emerson investor day presentation

EMERSON ANNOUNCES PREMIUM, ALL-CASH PROPOSAL TO ACQUIRE NATIONAL INSTRUMENTS FOR $53 PER SHARE

News provided by

Jan 17, 2023, 06:55 ET

Share this article

Proposal Represents Immediate, Compelling Cash Premium of 32% Over NI's Closing Share Price on January 12, 2023

Offers Deal Certainty for NI Shareholders – No Financing Contingency, No Anticipated Regulatory Concerns

Public Proposal Follows Numerous Attempts to Engage with NI in Private over Last Eight Months, Leading Up to NI's Public Announcement of Strategic Review

NI's Test and Measurement Technology Fully Aligned with Emerson's Strategy to Develop a Cohesive, Higher Growth and Higher Margin Portfolio and Advance Global Automation Focus

Emerson to Host Conference Call to Discuss Proposal Today at 8:30 a.m. Eastern Time

ST. LOUIS , Jan. 17, 2023 /PRNewswire/ -- Emerson (NYSE: EMR ) today announced that it submitted a proposal to the Board of Directors of National Instruments ("NI") (NASDAQ: NATI ) to acquire NI for $53 per share in cash at an implied enterprise value of $7.6 billion .

The proposal, which is not subject to any financing conditions, was submitted to NI on November 3, 2022 , and represents an improvement over an initial $48 per share proposal submitted on May 25, 2022 . Emerson has made numerous attempts to engage constructively with NI in private since May 16, 2022 , as outlined in the correspondence below. Full details, including Emerson's previous correspondence with NI, are available at www.MaximizingValueAtNI.com .

The proposal represents:

• Immediate and certain cash value for all NI shareholders;
• A 32% premium to NI's closing share price as of January 12, 2023 , the day prior to NI's public announcement of a strategic review on January 13, 2023 ;
• A 45% premium to NI's closing share price as of November 3, 2022 , the day Emerson submitted its latest proposal to acquire NI;
• A 38% premium to the volume weighted average price for the last 30 trading days ending January 12, 2023 ; and
• A 23% premium to NI's 52-week high intra-day share price of $43.12 , as of January 12, 2023 .

"Although Emerson would have preferred to reach an agreement privately, given NI's announcement that it is undertaking a strategic review, and after refusing to work with us toward a premium cash transaction over the past eight months, we are making our interest public for the benefit of all NI shareholders," said Lal Karsanbhai, President and Chief Executive Officer of Emerson. "Acquiring NI is another step forward in Emerson's journey to develop a cohesive, higher growth and higher margin portfolio and build on its global automation focus. As Emerson outlined at our recent Investor Conference, we are transforming our portfolio toward higher-growth automation markets aligned with secular macro trends, which will deliver significant growth and profitability for years to come."

Mr. Karsanbhai continued, "We have long admired NI and believe that combining its best-in-class electronic test and measurement product and software offerings with Emerson's industry-leading automation technology and software would enhance our ability to bring comprehensive solutions to a diverse set of end markets, accelerating growth and positioning Emerson to create significant shareholder value. We stand ready to work immediately with NI's Board and management team to reach an agreement that would provide a compelling premium and certain cash value today for all NI shareholders."

Combination Would Advance Emerson's Global Automation Focus

The proposed transaction continues Emerson's transformation into a global automation company. Benefits of the transaction include:

• Aligned with Emerson's Portfolio Transformation Into a Cohesive, Higher Growth, and More Profitable Company:  Emerson is actively transforming its portfolio to create a higher value, cohesive industrial technology portfolio serving a diversified set of end markets. With NI, Emerson would gain a strong, complementary portfolio of differentiated electronic test and measurement offerings, and a technology stack of industry-leading intelligent devices, controls and software that complements Emerson's technology stack in its core automation markets. As outlined at Emerson's November 29, 2022 Investor Conference, test and measurement is one of Emerson's four priority segments.
• Further Diversification of End Markets: With favorable long-term trends and an estimated priority target TAM of $35 billion , test and measurement is a fast-growing and complementary adjacency to Emerson's portfolio. This acquisition would enable Emerson to further expand and diversify its customer base within highly attractive end markets with strong secular trends including semiconductor, automotive and electric vehicles, and aerospace and defense.
• Significant Financial Benefits: The transaction is expected to be accretive to Emerson's adjusted EPS in the first year, meets Emerson's communicated returns threshold and will improve Emerson's overall growth. NI has an attractive financial profile, with approximately 70% gross margins. NI's business has strong positions in attractive and growing markets, creating sustainable top line growth potential. Emerson sees significant potential for profit and cash flow improvement across the NI business by applying proven operational excellence and productivity levers through Emerson's Management System.
• Emerson's Strong Commitment to the Transaction: Emerson believes its premium proposal will bring clear and realizable value to NI shareholders, who have faced years of share price underperformance across nearly any period. Underscoring its commitment to consummating a transaction, Emerson has purchased 2.3 million shares of NI stock and has received approval under HSR 1 to increase its stake. Emerson believes that there is a path to a friendly transaction and urges NI shareholders to make their views known to NI's management and Board. Furthermore, Emerson is prepared to nominate directors for election to NI's Board.

Emerson's Public Proposal Follows Eight Months of Delay and Lack of Engagement

Emerson's first outreach to NI regarding a potential all-cash acquisition was on May 16, 2022 , and Emerson's initial $48 per share proposal was formalized in a letter on May 25, 2022 . For eight months, NI delayed and refused to engage meaningfully with Emerson, as outlined in the correspondence below. In addition, after receiving the initial May 25, 2022 proposal from Emerson, NI not only refused to engage with Emerson – it repurchased more than 2 million shares at an average weighted price of $40.25 , the largest quarterly repurchase in its history on a dollar basis, depriving its shareholders of the opportunity to realize immediate cash value through the transaction price, which is significantly above the repurchase price.

In a November 3, 2022 letter, Emerson outlined the terms of an improved all-cash proposal of $53 per share and highlighted its numerous attempts to engage with NI to that date. On November 15, 2022 , NI responded to Emerson, indicating that it had created a working group of its Board to examine Emerson's proposal in greater detail, as well as evaluate options with the assistance of advisors.

In the more than two months since, NI continued to resist engaging meaningfully with Emerson to work toward an agreement. Eight months after Emerson's approach, NI agreed to a January 4, 2023 meeting with representatives from Emerson, which was followed by one additional conference call. During these discussions, NI shared very limited, high-level information about its business and continued to demonstrate its unwillingness to provide more detailed information, including refusing to respond to key diligence questions provided ahead of the meeting. NI then informed Emerson that this would be the extent of its engagement. In a letter dated January 11, 2023 , Emerson reiterated its $53 per share proposal to acquire NI.

NI Shareholders: Stop Your Board's Delay Tactics

Emerson is disappointed that NI chose to announce a strategic review and put in place a poison pill on January 13, 2023 , rather than engaging privately and constructively. NI did not respond to Emerson's latest letter sent on January 11 before its public announcement.

NI's strategic review announcement comes more than two months after the NI Board purportedly formed a working group to evaluate options with its advisors – with no results.

NI shareholders should understand that for eight months they have been deprived of the opportunity to realize certain cash value at a significant premium. Emerson urges NI shareholders to engage with their Board to ensure this public strategic review process is not merely another delay tactic.

Emerson has organized the resources to work expeditiously toward a transaction with NI, has shared a merger agreement with NI, and is prepared to transact promptly. Emerson has performed due diligence with publicly available information and would have only limited and specific confirmatory due diligence requirements. Additionally, Emerson does not anticipate any significant regulatory risks or delays given the complementary nature of the two businesses. Finally, the Emerson proposal is not subject to any financing conditions.

Emerson feels compelled to disclose the contents of all its correspondence with NI, beginning in May 2022 , to make public its consistent and sustained track record of attempted engagement with NI, without any meaningful or constructive response. This correspondence is below and is also available at www.MaximizingValueAtNI.com .

Investor Conference Call and Presentation

Today, beginning at 7:30 a.m. Central Time / 8:30 a.m. Eastern Time , Emerson management will discuss the proposal during an investor conference call. Participants can access a live webcast available at www.Emerson.com/en-us/investors at the time of the call. A replay of the call will be available for 90 days on the company website and at www.MaximizingValueAtNI.com . Conference call slides will be posted in advance of the call on the company website and at www.MaximizingValueAtNI.com .

Goldman Sachs & Co. LLC and Centerview Partners LLC are serving as financial advisors to Emerson and Davis Polk & Wardwell LLP and Sidley Austin LLP are serving as legal advisors.

Emerson's Correspondence with NI

May 25, 2022 – Emerson's First Offer Letter to NI

Eric Starkloff President and Chief Executive Officer National Instruments Corporation 11500 N Mopac Expwy Austin, TX 78759-3504

Further to my recent discussions with you, I am excited to present you with this proposal (the "Proposal") for the acquisition of all outstanding shares of National Instruments Corporation ("NI") by Emerson Electric Co. ("Emerson").

We are very excited about the combination of our two firms and the potential we can achieve together. Emerson has long admired NI as a technology leader in the electronic test and measurement industry, a complementary adjacency to our Automation Solutions business with a similar technology stack of intelligent devices, controls, and software. We have been particularly impressed with NI's portfolio including modular intelligent devices and the LabVIEW suite of offerings, as well as NI's industry stewardship over many decades in this space. Combining NI with Emerson would lead to significant opportunities for both of our teams and further develop our position as a premier global automation company.

In addition to the immediate value created for your shareholders as outlined in the Proposal, Emerson has demonstrated long term stewardship and investment in acquired businesses over many decades. Our industry leading Automation Solutions platform was built through a combination of sustained organic investments as well as strategic acquisitions of highly innovative businesses including Rosemount, Micro Motion, Fisher, and most recently our acquisition of majority control in AspenTech. All of these businesses have thrived under Emerson ownership and are leaders in their respective markets. With the potential acquisition of NI, we are looking to continue our long history of stewardship and commitment to growth, development, and engineering leadership.

With that backdrop, I am pleased to present you and your Board with this Proposal:

Emerson proposes to purchase 100% of the outstanding common stock of NI for $48 in cash per common share, which implies an equity value of $6.49 billion and an enterprise value of $6.67 billion . We believe our Proposal provides significant value to your shareholders:

• A 39% premium to NI's closing share price as of May 24, 2022 ;
• A 36% premium to the volume weighted average price for the last 30 trading days ending May 24, 2022 ;
• A 4% premium to the 52 week high trading price as of May 24, 2022

Our Proposal is not subject to any financing condition and would be financed from cash on hand, committed lines of credit and/or other available sources of financing.

While applicable regulatory approvals will be required, we do not expect there to be substantive impediments to closing. We note the complementary nature of our respective businesses.

Due Diligence

This Proposal is based on publicly available information under the assumption that it presents fairly and completely NI and its businesses and its outstanding debt and share count. It is subject to the completion of customary and confirmatory due diligence (e.g., tax, environmental, legal, etc.). We are prepared to move quickly to complete such due diligence when appropriate.

Emerson is prepared to proceed immediately to work with NI and its advisors to complete due diligence and to negotiate a mutually agreeable merger agreement (the "Definitive Agreement") in parallel. It is our expectation that the signing of the Definitive Agreement and announcement can be achieved in 4-6 weeks.

We have no current plan to disclose this letter and assume that you do not intend to either. Our strong preference is to work constructively and expeditiously with you and your board to announce a Definitive Agreement.

Board Review

This Proposal has been reviewed with Emerson's board of directors who support the proposed transaction. The final approval of Emerson's board of directors would be required prior to entering into the Definitive Agreement.

The Definitive Agreement would be negotiated and executed by Emerson and NI and closing would be conditioned upon required NI shareholder approval, required regulatory approvals and other customary conditions. Emerson shareholder approval will not be required.

To reiterate, our Proposal – all cash consideration with no financing contingency and no substantive regulatory impediments – provides both significant value and certainty to NI's shareholders. We are prepared to move very quickly to complete our due diligence and sign definitive agreements.

We are highly enthusiastic about the prospects of what we can achieve together. On behalf of Emerson, I thank you again for the dialogue thus far and for your consideration of this Proposal. We look forward to hearing from you.

Lal Karsanbhai President and Chief Executive Officer

June 16, 2022 – NI's Response to May 25 Letter

Lal Karsanbhai President and Chief Executive Officer Emerson Electric Co. 8000 West Florissant Avenue PO Box 4100 St. Louis, MO 63136-8506

The Board of Directors (the "Board") of National Instruments Corporation ("NI") has carefully reviewed your letter dated May 25, 2022 , with the assistance of our financial and legal advisors.

The Board has unanimously determined that your letter does not provide a basis for further discussions.

NI's Board and management team will remain focused, without distraction, on executing our strategies that are producing a significant and steady increase in bookings and revenue, strengthened operational performance, and advances in technology.

Eric Starkloff President and Chief Executive Officer

Michael E. McGrath Chairman of the Board

June 22, 2022 – Emerson's Second Offer Letter to NI

National Instruments Corporation 11500 N Mopac Expwy Austin, TX 78759-3504

Dear Eric and Michael:

I received your letter dated Thursday, June 16th , responding to our proposal from Wednesday, May 25th (the "Proposal") for the acquisition of all of the outstanding shares of National Instruments Corporation ("NI") by Emerson Electric Co. ("Emerson"). I am disappointed in your response and the lack of engagement from you and your Board to what is an extremely attractive Proposal for the shareholders of NI.

We have followed NI for many years and believe that the Proposal is a unique opportunity for NI shareholders to realize a certain cash value and to accelerate the execution of your vision to automate test across the product lifecycle. We are offering an immediate financial benefit to your shareholders, and a high-quality home for NI, benefiting your employees, customers, suppliers and communities.

Our Proposal to acquire all of NI's outstanding shares at $48 per share in cash offers significant value to your shareholders measured against both short and longer-term metrics, specifically a:

• 51% premium to NI's closing share price as of June 21, 2022 ;
• 41% premium to the volume weighted average price for the last 30 trading days ending June 21, 2022 ;
• 39% premium to NI's closing share price as of May 24, 2022 (the day prior to when we made the Proposal); and
• 4% premium to the 52 week high trading price as of June 21, 2022 .

We are highly confident your shareholders would view our cash offer favorably and recent market data points reinforce this view, including:

• The last time NI's share price closed above $48 was on December 6th, 2018 . NI's share price has underperformed both the broader market and its key peer, Keysight, since then, with the stock down 34% in a period where the NASDAQ Index gained 54% and Keysight gained 125%;
• Four of the six brokers who cover NI have reduced their 12 month forward price targets following your Q1 earnings with the median price target being reduced from $50 to $43.50 ; and
• The top 10 active shareholders as of the end of Q1 2021 owned approximately 19% of the company with an estimated weighted average cost basis of $35 . Over the past year, 8 of those 10 shareholders have reduced their positions and sold stock materially below the price we are offering.

We prefer to engage in collaborative, bilateral discussions with minimal distraction to your management team to reach an agreement privately. Your letter referenced "significant and steady increases in bookings and revenue" as well as "strengthened operational performance and advances in technology". We look forward to learning more about your internal plan and are confident that with access to limited non-public information after signing an NDA, we could work with you to find additional value that would allow us to increase our Proposal.

We are prepared to engage immediately and have organized the resources to move towards a transaction expeditiously, including:

• Diligence:  We have performed extensive outside-in due diligence on NI over an extended period. As a result, we have limited and specific confirmatory due diligence requirements.
• Timing:  We are ready to begin our confirmatory due diligence exercise and we would work towards signing and announcing a definitive agreement within four weeks.
• Regulatory:  We do not anticipate any significant regulatory risks or delays given the complementary nature of our businesses.
• Financing:  Our Proposal is not subject to any financing condition and would be financed from cash on hand, committed lines of credit and/or other available sources of financing. Emerson is an A2/A rated company with a strong balance sheet. We have obtained a Highly Confident Letter from Goldman Sachs.
• Advisors:  We have engaged Goldman Sachs & Co. LLC and Centerview Partners LLC as our financial advisors and Davis Polk Wardwell LLC as our legal counsel.
• Certainty:  Our Board of Directors has reviewed and supports the proposed transaction. Emerson shareholder approval will not be required.

Emerson considers this Proposal to be of the highest strategic priority. We are very motivated to conclude a transaction that benefits both companies as well as our respective shareholders. Please confirm receipt of this letter. Given the upcoming July 4th holiday, we recognize you may not be able to get back to us until the week of July 11th . I look forward to hearing from you by then at the latest.

July 6, 2022 – NI's First Response to June 22 Letter

From: Eric Starkloff Sent: Wednesday, July 6, 2022 To: Lal Karsanbhai Subject: Re: Follow-up to NI letter dated June 16

I hope you had a good 4 th of July weekend. I wanted to let you know that we will be discussing your follow-up letter at our regularly scheduled board meeting at the end of this month. I will be in touch with you after the board meeting to discuss.

Regards, Eric

August 2, 2022 – NI's Second Response to June 22 Letter

Our Board of Directors has carefully reviewed your letter dated June 22, 2022 , with the assistance of our financial and legal advisors. The Board remains unanimously of the view that your proposal is not in the best interests of NI and its shareholders.

Eric Starkloff President and Chief Executive Officer

Michael E. McGrath Chairman of the Board

November 3, 2022 – Emerson's Third Offer Letter to NI

I am writing to follow up on your August 2nd response to our June 22nd letter which reiterated our proposal for the acquisition of all of the outstanding shares of National Instruments Corporation ("NI") by Emerson Electric Co. ("Emerson"). After receiving your terse response and continued refusal to engage with Emerson for the benefit of NI's shareholders, we decided to wait to see if your revised guidance, investor day communication, and Q3 results might fundamentally alter investors' views of NI's value or signal an acceleration in NI's outlook that we could incorporate into our thinking before reaching out to you again.

Recap of Events of the Past Six Months

Over a period starting almost 6 months ago, we have consistently been prepared to provide your shareholders an all-cash offer at a meaningful premium, which your Board has repeatedly rebuffed and refused to provide even limited financial information. Given the time that has elapsed, we believe the context of our outreach, your Board's refusal to engage, and NI's investor communications since receiving our first offer are important to summarize:

• May 16th :  My initial outreach to you was premised on meeting in person to introduce myself and shape a compelling all-cash offer for your shareholders. I was surprised that you would not meet with me and instead offered a phone call.
• May 22nd :  In an extremely brief phone call, you reiterated you would not engage and suggested we send a letter if Emerson should want to acquire NI.
• May 25th :  I sent you a letter describing our all-cash offer at a significant premium to NI's current and historical trading levels. The offer was based on public information and outlined key terms related to deal certainty, including no financing contingency.
• June 16th :  You sent a very short response letter refusing to engage, with limited elaboration to your Board's reasons.
• June 22nd :  After your negative response on June 16th , I again attempted to engage with you with a second letter describing our all-cash offer on June 22nd in which I requested access to limited additional information to help find additional value to improve our proposal and asked for a response by July 11th .
• July 6th :  You responded that you could not get back to me by July 11th , and instead would get back to me after your earnings call at the end of the month.
• July 28th Q2 Earnings Call : Despite solid order momentum, NI's performance demonstrated continued challenges to expanding margins, with gross margins down year-over-year by more than 400 bps and only a 2% incremental margin on 14% sales growth. With the knowledge of our approach (that you did not disclose to your shareholders), and despite the headwinds and weak financial performance, you substantially increased your outlook for 2023, guiding to a mid-teens topline growth rate and 300 basis points of margin improvement, a margin improvement three times larger than your prior guidance only three months earlier when you released 1st quarter earnings, at a time when you were not aware of Emerson's interest in acquiring NI.
• August 2nd :  You sent a second, similarly curt response letter refusing to engage.
• August 11th :  You announced you would hold your annual investor day on September 15th .
• September 15th Investor Day:  You reaffirmed the same 2023 guidance as provided with Q2 earnings and provided additional guidance to achieve a further 200 bps operating margin expansion by 2025. Despite your positive tone, your shares fell 3.2% on the day, underperforming the market as investors and analysts continue to doubt NI's ability to execute and deliver these results given its historical track-record and the current operating environment. In particular, the market remains unconvinced about NI's ability to expand EBIT margins through software and system-level solutions as well as the sustainability of order trends and NI's ability to capitalize on secular opportunities in ADAS/EVs/5G.
• October 27th Q3 Earnings:  Despite achieving record quarterly revenue, NI's share price declined 3.0% the next day (a day in which the NASDAQ Index was up 2.9%) given decelerating order rates, as well as continued supply chain challenges and the potential impact of a deteriorating macro. NI's Q4 guidance was below street expectations, despite reaffirming the margin expansion guidance for 2023. Since your announcement, research has highlighted how NI continues to be a "wait and see" company as evidence of margin expansion was pushed out once again. The market is particularly concerned about your ability to achieve your expected growth in the face of a worsening economic outlook in many markets, particularly in your portfolio businesses. Factoring in these uncertainties, almost all brokers revised their estimates for both Q4 and 2023 downwards as well as their target prices

Improved Proposal

From our first outreach, we have preferred to engage with you privately and have been committed to improving our offer to reflect the outlook for your company incorporating the latest financial information. Although we question the motivations for your updated guidance, we do believe in the long-term potential of the NI business under Emerson's leadership and, in the spirit of achieving engagement, we are willing to incorporate your updated outlook to improve our offer. As such, we are increasing our Proposal, from $48 per share to $53 per share (our "Improved Proposal").

Under our Improved Proposal, Emerson proposes to purchase 100% of the outstanding common stock of NI for $53 in cash per common share which implies an equity value of $7.1 billion and an enterprise value of $7.6 billion . Our Improved Proposal delivers compelling all cash value and provides credit for significant future earnings, including your recently updated guidance. Rather than wait for you to achieve an uncertain 2023, our cash offer gives your shareholders immediate credit today. The offer provides substantial premiums to both current and historical metrics, specifically:

• 45% premium to NI's closing share price as of November 3, 2022 ;
• 37% premium to the volume weighted average price for the last 30 trading days ending November 3, 2022 ;
• 53% premium to NI's closing share price as of May 24, 2022 (the day prior to when we made the original Proposal).

For reference, the last time NI's share price closed above $53 was on March 12th, 2018 . Since then, NI's share price has underperformed both the broader market and its key peer, Keysight, with the stock down 31% in a period where the NASDAQ Index gained 36% and NI's closest peer Keysight gained 206%.

Emerson is Prepared to Move Quickly

We believe this Improved Proposal presents the best and most certain path to maximize value for NI shareholders. We are prepared to engage with NI's Board and management team immediately and have organized the resources to work towards a transaction expeditiously.

To emphasize the level of work completed and ability to move with certainty and speed, we reiterate to you our proposed next steps consistent with our prior letters:

• Diligence:  We have performed extensive outside-in due diligence on NI over an extended period. As a result, we have limited and specific confirmatory due diligence requirements only.
• Regulatory: We do not anticipate any significant regulatory risks or delays given the complementary nature of our businesses.
• Advisors:  We have engaged Goldman Sachs & Co. LLC and Centerview Partners LLC as our financial advisors and Davis Polk & Wardwell LLP as our legal counsel. We have also engaged Joele Frank on public relations and Innisfree as our proxy solicitor.

We have invested considerable time and resources and remain fully committed to pursuing this transaction. It is our sincere hope that your Board—having had multiple opportunities to communicate its strategy and outlook to the market with no material change in NI's share price—will view this Improved Proposal favorably and now engage with us in a constructive dialogue. While it is our preference to work with your Board privately and collaboratively towards a potential transaction, another refusal to engage will force us to ensure your shareholders can assess our Improved Proposal directly. In preparation for all options, we would note:

• We have accumulated 2.3 million NI shares in the open market and intend to file for HSR approval to facilitate additional purchases; and
• Given your Board's repeated attempts to move NI's share price higher have been unsuccessful, your remaining defense is neither your operational strategy nor shareholder support for management but rather NI's staggered board. As such, we are prepared to run a slate of directors specifically targeting the two members up for re-election, your Chairman and former CEO, which will provide NI's shareholders with an opportunity to express their views to your Board on its refusal to engage with us.

I continue to be available to meet with you at your convenience and have also instructed our financial and legal advisors to make themselves available to meet with your advisors. Given you have now been in possession of a Proposal from Emerson since May, and now an Improved Proposal, I request that you respond promptly to this letter. I look forward to hearing a more constructive answer and stand ready to engage.

November 15, 2022 – NI's Response to November 3 Letter

We wanted to follow-up on our initial confirmation of receipt of your November 3, 2022 letter. NI and its Board of Directors take your proposal seriously, in accordance with our fiduciary duties. We have established a working group of the Board to examine your proposal in greater detail, as we examine and evaluate options with the assistance of our advisors, inclusive of other prospective purchasers and transaction partners.

November 16, 2022 – Emerson's Response to NI

From: Lal Karsanbhai Sent: Wednesday, November 16, 2022 To: Eric Starkloff ; Michael McGrath Subject: Re: Follow up to NI letter dated August 2nd

Michael and Eric:

I received your letter dated November 15th in response to our November 3rd letter.

We are pleased to hear that you have established a working group of the Board to evaluate our proposal and other strategic alternatives. I would like our respective advisors to speak before Thanksgiving so we can better understand your process and the timeline to evaluate our proposal and other options. Please advise me of the contact details of your advisers and I will have my advisers from Goldman and Centerview reach out to them.

Separately, as mentioned in our November 3rd letter, Emerson will be filing for HSR approval to acquire additional shares of National Instruments Corporation. Attached please find the required notice of such filing and of your company's HSR filing obligation.

November 21, 2022 – NI's Response to Emerson

From: Eric Starkloff Sent: Monday, November 21, 2022 To: Lal Karsanbhai; Michael Mcgrath Subject: Re: Follow up to NI letter dated August 2nd

We received your email on November 16th responding to our letter of November 15th . As previously confirmed to you, NI and its Board of Directors take your proposal seriously, in accordance with our fiduciary duties, and a working group of the Board has been established to examine your proposal in greater detail, as we examine and evaluate options, inclusive of other prospective purchasers and transaction partners.

While it would be premature for our advisors to meet at this time, we will consider a future meeting with representatives from the working group and management after the Thanksgiving holiday.

December 7, 2022 – Emerson's Request to NI for Director and Officer Questionnaire

From: Lal Karsanbhai Sent: Wednesday, December 7, 2022 To: Eric Starkloff Subject: Re: Re: Re: Follow up to NI letter dated August 2 nd

We received your email on November 21st responding to our email of November 16th requesting that our advisors meet before Thanksgiving.  You advised that it would be premature for our advisors to meet at that time. 

You have had our Revised Proposal since November 3rd and over two weeks have passed since your last communication.  In your email, you advised that you had established a working group of the Board, and you would consider a meeting with representatives from the working group and management after the Thanksgiving holiday.  Please provide an update on your process and advise when the advisors can connect, as well as timing for the meeting with the working group and management.

In addition, pursuant to NI's Bylaws, a stockholder proposing to nominate directors for election at the next AGM is required to submit two documents in the form provided by the Company Secretary.  Attached please find a request for both documents and related confirmations for delivery to the Secretary.  As the nomination window opens shortly ( Wednesday, December 28, 2022 ), we would appreciate a timely response and in any case before the deadline stated in the attachment.

December 14, 2022 – Emerson's Section 220 Demand Letter and Follow Up to December 7 Request

From: Sara Bosco Sent: Wednesday, December 14, 2022 To: Eddie Dixon Subject: EMR Demand Letter and Response to NI Letter Dated December 14, 2022

Dear Mr. Dixon,

Attached please find Emerson's demand as a stockholder of National Instruments Corporation ("NI") for inspection of books and records of NI.  Please note the statutorily mandated initial compliance date of Thursday, December 22, 2022 and continuing thereafter through NI's next annual general meeting of its stockholders.  The attached demand provides the contact information for coordinating NI's response through Emerson's outside counsel, Davis Polk .

I also would like to follow-up on my letter dated Wednesday, December 7, 2022 to you requesting documentation mandated by NI's bylaws in connection with the nomination of directors and your letter earlier today.  In your letter you advised that you will provide the documents "shortly" without more specificity.  We are concerned that NI's delay in responding to this straightforward request will frustrate or impair Emerson's ability to nominate directors.  We ask that NI respond fully to the request no later than Sunday, December 18 , 2022.  In that regard, we ask that you provide the supplemental information requested in my December 7 letter in addition to the two documents.

We look forward to prompt and complete responses on all of the above matters.

Sincerely, Sara Yang Bosco

December 14, 2022 – NI's Request for a Call with Emerson

From: Eric Starkloff Sent: Wednesday, December 14, 2022 To: Lal Karsanbhai Subject: Re: Re: Re: Follow up to NI letter dated August 2nd

I'd like to schedule a call with you later this week to discuss next steps and a potential meeting. I can be available Thursday between 11:30 and 2:00 and after 3:30 CST , and Friday any time before noon. Let me know what works for you.

(And regarding the two bylaw documents referred to in your note, my GC Eddie Dixon will be separately replying to your counsel to get that addressed.)

December 14, 2022 – NI's Response to Emerson

Sara Bosco, Esq. Senior Vice President, Secretary and Chief Legal Officer Emerson Electric Co. 8000 West Florissant Avenue PO Box 4100 St. Louis, MO 63136-8506

Dear Ms. Bosco:

This is to confirm that we are in receipt of your request regarding the materials referenced in our bylaws, and that we will provide you with the documents referenced in our bylaws shortly.

R. Eddie Dixon, Jr. Chief Legal Officer, Senior Vice President & Secretary

December 16, 2022 – NI's Email Confirming January 4 Meeting with Emerson

From: Eric Starkloff Sent: Friday, December 16, 2022 To: Lal Karsanbhai Subject: Re: Re: Re: Re: Follow up to NI letter dated August 2nd

Following up on our call yesterday, just to confirm that your suggestion of getting together the first week of January in Austin works for us, and I'm looking forward to seeing you in person.  Does Wednesday, January 4 work for you? If so, we can work to arrange the logistics.  And based on your comments around the areas you are interested in learning more about our business, I think the meeting will be a mutually valuable one.

In preparation for that information sharing, I'll have our lawyers at Wachtell Lipton ( Adam Emmerich , Sabastian Niles and Lina Tetelbaum ) send along a proposed NDA.  Please let me know who they should send it to from your advisor team.  As we discussed yesterday, we are not seeking to prevent you from making board nominations for our next annual meeting, and expect we can get the NDA organized and agreed in short order.

Looking forward to seeing you in January.  Best wishes for a happy holidays. 

January 11, 2023 – Emerson's Fourth Offer Letter to NI

I am writing to follow up on our November 3rd letter which outlined our improved proposal for the acquisition of all of the outstanding shares of National Instruments Corporation ("NI") by Emerson Electric Co. ("Emerson").

We appreciate you and your team hosting us in Austin on January 4th and the one follow-up call between the teams on January 9th . As you have seen through our discussions, we have a deep understanding of the test and measurement sector and specifically NI. While it has been helpful to receive some additional information on your business and plans, the superficial information your team shared has not addressed the 30 focused questions that we provided ahead of time, and as such we are not yet able to change our view on the financial outlook for NI.

Based on what you have shared to date, we reiterate our proposal for Emerson to purchase 100% of the outstanding common stock of NI for $53 in cash per common share. Our offer provides shareholders with credit today for significant future earnings, including your recently updated guidance at attractive premiums:

• 37% premium to NI's closing share price as of January 10, 2023 ; and
• 45% premium to NI's closing share price as of November 3, 2022 (when we increased our proposal to $53 a share).

From our first outreach in May 2022 , we have attempted to work with you privately to see if we could reach a deal and we are highly confident we could announce a deal within days and by no later than your Q4 results on January 31st . To that end, we would be willing to extend the standstill agreement by one week and may see the potential for a very modest increase in value, subject to the following:

• Receiving the outstanding business diligence responses to our prioritized list of 30 questions that we shared on January 6th , as outlined in Annex A;
• Receiving details on all changes in compensation and benefits, equity awards (regular or special) made and anticipated, beyond what has previously been disclosed in NI's SEC filings so we can determine if there are meaningful new costs incurred that may impact our ability to modestly increase our offer;
• Davis Polk will share with Wachtell a draft merger agreement reflective of our proposal and we expect meaningful engagement on negotiating the agreement and aligning on key deal terms;
• Arranging discussions between bankers to agree and align on the process and timeline to announcing a transaction by your Q4 results, and;
• Receiving a full response from your outside counsel to the information requested pursuant to the Section 220 Demand for Stockholder Information which we are entitled to as holders of 2.3 million shares of NI.

We believe our offer is compelling and that there is a path to working with your Board privately and collaboratively towards a potential transaction. We are in a position to move very quickly to finalize customary confirmatory diligence and negotiate the merger agreement, and subject to receiving the information requested, may see the potential for a very modest increase in value. However, if you are not willing to share the information requested, it will require us to reach out to your shareholders directly.

I look forward to hearing from you promptly.

About Emerson

Emerson (NYSE: EMR ) is a global technology and software company providing innovative solutions for the world's essential industries. Through its leading automation portfolio, including its majority stake in AspenTech, Emerson helps hybrid, process and discrete manufacturers optimize operations, protect personnel, reduce emissions and achieve their sustainability goals. For more information, visit  Emerson.com .

Additional Information and Where to Find It

This communication relates to a proposal which Emerson Electric Co. ("Emerson") has made for a business combination transaction with the Company (the "Proposed Transaction"). It is anticipated that Emerson, together with the participants named therein, will file a proxy statement and accompanying WHITE proxy card with the Securities and Exchange Commission ("SEC") to be used to solicit votes for the election of a slate of director nominees identified and nominated by Emerson (the "Nominees") at the 2023 annual meeting of stockholders of National Instruments Corporation, a Delaware corporation (the "Company") and may file other proxy statements and/or other documents.

This communication does not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities or a solicitation of any vote or approval. This communication is not a substitute for any proxy statement or other documents Emerson may file with the SEC in connection with the election of the Nominees or the Proposed Transaction. 

BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY ANY PROXY STATEMENT(S) AND/OR OTHER DOCUMENTS IF AND WHEN THEY ARE FILED BY EMERSON, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, IN CONNECTION WITH THE ELECTION OF THE NOMINEES AND/OR THE PROPOSED TRANSACTION, BECAUSE THESE DOCUMENTS CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE ELECTION OF THE NOMINEES, THE PROPOSED TRANSACTION, AND RELATED MATTERS. Any definitive proxy statement(s) (including any WHITE proxy card enclosed with any definitive proxy statement(s) or supplements filed and/or disseminated by Emerson) (if and when available) will be mailed or otherwise made available to stockholders of the Company . Investors and security holders will be able to obtain free copies of these documents filed with the SEC if and when available without charge through the website maintained by the SEC at www.sec.gov or, in the case of documents filed by Emerson, by contacting the investor relations department of Emerson:

Emerson 8000 West Florissant Avenue, P.O. Box 4100 St. Louis, MO www.emerson.com/en-us/investors

Investor Relations:

Colleen Mettler , Vice President (314) 553-2197 [email protected]

Innisfree M&A Incorporated Scott Winter / Jonathan Salzberger (212) 750-5833

Participants in the Solicitation

Emerson and the Nominees are anticipated to be participants in the solicitation of proxies in connection with the election of the Nominees as directors of the Company.

Information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of proxies in connection with the election of the Nominees as directors of the Company and/or the Proposed Transaction, including a description of their direct or indirect interests in such matters, by security holdings or otherwise, will be set forth in any proxy statement(s) and other relevant materials related to such matters if and when they are filed with the SEC.

Caution Concerning Forward-Looking Statements

This communication contains "forward-looking" statements as that term is defined in Section 27A of the Securities Act and Section 21E of the Exchange Act, as amended by the Private Securities Litigation Reform Act of 1995. All statements, other than historical facts, are forward-looking statements, including: statements regarding the expected timing and structure of the proposed transaction; the ability of the parties to negotiate, enter into and complete the proposed transaction; the expected benefits of the proposed transaction, such as improved operations, enhanced revenues and cash flow, synergies, growth potential, market profile, business plans, expanded portfolio and financial strength; the competitive ability and position of Emerson following completion of the proposed transaction; legal, economic and regulatory conditions; and any assumptions underlying any of the foregoing. Forward-looking statements concern future circumstances and results and other statements that are not historical facts and are sometimes identified by the words "may," "will," "should," "potential," "intend," "expect," "endeavor," "seek," "anticipate," "estimate," "overestimate," "underestimate," "believe," "plan," "could," "would," "project," "predict," "continue," "target" or other similar words or expressions or negatives of these words, but not all forward-looking statements include such identifying words. Forward-looking statements are based upon current plans, estimates and expectations that are subject to risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. We can give no assurance that such plans, estimates or expectations will be achieved and therefore, actual results may differ materially from any plans, estimates or expectations in such forward-looking statements. Important factors that could cause actual results to differ materially from such plans, estimates or expectations include, among others: (1) the outcome of any discussions between Emerson and the Company with respect to the proposed transaction, including the possibility that the parties will not agree to pursue a business combination transaction or that the terms of any such transaction will be materially different from those described herein, (2) that one or more closing conditions to the proposed transaction, including certain regulatory approvals, may not be satisfied or waived, on a timely basis or otherwise, including that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the proposed transaction, may require conditions, limitations or restrictions in connection with such approvals or that any required approval by the stockholders of the Company may not be obtained; (3) the risk that the proposed transaction may not be completed in the time frame expected, or at all; (4) unexpected costs, charges or expenses resulting from the proposed transaction; (5) uncertainty of the expected financial performance of Emerson following completion of the proposed transaction; (6) failure to realize the anticipated benefits of the proposed transaction, including as a result of delay in completing the proposed transaction or integrating the business of the Company with the business of Emerson; (7) the ability of Emerson to implement its business strategy; (8) difficulties and delays in achieving revenue and cost synergies; (9) inability to retain and hire key personnel; (10) the occurrence of any event that could give rise to termination of the proposed transaction; (11) potential litigation in connection with the proposed transaction or other settlements or investigations that may affect the timing or occurrence of the contemplated transaction or result in significant costs of defense, indemnification and liability; (12) evolving legal, regulatory and tax regimes; (13) changes in economic, financial, political and regulatory conditions, in the United States and elsewhere, and other factors that contribute to uncertainty and volatility, natural and man-made disasters, civil unrest, pandemics (e.g., the coronavirus (COVID-19) pandemic (the "COVID-19 pandemic")), geopolitical uncertainty, and conditions that may result from legislative, regulatory, trade and policy changes associated with the current or subsequent U.S. administration; (14) the ability of Emerson and the Company to successfully recover from a disaster or other business continuity problem due to a hurricane, flood, earthquake, terrorist attack, war, pandemic, security breach, cyber-attack, power loss, telecommunications failure or other natural or man-made event, including the ability to function remotely during longterm disruptions such as the COVID-19 pandemic; (15) the impact of public health crises, such as pandemics (including the COVID-19 pandemic) and epidemics and any related company or governmental policies and actions to protect the health and safety of individuals or governmental policies or actions to maintain the functioning of national or global economies and markets, including any quarantine, "shelter in place," "stay at home," workforce reduction, social distancing, shut down or similar actions and policies; (16) actions by third parties, including government agencies; (17) potential adverse reactions or changes to business relationships resulting from the announcement or completion of the transaction; (18) the risk that disruptions from the proposed transaction will harm Emerson's and the Company's business, including current plans and operations; (19) certain restrictions during the pendency of the acquisition that may impact Emerson's or the Company's ability to pursue certain business opportunities or strategic transactions; (20) the ability to meet expectations regarding the accounting and tax treatments of the proposed transaction; and (21) other risk factors as detailed from time to time in Emerson's and the Company's reports filed with the SEC, including Emerson's and the Company's annual report on Form 10-K, periodic quarterly reports on Form 10-Q, periodic current reports on Form 8-K and other documents filed with the SEC. These risks, as well as other risks associated with the proposed transaction, will be more fully discussed in any proxy statement(s) and other relevant materials related to the proposed transaction if and when they are filed with the SEC. While the list of factors presented here is, and the list of factors to be presented in any such proxy statement(s) or materials will be, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Any forward-looking statements speak only as of the date of this communication. Emerson undertakes no obligation to update any forward-looking statements, whether as a result of new information or development, future events or otherwise, except as required by law. Readers are cautioned not to place undue reliance on any of these forward-looking statements. 

Investors: 

Colleen Mettler Vice President, Investor Relations (314) 553-2197

Media: 

Jim Golden / Joseph Sala / Tanner Kaufman Joele Frank , Wilkinson Brimmer Katcher (212) 355-4449

1  Hart-Scott-Rodino Antitrust Improvements Act of 1976

SOURCE Emerson

Modal title

Also from this source.

Emerson's Transformative GenAI Automation Delivers Powerful New Tool for Power and Water Industries

As part of its release of the Ovation™ 4.0 Automation Platform, global automation and technology leader Emerson (NYSE: EMR) is delivering...

Emerson's New Ovation 4.0 to Deliver Software-Defined, AI-Ready Automation Platform for Power and Water Industries

Global automation and technology leader Emerson (NYSE: EMR) is updating its industry-leading Ovation™ Automation Platform to include a...

Computer Software

Computer & Electronics

Banking & Financial Services

• Click to view our Accessibility Policy and contact us with accessibility-related issues
• Skip to Navigation
• Skip to Content
• Skip to Search

Emerson Investor Information

Find our latest financial and investor information, including annual reports, quarterly earnings, regulatory filings and corporate governance.

Emerson Reports 2nd Quarter Results

Download the 2nd Quarter Earnings Presentation

Watch the 2nd Quarter Earnings Webcast

Solving the Unsolvable

At Emerson, we believe in innovation built for and with our customers. Throughout our 133-year history, we’ve been inside every kind of business, working with our customers to overcome complex challenges, seize opportunities and achieve ultimate performance. Powered by our comprehensive, integrated automation portfolio and backed by our proven track record of execution, we are solving the unsolvable.

2023 Annual Report

Our 2023 progress and performance, marking our 67th year of consecutive increased dividends

2023 Sustainability Report & Hub

Our vision for the future and our progress toward net zero emissions

Events & Presentations

Schedule of investor events, an archive of presentations, quarterly earnings & conference calls

Acquisitions & Divestitures

Accelerating growth and creating value for shareholders through strategic acquisitions and divestitures

Investor Resources

Investor Tools

View stock performance, shareholder information and access investor tools. 

SEC Filings

View our regulatory filings with the U.S. Securities & Exchange Commission. 

Dividend History

Quarterly dividends declared for most recent five years and historical dividend download.

Financial Press Releases

Explore financial press releases including earnings, acquisitions and more.

Corporate Governance

Learn about Emerson's corporate governance policies and our commitment to the highest standards in business and personal conduct. 

Board of Directors

Independent & inside Board of Directors members.

Latest News

Emerson schedules third quarter 2024 earnings release and conference call, emerson announces sale of remaining interests in copeland to blackstone, emerson to present at j.p. morgan’s 2024 industrials conference.

Emerson is the global technology, software and engineering powerhouse driving innovation that makes the world healthier, safer, smarter and more sustainable.

• Privacy Notice
• Terms of Use
• Data Protection
• Accessibility
• Communication Preferences
• Report a Vulnerability
• Do Not Sell or Share My Personal Information
• Transparency in Coverage Machine-Readable Files

By selecting a new country/region, product(s) may be unavailable and items in your shopping cart will be removed. Please  contact us  for assistance.

Not registered?

• Today's news
• Reviews and deals
• Climate change
• 2024 election
• Fall allergies
• Health news
• Mental health
• Sexual health
• Family health
• So mini ways
• Unapologetically
• Buying guides

Entertainment

• How to Watch
• My Portfolio
• Latest News
• Stock Market
• Biden Economy
• Stocks: Most Actives
• Stocks: Gainers
• Stocks: Losers
• Trending Tickers
• World Indices
• US Treasury Bonds
• Top Mutual Funds
• Highest Open Interest
• Highest Implied Volatility
• Stock Comparison
• Advanced Charts
• Currency Converter
• Basic Materials
• Communication Services
• Consumer Cyclical
• Consumer Defensive
• Financial Services
• Industrials
• Real Estate
• Mutual Funds
• Credit Cards
• Balance Transfer Cards
• Cash-back Cards
• Rewards Cards
• Travel Cards
• Credit Card Offers
• Best Free Checking
• Student Loans
• Personal Loans
• Car Insurance
• Mortgage Refinancing
• Mortgage Calculator
• Morning Brief
• Market Domination
• Market Domination Overtime
• Asking for a Trend
• Opening Bid
• Stocks in Translation
• Lead This Way
• Good Buy or Goodbye?
• Financial Freestyle
• Capitol Gains
• Fantasy football
• Pro Pick 'Em
• College Pick 'Em
• Fantasy baseball
• Fantasy hockey
• Fantasy basketball
• Download the app
• Daily fantasy
• Scores and schedules
• GameChannel
• World Baseball Classic
• Premier League
• CONCACAF League
• Champions League
• Motorsports
• Horse racing
• Newsletters

New on Yahoo

• Privacy Dashboard

Yahoo Finance

Emerson electric co. (nyse:emr) q4 2023 earnings call transcript.

Emerson Electric Co. (NYSE: EMR ) Q4 2023 Earnings Call Transcript November 7, 2023

Emerson Electric Co. misses on earnings expectations. Reported EPS is $1.29 EPS, expectations were $1.3.

Operator: Good day and welcome to the Emerson Fourth Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Colleen Mettler, Vice President of Investor Relations. Please go ahead.

Colleen Mettler: Good morning, and thank you for joining us for Emerson's fourth quarter and full year 2023 earnings conference call. Today I am joined by President and Chief Executive Officer, Lal Karsanbhai; Chief Financial Officer, Mike Baughman; and Chief Operating Officer, Ram Krishnan. As always, I encourage everyone to follow along with the slide presentation, which is available on our website. Please join me on Slide 2. This presentation may include forward-looking statements which contain a degree of business risk and uncertainty. Please take time to read the safe harbor Statement and note on the non-GAAP measures. I will now pass the call over to Emerson's President and CEO, Lal Karsanbhai, for his opening remarks.

Lal Karsanbhai: Thank you, Colleen. Good morning. 2023 was an exceptional year for Emerson. The management team, alongside the Board of Directors, boldly delivered across the three dimensions of our value creation strategy. Firstly, culture. Our management team just completed a trip around the world where we had the opportunity to engage with our customers and our teams. It was an energizing trip and it was evident to me that the changes we are driving in the culture of Emerson are embraced as evidenced by our engagement survey. 2023 was an important year. We made significant progress across multiple dimensions of culture. We rolled out an employee value proposition, advanced our diversity and inclusion metrics, and made significant strides in our sustainability targets as well as launching a differentiated talent engine program.

Second, our portfolio transformation is largely complete. The Copeland divestiture and more importantly, the acquisition of NI have enabled us to create an Emerson focused on automation with a cohesive, higher growth, higher profit margin, diversified portfolio aligned to the critical macro secular drivers, energy security and affordability, near assuring, sustainability and decarbonization, and digital transformation. I would like to welcome Ritu Favre and the NI family to Emerson. This is an exciting time. With NI, our technology stack is unequaled, and we are in position to continue to push the boundaries of automation to meet our customers' needs. Thirdly, execution. The Emerson management system is delivering differentiated results. Underlying sales for 2023 grew 10%.

GPE expanded 330 basis points to 49%. And adjusted Segment EBITDA expanded 220 basis points to 25% after delivering yet another year of over 50% leverage. Adjusted earnings per share in 2023 grew 22% to $4.44 and free cash flow was $2.4 billion. Orders growth exited the year at 5% and we grew across all world areas. We had strong price realization in the business at 4% for the year. And MRO represents 65% of our revenue with now a $150 billion installed base around the world. And we exited the year with $6.6 billion of backlog, up 12% year-over-year. We delivered on innovation in 2023. It was a year of significant releases in our DeltaV platform, Aspen models, and intelligent devices. Our R&D spend as a percent of sales rose to 7% in 2023. Cost management is the way of life at Emerson.

The differentiated leverage of 53% is reflective of aggressive cost actions across our business. We also delivered on commitments of no stranded costs related to the Copeland transaction, and will be delivering on the $100 million corporate cost takeout by the end of 2024 through significant transformational activities driving certain functional activities to centralization and best cost locations. I am humbled by the exactness of our performance And I'm certainly optimistic about the future of our company. I'd like to express my appreciation to our customers who increasingly place their trust in Emerson to solve the world's most challenging problems. And lastly, in my opening remarks, I'd like to say I am but one of over 70,000 Emerson team members around the world.

I'd like to thank our global employees for your passion, hard work, and energy that you bring to Emerson every single day. Please turn to Slide 3. As I said earlier, and it bears repeating, 2023 was an exceptional year. We are excited to run this cohesive high growth and diversified portfolio. The financial performance was differentiated with double-digit underlying sales growth, 53% operating leverage, and 22% adjusted EPS growth. As we look ahead, 2024 is expected to be another strong year. Operating leverage, excluding NI, is expected to be in the mid to high 40s, and adjusted EPS is expected to be $5.15 to $5.35, including roughly $0.35 to $0.40 contribution from NI. We hit the ground running on October 11, as soon as we closed the transaction, to begin executing the synergy plan and we expect it to provide early benefits in 2024.

We are expecting 4% to 6% underlying sales growth, driven by our focus and commitment to winning in our growth platforms, and leveraging our innovation. Energy transition, industrial software, life sciences and metals and mining are expected to remain resilient parts of our portfolio and we are utilizing our leading technology, customer relationships, installed base and expertise to capture investments in these markets. While discrete markets are down in both our factory automation business and test and measurement, we are expecting recovery in the second half of the year. Turning to Slide 4 for some additional details on how we finished the year. 2023 was a remarkable operational year for Emerson. Starting with the orders performance, our teams executed exceptionally throughout the year.

We won in the marketplace. We won in markets like LNG, hydrogen, renewables, life sciences, and metals and mining, resulting in 5% orders growth for the year. This shows our portfolio relevance and leadership position for our customers. Orders were also up 5% in Q4, led by double-digit order growth in China and the rest of Asia. Underlying sales were up double digits for the year, exceeding our initial expectation of 6.5% to 8.5% last November and in line with our August guidance. The strength was widespread across the organization with all world areas growing 9% to 10% and both business groups growing 10%. I am most proud of our performance around operating leverage this year. 53% is differentiated. It is a testament to our Emerson management system and our operational talent, which drove strong performance.

Adjusted EPS ended the year at $4.44, beating the midpoint of our original November guidance by $0.37 and near the top of our August guidance. Lastly, free cash flow of $2.4 billion was up 35% year-over-year and above our August guidance. Turning to Slide 5. Our 2023 performance caps three strong years of execution, demonstrating the power of our Emerson management system and its ability to create value for our shareholders. We embarked on a transformational journey of Emerson in 2021 and remained focused on execution. Underlying sales growth of 7% and 10% in 2022 and 2023, respectively, shows the leadership position of our automation technology and our world-class sales organization. It is also indicative of our market share expansion within the $160 billion served automation market.

Our ability to both leverage our $150 billion installed base as evidenced by our MRO sales in 2023 of 65%, and win new projects are strengths of this company and critical to the long-term success of this business. As we invest more in digital technology and software, we are also seeing the benefits to gross margins, which have expanded 470 basis points to 49% since 2021. Strong price discipline and differentiated technology have also provided positive contributions, and the addition of NI will further expand our gross margins. This enabled strong operational leverage across the business. Over 50% leverage for 2022 and 2023 is distinguished amongst industrials. Cost discipline remains part of the DNA at Emerson, driving further cost productivity and margin expansion.

Put all this together and Emerson has delivered back-to-back years of 20-plus-percent EPS growth. Please turn to Slide 6. I want to provide a couple strategic updates on our business. In October, we hosted Emerson Exchange Immerse in Anaheim, California. The event showcased our control systems and software technology and highlighted our integration with AspenTech throughout different solutions and industries. Featuring over 1,400 attendees and over 100 customer presentations, the week was spent discussing the exciting roadmap of our Delta V, Ovation, and AspenTech products and working with customers to solve their toughest challenges. This was all reflected in our keynote presentations from three important customers, Syzygy, a provider of electric catalyst reactor technology, Biogen, and Tesla, who discussed their automation challenges in partnership with Emerson.

These types of engagements not only help our users understanding of our current products, but also provide important inputs into our next generation products and innovation. Throughout this event, we highlighted our boundless automation vision, the next generation automation architecture that Emerson is uniquely positioned to deliver based on our leadership position in intelligent devices, control systems, and software. This vision empowers our customers to unlock and access all their operational data, enabling better decisions through analytics and optimization. It also enables customers to balance their production and sustainability goals through enterprise management and a unified software platform. On Slide 7, as part of this vision, we continue to accelerate innovation across four priority domains, disruptive measurement technologies, software defined automation systems, self-optimizing asset software, and our sustainability portfolio.

Each of these areas provide stepping stones to enable the boundless automation vision. At Immerse, we introduced many significant new products to our leading DeltaV portfolio. First, DeltaV Version 15 Feature Pack 1 is one of our biggest rollouts in recent history. The package includes enhancements to software like DeltaV Live, the most advanced DeltaV HMI ever developed, and the introduction of a subscription controller, PK Flex. It also includes the DeltaV Edge Environment, a first-of-its-kind edge solution, allowing users to securely move data into their enterprise environments. As we look at the next generation of software solutions and automation platforms, this is a key enabler to unlocking data that users previously discarded. Throughout the rest of the organization, we are also making focused investments in strategic areas.

This includes next-generation intelligent devices to further cement our leadership position in our measurement and analytical portfolio, and relevant additions to our sustainability portfolio. At AspenTech, many of the new releases are focused on enabling sustainability and energy transition segments, in addition to further building out capabilities like AI and DataWorks to enable self-optimizing asset management. Please turn to Slide 8. On October 11, we closed the acquisition of NI and announced we will report the business as a new test and measurement segment in 2024. We are very pleased with the progress already in the first month with NI and are excited about the opportunities in this business. We remain committed to the $165 million of synergies by the end of year five, resulting in approximately 31% adjusted segment EBITDA when moving stock comp to corporate.

As we have openly stated, NI completes the significant portion of our portfolio transformation, and we are excited to execute as a new company. We will, however, continue to be active with bolt-on acquisitions that fill technology gaps in our business, and we have the balance sheet flexibility to do so. These will be prioritized in four segments we introduced a year ago, industrial software, test and measurement, factory automation, and smart grid solutions. In the fourth quarter, we completed two of these bolt-on acquisitions. Flexim is a global leader for clamp-on ultrasonic technology measuring liquids, gases, and steam. The business is highly complementary to our existing leading flow portfolio consisting of Coriolis, DP Flow, Mag & Vortex, and will also serve attractive growth markets in the energy transition.

We also completed the acquisition of Afag in the fourth quarter, a highly strategic asset in the factory automation market. Afag’s electric linear motion solutions, combined with our existing pneumatic motion offering creates a leading motion portfolio for discrete industries in a $9 billion TAM. Please turn to Slide 9. As I mentioned, the large pieces of our portfolio transformation are behind us. And this slide shows that we were able to accomplish what we were able to accomplish over the last few years. We have three main objectives that I communicated when we started this journey. First, cohesiveness, which we now have with an unmatched technology stack. Second, diversification. Discrete is now our second largest end market with further opportunities to expand into attractive diversified industries.

And third, our growth is aligned to secular growth drivers. This alignment to energy security and affordability, sustainability and decarbonization, near-shoring, and digital transformation will allow Emerson to move to a more secular and less cyclical business profile. $36 billion worth of transactions. Disposing of assets with low single digit growth profiles and adding businesses we expect to grow cumulatively in the high single-digits to low double-digits. The profitability improvement is also remarkable. Trading 30% GP businesses for those that operate 70% plus gross profits, which are already seeing -- which we are seeing the benefits of today. We are all energized by the opportunity we have with this new Emerson. Please turn to Slide 10.

Our current strategic funnel is now over $10 billion in opportunity, with nearly two-thirds residing in our growth platforms. We're also encouraged by the activity of projects already in the funnel, considering the interest rate environment and global uncertainty. In the fourth quarter, Emerson was awarded over $500 million of project content, with over 60% of those in our growth platforms. This includes strategic wins in LNG, carbon capture, hydrogen, life sciences, and metals and mining. These successes are indicative of our team's focus and our technology's relevance within these markets. As we look at further diversifying our portfolio into hybrid and energy transition markets, 2023 was a fundamental foundational year. Specifically, there were three highly strategic projects to highlight.

First, Emerson was selected to automate five different plants for Samsung Biologics as it standardizes on our DeltaV automation platform. The Emerson solution provides control for both production skids and for plant-wide operations. We are also currently engaging with a customer on the potential to leverage AspenTech software for future expansion. Secondly, in the third quarter, we highlighted Emerson's selection for the Port Arthur LNG project with Bechtel Energy and Sempra. This quarter, we are pleased to announce we were also selected for another large-scale world-class LNG facility in the United States. The Rio Grande LNG project from Bechtel Energy and NextDecade, located in Texas, will be capable of producing 17.6 million metric tons per annum of LNG across three liquefaction trains.

Emerson is providing much of our leading technology, including analytical and measurement technology, and control, pressure relief, and isolation valves. And finally, AspenTech was awarded a Synergy win in the most recent quarter with a world-leading pulp and paper producer. Emerson's DeltaV system is already installed at the site, and through this relationship with the customer, Emerson was able to bring AspenTech to the table. Through this engagement, the customer chose to displace the current incumbent provider of adaptive process control software and instead move to AspenTech. This example demonstrates the power of our Emerson AspenTech integrated solutions and the opportunity to expand AspenTech utilizing our global sales channel. These wins and the continued evolution of the funnel provide a strong foundation as we head into 2024.

With that, I will now turn the call over to Mike Baughman.

Mike Baughman: Thanks, Lal, and good morning, everyone. Please turn to Slide 11 that summarizes our fourth quarter financial results, which were in line with our expectations. Underlying sales growth was 5%, growing off a tough comp in 2022 when sales shifted from the third quarter into the fourth quarter due to China shutdowns and electronic component shortages. Price contributed approximately 4 points of growth. As expected with our typical seasonality, backlog declined sequentially about $300 million to $6.6 billion, up 12% versus where we entered 2023. Software and control sales grew 2% on an underlying basis, which now includes AspenTech as we lapped a year of ownership. The control systems and software business came in largely as expected and it was comparing against a very strong prior year Q4.

AspenTech tends to see lower sales volume in our fiscal Q4 due to the timing of renewals and its sales can be more variable due to ASC 606 accounting. The sales were on forecast and importantly ACV showed strong growth at 10.9% year-over-year. Intelligent devices grew 6%, led by process and hybrid exposed businesses, mainly measurement and analytical and final control. Our discrete automation business was down in the quarter with softer-than-expected demand and Europe and China weakness impacting this business. Emerson adjusted segment EBITDA margin improved 80 basis points to 25.5%. Operating leverage excluding AspenTech was 45%. Volume, margin accretive price cost, which included net material deflation and ongoing productivity programs contributed to the margin improvement.

Adjusted EPS grew 21% to $1.29. Lastly, free cash flow for the quarter of $838 million was up 17% versus the prior year. Please turn to Slide 12. As Lal summarized, 2023 was an exceptional year for Emerson. Underlying sales growth was 10% with 4 points of price contribution. Software and control and intelligent devices both finished with underlying sales growth of 10%. All geographies reported strong sales growth with Americas up 10%, Europe up 10%, and Asia, Middle East, and Africa up 9%. Emerson adjusted segment EBITDA margin improved 220 basis points to 25%. Operating leverage excluding AspenTech was 53%. As we've talked about throughout the year, this was driven by leverage on double-digit sales growth, strong execution by our operations teams, margin accretive price cost, and favorable product and project mix.

Adjusted EPS grew 22% to $4.44 with $0.27 of contribution from AspenTech. Lastly, free cash flow of $2.4 billion was up 35% versus the prior year. This includes approximately $100 million from the interest on undeployed proceeds from the Copeland transaction. For the year, free cash flow conversion of adjusted earnings was 88%, slightly ahead of our expectations. This also represents a 15.6% free cash flow margin, a metric we plan to utilize moving forward. Slide 13 details the drivers of adjusted EPS growth from the prior year. Operational performance was exceptional. 10% underlying sales growth and 53% segment level operating leverage contributed $0.77 of year-over-year EPS growth. FX was a $0.12 headwind. Stock comp was a $0.16 headwind versus the prior year, due primarily to the mark-to-market accounting for the company's old stock compensation plan, which was mostly offset by pension and other corporate items.

The reduced share count resulting from the $2 billion share repurchase contributed $0.14, and the Copeland note receivable interest contributed $0.05 to adjusted EPS for the year. Overall, adjusted EPS grew 22% year-over-year to $4.44. Please turn to Slide 14. We believe 2024 is shaping up to be another good year of financial performance. Our end markets remain generally resilient, evidenced by 5% underlying orders growth in Q4 and for all of 2023. This has resulted in healthy backlog levels, which were up 12% versus where we entered 2023, giving us good visibility into 2024 sales. We also have good visibility through our MRO business, which was 65% of 2023 sales. This day-to-day replacement business gives us good perspective on pace of business and remains constructive.

Lastly, we are entering 2024 with a $10 billion-plus funnel, up $3 billion from where we entered 2023. This all feeds our 2024 outlook. Process and hybrid end markets remain strong, driven by secular trends like energy security, sustainability and decarbonization, nearshoring and digital transformation. We expect process and hybrid sales growth of mid to high single-digits in 2024. We continue to see investments moving forward in energy transition markets like LNG, nuclear, hydrogen, carbon capture and renewables. We continue to see nearshoring investments here in the US and around the world in life sciences and metals and mining, especially midstream metals processing and refining, which is being expanded to the United States and Europe. These secular trends in process hybrid end markets and our ability to help customers be successful give us confidence in our 2024 outlook.

Discrete markets are obviously in a different part of the cycle, which impacts both our discrete automation and test and measurement businesses. Orders have been negative for two to three quarters but we expect this to begin to turn positive in the second half of 2024. We expect underlying sales to be flat to up low single-digits in 2024 for our discrete businesses -- for our discrete business. From a world areas perspective, it should continue to be a balance, and we expect each world area to grow in the mid-single-digit range. Please turn to Slide 15, where we have outlined our 2024 guidance. Our later cycle exposure, robust backlog and continued orders resiliency support our 2024 guidance for underlying sales growth of 4% to 6%. We expect both intelligent devices and software and control to be within this guidance range for underlying sales.

Test and measurement is excluded from 2024 underlying sales and is expected to add another 10 to 10.5 points to reported growth or approximately $1.6 billion of sales. FX is expected to be a 1 point tailwind. We remain committed to driving differentiated incremental margins through our operational execution. Operating leverage, which now includes AspenTech, but excludes test and measurement, is expected to be in the mid to high 40s in 2024, which includes cost savings from our corporate and platform rightsizing. Price/cost will continue to be margin accretive in 2024 and ongoing productivity and cost savings will drive further benefits. We expect adjusted EPS to increase from $4.44 in 2023 to between $5.15 and $5.35 in 2024, an 18% increase at the midpoint.

This includes approximately $0.35 to $0.40 from NI, inclusive of stock compensation and approximately $0.32 to $0.34 from AspenTech. There are some movements below the line in stock compensation, pension and other corporate items, which roughly offset year-over-year. This detail can be found in the appendix. As a reminder, stock compensation from NI is now reported in our corporate stock compensation line item. Net interest expense is expected to be approximately $105 million. Lastly, free cash flow is expected to be $2.6 billion to $2.7 billion, which we will discuss in more detail on the next slide. For the first quarter, we expect underlying sales to increase 6.5% to 8.5% with leverage in the mid-30s. Adjusted EPS is expected to be between $1 and $1.05, a 31% increase at the midpoint.

NI is expected to contribute approximately $0.05. As I mentioned, we will discuss some additional details on Slide 16 regarding our free cash flow. We ended 2023 with free cash flow of $2.4 billion or 15.6% of sales. This included just over $100 million of after-tax cash from interest on the undeployed proceeds from the Copeland transaction, which will not repeat in 2024. Taking this into consideration and starting from a foundation of approximately $2.3 billion of free cash flow, we expect approximately $300 million of contribution from NI operations and another $350 million increase from base operations. This would have resulted in a free cash flow margin of approximately 16.8% or $2.9 billion of free cash flow. However, we have two headwinds in 2024.

First, we expect approximately $200 million of acquisition-related cash payments associated with the NI and bolt-on acquisitions. Second, we are expecting an elevated CapEx spend related to facility expansions, which will increase our CapEx to approximately 2.5% of sales, up from our historical and future expected rate of approximately 2% of sales. Including these two headwinds bring us to our guidance of $2.6 billion to $2.7 billion of free cash flow or 15.2% to 15.4% free cash flow margin. Before we turn the call over to Q&A, I will quickly discuss capital allocation on Slide 17. We remain committed to disciplined capital allocation. Internal development and organic growth investments remain a high priority. This accelerated in 2023 with R&D spend now representing 7% of revenue and NI will further mix this up in 2024.

This increase was driven by increased innovation in our four priority breakthrough domains, disruptive technologies and measurement, sustainability, software-defined automation systems, and self-optimizing asset software. We also remain committed to the dividend and announced today, we are beginning our 68th year of consecutive increased dividends with our $0.525 per share declared dividend this quarter. The right side of this chart is where we have flexibility. We will continue to be active in pursuit of strategic bolt-on acquisitions to strengthen our portfolio in targeted areas and we will remain committed to strong returns on these investments. Finally, we plan to have approximately $500 million of share repurchases in 2024. We are energized as we enter the new fiscal year, and we are focused on the execution of our plans.

Thanks for your attention. I will turn it back to the operator to open the call for questions.

See also 15 Most Valuable Clothing Companies in the World and Top 30 Developing Countries in the World.

To continue reading the Q&A session, please click here .

You're reading a free article with opinions that may differ from The Motley Fool's Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

5 Key Takeaways From Emerson Electric Co. Presentations

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources , and more. Learn More

Emerson Electric

Here's what management sees for the future of the company, and how it affects the investment proposition for the stock.

Emerson Electric Co. 's  ( EMR 1.22% ) 3.2% dividend yield and 60-year history of increasing dividend payments makes it an income investor's favorite. However, following the divestitures of the network power segment and two industrial automation businesses, and a tough 2016 in which underlying sales fell 7%, investors might be concerned about its dividend growth prospects. Simply put, Emerson needs to get back to growth. With this in mind, here are some key takeaways from management's recent presentation.

Orders are coming back

In common with other industrial companies like Rockwell Automation ( ROK 1.17% )  and  General Electric Company ( GE 1.62% ) , Emerson has significant exposure to the oil and gas industry -- something that hurt all three companies in 2016. However, there is a growing consensus that energy capital spending is in recovery mode following deep cuts in the last two years. As a consequence,  Rockwell raised its 2017 organic growth forecast, while GE's organic oil and gas orders grew for the first time in two years in its fourth quarter. 

Meanwhile, the latest trailing-three-month order data from Emerson supports the idea that the company, and oil and gas spending, is in recovery mode.

Data source: Emerson Electric presentations.

Sales trends are favorable

While management's forecast for underlying sales growth in 2017 is superficially disappointing -- in the range of a 2% decline to flat -- the underlying trend is good. In fact, on the investor day presentation in February, management estimated that underlying sales growth would turn positive in the third quarter -- something to look out for when Emerson Electric reports earnings. 

Data source: Emerson Electric presentations. Chart by author.

Margins are growing

Back on the fourth-quarter earnings call, CEO David Farr referred to rising cost pressure in 2017, sparking concern that margins would come under pressure.

However, in the investor day presentation in February, Farr estimated that both gross margin and earnings before interest and tax (EBIT) margin would rise in 2017. Full-year gross margin is expected to increase to around 43.4% from 43.1% in 2016, and EBIT margin from 17.2% to 17.9%. It's a good sign in a year in which overall sales are expected to decline 3% to 1%, and also an indication that when sales eventually start to grow again, Emerson might be able to leverage revenue growth into strong earnings growth.

Dividends are stable...

The effects on revenue and free cash flow (FCF) from Emerson's end-market slowdown and the divestitures can be seen below, and given the importance of dividends to income investors, it's important to look at management's projections.

EMR Revenue (TTM) data by YCharts .

As you can see above, dividends paid to shareholders were around $1.23 billion in 2016. Based on management's projections for $2.5 billion in operating cash flow and $475 million in capital expenditures in 2017, FCF is likely to be around $2.025 billion in 2017. This would mean the 2016 dividend alone would represent slightly more than 60% of FCF -- management has previously stated an intent for a ratio of 40% to 50%. In other words, while the dividend is well covered, don't expect much dividend growth in the next five years.

...but don't expect much dividend growth

Management's projection of $2.7 billion in FCF in 2021 means that, based on a dividends paid/FCF ratio of 50%, dividends paid would be $1.35 billion in 2021 -- a figure only 9.7% ahead of what was paid in 2016.

Furthermore, when a company is paying out a high amount of its FCF in dividends, it reduces the company's financial firepower to make earnings- and cash-flow-enhancing acquisitions. In a nutshell, dividend growth is likely to be very moderate for the next five years. 

Emerson Electirc Co needs oil and gas capital spending to come back. Image source: Getty Images.

What income investors can expect from Emerson Electric

All told, if you want a steady, 3% dividend yield, the current stock price is attractive, but don't expect too much in terms of growth going forward. Moreover, while Emerson Electric's end markets are on an uptrend, much of it is contingent on oil prices stabilizing and energy capital spending increasing. If you're confident of the latter, and you like an income stream from an investment, then Emerson Electric is worth consideration, but it won't shoot the lights out. 

Lee Samaha has no position in any stocks mentioned. The Motley Fool owns shares of General Electric. The Motley Fool recommends Emerson Electric. The Motley Fool has a disclosure policy .

Related Articles

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.

Rewriting the Investor Day Playbook: Tips for Executing a Successful Virtual Event

Two investor day experts combine experience to deliver best practices on leveraging digital platforms to deliver a compelling virtual investor day

The investor day is one of the most effective platforms for presenting your company’s strategy, outlining your long-term targets and showcasing the depth and strength of your management team. with the world moving to virtual formats for the foreseeable future, iros are faced with a new task – mastering virtual investor day planning. this pivot presents new challenges as well as exciting new opportunities to engage and communicate critical messages with the investment community., the following are top tips for iros to master to execute a successful virtual investor day:, 1. follow the fundamental rules of executing a successful investor day – which remain the same.

While there are many things that are different, the fundamental building blocks of investor day planning remain intact, whether executing an event in person or virtually.  These include:

• Start with an understanding of market perceptions – A critical first step for investor day planning is to understand what investors want to know about your company and what would compel them to increase or initiate a position in your stock. To do so, it can be helpful to engage with a third-party to conduct a perception study and leverage the findings as a roadmap to develop your agenda, messaging and slides.
• Identify a few key messages for the day – Typically this will be three to four key messages that you want the audience to be sure to understand when they leave the meeting. A helpful practice is to consider what you want analyst report headlines to reflect the day after your event. You will want to get executive buy-in on the key points you identify and then build your investor day program around these.
• Build effective presentations – To create compelling presentations that strike a balance between simplicity and meaningful content, David Fine advises to follow his four best practices in presentation development: 1) have clear messages, 2) use a structured flow that tells a story, 3) create simple slides with a clear takeaway in the title and 4) leverage strong and meaningful design.
• Provide multi-year outlook – Investors want to walk away from an investor day with a view of your company’s financial potential over time, and as the world normalizes, will expect some longer-term guidance of key metrics. With the uncertainty and fluidity of COVID-19 affecting visibility for most companies, providing mid- or long-term financial targets becomes more challenging than usual. This should be a high-priority topic to address with management at the start of the planning process to vet out what metrics, ranges, assumptions or scenarios your company can reasonably provide in the current environment.

2. Drive audience engagement

The need to engage a virtual, and easily distracted audience, is one of the biggest differences to consider as you plan your investor day. To keep your audience engaged, consider the following strategies:

• Shorten the event – Best practice is to keep your virtual event to approximately two and a half hours compared with the typical four to five hours for in-person investor days.
• Incorporate video of your speakers – Video versus an audio-only webcast can make a major difference in engaging your virtual audience.
• Ensure clear, content-dense presentations – The shorter event timeframe puts an even greater emphasis on creating compelling and concise presentations that get to the heart of the issues investors want to better understand.
• Prioritize Q&A – Ideally 30% to 40% of the event time should be dedicated to Q&A to break up the presentations and engage your audience.
• Leverage digital assets to make your story come alive – For example, include customer testimonial videos, product demos, virtual tours or advance screenings of new promotional videos.
• Incorporate interactive sessions – Fireside chats or panel discussions with customers, industry experts or leaders within your organization can be highly engaging and an excellent way to validate your company’s market position or strategy.

3. Prioritize planning

As we know from planning traditional investor days, there are many logistics to consider with an investor day, and virtual events are no different. Instead of things like catering, presentation printing and room reservations, you will need to manage digital-world logistics like platform technical specifications, Q&A logistics and speaker Internet and video capabilities.

• Select a strong technology partner. With a virtual event it is imperative that you vet your technology partner(s) thoroughly to make sure they can support your event goals and the interactive features that support your message. This means understanding the webcast platform’s capabilities, limitations and deadlines for functions such as video-based speaker presentations, integrating pre-recorded content, streaming product/demo videos, streaming live multi-speaker panels, and hosting live Q&A. Before signing with a platform, request references from other IROs who have used the service for an investor day to verify the platform’s reliability and leverage learnings from technical hurdles they may have encountered.When you can, pre-record. To minimize risk of technical issues, pre-record as much as possible. That goes for the speaker’s prepared remarks, customer panels, virtual tours and product demos.Think through how you will handle Q&A. How you handle Q&A is probably one of the most important logistical decisions you’ll need to make. You will need to make sure the Q&A sessions are well planned and tightly choreographed. Some questions to consider are:
• How will you take questions? There are several approaches to consider with pros and cons to each. For example, the IRO can announce questions submitted from analysts and investors through email or the chat function, or you can open up the line for analysts and investors to ask questions. Another option is to have a panel of analysts on video ask questions of the speakers.  You also can use a platform like Slido, where the audience can submit questions and then vote on which should be posed.
• How will your team answer questions? Will you have a panel of speakers available by audio or video? Which speakers will participate in each Q&A segment?
• Who will moderate the Q&A? This may be the IRO or it could be an operator, depending on the approach to Q&A you select.
• Will you give attribution? If you choose to ask questions that are submitted via chat or email, you will need to decide if you identify who asked the question.

4. Prepare your speakers for the virtual stage

In delivering a presentation, there’s an inherent difference between communicating face-to-face and through a video platform. With a virtual presentation, you will need to consider speaker delivery and each speaker’s setting. Here are a few pointers to keep in mind:

• Leverage the power of voice – Since the use of a small computer screen limits your ability to fully leverage the power of body language, your voice becomes that much more important. That means that each speakers’ enthusiasm for the company needs to come across in the tone and tenor of their voice. It is important to speak loudly, clearly and most importantly, use vocal variety. Adjusting the tone and cadence throughout the presentation makes the delivery more interesting, keeps people’s attention and emphasizes key messages.
• Use gestures with caution – Gesturing also can be effective in bringing more energy to the screen, but speakers will need to be aware how their gestures come across the webcam so that they don’t, for example, have a giant hand coming at the audience.
• Eye contact is critical – To make sure speakers are making eye contact with the audience, they will need to be set up to focus on the webcam or laptop camera, not their script or second screen. Putting the script on the same screen as your webcam works well, as does placing a second monitor directly behind the webcam.
• Professionalism matters – If you’re using video, definitely consider using a professional production team. And if not, invest in high-def cameras and good mics for all of your speakers to enhance the production quality for each of your speakers.
• Think wardrobe – While dress codes are decidedly less formal in this new virtual world, it’s still important to look professional and reflect the image you want to convey about your company and its culture.
• Note backgrounds as they will be judged – In today’s virtual world, a backdrop is worth a thousand words. Each speaker’s background should convey the right image for your company. You may, for example, consider having each speaker against a similar, simple background or it may align better with your culture to have each speaker in their unique setting. With more complex backgrounds, think about the details as they will be noted. If there’s a bookshelf behind the speaker, for example, what books can the audience see, and what do they say about the speaker.  Also consider using the virtual background function and feature your company logo behind the speakers.
• Room lighting matters – You don’t want your speaker to be either washed out or completely in shadows. Natural light coming from the front and sides of the speaker is best.  When you hold your dress rehearsal, hold it at the same time of day as the actual event so that you can see how natural light presents your speakers.

5. Practice, practice practice…on the platform that you will be using

For any investor day, it is imperative that you rehearse, but even more so with a virtual format that is likely to be a new experience for most presenters. You should hold at least two full rehearsals and at least one of which should be on the platform you are using to ensure you iron out all of the logistics (e.g. transitions between speakers, driving the slides, mock Q&A, etc.). There really is no such thing as being over-rehearsed or “sounding rehearsed.” You just need to rehearse the right way.

While the shift to virtual formats today is out of necessity, experts and investors agree that the virtual event is here to stay as a go-to-resource for IROs. Not only are virtual formats more convenient for investors (no travel required), but they can be considerably more cost effective for companies, allow for engagement with an unlimited audience size and, when done right, can more effectively deliver on your goals. For this reason, IROs can leverage learnings from their virtual investor day to build high-touch virtual interactions into your IR program going forward.

Fine Communications Inc. is a boutique communications firm specializing in investor presentations. For more information contact David Fine at [email protected].

Sharon Merrill  is a strategic advisory firm that counsels IROs on virtual investor day planning; effective presentation development; and virtual meeting presentation coaching.  Contact us  to discuss how we can help.

Sharon Merrill and Fine Communications recently joined Mark Grant, Vice President, Investor Relations, GoDaddy Inc. on a NIRI-hosted webinar to discuss practical advice for hosting a compelling virtual investor day. To view the replay, click here .

David Calusdian

David is an accomplished communicator with more than 30 years of experience in advising and coaching CEOs, CFOs, IROs, and boards of directors through a range of critical communications events, including IPOs, quarterly earnings results, executive transitions, and M&A. David is an acknowledged authority on executive presentation coaching, investor relations strategy, investor day execution, and strategic messaging.

Previous Post ESG in 2020: 6 Steps to Start Your ESG Journey with Confidence

Next post the art of the virtual non-deal roadshow.

Comments are closed.

501 Boylston Street, 10th Floor Boston, MA 02116 Phone: 617-542-5300 Email: [email protected]

• Investor Relations Advisory
• Sustainability
• Investor Days
• Executive Coaching
• IPO Investor Relations
• Transactions & Specialized Programs
• Meet Our Team
• The Advisor Blog
• IR Trending

© 2024 Sharon Merrill Advisors | Privacy Policy | Terms of Use

501 Boylston Street, 10th Floor Boston, MA 02116 617-542-5300 [email protected]

English (USA)

English (UK)

English (Canada)

English (India)

Deutsch (Deutschland)

Deutsch (Österreich)

Deutsch (Schweiz)

Français (France)

Français (Suisse)

Nederlands (Nederland)

Nederlands (België)

• Top Capitalization
• United States
• North America
• Middle East
• Sector Research
• Earnings Calendar
• Equities Analysis
• Most popular
• MICROSOFT CORPORATION
• NIPPON ACTIVE VALUE FUND PLC
• AMD (ADVANCED MICRO DEVICES)
• META PLATFORMS, INC.
• STELLANTIS N.V.
• Index Analysis
• Indexes News
• EURO STOXX 50
• Currency Cross Rate
• Currency Converter
• Forex Analysis
• Currencies News
• Precious metals
• Agriculture
• Industrial Metals
• Livestock and Cattle
• CRUDE OIL (WTI)
• CRUDE OIL (BRENT)

• Yield Curve
• Developed Nations
• Emerging Countries
• South America
• Analyst Reco.
• Capital Markets Transactions
• New Contracts
• Profit Warnings
• Appointments
• Press Releases
• Security Transactions
• Earnings reports
• New markets
• New products
• Corporate strategies
• Legal risks
• Share buybacks
• Mergers and acquisitions
• Call Transcripts
• Currency / Forex
• Commodities
• Cryptocurrencies
• Interest Rates
• Asset Management
• Climate and ESG
• Cybersecurity
• Geopolitics
• Central Banks
• Private Equity
• Business Leaders
• All our articles
• Most Read News
• All Analysis
• Satirical Cartoon
• Today's Editorial
• Crypto Recap
• Behind the numbers
• All our investments
• Asia, Pacific
• Virtual Portfolios
• USA Portfolio
• European Portfolio
• Asian Portfolio
• My previous session
• My most visited
• Undervalued stocks
• Quality stocks
• Trend-Following Stocks
• Dividend Aristocrats
• The genomic revolution
• Strategic Metals
• Place your bets
• Unusual volumes
• New Historical Highs
• New Historical Lows
• Top Fundamentals
• Sales growth
• Earnings Growth
• Profitability
• Rankings Valuation
• Enterprise value
• Top Consensus
• Analyst Opinion
• Target price
• Estimates Revisions
• Top ranking ESG
• Environment
• Visibility Ranking
• Stock Screener Home
• Space Exploration
• E-Commerce & Logistics
• Israeli innovation
• Pricing Power
• Oversold stocks
• Overbought stocks
• Close to resistance
• Close to support
• Accumulation Phases
• Most volatile stocks
• Top Investor Rating
• Top Trading Rating
• Top Dividends
• Low valuations
• All my stocks
• Stock Screener
• Stock Screener PRO
• Portfolio Creator
• Event Screener
• Dynamic Chart
• Economic Calendar
• Our subscriptions
• Our Stock Picks
• Thematic Investment Lists

Emerson Electric Co.

Us2910111044, electrical components & equipment.

• Emerson to Make Available Presentation Materials from Investor Conference

Emerson (NYSE: EMR) announced today that presentation materials from its investor conference will be made available at 7:15 a.m. Central Time / 8:15 a.m. Eastern Time on Tuesday, Nov. 29 at emersoninvestorconference.connectid.cloud . The conference will include presentations from President and Chief Executive Officer Lal Karsanbhai and other senior executives.

A live webcast of the investor conference will begin at 8:00 a.m. Central Time / 9:00 a.m. Eastern Time. A link to register and attend the webcast is available at emersoninvestorconference.connectid.cloud . The webcast will remain available for 90 days.

About Emerson

Emerson (NYSE: EMR) is a global technology and software company providing innovative solutions for the world’s most essential industries. Emerson is an automation leader that helps process, hybrid and discrete manufacturers optimize operations, protect personnel, reduce emissions and achieve their sustainability goals through its unmatched automation portfolio, including its majority stake in AspenTech. For more information, visit Emerson.com .

View source version on businesswire.com: https://www.businesswire.com/news/home/20221128005062/en/

Latest news about Emerson Electric Co.

Chart Emerson Electric Co.

Company Profile

Income Statement and Estimates

Analysts' consensus, quarterly earnings, rate of surprise.

• Stock Market
• News Emerson Electric Co.

• Click to view our Accessibility Policy and contact us with accessibility-related issues
• Skip to Navigation
• Skip to Content
• Skip to Search

Emerson Schedules 2022 Investor Conference

ST. LOUIS (Nov. 10, 2022) – Emerson (NYSE: EMR) will hold an in-person and virtual investor conference on Tuesday, Nov. 29, 2022 in New York City. The conference will include presentations from President and Chief Executive Officer Lal Karsanbhai and other senior executives.

A live webcast of the investor conference will begin at 8:00 a.m. Central Time / 9:00 a.m. Eastern Time. A link to register and attend the webcast is available at emerson.com/en-us/investors/investor-resources/events-and-presentations . The webcast will remain available for 90 days.

About Emerson Emerson (NYSE: EMR) is a global technology and software company providing innovative solutions for the world’s most essential industries. Emerson is an automation leader that helps process, hybrid and discrete manufacturers optimize operations, protect personnel, reduce emissions and achieve their sustainability goals through its unmatched automation portfolio, including its majority stake in AspenTech. For more information, visit Emerson.com .

Latest News

Emerson’s transformative genai automation delivers powerful new tool for power and water industries, emerson announces support to educational programs at the defence academy of the united kingdom, emerson’s new ovation 4.0 to deliver software-defined, ai-ready automation platform for power and....

Emerson is the global technology, software and engineering powerhouse driving innovation that makes the world healthier, safer, smarter and more sustainable.

• Privacy Notice
• Terms of Use
• Data Protection
• Accessibility
• Communication Preferences
• Report a Vulnerability
• Do Not Sell or Share My Personal Information
• Transparency in Coverage Machine-Readable Files

By selecting a new country/region, product(s) may be unavailable and items in your shopping cart will be removed. Please  contact us  for assistance.

He Was an Online Drug Lord. Now He’s a Crypto Entrepreneur.

After Blake Benthall was arrested for running Silk Road 2.0, the infamous illegal drug bazaar, things didn’t go the way you might expect.

Today, Blake Benthall runs a start-up that aims to help track digital currency transactions. Credit... Gili Benita for The New York Times

Supported by

• Share full article

By Ryan Mac and Kashmir Hill

Ryan Mac and Kashmir Hill covered the takedown of Silk Road 2.0 and Blake Benthall’s arrest a decade ago.

• Published July 24, 2024 Updated July 30, 2024

At a cryptocurrency convention in Austin in May, Blake Emerson Benthall hustled for investor money alongside scores of other entrepreneurs. But none of them, it is safe to say, could pitch their experience as the leader of a multimillion-dollar criminal drug enterprise.

Listen to this article with reporter commentary

In the convention’s “Deal Flow Zone,” Mr. Benthall, 5-foot-4, cleanshaven and wearing a gray tee with his start-up’s logo, turned his laptop around at a lunch table and began giving his spiel to a bespectacled potential investor.

“I’m a lifelong entrepreneur,” Mr. Benthall said as he clicked through a presentation that detailed how he had run Silk Road 2.0 , the second iteration of the infamous online bazaar where 1.7 million anonymous customers signed up and used Bitcoin to buy methamphetamine, heroin and other illegal substances. He recounted his eventual arrest by the F.B.I. and the years he spent in the punitive employ of the federal government.

Now, with his sentence served and probation ended, Mr. Benthall, 36, is promoting a new business: a two-year-old start-up, Fathom(x), which aims to provide businesses and government agencies with software to track digital currency transactions and ensure legal compliance.

Mr. Benthall knows it’s rich for an ex-con to school companies about compliance. But in an industry crawling with hucksters and overnight experts, Mr. Benthall says his criminal experience can help unmask fraud before it leads to another scam like FTX , the now-defunct cryptocurrency exchange whose founder is in prison.

We are having trouble retrieving the article content.

Please enable JavaScript in your browser settings.

Thank you for your patience while we verify access. If you are in Reader mode please exit and  log into  your Times account, or  subscribe  for all of The Times.

Thank you for your patience while we verify access.

Already a subscriber?  Log in .

Want all of The Times?  Subscribe .

Advertisement