Slide 1: Fourth Quarter and Full-Year 2011 Earnings Conference Call
Driving Change Fourth F th Quarter Q t and d Full-Year F ll Y 2011 Earnings Conference Call March 13, 2012 Jeffrey T. Gill President and CEO B i A. Brian A Lutes L t Vice President & CFO Anthony C. Allen Vice President & Treasurer
Slide 2: Safe Harbor Disclosure
Safe Harbor Disclosure Non-GAAP Financial Measures Any non-GAAP measures, and their related reconciliation to GAAP measures, are provided and available on the Company’s website: www.sypris.com Each “forward-looking statement” herein is subject to serious risks and should not be relied upon, as detai
Slide 3: Table of Contents
Table of Contents • Overview • S Segment t Review R i – Aerospace & Defense – Industrial • Q4 and 2011 Full Year Financial Review • Summary • Q&A Session 3
Slide 4: Overview: Key Highlights for Q4
Overview • Key Highlights for Q4 – R Revenue iincreased d 24 24.3% 3% tto $83 $83.6 6 million illi ffor th the ffourth th quarter, t up ffrom $67 $67.2 2 million in the fourth quarter of the prior year period, driven primarily by a 51.3% revenue increase for our Industrial segment. – Gross profit in
Slide 5: Overview: Key Highlights for 2011
Overview • Key Highlights for 2011 – O Operating ti results lt for f the th year iimproved dddramatically ti ll when h compared d tto 2010 despite the headwinds in our A&D segment. More specifically: • Revenue increased 25.9% to $335.6 million, up almost $70 million from the prior year. • Gross prof
Slide 6: Overview: Key Highlights for 2011
Overview • Key Highlights for 2011 – The Th CCompany positioned iti d ititself lf wellll ffor additional dditi l growth th iin 2012 2012: • Our Industrial Group entered into new multi-year supply contracts with Dana, Eaton, Meritor, Sisamex and others to add an estimated $30 million annually to the
Slide 7: Overview: Key Highlights for 2011
Overview • Key Highlights for 2011 • IInvested t d in i R&D tto ffurther th the th development d l t off a centralized t li d cryptographic t hi key management system to protect the Smart Grid from cyber attacks for the Department of Energy. • Invested in the continued development of advanced protot
Slide 8: Aerospace & Defense
Aerospace & Defense • Key Highlights – R Revenue ddeclined li d tto $11 $11.44 million illi ffor th the quarter, t a llevell th thatt was $3 $3.4 4 million illi below our internal projections and $8.1 million less than the prior year period. • The shortfall to our internal outlook was driven by dela
Slide 9: Aerospace & Defense Outlook
Aerospace & Defense • Outlook – We expect that in hindsight hindsight, the fourth quarter of 2011 will turn out to be the trough for this segment. For 2012, we expect to see sequential growth from this low point as we move throughout the year. • Our recently-developed cyber range test bed and relate
Slide 10: Industrial
Industrial • Key Highlights – R Revenue iincreased d 51 51.3% 3% tto $72 $72.2 2 million illi ffor th the ffourth th quarter, t up ffrom $47 $47.7 7 million for the prior year period, driven by the continued recovery of the commercial vehicle and trailer markets. – Gross p profit increased 325.1% to
Slide 11: Industrial Market Outlook
Industrial • Market Outlook – The Th outlook tl k ffor heavy-duty h d t vehicle hi l and d trailer t il production d ti continues ti tto b be positively impacted by a number of factors, including a favorable freight environment, the age of the fleets, healthy fleet profitability, rising used equipme
Slide 12: Q4 Financial Results – Aerospace & Defense
Q4 Financial Results – Aerospace & Defense ($ in thousands) 4Q11 4Q10 ∆ Highlights Revenue 11,357 19,494 (41.7%) Delayed certification and other funding issues Gross Profit 507 5,381 (90.6%) Decrease in revenue below breakeven Gross Margin 4.5% 27.6% (1) EBITDA (2,559) 1,432 (278.7%) Lower volumes d
Slide 13: 2011 Financial Results – Aerospace & Defense
2011 Financial Results – Aerospace & Defense ($ in thousands) 2011 2010 ∆ Highlights Revenue 62,320 75,500 (17.5%) Completion of 2010 programs; Congress funding Gross Profit 7,886 15,893 (50.4%) Decrease in revenue; unfavorable mix Gross Margin 12.7% 21.1% Q4 results below breakeven (1) EBITDA (3,79
Slide 14: Q4 Financial Results – Industrial
Q4 Financial Results – Industrial ($ in thousands) 4Q11 4Q10 ∆ Highlights Revenue 72,223 47,739 51.3% Heavy truck, trailer volumes up over last year Gross Profit 8,200 1,929 325.1% Volumes and productivity Gross Margin 11.4% 4.0% (1) EBITDA 9,215 2,962 211.1% Increased revenue and productivity impro
Slide 15: 2011 Financial Results – Industrial
2011 Financial Results – Industrial ($ in thousands) 2011 2010 ∆ Highlights Revenue 273,305 191,154 43.0% Commercial vehicle and trailer market growth Gross Profit 27,343 9,002 203.7% Volume; productivity; lower fixed costs Gross Margin 10.0% 4.7% Leverage exists with continued market recovery (1) E
Slide 16: Q4 Financial Results – Consolidated
Q4 Financial Results – Consolidated ($ in thousands) 4Q11 4Q10 ∆ Highlights Revenue 83,580 67,233 24.3% SIG revenue growth of 51% Gross Profit 8,707 7,310 19.1% Conversion on increased revenues; Lean/CI Gross Margin 10.4% 10.9% (1) EBITDA 4,563 2,376 92.0% Increased revenue and productivity improvem
Slide 17: 2011 Financial Results – Consolidated
2011 Financial Results – Consolidated ($ in thousands) 2011 2010 ∆ Highlights Revenue 335,625 266,654 25.9% SIG improvement offset by lower A&D revenue Gross Profit 35,229 24,895 41.5% Profitable conversion on increased SIG revenue Gross Margin 10.5% 9.3% (1) EBITDA 27,004 8,399 221.5% Positive conv
Slide 18: 2011 Summary
2011 Summary • Revenue and gross profit for 2011 increased 26% and 42%, respectively, from the prior yyear,, reflecting p g strong g conversion on incremental Industrial Group p revenue driven by our reduced cost structure and sustained operational performance. • Earnings for the year increased to $
Slide 19: Q & A Session
Earnings Conference Call Q & A Session 19