Slide 1: FY 2015 Third Quarter Earnings Call
FY 2015 THIRD QUARTER EARNINGS CALL August 4, 2015
Slide 2: Agenda
Agenda TransDigm Overview W. Nicholas Howley Chairman and CEO Highlights, Market Review, Operating W. Nicholas Howley Performance and Outlook Chairman and CEO Financial Results Terrance Paradie Executive Vice President and Chief Financial Officer Q&A 1
Slide 3: Forward Looking Statements
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 future periods. These forward-looking statements are based on management’s current expectation
Slide 4: Special Notice Regarding Pro Forma and Non-GAAP Information
Special Notice Regarding Pro Forma and Non-GAAP Information This presentation sets forth certain pro forma financial information. This pro forma financial information gives effect to certain recently completed acquisitions. Such pro forma information is based on certain assumptions and adjustments a
Slide 5: TransDigm Overview
TransDigm Overview DISTINGUISHING CHARACTERISTICS Highly engineered aerospace components Significant aftermarket content Proprietary and sole source products High free cash flow Proprietary Pro Forma Revenues Pro Forma EBITDA Revenues (1) (Excluding Non-Aviation Segment) (1) As Defined (1) N
Slide 6: 2015 Q3 Financial Performance by Markets – Pro Forma
2015 Q3 Financial Performance by Markets – Pro Forma Highlights⁽¹⁾ Q3 Market Review – Pro Forma Revenues⁽¹⁾ Actual vs. Prior Year Q3 YTD Commercial OEM Commercial OEM: Up 1% Up 5% Commercial transport revenue up 6% YTD Commercial Aftermarket: Up 3% Up 5% Commercial Aftermarket Sequential QTR rev
Slide 7: Fiscal 2015 Outlook
Fiscal 2015 Outlook FY 2014 Pro Forma Sales Mix (1) Market FY 2015 Expected Growth 32% Commercial OEM Up Mid Single-Digit % 39% Commercial Aftermarket Up Mid Single-Digit % 29% Defense Up Mid Single-Digit % Assumptions Guidance Summary ($ in millions) Worldwide RPM growth ≈ 4% to 5% Low High Ful
Slide 8: Third Quarter 2015 Results
Third Quarter 2015 Results ($ in millions, except per share amounts) Q3 FY15 Q3 FY14 Revenue $691.4 $610.6 13.2% Increase Gross Profit $359.5 $327.5 1.6 Margin Point Decrease Margin % 52.0% 53.6% ● Dilutive impact from acquisitions ● Strength of our proprietary products and productivity improvements
Slide 9: Liquidity & Taxes
Liquidity & Taxes ($ in millions) Cash Liquidity Net Debt to Pro YTD 6/27/2015 FY 9/30/2014 Actual Forma EBITDA As Net Cash Provided by 6/27/2015 Defined Multiple Rate Operating Activities $373.4 $541.2 Cash $915 Capital Expenditures ($40.2) ($34.1) $550m revolver – L + 3.00% Free Cash Flow $333.2 $
Slide 10: Reconciliation of GAAP to Adjusted EPS - Guidance
Reconciliation of GAAP to Adjusted EPS - Guidance Thirteen Week Periods Full Year Guidance Ended Thirty-Nine Week Periods Ended Mid-Point June 27, June 28, June 27, June 28, September 30, 2015 2014 2015 2014 2015 Earnings per share $ 1.75 $ (1.66) $ 5.34 $ 1.26 $ 7.53 Adjustments to earnings per sha
Slide 11: Appendix - Reconciliation of Net Income to EBITDA and EBITDA As Defined
Appendix - Reconciliation of Net Income to EBITDA and EBITDA As Defined ($ in thousands) Thirteen Week Thirty-Nine Week Periods Ended Periods Ended June 27, June 28, June 27, June 28, 2015 2014 2015 2014 Net income $ 99,112 $ 16,177 $ 305,539 $ 192,655 Adjustments: Depreciation and amortization expe
Slide 12: Appendix - Reconciliation of Reported EPS to Adjusted EPS
Appendix - Reconciliation of Reported EPS to Adjusted EPS ($ in thousands, except per share amounts) Thirteen Week Thirty-Nine Week Periods Ended Periods Ended June 27, June 28, June 27, June 28, Reported Earnings Per Share 2015 2014 2015 2014 Net income $ 99,112 $ 16,177 $ 305,539 $ 192,655 Less: d
Slide 13: 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 thousands) Thirty-Nine Week Periods Ended June 27, 2015 June 28, 2014 Net cash provided by operating activities $ 373,427 $ 349,529 Adjustments: Changes in assets and liabilities, net of effe