia and New Zealand
cost of ownership	government agencies	Sales and distribution facilities in
Key markets focused on Western	Manufacturing facilities in the U.S.,	Australia, New Zealand and Thailand
Europe: France, Germany, UK, Benelux	Mexico and Canada
and the Nordic countries with a smaller
presence in southern Europe
Manufacturing facilities in Germany,
France, Portugal, UK and Sweden

* TTM sales as of September 30, 2020

Invacare Presentation - Piper Sandler Conference: December 2, 2020

COVID-19 Business Dynamics

Driving Two Patterns of Demand; Phasing of Peak and Return with Recovery

A C A R E C O R P O R A T I O N

Anatomy of Impact

Early ramp in Respiratory and Bed demand to support COVID-19 care

demand
normal%	1Q20	2Q20	3Q20

Elevated Respiratory demand continues

Past COVID-19 bed peak offset by limited long-term care access

Respiratory

• Above-normaldemand for stationary oxygen concentrators for COVID-19 response continued through 3Q20
• Winter COVID-19 resurgence still affecting profile of elevated demand

Lifestyle/Beds

• 2H20 demand for bed and other lifestyle products reflect mix shift from limited access to long-term care facilities and more at-home care during pandemic restrictions

Mobility & Seating

• Europe - easing of healthcare restrictions and shorter quote-order cycle resulted in sequential improvement in 3Q20 sales
• North America - easing of healthcare restrictions resulted in increased quote volume, which delays sales increase into 4Q20
• New product launches continue to drive increased interest

I N V

Mobility & Seating past bottom as clinic / healthcare access returns

NB - For illustrative purposes only; not drawn to scale

Outlook

• While overall access to healthcare is expected to improve during the winter months, intermittent pandemic-related closures may occur
• Sales patterns anticipated to evolve as planned

Invacare Presentation - Piper Sandler Conference: December 2, 2020

Third Quarter 2020 Financial Highlights

O R P O R A T I O N

Operating Income

• $0.5 million YOY driven by:
• • Reduced SG&A expenses
  • Partially offset by lower gross profit
  • Ongoing North American strength with operating income of $3.0 million
• $5.2 million sequentially driven by:
• • Higher net sales
  • Reduced SG&A expenses

Adjusted EBITDA

• $0.2 million YOY driven by:
• • $7.8 million reduction in constant currency SG&A expenses substantially offset by lower gross profit reduced net sales
• $3.2 million sequentially driven by:
• • Higher net sales primarily in Europe
  • Reduced SG&A expenses

Free Cash Flow

• $14.1 million YOY due to:
• • Net cash used for operating activities to support working capital needs

• $0.1 million sequentially driven by:
• • Higher profitability
  • Lower inventory
  • Offset by increased working capital

I N V A C A R E C

	$2.9	$10.0	$9.6	$9.8
$3.0
$2.4		$8.0
$2.0		$6.0
	+21%	$4.0		+3%
$1.0
		$2.0
$0.0		$0.0
3Q19	3Q20		3Q19	3Q20

$12.3

$12.0

$7.0

$2.0
($3.0)	($1.8)
3Q20
3Q19

Sequential improvement in net sales and strong cost containment measures drove improved profitability

Invacare Presentation - Piper Sandler Conference: December 2, 2020

I N V A C A R E C O R P O R A T I O N

COVID-19: Financial and Operating Assumptions

Revenue

• Sequential increase in consolidated net sales in 4Q20, staying lower than prior year
• Europe expected to recover more slowly than the U.S. due to more stringent public healthcare restrictions
• Mobility & seating impacted by limited access to healthcare facilities, expected to begin recovery with the resumption of elective care
• Elevated demand for respiratory products related to the pandemic

Expenses & Margins

• Gross margins expected to be impacted as product mix returns to more normalized levels

❑ Operational and cost management actions implemented to mitigate margin dilution:

• Limiting the number of product models being sold to improve manufacturing efficiency
• Reducing discretionary spending

Balance Sheet & Cash

• Retired nearly all of the convertible debt maturing in 2021, leaving less than $1.3 million outstanding
• Extended a significant portion of convertible debt maturing in 2021 and 2022, to 2024
• Accessed government-based loans and other programs which bolster short-term liquidity, including loans and temporary delays of direct and indirect tax payments

Invacare Presentation - Piper Sandler Conference: December 2, 2020

I N V A C A R E C O R P O R A T I O N

Initiatives Accelerating Our Transformation

Award winning clinical solutions and full product pipeline:

• Launched center-wheel and front-wheel drive standing positioning system with clinical and social benefits of vertical positioning, including pediatric standing system
• First wirelessly remote-controlled portable oxygen concentrator
• First with hydroforming technology that allows production of manual wheelchairs with significantly higher performance without increased weight
• Invacare Ampla Action bariatric wheelchair - winner of the Red Dot Award: Product Design 2019, Platinum A'Design Award, and German Design Award 2020

Operational improvements to expand margins and accelerate profitability:

• Benefit of expanded gross profit from plant consolidations in France
• Implementing plant consolidations in German facilities to be completed in late 2020
• Achieved significant improvement in material and freight costs through proactive supply chain actions

Partnership with Birlasoft Solutions to modernize business with flexible IT systems to:

• Drive operational efficiencies
• Improve our customers' experience
• Generate substantial cost savings

Invacare Presentation - Piper Sandler Conference: December 2, 2020

Track Record of Optimization

Aligning footprint with new commercial strategy and sales level

C A R E C O R P O R A T I O N

Oct 31

Headcount reduction

Dec 1
Dallas, Texas
DC closure				Aug 1
					Cranberry, NJ
				DC Closure

2016

2017

Jun 26

Suzhou, China

manufacturing facility

closure announced

Jan 31

Kirkland, Ontario

manufacturing

facility closure;

Jan 31

Headcount

Headcount

reduction

reduction

2Q18

Dio, Sweden

May 30

Dec 7

Headcount

Headcount

wheelchair

reduction

reduction

production

transfer

completed

2018

4Q18

Headcount reduction

1Q19

Küschall Switzerland wheelchair production transfer completed

2019

Apr 30

Atlanta DC

Closure

Dec

Announced

German

plant

consolidation

2Q19

Headcount reduction

2020

I N V A

Jul 2
		Sep 30
Invacare Rentals
	Garden City Medical
divestiture
	divestiture
Annualized revenue
	Annualized revenue $36.4M
$28.8M at 2015 run
	at 2016 run rate
rate

$39 million in cost optimization actions executed from 2017 to date

Mar 7

Dynamic Controls divestiture Annualized revenue $17.2M at 2019 run rate

Invacare Presentation - Piper Sandler Conference: December 2, 2020

O N

Innovation Pipeline

Supporting sales growth with frequent introduction of clinically innovative solutions

Aug

Invacare® TDX® SP2 w/

LiNX® technology

Rehab (Mobility and Seating)

Post Acute Care (Lifestyle)

A R E C O R P O R A T I

Rovi® X3 with gyro

and high-speed

motors

Top End® EliminatorTM

Feb

Invacare® Top End®

NRG Racing Chair

Preliminator racing

wheelchair

May

Cruise Mode

on Alber®

Mar

Invacare®

Twion® power

Sep

Orion

assist device

Invacare®

and Comet

Action® manual

Scooters

wheelchairs

2017

2018

May

E-pilot P15

Power Add

On

May

SMOOV

One™ Power

Add On

2019

Respiratory

				Mar
				AVIVA FX /
				AVIVA RX
			Power
Sep
				Wheelchairs
MPS Maxx
Modular Power
Standing System					Apr
						MPS Mini
						Maxx
						Standing
						System

2020

A C

Jan
Bed	Oct
safety

Sep

Apr

Invacare Stand Assist

Sep

I N V

and			Enhanced
hygiene			Platinum®
products		Mobile®
May
			concentrator
	Outcomes by
	DesignTM	with
	post-acute	Connectivity

solutions

May

Birdie Evo

Lifter

Ocean Ergo

Commode

chairMay Birdie Evo

Xplus Lifter

NordBed

Platinum®

Mobile® concentrator with remote control functionality

Invacare Presentation - Piper Sandler Conference: December 2, 2020

Award Winning Mobility & Seating Products

I N V A C A R E C O R P O R A T I O N

MPS Maxx Modular Power

Standing System and Mini Maxx

• Innovative center-wheel drive powerchair with clinical and social benefits of vertical positioning
• Fits fully within Group 3 reimbursement in the U.S.

AVIVA FX (U.S.) and

AVIVA RX (Europe)

• Advanced seating and positioning systems
• Unique suspension systems resulting in a smooth stable ride
• Standing capabilities on FWD platform

Smoov one™

Power Assist

• Easy mounting to manual wheelchairs
• Small, lightweight, easy to travel with
• 6.2 mph top speed, 12.4 mile range and supports up to 309 lbs.
• Ergonomic user interface
• Connectivity app

Invacare Presentation - Piper Sandler Conference: December 2, 2020

Innovative Lifestyles Products

For home healthcare and long-term care settings

I N V A C A R E C O R P O R A T I O N

Invacare Presentation - Piper Sandler Conference: December 2, 2020

I N V A C A R E C O R P O R A T I O N

Full Year 2020 Guidance

As reported on October 30, 2020

Based on continuing access to healthcare facilities without new public health restrictions, and adoption of new products, the company now anticipates the following:

Full Year 2020 Guidance:

• Reported net sales of at least $840 million, up from the previous range of $810 to $840 million;
• Adjusted EBITDA in the range of $28 to $32 million, up from the previous range of $27 to $30 million; and,
• Free cash flow usage in the range of $8 to $12 million, changed from the previous range of usage of $7 to $10 million.

4Q20 Assumptions

• Consolidated net sales to improve sequentially and lower than 4Q19
• • Europe to recover slowly and below 4Q19 in the mid-teens
  • North America to be below 4Q19 in the low single-digits
• Selling expenses to increase sequentially to support higher sales
• Free cash flow impacted by timing of cash collections from higher sequential sales

$35

$30

$25

$20

$15

$10

$5

$0

$4

($6)

($16)

($26)

($36)

($46) ($56)

Full Year Adjusted EBITDA

(in millions)

$28 - $32

$28.7

$6.6

201820192020 Est

Full Year Free Cash Flow

(in millions)

201820192020 Est

($8.1)

($8) - ($12)

($52.7)

Invacare Presentation - Piper Sandler Conference: December 2, 2020

I N V A C A R E C O R P O R A T I O N

Transformation Highlights

We are transforming to regain market leadership

	We have a clear roadmap to further enhance
Key	and simplify our operations

Takeaways

We have a strong pipeline of innovative products coming to market

Our financial performance is improving as a result of these initiatives

Invacare Presentation - Piper Sandler Conference: December 2, 2020