Corporation Investor Presentation March 2012
Forward Looking Statement Corporation This presentation contains certain forward-looking statements. Forward looking statements relate to future events or the Corporation’s future performance, and are based on management’s current expectations and assumptions regarding the business and anticipated financial results of the Corporation. Forward looking statements involve known and unknown risks, uncertainties and other factors beyond the Corporation’s control which may affect the Corporation’s business, or cause management’s expectations and assumptions to prove incorrect. As a result, actual results of operations could differ materially from those anticipated or implied by forward-looking statements. There can be no assurance any forward- looking statement will materialize. You can find a discussion of risks and uncertainties pertaining to the Corporation and its business and other factors that could cause financial results to fluctuate in our regulatory filings on SEDAR at www.sedar.com. The Corporation assumes no obligation to publicly update or revise its forward-looking statements to reflect new information, events or circumstances, except as required by law. 2
Three Core Businesses 2011 Revenue Corporation Equipment Power Industrial Systems Components 50% 25% 25% 3
2011 Revenue by Region Corporation 117 Branches > 40,000 Customers 4
2011 Revenue by Market Corporation Other Industrial/Commercial Government and Utilities 4% 6% 7% 16% Metal Processing Oil & Gas 13% 14% Construction 11% 11% Oil Sands 9% 9% Mining Forestry Transportation 5
2011 Consolidated Revenue and Earnings Corporation Revenue Earnings Before Tax $ Millions $ Millions $1,377.1 $1,110.9 87.5 $53.9 24% 62% 2010 2011 2010 2011 Earnings Per Share: $3.39 (2010) $3.84 (2011) Debt to EBITDA: 0.70 to 1 (December 31, 2011) 6
Investment Considerations Corporation Dividend Objective: Payout of at least 75% of earnings* Current Monthly Dividend: $0.27 per share Yield: 6.75%-7.0% (based on $46-$48 stock price) Average Annual ROIC: 17.4% - last 5 years (tax effected) Market Cap: $750+ million No shareholder holds ≥ 10% of issued shares * Subject to the Corporation’s financial condition, economic outlook and capital requirements. 7
50% of Total Revenue EQUIPMENT 8
Equipment Product Offering and Growth Strategies Construction Forestry Material Handling JCB Hyster Hitachi Tigercat Growth Strategies Increase equipment market share in key categories – Sales personnel and management effectiveness training Aftermarket parts and service growth – Parts fill rates – Labour efficiencies Branch coverage in key metropolitan areas – Montreal, Edmonton and GTA 9
Equipment Product Offering and Growth Strategies Mining Hitachi Hitachi Townley Estimated Growth Opportunities Market Opportunity Expand support infrastructure in Eastern Canada New products and line extensions – Hitachi 190 tonne and 240 tonne trucks > $500M – Underground mining lines > $400M Expand Rotating Equipment Group in Ft. McMurray > $200M 10
25% of Total Revenue POWER SYSTEMS 11
Power Systems Product Offering and Growth Strategies Applications Electric Power Generation Prime and standby power Growth Strategies Rental market expansion Develop national focus Expand PM contract business Supported by new Drummondville Quebec MTU facility 12
Power Systems Product Offering and Growth Strategies Mechanical Drive Systems MTU Allison Applications Oil and gas exploration and servicing (fracing) Other Off-Highway applications (i.e., marine) Growth Strategies Further develop packaging and integration capabilities Marine opportunities – Gov’t of Canada ship building contracts 13
Power Systems Product Offering and Growth Strategies On-Highway Applications Parts and service for On-Highway Detroit Diesel engines and Allison transmissions 14
25% of Total Revenue INDUSTRIAL COMPONENTS 15
Industrial Components Product Offering Bearings and Hydraulic Components Process Power Transmission and Systems Equipment (SKF, NSK, Timken) (Eaton, Aeroquip, Vickers) (3M, Moyno) 16
Industrial Components Growth Strategies Leverage technical capabilities by expanding higher margin engineering services Sales growth: – Bearings and power transmissions in the west and hydraulics in the east – New branches, product line additions and acquisitions Upgrade e-commerce capability Streamline inventory management and supply chain processes 17
Going Forward Corporation Three areas to focus: 1) Sustaining sales and earnings growth • Base franchise development • New growth opportunities (value-add emphasis) 2) Implementing excellence in Human Resource capabilities • Leadership development • Core teams: sales, technicians, engineers and Branch Managers 3) Inter-related business opportunities • Separate businesses to drive accountability for results, but • Exploit common markets/customers to broaden Wajax share. 18
2012 Outlook Corporation Expect growth in Canadian economy. Global demand for commodities to remain relatively strong. Revenue impact from phasing out LeTourneau mining loader line expected to be mitigated by increased Hitachi mining equipment deliveries. Expect continued growth in revenue and earnings - more modestly than in 2011. Monthly dividend of $0.27 per share March and April 2012. 19
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