Tennant Company (TNC) Investor presentation summary

Strategic positioning and growth drivers

• Holds strong market positions in Americas (25% share), EMEA (14%), and APAC (4%) with significant growth opportunities in each region.

• Differentiated by a world-class service model, disruptive innovation, and a broad product and service portfolio.

• Growth strategy leverages global megatrends: automation, modernization, electrification, and sustainability.

• Focused on high-growth segments such as small-space mechanization and autonomous robotic cleaning.

• Launch of a dedicated robotics group aims to accelerate adoption and scale autonomous cleaning solutions, targeting $250M in AMR net sales by 2028.

Financial performance and impact of ERP transition

• Fourth-quarter 2025 shifted to a net loss, with ERP transition in North America reducing profitability by ~$17M and adjusted EPS by $0.91.

• Full-year 2025 net income and adjusted EPS declined due to lower volumes, margin compression, tariff-related inflation, and ERP disruption.

• Q4 net sales fell 13.9% year-over-year, with Americas down 22.3%, while EMEA and APAC saw modest growth.

• Gross margin dropped 670 bps in Q4 and 250 bps for the year, mainly from ERP disruption and higher material costs.

• Adjusted EBITDA margin decreased to 8.8% in Q4 and 13.9% for the year.

Capital allocation and financial strength

• Maintains a strong balance sheet with net leverage at 1.0x and $374M revolver availability.

• Capital allocation prioritizes investment in innovation, manufacturing optimization, and disciplined M&A.

• $22M in capital expenditures, $59M in ERP modernization, and $41M in R&D investments in 2025.

• Returned $22M in dividends and $88M in share repurchases in 2025.

• Long-term model targets 3–5% organic net sales growth, 50–100bps EBITDA margin expansion, and 100% free cash flow conversion.