Materion Corporation · NYSE:MTRN
Materion — Shareholder Meeting (May 2013)
22 slides from Materion's shareholder meeting presentation, May 1, 2013
Slide 1: Materion Corporation 2013 Annual Meeting of Shareholders
MATERION CORPORATION 2013 ANNUAL MEETING OF SHAREHOLDERS MAY 1, 2013 Exhibit 99.2
Slide 2: Forward-Looking Statements
Forward-Looking Statements These slides contain (and the accompanying oral discussion will contain) “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that could ca
Slide 3: Another Year of Progress
MATERION CORPORATION 2013 ANNUAL MEETING OF SHAREHOLDERS MAY 1, 2013 Another Year of Progress
Slide 4: We Faced and Squarely Addressed a Number of Challenges in 2012
We Faced and Squarely Addressed a Number of Challenges in 2012 ■ Weak global economy ■ Beryllium pebble plant ramp-up ■ Integration of EIS Optics acquisition ■ Physical inventory adjustment ■ Operations consolidation ■ Response building a stronger Company 4
Slide 5: Business Levels Declined Modestly in 2012
Business Levels Declined Modestly in 2012 ■ Sales were $1.27 billion for 2012, down from $1.53 billion in 2011 ■ All but 3% of the year-over-year sales decline was due to pass- through metal 5 Stronger Markets Weaker Markets Commercial Aerospace Telecommunications Infrastructure Medical Defense & Sc
Slide 6: Profits Were Below Prior Year Levels
Profits Were Below Prior Year Levels ■ Net Income was $24.7 million ■ EPS was $1.19 ■ Driven by specific factors noted earlier ■ Year ended with a welcomed improvement in business levels ■ Improving conditions in a number of markets ■ We entered 2013 with reasons for optimism 6
Slide 7: Our Balance Sheet Remains Very Strong
Our Balance Sheet Remains Very Strong ■ Debt-to-debt-plus-equity at 19% ■ On-going positive cash generation, very strong in the fourth quarter ■ Past 5 years, cash from operations was $30 - $75 million annually ■ Acquired AMC in March 2012 ■ Cumulative investment of approximately $220 million over 7
Slide 8: We Are Increasing Our Quarterly Dividend
We Are Increasing Our Quarterly Dividend ■ Our dividend, on an annualized basis, will increase by 7%, or $0.02, to $0.32 per share ■ Reinforces our confidence in −Growth prospects − Ability to convert growth to earnings −Cash to reinvest in the business −Return cash to shareholders 8
Slide 9: Initiation of Value-Added Sales Reporting
Initiation of Value-Added Sales Reporting ■ At company and segment level ■ Offers more information to investors ■ More effective, more transparent communication of the health of our businesses ■ Removes potential distortion in trends in business levels and margins 9
Slide 10: Optimism Continues into the First Quarter 2013
Optimism Continues into the First Quarter 2013 ■ Year is off to a good start ■ The first quarter met our expectations ■ Net income was $0.33 per share, an 11% increase ■ The beryllium pebble plant had its highest production since 2011 startup ■ Order entry rates increased, were 6% above second half
Slide 11: Standing by Our Full-year EPS Guidance
■ We will face several headwinds during 2013 −Headwinds in pension and compensation plans −Risks implementing initiatives ■ Nevertheless, we also expect significant growth −Improving operations and sales volume at the beryllium plant −Improving order entry and margin trends across the business −Exci
Slide 12: Materion Corporation 2013 Annual Meeting of Shareholders
MATERION CORPORATION 2013 ANNUAL MEETING OF SHAREHOLDERS MAY 1, 2013
Slide 13: 2013 Momentum Building – Lift in Markets
2013 Momentum Building – Lift in Markets ■ Consumer Electronics – Semi-conductors in handsets and tablets ■ Telecom Infrastructure – Electronics packaging and wire ■ Oil & Gas – ToughMet® in oil and gas drilling 13
Slide 14: 2013 Momentum Building – Lift in Markets
2013 Momentum Building – Lift in Markets ■ Automotive Electronics – High-intensity electronics ■ Commercial Aerospace – Record order entry rate ■ Medical – Outpacing market growth rate ■ Defense and Science – Picking up and solid for 2013 14
Slide 15: Progress on Strategic Initiatives
Progress on Strategic Initiatives ■ Beryllium Pebble Plant – On track to meet 2013 production targets ■ Operational Restructurings – Closure of 5 facilities, relocation of business closer to customer in Singapore – Net cost neutral in 2013 – $0.20/share benefit in 2014 ■ Westford Large Optics Capabi
Slide 16: Progress on Strategic Initiatives
Progress on Strategic Initiatives ■ Amorphous Metals/Liquidmetal – Wide range of end-use performance benefits ■ AMC Augmentation – Technology platform & I.P. portfolio – Niche market opportunities ■ Procurement and Pricing – Capturing the value potential of our materials ■ Common Systems and Shared
Slide 17: Product and Technology Pipeline
Product and Technology Pipeline ■ LED’s – Phosphors ■ Precision Optical Filter Arrays ■ Gesture Control Technology – Leveraging our capabilities to enable technology ■ Coatings for Architectural Glass 17
Slide 18: Product and Technology Pipeline
■ ToughMet® Strip – Camera voice coil motor • Smart phones and tablets – Thin-walled wrap bearings ■ Dovetail Clad – Technical Materials – Start-stop “mild hybrid” systems – Facilitates high-volume laser welding in lithium-ion battery packs ■ Amorphous/Liquidmetal ■ Acoustic Beryllium – Expanding to
Slide 19: Successful Repositioning: 2002-2012 Snapshot
Successful Repositioning: 2002-2012 Snapshot ■ Revenue has grown significantly ■ Multiple acquisitions ■ Major capital investments ■ Dramatically lower debt ■ Much greater capital efficiency 19
Slide 20: Financial Goals for the Next Years
Financial Goals for the Next 3 – 5 Years 20 Value-added sales growth >8% Gross margins (value-added basis) 35% – 40% Operating margins (value-added basis) 12% – 16% Working capital % sales <20% Debt-to-Debt-Plus-Equity <30% ROIC (pre-tax) >18%
Slide 21: We Are Well Positioned
We Are Well Positioned ■ Offering a formidable set of distinctive – yet synergistic – competencies ■ Focusing on high-growth niches of long term secular growth markets ■ Becoming our customers' first choice by providing value through our technological capabilities, service and speed ■ Driving operat
Slide 22: Materion Corporation 2013 Annual Meeting of Shareholders
MATERION CORPORATION 2013 ANNUAL MEETING OF SHAREHOLDERS MAY 1, 2013