Vistance Networks, Inc. · NASDAQ:VISN
Vistance Networks — CommScope Holding Company — Q1 2020 Earnings Presentation
30 slides from Vistance Networks's earnings presentation, May 7, 2020
Slide 1: First Quarter 2020 Results
First Quarter 2020 Results Eddie Edwards Alex Pease May 7, 2020 President & CEO EVP & CFO
Slide 2: Important Information
Important Information Caution Regarding Forward Looking Statements This presentation or any other oral or written statements made by us or on our behalf may include forward-looking statements that reflect our current views with respect to future events and financial performance. These statements may
Slide 3: Business Overview and COVID-19 Update
Business Overview and COVID-19 Update May 7, 2020 Eddie Edwards President & CEO
Slide 4: Protecting and Caring for our Employees
Protecting and Caring for our Employees • Rigorous health and safety protocols at facilities worldwide • Temporary work-from-home arrangements and paid leave for those directly impacted by COVID-19 • Wellness webinars and free resources to help employees manage work and home life © 2020 CommScope, I
Slide 5: Helping our Customers and Partners
Helping our Customers and Partners • Providing communications equipment and expertise to support critical industries • Donated outdoor wireless access points, switches and support to ITDRC for pop-up emergency healthcare centers and homework hot spots • Free infrastructure training, extended support
Slide 6: Supporting our Communities
Supporting our Communities • Donated face shields and masks for healthcare workers • CommScope matching employee donations to selected global hunger relief organizations • Employee paid leave can be used to support COVID-19 community outreach, including check-ins with CommScope retirees © 2020 CommS
Slide 7: COVID-19 Impact on Our Business
COVID-19 IMPACT ON OUR BUSINESS Importance of network Near-term demand trends Supply chain health connectivity • Cable operators beginning to • Sustaining ~80% global capacity • Digital connectivity has never increase traditional software and production rates across been more critical – moving hardw
Slide 8: Taking decisive actions to strengthen our financial position
OUR RESPONSE TO THE CURRENT ENVIRONMENT Taking decisive actions to strengthen our financial position and prudently manage our balance sheet • Adjusting our operating plan to reduce Optimizing our liquidity position expenses in non-essential areas • Aggressive working capital management preserving ~$
Slide 9: Continued Progress Across Core Operations During the Quarter
CONTINUED PROGRESS ACROSS CORE OPERATIONS DURING THE QUARTER Outdoor Wireless Networks Venue & Campus Carrier 5G investments remain essentially on-track “Better together” go-to-market strategy driving cross-selling • Integrated antenna demand increasing, particularly in wins and strong opportuni
Slide 10: Financial Review and Outlook
Financial Review and Outlook May 7, 2020 Alex Pease EVP & CFO
Slide 11: CommScope 1Q'20 Financial Results
CommScope 1Q’20 Financial Results Net Sales(1) ($M) Adj. EBITDA(2) ($M) Adj. EPS(2) -18% -21% -75% $2,481 $294 $2,033 $231 $0.48 $208 $231 $2,033 $0.12 $1,100 1Q'19 1Q'20 1Q'19 1Q'20 1Q'19 1Q'20 1Q'19 1Q'20 1Q'19 1Q'20 Combined Company(3) Combined Company(3) • COVID-19 negative impact of ~$70 millio
Slide 12: Segment 1Q'20 Financial Results
Segment 1Q’20 Financial Results Venue & Campus Networks Outdoor Wireless Networks Net Sales (1) ($M) Adj. EBITDA(2) ($M) Net Sales ($M) Adj. EBITDA(2) ($M) -6% 87% -11% -12% $499 $38 $470 $101 $391 $349 $89 $20 1Q'19 1Q'20 1Q'19 1Q'20 1Q'19 1Q'20 1Q'19 1Q'20 Combined Company(3) Combined Company(3) •
Slide 13: Segment 1Q'20 Financial Results
Segment 1Q’20 Financial Results Broadband Networks OutdoorHome Networks Wireless Networks Net Sales (1) ($M) Adj. EBITDA(2) ($M) Net Sales (1) ($M) Adj. EBITDA(2) ($M) -20% -33% -27% -67% $137 $36 $767 $824 $613 $93 $601 $12 1Q'19 1Q'20 1Q'19 1Q'20 1Q'19 1Q'20 1Q'19 1Q'20 Combined Company(3) Combine
Slide 14: Cash Flow Update
Cash Flow Update GAAP Cash Flow from Operations (1)($M) Adj. Free Cash Flow(1) (2)($M) $522 $535 $336 $323 $(252) $(43) $(43) $(67) 2Q’19 3Q’19 4Q’19 1Q’20 2Q’19 3Q’19 4Q’19 1Q’20 • Seasonally soft first quarter and net usage of working capital to build inventory for the year. • Emphasis on diligent
Slide 15: Strong liquidity & de-risked capital structure
Strong liquidity & de-risked capital structure Liquidity of over $1.1 billion Debt Maturities ($M) as of 3/31/20 • $394 million in cash + $735 million available ABL as of 3/31/2020 $1,500 • $250 million precautionary ABL draw in April 2020 (no impact on net liquidity position) No significant debt ma
Slide 16: Disciplined fixed cost management with resilient business
Disciplined fixed cost management with resilient business to offset declining revenue • Year 1 exit run rate $100M+ (FY 2019 $55M delivered) Synergy over- • Expect to achieve full synergy delivery in excess of $150M FIXED AND VARIABLE COSTS delivery continues twelve months ahead of schedule • $100M+
Slide 17: Confident in ability to navigate current market headwinds
NEAR-TERM OUTLOOK Confident in ability to navigate current market headwinds Demand Market Key Near-Term Business Drivers Outlook Broadband Network upgrades to Fiber deployments by tier Operators balancing investment relieve stress due to 2/3 operators to connect Networks with internal cash flow need
Slide 18: Summary
SUMMARY We will Committed Strong Flexible cost We plan to protect and to taking leadership structure emerge as a care for our employees, decisive and liquidity to respond to market uncertainties stronger help our actions to navigate the current environment company, customers and to position as we ha
Slide 19: Q&A First Quarter 2020 Results
Q&A First Quarter 2020 Results
Slide 20: Appendix
COMMSCOPE’ Appendix
Slide 21: Statement of Operations
CommScope Holding Company, Inc. Condensed Consolidated Statements of Operations (Unaudited -- In millions, except per share amounts) Statement of Three Months Ended March 31, Operations 2020 2019 Net sales $ 2,033.2 $ 1,099.5 Cost of sales 1,392.0 701.5 Gross profit 641.2 398.0 Operating expenses: S
Slide 22: Balance Sheet
CommScope Holding Company, Inc. Condensed Consolidated Balance Sheets (In millions, except share amounts) Unaudited Balance Sheet March 31, 2020 December 31, 2019 Assets Cash and cash equivalents $ 394.3 $ 598.2 Accounts receivable, less allowance for doubtful accounts of $40.0 and $35.4, respective
Slide 23: Statement of Cash Flows
CommScope Holding Company, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited -- In millions) Statement of Cash Three Months Ended March 31, Flows 2020 2019 Operating Activities: Net loss $ (159.9) $ (2.3) Adjustments to reconcile net loss to net cash used in operating activities: Depre
Slide 24: Adjusted EBITDA and Adjusted Net Income Reconciliation
CommScope Holding Company, Inc. Reconciliation of GAAP Measures to Non-GAAP Adjusted Measures (Unaudited -- In millions, except per share amounts) Three Months Ended March 31, Adjusted EBITDA, and 2020 2019 Net loss, as reported $ (159.9) $ (2.3) Income tax expense (benefit), as reported (31.4) 1.6
Slide 25: Sales by Region
Sales by Region CommScope Holding Company, Inc. Sales by Region (Unaudited -- In millions) Sales by Region % Change Q1 2020 Q1 2019 YOY United States $ 1,220.4 $ 639.1 91.0 % Europe, Middle East and Africa 395.0 229.9 71.8 Asia Pacific 177.6 147.2 20.7 Caribbean and Latin America 158.4 63.5 149.4 Ca
Slide 26: Sales, Operating Income (Loss) and Adjusted EBITDA by Segment
CommScope Holding Company, Inc. Segment Information (Unaudited -- In millions) (1) Sales by Segment Sales, Operating Combined (2) Company % Change Q1 2020 Q1 2019 YOY Income (Loss) and Broadband $ 613.4 $ 766.7 (20.0) % Home 601.4 824.2 (27.0) % Outdoor Wireless 348.9 390.8 (10.7) % Adjusted EBITDA
Slide 27: Adjusted EBITDA Reconciliation by Segment
CommScope Holding Company, Inc. Reconciliation of GAAP to Segment Adjusted EBITDA (Unaudited -- In millions) First Quarter 2020 Segment Adjusted EBITDA Reconciliation (1) Adjusted EBITDA Outdoor Venue and Broadband Home Wireless Campus Total Operating income (loss), Reconciliation by as reported $ (
Slide 28: Adjusted Free Cash Flow Reconciliation
Adjusted Free Cash Flow Reconciliation CommScope Holding Company, Inc. Adjusted Free Cash Flow (Unaudited -- In millions) Adjusted Free Cash Flow Q1 2020 Q1 2019 Cash flow from operations $ (42.7) $ (10.0) Capital expenditures (23.9) (21.4) Free cash flow (66.6) (31.4) Transaction and integration co
Slide 29: New Segment 2019 Financial Information
CommScope Holding Company, Inc. New Segment 2019 New Segment Information (Unaudited -- In millions) Financial (1) Net Sales by Segment (2) (2) (2) Q1 2019 Q2 2019 Q3 2019 Q4 2019 Total Information Broadband $ 766.7 $ 673.3 $ 694.8 $ 673.1 $ 2,807.9 Home 824.2 912.4 826.4 823.6 3,386.6 Outdoor Wirele
Slide 30: New Segment 2019 Adjusted EBITDA Reconciliation
CommScope Holding Company, Inc. Reconciliation of GAAP to Segment Adjusted EBITDA - New Segments (Unaudited -- In millions) (1) First Quarter 2019 Segment Adjusted EBITDA Reconciliation New Segment 2019 Operating income (loss) Broadband $ 57.3 $ Home (23.8) Outdoor Wireless $ 70.9 Venue and $ Campus
CommScope Holding Company — Q1 2020 Earnings Presentation on 6ix