Franklin Electric (FELE) Baird 2025 Global Industrial Conference presentation summary

Company overview and strategy

• Focuses on flow control for water and energy, leveraging innovation and a strong global presence in over 20 countries with $2B in 2024 sales and 7,000 employees.

• Strategic priorities include serving critical water and energy needs, accelerating growth through innovation, and enhancing customer and employee experiences.

• Operates in three main segments: Water Systems, Distribution, and Energy Systems, with a value creation framework centered on growth, resilient margins, capital investment, and talent.

• Maintains a leading market position in groundwater pumping, with a history of consistent organic growth and capital returns to shareholders.

• Pursues both organic and inorganic growth through product development, acquisitions, and geographic expansion.

Market trends and growth drivers

• Benefits from secular trends such as urbanization, water scarcity, energy efficiency, and digital transformation across residential, commercial, industrial, and agricultural markets.

• End-market revenue is diversified, with significant exposure to residential (45%), commercial/industrial (20%), agriculture (13%), and energy (13%).

• Geographic revenue is primarily from the U.S./Canada (74%), with additional presence in EMEA, Latin America, and APAC.

• Water Systems segment capitalizes on urbanization, computing power growth, and mineral demand, offering premium products and services.

• Energy Systems focuses on fuel handling and grid monitoring, emphasizing safety, innovation, and environmental protection.

Financial performance and capital allocation

• 2024 consolidated sales reached $2.021B, with a 16% CAGR in net revenue from 2020–2024.

• EPS for 2024 was $3.25, with a 2020–2024 CAGR of 13%.

• Free cash flow for 2024 was $189M, with a conversion rate of 122% and ROIC at 16.0%.

• Maintains a strong balance sheet with net debt to EBITDA at 0.4x as of June 2025.

• History of returning capital to shareholders, with dividends paid CAGR of 12% since 1993.