Business Wire | Sep 30, 2020 08:30AM EDT

Enerpac Tool Group Reports Fourth Quarter 2020 Results

Sep. 30, 2020

MILWAUKEE--(BUSINESS WIRE)--Sep. 30, 2020--Enerpac Tool Group Corp. (NYSE: EPAC) (the "Company"), today announced results for its fiscal 2020 fourth quarter ended August 31, 2020.

"Based on our sequential improvements from the third to fourth quarter, we believe our business is beginning to see signs of recovery from the ongoing COVID-19 global pandemic. Our team was able to drive increased commercial activity, which resulted in quarter-over-quarter improvement, and our cost control actions resulted in solid decremental margins as we wrapped up fiscal 2020. During the quarter we remained focused on our top priorities, including keeping our employees safe, supporting our customers, launching new products, diligently managing our costs and maintaining our strong balance sheet," said Randy Baker, Enerpac Tool Group's President and CEO.

Mr. Baker continued, "While the pandemic-driven economic conditions continue to present challenges for our business, the resiliency and performance of our teams across the globe give me confidence that we will achieve our long-term strategic priorities. Our ongoing commitment to and success in new product development continues to contribute positively to our results. In addition, we have demonstrated our ability to quickly take the appropriate actions to respond to changing market dynamics and position Enerpac Tool Group to come out of this pandemic stronger than ever."

Consolidated Results from Continuing Operations

(US$ in millions, except per share)

Three Months Ended Twelve Months Ended

August August August 31, August 31, 31, 31, 2020 2019 2020 2019

Net Sales $111.4 $158.3 $493.3 $654.8

Net Income (Loss) $0.2 ($3.1) $5.6 $8.1

Earnings (Loss) Per Share $0.00 ($0.05) $0.09 $0.13

Adjusted Diluted Earnings Per $0.02 $0.21 $0.18 $0.73Share

* Consolidated net sales from continuing operations for the fourth quarter were $111.4 million compared to $158.3 million in the prior year fourth quarter. Core sales decreased 27% year-over-year, with product sales down 23% and service down 45%. The net impact of acquisitions and divestitures/strategic exits decreased net sales by an additional 4%, and the impact of foreign currency benefited sales 1%. * Fiscal 2020 fourth quarter net income from continuing operations and diluted earnings per share from continuing operations were $0.2 million and $0.00, respectively, compared to a net loss from continuing operations of ($3.1) million and a loss per share from continuing operations of ($0.05) in the fourth quarter of fiscal 2019. Fiscal 2020 fourth quarter net income from continuing operations included: An impairment and divestiture charge of $0.4 million ($0.2 million or $0.00 per share, after tax); Restructuring charges of $1.0 million ($0.8 million or $0.01 per share, after tax), primarily related to the restructuring plan announced in March 2020 to reduce redundant segment and corporate costs; A pension curtailment benefit of $0.8 million ($0.6 million or $0.01 per share, after tax); and Accelerated debt issuance costs of $1.0 million ($0.8 million or $0.01 per share, after tax) related to the early redemption of the Senior Notes. * Fiscal 2019 fourth quarter net income from continuing operations included an impairment and divestiture charge of $8.8 million ($6.9 million or $0.11 per share, after tax) related to the write-down of certain tradenames and customer relationships, restructuring charges of $4.8 million ($6.3 million or $0.10 per share, after tax) related to IT&S restructuring, and $2.7 million ($0.05 per share) of charges primarily related to U.S. tax reform. * Excluding restructuring, impairment & divestiture charges, pension curtailment benefit and accelerated debt issuance costs, adjusted diluted EPS from continuing operations was $0.02 for the fourth quarter of fiscal 2020 compared to $0.21 in the comparable prior year period. * Consolidated net sales for the twelve months ended August 31, 2020 were $493.3 million compared to $654.8 million in the prior year period. Core sales decreased 20% year-over-year, while the net impact of acquisitions and divestitures/strategic exits decreased net sales by 6% and the impact of foreign currency was minimal. * Consolidated net income from continuing operations and EPS for the twelve months ended August 31, 2020 were $5.6 million and $0.09, respectively, compared to net income from continuing operations and EPS of $8.1 million and $0.13, respectively, in the comparable prior year period.

Industrial Tools & Services

(US$ in millions)

Three Months Ended Twelve Months Ended

August 31, August 31, August 31, August 31, 2020 2019 2020 2019

Sales $103.0 $144.6 $454.9 $609.5

Operating Profit $11.3 $13.6 $65.5 $101.4

Adjusted Op Profit ^(1) $12.2 $27.3 $67.3 $116.2

Adjusted Op Profit % ^(1) 11.8% 18.8% 14.8% 19.1%

(1) Excludes $0.5 million of restructuring charges and $0.4 million of impairment and divestiture charges in the fourth quarter of fiscal 2020 compared to $4.8 million of restructuring charges and $8.8 million of impairment and divestiture charges in the three months ended August 31, 2019. The twelve months ended August 31, 2020 excludes $4.5 million of restructuring charges, $3.2 million of net impairment and divestiture gains and $0.4 million of purchase accounting charges compared to $6.0 million of restructuring charges and $8.8 million of impairment and divestiture charges in the twelve months ended August 31, 2019.

* Fourth quarter fiscal 2020 net sales were $103.0 million, 29% lower than the prior fiscal year's fourth quarter. Core sales decreased 26% year-over-year, while the net impact of acquisitions and divestitures/strategic exits decreased net sales 4% and the impact of foreign currency increased sales 1%. * The decrease in revenue is attributable to the decline in demand driven by the COVID-19 pandemic, volatile oil pricing and anticipated year-over-year declines due to strategic exits. * Adjusted operating profit margin of 11.8% in the quarter decreased year-over-year primarily due to reduced volume, partially offset by significant savings from effective cost management.

Corporate Expenses and Income Taxes (excluding restructuring items)

* Corporate expenses from continuing operations for the fourth quarter of fiscal 2020 were $6.2 million, $3.5 million lower than the comparable prior year period, primarily resulting from the impact of restructuring actions, short-term COVID cost actions, lower Board of Director expenses and lower incentive compensation costs. * The fourth quarter effective income tax rate from continuing operations of approximately 51% was higher than the fourth quarter fiscal 2019 rate of approximately (5%).

Discontinued Operations

Discontinued operations represent operating results for the divested EC&S segment through the October 31, 2019 completion date of the divestiture, as well as the ancillary impacts from certain retained liabilities subsequent to the completion date.

Balance Sheet and Leverage

(US$ in millions)

Period Ended

August 31, May 31, August 31, 2020 2020 2019

Cash Balance $152.2 $163.6 $211.2

Debt Balance $255.0 $286.5 $460.4

Net Debt to Adjusted EBITDA** 1.8 1.8 1.7

Net debt at August 31, 2020 was approximately $103 million (total debt of $255 million less $152 million of cash), which decreased approximately $20 million from the prior quarter. Net Debt to Adjusted EBITDA from continuing operations was 1.8x at August 31, 2020.

**Adjusted EBITDA is calculated for the twelve months then ended.

Outlook

Due to the uncertainty and lack of forward visibility into market conditions caused by COVID-19, Enerpac Tool Group is not providing fiscal 2021 guidance at this time.

Mr. Baker said, "As we move into fiscal 2021, we expect to continue to see a sequential uptick in business activity as economies slowly adjust to life in a pandemic across the globe. While we are optimistic that conditions will continue to improve, it remains uncertain when demand will return to normal levels. The actions we have taken to manage through the pandemic have us well positioned to capture demand when it returns, drive growth and profitability and deliver value to shareholders."

Conference Call Information

An investor conference call is scheduled for 10:00 am CT today, September 30, 2020. Webcast information and conference call materials are available on the Enerpac Tool Group company website (www.enerpactoolgroup.com).

Safe Harbor Statement

Certain of the above comments represent forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. Management cautions that these statements are based on current estimates of future performance and are highly dependent upon a variety of factors, which could cause actual results to differ from these estimates. Among other risks and uncertainties, Enerpac Tool Group's results are subject to risks and uncertainties arising from general economic conditions, the COVID-19 pandemic, including the impact of the pandemic or related government responses on the Company's business, the businesses of the Company's customers and vendors, employee mobility, and whether the Company's business and those of its customers and vendors will continue to be treated as "essential" operations under government orders restricting business activities or, even if so treated, whether site-specific health and safety concerns related to COVID-19 might otherwise require operations to be halted for some period of time, volatile oil pricing, variation in demand from customers, the impact of geopolitical activity on the economy, continued market acceptance of the Company's new product introductions, the successful integration of acquisitions, restructuring, operating margin risk due to competitive pricing and operating efficiencies, supply chain risk, material and labor cost increases, tax law changes, foreign currency fluctuations and interest rate risk. See the Company's Form 10-K for the fiscal year ended August 31, 2019 and Form 10-Q for the period ended May 31, 2020 filed with the Securities and Exchange Commission for further information regarding risk factors. Enerpac Tool Group disclaims any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason.

Non-GAAP Financial Information

This press release contains financial measures that are not measures presented in conformity with GAAP. They include EBITDA from continuing operations, adjusted EBITDA from continuing operations, adjusted earnings (loss) from continuing operations, adjusted diluted earnings (loss) per share from continuing operations, adjusted operating profit from continuing operations and net debt. This press release includes reconciliations of these non-GAAP measures to the most comparable GAAP measure, including in the tables attached to this press release. Management believes these non-GAAP measures are commonly used financial measures for investors to evaluate Enerpac Tool Group's operating performance and financial position with respect to the periods presented and, when read in conjunction with the condensed consolidated financial statements, present a useful tool to evaluate ongoing operations and provide investors with metrics they can use to evaluate aspects of the Company's performance from period to period. In addition, these are some of the factors management uses in internal evaluations of the overall performance of the Company's business. Management acknowledges that there are many items that impact a company's reported results and the adjustments reflected in these non-GAAP measures are not intended to present all items that may have impacted these results. In addition, these non-GAAP measures are not necessarily comparable to similarly-titled measures used by other companies.

About Enerpac Tool Group

Enerpac Tool Group Corp. is a premier industrial tools and services company serving a broad and diverse set of customers in more than 90 countries. The Company's businesses are global leaders in high pressure hydraulic tools, controlled force products and solutions for precise positioning of heavy loads that help customers safely and reliably tackle some of the most challenging jobs around the world. The Company was founded in 1910 and is headquartered in Menomonee Falls, Wisconsin. Enerpac Tool Group trades on the NYSE under the symbol EPAC. For further information on Enerpac Tool Group and its businesses, visit the Company's website at www.enerpactoolgroup.com.

Enerpac Tool Group Corp.Condensed Consolidated Balance Sheets(Dollars in thousands)(Unaudited) August 31, August 31,

2020 2019

ASSETSCurrent assetsCash and cash equivalents $ 152,170 $ 211,151

Accounts receivable, net 84,170 125,883

Inventories, net 69,171 77,187

Assets from discontinued operations - 285,578

Other current assets 35,621 30,526

Total current assets 341,132 730,325

Property, plant and equipment, net 61,405 56,729

Goodwill 281,154 260,415

Other intangible assets, net 62,382 52,375

Other long-term assets 78,220 24,430

Total assets $ 824,293 $ 1,124,274

LIABILITIES AND SHAREHOLDERS' EQUITYCurrent liabilitiesTrade accounts payable $ 45,069 $ 76,914

Accrued compensation and benefits 17,793 26,421

Current maturities of debt - 7,500

Income taxes payable 1,937 4,838

Liabilities from discontinued operations - 143,763

Other current liabilities 40,723 40,965

Total current liabilities 105,522 300,401

Long-term debt, net 255,000 452,945

Deferred income taxes 1,708 1,564

Pension and postretirement benefit liabilities 20,190 20,213

Other long-term liabilities 82,647 47,972

Total liabilities 465,067 823,095

Shareholders' equityCapital stock 16,519 16,384

Additional paid-in capital 193,492 181,213

Treasury stock (667,732 ) (640,212 )

Retained earnings 917,671 915,466

Accumulated other comprehensive loss (100,724 ) (171,672 )

Stock held in trust (2,562 ) (3,070 )

Deferred compensation liability 2,562 3,070

Total shareholders' equity 359,226 301,179

Total liabilities and shareholders' equity $ 824,293 $ 1,124,274

Enerpac Tool Group Corp.Condensed Consolidated Statements of Operations(Dollars in thousands, except per share amounts)(Unaudited) Three Months Ended Twelve Months Ended

August 31, August 31, August 31, August 31,

2020 2019 2020 2019

Net sales $ 111,353 $ 158,324 $ 493,292 $ 654,758

Cost of products sold 66,888 89,254 276,099 362,106

Gross profit 44,465 69,070 217,193 292,652

Selling, administrative and 37,672 49,866 180,513 209,231 engineering expensesAmortization of intangible 2,156 1,933 8,323 8,922 assetsRestructuring charges 987 3,025 7,335 4,156

Impairment & divestiture 408 8,796 (3,159 ) 22,827 charges (benefit)Operating profit 3,242 5,450 24,181 47,516

Financing costs, net 3,307 6,563 19,218 28,163

Other (income) expense, net (1,205 ) 394 (2,886 ) 629

Income (loss) before income 1,140 (1,507 ) 7,849 18,724 tax expense Income tax expense 943 1,626 2,292 10,657

Earnings (loss) from 197 (3,133 ) 5,557 8,067 continuing operationsEarnings (loss) from 1,242 (263,731 ) (4,834 ) (257,212 )discontinued operations, netof income taxesNet earnings (loss) $ 1,439 $ (266,864 ) $ 723 $ (249,145 )

Earnings (loss) fromcontinuing operations pershareBasic $ 0.00 $ (0.05 ) $ 0.09 $ 0.13

Diluted 0.00 (0.05 ) 0.09 0.13

Earnings (loss) fromdiscontinued operationsBasic $ 0.02 $ (4.33 ) $ (0.08 ) $ (4.21 )

Diluted 0.02 (4.33 ) (0.08 ) (4.18 )

Earnings (loss) per shareBasic $ 0.02 $ (4.38 ) $ 0.01 $ (4.07 )

Diluted 0.02 (4.38 ) 0.01 (4.04 )

Weighted average commonshares outstandingBasic 59,773 60,907 59,952 61,151

Diluted 60,004 60,907 60,269 61,607

Enerpac Tool Group Corp.Condensed Consolidated Statements of Cash Flows(In thousands)(Unaudited) Three Months Ended Twelve Months Ended

August 31, August 31, August 31, August 31,

2020 2019 2020 2019

Operating ActivitiesCash provided by (used $ 12,544 $ 52,654 $ (3,159 ) $ 53,845 in) operating activities Investing ActivitiesCapital expenditures (2,745 ) (3,036 ) (13,468 ) (26,755 )

Cash paid for business 136 - (33,298 ) - acquisitions, net of cashacquiredProceeds from sale of EC& 2,809 - 212,460 - S segment, net oftransaction costsProceeds from sale of IT& - - 10,226 36,159 S product lines, net oftransaction costsOther investing (62 ) 293 153 1,642 activitiesCash provided by (used 138 (2,743 ) 176,073 11,046 in) investing activities Financing ActivitiesBorrowings on revolver 295,000 - 395,000 -

Redemption of 5.625% (287,559 ) - (287,559 ) - senior notesPrincipal payments on (40,000 ) - (140,000 ) - revolverPrincipal repayments on - (15,000 ) (175,000 ) (72,500 )term loanPayment for redemption of - - - (200,000 )term loanProceeds from issuance of - - - 200,000 term loanPurchase of treasury - (22,481 ) (27,520 ) (22,481 )sharesTaxes paid related to the (76 ) (61 ) (4,286 ) (1,872 )net share settlement ofequity awardsStock option exercises & 107 548 3,092 1,900 otherPayment of cash dividend - - (2,419 ) (2,439 )

Payment of debt issuance - - (234 ) (2,125 )costsCash used in financing (32,528 ) (36,994 ) (238,926 ) (99,517 )activities Effect of exchange rate 8,413 (3,100 ) 7,031 (4,713 )changes on cashNet (decrease) increase (11,433 ) 9,817 (58,981 ) (39,339 )in cash and cashequivalentsCash and cash equivalents 163,603 201,334 211,151 250,490 - beginning of periodCash and cash equivalents $ 152,170 $ 211,151 $ 152,170 $ 211,151 - end of periodEnerpac Tool GroupCorp.Supplemental UnauditedData(Dollars in thousands) Fiscal 2019 Fiscal 2020

Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL

SalesIndustrial Tool & $ 148,655 $ 149,521 $ 166,732 $ 144,607 $ 609,515 $ 135,592 $ 123,361 $ 92,865 $ 103,044 $ 454,863Services SegmentOther 9,896 10,267 11,363 13,717 45,243 11,082 10,025 9,014 8,309 38,429

Total $ 158,551 $ 159,788 $ 178,095 $ 158,324 $ 654,758 $ 146,674 $ 133,386 $ 101,879 $ 111,353 $ 493,292

% Sales GrowthIndustrial Tool & 5 % 9 % 5 % -6 % 3 % -9 % -17 % -44 % -29 % -25 %Services SegmentOther -28 % -12 % -3 % 5 % -10 % 12 % -2 % -21 % -39 % -15 %

Total 2 % 8 % 4 % -5 % 2 % -7 % -17 % -43 % -30 % -25 %

Operating Profit (Loss) from Continuing OperationsIndustrial Tool & $ 26,345 $ 26,596 $ 35,992 $ 27,252 $ 116,185 $ 25,928 $ 20,963 $ 8,228 $ 12,166 $ 67,284 Services SegmentOther (484 ) 1,091 1,787 1,515 3,910 399 (684 ) 21 (1,371 ) (1,635 )

Corporate / General (10,967 ) (11,659 ) (9,481 ) (9,679 ) (41,787 ) (11,342 ) (10,349 ) (8,197 ) (6,158 ) (36,045 )

Adjusted operating $ 14,894 $ 16,028 $ 28,298 $ 19,088 $ 78,308 $ 14,985 $ 9,930 $ 52 $ 4,637 $ 29,604 profitImpairment & (23,477 ) (3,543 ) 12,988 (8,796 ) (22,827 ) 1,356 768 1,443 (408 ) 3,159 divestiture chargesRestructuring & other 29 (46 ) (1,115 ) (4,842 ) (5,973 ) (1,972 ) (1,929 ) (3,292 ) (987 ) (8,179 )exist charges (1)Debt modification - - (288 ) - (288 ) - - - - - chargesPurchase accounting - - - - - - (202 ) (201 ) - (403 )inventory step-upchargeDepreciation & - - (1,704 ) - (1,704 ) - - - - - amortization True up(2)Operating profit (loss) $ (8,554 ) $ 12,439 $ 38,179 $ 5,450 $ 47,516 $ 14,369 $ 8,567 $ (1,998 ) $ 3,242 $ 24,181

Adjusted OperatingProfit %Industrial Tool & 17.7 % 17.8 % 21.6 % 18.8 % 19.1 % 19.1 % 17.0 % 8.9 % 11.8 % 14.8 %Services SegmentOther -4.9 % 10.6 % 15.7 % 11.0 % 8.6 % 3.6 % -6.8 % 0.2 % -16.5 % -4.3 %

Adjusted Operating 9.4 % 10.0 % 15.9 % 12.1 % 12.0 % 10.2 % 7.4 % 0.1 % 4.2 % 6.0 %Profit % EBITDA from Continuing OperationsEarnings (loss) from $ (16,423 ) $ 765 $ 26,858 $ (3,133 ) $ 8,067 $ 6,372 $ 3,918 $ (4,930 ) $ 197 $ 5,557 continuing operationsFinancing costs, net 7,298 7,157 7,146 6,563 28,163 6,729 4,630 4,552 3,307 19,218

Income tax expense 66 4,002 4,962 1,626 10,657 950 806 (407 ) 943 2,292 (benefit)Depreciation & 5,056 4,305 6,109 4,746 20,217 4,779 5,277 5,318 5,347 20,720 amortizationEBITDA $ (4,003 ) $ 16,229 $ 45,075 $ 9,802 $ 67,104 $ 18,830 $ 14,631 $ 4,533 $ 9,794 $ 47,787

Adjusted EBITDA from Continuing Operations (3)Industrial Tool & $ 30,038 $ 30,153 $ 40,015 $ 29,964 $ 130,171 $ 28,996 $ 24,022 $ 11,906 $ 15,938 $ 80,862 Services SegmentOther 337 1,087 1,786 2,395 5,605 1,275 244 926 (449 ) 1,996

Corporate / General (10,930 ) (11,422 ) (8,311 ) (8,919 ) (39,584 ) (10,825 ) (8,272 ) (6,249 ) (5,058 ) (30,406 )

Adjusted EBITDA $ 19,445 $ 19,818 $ 33,490 $ 23,440 $ 96,192 $ 19,446 $ 15,994 $ 6,583 $ 10,431 $ 52,452

Impairment & (23,477 ) (3,543 ) 12,988 (8,796 ) (22,827 ) 1,356 768 1,443 (408 ) 3,159 divestiture chargesRestructuring & other 29 (46 ) (1,115 ) (4,842 ) (5,973 ) (1,972 ) (1,929 ) (3,292 ) (987 ) (8,179 )exist charges (1)Debt modification - - (288 ) - (288 ) - - - - - chargesPurchase accounting - - - - - - (202 ) (201 ) - (403 )inventory step-upchargePension curtailment - - - - - - - - 758 758

EBITDA $ (4,003 ) $ 16,229 $ 45,075 $ 9,802 $ 67,104 $ 18,830 $ 14,631 $ 4,533 $ 9,794 $ 47,787

Adjusted EBITDA %Industrial Tool & 20.2 % 20.2 % 24.0 % 20.7 % 21.4 % 21.4 % 19.5 % 12.8 % 15.5 % 17.8 %Services SegmentOther 3.4 % 10.6 % 15.7 % 17.5 % 12.4 % 11.5 % 2.4 % 10.3 % -5.4 % 5.2 %

Adjusted EBITDA % 12.3 % 12.4 % 18.8 % 14.8 % 14.7 % 13.3 % 12.0 % 6.5 % 9.4 % 10.6 %

Notes:(1) Approximately $1.8 million of the Q4 fiscal 2019 and $0.8 million of the Q3fiscal 2020 restructuring & exit charges were recorded in cost of productssold.(2) Represents the depreciation and amortization expense true up for theCortland business assets that were reclassified out of held for sale in Q3fiscal 2019, as though the assets had never been classified as held for sale.(3) EBITDA represents net earnings (loss) from continuing operations beforefinancing costs, net, income tax (benefit) expense, and depreciation &amortization. EBITDA is not a calculation based upon GAAP. The amounts includedin the EBITDA and Adjusted EBITDA calculation, however, are derived fromamounts included in the Condensed Consolidated Statements of Operations. EBITDAshould not be considered as an alternative to net earnings (loss), operatingprofit (loss) or operating cash flows. The Company has presented EBITDA andadjusted EBITDA because it regularly reviews these performance measures. Inaddition, EBITDA and adjusted EBITDA are used by many of our investors andlenders, and are presented as a convenience to them. The EBITDA and adjustedEBITDA measures presented may not always be comparable to similarly titledmeasures reported by other companies due to differences in the components ofthe calculation.Enerpac Tool Group Corp.Supplemental Unaudited DataReconciliation of GAAP Measures to Non-GAAP Measures(Dollars in thousands, except for per share amounts) Fiscal 2019 Fiscal 2020

Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL

Adjusted Earnings(Loss) (1)Net (Loss) Earnings $ (17,452 ) $ 2,753 $ 32,418 $ (266,864 ) $ (249,145 ) $ 2,121 $ 2,162 $ (4,999 ) $ 1,439 $ 723 (GAAP Measure)Discontinued (1,029 ) 1,988 5,560 (263,731 ) (257,212 ) (4,251 ) (1,756 ) (69 ) 1,242 (4,834 )Operations, net ofincome tax(Loss) Earnings $ (16,423 ) $ 765 $ 26,858 $ (3,133 ) $ 8,067 $ 6,372 $ 3,918 $ (4,930 ) $ 197 $ 5,557 from ContinuingOperationsImpairment & 23,477 3,543 (12,988 ) 8,796 22,827 (1,356 ) (768 ) (1,443 ) 408 (3,159 )divestiture chargesRestructuring & (29 ) 46 1,115 4,842 5,973 1,972 1,929 3,292 987 8,179 other exit chargesAccelerated debt - - 179 - 179 625 - - 1,041 1,666 issuance &modification costsPurchase accounting - - - - - - 202 201 - 403 inventory step-upchargeDepreciation & - - 1,704 - 1,704 - - - - - amortization trueupPension curtailment - - - - - - - - (758 ) (758 )

Net tax effect of (61 ) (194 ) (2,405 ) (464 ) (3,124 ) (52 ) (57 ) (624 ) (503 ) (1,236 )reconciling itemsaboveOther income tax - 3,160 3,076 2,709 8,945 - (74 ) - - (74 )expense (benefit)Adjusted Earnings(Loss) from $ 6,964 $ 7,320 $ 17,539 $ 12,750 $ 44,571 $ 7,561 $ 5,150 $ (3,504 ) $ 1,372 $ 10,578 ContinuingOperations (2) Adjusted Diluted Earnings (loss) per share (1)Net (Loss) Earnings $ (0.29 ) $ 0.04 $ 0.52 $ (4.38 ) $ (4.04 ) $ 0.03 $ 0.04 $ (0.08 ) $ 0.02 $ 0.01 (GAAP Measure)Discontinued (0.02 ) 0.03 0.09 (4.33 ) (4.18 ) (0.07 ) (0.03 ) 0.00 0.02 (0.08 )Operations, net ofincome tax(Loss) Earnings $ (0.27 ) $ 0.01 $ 0.43 $ (0.05 ) $ 0.13 $ 0.11 $ 0.06 $ (0.08 ) $ 0.00 $ 0.09 from ContinuingOperationsImpairment &divestiture 0.38 0.06 (0.21 ) 0.11 0.34 (0.02 ) (0.01 ) (0.02 ) 0.00 (0.04 )charges, net of taxeffectRestructuring & 0.00 0.00 (0.01 ) 0.10 0.09 0.02 0.04 0.04 0.02 0.11 other exit charges,net of tax effectAccelerated debtissuance & - - 0.01 - 0.01 0.01 - - 0.01 0.02 modification costs,net of tax effectPurchase accountinginventory step-up - - - - - - 0.00 0.00 - 0.01 charge, net of taxeffectDepreciation &amortization true - - 0.02 - 0.02 - - - - - up, net of taxeffectPension - - - - - - - - (0.01 ) (0.01 )curtailment, net oftax effectOther income tax - 0.05 0.05 0.05 0.14 - 0.00 - - - expense (benefit)Adjusted DilutedEarnings (Loss) per $ 0.11 $ 0.12 $ 0.29 $ 0.21 $ 0.73 $ 0.12 $ 0.09 $ (0.06 ) $ 0.02 $ 0.18 share fromContinuingOperations (2) Note: The summation of the individual components may not equal the total due torounding and the impact of share dilution on the calculation of the net lossper share and discontinued operations per share.(1) Adjusted earnings (loss) from continuing operations and adjusted dilutedearnings (loss) per share represent net earnings (loss) and diluted earnings(loss) per share per the Condensed Consolidated Statements of Operations net ofcharges or credits for items to be highlighted for comparability purposes.These measures are not calculated based upon generally accepted accountingprinciples (GAAP) and should not be considered as an alternative to netearnings (loss) or diluted earnings (loss) per share or as an indicator of theCompany's operating performance. However, this presentation is important toinvestors for understanding the operating results of the current portfolio ofEnerpac Tool Group companies.(2) Q3 Fiscal 2020 results included an adjusted loss from continuingoperations, therefore adjusted loss per share is not diluted and is, instead,calculated with basic shares. View source version on businesswire.com: https://www.businesswire.com/news/home/20200930005101/en/

CONTACT: Barb Bolens EVP and Chief Strategy Officer 262.293.1562