NACCO Industries (NC) 8-K Safe Harbor Statement & Disclosure

2016 Investor Presentation

Exhibit 99

Safe Harbor Statement & Disclosure

2

This

presentation

includes

forward-looking

comments

subject

to

important

risks

and

uncertainties.

It

may

also

contain

financial

measures

that

are

not

in

conformance

with

accounting

principles

generally

accepted

in

the

United

States

of

America

(GAAP).

Refer

to

NACCO’s

reports

filed

on

Forms

8-K

(current),

10-Q

(quarterly),

and

10-K

(annual)

for

information

on

factors

that

could

cause

actual

results

to

differ

materially

from

information

in

this

presentation

and

for

information

reconciling

financial

measures

to

GAAP.

Past

performance

may

not

be

representative

of

future

results.

Guidance

noted

in

the

following

slides

was

effective

as

of

the

company’s

most

recent

earnings

release

and

conference

call

(March

2,

2017).

Nothing

in

this

presentation

should

be

construed

as

reaffirming

or

disaffirming

such

guidance.

This

presentation

is

not

an

offer

to

sell

or

a

solicitation

of

offers

to

buy

any

of

NACCO’s

securities.

3

NACCO Industries Overview

NACCO Industries at a Glance

NACCO Industries, Inc. (NYSE: NC)

Operating holding company with subsidiaries in the

mining, small appliances and specialty retail

industries

Headquartered in Cleveland, Ohio

Approximately 3,600 employees globally

4

NACCO’s strategy is to increase shareholder value by implementing strategic

initiatives designed to achieve long-term profit growth

_____________________

(1)

Adjusted Income is a measure of income that differs from Net Income measured in accordance with GAAP. Adjusted Income is adjusted to exclude Centennial Natural Resources (“Centennial”) which ceased mining operations in December 2015.  Management believes

that Adjusted Income assists the investor in understanding the results of operations of NACCO Industries, Inc. and North American Coal throughout this document and aids in understanding comparability of results. In addition, management evaluates results using this non-

GAAP financial measure.

(2)

Adjusted Income, Adjusted EBITDA and Cash Flow before financing are non-GAAP measures and should not be considered in isolation or as a substitute for GAAP measures. The discussion of non-GAAP items and the related reconciliations to GAAP measures start on

page 48. 

2016 full year highlights:

Revenue –

$856.4 million

Net income –

$29.6 million

Adjusted Income –

$46.8 million

(1)(2)

Cash flow before financing –

$84.1 million

(2)

Adjusted EBITDA –

$76.7 million

(2)

Net debt –

$54.1 million

NACCO Industries Overview

5

Headquartered in Dallas, Texas

2016 full year highlights:

Revenue

–

$111.1

million

Net

income

–

$8.2

million

Adjusted

Income

–

$25.4

million

(1)

Cash

flow

before

financing

–

$31.0

million

(1)

Adjusted

EBITDA

–

$34.3

million

(1)

Employees

–

2,000

(2)

Headquartered in Richmond, Virginia

2016 full year highlights:

Revenue

–

$605.2

million

Net

income

–

$26.6

million

Cash

flow

before

financing

–

$53.9

million

(1)

EBITDA

–

$46.9

million

(1)

Employees

–

600

Headquartered in Chillicothe, Ohio

2016 full year highlights:

Revenue

–

$144.4

million

Net

loss

–

$0.4

million

Cash

flow

before

financing

–

$2.7

million

(1)

EBITDA

–

$1.9

million

(1)

Employees

–

1,000

_____________________

(1)

Adjusted Income, Adjusted EBITDA and Cash Flow before financing are non-GAAP measures and should not be considered in isolation or as a substitute for GAAP measures. The discussion of non-GAAP items and the related reconciliations to GAAP measures start on

page 48. 

(2)

Includes employees of the unconsolidated mines

NACCO Industries Overview (continued)

6

NACCO has significant strengths in its principal businesses:

–

Strong collective earnings and cash flow generation capability

–

Cash flow sustainability and low earnings volatility

–

Significant management expertise in operating each business across a range of economic

conditions

–

Substantial overall cash generation to support growth strategies and objectives and cash

returns to stockholders

NACCO’s Priorities for Use of Cash

Return Cash to Stockholders

Prudent Investments in Complementary Ventures

Investments in Individual Subsidiary Strategic

Initiatives

Reduction of Debt

Investments in Core Subsidiary Businesses

Support strategic initiatives to accelerate growth or enhance margins

Pursue complementary growth opportunities that play to Company

strengths

2014

2015

2016

Annual Dividends

$7.8m

$1.0225/share

$7.3m

$1.045/share

$7.3m

$1.065/share

Stock Repurchase Programs (2011 to 2016)

2011

Program

$35.6 million –

repurchased approximately 624,000 shares of Class

A Common Stock

2013

Program

$60.0 million –

repurchased approximately 1,122,900 shares of

Class A Common Stock

2016 Program

(1)

$6.0 million –

repurchased approximately 109,300 shares of Class A

Common Stock

(1)

The 2016 Stock Repurchase Program provides for the purchase of up to $50 million of the Company’s Class A Common Stock outstanding through December 31, 2017.

7

Ensure subsidiaries are appropriately leveraged

Experienced Management Team

8

Alfred M. Rankin Jr.

Chairman, President and

Chief Executive Officer of

NACCO

Chairman, President and CEO of

NACCO Industries since 1994

Former Vice Chairman, Chief

Operating Officer and Director of

Eaton Corporation

President and Chief

Executive Officer –

NACoal

since 2015

Joined NACCO in

1995

J.C. Butler, Jr.

SVP –

Finance,

Treasurer and Chief

Administrative Officer

of NACCO

VP, General Counsel

and Secretary of

NACoal

Joined NACCO in

2009

Former Jones Day

attorney

John Neumann

VP, General

Counsel and

Secretary of

NACCO

Robert O. Strenski

President of Kitchen

Collection

Elizabeth Loveman

VP and Controller

Previously Director of

Financial Reporting

for NACCO

Joined NACCO in

2012

Gregory Trepp

President and CEO

of Hamilton Beach

Brands

CEO of Kitchen

Collection

President and CEO of

Hamilton Beach

Brands since 2010

Previously VP of

Global Marketing

Joined Hamilton

Beach Brands in 1996

President of Kitchen

Collection since 2015

Previously General

Merchandising

Manager of Kitchen

Collection since 2013

J.C. Butler, Jr.

President and Chief

Executive Officer-

The North American

Coal Corporation

Previously SVP-

Project Development,

Administration and

Mississippi Operations

The History of NACCO Industries, Inc. and Subsidiaries

9

1913

Cleveland & Western

Coal Company is founded

1925

Name changed to The North American

Coal Corporation (NACoal)

1956

NACoal

stock begins

publicly trading over-the-counter

1961

NACoal

is listed on NYSE

1985

NACoal

buys controlling

interest in Yale Materials Handling from Eaton Corporation

1986

NACCO Industries,

Inc. is formed as a new public holding company

1988

NACCO

purchases Proctor Silex, along with Kitchen Collection chain of company outlet stores

1989

NACCO acquires Hyster

Company and, together with Yale, forms NACCO Materials Handling

Group

1990

NACCO acquires

controlling interest of Hamilton Beach, Inc. and merges with Proctor

Silex

2012

NACCO spins off its materials

handling business as Hyster-Yale Materials

Handling (NYSE:HY)

North American Coal Overview

10

North American Coal (“NACoal”) Overview

Mines coal primarily for use in power generation and provides value-added services for natural resource companies

Mines located in North Dakota, Texas, Mississippi, Louisiana and within the Navajo Nation in New Mexico

One of the largest producers of lignite coal in the U.S. and among the ten largest coal producers in the U.S.

1.9 billion tons of lignite coal reserves with 1.0 billion tons committed to current customers

Provides value-added services:

Maintains and operates draglines for independently owned limerock

quarries through its North American Mining division

•

Largest producer of limerock

in Florida

Provides ash-hauling services for power plants and other facilities

Provides coal-handling, processing and drying services

Excellent record of employee safety and environmental responsibility

Unique business model with largely long-term, cost-plus contracts structured to eliminate exposure to market fluctuations

of coal prices

Provides steady income and cash flow with minimal capital investment

Power plants served are generally well positioned to compete within current environmental regulations

11

NACoal’s

Excellent Safety Record

12

2016 NMA Top 20 Coal Producers Ranked by

Incident Rate

*OSHA Incident Rate = Total number of injuries and illnesses multiplied by 200,000 divided by number of hours worked by all employees. The math described can lead to

incident rates below one

2016 National Mining Association (“NMA”)

Top 7 Coal Producers Ranked by Incident

Rate

0.25

0.62

1.18

1.46

2.17

4.31

5.87

Cloud Peak

NACoal

Peabody

Arch

Westmoreland

Alliance

Murray

0.05

0.25

0.62

0.72

0.87

1.18

1.29

2.17

3.64

3.8

4.3

4.31

4.42

4.42

4.64

5.18

5.47

5.87

7.15

1.46

Environmental Responsibility

13

North American Coal has received 80 federal and state awards for

successful and innovative reclamation projects over the last 30 years

NACoal

Operations

14

Unconsolidated Mines

15

NACoal’s

unconsolidated mines operate under long-term cost-plus contracts with

their customers

•

Customer pays 100% of cost of operating the mine

•

Customer

provides,

or

provides

support

for,

all

of

the

capital

required

–

minimal

or

no

NACoal

investment

•

NACoal

is paid a modest agreed profit per ton of coal or heating unit (btu) delivered

Each cost-plus contract specifies the indices and mechanics by which agreed profits change over

time, generally in line with broad measures of U.S. inflation

•

Contracts eliminate exposure to spot coal market price fluctuations

These mines produce strong cash flow with minimal capital requirements

Unconsolidated Mines (continued)

•

Long-term

contracts

expiring

2018

–

2055

•

Pre-tax profits generated from these mines shown separately in the Company’s income

statement as “earnings from unconsolidated mines”

•

Mine-Mouth

operations

–

All

of

the

mines’

production

goes

to

customer

power

plants

or

coal

processing facilities

•

29.5 million tons sold in 2016; up 9.3% from 2015

Full year of deliveries at Camino Real and commencement of production at Coyote Creek in May 2016

16

Consolidated Mine –

Mississippi Lignite Mining Company

Mississippi Lignite Mining Company’s Red Hills Mine supplies coal under a long-term

contract that extends through 2032

o

Delivered 3.0 million tons in 2016

o

Coal produced is sold for use in its customer’s power plant, adjacent to mine

o

Contractually agreed-upon price adjusts monthly primarily based on changes in the

level of established indices, which reflect general U.S. inflation rates, including cost

components such as labor and diesel fuel

Coal sales price is not subject to spot coal market fluctuations

o

NACoal

pays all operating costs and provides the capital for this mine

o

Periodic capital spending required to replace equipment & secure land for future

mining

17

Value-Added Mining Services and Other Income Sources

Maintains and operates draglines for extraction of limerock

at independently owned

limerock

quarries

–

Customers pay all operating costs plus an agreed profit per cubic yard excavated or limerock

delivered

–

NACoal

employees operate equipment owned by the customers

–

26.1 million cubic yards delivered in 2016

Fee-based arrangement to operate a coal drying facility within a power plant operated

by a major coal customer

Ongoing royalty income from rights to coal, oil and gas reserves

–

Ohio, Pennsylvania, North Dakota, Texas, Alabama, Mississippi and Louisiana

18

NACoal

provides value-added mining services for natural resource companies

NACoal

Outlook

Unconsolidated Operations

•

January 1, 2017 -

Bisti

became the contract miner at the Navajo Mine within the Navajo Nation in New Mexico

Target production of ~5-6 million tons annually

•

Tons delivered and income before tax expected to increase at unconsolidated operations as newer mines

increase production and Bisti

commences production

•

Goal of pretax earnings growth at unconsolidated operations of approximately 50% from 2012 level of $45.2

million by 2020-2021, but timing will depend on future inflation rates and customer demand

•

Stable cash flows from long-term contracts

•

Minimal capital investments required

•

Modest contribution from unconsolidated portion of North American Mining

Consolidated Operations

•

Lower, more moderate loss at Centennial

•

Substantial decrease in Royalty & Other Income

•

Anticipated modest decline in customer requirements at consolidated portion of North American Mining

•

Comparable results at MLMC in 2017

•

Strong cash flows and modest capital investments

19

NACoal

Key Strategy Overview

Using a disciplined approach, and using NACoal’s

core cost-plus business

model, pursue:

Additional opportunities to serve as a contract miner in new or existing

coal mining operations

Opportunities in non-coal mining operations, such as aggregates or

other minerals

Opportunities to expand value-added services

20

Strategic initiatives for growth

Seek a minimum return on capital employed of 13%, increase the profitability of all existing mining

operations & achieve income growth from development of new mining and services ventures

NACoal

Operational Highlights

21

(millions of tons)

28.4

29.9

30.2

30.6

32.5

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

2012

2013

2014

2015

2016

Tons of Coal Sold

Cubic

Yards

of

Limerock

Delivered

18.8

22.1

21.0

20.9

26.1

0.0

5.0

10.0

15.0

20.0

25.0

30.0

2012

2013

2014

2015

2016

(millions of cubic yards)

Annual Coal Production from Current Operations 1994 -

2016

22

0

5

10

15

20

25

30

35

1994

1995

1996

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

Other

Coyote Creek

Camino

Red Hills

Sabine

Falkirk

Coteau

Note: the annual coal production of legacy operations (Centennial, San Miguel and Red River) are not included in the chart of annual coal production from current operations above.

NACoal

Financial Highlights

23

Return

on

Capital

Employed

(3)

17.3%

13.0%

-14.9%

3.6%

5.2%

-25%

-15%

-5%

5%

15%

25%

2012

2013

2014

2015

2016

Adjusted Income

(2)

$32.8

$42.2

$28.0

$27.3

$25.4

$0

$20

$40

$60

2012

2013

2014

2015

2016

Cash

Flow

Before

Financing

(3)

($6.1)

($26.7)

($50.2)

$94.4

$31.0

-$75

-$35

$5

$45

$85

2012

2013

2014

2015

2016

($ in millions)

_____________________

(1)

Net

Income

(Loss),

Cash

Flow

Before

Financing

and

Return

on

Capital

Employed

include

non-cash

impairment

charges

of

$4.0

million,

$105.1

million

and

$17.4

million

in

2013,

2014

and

2016,

respectively,

related

to

NACoal’s

Centennial

mining

operations

which

ceased

active mining operations at the end of 2015.

(2)

Adjusted Income is a measure of income that differs from Net Income (Loss) measured in accordance with GAAP. Adjusted Income is adjusted to exclude the results of Centennial.  Management believes that Adjusted Income assists the investor in understanding the

results of operations of North American Coal and aid in understanding comparability of results. 

(3)

Cash flow before financing activities and return on capital employed are non-GAAP measures and should not be considered in isolation or as a substitute for GAAP measures.

Note:  Management evaluates results using these non-GAAP financial measures.  The discussion of non-GAAP items and the related reconciliations to GAAP measures start on page 48.

($ in millions)

Net Income (Loss)

$32.8

$31.9

$(51.0)

$5.6

$8.2

($60)

($40)

($20)

$0

$20

$40

2012

2013

2014

2015

2016

($ in millions)

(1)

(1)

(1)

(1)

(1)

(1)

(1)

(1)

(1)

Hamilton Beach Brands Overview

24

*   Wolf

Gourmet

®

is

a

registered

trademark

of

the

Sub-Zero

Group,

Inc.

**  CHI

®

is

a

registered

trademark

of

Farouk

Systems,

Inc.

*

**

Strong heritage brands with leading market shares

Strong relationships with leading retailers and customers

across diverse channels

Focused emphasis on the quality of products

Successful track record of product line expansion and

new product innovation…we call that Good Thinking

®

Broad consumer price point segmentation coverage  

from Good to Better to Best, with increased focus on

Only-the-Best,

including

Wolf

Gourmet

®

,

Weston

®

,

CHI

®

and Hamilton Beach

®

Professional

Highly professional and experienced management team

Industry-leading working capital management and

strong returns on invested capital

Hamilton Beach Brands (“HBB”) Overview

25

Note -

All product names, logos, and brands are property of their respective owners. Any third party company, product and service names used

in this presentation are for identification purposes only. Use of these names, logos, and brands does not imply endorsement.

HBB Business Highlights

Leading designer, marketer and distributor of:

–

Small electric household and specialty housewares appliances

–

Commercial products for restaurants, bars and hotels

HBB has a leading retail market share position in North America

–

Hamilton Beach

®

brand ranked #1 small kitchen appliance brand in the U.S. (units sold)

–

Strong share in Canada, Mexico & Central America

Powerful heritage brands including Hamilton Beach and Proctor Silex

HBB has been a critical part of life in America for over 100 years

Newer brands, including Weston

®

and Hamilton

Beach

®

Professional,

focused on fast-growing

food trends

Hamilton Beach Commercial and Proctor Silex

Commercial have a reputation for durable, quality

performance in the demanding commercial products industry and are expanding globally

Wolf Gourmet

®

(licensed), a premier brand in large appliances, is available in small appliances,

cookware and cutlery

CHI

®

(licensed),

a

proven

global

leader

in

the

fashion

industry,

is

HBB��s

newest

brand.

A

CHI

®

garment care line will now be available through HBB’s brand portfolio

26

HBB Business Highlights (continued)

Broad product assortment distributed through mass merchants,

national department stores, ecommerce, wholesale distributors

and other retail outlets

HBB

is

investing

shareholder

resources

that

will

generate

a

strong return for years to come

•

Focused on the long term…think and act strategically…

•

Stockholder focused

•

Invest to ensure we have a meaningful “reason for being”

•

Deliver consistent profits and strong return on capital

invested

27

Broad Product Offering

28

Coffeemakers

Slow

Cookers

Irons

Hand Mixers

Blenders

Toaster Ovens

Can Openers

Comprehensive offering of high-quality consumer housewares

Toasters

Kettles

Meat Grinders

Bag Sealers

29

Sao Paulo, Brazil

Sales & Marketin

g

Picton, Ontario, Canada

Distribution Center

Richmond, VA

Headquarters

Sales & Marketing

Engineering

Southern Pines, NC

Customer Call Center and

Refurbishment Center

Olive Branch, MS

Distribution Center

Bentonville, AR

Sales

Tultitlan, Mexico

Distribution Center

Minneapolis, MN

Sales

Miami, Florida

Sales

Jundiai, Brazil

Distribution Center

Markham, Ontario, Canada

Sales & Marketin

g

HBB Global Footprint

Geel, Belgium

Distribution Center

Shenzhen, China

Administration,

Engineering &

Distribution Center

Shanghai, China

Sales , Engineering,

Distribution Center

Mexico City, Mexico

Sales & Marketin

g

Core Business Deliverables

Achieve organizational excellence

–

Attract

and

retain

passionate

talent

to

deliver

Good

Thinking

®

core competency

Pursue market and product development excellence

–

Lead

with

product

innovation

focused

on

Good

Thinking

®

–

Invest in deep understanding of consumer and customer needs

–

Leverage marketing and engineering sales expertise worldwide

to develop innovative solutions

Achieve the highest quality and performance

standards

–

Ensure operational excellence while delivering high-quality

products

–

Maintain a strong, professional engineering and quality-control

staff

30

Ensure best-in-class sourcing and logistics

–

Continually reduce supply chain costs and optimize supply

chain to ensure a sustainable competitive advantage

Enhance long-term partnerships with customers

and suppliers

–

Deliver best-in-class products, brands and support systems

to increase customer presence

–

Maintain industry-leading, professional sales and business

development capabilities

Build brand equity of current brands and

selectively add new brands

–

Strengthen brands through advertising, marketing, and

public relations

HBB Strategic Initiatives

Enhance placements in the North American

consumer business

–

Provide consumer-driven innovative products and strong sales and

marketing support

–

Incremental placements in core business drives scale and drives

incremental profits

Achieve a leadership position in ecommerce

–

Provide best-in-class retailer support and increased consumer

content and engagement

Expand placements in the “only-the-best”, high-end

market with strong brands and broad product lines

–

Robust roadmap of additional product introductions from Wolf

Gourmet

®

scheduled over coming years, through multi-year

agreement with Sub-Zero Group, Inc.

–

Expansion

of

Hamilton

Beach

®

Professional

and

Weston

®

brand

product lines

–

Introduction

of

CHI

®

-branded

garment

care

line,

through

multi-year

licensing deal with Farouk Systems, Inc.

31

Achieve $750 million in sales and a minimum operating profit margin of 10%

The following strategic initiatives have been put in place to achieve HBB’s financial objectives:

Expand internationally in the emerging Asia and

Latin America markets and continue to expand in

Canada and Mexico

–

Understand local consumers’ needs and increase product offerings

designed specifically for those needs

–

Increase international sales to 35 to 45 percent of total sales by

concentrating

on

key

market

s

Achieve further penetration of the global

commercial market through enhanced global

product lines

–

Strengthen food service and hospitality offerings for further market

penetration

–

Build distribution capabilities and resources in the international food

service market

Leverage brands, sourcing, distribution and

ecommerce expertise to achieve category and

channel expansion

HBB International Opportunity

Continue to expand established positions in Mexico,

Canada, Central America and South America

Actively target fast growing China, Brazil and other markets

–

Some of the fastest growing small kitchen appliance markets globally

–

Use an appropriate mix of brands, products, features and price points

to build business with key retailers and commercial customers

–

Invest in developing solutions tailored to local consumer tastes and

needs

–

Increase resources allocated to these markets

–

Work with local partners in certain target countries

Purse other markets by selectively leveraging primarily the

Hamilton Beach

®

and Wolf Gourmet

®

Brands.

32

Planned Sales Mix Evolution

U.S.

80%

International

20%

U.S.

55%

International

45%

2

0

1

6

G

O

A

L

Goal is to shift international sales mix from approximately 20% to 35%-45%

Recent Product Launches Support Market Share Gains

33

xxx

Premium garment care products designed and branded to appeal to consumers

interested in a contemporary design and brand

Includes

a

full

line

of

irons,

all

with

a

titanium

infused

ceramic

soleplate

and

high

steam rates

Includes the Easy Steam steamer bag that easily removes wrinkles in minutes

Perfect for homes that want to use a toaster oven but want better toasting

performance

Saves counter space by combining two appliances into one

Weston

®

products enable consumers to reconnect with real food

The Weston 80 liter and 160 liter dehydrators enable large batches for heavy users

of garden and game dehydrating sessions

Hamilton

Beach

®

coffee

maker

with

automatic

grounds

dispensing

Coffee storage keeps up to 12oz. of ground coffee fresh and ready to dispense

Automatically dispenses number of scoops of coffee into brew basket based on

desired number of cups

Hamilton Beach

®

Coffee Maker  with

Grounds

Dispenser

Weston

®

Pro

Series Dehydrators

Hamilton Beach

®

2-in-1 Toaster   

and Oven

CHI

®

Garment  

Care Line

Recent Product Launches Support Market Share Gains (continued)

34

xxx

Engineered to reduce noise throughout the base and jar

Quiet shield adds additional noise reduction

Great for making smoothies or drinks without the noise levels that traditional

blenders create

Lightweight, ergonomic design helps prevent arm and hand fatigue

Includes a DC motor so mixer runs quieter

Provides a slower first setting to prevent splatter and mess

Smart

Chop

TM

attachment

prevents

over-processing

food

Once chopped to the right size, food passes through attachment and drops into

the lower bowl where it will not be further processed

Perfect for nuts, garlic, onions, celery and more

Engineered to include brushless DC motor to deliver significantly improved

durability and noise reduction

Motor holds higher RPM under load which results in improved blending through

thick ingredients and faster blend times

Hamilton Beach

®

Smart Chop 

3 cup Chopper

Hamilton Beach

®

Ergonomic Hand

Mixer

Hamilton Beach

®

Quiet Blenders

Hamilton Beach

®

Commercial

Quantum Blender

TM

HBB Financial Highlights

35

Operating Profit Margin

Revenue

($ in millions)

($ in millions)

Net Income

$21.2

$25.1

$23.1

$19.7

$26.6

$0

$5

$10

$15

$20

$25

$30

2012

2013

2014

2015

2016

($ in millions)

$35.8

$41.0

$35.8

$34.8

$43.0

$0

$40

$80

2012

2013

2014

2015

2016

Operating Profit

6.9%

7.5%

6.4%

5.6%

7.1%

0%

2%

4%

6%

8%

2012

2013

2014

2015

2016

($ in millions)

$521.6

$547.8

$559.7

$621.0

$605.2

$440

$480

$520

$560

$600

$640

2012

2013

2014

2015

2016

HBB Financial Highlights (continued)

36

Net Working Capital

(1)

Cash Flow Before Financing

(1)

$24.2

$38.5

($10.9)

$9.2

$53.9

-$20

$0

$20

$40

$60

2012

2013

2014

2015

2016

$96.9

$93.5

$110.2

$116.8

$95.1

0%

10%

20%

30%

$0

$50

$100

$150

2012

2013

2014

2015

2016

Net Working Capital

% Revenue

($ in millions)

($ in millions)

Return On Capital Employed

(1)

29.3%

34.9%

28.7%

19.1%

30.5%

0%

10%

20%

30%

40%

2012

2013

2014

2015

2016

($ in millions)

_____________________

(1)

Net working capital, cash flow before financing and return on capital employed are non-GAAP measures and should not be considered in isolation or as a substitute for GAAP measures. For the discussion of non-GAAP items and the related reconciliations to

GAAP measures, see pages starting on 48.

Kitchen Collection Overview

37

Kitchen Collection (“KC”) Overview

A leading specialty retailer of kitchen and related products

in outlet malls

throughout the U.S.

Highly analytical merchandising skills and disciplined

operating controls

Strong

core

Kitchen

Collection

®

store

portfolio

in

outlet

malls

223 stores throughout the U.S. at December 31, 2016

38

Kitchen Collection Locations

39

Meet the challenge of a difficult environment and evolve aggressively in a

constructive manner, focusing on the outlet mall segment

Focus on comparable store sales growth through:

o

Enhancing customers’ store experience through improved customer

interactions to generate greater average sale transaction size

o

Working to enhance sales volume and profitability by improving closure rates

through continued refinement of product offerings, merchandise mix and store

displays and appearances

Optimize store portfolio with Kitchen Collection

®

stores in strong outlet malls in well-

positioned locations and exit stores that do not generate acceptable return

Continue focus on gross margin, profit and cash flow improvement areas

o

Emphasis on increasing sales of higher-margin products

o

Maintain inventory efficiency and store inventory controls

o

Ongoing merchandising improvement through use of highly analytical

merchandising skills and disciplined operating controls

KC Key Strategy Overview

40

Achieve a minimum operating profit margin target of 5%

KC Operational Highlights

41

Sales Per Store

Store Count

($ in thousands)

312

304

248

229

223

0

50

100

150

200

250

300

350

2012

2013

2014

2015

2016

$720.2

$644.7

$679.4

$659.4

$647.5

$0

$250

$500

$750

$1,000

2012

2013

2014

2015

2016

_____________________

(1)

2012, 2013 and 2014 include asset impairment charges of $0.7 million, $1.1 million and $0.9 million, respectively, without which the operating loss would have been $(3.8) million, $(9.8) million and $(6.2) million, respectively.

(2)

Cash flow before financing activities is a non-GAAP measure and should not be considered in isolation or as a substitute for GAAP measures. The discussion of non-GAAP items and the related reconciliations to GAAP measures start on page 48.

KC Financial Highlights

42

Operating Profit (Loss)

Revenue

Net Income (Loss)

$224.7

$196.0

$168.5

$151.0

$144.4

$0

$100

$200

$300

2012

2013

2014

2015

2016

($ in millions)

($4.5)

($10.9)

($7.1)

$0.2

$0.4

($15)

($9)

($3)

$3

$9

2012

2013

2014

2015

2016

(1)

($ in millions)

($ in millions)

($3.1)

($6.9)

($4.6)

($0.4)

($0.4)

($9)

($6)

($3)

$0

$3

2012

2013

2014

2015

2016

Cash Flow Before Financing

(2)

($0.1)

($12.2)

$6.3

$10.8

$2.7

($15)

($10)

($5)

$0

$5

$10

$15

$20

2012

2013

2014

2015

2016

($ in millions)

(1)

(1)

43

NACCO Industries Financial Update

2016 Highlights and Outlook

2016 Results

NACoal

Outlook

NACoal

performed as expected in 2016. While revenues decreased due

to the cessation of coal production at Centennial, net income improved

HBB’s net income increased substantially in 2016 despite a decrease in

revenues primarily due to a shift in sales mix to higher-price and higher-

margin products and lower costs

KC held its small net loss on reduced revenues due to comparable

store sales growth and the closure of unprofitable stores

Expected increase in tons sold and income before

income taxes in 2017 due to the start of production at

Bisti

Fuels and a new limerock

customer’s quarries, and

a full year of mining at Coyote Creek

Centennial loss is expected to moderate in 2017 as it

manages ongoing mine reclamation obligations

Long term

Seeks to maintain or improve the profitability of all

existing mining operations and achieve income growth

from development of new mining and services ventures

($ in thousands)

HBB Outlook

KC Outlook

Expected modest increase in near-term net income as a

result of increased distribution and execution of its

Strategic Initiatives

Long term 

Well-positioned to continue its leadership position in the

small appliance industry

Targeting $750 million in sales and a minimum operating

profit margin of 10%

Revenues expected to decline modestly from 2016 as

KC continues to aggressively manage and reduce store

portfolio

2017 results expected to be comparable to 2016

Long term

Focus on smaller core group of profitable stores

Targeting a minimum operating profit margin of 5%

44

_____________________

(1)

EBITDA is a non-GAAP measures and should not be considered in isolation or as a substitute for GAAP measures. The discussion of non-GAAP items and the related reconciliations to GAAP measures start on page 48.

2016

Full Year

As

Reported

%

Revenue

$856,438

100.0%

Operating Profit

$

41,715

4.9

%

Net Income

$

29,607

3.5

%

Cash Flow from

Operations

$

93,935

Adjusted

EBITDA

(1)

$

76,685

Why Invest in NACCO?

North American Coal has a unique coal business model:

–

Provides

mining

services

primarily

under

long-term

coal

contracts

which

eliminate

NACoal’s

exposure

to

market

fluctuations

of

coal

prices,

providing

steady

income and cash flow

–

Long-standing relationships with high-quality utility customers

–

Highly efficient mining capabilities provide customers with low-cost fuel

–

Diversification via multiple coal and limerock

operations and royalty income

Hamilton Beach Brands is a leading provider of a broad range of consumer housewares:

–

Leading retail market share positions in the small kitchen appliance market in North America

–

Strong heritage brands that resonate with consumers

–

Expansion into additional market segments with Wolf Gourmet

®

and Weston

®

brands

–

Extensive market access through strong relationships with leading retail customers across diverse channels

–

Economies of scale and industry-leading net working capital management drive strong returns on invested capital

Kitchen Collection is a niche market retailer:

–

Focused on outlet mall footprint

–

Wide variety of high-quality and affordable products

–

Cash generator with minimal capital investment

NACCO represents a strong, multi-industry company with leading, well-positioned businesses in mining, small appliances

and specialty retail

NACCO

offers

strong

earnings

and

cash

flow

generation

capability,

with

clear

growth

and

profit

improvement

strategies

and

objectives

across

the

businesses

45

46

Appendix

Risk Factors

47

The risks and uncertainties with respect to each subsidiary’s operations as referenced on page2of this document include, without limitation:

North American Coal: (1) changes in tax laws or regulatory requirements, including changes in mining or power plant emission regulations and health,

safety or environmental legislation, (2) changes in costs related to geological conditions, repairs and maintenance, new equipment and replacement parts,

fuel or other similar items, (3) regulatory actions, changes in mining permit requirements or delays in obtaining mining permits that could affect deliveries to

customers, (4) weather conditions, extended power plant outages or other events that would change the level of customers' coal or limerock requirements, (5)

weather or equipment problems that could affect deliveries to customers, (6) changes in the power industry that would affect demand for North American

Coal's reserves, (7) changes in the costs to reclaim North American Coal mining areas, (8) costs to pursue and develop new mining opportunities, (9)

changes to or termination of a long-term mining contract, or a customer default under a contract, (10) the timing and pricing of transactions to dispose of

assets at the Centennial operations, (11) delays or reductions in coal deliveries at North American Coal's newer mines, and (12) increased competition,

including consolidation within the industry.

Hamilton Beach: (1) changes in the sales prices, product mix or levels of consumer purchases of small electric and specialty housewares appliances, (2)

changes in consumer retail and credit markets, (3) bankruptcy of or loss of major retail customers or suppliers, (4) changes in costs, including transportation

costs, of sourced products, (5) delays in delivery of sourced products, (6) changes in or unavailability of quality or cost effective suppliers, (7) exchange rate

fluctuations, changes in the import tariffs and monetary policies and other changes in the regulatory climate in the countries in which Hamilton Beach buys,

operates and/or sells products, (8) product liability, regulatory actions or other litigation, warranty claims or returns of products, (9) customer acceptance of,

changes in costs of, or delays in the development of new products, (10) increased competition, including consolidation within the industry and (11) changes

mandated by federal, state and other regulation, including tax, health, safety or environmental legislation.

Kitchen Collection: (1) increased competition, including through online channels, (2) shift in consumer shopping patterns, gasoline prices, weather

conditions, the level of consumer confidence and disposable income as a result of economic conditions, unemployment rates or other events or conditions

that may adversely affect the number of customers visiting Kitchen Collection   stores, (3) changes in the sales prices, product mix or levels of consumer

purchases of kitchenware and small electric appliances, (4) changes in costs, including transportation costs, of inventory, (5) delays in delivery or the

unavailability of inventory, (6) customer acceptance of new products, (7) the anticipated impact of the opening of new stores, the ability to renegotiate existing

leases and effectively and efficiently close under-performing stores and (8) changes in the import tariffs and monetary policies and other changes in the

regulatory climate in the countries in which Kitchen Collection buys, operates and/or sells products.

®

Non-GAAP Disclosure

48

NACCO defines non-GAAP measures as follows:

Adjusted EBITDA is defined as net income before income taxes plus interest expense, interest income and depreciation, depletion and

amortization expense;

Net

debt

is

defined

as

total

debt

less

cash

and

cash

equivalents;

Cash flow before financing is defined as net cash from operating activities plus net cash from investing activities;

Return

on

capital

employed

is

defined

as

net

income

before

interest

expense,

after

tax

divided

by

LTM

average

capital

employed.

LTM

average

capital

employed

is

defined

as

LTM

average

equity

plus

LTM

average

debt

less

LTM

average

cash;

and

Net

working

capital

is

defined

as

accounts

receivable

plus

inventories

less

accounts

payable.

For reconciliations from GAAP measurements to non-GAAP measurements see pages 49 to 55.

This presentation contains non-GAAP financial measures. Included in this presentation are reconciliations of these non-GAAP financial

measures to the most directly comparable financial measures calculated in accordance with U.S. generally accepted accounting principles

("GAAP").  Adjusted income and Adjusted EBITDA are measures of net income (loss) that differ from financial results measured in accordance

with GAAP. The adjusted financial measures are U.S. GAAP financial measures adjusted to exclude Centennial.  Adjusted EBITDA, net debt,

cash flow before financing, return on capital employed, net working capital and the adjusted financial measures in this presentation are

provided solely as supplemental non-GAAP disclosures of operating results. Management believes these non-GAAP financial measures assist

investors in understanding the results of operations of NACCO Industries, Inc. and its subsidiaries and aid in understanding comparability of

results.  In addition, management evaluates results using these non-GAAP financial measures. 

Non-GAAP Reconciliations

49

($ in thousands)

Adjusted

EBITDA

reconciliation

–

by

segment

2016  Full Year

North

American

Coal

Hamilton

Beach Brands

Kitchen

Collection

NACCO &

Other

Consolidated

Calculation of  Adjusted  EBITDA

Net income (loss)

$8,244

$26,557

$(355)

$(4,839)

$29,607

Centennial asset impairment charge

17,443

-

-

-

17,443

Income tax provision (benefit)

(8,212)

14,541

455

(1,921)

4,863

Interest expense

4,317

1,165

209

1

5,692

Interest income

(177)

-

-

(19)

(196)

Depreciation, depletion and amortization

expense

12,682

4,681

1,545

368

19,276

Adjusted EBITDA

$34,297

$46,944

$1,854

$(6,410)

$76,685

Note: Adjusted EBITDA in this investor presentation is provided solely as a supplemental disclosure with respect to operating results. Adjusted EBITDA does not represent net income, as defined by U.S. GAAP and should not be considered as a

substitute for net income, or as an indicator of operating performance. NACCO defines Adjusted EBITDA as income (loss) before asset impairment charges and income tax provision (benefit), plus net interest expense and depreciation, depletion and

amortization expense. Adjusted EBITDA is not a measurement under U.S. GAAP and is not necessarily comparable with similarly titled measures of other companies.

Non-GAAP Reconciliations (continued)

50

($ in thousands)

Cash Flow Before Financing

For the Year Ended December 31, 

Hamilton Beach Brands 

2012

2013

2014

2015

2016

Net cash provided by operating activities

$27,390

$40,754

$18,581

$13,941

$58,731

Net cash used for investing activities

(3,215)

(2,278)

(29,516)

(4,775)

(4,788)

Hamilton Beach Brands Cash Flow before Financing

$24,175

$38,476

$(10,935)

$9,166

$53,943

For the Year Ended December 31, 

Kitchen Collection 

2012

2013

2014

2015

2016

Net cash provided by (used for) operating activities

$3,754

$(10,071)

$7,097

     $12,548

     $3,833

Net cash used for investing activities

(3,852)

(2,113)

(792)

(1,768)

(1,137)

Kitchen Collection Cash Flow before Financing

$(98)

$(12,184)

$6,305

$10,780

$2,696

For the Year Ended December 31, 

North American Coal 

2012

2013

2014

2015

2016

Net cash provided by (used for) operating activities 

$50,158

$29,525

$(6,082)

$95,925

$34,940

Net cash used for investing activities 

  (56,320)

(56,185)

(44,143)

(1,512)

(3,916)

North American Coal Cash Flow before Financing

$(6,162)

$(26,660)

$(50,225)

$94,413

$31,024

For the Year Ended December 31, 

Consolidated 

2012

2013

2014

2015

2016

Net cash provided by operating activities 

$74,335

$53,065

$19,799

$108,002

$93,935

Net cash used for investing activities 

  (63,768)

(60,734)

(74,934)

(8,291)

(9,817)

Consolidated Cash Flow before Financing

$10,567

$(7,669)

$(55,135)

$99,711

$84,118

Non-GAAP Reconciliations (continued)

51

($ in thousands)

Net

Working

Capital

–

Hamilton

Beach

Brands

December 31, 

2012

2013

2014

2015

2016

Accounts receivable, net

$94,899

$100,714

$108,908

$100,918

$102,131

Inventories, net

84,814

90,713

104,746

97,511

95,008

Less: Accounts payable

(82,800)

(97,912)

(103,399)

(81,590)

(102,051)

Net Working Capital

$96,913

$93,515

$110,255

$116,839

$95,088

Non-GAAP Reconciliations (continued)

52

($ in thousands)

Return

on

Capital

Employed

–

2012

&

2013

_____________________

(1)

Tax rate of 38% represents the Company's target marginal tax rate compared with 2012's effective income tax rate of 27.3%.

(2)

Tax rate of 38% represents the Company's target marginal tax rate compared with 2013's effective income tax rate of 20.2%.

North

American

Coal

Hamilton

Beach Brands

2012

2012 Average Equity (12/31/2011 and each of 2012’s quarter ends)

$96,132

$35,941

Plus: 2012 Average Debt  (12/31/2011 and each of 2012’s quarter ends)

109,019

45,502

Less: 2012 Average Cash  (12/31/2011 and each of 2012’s quarter ends)

(5,671)

(3,674)

Total 2012 average capital employed

$199,480

$77,769

2012 Net Income

$32,770

$21,200

Plus: 2012 Interest Expense

2,757

2,620

Less: Income taxes on 2012 interest expense at 38%

(1,048)

(1,001)

Return on total capital employed = net income before after-tax interest expense

$34,479

$22,824

Return on total capital employed percentage

17.3%

29.3%

2013

2013 Average Equity (12/31/2012 and each of 2013’s quarter ends)

$121,124

$48,740

Plus: 2013 Average Debt  (12/31/2012 and each of 2013’s quarter ends)

140,267

27,163

Less: 2013 Average Cash  (12/31/2012 and each of 2013’s quarter ends)

(1,242)

(1,779)

Total 2013 average capital employed

$260,149

$74,124

2013 Net Income 

$31,926

$25,093

Plus: 2013 Interest Expense

3,086

1,278

Less: Income taxes on 2013 interest expense at 38%

(1,173)

(486)

Return on total capital employed = net income before after-tax interest expense

$33,839

$25,885

Return on total capital employed percentage

13.0%

34.9%

(2)

(1)

Non-GAAP Reconciliations (continued)

53

North

American

Coal

Hamilton

Beach

Brands

2014

2014 Average Equity (12/31/2013 and each of 2014’s quarter ends)

$139,791

$53,453

Plus: 2014 Average Debt  (12/31/2013 and each of 2014’s quarter ends)

179,841

32,284

Less: 2014 Average Cash  (12/31/2013 and each of 2014’s quarter ends)

(136)

(2,783)

Total 2014 average capital employed

$319,496

$82,954

2014 Net (Loss) income 

$(50,977)

$23,144

Plus: 2014 Interest Expense, net

5,211

1,133

Less: Income taxes on 2014 interest expense at 38% 

(1,980)

(431)

Return on total capital employed = net (loss) income before after-tax

interest expense, net

$(47,746)

$23,846

Return on total capital employed percentage

14.9%

28.7%

2015

2015 Average Equity (12/31/2014 and each of 2015’s quarter ends)

$107,240

$51,541

Plus: 2015 Average Debt  (12/31/2014 and each of 2015’s quarter ends)

132,308

58,870

Less: 2015 Average Cash  (12/31/2014 and each of 2015’s quarter ends)

(2,886)

(1,373)

Total 2015 average capital employed

$236,662

$109,038

2015 Net Income 

$5,619

$19,749

Plus: 2015 Interest Expense, net

4,545

1,775

Less: Income taxes on 2015 interest expense at 38%

(1,727)

(675)

Return on total capital employed = net income before after-tax interest

expense, net

$8,437

$20,849

Return on total capital employed percentage

3.6%

19.1%

($ in thousands)

Return

on

Capital

Employed

–

2014

and

2015

_____________________

(1)

Tax rate of 38% represents the Company's target marginal tax rate compared with 2014's effective income tax rate of 50.2%.

(2)

Tax rate of 38% represents the Company's target marginal tax rate compared with 2015’s effective income tax rate of 11.4%.

(1)

(2)

Non-GAAP Reconciliations (continued)

54

($ in thousands)

Return

on

Capital

Employed

–

2016

_____________________

(1)

Tax rate of 38% represents the Company's target marginal tax rate compared with 2016’s effective income tax rate of 14.1%.

North

American

Coal

Hamilton

Beach

Brands

2016

2016 Average Equity (12/31/2015 and each of 2016’s quarter ends)

$110,554

$51,954

Plus: 2016 Average Debt  (12/31/2015 and each of 2016’s quarter ends)

108,020

40,167

Less: 2016 Average Cash  (12/31/2015 and each of 2016’s quarter ends)

(10,884)

(2,616)

Total 2016 average capital employed

$207,690

$89,505

2016 Net Income

$8,244

$26,557

Plus: 2016 Interest Expense, net

4,140

1,165

Less: Income taxes on 2016 interest expense at 38% 

(1,573)

(443)

Return on total capital employed = net income before after-tax interest

expense, net

$10,811

$27,279

Return on total capital employed percentage

5.2%

30.5%

(1)

NACCO Consolidated Reconciliation “As Reported” to Adjusted

                                                                                                           Year Ended

December 31,

        2016

Reconciliation of Adjusted Income

Net Income, as reported

$29,607

Adjustments to eliminate Centennial

17,159

Adjusted Income

$46,766

Non-GAAP Reconciliations (continued)

55

($ in thousands)

($ in thousands)

_____________________

Adjusted Income is a non-GAAP measure.  Adjusted Income is adjusted for the exclusion of Centennial, including the 2014 asset impairment charge, the 2015 charges associated with the decision to cease mining operations at Centennial and 2016 Centennial asset impairment charge and Alabama legal

settlement.  Management believes  Adjusted Income assists the investor in understanding the results of operations of  NACCO Industries and NACoal and aids in understanding comparability of results.  In addition, management evaluates results using this non-GAAP measure. 

NACoal

Reconciliation “As Reported” to Adjusted

Year Ended December 31

2013

2014

2015

2016

Reconciliation of Adjusted Income

Net Income (Loss), as reported

$31,926

$(50,977)

$  5,619

$  8,244

Adjustments to eliminate Centennial

10,316

78,941

21,684

17,159

Adjusted Income

$42,242

$27,964

$27,303

$25,403