Capital Allocation & Investment ROI Tracking

Pinnacle Precision Industries • Portfolio Overview Q4 2024

Portfolio ROIC
11.4%
+1.6% YoY
ROIC vs. WACC Spread
+1.6%
Value creating
Portfolio NPV
$18.2M
-$4.1M vs. plan
Capex Efficiency
0.87
87¢ per $1 deployed
Projects Below Hurdle
4 / 14
Requires review
M&A EBITDA Capture
76.3%
-13.7% vs. model

Capital Portfolio: IRR vs. WACC Spread

Above hurdle (+200bps)
On target (±200bps)
Below hurdle (-200bps)
Bubble size = Capital deployed ($M)

IRR Distribution by Project Category

Growth vs. Maintenance Capex

Invested Capital Turns

2.3x
Revenue / Invested Capital

Capital Reallocation Velocity

142 days
Avg. time to reallocate

Asset Impairment Risk

6.8
Risk score (0-10 scale)
High

M&A Integration: Greenfield Precision Acquisition

Purchase Price
$28.0M
EBITDA Capture
76.3%
vs. 90% model
Revenue Attrition
$4.1M
2 key accounts lost
Integration Days
263
Q1 2024 close

Strategic Initiative Milestones

Automation Line Expansion
7 of 9 milestones complete
78%
ERP System Upgrade
5 of 7 milestones complete
71%
Facility Consolidation
3 of 6 milestones complete
50%
Product Line Rationalization
6 of 8 milestones complete
75%
Supply Chain Optimization
4 of 5 milestones complete
80%

ROIC vs. WACC Trend (12 months)

Capital Project Detail

Project Name Category Capital Approved IRR Current IRR Variance Status
Automation Line B Expansion Growth $12.4M 14.2% 15.8% +1.6% On track
Greenfield Precision Acq. M&A $28.0M 16.5% 11.2% -5.3% Below hurdle
ERP Platform Upgrade Digital $8.7M 18.1% 17.4% -0.7% On target
Legacy Machinery Line A Maintenance $6.2M 11.5% 6.2% -5.3% Impairment risk
Facility Consolidation — East Efficiency $9.3M 13.7% 14.9% +1.2% On track
R&D Lab Modernization Growth $5.1M 15.3% 16.8% +1.5% On track
Supply Chain Software Digital $3.8M 19.2% 18.6% -0.6% On target
Warehouse Automation Efficiency $7.9M 12.4% 9.1% -3.3% Below hurdle

Capex Efficiency Ratio (12 months)

Productive asset value / Capital deployed. Target: ≥0.85

Project Risk Heatmap

Low Risk
Medium Risk
High Risk
Execution
4
6
4
Market
6
5
3
Financial
5
4
5
Number of projects by risk category