Allison Transmission Holdings, Inc. · NYSE:ALSN
Allison Transmission — Q4 2017 Earnings Presentation
13 slides from Allison Transmission's earnings presentation, Feb 14, 2018
Slide 1: Q4 2017 Earnings Release
Q4 2017 Earnings Release Published February 14, 2018 (Earnings Conference Call February 15, 2018) Lawrence Dewey, Chairman & Chief Executive Officer David Graziosi, 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 margin to measure our operating profitability. We believe that Adjusted EBITDA and Adjusted EBITDA margin provide management, investors and creditors with useful measures of the operational results of our business and increase
Slide 4: Call Agenda
Call Agenda Q4 2017 Performance 2018 Guidance 4
Slide 5: Q4 2017 Performance Summary
Q4 2017 Performance Summary ($ in millions) Q4 2017 Q4 2016 % Variance Net Sales $588 $469 25.4% Gross Margin % 49.0% 46.4% 260 bps Net Income $215 $61 252.5% Adjusted EBITDA(1) $210 $158 32.9% Adjusted Free Cash Flow (1) $115 $145 (20.7%) Commentary Net Sales: increase was principally driven by hig
Slide 6: Q4 2017 Sales Performance
Q4 2017 Sales Performance ($ in millions) End Markets Q4 2017 Q4 2016 % Variance Commentary Principally driven by higher demand for Rugged Duty Series North America On-Hwy $270 $217 24% models North America Electric Hybrid-Propulsion $17 $20 -15% Principally driven by intra-year movement in the timi
Slide 7: Q4 2017 Financial Performance
Q4 2017 Financial Performance ($ in millions, except per share data) Q4 2017 Q4 2016 $ Var % Var Commentary Net Sales $588 $469 $119 25.4% Increase was principally driven by higher demand in the North America On- Highway, Service Parts, Support Equipment & Other, North America Off- Highway and Outsi
Slide 8: Q4 2017 Cash Flow Performance
Q4 2017 Cash Flow Performance ($ in millions) Q4 2017 Q4 2016 $ Variance % Variance Commentary Principally driven by increased cash interest expense, increased cash income taxes, increased pension funding, unfavorable warranty adjustments, Net Cash Provided by $166 $175 ($9) (5.1%) increased product
Slide 9: 2018 Guidance – End Markets Net Sales Commentary
2018 Guidance – End Markets Net Sales Commentary ($ in millions) 2017 2018 End Market Commentary Net Sales Midpoint North America On-Hwy $1,106 7% Principally driven by higher Class 8 straight and Class 6/7 truck production North America Electric Hybrid-Propulsion $71 (6%) Principally driven by timi
Slide 10: 2018 Guidance - Summary
2018 Guidance - Summary Guidance Commentary Guidance anticipates continued strength in the North American On-Highway end market. Allison‘s 2018 net sales outlook also assumes increased demand in the Outside 3 to 7 Net Sales Change from 2017 North America On-Highway, Defense and North America percent
Slide 11: Appendix: Non-GAAP Financial Information
APPENDIX Non-GAAP Financial Information 11
Slide 12: Non-GAAP Reconciliations (1 of 2)
Non-GAAP Reconciliations (1 of 2) Adjusted EBITDA reconciliation Three months ended $ in millions, Unaudited For the year ended December 31, December 31, 2013 2014 2015 2016 2017 2016 2017 Net income $165 $229 $182 $215 $504 $61 $215 plus: Interest expense, net 133 138 114 101 103 17 25 Income tax (
Slide 13: Non-GAAP Reconciliations (2 of 2)
Non-GAAP Reconciliations (2 of 2) Adjusted Free Cash Flow reconciliation Three months ended $ in millions, Unaudited For the year ended December 31, December 31, 2013 2014 2015 2016 2017 2016 2017 Net Cash Provided by Operating Activities $464 $573 $580 $591 $658 $175 $166 (Deductions) or Additions:
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