Blue Bird Corporation · NASDAQ:BLBD
Blue Bird — 30th Annual Roth Conference (March 2018)
30 slides from Blue Bird's conference presentation, Mar 12, 2018
Slide 1: 30th Annual Roth Conference
Blue Bird Corporation 30th Annual Roth Conference March 12, 2018 Orange County, CA
Slide 2: Agenda
Agenda School Bus Industry Overview Blue Bird Highlights Financial Overview 2
Slide 3: School Bus Industry Overview
School Bus Industry Overview 3
Slide 4: Industry Highlights
Industry Highlights OEMs Thomas Blue Bird 590,000 IC School Bus Customers Attractive Industry Attributes ~3,400 High barriers to entry Contractors Highly specialized product Complex state and customer requirements Dealer and service network Customer relationship driven business ~10,000 Demand Driver
Slide 5: School Bus Industry Products
School Bus Industry Products Type C Buses Type D FE Buses (Conventional) (Front Engine, Transit-Style) Seating Capacity: 36-83 Seating Capacity: 54-90 Fuel Types: Diesel, Propane, CNG, Gasoline, Fuel Type: Diesel Electric (2018) Type D RE Buses Type A Buses (Rear Engine, Transit-Style) Seating Capac
Slide 6: Type C & D School Bus Industry
Type C & D School Bus Industry 40 37,600 Thousands 34,900 35,200 35 Mean: 30,700 30 25 23,800 20 Historical Registrations Long-term Avg. ('85-'17) Source: R.L. Polk New Registrations, based on Type C/D school buses registered during BB fiscal year Industry average size is 30,700 new units annually
Slide 7: School Buses in Operation
Age Profile of the Existing Fleet ~590k School Buses on the Road as of the end of FY2017 40,000 300k / 52% 110k / 19% 180k / 30% 35,000 15years and under 10 years 10-14 years older 30,000 School Buses in Operation 25,000 Average age of the 20,000 590k+ Unit Fleet is approx. 11 years 15,000 10,000 5,
Slide 8: Blue Bird Highlights
Blue Bird Highlights (2) BLUE BIRD.
Slide 9: Company Snapshot
Company Snapshot Iconic brand with long heritage; more Sales Breakdown (2017A Sales: ~$991mm) than 550,000 buses sold since 1927 The only purpose-built school bus Fuel Type Product Type CNG After Specialty Two major assembly plant locations Gas 1% Market Buses Parts 4% 14% 6% Complete produc
Slide 10: Dedicated Manufacturing Footprint
Dedicated Manufacturing Footprint Micro Bird JV Facility (Drummondville, Quebec, Canada) Micro Bird JV Facility Parts Distribution Center Parts Distribution Center (Drummondville, Quebec) (Delaware, Ohio) (Delaware, Ohio) Design, fabrication, and Electronically guided, houses Commentary assembly of
Slide 11: Blue Bird Differentiators
Blue Bird Differentiators 1 Largest Independent Producer of School Buses 2 Leading Distribution Network 3 Alternative Fuels Leadership 4 Continuous Product Innovation 5 Transformational Initiatives 11
Slide 12: Leader in Key Attributes Our Customers Value
Leader in Key Attributes Our Customers Value Product Attributes Blue Competitor Competitor Ranked in Order of Bird A B Importance1 #1 Safety -- -- #2 Quality, Reliability and -- -- Durability #3 Operating Costs -- -- #4 Acquisition Cost -- -- #5 How the Bus Drives -- -- Blue Bird viewed as the lea
Slide 13: Our Exclusive Dealer Network
Our Exclusive Dealer Network More than 85% of Blue Bird dealers dedicated to bus sales and service 13
Slide 14: Alternative-Fuel Leadership
Alternative-Fuel Leadership FY2017 Alternative-Fuel Bus Sales FY2017 Highlights Sold 3,888 alternative fuel buses; 34% mix Ford/Roush partnership provides three distinct fuel types from the same engine/transmission combination Gasoline Blue Bird propane-powered Vision has the Propane 1,757 hig
Slide 15: Iconic Brand: History of Industry Innovation
Iconic Brand: History of Industry Innovation 1991–1994 First Propane, CNG and Electric COMING SOON IN 2018 Blue Bird Buses Exclusive Exclusive ROUSH 2012 2017 Partnership with CleanTech and Ford ROUSH CleanTech Gen 4 Low NOx and Ford Propane Launched Established to Launch Gen 3 Propane Vision and Mi
Slide 16: Multiple Uses for Blue Bird Buses
Multiple Uses for Blue Bird Buses Type D Blood Mobile Type D GSA Type D Prison Bus Type D/Ayco Body Export Type D GSA Type D GSA/Lift Type C GSA Type A Comm’l 16
Slide 17: Broadest Range of Product Offerings
Broadest Range of Product Offerings NEW #1 #1 Type C & D Alternative Fuel Type D Rear Adomani/EDI Engine Electric #1 Type D Rear Alternative Engine Fuel #1 Type C Traditional Cummins ISL-G CNG Alternative Cummins ISB/ISL Type D Front Diesel Fuel #1 Engine Ford/ROUSH CNG Type C Traditional Alternativ
Slide 18: Transformational Initiatives
Transformational Initiatives Focused on transforming our business structure to drive EBITDA margin improvement –from 7% in FY2017 to 10+% in FY2020 Significant investment in production facilities to support future growth, greater efficiencies and industry-leading quality Partnering with indust
Slide 19: Financial Overview
Financial Overview (2) BLUE BIRD.
Slide 20: Track Record of Growing Sales
Track Record of Growing Sales ($ in millions) Bus Net Sales Parts Net Sales Bus Units Sales $1,200 15,000 $1,025 14,000 $991 $932 $1,000 $919 $60 13,000 $856 $57 $56 $931 $800 $777 1 $54 $862 $876 12,000 $46 $802 11,317 $730 10,616 11,000 $600 $598 10,378 $44 9,604 10,000 $554 $400 8,654 9,000 8,000
Slide 21: Increasing Profitability
Increasing Profitability ($ in millions) Adjusted EBITDA $90 $83 14% $80 $70 $72 $69 $70 $67 12% 10% $60 $50 $50 8% $40 8% 8% 8% 7% 6% $30 6% 4% $20 $17 $10 3% 2% $- 0% FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018G Midpoint Adjusted EBITDA Adjusted EBITDA Margin Consistent improvement with FY202
Slide 22: Strong Cash Flow Generation
Strong Cash Flow Generation ($ in millions) 1 Adjusted Free Cash Flow $59 $45 $44 $42 $33 $31 $12 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018G Midpoint Free cash flow typically represents more than 50% of Adj. EBITDA 1Adjusted for Business Combination and Special Compensation Payments in FY2014
Slide 23: Improving Net Debt, Leverage & Liquidity
Improving Net Debt, Leverage & Liquidity As of December 31, 2017 ($ Millions) Debt $ 149.4 Cash 23.2 Net Debt $ 126.2 Net Debt / Adjusted EBITDA 1.8x Net Leverage Ratio 1.5X Compared with minimum bank Net Leverage Ratio covenant of 3.75x Liquidity1 $ 90.5 1 Liquidity is defined as cash and cash equi
Slide 24: FY2018 Guidance provided February 2018
FY2018 Guidance provided February 2018 FY2018 FY2017 FY2018 Initial Increased $ Millions Results Guidance Guidance Net Sales $991 $1,000-1,030 $1,010-1,040 Midpoint: $1,015 Midpoint: $1,025 Adj. EBITDA $69 $78-82 $80-85 Midpoint: $80 Midpoint: $83 Adj. Free Cash Flow $44 $36-40 $40-45 Midpoint: $38
Slide 25: Wrap-Up
Wrap-Up We differentiate ourselves from our competitors We have exclusive and unique products that our customers want and value We are the undisputed leader in alternative fueled school buses, the fastest growing segment in the industry with double digit growth We are investing in our busine
Slide 26: Thank You!
THANK YOU! (2) BLUE BIRD.
Slide 27: Appendix
Appendix (2) BLUE BIRD.
Slide 28: FY2017 Free Cash Flow
FY2017 Free Cash Flow 4Q Full Year ($ Millions) FY2017 FY2016 FY2017 FY2016 Adjusted EBITDA $25.1 $24.3 $ 68.9 $ 72.2 Cash Paid for Interest (Net) (1.3) (3.9) (6.1) (13.3) Trade Working Capital1 26.0 (4.1) (3.8) (12.0) CAPEX (2.1) (3.1) (9.3) (9.6) Cash Taxes (7.1) 0.9 (8.4) (0.2) Other2 0.1 (11.6)
Slide 29: FY2018 1Q Free Cash Flow
FY2018 1Q Free Cash Flow ($ Millions) FY2018 FY2017 Adjusted EBITDA $ 5.3 $ 2.6 Cash Paid for Interest (Net) (1.2) (1.9) $ $ Trade Working Capital1 (20.6) (27.5) CAPEX (3.4) (3.0) Cash Taxes (0.0) (0.5) 2 Other (11.9) (4.6) Adjusted Free Cash Flow $(31.8) $(34.9) 3 $ $ Cash Paid for Operational Tran
Slide 30: Disclaimer
Disclaimer THE INFORMATION CONTAINED IN THIS PRESENTATION HAS BEEN PREPARED OR OBTAINED BY THE COMPANY FROM ITS BOOKS AND RECORDS AND OTHER SOURCES THAT THE COMPANY BELIEVES TO BE REASONABLY ACCURATE AND RELIABLE. HOWEVER, SUCH INFORMATION NECESSARILY INCORPORATES SIGNIFICANT ASSUMPTIONS AND ESTIMAT