Slide 1: FY 2020 Q1 Earnings Call
FY 2020 Q1 Earnings Call February 4, 2020
Slide 2: Agenda
Agenda TransDigm Overview and Highlights Nick Howley Executive Chairman Operating Performance, Market Review Kevin Stein and Outlook President and CEO Financial Results Mike Lisman CFO Q&A 1
Slide 3: Forward Looking Statements & Special Notice Regarding Pro Forma and Non-GAAP Information
Forward Looking Statements & Special Notice Regarding Pro Forma and Non‐GAAP Information FORWARD LOOKING STATEMENTS This presentation contains forward‐looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including information regarding our guidance for futur
Slide 4: TransDigm Overview (Includes Esterline)
TransDigm Overview (Includes Esterline) Distinguishing Characteristics Highly engineered aerospace components Significant aftermarket content Proprietary and sole source products High free cash flow Proprietary Revenues (1) Pro Forma Revenues (1) Pro Forma EBITDA As Defined (1) Non‐ Propriet
Slide 5: 2020 Q1 Financial Performance by Markets – Pro Forma (Includes Esterline)
2020 Q1 Financial Performance by Markets – Pro Forma (Includes Esterline) Highlights Q1 Review – Pro Forma Revenues⁽¹⁾ Actual vs. 20% Biz Jet/Heli Prior Year Q1 Commercial OEM: 80% Com Commercial OEM: Up 1% Transport Q1 ‘20 Commercial Transport Revenue Flat Q1 ’20 Business Jet/Helicopter Revenue
Slide 6: First Quarter 2020 Select Financial Results
First Quarter 2020 Select Financial Results ($ in millions, except per share amounts) Q1 FY Q1 FY 2020 2019 Revenue $1,465 $993 47.5% Increase • 8.7% organic sales growth • Lower Esterline gross margins vs. legacy TDG Gross Profit $801 $564 ‐2.1% Margin Decrease • Legacy TDG business margins expande
Slide 7: Fiscal 2020 Outlook
Fiscal 2020 Outlook Market Growth Assumptions – No Change from Original FY20 Guidance FY 2019 Pro Forma FY 2020 Expected Sales Mix (1) Market Growth (2) 32% Commercial OEM Up LSD to MSD% 31% Commercial Aftermarket Up MSD to HSD% 37% Defense Up MSD% Misc. Financial Assumptions Full year net interes
Slide 8: Fiscal 2020 Outlook
Fiscal 2020 Outlook Guidance Summary ($ in millions) FY 20 Current Guidance FY 20 Guidance Midpoint Change Low High Current Prior ∆ Revenues (1) $ 6,175 $ 6,325 Revenues (1) $ 6,250 $ 6,250 $ ‐ EBITDA As Defined (1) $ 2,775 $ 2,875 EBITDA As Defined (1) $ 2,825 $ 2,825 $ ‐ % of sales 44.9% 45.5% % o
Slide 9: Reconciliation of Fiscal 2020 Outlook
Reconciliation of Fiscal 2020 Outlook ($ in millions, except per share amounts) FY 2020 Guidance Midpoint Net income $ 1,040 Adjustments: Includes approx. $62m Depreciation and amortization expense 302 of backlog amortization Interest expense ‐ net 1,020 Income tax provision 317 EBITDA 2,679 Adjustm
Slide 10: Liquidity & Taxes
Liquidity & Taxes ($ in millions) Cash Pro Forma Capital Structure Q1 FY 20 FY 19 12/28/19 9/30/19 Pro forma capitalization Actual Pro forma (1) ($ in millions) 12/28/19 Adj. 12/28/19 Rate Net Cash Provided by $433 $1,029 Cas h $4,194 ($1,864) $2,330 Operating Activities $760mm revolver – – – L + 3.
Slide 11: Reconciliation of GAAP to Adjusted EPS - Guidance
Reconciliation of GAAP to Adjusted EPS ‐ Guidance Full Year Guidance Thirteen Week Periods Ended Mid‐Point December 28, December 29, September 30, 2019 2018 2020 GAAP earnings per share $ 0.83 $ 3.05 $ 14.90 Adjustments to earnings per share: Dividend equivalent payments 3.22 0.43 3.22 Acquisition‐r
Slide 12: Appendix: Reconciliation of Net Income to EBITDA and EBITDA As Defined
Appendix: Reconciliation of Net Income to EBITDA and EBITDA As Defined ($ in millions) Thirteen Week Periods Ended December 28, 2019 December 29, 2018 Net income including noncontrolling interests $ 305 $ 196 (1) Less: Income from discontinued operations, net of tax 71 ‐ 234 196 Income from continui
Slide 13: Appendix: Reconciliation of Reported EPS to Adjusted EPS
Appendix: Reconciliation of Reported EPS to Adjusted EPS ($ in millions, except per share amounts) Thirteen Week Periods Ended Reported Earnings Per Share December 28, 2019 December 29, 2018 Income from continuing operations including noncontrolling interests $ 234 $ 196 Less: Net income attributabl
Slide 14: Appendix: Reconciliation of Net Cash Provided by Operating Activities to EBITDA
Appendix: Reconciliation of Net Cash Provided by Operating Activities to EBITDA and EBITDA As Defined ($ in millions) Thirteen Week Periods Ended December 28, 2019 December 29, 2018 Net cash provided by operating activities $ 433 $ 330 Adjustments: Changes in assets and liabilities, net of effects f