Crane Co. Q2 2020

Earnings Release Call

FORWARD-LOOKING STATEMENTS–DISCLAIMER

This presentation may contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements are based on the management’s current beliefs, expectations, plans, assumptions and objectives regarding Crane Co.’s future financial performance and are subject to significant risks and uncertainties. Any discussions contained in this press release, except to the extent that they contain historical facts, are forward-looking and accordingly involve estimates, assumptions, judgments and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those addressed in these forward-looking statements. Such factors include, among others: uncertainties regarding the extent and duration of the impact of COVID-19 on many aspects of our business; changes in economic, financial and end-market conditions in the markets in which we operate; fluctuations in raw material prices; the financial condition of our customers and suppliers; economic, social and political instability, currency fluctuation and other risks of doing business outside of the United States; competitive pressures, including the need for technology improvement, successful new product development and introduction and any inability to pass increased costs of raw materials to customers; our ability to value and successfully integrate acquisitions, to realize synergies and opportunities for growth and innovation, and to attract and retain highly qualified personnel and key management; a reduction in congressional appropriations that affect defense spending and our ability to predict the timing and award of substantial contracts in our banknote business; adverse effects on our business and results of operations, as a whole, as a result of increases in asbestos claims or the cost of defending and settling such claims; adverse effects as a result of environmental remediation activities, costs, liabilities and related claims; investment performance of our pension plan assets and fluctuations in interest rates, which may affect the amount and timing of future pension plan contributions; and other risks noted in reports that we file with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and subsequent reports filed with the Securities and Exchange Commission. Such reports are available on the Securities Exchange Commission’s website (www.sec.gov). Crane Co. does not undertake to update any forward-looking statements.

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Q2 2020 EARNINGS SUMMARY

Q2 2020 Q2 2019 Change

Sales* $681 $842 (19%)

Operating Profit** $61 $132 (54%)

Operating Margin** 8.9% 15.6% (670 bps)

Earnings per Share** $0.64 $1.58 (60%)

Free Cash Flow*** $106 $137 (22%)

Q2 2020

Core Growth (24.1%)

Acquisitions +6.0%

FX Translation (1.0%)

Total Sales Change (19.1%)

Q2 2020

Diluted EPS: GAAP $0.25

Special Items $0.39

Diluted EPS: non-GAAP** $0.64

Additional Details

* Includes acquisition-related revenue that would otherwise be recognized but for the purchase accounting treatment of acquisitions. Please see non-GAAP Financial Measures tables for details.** Excludes Special Items. Please see non-GAAP Financial Measures tables for details.

*** Free cash flow is defined as cash provided by operating activities less capital spending. Please see non-GAAP Financial Measures tables for details.

$ Millions except per-share amounts

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* Includes acquisition-related deferred revenue in 2020G. Please see non-GAAP Financial Measures tables for details. ** Excludes Special Items. Please see non-GAAP Financial Measures tables for details.

*** Free Cash Flow is defined as Cash Provided by Operating Activities, less Capital Spending. Please see non-GAAP Financial Measures tables for details.**** Reflects midpoint of guidance range.

2020 REVISED GUIDANCE SUMMARY

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$ Millions except per share

amounts2019A Prior 2020G

(April 28, 2020)

New 2020G(July 28, 2020)

Change****(New 2020G vs. 2019A)

Net Sales* $3,283 $2,750-$2,950 $2,800-$2,925 (13%)

Earnings per Share** $6.02 $3.00-$4.25 $3.30-$4.10 (39%)

Free Cash Flow*** $325 $200-$250 $200-$250 (31%)

New 2020G

Core Growth (17%) to (21%)

Acquisitions ~7%

FX Translation (0.5%) to (1%)

Total Sales Change (11%) to (15%)

Other 2020 Guidance Details

◼ Adjusted tax rate of ~21.5%

◼ Corporate expense of ~$61 million

◼ Non-operating expense, net* of ~$39 million

◼ Diluted share count of ~59 million

◼ Capital expenditures of ~$45 million

Only Change vs. April 28, 2020: Narrowed EPS and Net Sales ranges

COVID-19

STRONG LIQUIDITY MAINTAINED THROUGH PRIOR CYCLES

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$ Millions

$232$373 $346 $364 $394

$592

$300

$265$400

$451 $356

$308

2008 2009 2014 2015 2019 June 30, 2020

Cash and equivalents Revolver available*

$532

$638

$746$815

$750

$900Great Recession

Industrial Recession

* Revolver available reduced by CP outstanding

Q2 2020

Core Growth (21.3%)

Acquisitions +5.2%

FX Translation (1.5%)

Total Sales Change (17.7%)

Q2 2020 Q2 2019 Change

Sales $239 $291 (18%)

Operating Profit* $27 $40 (33%)

Operating Margin* 11.2% 13.7% (250 bps)

Backlog** $299 $275 +9%

* Excludes Special Items. Please see non-GAAP Financial Measures tables for details.**Backlog includes $11 million as of June 30, 2020 pertaining to the I&S business acquired in January 2020

FLUID HANDLING

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$ Millions

• Compared to Q1 2020, sequential core (FX neutral and ex-M&A) backlog +2% and orders (14%)

• Compared to Q2 2019, year-over-year core (FX neutral and ex-M&A) backlog +7% and orders down (17%)

Q2 2020 Highlights

Q2 2020

Core Growth (24.8%)

Acquisitions* +11.8%

FX Translation (1.0%)

Total Sales Change (14.0%)

Q2 2020 Q2 2019 Change

Sales* $250 $291 (14%)

Operating Profit** $20 $49 (59%)

Operating Margin** 8.1% 16.9% (880 bps)

* Includes $2.6 million of acquisition-related deferred revenue. Please see non-GAAP Financial Measures tables for details. ** Excludes Special Items. Please see non-GAAP Financial Measures tables for details.

PAYMENT & MERCHANDISING TECHNOLOGIES

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$ Millions

Q2 2020

Core Growth (23.0%)

FX Translation (0.0%)

Total Sales Change (23.0%)

* Excludes Special Items. Please see non-GAAP Financial Measures tables for details.

AEROSPACE & ELECTRONICS

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Q2 2020 Q2 2019 Change

Sales $157 $205 (23%)

Operating Profit* $24 $51 (53%)

Operating Margin* 15.4% 25.0% (960 bps)

Backlog $506 $503 +1%

$ Millions

Q2 2020 Highlights

Q2 2020

OE Sales (20%)

Aftermarket Sales (31%)

OE/Aftermarket Mix 74.5% / 25.5%

ENGINEERED MATERIALS

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Q2 2020 Q2 2019 Change

Sales $34 $56 (40%)

Operating Profit* $2 $8 (68%)

Operating Margin* 7.1% 13.5% (640 bps)

Q2 2020

Core Growth (39.5%)

FX Translation –

Total Sales Change (39.5%)

Q2 2020

Recreational Vehicle Sales (56%)

Building Products Sales (19%)

Transportation Sales (52%)

$ Millions

Q2 2020 Highlights

* Excludes Special Items. Please see non-GAAP Financial Measures tables for details.

* Free cash flow is defined as cash provided by operating activities less capital spending. Please see non-GAAP Financial Measures tables for details. ** Excludes Special Items. Please see non-GAAP Financial Measures tables for details.

CASH FLOW, BALANCE SHEET AND TAX

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Q2 2020 Q2 2019 Better/(Worse)

Cash Provided (used) from Operating Activities $112 $153 ($41)

Capital Expenditures ($6) ($16) $11

Free Cash Flow* $106 $137 ($30)

Effective (GAAP) Tax Rate 21.5% 23.2% 170 bps

Non-GAAP (adjusted) Tax Rate** 23.8% 22.4% (140 bps)

Total Debt $1,428 $948 ($480)

Cash $592 $307 $285

$ Millions

1H 2020 1H 2019 Better/(Worse)

Cash Provided from Operating Activities $77 $53 $24

Capital Expenditures ($14) ($36) $23

Free Cash Flow* $63 $16 $47

NON-GAAP INFORMATION

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NON-GAAP EXPLANATION

Certain non-GAAP measures have been provided to facilitate comparison with the prior year.

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, management believes that non-GAAP financial measures which exclude certain non-recurring items present additional useful comparisons between current results and results in prior operating periods, providing investors with a clearer view of the underlying trends of the business. Management also uses these non-GAAP financial measures in making financial, operating, planning and compensation decisions and in evaluating the Company's performance.

In addition, Free Cash Flow provides supplemental information to assist management and investors in analyzing the Company’s ability to generate liquidity from its operating activities. The measure of Free Cash Flow does not take into consideration certain other non-discretionary cash requirements such as, for example, mandatory principal payments on the Company's long-term debt. Non-GAAP financial measures, which may be inconsistent with similarly captioned measures presented by other companies, should be viewed in addition to, and not as a substitute for, the Company’s reported results prepared in accordance with GAAP.

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NON-GAAP FINANCIAL MEASURES: INCOME ITEMS

Three Months Ended Six Months Ended

INCOME ITEMS June 30, June 30,

2020 2019 2020 2019 Three Months Six Months

Net sales - GAAP 677.9$ 841.6$ 1,475.7$ 1,673.3$ (19.5%) (11.8%)

Acquisition-related deferred revenue 1 2.6 - 5.1 -

Net sales before special items 680.5$ 841.6$ 1,480.8$ 1,673.3$ (19.1%) (11.5%)

Operating proft - GAAP 30.5 122.8 119.1 236.5 (75.2%) (49.6%)

Percentage of sales 4.5% 14.6% 8.1% 14.1%

Special items impacting operating profit:

Acquisition-related deferred revenue 1 2.6 - 5.1 -

Acquisition-related and integration charges 2.3 2.4 7.5 3.5

Repositioning related charges, net 2 25.1 6.4 25.2 11.7

60.5$ 131.6$ 156.9$ 251.7$ (54.0%) (37.7%)

Percentage of sales 8.9% 15.6% 10.6% 15.0%

Net income attributable to common shareholders - GAAP 14.8$ 91.0$ 77.6$ 173.4$ (83.7%) (55.2%)

Per diluted share 0.25$ 1.50$ 1.31$ 2.85$ (83.1%) (54.0%)

Acquisition-related deferred revenue - net of tax 1 1.9 - 3.7 -

Per diluted share 0.03$ 0.06$

Acquisition-related and integration charges - net of tax 1.8 1.6 5.7 2.5

Per diluted share 0.03$ 0.03$ 0.10$ 0.04$

Repositioning related charges, net - net of tax 2 18.8 6.1 19.0 10.3

Per diluted share 0.32$ 0.10$ 0.32$ 0.17$

Unrealized gain on marketable securities - net of tax - (2.5) - (2.5)

Per diluted share (0.04)$ (0.04)$

Deconsolidation of joint venture - net of tax - - - 0.8

Per diluted share 0.01$

37.3$ 96.2$ 106.0$ 184.5$ (61.2%) (42.5%)

Per diluted share 0.64$ 1.58$ 1.79$ 3.04$ (59.7%) (41.0%)

Three Months Ended Six Months Ended

June 30, June 30,

Special items impacting provision for income taxes: 2020 2019 2020 2019

Provision for income taxes - GAAP 4.1$ 27.5$ 21.6$ 49.4$

Tax effect of acquisition-related deferred revenue 1 0.7 - 1.3 -

Tax effect of acquisition-related and integration charges 0.5 0.8 1.8 1.0

Tax effect of repositioning related charges 2 6.3 0.3 6.2 1.4

Tax effect of unrealized loss on marketable securities - (0.7) - (0.7)

Tax effect of deconsolidation of joint venture - - - 0.4

11.6$ 27.9$ 30.9$ 51.5$ 1 Acquis i tion-related revenue that would otherwise be recognized but for the purchase accounting treatment of acquis i tions . 2

Repos i tioning related charges in 2020 primari ly cons is t of COVID-19 related severance and, to a lesser extent, acquis i tion-related repos i tioning and faci l i ty consol idation.

Totals may not sum due to rounding

Provision for income taxes before special items

Special items impacting net income attributable to common shareholders:

Net income attributable to common shareholders before special items

CRANE CO.

Non-GAAP Financial Measures

(in mill ions, except per share data)

Operating profit before special items

Percent Change

NON-GAAP FINANCIAL MEASURES: SEGMENT DATA

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For the three months ended June 30, 2020 Fluid Handling

Payment &

Merchandising

Technologies Aerospace & Electronics Engineered Materials Corporate Total Company

Net sales - GAAP 239.3$ 247.6$ 157.4$ 33.6$ -$ 677.9$

Acquisition-related deferred revenue1 - 2.6 - - - 2.6

Net sales before special items 239.3$ 250.2$ 157.4$ 33.6$ -$ 680.5$

Operating profit (loss) - GAAP 20.2 2.0 19.5 1.8 (13.0) 30.5

Acquisition-related deferred revenue1 - 2.6 - - - 2.6

Acquisition-related and integration charges 1.3 1.0 - - - 2.3

Repositioning related charges, net2 5.2 14.6 4.7 0.6 - 25.1

Operating profit (loss) before special items 26.7$ 20.2$ 24.2$ 2.4$ (13.0)$ 60.5$

Percentage of sales 11.2% 8.1% 15.4% 7.1% 8.9%

For the three months ended June 30, 2019 Fluid Handling

Payment &

Merchandising

Technologies Aerospace & Electronics Engineered Materials Corporate Total Company

Net Sales 290.6$ 291.0$ 204.5$ 55.5$ -$ 841.6$

Operating profit (loss) - GAAP 37.3 46.5 49.4 7.5 (17.9) 122.8

Acquisition-related and integration charges - 0.4 - - 2.0 2.4

Repositioning related charges, net 2.5 2.2 1.7 - - 6.4

Operating Profit before Special Items 39.8$ 49.1$ 51.1$ 7.5$ (15.9)$ 131.6$

Percentage of Sales 13.7% 16.9% 25.0% 13.5% 15.6%

For the six months ended June 30, 2020 Fluid Handling

Payment &

Merchandising

Technologies Aerospace & Electronics Engineered Materials Corporate Total Company

Net sales 495.9$ 544.9$ 350.3$ 84.6$ -$ 1,475.7$

Acquisition-related deferred revenue1 - 5.1 - - - 5.1

Net sales before special items 495.9$ 550.0$ 350.3$ 84.6$ -$ 1,480.8$

Operating profit (loss) - GAAP 48.2 28.4 63.3 8.7 (29.5) 119.1

Acquisition-related deferred revenue1 - 5.1 - - - 5.1

Acquisition-related and integration charges 3.2 4.1 - - 0.2 7.5

Repositioning related charges, net2 6.6 13.3 4.7 0.6 - 25.2

Operating profit (loss) before special items 58.0$ 51.0$ 68.0$ 9.3$ (29.3)$ 156.9$

Percentage of sales 11.7% 9.4% 19.4% 11.1% 10.6%

For the six months ended June 30, 2019 Fluid Handling

Payment &

Merchandising

Technologies Aerospace & Electronics Engineered Materials Corporate Total Company

Net Sales 564.3$ 594.8$ 399.1$ 115.1$ -$ 1,673.3$

Operating profit (loss) - GAAP 71.4 89.7 94.2 16.9 (35.7) 236.5

Acquisition-related and integration charges - 1.5 - - 2.0 3.5

Repositioning related charges, net 4.7 4.8 2.2 - - 11.7

Operating profit (loss) before special items 76.1$ 96.0$ 96.4$ 16.9$ (33.7)$ 251.7$

Percentage of sales 13.5% 16.1% 24.2% 14.7% 15.0%1 Acquis i tion-related revenue that would otherwise be recognized but for the purchase accounting treatment of acquis i tions .

2 Repos i tioning related charges in 2020 primari ly cons is t of COVID-19 related severance and, to a lesser extent, acquis i tion-related repos i tioning and faci l i ty consol idation.

Totals may not sum due to rounding

CRANE CO.

Non-GAAP Financial Measures

(in mill ions)

Segment Information

NON-GAAP FINANCIAL MEASURES: GUIDANCE & CASH FLOW

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Sales Guidance Low High

Sales - GAAP basis $ 2,790 $ 2,915

Acquisition-related deferred revenue1 10 10

Sales - non-GAAP basis 2,800$ 2,925$

2020 Earnings Per Share Guidance Low High Low High

Earnings per share - GAAP basis 2.65$ 3.45$ 0.62$ 0.77$

Repositioning and other 2 0.40 0.40 0.03 0.03

M&A related 3 0.25 0.25 0.05 0.05

Earnings per share - non-GAAP basis 3.30$ 4.10$ 0.70$ 0.85$

1 Acquis i tion-related revenue that would otherwise be recognized but for the purchase accounting treatment of acquis i tions . 2 Repos itioning related charges primari ly cons is t of COVID-19 related severance and, to a lesser extent, acquis i tion-related repos i tioning and faci l i ty consol idation.

3 Includes acquis i tion-related deferred revenue and acquis i tion-related and integration charges .

Three Months Ended Six Months Ended

June 30, June 30,

2020 2019 2020 2019 Low High

Cash provided by operating activities

before asbestos-related payments 119.6$ 161.1$ 95.8$ 70.4$ 295.0$ 345.0$

Asbestos-related payments, net of insurance recoveries (7.5) (8.2) (19.2) (17.9) (50.0) (50.0)

Cash provided by operating activities 112.1 152.9 76.6 52.5 245.0 295.0

Less: Capital expenditures (5.7) (16.3) (13.5) (36.1) (45.0) (45.0)

Free cash flow 106.4$ 136.6$ 63.1$ 16.4$ 200.0$ 250.0$

Totals may not sum due to rounding

2020 Full Year Guidance

CRANE CO.

Guidance

(in mill ions, except per share data)

2020 Full Year Guidance Q3 Guidance

Jason D. Feldman

Vice President of Investor Relations203-363-7329