Visteon Corporation · NASDAQ:VC
Visteon — Automotive Analysts of New York (January 2008)
36 slides from Visteon's conference presentation, Jan 17, 2008
Slide 1: 2008 Business Update and Outlook
2008 Business Update and Outlook Automotive Analysts of New York January 17, 2008 Applying our automotive intellect to design products that help customers build vehicles that appeal to drivers and passengers around the world
Slide 2: Forward Looking Information
Forward Looking Information This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various factors, risks and uncertai
Slide 3: Visteon Overview
Visteon Overview Air Induction HVAC Systems Powertrain Cooling Compressors Climate Cockpit Modules Instrument Panels Consoles Door Trim Modules Interiors Audio Driver Information Cockpit Electronics Front / Rear Lighting $3.3 billion $3.1 billion $3.6 billion 2007E Sales Mfg Locations: $0.3 Billion
Slide 4: Global Market Position
Global Market Position No. 2 - Interiors No. 2 - Climate Control No. 3 - OE Audio Head Unit No. 3 - Driver Information No. 4 - Center Stack Electronics
Slide 5: 2007 Accomplishments
2007 Accomplishments New business wins continue Completed 7 restructuring actions, including divestitures of non-core operations Continued shift to lower cost countries EBIT-R in line with guidance; free cash flow significantly better Actions to enhance liquidity; YE cash at $1.75 billion Delivered
Slide 6: Value Perspective
Value Perspective Asian sales strong today and growing anchored by Halla and Yanfeng Non-consolidated sales of $3 billion by 2010 mostly in Asia Diverse customer base - Ford NA decreasing to 6% of total sales by 2010 Value Perspective Diverse Sales - Customers and Geographies Key Drivers Restructuri
Slide 7: Sales Position - Regional View
Sales Position - Regional View 2007E Non-Consolidated Sales - $1.7 Billion 2007E Consolidated Sales - $10.7 Billion 2010E Consolidated Sales - $9.8 Billion 2010E Non-Consolidated Sales - $3.2 Billion Asia Sales Strong Today and Growing - Anchored by Halla and YanFeng Please see important disclosures
Slide 8: Asia Operations
Asia Operations Philippines United Aluminum Radiator (Changchun) Jiangxi Fuchang (Nanchang) Halla Climate Control (Rayong) Halla Climate Control (Pyongtaek, Taejon, Ulsan) Japan Climate Systems (Hiroshima) Dongfeng Visteon (Wuhan, Shiyan) Yanfeng Visteon Automotive Trim Systems (Beijing) Halla Clima
Slide 9: Sales Position - Customer View
Sales Position - Customer View 2010E Customer Distribution - Consolidated Sales Hyundai / Kia largest customer in 2010 Total Ford sales decline to 24% in 2010 GM / Chrysler growth driven by Interiors and Lighting content 2007E Customer Distribution - Consolidated Sales Customer Diversification - For
Slide 10: "2009 Imperative" - actions to reduce overhead structure
"2009 Imperative" - actions to reduce overhead structure Reductions in Administrative and Engineering structure through rightsizing, organizational model restructuring, outsourcing opportunities and other actions Objective linked to compensation $215M by end of 2010 30 facility actions Low cost regi
Slide 11: Progression to Profitability
Progression to Profitability Delivered Commitments 2007 2008 2009 2010 Significant Restructuring Free Cash Flow Positive Profitable Please see important disclosures regarding "Forward Looking Information". Our diverse customer base, combined with our innovation and market leading technology and... C
Slide 12: Continued Progress in 2007
Continued Progress in 2007 7 actions completed in 2007 Connersville successfully completed in December Progressing Bedford closure and disposition of Swansea operation Cumulative savings from actions on track - $420M Escrow funds of $143M available at 2007 YE for future actions (50/50 sharing) Manuf
Slide 13: 2008 and Forward
2008 and Forward Dynamic OE production environment N. America - negative W. Europe - slightly negative Asia (China, Korea) - positive Execution of our restructuring plan Substantial completion of actions in 2009 Escrow Account matching in effect Swansea sale expected to be completed in Q1 2008 Actio
Slide 14: Net New Business - 2008 - 2010
Net New Business - 2008 - 2010 Wins Losses Climate $ 400 Interiors $ 650 Electronics $ (370) 2008 - 2010 Net New Business - $730 Million Other $ 50 Steady growth in Climate and Interiors - $1.050 billion cumulative Ford resourcing actions adversely impacting Electronics ($ in millions) Lower by $600
Slide 15: Restructuring Actions
Restructuring Actions 11 7 18 8 4 30 Restructuring Timing - 30 Facilities Actions Restructuring Savings Summary ($ in millions) 2007 Actions Cumulative Gross Savings of $420M Please see important disclosures regarding "Forward Looking Information" and "Use of Non-GAAP Financial Information".
Slide 16: Overhead Cost Actions
Overhead Cost Actions Targeting further reductions in Administrative and Engineering cost structure - "2009 Imperative" Streamlined operating model key to achieving savings / efficiency gains Over 50+ actions identified to deliver savings - working with third party consultant to ensure successful im
Slide 17: Visteon at the 2008 NAIAS
Visteon at the 2008 NAIAS 2008 Cadillac CTS Lighting 2009 Dodge Ram Interiors, Climate 2008 Chevrolet Tahoe Lighting 2009 Ford F-150 Climate, Electronics 2008 Buick Enclave Lighting 2009 Hyundai Genesis Climate 2008 Chevrolet Malibu - 2008 Car of the Year Lighting 2008 Mazda CX-9 - 2008 Truck of the
Slide 18: Outlook Assumptions
Outlook Assumptions Still finalizing 2007 year-end results Our restructuring actions have a significant impact in our Outlook Production volumes generated at platform level from industry sources (e.g. CSM) and customer estimates Foreign exchange based on 3Q 2007 rates Impact of anticipated divestitu
Slide 19: 2007 Preliminary Estimates
2007 Preliminary Estimates Prior Current Product Sales $10.6 B $10.7 B EBIT-R $(65) M (+/- $15 M) $(60) M (+/- $5 M) Free Cash Flow Change in Securitization Guidance Free Cash Flow* $(290) M $ (60) M $(230) M +/- $30 M $(95) M $(70) M $(25) M (+/- $10 M) * Prior 2007 estimate for Free Cash Flow base
Slide 20: Outlook - Forward Years
Outlook - Forward Years 2008E 2009E Product Sales $9.7 B +/- $100 M $9.4 B +/- $100 M EBIT-R Breakeven +/- $25 M $200 M +/- $50 M Free Cash Flow $(300) M +/- $50 M $10 M +/- $100 M * Full year estimates for Free Cash Flow are based on receivables sales equal to the December 31, 2007 level of $99 mil
Slide 21: 2008E Production - Key Platforms
2008E Production - Key Platforms Hyundai / Kia $ 2.3 $ 740 Ford Europe $ 1.7 $ 800 Ford N. America $ 1.1 $ 420 Nissan NA (truck) $ 0.7 $2,100 PSA - Citroen $ 0.5 $ 250 Y/Y Units 5% Flat 6% CPV (2) Sales (1) 4% Flat (1) - Total 2008E sales - in billions (2) - Content Per Vehicle - 2008E average Custo
Slide 22: Product Sales - 2007 to 2009
Product Sales - 2007 to 2009 Key Drivers Volume / Mix / New Business All Other 2007E to 2008E $10.6 to $9.6 - $9.8 ($ in billions) Divestitures Closures $(0.6) $(0.4) $0.1 $ - $9.6 - $9.8 to $9.3 - $9.5 2008E to 2009E $(0.3) $0.1 $(0.1) Sales Decline by $900 Million Sales Decline by $300 Million Ple
Slide 23: EBIT-R - 2007 to 2009
EBIT-R - 2007 to 2009 Key Drivers $(60) to $(25) - $25 $(25) - $25 to $150 - $250 ($ in millions) Overhead Cost Actions Divestitures / Closures Net Cost Performance 2007E to 2008E 2008E to 2009E Volume / Mix / New Business Net Plant Restructuring $(95) $(75) $80 $70 $80 $(70) $ 15 $145 $80 $ 30 EBIT
Slide 24: Free Cash Flow
Free Cash Flow ($ in millions) Please see important disclosures regarding "Forward Looking Information" and "Use of Non-GAAP Financial Information".
Slide 25: 2007E to 2009E - Free Cash Flow
2007E to 2009E - Free Cash Flow ($ in millions) Please see important disclosures regarding "Forward Looking Information" and "Use of Non-GAAP Financial Information". * Midpoint of Guidance Range
Slide 26: Cash and Debt
Cash and Debt Term Loan 7.00% Sr. Notes 8.25% Sr. Notes Significant Debt Maturities Runway to execute plan No significant maturities until 2010 Continue to monitor capital structure opportunities, markets permitting YE 2007 debt of $2.8 billion $1,422 $1,750 Cash balance increase of about $330M Incl
Slide 27: Well Positioned for the Future
Well Positioned for the Future Liquidity $1.75B in cash - $1.5B in NA and Europe; no significant maturities until 2010 Value Perspective Visteon Position Diverse Sales - Customers and Geographies By 2010, total sales to Ford accounts for 24% of sales; Ford NA at 6% North America accounts for 31% of
Slide 28: Appendix
2008 Business Update and Outlook Automotive Analysts of New York January 17, 2008 Appendix
Slide 29: Product Group Highlights
2008 Business Update and Outlook Automotive Analysts of New York January 17, 2008 Product Group Highlights
Slide 30: Product Group Sales
Product Group Sales 2007E 2008E 2010E Total = $10.7 Billion Total = $9.7 Billion Total = $9.8 Billion Consolidated Sales Non-Consolidated Sales Total = $1.7 billion Total = $2.1 Billion Total = $3.2 Billion Please see important disclosures regarding "Forward Looking Information".
Slide 31: Climate
Climate Sales by Region ($ in billions) Position No. 2 in growing global climate segment Technology leader in key segments - compressors and alternate refrigerants Balanced global mix with significant presence in Asia Please see important disclosures regarding "Forward Looking Information". Customer
Slide 32: Electronics
Electronics Position NA reduction driven by declining share at Ford, particularly powertrain electronics Significant growth in non-consolidated sales in China/India JVs - market growth and migration of NA/EU production to China for improved margins $500M increase 2007 - 2010 Please see important dis
Slide 33: Interiors
Interiors Position Strong market position - #2 globally in cockpits, instrument panels and consoles Market leader in China - No. 1 position via YanFeng Visteon Unique footprint and full systems capabilities Please see important disclosures regarding "Forward Looking Information". $3.1 $3.2 $3.2 $3.5
Slide 34: Financial Disclosures
2008 Business Update and Outlook Automotive Analysts of New York January 17, 2008 Financial Disclosures
Slide 35: Use of Non-GAAP Financial Information
Use of Non-GAAP Financial Information Throughout this presentation, the Company has provided information regarding certain non-GAAP financial measures. These measures include "free cash flow," and "EBIT-R." Free cash flow represents cash flow from operating activities less capital expenditures. EBIT
Slide 36: EBIT-R and Free Cash Flow Reconciliation
EBIT-R and Free Cash Flow Reconciliation
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