Slide 1: 2024 Q1 Conference Call Presentation
2024 Q1 Conference Call Presentation Linda Hasenfratz, Executive Chair & CEO May 8th, 2024 For Audio Only Dial in: North America: +1 (888) 259-6580 International: +1 (416) 764-8624 Conference ID: 90762585
Slide 2: Forward Looking Information, Risk and Uncertainties
Forward Looking Information, Risk and Uncertainties Certain information regarding Linamar set forth in this presentation and oral summary, including management’s assessment of the Company’s future plans and operations may constitute forward-looking statements. This information is based on current ex
Slide 3: Agenda: Quarter Highlights
Agenda Quarter Highlights Financial Strategy & Operations • Double Digit Top & • Bourgault acquisition Bottom-Line Growth closed and integration • $10 Billion Sales Goal begun Met Markets & Market Share Innovation & New • Market Share Growth Business • Continued NBW across Mobility and Industrial ra
Slide 4: Financial
Financial
Slide 5: Financial Highlights Q1 2024
Agenda Financial Highlights Q1 2024 • Double Digit Top & Bottom-Line Growth • Sales up 19% • Normalized EPS1 up 31% • Net Normalized Margin2 Expansion vs Prior Year to Reach 5.9% • Excellent Mobility Segment Earnings Growth of 58% and Margin Growth to 6.2% 1 - Net Earnings (Loss) per Share – Diluted
Slide 6: Financial Highlights: Income Statement
Financial Highlights Income Statement (in millions CAD) Q1 2024 Q1 2023 %Δ TTM2 2024 TTM2 2023 %Δ Q1 2024 The key factors impacting results in the quarter are: Sales 2,721.9 2,292.7 18.7% 10,162.8 8,432.4 20.5% 1) 2023 and 2024 acquisitions; NE – Normalized1 159.6 121.7 31.1% 578.9 451.5 28.2% 2) La
Slide 7: Financial Highlights: Balance Sheet
Financial Highlights Balance Sheet (in millions CAD) Q1 2024 Q1 2023 TTM4 2024 TTM4 2023 ▪ Balance sheet has remained consistently strong despite higher acquisition activity and resumption of normal capex spending Net Debt1 1,827.9 475.5 ▪ Leverage in excellent shape at 1.24x Net Debt to EBITDA desp
Slide 8: Strategy & Operations
Strategy & Operations © Linamar Corporation 8
Slide 9: Strategy & Operations Highlights
Agenda Strategy & Operations Highlights Skyjack Agriculture Group • New China facility grand opening • Completed acquisition of Bourgault with solid government and customer Industries support • Immediately accretive acquisition • Integration underway and progressing well © Linamar Corporation 9
Slide 10: Linamar's Powerful Synergistic Diversification Model
Linamar’s Powerful Synergistic Diversification Model Cash for Continued Brand Investment Management MOBILITY The Power of a Balanced & Diversified Business Model SEGMENT INDUSTRIAL Consistent Strong, Stable Sustainable Strong Profit SEGMENT Margins Free Cash Flow Balance Sheet Consistent Growth Supp
Slide 11: Synergistic Diversification Model Key Driver of Long-Term Performance
Synergistic Diversification Model Key Driver of Our Long-Term Consistent Strong Performance Note: Years in which Double Digit Growth in Sales or Normalized Net Earnings is denoted by a star. 1 - Free Cash Flow (FCF) and Net Earnings (NE) – Normalized are Non-GAAP Financial Measures. Please refer to
Slide 12: Markets & Market Share
Markets & Market Share © Linamar Corporation 12
Slide 13: Market Share Highlights
Agenda Market Share Highlights Mobility Access Agriculture • CPV up in every region • Increased global market • Excellent global market globally share for scissors, our share growth for • NA reached a new largest access combine drapers, our quarterly record equipment product largest agricultural lev
Slide 14: Market Snapshot
Market Snapshot Mobility: • 2024 global light vehicle production +/- 2% depending on region for overall flat markets Light Commercial Light Commercial • 2025 modest growth in most regions 2024 Vehicle Truck Agriculture Access 2025 Vehicle Truck Access • Strong launch book and market share growth con
Slide 15: Automotive Sales & Content Per Vehicle (CPV)
Automotive Sales & Content Per Vehicle2 (CPV) CPV Q1 2024 CPV Q1 2023 CPV % Change Vehicle Production Automotive Automotive Automotive Units % Change Sales Q1 2024 Sales Q1 2023 Sales % Change (CAD Millions) (CAD Millions) North America 294.99 243.26 21.3% 1.2% 1,206.5 983.5 22.7% Europe 110.10 96.9
Slide 16: Industrial Segment: Market Share Gains in Key Segments
Industrial Segment: Market Share Gains in Key Segments MacDon Combine Drapers: Global Market Share Q1 2020 Q2 2020 Q3 2020 Q1 2021 Q2 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q4 2020 Q3 2021 Source: AEM & Linamar Internal, Apr. 24, 2024.
Slide 17: Innovation & New Business
Innovation & New Business © Linamar Corporation 17
Slide 18: Q1 Innovation & New Business Highlights
Agenda Q1 Innovation & New Business Highlights Mobility Access Agriculture • Strong Product • New Micro Scissor • MacDon, Salford Portfolio in Propulsion launch launching new Agnostic Products innovations • AFS Casting of The Year award for Linamar Structures Group © Linamar Corporation 18
Slide 19: Continued Mobility New Business Wins
Agenda Continued Mobility New Business Wins ▪ Q1 NBWs a good blend of ▪ Propulsion Agnostic and Powertrain ▪ BEV, HEV and ICE ▪ >$50M in propulsion agnostic wins for light vehicles and commercial trucks ▪ >$20M in wins for gears across a variety of propulsion types © Linamar Corporation 19
Slide 20: Mobility Launches
Mobility Launches 3.50 Launching nearly $3.4 Billion of new work today 3.00 2.50 CAD (Billions) 2.00 1.50 1.00 0.50 0.00 2023 2024 2025 2026 2027 Incremental Growth from Launches $600 to $800 Million in 2024 $700 to $900 Million in 2025 Updated: May 2024 © Linamar Corporation 20
Slide 21: Solid Blend of Products Suited to Changing Propulsion Types
Solid Blend of Products Well Suited to a Changing Landscape of Propulsion Types 2028 Light Vehicle Sales by Propulsion Type & System 38% 44% 18% Propulsion Agnostic BEV/HEV Powertrain ICE Powertrain Source: Linamar Internal, Apr. 24, 2024. © Linamar Corporation 21
Slide 22: Flexibility of Linamar Mobility's Asset Base
Flexibility Of Linamar Mobility’s Asset Base: Well Positioned to Manage through the market Transition to EV Linamar Mobility’s Linamar’s Long-time CNC Flexible Equipment Strategy Capital Asset Equipment Breakdown1 Key to Maximize Asset Utilization ▪ Flexibility should directly correlate to level of
Slide 23: Innovation: American Foundry Society - Best in Class
Innovation: American Foundry Society - Best in Class Best In Class Award - Linamar Structures Group ▪ Battery Electric Vehicle Semi-Trailing Arm ▪ Created design that meets or exceeds all customer performance targets while achieving a weight savings of 9 KG per vehicle © Linamar Corporation 23
Slide 24: Innovation: Skyjack Micro Scissors
Innovation: Skyjack Micro Scissors New Micro Scissor Range ▪ Significant new choice in low-level access arena ▪ Utilizing highly efficient AC electric drive motors ▪ Ideal for access into tight spaces ▪ Enhanced duty cycles ▪ ECO Marked for sustainability © Linamar Corporation 24
Slide 25: Innovation: MacDon R1 Front Mount Rotary Header
Innovation: MacDon R1 Front Mount Rotary Header • Expands our Rotary header product line up • Doubles productivity • Responsive Float System achieves true ground following • Commonality across the platform © Linamar Corporation 25
Slide 26: Innovation: Bourgault XR871 & XR851 Extended Range Harrows
Innovation: Bourgault XR871 & XR851 Extended Range Harrows © Linamar Corporation 26
Slide 27: Outlook
Outlook © Linamar Corporation 27
Slide 28: Outlook
Outlook Consolidated Sales Growth Normal Ranges 2023 Actuals 22.9% Expectations 2024 Double Digit Growth Expectations 2025 Continued Growth Q2 2024 Expectations Normalized EPS Growth 1 40.3% Double Digit Growth Continued Double Digit Growth ▪ Mobility Normalized Net Margin 1 7.0% - 9.0% 5.6% Expansi
Slide 29: Financial Review
Financial Review Dale Schneider, CFO Linamar Corporation 29
Slide 30: Financial Highlights
Financial Highlights Income Statement (in millions CAD) Q1 2024 Q1 2023 %Δ TTM2 2024 TTM2 2023 %Δ Q1 2024 The key factors impacting results in the quarter are: Sales 2,721.9 2,292.7 18.7% 10,162.8 8,432.4 20.5% 1) 2023 and 2024 acquisitions; NE – Normalized1 159.6 121.7 31.1% 578.9 451.5 28.2% 2) La
Slide 31: Foreign Exchange Gain/Loss
Foreign Exchange Gain/Loss (in millions CAD) Q1 2024 Q1 2023 +/- ▪ Total FX Gain was $24.9 which resulted from a $25.4 FX Gain – FX Gain/(Loss) – Operating1 25.4 6.0 19.4 Operating and a $0.5 FX Loss – Financing. FX Gain/(Loss) – Financing (0.5) (0.2) (0.3) ▪ FX Gain – Operating was comprised of an
Slide 32: Industrial Sales, Earnings, and Margins
Industrial Sales, Earnings, and Margins (in millions CAD) Industrial Sales increased by 24.5% or $143.6 to $728.6 Q1 2024 Q1 2023 ▪ The Sales were helped by: Finance ▪ the additional sales from the first two months of results from the acquisition of Sales 728.6 585.0 Bourgault; and updating ▪ a subs
Slide 33: Mobility Sales, Earnings, and Margins
Mobility Sales, Earnings, and Margins (in millions CAD) Mobility Sales increased by 16.7% or $285.6 to $1,993.3 Q1 2024 Q1 2023 ▪ The Sales were helped by: ▪ the additional sales from our Linamar Structures acquisitions in 2023; Sales 1,993.3 1,707.7 ▪ the increasing volumes on launching programs an
Slide 34: Operating Expenses
Operating Expenses (in millions CAD) Q1 2024 Q1 2023 +/- % ▪ Gross Margin was $393.2 in the quarter and was impacted by the same factors that impacted each business segment. (See the previous two slides) Sales 2,721.9 2,292.7 429.2 18.7% Cost of Goods Sold 2,328.7 1,992.2 336.5 16.9% ▪ Amortization
Slide 35: Finance Expenses & Income Tax
Finance Expenses & Income Tax (in millions CAD) ▪ Finance expenses increased by $19.7 Q1 2024 Q1 2023 +/- ▪ Finance expenses were hurt by: ▪ the new private placement notes issued in June 2023 to fund the Linamar Structures acquisitions; Finance Expense 32.9 13.2 19.7 ▪ the new term credit facility
Slide 36: Leverage
Leverage (in millions CAD) Q1 2024 Q1 2023 ▪ Cash position at the end of the quarter was $787.2, which was an increase of $133.9 from the end of 2023. Cash Position 787.2 890.7 ▪ Linamar generated $150.1 in Cash from Operating Activities being used primarily to fund Q1 capital expenditures. Availabl
Slide 37: Conclusion
Conclusion ▪ Double-Digit Sales growth in both Industrial and Mobility ▪ Overall, sales up 18.7% for Q1 2024 compared to Q1 2023; ▪ Improving performance in both segments; ▪ Industrial Sales up by nearly 25%; and ▪ Record Mobility sales for the quarter. ▪ Double-Digit Normalized Operating Earnings a
Slide 38: Question and Answer
Question and Answer © Linamar Corporation 38
Slide 39: Outlook
Outlook Consolidated Sales Growth Normal Ranges 2023 Actuals 22.9% Expectations 2024 Double Digit Growth Expectations 2025 Continued Growth Q2 2024 Expectations Normalized EPS Growth 1 40.3% Double Digit Growth Continued Double Digit Growth ▪ Mobility Normalized Net Margin 1 7.0% - 9.0% 5.6% Expansi
Slide 40: Key Messages
Key Messages Goal of $10 Billion Sales Met Double Digit Top and Bottom Line Growth in Both Segments and Overall Stellar Growth of Mobility Segment © Linamar Corporation 40
Slide 41: Thank You
Thank You www.linamar.com © Linamar Corporation 41