Blue Bird Corporation · NASDAQ:BLBD
Blue Bird — CJS Securities Conference 2018
23 slides from Blue Bird's conference presentation, Jan 10, 2018
Slide 1: CJS Securities Conference
Blue Bird Corporation CJS Securities Conference January 10, 2018 Private & Confidential
Slide 2: Disclaimer
Disclaimer THE INFORMATION CONTAINED IN THIS PRESENTATION HAS BEEN PREPARED OR OBTAINED BY THE COMPANY FROM ITS BOOKS AND RECORDS AND OTHER SOURCES THAT THE COMPANY BELIEVES TO BE REASONABLY ACCURATE AND RELIABLE. HOWEVER, SUCH INFORMATION NECESSARILY INCORPORATES SIGNIFICANT ASSUMPTIONS AND ESTIMAT
Slide 3: Industry Overview
Industry Overview Private & Confidential 3
Slide 4: School Bus Industry Products
School Bus Industry Products Type C Buses Type D FE Buses (Conventional) (Front Engine, Transit-Style) Seating Capacity: 36-83 Seating Capacity: 54-90 Fuel Types: Diesel, Propane, CNG, Gasoline, Fuel Type: Diesel, Electric (2018) Electric (2018) Type D RE Buses Type A Buses (Rear Engine, Transit-Sty
Slide 5: Industry Overview
Industry Overview OEMs Thomas Blue Bird IC School Bus Customers ~3,400 Contractors ~10,000 School Districts Safe and reliable transportation for over 26 million students each day Private & Confidential 5
Slide 6: Market Recovery
Market Recovery 40 Thousands 37,600 FY2017 35,000 35 34,900 32,900 30 Mean: 30,700 25 23,800 20 Source: R.L. Polk New Registrations, based on Type C/D school buses registered during BB fiscal year 15 Historical Registrations Long-term Avg. ('85-'16) Long-term industry average is 30,700; FY2017 indus
Slide 7: Blue Bird Overview
Blue Bird Overview Private & Confidential 7
Slide 8: Blue Bird Overview
Blue Bird Overview Founded in 1927 Blue Bird product development, manufacturing, fabrication and headquarter facilities all located in Middle Georgia Produce 70 units per day on two shifts Only pure-play school bus manufacturer Product-focused and purpose-built High barriers to entry H
Slide 9: Track Record of Growing Sales
Track Record of Growing Sales ($ in millions) Bus Net Sales Parts Net Sales Bus Units Sales $1,200 15,000 $991 $1,015 14,000 $919 $932 $1,000 $60 $856 13,000 $57 $56 $931 $800 $777 1 $54 $862 $876 12,000 $46 $802 11,317 $730 10,616 $598 11,000 10,378 $600 $44 9,604 10,000 $554 $400 8,654 9,000 8,000
Slide 10: Profit Trend
Profit Trend ($ in millions) Adjusted EBITDA $90 14% $80 $80 $72 $70 $69 12% $67 $70 10% $60 $50 $50 8% 8% 8% 8% $40 7% 6% $30 6% 4% $17 $20 3% 2% $10 $- 0% FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018G Midpoint Adjusted EBITDA Adjusted EBITDA Margin Consistent improvement with 3-5 year target o
Slide 11: Strong Cash Flow Generation
Strong Cash Flow Generation ($ in millions) 1 Adjusted Free Cash Flow $59 $45 $44 $38 $33 $31 $12 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018G Midpoint Business generates strong free cash flow Private & Confidential 1Adjusted for Business Combination and Special Compensation Payments in FY2014,
Slide 12: Alternative-Fuel Leadership
Alternative-Fuel Leadership FY2017 Alternative-Fuel Bus Sales FY2017 Highlights Sold 3,888 alternative fuel buses; 34% mix Ford/Roush partnership provides three distinct fuel types from the same engine/transmission combination Blue Bird propane-powered Vision has the Gasoline highest owner loy
Slide 13: Broadest Range of Product Offerings
Broadest Range of Product Offerings Type C & D Alternative Fuel Type D Rear Adomani/EDI Engine Electric Type D Rear Alternative Engine Fuel Type C Traditional Cummins ISL-G CNG Alternative Cummins ISB/ISL Type D Front Diesel Fuel Engine Ford/ROUSH CNG Type C Traditional Alternative Cummins ISB Diese
Slide 14: Micro Bird Overview
Micro Bird Overview Private & Confidential 14
Slide 15: Micro Bird Overview
Micro Bird Overview JV Founded in 2009 with 50/50 ownership between Blue Bird and the Girardin Family to manufacture Type A buses Product development, manufacturing, fabrication and headquarter facilities all located in Drummondville, Quebec Province, Canada Buses sold for both School Bus and
Slide 16: FY2018 Outlook
FY2018 Outlook Private & Confidential 16
Slide 17: Margin Growth Targeted for FY2018
Margin Growth Targeted for FY2018 Projecting school bus industry at about the same level as FY2017 or slightly higher. Blue Bird projects sales growth of up to 2% in FY2018 Blue Bird is focusing on transforming our business structure to drive margin improvement Significant investment in produc
Slide 18: FY2018 Guidance
FY2018 Guidance FY2017 FY2018 2018G B/(W) $ Millions Results Guidance 2017 Net Sales $991 $1,000-1,030 $9-39 Midpoint: $1,015 Adj. EBITDA $69 $78-82 $9-13 Midpoint: $80 Adj. Free Cash Flow1 $44 $36-40 $(8)-(4) Midpoint: $38 1 Excludes business combination expenses and product redesign initiatives St
Slide 19: Appendix
Appendix Private & Confidential 19
Slide 20: Iconic History
Iconic History 2016 American Securities becomes majority shareholder 89 Years of Innovation Private & Confidential 20
Slide 21: Customer View of Blue Bird
Customer View of Blue Bird Product Attributes Blue Competitor Competitor Ranked in Order of Bird A B Importance1 #1 Safety -- -- #2 Quality, Reliability and -- -- Durability #3 Operating Costs -- -- #4 Acquisition Cost -- -- #5 How the Bus Drives -- -- 1 Checkmarks/Corporate Logo indicate leadersh
Slide 22: Free Cash Flow
Free Cash Flow 4Q Full Year ($ Millions) FY2017 FY2016 FY2017 FY2016 Adjusted EBITDA $25.1 $24.3 $ 68.9 $ 72.2 Cash Paid for Interest (Net) (1.3) (3.9) (6.1) (13.3) Trade Working Capital1 26.0 (4.1) (3.8) (12.0) CAPEX (2.1) (3.1) (9.3) (9.6) Cash Taxes (7.1) 0.9 (8.4) (0.2) Other2 0.1 (11.6) 2.4 (3.
Slide 23: Improving Net Debt, Leverage & Liquidity
Improving Net Debt, Leverage & Liquidity As of Sept 30, 2017 ($ Millions except for ratios) Debt $ 151.2 Cash 62.6 Net Debt $ 88.6 Net Debt / Adjusted EBITDA TTM 1.3x Net Leverage Ratio 1.6X Compared with minimum bank Net Leverage Ratio covenant of 4.0x Liquidity1 $ 130.6 1 Liquidity is defined as c