Badger Meter (BMI) Investor presentation summary

Business overview and strategy

• Over 120 years of innovation in water technology, with a global presence and a focus on smart water solutions integrating hardware and software for advanced insights.

• Values-driven culture emphasizing responsibility, collaboration, customer focus, and continuous improvement, supported by a strong ESG rating and global workforce.

• BlueEdge suite offers comprehensive, customizable solutions for water management, including metering, AMI/software, and beyond-the-meter applications.

• Maintains a leadership position in the water sector through differentiated technologies, proprietary data analytics, and high customer loyalty.

• Strategic capital allocation prioritizes organic growth, shareholder returns, and acquisitions aligned with long-term strategy.

Financial performance and trends

• 2025 sales reached $917M with a 17% CAGR from 2020–2025, 2025 EBITDA at $218M, and free cash flow conversion at 120%.

• Q2 2026 sales were $222.3M, down 7% year-over-year but up 10% sequentially; operating earnings declined 12% year-over-year to $39.4M.

• Gross margin for Q2 2026 was 40.8%, down 30 bps from the prior year; free cash flow for the quarter was $21.9M, reflecting temporary working capital increases.

• Long-term financial outlook targets high single-digit sales growth, 10–15% EPS growth, and over 100% free cash flow conversion.

• Robust cash flow and no outstanding debt, with $96M in cash and a $150M untapped revolver as of June 30, 2026.

Growth drivers and market positioning

• Secular trends such as water demand growth, aging infrastructure, and regulatory requirements drive demand for comprehensive solutions.

• AMI adoption is accelerating, with utilities upgrading to advanced metering and software for efficiency, conservation, and actionable insights.

• Strong market position in North American AMI, offering a broad range of differentiated, tailorable solutions and exceptional customer support.

• Leader in cellular communication for water utilities, providing resilient, secure, and flexible network solutions.

• Growth strategies include expanding smart water and flow instrumentation offerings, leveraging the meter replacement cycle, and international market penetration.