Axalta Coating Systems Ltd. · NYSE:AXTA
Axalta Coating Systems — Q1 2021 Earnings Presentation
20 slides from Axalta Coating Systems's earnings presentation, Apr 26, 2021
Slide 1: Q1 2021 Financial Results
Q1 2021 Financial Results April 26, 2021 1
Slide 2: Legal Notices
Legal Notices Forward-Looking Statements This presentation and the oral remarks made in connection herewith may contain certain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 regarding Axalta and its subsidiaries including our outlook, whic
Slide 3: Introduction and Q1 Financial Highlights
Introduction and Q1 Financial Highlights First Quarter 2021 Highlights ▪ Q1 2021 net sales increased 8.1% year-over-year to $1,064 million with positive contributions from all end-markets ▪ Income from operations of $53 million includes a significant operating charge; Adjusted EBIT increased 37.8% t
Slide 4: Q1 Consolidated Results
Q1 Consolidated Results Financial Performance Commentary ($ in millions, except Q1 % Change per share data) 2021 2020 Incl. F/X Excl. F/X Net sales increased YOY from continued volume Performance Coatings 707 648 9.2 % 5.0 % recovery; China lapping Q1 2020 COVID impacts Mobility Coatings 356 336 6.1
Slide 5: Q1 Performance Coatings Results
Q1 Performance Coatings Results Financial Performance Commentary Q1 % Change ($ in millions) 2021 2020 Incl. F/X Excl. F/X Stronger net sales driven by both Refinish and Industrial volume improvement Refinish 399 368 8.5 % 3.7 % ▪ YOY volume growth driven by continued Industrial Industrial 308 280 1
Slide 6: Performance Coatings Demand Environment
Performance Coatings Demand Environment Refinish ▪ The refinish market in Q1 was variable but improved later in the period, particularly in North America ▪ Traffic indicators improving from bottom in January: – U.S. miles driven down ~7%, body shop activity down ~12%; insurance claims continue to la
Slide 7: Q1 Mobility Coatings Results
Q1 Mobility Coatings Results Financial Performance Commentary Q1 % Change ($ in millions) 2021 2020 Incl. F/X Excl. F/X Net sales growth driven by improved price-mix, low single digit volume growth, and FX benefit Light Vehicle 279 260 7.2 % 5.4 % ▪ Volume improvement driven by recovery in China Lig
Slide 8: Mobility Coatings Demand Environment
Mobility Coatings Demand Environment Light Vehicle ▪ LV market recovery continued in Q1 globally with solid retail demand, though the semiconductor chip shortage has delayed ~2 million production units globally from 1H 2021 with much expected to be made up in 2H 2021 ▪ U.S. auto retail sales of 17.7
Slide 9: Debt and Liquidity Summary
Debt and Liquidity Summary Capitalization Commentary ($ in millions) Interest @ 3/31/2021 Maturity ▪ Net leverage of 3.2x at March 31, 2021 improved Cash and Cash Equivalents $ 1,267 from 3.3x at December 31, 2020 driven by Debt: increased LTM Adjusted EBITDA Revolver ($400 million capacity)(1) Vari
Slide 10: Financial Guidance Update
Financial Guidance Update Full Year 2021 Guidance: Q2 2021 Guidance: ▪ Net Sales: ~+20-22%, including ~3% FX and ▪ Adjusted EBIT: ~23% of FY expected for Q2 ~1% M&A benefit ▪ Raw material inflation expected to ramp up ▪ Adjusted EBIT: $715-755 million beginning in Q2 ▪ Headwind from year-over-year l
Slide 11: Appendix
Appendix AXALTA COATING SYSTEMS
Slide 12: Full Year 2021 Assumptions
Full Year 2021 Assumptions Macroeconomic Assumptions Currency Assumptions ▪ Global GDP growth of ~10.2% for Q2 2021 and ~5.3% for FY 2021 2021 Average 2020 % Axalta 2020 Average USD % Impact of Currency Rate ▪ Global industrial production growth of ~16.2% Net Sales Rate FX Rate Change Assumption for
Slide 13: Adjusted EBIT Reconciliation
Adjusted EBIT Reconciliation ($ in millions) Q1 2021 Q1 2020 Income from operations $ 52.6 $ 65.1 Other (income) expense, net (0.4) 0.8 Total $ 53.0 $ 64.3 A Debt extinguishment and refinancing related costs — 2.4 B Termination benefits and other employee related costs 2.8 19.5 C Strategic review an
Slide 14: Adjusted EBIT Reconciliation (cont'd)
Adjusted EBIT Reconciliation (cont’d) A Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which are not considered indicative of our ongoing operating performance. B Represents expenses and associated changes to est
Slide 15: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation ($ in millions, except per share data) Q1 2021 Q1 2020 Net income $ 15.7 $ 52.4 Less: Net income attributable to noncontrolling interests 0.5 0.2 Net income attributable to controlling interests $ 15.2 $ 52.2 A Debt extinguishment and refinancing related costs — 2.
Slide 16: Adjusted Net Income Reconciliation (cont'd)
Adjusted Net Income Reconciliation (cont’d) A Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which are not considered indicative of our ongoing operating performance. B Represents expenses and associated changes
Slide 17: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation ($ in millions) Q1 2021 Q1 2020 Cash provided by (used for) operating activities $ 39.6 (0.8) Purchase of property, plant and equipment (31.8) (22.7) Interest proceeds on swaps designated as net investment hedges 3.5 3.7 Free cash flow $ 11.3 (19.8) 17
Slide 18: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation LTM ($ in millions) 3/31/2021 Q1 2021 Q1 2020 FY 2020 Net income $ 85.3 $ 15.7 $ 52.4 $ 122.0 Interest expense, net 146.9 33.5 36.5 149.9 Provision (benefit) for income taxes 28.6 3.8 (24.6) 0.2 Depreciation and amortization 310.1 76.4 86.6 320.3 EBITDA $ 570.9 $ 129.4
Slide 19: Adjusted EBITDA Reconciliation (cont'd)
Adjusted EBITDA Reconciliation (cont’d) A Represents expenses and associated changes to estimates related to the prepayment, restructuring, and refinancing of our indebtedness, which are not considered indicative of our ongoing operating performance. B Represents expenses and associated changes to e
Slide 20: Thank you
Thank you Investor Relations Contact: Chris Mecray Christopher.Mecray@axalta.com 215-255-7970 20
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