Ralliant (RAL) Investor Day 2025 summary

Strategic vision, direction, and company evolution

• Preparing to operate as a standalone public company after separation from Fortive on June 28, 2025, establishing an independent precision technologies leader with tailored growth models and capital allocation strategies.

• Strategic focus since 2019 has led to divestitures, increased profitability, and a sharpened emphasis on core precision capabilities, innovation, and operational efficiency.

• Portfolio reshaped around test & measurement, sensors, and safety systems, with a focus on secular growth drivers and expansion in a $16 billion serviceable addressable market.

• Ralliant Business System (RBS) deployed company-wide to drive operational rigor, continuous improvement, and execution.

• Recent acquisition of EA Elektroautomatik expands test & measurement capabilities and innovation platform.

Financial performance and guidance

• Achieved $2.2B revenue in 2024, with 3.5% revenue CAGR and 25.7% adjusted EBITDA margin from 2019–2024, and EBITDA margins expanding by almost 600 basis points.

• Generated approximately $2 billion in free cash flow over five years, with a durable conversion rate above 95% and FCF margin of ~20%.

• Targeting 3–5% annual revenue growth through the cycle, with Adjusted EBITDA expected to grow faster than revenue.

• Projecting over $1 billion in cumulative free cash flow by 2028, maintaining a strong balance sheet and net leverage of 1.9x at spin.

• Capital allocation priorities include organic reinvestment, shareholder returns (dividends, buybacks), and disciplined M&A.

Growth vectors, segment strategies, and business development

• Three primary growth vectors: grid modernization, defense technologies, and power electronics, with platform-driven innovation doubling new product introductions.

• Test & Measurement: Accelerating margin recovery and expansion in power electronics.

• Sensors & Safety Systems: Growth in defense technologies and grid modernization, leveraging stronghold positions.

• Utilities: Positioned for above-market growth via grid modernization, data center expansion, and renewables.

• Defense: Embedded in over 50 long-term programs, driving innovation for defense modernization and space advancements.