cdw investor presentation · •design and optimization services •portfolio management...

CDW INVESTOR PRESENTATION

2020 | SPRING / SUMMER

http://investor.cdw.com/

DISCLAIMERSForward-Looking StatementsStatements in this presentation that are not statements of historical fact are forward-looking statements within

the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including,

without limitation, statements regarding (i) the impact of COVID-19 on CDW's business, operations and liquidity,

and (ii) capital priorities and other strategic plans of CDW. These forward-looking statements are subject to risks

and uncertainties that may cause actual results or events to differ materially from those described in such

statements. Although CDW believes that its plans, intentions and other expectations reflected in or suggested

by such forward-looking statements are reasonable, it can give no assurance that it will achieve those plans,

intentions or expectations. Reference is made to a more complete discussion of forward-looking statements and

applicable risks contained under the captions "Forward-Looking Statements" and "Risk Factors" in CDW's

Annual Report on Form 10-K for the year ended December 31, 2019 and subsequent filings with the SEC,

including in its Prospectus Supplement filed with the SEC on April 17, 2020. CDW undertakes no obligation to

update or revise any of its forward-looking statements, whether as a result of new information, future events or

otherwise, except as otherwise required by law.

Non-GAAP Financial InformationThis presentation contains certain “non-GAAP financial measures,” including Non-GAAP operating income, Non-

GAAP operating income after-tax, Non-GAAP operating income margin, Non-GAAP net income, Non-GAAP net

income per diluted share, and Free cash flow. Generally, a non-GAAP financial measure is a numerical measure

of a company’s performance or financial position that either excludes or includes amounts that are not normally

excluded or included in the most directly comparable measure calculated and presented in accordance with

GAAP. For a reconciliation of non-GAAP financial measures to the applicable most comparable GAAP financial

measures, see the financial statement tables in the Appendix of this presentation and on investor.cdw.com.

Non-GAAP financial measures used by CDW may differ from similar measures used by other companies, even

when similar terms are used to identify such measures.

2 | INVESTOR PRESENTATION

TRACK RECORD OF PROFITABLE GROWTH

1. As of March 31, 2020.

2. 2015 and prior years have not been updated to reflect the adoption of Topic 606.

• Market-leading provider of integrated technologysolutions to business, government, education and healthcare customers for 35+ years

• Coworkers: ~7,800 US and ~2,300 international;~2/3 are customer-facing(1)

• Full range of technology solutions including hardware, software and services

• Offers 100,000+ products and services from 1,000+ brands to more than 250,000 customers in the US, UK and Canada

• “Sweet spot” is customers with <5,000 employees

$8.8$9.6 $10.1

$10.8$12.1

$13.0$13.7

$14.8$16.2

$18.0

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

$353$471 $511 $509

$673$742

$820 $867$987

$1,134

$531$656 $696 $747

$851$961

$1,048$1,107

$1,217

$1,368

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Operating Income Non-GAAP Operating Income

• Attractive business model with demonstrated track record of profitable growth

NET SALES ($B)(2)

OPERATING INCOME ($MM)(2)


CDW COVID-19 RESPONSE

Safeguard the health and well-being of our coworkers

Serve the mission-driven needs of our customers

Support our communities

PRIORITIES ACTIONS

• Activated a cross-functional team led by Executive Committee members• Implemented a global work-from-home order in mid-March• Distribution centers deemed essential – operating under precautionary measures

advised by public health authorities

• Helped organizations work in completely new ways• Enabled healthcare providers to establish mobile virus screening centers and

expand telehealth capabilities• Helped education institutions shift to remote learning solutions • Supported the expansion of first responder capacity at State and Local levels

• Pledged $1 million in donations to support COVID-19 response efforts• Donated to local and global charities to contain and slow the virus• Supported local organizations through virtual volunteering


1. Estimated market share for top 4 publicly traded IT solutions companies: CDW, Insight North America, PC Connection, and e-Plus as of December 31, 2019.2. IDC and CDW internal estimates as of January 2020.3. For year ended December 31, 2019.4. IDC Worldwide Black Book, April 30, 2020, includes Consumer and B2B for US, UK and Canada markets.

Total US, UK and

Canada IT Market(2):

~$1,100B

CDW Current

Addressable Market(2):

~$360B

CDW:

$18B(3)

2015-2020E CAGR IT Spending: 3.2%(4)

CDW plus the next three largest publicly

traded IT solutions companies(1) represent

less than 10% of CDW’s US addressable

market.

The majority of the market is fragmented

across thousands of value-added resellers.

TOTAL ADDRESSABLE MARKET

LARGE AND GROWING MARKET OPPORTUNITY


1. IDC Worldwide Black Book, December 6, 2019.2. IDC/CDW Market Model, December 31, 2019.

4.9%5.3%

7.8%

9.7%

2006-2019 2009-2019

US IT Spending CAGR CDW Net Sales CAGR

290 bps

440 bps

(1)

Indirect60%

Direct40%

Indirect increased

~300 bps since 2007(2)

SUSTAINED MARKET SHARE GAINS ACROSS BUSINESS CYCLES

CONSISTENT, FASTER-THAN-MARKET-GROWTH PARTNERS INCREASINGLY RELIANT ON THE INDIRECT CHANNEL


VALUE TO CUSTOMERS:

• Broad selection of products and multi-branded IT solutions

• Value-added services with integration capabilities

• Highly-skilled specialists and engineers

• Solutions across IT lifecycle

VALUE TO VENDOR PARTNERS:

• Access to more than 250,000 customers

• Large and established customer channels

• Strong distribution and implementation capabilities

• Customer relationships driving insight into

technology roadmaps

INTIMATE KNOWLEDGE

OF IT ENVIRONMENTAND LANDSCAPE

VENDOR

PARTNER VALUE

CUSTOMER

VALUE

CDW Sits Between Customers and Vendor Partners, Creating Value for Both

UNIQUELY POSITIONED TO DELIVER CUSTOMER AND PARTNER VALUE


19%14%

3%7%

30% 29%

-22% -18%

11%3%

-4%

1. 2015 Net sales adjusted to reflect a comparable 2011 Net sales segmentation: (1) US and CDW Canada Net sales only; (2) Advanced Technology Services (ATS) business classified under Other; (3) decrease and increase in Corporate and Small Business, respectively, of $150 million to reflect account moves between the two segments.

’09–’11 CAGR(Other includes ATS & Canada)

+16%

’08–’09 Growth(Other includes ATS & Canada) (11)%

7%

4%6%

11%

8% 8%

’11–’15 CAGR(1)

(Other includes ATS & Canada)

+7%

6% 8% 10%7%

4%’15–’19 CAGR

(Other includes

Canada & CDW UK

Aug 2015 – Dec 2019)

+9%

TOTAL GROWTH

$7.5B

$1.5B$2.5B

$2.4B

$1.9B

$2.2B

Small Business

(<250 employees)

Government

(Federal, State & Local)

Education

(K-12, Higher Ed)

Healthcare

Corporate

(>250 employees)

Other

(UK, Canada)

BALANCED PORTFOLIO OFFERS MULTIPLE GROWTH DRIVERSDIVERSE CUSTOMER CHANNELS AND GEOGRAPHY CREATE MULTIPLE DRIVERS OF GROWTH AND DIVERSIFICATION AGAINST MACRO AND EXOGENOUS HEA DWINDS

2019 NET SALES ($18.0B) NET SALES GROWTH %

0%

27%


MAJOR VENDOR PARTNERS EMERGING VENDOR PARTNERS

CDW IS MISSION-CRITICAL FOR KEY VENDOR PARTNERS


Hardware and Software Products

Monitors

Computers

Printers

Software

Accessories

Storage

Cables

Servers

Networking

Co

mp

lexi

ty /

Pro

du

ctiv

ity

An

d G

row

thB

en

efi

ts

EARLY 2000s NOW

Highly Integrated and Interconnected Technology Ecosystem

Infrastructure Workspace

Support

Security

PROVEN TRACK RECORD OF EVOLVING WITH IT TRENDS

CDW AMPLIFIEDTM

SERVICES


1. As of December 31, 2019.2. Subcomponent of Customer-Facing Coworkers.

~6,800CUSTOMER-FACING

COWORKERS

>3,000TECHNICAL

COWORKERS(2)

HIGHLY SKILLED SERVICES AND SALES CAPABILITIES(1)

NON CUSTOMER–FACING

COWORKERS

100%

0%

50%

SEVICES DELIVERY

PRE-SALE SPECIALISTS

SELLERS

OTHER CUSTOMER-FACING

Our strong technical organization includesmore than 3,000 technical coworkers,including pre-sales specialists and advancedservices delivery engineers, allowing CDWto deliver increasingly complex IT solutions.


CDW AMPLIFIEDTM SERVICES

• Infrastructure Services

• Security Services

• Workspace Services

• Support Services

CLOUD

• Cloud Planning Services

• World Class Portfolio

• Migration, Integration and Managed

DIGITAL WORKSPACE

• Network Solutions

• Consult, Design and Architect

• Communications, Mobility and Productivity

SOFTWARE

• Software Lifecycle Advisory Services

• Design and Optimization Services

• Portfolio Management

• Application Modernization

SECURITY

• Architecture and Design

• Advisory Services

• Managed Security

INFRASTRUCTURE

• Hybrid Consultancy

• Next-Gen Infrastructure

• Software Defined Data Center

BROAD PORTFOLIO OF SOLUTIONS AND SERVICES


With a portfolio of more than

250 cloud offerings, CDW is able

to help customers with private,

public or hybrid cloud solutions.

COMPREHENSIVE SUITE OF CLOUD SOLUTIONS


Able to provide IT solutions to 150+ countries (1)

1. As of December 31, 20192. Includes countries in the trailing 24 months that CDW has exported to or is able to supplement export capabilities with via fulfillment partners.

Located in 10 countries

Able to export to (2)

No presence

INTERNATIONAL PRESENCE TO BETTER SERVE CUSTOMERS



SUSTAINABLE COMPETITIVE ADVANTAGES

Scale and

Scope

SUPERIOR VALUE DIFFERENTIATED GROWTH STRONG ROWC

Highly Engaged

Performance -

Driven Culture

Highly-Skilled

Sales and

Service

Capabilities

Robust

Distribution

Capabilities

Multinational

Footprint With

International

Capabilities

Deep and

Experienced

Management

$86

$199 $247

$314

$410

$504 $570

$606

$794

$902 $817

$917

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Q1'19TTM

Q1'20TTM

Non-GAAP operating income ($MM)

1. 2015 and prior years have not been updated to reflect the adoption of Topic 606.2. Non-GAAP operating income excludes, among other things, charges related to the amortization of acquisition-related intangible assets, equity-based compensation and associated payroll taxes, and acquisition and integration expenses. Non-GAAP operating income margin is

defined as Non-GAAP operating income as a percentage of Net sales.3. Defined as the ratio of total debt at period-end excluding any unamortized discount and/or premium and deferred financing costs, less cash and cash equivalents, to trailing twelve months (TTM) Non-GAAP operating income plus depreciation and amortization in SG&A (excluding

amortization expenses for acquisition-related intangible assets).4. Trailing twelve months.5. Pro forma for recent debt offering. As of March 31, 2020, net leverage ratio was 2.2x. On April 21, 2020, CDW completed the issuance of $600 million aggregate principal amount of 4.125% Senior Notes due 2025 at par, for general corporate purposes.

$8.8$9.6 $10.1

$10.8$12.1

$13.0$13.7

$14.8$16.2

$18.0$16.6

$18.5

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Q1'19TTM

Q1'20TTM

NET SALES $B

$531

$656 $696$747

$851$961

$1,048$1,107

$1,217

$1,368$1,244

$1,385

6.0%

6.8% 6.9% 6.9% 7.1% 7.4% 7.7% 7.5% 7.5% 7.6% 7.5% 7.5%

0.04

0.06

0.08

0.1

0.12

0.14

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Q1'19TTM

Q1'20TTM

OPERATING INCOME AND MARGIN(2)

GAAP operating income ($MM) Non-GAAP Margin (%)

NET INCOME

GAAP net income ($MM)

Non-GAAP net income ($MM) 7.5x

5.7x5.0x

3.9x3.2x 3.2x

2.7x 2.6x 2.3x 2.2x 2.2x

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Q1'20

NET LEVERAGE RATIO(3)

STRONG FINANCIAL PERFORMANCE(1)


(4) (4) (4) (4)

(4) (4)

(5)

1. See Return on Working Capital (ROWC) calculation on page 28.2. Trailing twelve months.

32.5%

41.8%

47.2% 47.8%

51.5% 52.7%54.9% 55.1%

65.0% 65.5%62.1%

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Q1'20 TTM

RO

WC

(%

)

Highly focused on balancing working capital investments to support customers while generating attractive returns on invested capital.

STRONG RETURN ON WORKING CAPITAL(1)


(2)

1. As of March 31, 2020.2. Defined as the ratio of total debt at period-end excluding any unamortized discount and/or premium and deferred financing costs, less cash and cash equivalents, to TTM non-GAAP operating income plus depreciation and amortization in SG&A (excluding amortization expenses

for acquisition-related intangible assets). 3. As of March 31, 2020, net leverage ratio was 2.2x. On April 21, 2020, CDW completed the issuance of $600 million aggregate principal amount of 4.125% Senior Notes due 2025 at par, for general corporate purposes.

Increase Dividends Annually

Maintain Net Leverage Ratio(2)

Supplement Organic Growth with M&A

Return Excess FCF after Dividends &

M&A Through Share Repurchases

OBJECTIVESPRIORITIES 2020 ACTIONS

Target ~25% Payout of Non-GAAP

Net Income; Grow In-line with Earnings

~2.5 to 3.0 Times Net Leverage Ratio

Expand CDW’s Strategic Capabilities

Offset to Incentive Plan Dilution and

to Supplement EPS Growth

Declared Q1’20 dividend on May 6th

2.2x(3) pro forma for recent debt offering

Prioritizing liquidity but will remain

opportunistic

Suspended share repurchase program

CAPITAL ALLOCATION PRIORITIES


• Reassessed capital priorities to enhance liquidity position• Remain confident in liquidity position with $1.2 billion in cash plus revolver availability(1)

1. From IPO through March 31, 2020.

$7

$34

$53

$79

$107

$139

$183

2013 2014 2015 2016 2017 2018 2019

$241

$367

$534 $522

$657

2015 2016 2017 2018 2019

DIVIDENDS PAID ($MM) SHARE REPURCHASES ($MM)

RETURNED MORE THAN $3.1B SINCE 2013(1)


• ~$360B addressable market opportunity with

attractive growth potential

• Clear leader with sustained market share gains in a

highly fragmented market

• Proven ability to evolve and capitalize on IT trends

• Flexible, nimble performance-driven culture

generating a strong financial track record

• Attractive business model with sustainable

competitive advantages

• Multiple levers for growth and creation of shareholder

value

INVESTMENT HIGHLIGHTS


APPENDIX


OUR COMMITMENT TO ESG IN ACTION

10 of 11 Board Members, incl. Chairman, are Independent

45% of Board Members are Women/People of Color

62% of Executive Committee are Women/People of Color

ESG FRAMEWORK AT CDW – IT MATTERS


SUSTAINING ENGAGING INSPIRINGA Successful Business and a Healthy Planet

▪Economic performance ▪Environment

Trust and Confidence in All Our Stakeholders

▪Governance and ethics ▪Customer privacy and data

security

ISO 14001 CertifiedAt all CDW distribution centers

+90% Waste Diversion RateAt US distribution centers in 2019

8 Global Coworker Business Resource Groups

+$9MM in Charitable GivingTo local communities over 5 years1

+$1B Diverse Supplier Spend2

Member of Billion Dollar Roundtable

ENVIRONMENTAL RESPONSIBILITY SOCIAL RESPONSIBLITY LEADERSHIP & GOVERNANCE

Our Coworkers, Communities and Partners

▪Coworkers▪Local communities ▪Supply chain

1. From 2015 through 2019.

2. In 2019, CDW spent over $1 billion with diverse suppliers and was inducted into the Billion Dollar Roundtable, which celebrates companies that have achieved and are committed to spending at least $1 billion with minority and women-owned suppliers annually.


2019-2020 RECOGNITION SNAPSHOT

2020 Best Places to Work

by Glassdoor

America’s Most JUST Companies

2020by JUST Capital

America’s Best Employers for Diversity 2020

by Forbes

Best Companies for Women

by Fairygodboss

Best for Vets Employer

by Military Times

Best Place to Work in IT

by Computerworld

Best of the Best Supplier

Diversity Program by U.S. Veterans

Magazine

Best Technology Companies

by Fairygodboss

Corporate Equality Index Perfect Score

by Human Rights Campaign

Military Friendly Silver Employerby Military Friendly

Most Powerful Women in Business

(President & CEO Christine Leahy) by

Fortune

The Future 50by Fortune

The CDW Way sets forth the shared values that guide our behavior.

We run our business with passion and integrity.

We empower others to do their jobs.

We keep our commitments.

We treat others with respect.

We resolve conflict directly.

We listen.

We include stakeholders in the decision process.

We live our “philosophiesof success” every day.

We make things happen.

NON-GAAP OPERATING INCOME RECONCILIATION: 2010-2015


NON-GAAP OPERATING INCOME RECONCILIATION: 2016-2020


* *

NON-GAAP NET INCOME RECONCILIATION: 2010-2015


NON-GAAP NET INCOME RECONCILIATION: 2016-2020


RETURN ON WORKING CAPITAL CALCULATION


$57

$213

$575

$600

$1,435

$600

$62

$301

$600

$936

2020 2021 2022 2023 2024 2025 2026 2027 2028

DEBT MATURITY PROFILE

As of March 31, 2020(1)

($MM)

$1.45B ABL - Drawn

Senior Notes 5.5% Due 2024

$1.45B ABL - Floorplan


$1.45B ABL - Undrawn

CDW UK Term Loan L+140


CDW UK Revolving Credit - Undrawn

Term Loan L+175 w/No Floor

Weighted Average Rate: 3.9%

Weighted Average Maturity: 5.8 years


1. Pro forma for recent debt offering. On April 21, 2020, CDW completed the issuance of $600 million aggregate principal amount of 4.125% Senior Notes due 2025 at par, for general corporate purposes.


For a copy of this presentation, please access CDW’s investor relations website at:

http://investor.cdw.com/

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