EX-99.1 2 dex991.htm CL KING 8TH ANNUAL BEST IDEAS CONFERENCE 2010 PRESENTATION CL King 8th Annual Best Ideas Conference 2010 Presentation
CL King’s 8
th
Annual Best Ideas Conference
September 15, 2010
Exhibit 99.1


Disclosure
1
Forward-Looking
Statements:
This
presentation
includes
“forward-looking
statements”
within
the
meaning
of
the
Private
Securities Litigation
Reform
Act
of
1995.
The
use
of
words
such
as
“may”,
“might”,
“should”,
“will”,
“expect”,
“plan”,
“anticipate”,
“believe”, “estimate”,
“project”,
“forecast”,
“outlook”,
“intend”,
“future”,
“potential”
or
“continue”,
and
other
similar
expressions
are
intended to identify
forward-looking
statements.
All
of
these
forward-looking
statements
are
based
on
estimates
and
assumptions
by
our management
as
of
the
date
of
this
presentation
that,
although
we
believe
to
be
reasonable,
are
inherently
uncertain.
Forward-looking statements
involve
risks
and
uncertainties
that
could
cause
the
Company’s
actual
results
or
circumstances
to
differ
materially from those
expressed
or
implied
by
forward-looking
statements.
These
risks
and
uncertainties
include,
among
others,
the
following: the cyclicality
of
the
markets
that
the
Company
serves
and
the
vulnerability
of
those
markets
to
economic
downturns;
the
negative impacts of
the
recent
global
economic
and
financial
crisis;
a
delay,
significant
reduction
in
or
loss
of
purchases
by
large
customers;
fluctuations in
energy
prices;
competition;
our
reliance
on
key
suppliers
and
potential
supplier
failures
or
defects;
the
modification
or
cancellation
of orders
in
our
backlog;
the
impact
of
the
financial
distress
of
third
parties;
changes
in
government
energy
policy
and
healthcare regulations
and
reimbursement
policies;
general
economic,
political,
business
and
market
risks
associated
with
the
Company's
global operations;
fluctuations
in
foreign
currency
exchange
and
interest
rates;
potential
future
charges
to
income
associated
with
potential impairment
of
the
Company’s
significant
goodwill
and
other
intangibles;
the
Company's
ability
to
successfully
manage
its
costs, core business
resources
and
growth,
including
its
ability
to
successfully
acquire
and
integrate
new
product
lines
or
businesses
and
manage operational
expansions;
the
loss
of
key
employees
and
deterioration
of
labor
and
employee
relations;
the
pricing
and
availability
of raw materials;
the
Company's
ability
to
manage
its
fixed-price
contract
exposure;
the
regulation
of
our
products
by
the
U.S.
Food
&
Drug Administration
and
other
governmental
authorities;
additional
liabilities
related
to
taxes;
the
costs
of
compliance
with
environmental,
health
and
safety
laws,
and
potential
liabilities
under
these
laws;
the
impact
of
hurricanes
and
other
severe
weather;
litigation
and disputes
involving
the
Company,
including
product
liability,
contract,
warranty,
pension,
intellectual
property
and
employment
claims; volatility
and
fluctuation
in
the
price
of
the
Company’s
stock;
and
risks
associated
with
our
indebtedness.
For
a
discussion
of
these
and additional
risks
that
could
cause
actual
results
to
differ
from
those
described
in
the
forward-looking
statements,
see
disclosure
under Item
1A.
“Risk
Factors”
in
the
Company’s
most
recent
Annual
Report
on
Form
10-K
and
other
recent
filings
with
the
Securities
and Exchange
Commission,
which
should
be
reviewed
carefully.
Please
consider
the
Company’s
forward-looking
statements
in
light
of these
risks.
Any
forward-looking
statement
speaks
only
as
of
its
date.
We
undertake
no
obligation
to
publicly
update
or
revise
any forward-looking
statement,
whether
as
a
result
of
new
information,
future
events
or
otherwise,
except
as
required
by
law.


Agenda
2
Company Overview
Financial Highlights
Segment Overview
Industry Trends
Growth Initiatives
Manufacturing and Distribution
Investment Highlights Summary


3
Technology
leader
-
Energy
industry
is
the
largest
end-user
of
Chart
products
Leading
position
-
#1
or
#2
in
all
primary
markets
served
Global
footprint
-
operations
on
four
continents
and
about
2,700
employees
Worldwide
earnings
about
60%
of
2009
sales
derived
from
outside
United
States
Company Overview
Chart Industries is a leading provider of highly engineered cryogenic
equipment for the hydrocarbon, industrial gas, and biomedical markets.
Asia
23%
U.S.
41%
Americas
(Non-US)
6%
RoW
12%
Europe
18%
2009 Sales by Segment
Energy
63%
BioMedical
15%
General
Industrial
22%
2009 Sales by Region
2009 Sales by End-User
Energy &
Chemicals
43%
Distribution
& Storage
42%
BioMedical
15%


Strong Track Record of Successful Execution
4
Drivers of Growth
Operational Excellence
Flexible cost structure allowed for aggressive
response to economic downturn
Lean initiatives continue to drive favorable
earnings and cash generation
Energy & Chemicals
Significant exposure to expected global energy
demand growth
Environmental legislation and alternative
energy opportunities
Distribution & Storage
Expanding aftermarket business
Global relationships with major industrial gas
companies
Alternative fuel opportunities with LNG
BioMedical
Liquid oxygen growth in emerging markets
Increasing biological research expenditures
Aging demographic
CAGR
(2004-2009)
Sales   14%
Oper. Inc.  21%
(1)    Included in 2005 are non-recurring costs of $26.5 million for the acquisition of Chart Industries
by First Reserve.
(1)
0
20
40
60
80
100
120
140
160
0
100
200
300
400
500
600
700
800
2004
2005
2006
2007
2008
2009
Sales
Operating Income


Energy & Chemicals (E&C) Segment Overview
5
Heat Exchanger
Cold Box
Production
Heat
Exchangers
68%
Cold Boxes and
LNG VIP
32%
2009 Sales by Product/Region
Highlights
Technology
leader
-
providing
heat
exchangers
and
cold
boxes critical to LNG, Olefin petrochemicals and natural gas
processing markets
Separation, liquefaction and purification of hydrocarbon and
industrial gases
Market
leader
-
leading
market
positions
worldwide
Manufacturing
leader
-
one
of
three
global
suppliers
of
mission-critical LNG and LNG liquefaction equipment
Selected Products
Americas
(Non-US)
5%
RoW
20%
Asia
38%
U.S.
36%
Europe
1%


Distribution & Storage (D&S) Segment Overview
6
2009 Sales by Product/Region
Highlights
Balanced
customer
base
-
46%of
2009
segment
sales
derived from products used in energy applications
Strategic
footprint
manufacturing
located
near
growing
end
markets and lower-cost countries
Positioned to capitalize on strong expected growth in Asia and
Eastern Europe
Continued investment in key global manufacturing facilities
Bulk
MicroBulk
Distribution
Storage
Selected Products
Satellite
LNG Storage
Bulk Storage
Systems
46%
Packaged Gas
Systems
22%
VIP, Systems
and Components
6%
Parts, Repair and On-
Site Service
11%
Beverage Liquid
CO2 Systems
8%
LNG Terminals
and Vehicle Fuel
Systems 7%
Americas
(Non-US)
7%
RoW
5%
Asia
13%
U.S.
49%
Europe
26%


BioMedical
Segment Overview
7
2009 Sales by Product/Region
Highlights
Strong
growth
increases
in
oxygen
respiratory
therapy
and
biomedical research, led by international markets, expected
Robust end markets include:
Home healthcare and nursing home
Hospitals and long-term care
Biomedical and pharmaceutical research
Animal breeding
Portable Oxygen
Lab Storage
Stainless Steel Freezer
End-Use Consumption
Respiratory
Therapy
Systems
46%
Other
5%
Biological
Storage
Systems
49%
Selected Products
Americas
(Non-US)
9%
U.S.  
34%
Europe
47%
Asia
10%


8
Growing
industry
-
Energy
demand
recently
forecasted
to
expand
40%
between
now
and
2030
with
global
investment
of
$26 trillion, over $1 trillion/year, needed to keep up with demand*
Natural
Gas
expansion
-
World
primary
demand
for
natural
gas
expands
on
average
by
1.5%
per
year.
The
biggest
increases occur in the Middle East, China and India.  New power generation stations absorb 45% of the increase. *
LNG
growth
leader
-
“Global
gas
demand
is
likely
to
rise
by
25%,
while
the
use
of
LNG
is
set
to
surge
by
40%
by
2020.”
Source:
ExxonMobil
quoted
at
CWC
World
LNG
Summit,
Barcelona
-
(12/2/2009)
China
LNG
growth
-
“China’s
LNG
demand
forecast
for
2020
raised
by
48%.”
Source:
Wood
Mackenzie
Consultants
Ltd.
(7/26/2010)
* Source:
International
Energy
Agency
World
Energy
Outlook
2009, Reference Scenario
Reference Scenario based on assumption that governments do
not change their policies relating to energy; differences would
arise should governments change energy policies
Energy Trends
World Primary Energy Demand by Fuel*


9
Natural
Gas
penetration
-
increasing
as
a
transportation
fuel
due
to
its
high
energy
density,
lower
costs, and low emissions
Broad
product
offering
-
Chart
provides
products
/
solutions
for
the
full
LNG
value
chain
from
LNG
terminal equipment / liquefiers to on-board fuel tanks
Favorable environment to substantially grow Chart’s existing LNG business with potential new
opportunities in marine and industrial applications
Energy Bill currently before Congress could significantly boost natural gas vehicle (NGV)
adoption in U.S., driving a multi-year build-out of LNG production, storage and distribution
infrastructure and creating additional market opportunities for Chart
China has already begun investing in substantial NGV fueling infrastructure resulting in
recent order activity
Energy Trends


Growth Initiatives
10
Current economic environment continues to provide acquisition opportunities for Chart
with its strong balance sheet and more than adequate liquidity
Chart’s acquisition criteria
Niche
Position
-
global
niche
engineered
equipment,
systems
or
aftermarket
business
Technology/Product
fit
complementing
Chart’s
core
competencies
Market
Leader
-
#1
or
potential
to
become
#1
within
existing
or
adjacent
growth
markets
Geographic
Expansion
or
Consolidation
leverages
Chart’s
global
footprint
or
cost
savings
synergies
Growing all business segments
Completed five acquisitions in two years
E&C
Tri-Thermal
(2009)
D&S
Flow
Instruments
(2008),
Cryotech
International
(2010)
BioMedical
Golden
Phoenix
(2009),
Covidien
(2009)


Global Manufacturing and Distribution Platform
11
Operating
leverage
provides
the
flexibility
to
expand
and
reduce
capacity
as needed with minimal capital expenditures
Manufacturing facilities are strategically located in lower-cost countries and
near centers of demand
Corporate
Energy & Chemicals
Distribution & Storage
BioMedical
Total:
Manufacturing:
Europe
Asia-Pacific
14
9
6
2
4
2
North America


Summary of Investment Highlights
Flexible Manufacturing Platform
Ability to ramp up or scale back production as demand fluctuates
Necessary capacity expansion/contraction is easily attainable
Proven ability to implement cost-savings measures during periods of sharp decline
Very strong balance sheet
Significant improvement in net debt position
Substantial free cash flow growth and liquidity
Stable business model
Attractive industry with long-term customer relationships
Solid platform with worldwide presence and leading market positions in all segments
Continued growth initiatives
Expect continued strategic, accretive acquisition activity
New product development taking advantage of leading proprietary technology and designs
Positioned for continued significant growth as markets recover
Strong track record of maximizing operating efficiencies and growth
Leading market position in all business segments
12
Chart represents a unique investment opportunity to capitalize on the return
of strong growth in the markets it serves