FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures...

16
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (date of earliest event reported): May 4, 2020 ENERPAC TOOL GROUP CORP (Exact name of Registrant, as specified in its charter ) Wisconsin 1-11288 39-0168610 (State or other jurisdiction of incorporation) (Commission File Number) (I.R.S. Employer Identification Number) N86 W12500 WESTBROOK CROSSING MENOMONEE FALLS, WISCONSIN 53051 Mailing address: P.O. Box 3241, Milwaukee, Wisconsin 53201 (Address of principal executive offices) (Zip code) Registrant’s telephone number, including area code: (262) 293-1500 Former name or address, if changed since last report: Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Securities registered pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Class A Common Stock, par value $0.20 per share EPAC New York Stock Exchange Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Transcript of FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures...

Page 1: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

UNITED STATESSECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORTPURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported): May 4, 2020

ENERPAC TOOL GROUP CORP(Exact name of Registrant, as specified in its charter)

Wisconsin 1-11288 39-0168610(State or other jurisdiction of incorporation) (Commission File Number) (I.R.S. Employer Identification Number)

N86 W12500 WESTBROOK CROSSINGMENOMONEE FALLS, WISCONSIN 53051

Mailing address: P.O. Box 3241, Milwaukee, Wisconsin 53201(Address of principal executive offices) (Zip code)

Registrant’s telephone number, including area code: (262) 293-1500

Former name or address, if changed since last report:

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (seeGeneral Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered

Class A Common Stock, par value $0.20 per share EPAC New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 ofthe Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financialaccounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Page 2: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Item 7.01 Regulation FD Disclosure

Enerpac Tool Group Corp. (the “Company”) intends to use the materials furnished as Exhibit 99.1 to this Current Report on Form 8-K, which is incorporated by referenceherein, in conjunction with a presentation to be made at a conference on May 5, 2020, which materials will also be posted on the Company’s website, www.enerpac.com.

The information set forth in this Item 7.01 and in Exhibit 99.1 is “furnished” under Item 7.01 of Form 8-K. Such information shall not be deemed “filed” for the purposes ofSection 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended,except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits:

Exhibit Number Description99.1 Enerpac Tool Group Corp. presentation materials dated May 5, 2020104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

Page 3: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto dulyauthorized.

Date: May 4, 2020 ENERPAC TOOL GROUP CORP.

By: /s/ Fabrizio Rasetti Fabrizio Rasetti Executive Vice President, General Counsel and Secretary

Page 4: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Exhibit 99.1 Wells Fargo Industrials & Oppenheimer Industrial Growth Conferences May 5&6, 2020 1

Page 5: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Forward-Looking Statements Statements in this presentation that are not historical are considered “forward-looking statements” and are subject to change based on various factors and uncertainties that may cause actual results to differ significantly from expectations. Those factors are contained in Enerpac Tool Group’s Securities and Exchange Commission filings. All estimates of future performance are as of March 19, 2020. Enerpac Tool Group’s inclusion of these estimates or targets in the presentation is not an update, confirmation, affirmation or disavowal of the estimates or targets. In this presentation certain non-GAAP financial measures may be used. Please see the supplemental financial schedules at the end of this presentation or accompanying the Q2 Fiscal 2020 earnings press release for a reconciliation to the appropriate GAAP measure. 2

Page 6: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Controlling What We Can Control As we progress through the uncertainty and volatility of the dual impacts of COVID-19 and the Oil and Gas shock, we are focused on controlling those things under our control: ▪ Employee Safety and Plant Operations ▪ Cash and Liquidity ▪ Cost measures – permanent and temporary ▪ Capital Allocation ▪ Organic growth strategy execution ▪ Contributing to our communities ▪ Preparing for next phases 3

Page 7: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Controlling What We Can Control – Employee Safety and Plant Operations Employee Safety is #1 Concern ▪ Plants are operating as essential businesses ▪ Split shifts in our plants ▪ Temperatures are monitored and masks are provided at all operating locations ▪ Aggressive cleaning measures ▪ Enforcing social distancing ▪ Non-production personnel are working from home – nearly 2/3 of our employees ▪ We have quickly become adept at effectively working remotely ▪ Focus on collaboration internally and externally ▪ Suspended all travel except when employees are required at customer sites 4

Page 8: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Controlling What We Can Control - Cash and Liquidity Strong Balance Sheet* – We are well positioned Current Debt Structure*: ▪ Leverage at 1.3X • High Yield Bonds: $287M at 5.625% ▪ Interest coverage at 4.02X • Revolver: $400M – nothing drawn; current borrowing rate L+1.375% ▪ Liquidity • Term Loan Accordion**: up to $200M ▪ >$160 million of cash • Additional/Revolver Accordion**: up to $300M ▪ Undrawn Revolver - $400 million ▪ Credit facility covenants – ▪ Net debt/EBITDA of 3.75x with holiday of up to 4.25x ▪ Minimum interest coverage (TTM EBITDA / Annual interest expense) of 3.50x with a 12-month post- divestiture minimum of 3.00x in effect through fiscal 2020, Proactively Managing Capital Structure ▪ Focusing on liquidity preservation, while positioning for long-term growth ▪ Given interest rate environment and flexibility in existing credit facility, evaluating options to reduce interest expense ▪ ~ $20 million in annual interest expense from high yield bonds due 2022 – callable at par June 2020 ▪ Amended the credit facility to extend the 3.00x minimum interest coverage for 12 additional months through fiscal 2021, providing additional flexibility in case of a prolonged downturn 5 *as of 2/28/20 **revolver and term loan can both be increased under existing credit facility

Page 9: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Controlling What We Can Control – Cost structure actions Cost Control Measures ▪ Temporary/COVID-19 related measures generating ~$9M in savings in back half of fiscal 2020: ▪ U.S.-based salaried employees ▪ 2-week furlough ▪ Temporarily suspended 401k match ▪ Suspended fiscal 2020 annual bonus program ▪ Executing on savings for rest of world based on local employment regulations ▪ Participating in foreign government assistance programs as available ▪ Eliminated discretionary spending including non-essential capex ▪ Permanent cost measures - March 2019 announced accelerated actions to eliminate ~$10 million of structural and redundant costs post ECS divestiture ▪ Accelerating Enerpac footprint rationalization ▪ As COVID-19 impacts progress, we will continue to evaluate opportunities for cost reductions more permanent in nature 6

Page 10: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Prioritizing Capital Allocation • Given the volatility in Reduce Debt and Maintain a Strong Balance Sheet the market, our current capital allocation priorities are focused on maintaining a strong balance sheet and financial flexibility Invest in Ourselves to Drive Organic Growth • Investing in ourselves is a key priority • We have suspended repurchases until we have greater clarity Opportunistic Share Buybacks • We will continue to cultivate our M&A pipeline to act opportunistically when our markets stabilize Disciplined M&A within Tool Space 7

Page 11: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Controlling What We Can Control – Organic Growth Initiatives New Product Development (NPD) ▪ Continuing our investment ▪ NPVI greater than 10% through Q2 provides meaningful impact to current conditions ▪ New product launches continue throughout the year – including key products from HTL acquisition 8

Page 12: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Controlling What We Can Control – Organic Growth Initiatives Commercial Effectiveness ▪ Further realignment of commercial team to get closer to customer through March actions ▪ Since COVID-19 ▪ Continued support of our distributors through virtual training and meetings ▪ Supporting markets where demand continues – power generation ▪ Targeted e-commerce and digital marketing programs ▪ Newly launched B2C e-commerce site and enhanced B2B ▪ E-mail marketing campaigns focused new products and promotions ▪ Social media campaigns promoting new products and driving Enerpac awareness 9

Page 13: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Controlling What We Can Control Contributing to our Communities Community Outreach ▪ Continue to support the communities in which we live ▪ Donation of masks to local hospitals ▪ Columbus, WI operations team produced face shields for local health care providers ▪ Cortland, NY team produced masks using existing production materials ▪ Charitable donation to support community initiatives in Milwaukee 10

Page 14: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo

Controlling What We Can Control Preparing for What Comes Next Post-quarantine Preparedness ▪ Employee safety will continue to be our priority ▪ Regional preparedness planning underway to open offices and return to work ▪ Will follow guidelines from local governments ▪ Monitoring supply chains ▪ Production facilities operating safely to meet customer demand 11

Page 15: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo
Page 16: FORM 8-K · Contr olin gW hat We Can Con trol –Co sts ruct re actio ns o stC ontr olM eas ures Tem porary /COV ID -19r elat edm easu res gen ratin g~ $9M ins avin gsi nba ckh alfo