Slide 1: First quarter 2017 earnings call
May 3, 2017 First quarter 2017 earnings call
Slide 2: Forward-looking statements
Forward-looking statements This presentation, as well as other statements made by Delphi Automotive PLC (the “Company”), contain forward-looking statements that reflect, when made, the Company’s current views with respect to current events, certain investments and acquisitions and financial performa
Slide 3: Agenda
Agenda Operational and strategic overview • Strategic update Kevin Clark Chief Executive Officer • Transaction overview Financial overview • Q1 2017 results Joe Massaro Chief Financial Officer • Q2 and 2017 guidance Q&A Kevin Clark / Joe Massaro 3
Slide 4: Strategic overview
Strategic overview Kevin Clark President and Chief Executive Officer
Slide 5: Today's discussion
Today’s discussion • Q1 reflects great start to the year; momentum continues across business segments Strong • Strong sales, margins and EPS growth Q1 2017 • New business awards validating technology relevance • Continued confidence in 2017 outlook and execution • Pursuing a tax free spin of Powertr
Slide 6: Portfolio evolution continues
Portfolio evolution continues Nov Oct 2011 IPO 2012 Oct 2014 Powertrain spin-off announcement Jun 2015 Thermal Jul Jun divestiture Today 2015 2015 Reception Apr Systems Jul Mar 2017 divestiture 2015 2017 Jan Dec 2017 2016 Nov Mar 2015 Dec 2016 2015 Mechatronics divestiture Acquisition Investment Div
Slide 7: Tax free spin of Powertrain business
Tax free spin of Powertrain business Electronics Electrical & Electronic Powertrain & Safety Architecture Global technology leader with unparalleled strengths in signal and power Global technology leader focused on optimizing engine propulsion systems distribution, centralized computing platforms an
Slide 8: E/EA and E&S vision: Enabling smart vehicle architectures
E/EA and E&S vision: Enabling smart vehicle architectures INTERNET OF THINGS BRAIN NERVOUS SYSTEM SYSTEMS INTEGRATION FEATURES AND Software Enabled Vehicle Features High Speed Sensing and Networking CONTENT Active Safety & Infotainment & Power and Signal OTA and Vehicle Data and Services PLATFORMS S
Slide 9: Powertrain vision: Enabling advanced vehicle propulsion
Powertrain vision: Enabling advanced vehicle propulsion INTERNET OF THINGS PROPULSION MANAGEMENT SOFTWARE & CONTROL SYSTEMS INTEGRATION FEATURES AND Optimum Vehicle Efficiency and Driving Experience Intelligent Propulsion Systems CONTENT Advanced Combustion Fuel Injection Sensors & Actuators Power E
Slide 10: Two well-balanced portfolios…
Two well-balanced portfolios… (FY16 sales1) PRODUCTS CUSTOMERS REGIONS Cockpit Controllers, Ford N. America FCA Displays & Connectivity VW Electrical SGM Asia E/EA Architecture GM PSA and Software, Security $12.0B Geely E&S & Services Daimler $100B+ Hyundai Addressable Europe Engineered Other Market
Slide 11: Financial overview
Financial overview Joe Massaro Chief Financial Officer and Senior Vice President
Slide 12: Bookings growth
Bookings growth Continued bookings growth Q1 2017 key wins (Adjusted bookings1, $ billions) Power Electronics Active Safety $25 $26 $21 $21 $20 $17 Asia Pacific/ Europe Infotainment & User Experience $6 2011 2012 2013 2014 2015 2016 Q1 2017 Core Key growth technologies 2 Bookings in key growth techn
Slide 13: Q1 2017 vs. Q1 2016
Q1 2017 vs. Q1 2016 ($ millions, except per share amounts) Q1 2016 Q1 2016 PF3 Q1 2017 B/(W) Reported revenue $316 $4,051 $3,976 $4,292 Adjusted Growth %1 9% EBITDA2 $674 $650 $707 $57 EBITDA margin % 16.6% 16.3% 16.5% 20 bps Operating income2 $512 $489 $537 $48 Operating margin % 12.6% 12.3% 12.5%
Slide 14: Revenue growth
Revenue growth Q1 2017 vs. Q1 2016 Year-over-year growth by region ($ millions) Reported Adjusted1 $467 $4,292 Q1 2017 Q1 2017 $4,051 $3,976 $3 ($75) ($72) ($82) Europe 3% 10% N. America 7% 7% Asia 6% 10% S. America 33% 16% Total 6% 9% Q1 2016 Mechatronics Q1 20162 Price FX/ Acq/ Sales Q1 2017 Pro-f
Slide 15: Operating income growth
Operating income growth Q1 2017 vs. Q1 2016 Highlights ($ millions) • Strong volume flow through $167 $537 $512 $489 12.5% • 1.8% annual price downs 12.6% ($23) 12.3% ($72) $10 ($30) ($1) ($26) • Improved operating performance • Ongoing restructuring benefits Q1 20161 Mechatronics Q1 2016 Price FX/
Slide 16: Segment financials
Segment financials E/EA Powertrain E&S (Revenue, $ millions) Mechatronics revenue $2,342 $1,168 $818 $2,277 $1,117 $697 $622 4% 8% 27% Q1 2017 Q1 2017 Q1 2017 adj growth1 adj growth1 adj growth1 Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1 2016 Q1 2017 ($ millions) Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1 20163 Q1
Slide 17: Earnings per share
Earnings per share Q1 2017 vs. Q1 2016 Highlights • Strong operating income $0.09 $1.59 growth $0.28 $0.04 $1.36 $1.29 ($0.07) • Favorable interest expense ($0.11) from prior year refinancing • Lower share count Q1 20161 Mechatronics Q1 20161 FX/ Operating2 Share Taxes/ Q1 20171 Pro-forma commoditie
Slide 18: 2017 guidance
2017 guidance ($ millions, except per share amounts) Q2 2016 pro forma1 Q2 20174 20174 Reported revenue $4,128 $4,150 - $4,250 $16,500 - $16,900 Adjusted growth2 4% - 6% 4% - 6% Operating income3 $555 $560 - $580 $2,210 - $2,310 Operating margin 13.4% 13.5% - 13.7% 13.4% - 13.7% EPS3 $1.52 $1.62 - $
Slide 19: Portfolio evolution delivering value
Portfolio evolution delivering value Revenue Operating margins Cash flow Shareholder return $ billions % of sales2 Operating cash flow, $ billions Total shareholder return since IPO3 5% ~2.5x CAGR1 ~500bps >2x S&P 500 increase increase return $16.7B 302% 13.5% $2.1B $12.3B 8.8% 118% $1.0B 2010 2017E
Slide 20: Transaction next steps
Transaction next steps • Pro-rata, tax-free distribution of Powertrain shares to Delphi shareholders • Cash dividend from SpinCo to RemainCo What to • Two management teams focused on delivering disciplined, above market growth Expect • Proven business models delivering more margin expansion and cash
Slide 21: Wrap Up
Wrap Up • Q1 reflects great start to the year; positive trends continue across business segments Confident in • Mid-single digit organic revenue growth driven by portfolio of advanced technologies 2017 outlook • Solid operating margin expansion while continuing to invest for growth • Delivering more
Slide 22: Making it possible.
Making it possible. DELPHI Innovation for the Real World
Slide 23: Appendix
Appendix DELPHI
Slide 24: Non-US GAAP financial metrics
Non-US GAAP financial metrics ($ millions) Q1 2017 Q1 2016 Net income attributable to Delphi $335 $425 Interest expense $34 $41 Other expense (income), net $28 ($1) Income tax expense $61 $75 Equity income, net of tax ($11) ($6) Income from discontinued operations, net of tax - ($108) Net income att
Slide 25: Non-US GAAP financial metrics
Non-US GAAP financial metrics ($ millions) Q1 2017 Q1 2016 Net income attributable to Delphi $335 $425 Interest expense $34 $41 Other expense (income), net $28 ($1) Income tax expense $61 $75 Equity income, net of tax ($11) ($6) Income from discontinued operations, net of tax - ($108) Net income att
Slide 26: Non-US GAAP financial metrics
Non-US GAAP financial metrics ($ millions, except per share amounts) Q1 2017 Q1 2016 Net income attributable to Delphi $335 $425 Income from discontinued operations attributable to Delphi, net of tax - ($105) Income from continuing operations attributable to Delphi $335 $320 Adjusting items: Restruc
Slide 27: Shares outstanding
Shares outstanding (millions) Q1 2017 Q1 2016 Weighted average ordinary shares outstanding, basic 269.20 276.62 Dilutive shares related to RSUs 0.34 0.42 Weighted average ordinary shares outstanding, including dilutive shares 269.54 277.04 27
Slide 28: Non-US GAAP financial metrics
Non-US GAAP financial metrics ($ millions) 2010 Net income attributable to Delphi $631 Income tax expense $226 Interest expense $30 Other (income) expense, net ($35) Noncontrolling interest $72 Equity income, net of tax ($6) Income from discontinued operations, net of tax ($64) Operating income $854
Slide 29: Financial guidance metrics
Financial guidance metrics ($ millions) Q2 20171 20171 Net income attributable to Delphi $335 $1,452 Interest expense $34 $136 Other expense, net $5 $41 Income tax expense $65 $285 Equity income, net of tax ($9) ($34) Net income attributable to noncontrolling interest $16 $68 Operating income $446 $
Slide 30: Financial guidance metrics
Financial guidance metrics ($ millions, except per share amounts) Q2 20171 20171 Net income attributable to Delphi $335 $1,452 Restructuring $112 $272 Other acquisition and portfolio project costs $12 $35 Asset impairments - $5 Reserve for Unsecured Creditors litigation - $27 Tax impact of adjusting
Slide 31: Pension expense reclassification detail
Pension expense reclassification detail ($ millions) Q1 2016 Q2 2016 Q3 2016 Q4 2016 2016 Adjusted net income attributable to Delphi $377 $435 $409 $498 $1,719 Pension expense reclassification impact on operating income $3 $3 $3 $10 $19 Pension expense reclassification impact on other income ($3) ($
Slide 32: Mechatronics financial detail
Mechatronics financial detail ($ millions, except per share amounts) Delphi – Reported Q1 2016 Q2 2016 Q3 2016 Q4 2016 2016 Revenue $4,051 $4,206 $4,091 $4,313 $16,661 Adjusted EBITDA1 $674 $748 $707 $787 $2,916 Adjusted operating income1,2 $512 $580 $534 $616 $2,242 Adjusted operating margin1,2 12.
Slide 33: Full year 2016 E/EA and E&S pro-forma financials
Full year 2016 E/EA and E&S pro-forma financials ($ millions) 2016 Reported E/EA 2016 revenue $9,316 Reported E&S 2016 revenue $3,014 Less: Mechatronics divestiture ($285) Pro-forma E/EA and E&S revenue $12,045 ($ millions) 2016 Reported E/EA 2016 adjusted operating income $1,344 Reported E&S 2016 a
Slide 34: Full year 2016 Powertrain pro-forma financials
Full year 2016 Powertrain pro-forma financials ($ millions) 2016 Reported Powertrain 2016 adjusted operating income $511 Pension expense reclassification impact $5 Pro-forma Powertrain adjusted operating income $516 ($ millions) 2016 Powertrain 2016 adjusted EBITDA $699 Pension expense reclassificat
Slide 35: DELPHI
DELPHI Innovation for the Real World