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    Regal Rexnord Corp (RRX)

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    Business Description

    Regal Rexnord Corporation (NYSE: RRX) is a global leader in engineering and manufacturing solutions that power, transmit, and control motion. Headquartered in Milwaukee, Wisconsin, the company specializes in providing sustainable and energy-efficient products and systems to customers across diverse industries, including industrial automation, HVAC, aerospace, and data centers. Regal Rexnord's offerings include electric motors, power transmission components, automation systems, and specialty electrical components, designed to enhance operational efficiency and sustainability.

    1. Industrial Powertrain Solutions (IPS) - Designs, produces, and services highly engineered power transmission products, including mounted and unmounted bearings, couplings, gearboxes, gear motors, clutches, brakes, and industrial powertrain components. Serves markets such as general industrial, metals and mining, agriculture, construction, food and beverage, energy, and alternative energy.

    2. Power Efficiency Solutions (PES) - Specializes in fractional to approximately 5 horsepower AC and DC motors, electronic variable speed controls, electronic drives, fans, blowers, and integrated subsystems. Applications include residential and light commercial HVAC, water heaters, commercial refrigeration, building ventilation, pool and spa, irrigation, and agricultural uses.

    3. Automation & Motion Control (AMC) - Focuses on conveyor products, conveying automation subsystems, aerospace components, precision motion control solutions, miniature servo motors, controls, drives, and linear actuators. Also provides power management products like automatic transfer switches and paralleling switchgear for industrial automation, robotics, aerospace, medical, and data center markets.

    4. Industrial Systems - Designed and produced integral motors, alternators, switchgear, and transfer switches for industrial applications. Served markets including agriculture, marine, mining, oil and gas, food and beverage, data centers, and healthcare. The majority of this segment was divested on April 30, 2024.

    Key Metrics

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    Executive Team

    NamePositionStart DateShort Bio
    Louis V. PinkhamChief Executive OfficerApril 2019Joined RRX as CEO in April 2019. Previously held leadership roles at Crane Co., Eaton Corporation, ITT Sherotec, and Molecular Biosystems, Inc. Holds degrees from Duke and Northwestern Universities.
    Robert J. RehardExecutive Vice President, Chief Financial OfficerJanuary 2015Joined RRX as VP, Corporate Controller, and Principal Accounting Officer in January 2015. Promoted to CFO in April 2018. Previously held financial leadership roles at Eaton, Baxter, Emerson, Masco, and Cooper.
    Thomas E. ValentynExecutive Vice President (Transitional Role)December 2013Joined RRX as Associate General Counsel in December 2013. Became General Counsel in May 2016. Transitioning to retirement, with a transitional role until July 12, 2024.
    Tim A. DicksonSenior Vice President, Chief Digital & Information OfficerOctober 2023Joined RRX in October 2023. Previously served as CIO at Generac Power Systems and held leadership roles at Astreya, Laureate International Universities, Motorola Solutions, Dell, and IBM.
    Cheryl A. LewisExecutive Vice President, Chief Human Resources OfficerMarch 2020Joined RRX in March 2020. Previously held HR leadership roles at Illinois Tool Works, Alcan Packaging, and Panduit Corporation.
    Brooke E. LangExecutive Vice President & President, Power Efficiency Solutions SegmentJuly 2022Joined RRX in July 2022. Previously held various roles at Eaton, including VP and General Manager of the Power Components Division.
    Jerrald R. MortonExecutive Vice President & President, Industrial Powertrain SolutionsFebruary 2015Joined RRX in February 2015 as part of Emerson's Power Transmission Solutions acquisition. Held various leadership roles and assumed his current role in March 2023.
    Kevin J. ZabaExecutive Vice President & President, Automation & Motion ControlOctober 2021Joined RRX in October 2021. Became President of Automation & Motion Control in March 2023 after the Altra Industrial Motion acquisition. Previously held leadership roles at Rockwell Automation.
    Hugo Dubovoy, Jr.Executive Vice President, General Counsel, and Corporate SecretaryApril 23, 2024 (expected)Appointed EVP, General Counsel, and Corporate Secretary effective April 23, 2024, following the retirement of Thomas E. Valentyn. Previously held other leadership roles within RRX.

    Questions to Ask Management

    1. Given the ongoing uncertainties in the market and the company's expectation of limited organic growth in 2025 , what specific strategies is management implementing to drive growth and mitigate these headwinds?

    2. With the challenges faced in ramping up capacity to meet the surge in residential HVAC demand , how is the company improving its demand forecasting and supply chain coordination to prevent future delays and potential loss of market share ?

    3. The European and Chinese markets continue to experience pressures with ISM below 50 and no significant improvement expected in 2025. How does the company plan to offset these headwinds and drive growth in these regions?

    4. Free cash flow was disappointing this year due to timing differences, yet management expects to exit next year at an annualized rate of $1 billion. What gives you confidence in achieving this target, and what are the key risks that could prevent you from reaching it?

    5. With the shift in AMC towards longer-cycle projects and extended backlogs, leading to a larger spread between orders and revenue growth , how is management addressing potential revenue realization delays and what steps are being taken to synchronize orders and revenue growth more effectively?

    Share Repurchase Program

    Program DetailsProgram 1
    Approval DateOctober 26, 2021
    End Date/DurationNo expiration date
    Total Additional Amount$500.0 million
    Remaining Authorization$145.0 million as of September 30, 2024
    DetailsAuthorized by the Board of Directors; no expiration date