Slide 1: Fourth-Quarter 2017 Results
Fourth - Quarter 2017 Results March 1, 2018 Exhibit 99.2
Slide 2: Forward-Looking Statements
2 Forward - Looking Statements Statements in this presentation contain “forward - looking statements” under the Private Securities Litigation Reform Act of 1995. These statements appear in a number of places in this report and may include statements regarding the intent, belief or current exp ect at
Slide 3: 2017 Financial Performance and 2018 Guidance
3 2017 Reported 2017 Adjusted 2018 Guidance (Pre - Tax Reform) 2018 Guidance (Including Tax Reform) Sales $824.4 million $824.4 million $840 - $860 million $840 - $860 million Gross Margin 30.1% 30.3% 31.0% - 32.0% 31.0% - 32.0% Operating Margin 7.0% 8.1% 9.0% - 10.0% 9.0% - 10.0% EPS $1.57 $1.57 $1
Slide 4: Financial Performance
4 Financial Performance Driving sustainable, profitable growth Q4 Year over Year Sales Adjusted Gross Profit and % Margin Adjusted Operating Income and % Margin Adjusted EBITDA and % Margin +20% +18% $’s in USD Millions $172.6 $207.4 Q4 2016 Q4 2017 $47.8 $61.0 27.7% 29.4% $40.0 $50.0 $60.0 $70.0 Q4
Slide 5: Building a Culture of Performance and Growth
5 Building a Culture of Performance and Growth
Slide 6: Keys to 2018 Success
6 Control Devices Deliver growth in sensing and actuation segments Drive operational efficiency Manage ramp - down of shift - by - wire programs (~Q4) Electronics Execute product launches Capture MirrorEye opportunities Refine engineering footprint and drive global capability PST Drive track & trace
Slide 7: Expansion in Asia
7 Expansion in Asia India and China are opportunities for growth We are expanding our capabilities in Asia to support local growth Expansion in India Joint venture with Spark Minda, Ashok Minda Group Unconsolidated – 49% minority interest Regulations and technology advancements driving growth opport
Slide 8: 2017 Summary & 2018 Overview
8 Financial performance exceeded expectations in 2017 driven by a successful acquisition and strong performance across each of our segments We have a leadership team in place capable of driving global growth and a culture of continuous improvement that will lead to continued success Opportunities in
Slide 9: Financial Update
Financial Update Stoneridge
Slide 10: 4th Quarter 2017 Summary, Results and 2018 Guidance
10 2017 Results 2018 Guidance (Excluding Tax Reform) Midpoint Improvement (Excluding Tax Reform) 2018 Guidance (Including Tax Reform) Midpoint Improvement (Including Tax Reform) Sales $824.4 million $840 - $860 million $25.6 million $840 - $860 million $25.6 million Adjusted Gross Margin 30.3% 31.0%
Slide 11: Control Devices Financial Performance
11 Control Devices Financial Performance Strong global revenue performance and margin improvement continues Control Devices Overview Revenue grew by 6% compared to Q4 2016 highlighted by continued growth in our sensors and actuation business and in particular, shift - by - wire volumes Revenue grew
Slide 12: Electronics Financial Performance
12 Electronics Financial Performance Continued top - line performance Margin expansion continues to drive improved bottom - line performance Electronics Overview Quarter over quarter revenue growth of $28.9 million (52%) driven by Orlaco acquisition, continued growth in aftermarket products, particu
Slide 13: PST Financial Performance
13 PST Financial Performance Continued revenue growth and margin expansion contributing to significant operating income improvement PST Overview Revenue growth of 9% compared to Q4 2016 driven by continued growth in track and trace services as well as general strong performance in the aftermarket sa
Slide 14: Impact of US Tax Cuts and Jobs Act on Tax Rate
14 - 46.8% 23.5% GAAP Q4 Tax Rate Q4 Impact of US Tax Cuts and Jobs Act Adjusted Q4 Tax Rate Expected Impact of US Tax Cuts and Jobs Act The US Tax Cuts and Jobs Act had a positive impact on Q4 earnings due to the one - time transition tax being more than offset by the impact on our deferred tax lia
Slide 15: Capital Allocation Strategy
15 Capital Allocation Strategy We will continue to review the best use of our capital structure in order to maximize shareholder value Net Debt and Leverage Ratio Net Debt / Adjusted EBITDA Current net debt / adjusted EBITDA leverage of 0.7x We will utilize our capital to maximize shareholder return
Slide 16: FY 2018 Guidance
16 2017 Results 2018 Guidance (Excluding Tax Reform) Midpoint Improvement (Excluding Tax Reform) 2018 Guidance (Including Tax Reform) Midpoint Improvement (Including Tax Reform) Sales $824.4 Million $840 - $860 million $25.6 million $840 - $860 million $25.6 million Adjusted Gross Margin 30.3% 31.0%
Slide 17: 4th Quarter 2017 Financial Summary and 2018 Overview
17 All segments exceeded expectations for financial performance Control Devices – 6 % sales growth, 18% operating income growth vs. Q4 2016 Electronics – 52% sales growth, 82% adjusted operating income growth vs. Q4 2016 PST – 9 % sales growth, $1.1 million adjusted operating income growth vs. Q4 20
Slide 18: Thank You
Thank You Stoneridge
Slide 19: Appendix
19 Appendix
Slide 20: Primary Stoneridge Foreign Currency Sensitivities
20 Primary Stoneridge Foreign Currency Sensitivities SRI Currency Exposures If 5% Weaker USD N et Annual EBITDA Transaction Impact to Stoneridge* SRI Guidance Assumption vs. Dec. 31, 2017 Euro / USD Mexican Peso / USD Swedish Krona / USD Brazilia n Real / USD 1.18 1.20 Guidance December 31, 2017 3.2
Slide 21: 2017 Q4 Adjustments
21 2017 Q4 Adjustments The expense resulting from the step - up in the fair value of the earn - out due to Orlaco outperformance was $0.9 million resulting in an EPS adjustment of $ 0.03 The expense related to the step - up in the fair value of the earn - out related to the acquisition of the remain
Slide 22: 2017 Full Year Adjustments
22 2017 Full Year Adjustments Adjustment Expected 2017 After - Tax Impact (USD millions) Expected 2017 After - Tax EPS Impact Orlaco transaction costs ($0.8) ($0.03) Expense related to the step - up in acquired inventory ($1.2) ($0.04) Earn - out (Electronics / Orlaco) ($4.9) ($0.17) Earn - out (PST
Slide 23: 2017 Full Year Adjustments
23 2017 Full Year Adjustments We incurred transaction costs of $0.8 million (after - tax ) related to the acquisition of Orlaco resulting in an EPS add - back of $0.03 As a result of purchase accounting, we recognized a step - up in the fair value of acquired inventory of $ 1.2 million (after - tax)
Slide 24: Income Statement
24 Income Statement Years ended December 31 (in thousands, except per share data) 2017 2016 2015 Net sales $ 824,444 $ 695,977 644,812 Costs and expenses: Cost of goods sold 576,304 500,538 467,834 Selling, general and administrative 141,893 111,145 110,371 Design and development 48,877 40,212 38,79
Slide 25: Segment Financial Information
25 Segment Financial Information Years ended December 31 2017 2016 2015 Net Sales: Control Devices $ 447,528 $ 408,132 $ 333,010 Inter-segment sales 5,044 1,826 2,055 Control Devices net sales 452,572 409,958 335,065 Electronics 282,383 205,256 216,544 Inter-segment sales 39,501 33,361 22,904 Electr
Slide 26: Balance Sheet
26 Balance Sheet CONSOLIDATED BALANCE SHEETS December 31, December 31, (in thousands) 2017 2016 ASSETS Current assets: Cash and cash equivalents $ 66,003 $ 50,389 142,438 113,225 Inventories, net 73,471 60,117 Prepaid expenses and other current assets 21,457 17,162 Total current assets 303,369 240,8
Slide 27: Statement of Cash Flows
27 Statement of Cash Flows Years ended December 31, (in thousands) 2017 2016 2015 OPERATING ACTIVITIES: Net income $ 45,049 $ 75,574 $ 20,567 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 21,490 19,998 18,964 Amortization, including accretion of defer
Slide 28: Statement of Cash Flows (Cont.)
28 Statement of Cash Flows (Cont.) Years ended December 31, (in thousands) 2017 2016 2015 FINANCING ACTIVITIES: Acquisition of noncontrolling interest, including transaction costs (1,848) - - Revolving credit facility borrowings 95,000 - - Revolving credit facility payments (41,000) (33,000) - Proce
Slide 29: Reconciliations to US GAAP
29 Reconciliations to US GAAP
Slide 30: Reconciliations to US GAAP
30 Reconciliations to US GAAP This document contains information about Stoneridge's financial results which is not presented in accordance with accounting principles generally accepted in the United States ("GAAP"). Such non - GAAP financial measures are reconciled to their closest GAAP financial me
Slide 31: Reconciliations to US GAAP
31 Reconciliations to US GAAP Reconciliation of Stoneridge Adjusted Gross Profit (USD in millions) Q4 2017 2017 Gross Profit $61.0 $248.1 Add: Pre-Tax Step-Up in Acquired Inventory from Orlaco - 1.6 Adjusted Gross Profit $61.0 $249.8 Reconciliation of Stoneridge Adjusted Operating Income (USD in mil
Slide 32: Reconciliations to US GAAP
32 Reconciliations to US GAAP Reconciliation of Q4 Adjusted EBITDA (USD in millions) Q4 2017 2017 Q4 2016 2016 Income before tax $12.9 $52.6 $9.0 $39.2 Interest expense, net 1.3 5.8 1.2 6.3 Depreciation and amortization 7.3 27.9 6.1 23.3 EBITDA $21.5 $86.3 $16.4 $68.7 Add: Pre-Tax Step-Up in Acquire
Slide 33: Reconciliations to US GAAP
33 Reconciliations to US GAAP Reconciliation of Electronics Adjusted Operating Income (USD in millions) Q1 2017 Q2 2017 Q3 2017 Q4 2017 2017 Operating Income $5.6 $2.8 $4.9 $4.9 $18.1 Add: Pre-Tax Step-Up in Acquired Inventory from Orlaco 1.0 0.7 - - 1.6 Add: Pre-Tax Step-Up in Fair Value of Earn-Ou