Blue Bird Corporation · NASDAQ:BLBD
Blue Bird — FY2019 Earnings Presentation
26 slides from Blue Bird's earnings presentation, Dec 11, 2019
Slide 1: Fiscal 2019 Full Year and Fourth Quarter Results
Blue Bird Corporation (Nasdaq: BLBD) Fiscal 2019 Full Year and Fourth Quarter Results Earnings Conference Call December 11, 2019
Slide 2: Agenda
Agenda ▪ Introductions & Forward-Looking Statements – Mark Benfield – Executive Director, Profitability & Investor Relations ▪ Business Overview – Phil Horlock – President & CEO ▪ Financial Results – Phil Tighe – CFO ▪ Outlook and Guidance – Phil Horlock – President & CEO ▪ Q&A – Group This presenta
Slide 3: Business Overview
Phil Horlock President & CEO BUSINESS OVERVIEW 3
Slide 4: Overview
Overview ▪ Achieved highest 4Q profit in more than 10 years ◦ Adjusted EBITDA of $33.4M, $4.3M or 15% above last year ◦ 3,726 buses sold, second highest 4Q in past 10 years; down by 31 units from last year ◦ Total Net Sales of $343.5M, 4% above last year ▪ FY2019 results equal to or better than guid
Slide 5: Significant Operating Achievements
Significant Operating Achievements Robotic Paint Facility Significant gains in Year-Over-Year Increase in Quality revenue per bus Adj. EBITDA Margin Costs +$4k Capacity (Pts.) Adj. EBITDA Margin Transformational Fully operational and Bus Rev./Unit up 5% Grew Adj. EBITDA Margin initiatives on track i
Slide 6: Full Year and 4Q Financial Results
Full Year and 4Q Financial Results Bus Sales Total Net Sales Full Year 4Q Full Year 4Q $952.2M $325.8M $1,018.9M $343.5M Down $10.5M Up $10.6M Down $6.1M Up $11.9M Parts Sales Adj. EBITDA1 Full Year 4Q Full Year 4Q $81.8 $33.4 $66.6M $17.7M Million Million Up $4.4M Up $1.4M Up $11.5M Up $4.3M Full Y
Slide 7: Alternative-Fuel Leadership
Alternative-Fuel Leadership Record Sales in FY2019 ▪ Full Year sales 21% above last year ▪ Record Full Year sales mix at 48% ▪ 54% sales mix achieved in 2H Up 21% ▪ Propane sales 41% above last year Opportunities ▪ VW mitigation funds ◦ 50 states have finalized mitigation plans ◦ Approximately $600M
Slide 8: Transformational Initiatives Drive Down Cost
Transformational Initiatives Drive Down Cost FY2018 FY2019 FY2020+ Phase 1 Phase 2 Phase 3 Purchased Material Purchased Material Purchased Material – Commercial – Commercial – Commercial – Sourcing – Sourcing – Sourcing – Initial design – Design Build and Launch New Paint Facility New Paint Facility
Slide 9: Financial Results & Outlook
Phil Tighe CFO FINANCIAL RESULTS & OUTLOOK 9
Slide 10: 4Q Results – Summary
4Q Results – Summary ($ Millions unless noted) 4Q FY2019 4Q FY2018 B/(W) Unit Volume 3,726 3,757 (31) Net Revenue $343.5 $331.6 $11.9 Bus Rev./Unit ($000's) $87.4 $83.9 $3.5 Gross Margin 13.6% 12.9% 70 bps. Net (Loss) Income $11.6 $14.9 $(3.3) Adj. Net Income1 $20.0 $20.1 $(0.1) Adj. EBITDA1 $33.4 $
Slide 11: Full Year Results – Summary
Full Year Results – Summary ($ Millions except EPS & Margin) FY2019 FY2018 B/(W) Unit Volume 11,017 11,649 (632) Net Revenue $1,018.9 $1,025.0 $(6.1) Bus Rev./Unit ($000's) $86.4 $82.6 $3.8 Gross Margin 13.1% 11.9% 120 bps. Net Income $24.3 $30.8 $(6.5) Adj. Net Income1 $43.5 $50.6 $(7.1) Adj. EBITD
Slide 12: 4Q FY2018 to FY2019 Adj. EBITDA Walk
4Q FY2018 to FY2019 Adj. EBITDA Walk ($ Millions) Pricing and cost reductions through Transformational Initiatives drive higher profits despite slightly lower volume, higher economics and manufacturing launch costs See appendix for additional detail regarding Adjusted EBITDA 12
Slide 13: FY2018 to FY2019 Adj. EBITDA Walk
FY2018 to FY2019 Adj. EBITDA Walk ($ Millions) Pricing and transformational initiatives more than offset the impact of lower volume, material economics and manufacturing launch costs See appendix for additional detail regarding Adjusted EBITDA 13
Slide 14: FY2019 Free Cash Flow
FY2019 Free Cash Flow 4Q Full Year ($ Millions) FY2019 FY2018 FY2019 FY2018 Adjusted EBITDA $ 33.4 $ 29.1 $ 81.8 $ 70.4 Cash Paid for Interest (Net) (2.5) (1.2) (10.4) (5.8) Trade Working Capital1 55.4 14.3 (1.6) 7.0 CAPEX (5.4) (16.5) (35.5) (32.1) Cash Taxes (2.2) — (4.6) (3.7) Other2 (1.5) 5.0 5.
Slide 15: Improving Net Debt, Leverage & Liquidity
Improving Net Debt, Leverage & Liquidity As of ($ Millions) September 28, 2019 Debt $183.1 Cash 71.0 Net Debt $112.2 Net Debt / Adjusted EBITDA 1.4x Net Leverage Ratio 2.1x Compared with minimum bank Net Leverage Ratio covenant of 3.75x Liquidity1 $164.1 1 Liquidity is defined as cash and cash equiv
Slide 16: Outlook & Guidance
Phil Horlock President & CEO Outlook & Guidance 16
Slide 17: FY2020 Outlook – Continuing Our Margin Growth Plan
FY2020 Outlook – Continuing Our Margin Growth Plan ▪ School bus industry outlook at about 34k, the same level as prior two years, supported by continued growth in property taxes, high mix of buses that are more than 15 years old and VW settlement and other funding to replace aging diesel buses ▪ In
Slide 18: Announcing FY2020 Full Year Guidance
Announcing FY2020 Full Year Guidance FY2019 FY2020 FY2020G $ Millions Actual Guidance B/(W) FY2019 Net Sales $1,018 $1,020 - $1,050 $2 - $32 Adj. EBITDA1 $82 $90-95 $8 - $13 Adj. Free Cash Flow1 $36 $30 - $35 $(6) - $(1) FY2020 Guidance mid-point for Adjusted EBITDA 13% higher than FY2019, driven by
Slide 19: (2) BLUE BIRD.
(2) BLUE BIRD.
Slide 20: Appendix
Appendix (2) BLUE BIRD.
Slide 21: Adj. EBITDA Reconciliation
Adj. EBITDA Reconciliation Reconciliation of Net Income to Adjusted EBITDA Three Months Ended Fiscal Year Ended (in thousands of dollars) September 28, 2019 September 29, 2018 September 28, 2019 September 29, 2018 Net income $ 11,592 $ 14,932 $ 24,300 $ 30,820 Adjustments: Discontinued operations in
Slide 22: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation Reconciliation of Free Cash Flow to Adjusted Free Cash Flow Three Months Ended Fiscal Year Ended (in thousands of dollars) September 28, 2019 September 29, 2018 September 28, 2019 September 29, 2018 Net cash provided by operating activities $ 74,819 $ 41,331 $ 55,706 $
Slide 23: Adjusted EPS Reconciliation
Adjusted EPS Reconciliation Reconciliation of Net Income to Adjusted Net Income Three Months Ended Fiscal Year Ended (in thousands of dollars) September 28, 2019 September 29, 2018 September 28, 2019 September 29, 2018 Net income $ 11,592 $ 14,932 $ 24,300 $ 30,820 Adjustments, net of tax benefit or
Slide 24: Important Disclaimers
Important Disclaimers Forward Looking Statements This presentation includes forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations for future financial performance,
Slide 25: Important Disclaimers
Important Disclaimers Non-GAAP Financial Measures This presentation may include the following non-GAAP financial measures: “Adjusted EBITDA,” "Adjusted EBITDA Margin," “Adjusted Net Income,” “Adjusted Diluted Earnings per Share,” “Free Cash Flow” and “Adjusted Free Cash Flow.” Adjusted EBITDA is def
Slide 26: END
(2) BLUE BIRD.