Allison Transmission Holdings, Inc. · NYSE:ALSN
Allison Transmission — Q4 2019 Earnings Presentation
14 slides from Allison Transmission's earnings presentation, Feb 19, 2020
Slide 1: Q4 2019 Earnings Release
Q4 2019 Earnings Release Published February 19, 2020 (Earnings Conference Call February 20, 2020) David Graziosi, President & Chief Executive Officer Fred Bohley, Senior Vice President & Chief Financial Officer 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement The following information contains, or may be deemed to contain, “forward-looking statements” (as defined in the U.S. Private Securities Litigation Reform Act of 1995). The words “believe,” “expect,” “anticipate,” “intend,” “estimate” and other expressions that are predictions
Slide 3: Non-GAAP Financial Information
Non-GAAP Financial Information We use Adjusted EBITDA and Adjusted EBITDA as a percent of net sales to measure our operating profitability. We believe that Adjusted EBITDA and Adjusted EBITDA as a percent of net sales provide management, investors and creditors with useful measures of the operationa
Slide 4: Call Agenda
Call Agenda Q4 2019 Performance 2020 Guidance 4
Slide 5: Q4 2019 Performance Summary
Q4 2019 Performance Summary ($ in millions) Q4 2019 Q4 2018 % Variance Net Sales $617 $647 (4.6%) Gross Margin % 48.3% 52.2% (390) bps Net Income $107 $147 (27.2%) Adjusted EBITDA(1) $216 $261 (17.2%) Commentary Net Sales: decrease was principally driven by lower demand in the Global Off-Highway and
Slide 6: Q4 2019 Sales Performance
Q4 2019 Sales Performance ($ in millions) End Markets Q4 2019 Q4 2018 % Variance Commentary Principally driven by higher demand for Rugged Duty Series, Highway Series and Electric-Hybrid Propulsion models, led by the North America On-Hwy $330 $303 8.9% continued execution of our growth initiatives a
Slide 7: Q4 2019 Financial Performance
Q4 2019 Financial Performance ($ in millions, except per share data) Q4 2019 Q4 2018 $ Var % Var Commentary Net Sales $617 $647 ($30) (4.6%) Decrease was principally driven by lower demand in the Global Off-Highway and Service Parts, Support Equipment & Other end markets partially offset by higher d
Slide 8: Q4 2019 Cash Flow Performance
Q4 2019 Cash Flow Performance ($ in millions) Q4 2019 Q4 2018 $ Variance % Variance Commentary Principally driven by lower gross profit, increased cash interest expense and Net Cash Provided by increased product initiatives spending $202 $232 ($30) (12.9%) partially offset by lower operating working
Slide 9: 2020 Guidance – End Markets Net Sales Commentary
2020 Guidance – End Markets Net Sales Commentary ($ in millions) 2019 2020 End Market Commentary Net Sales Midpoint Principally driven by lower class 8 straight truck and class 5 through 7 truck North America On-Hwy $1,474 (16%) production North America Off-Hwy $30 (50%) Principally driven by lower
Slide 10: 2020 Guidance
2020 Guidance ($ in millions) Guidance Commentary Reflects lower demand in the Global On-Highway and Global Off-Highway end markets partially offset by increased Net Sales $2,375 to $2,475 demand in the Service Parts, Support Equipment & Other and Defense end markets and price increases on certain p
Slide 11: APPENDIX Non-GAAP Financial Information
APPENDIX Non-GAAP Financial Information 11
Slide 12: Non-GAAP Reconciliations (1 of 3)
Non-GAAP Reconciliations (1 of 3) Adjusted EBITDA reconciliation Three months ended $ in millions, Unaudited For the year ended December 31, December 31, 2015 2016 2017 2018 2019 2018 2019 Net income (GAAP) $182 $215 $504 $639 $604 $147 $107 plus: Interest expense, net 114 101 103 121 134 31 33 Inco
Slide 13: Non-GAAP Reconciliations (2 of 3)
Non-GAAP Reconciliations (2 of 3) Adjusted Free Cash Flow reconciliation Three months ended $ in millions, Unaudited For the year ended December 31, December 31, 2015 2016 2017 2018 2019 2018 2019 Net Cash Provided by Operating Activities (GAAP) $580 $591 $658 $837 $847 $232 $202 (Deductions) or Add
Slide 14: Non-GAAP Reconciliations (3 of 3)
Non-GAAP Reconciliations (3 of 3) Guidance Reconciliation $ in millions Guidance Year Ending December 31, 2020 Low High Net Income (GAAP) $ 425 $ 475 plus: Income tax expense 124 134 Interest expense, net 133 133 Depreciation and amortization 149 149 Stock-based compensation expense 15 15 UAW Local
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