Slide 1: FY 2022 Fourth Quarter Earnings Call
FY 2022 Fourth Quarter Earnings Call November 4, 2022 Adient – PUBLIC
Slide 2: Important Information
Important Information Adient has made statements in this document that are forward-looking and, therefore, are subject to risks and uncertainties. All statements in this document other than statements of historical fact are statements that are, or could be, deemed “forward- looking statements” withi
Slide 3: Agenda
Agenda > Introduction Mark Oswald VP, Treasurer & Investor Relations > Business Update Doug Del Grosso President and CEO > Financial Review Jeff Stafeil Executive VP and CFO > Q&A FY2022 Fourth Quarter Earnings Call Adient – PUBLIC Nov. 4, 2022 3
Slide 4: Remaining focused
Navigating through the current operating environment A volatile and significantly reduced vehicle production environment (resulting from continued supply chain disruptions) as well as rising energy and input costs continue to have a significant Key Q4FY22 External factors impact on the industry and
Slide 5: Focused strategy driving forward progress
Focused strategy driving forward progress Leading supplier focused on Driving operational and Strengthening our Creating a sustainable automotive seating financial improvements leading position future together > Global reach and scale > Intense focus on launch > Significant EV wins across the > Comm
Slide 6: Enhancing Adient's capital allocation plan
Enhancing Adient’s capital allocation plan > The ability to drive the business forward despite the challenging operating environment has enabled the company to enhance its capital allocation plan > Adient’s capital allocation plan has prioritized deleveraging; on track and progressing towards the co
Slide 7: Strengthening our leading position and solidifying supplier of choice status
Strengthening our leading position and solidifying supplier of choice status > Adient is successfully balancing significant commercial discussions (recoveries) with customers while winning new and replacement business across the customer base, including legacy makers and new entrants > Business sour
Slide 8: In process and upcoming launches
In process and upcoming launches > Launch execution continues to underpin supplier of choice status; Launch volume and complexity intense focus on launch process is laying the foundation for FY23 vs. FY22 Adient’s success Volume Complexity > ~90% of FY22 launches passed stringent “flawless” launch e
Slide 9: Looking ahead…
Looking ahead… > The accomplishments achieved in FY22, which include but are not limited to, significant program wins, high quality launches, actions to further reduce costs, and just under $1B of debt paydown enables Adient to enter FY23 from a position of strength > That said, FY23 will likely con
Slide 10: Confidence in a bright future
Confidence in a bright future > Adient operations are performing well outside of temporary operating inefficiencies > The company is focused and executing its strategy which is expected to position Adient for sustained, long-term success > The accomplishments achieved in FY22 enable Adient to enter
Slide 11: Financial Review
Financial Review FY2022 Fourth Quarter Adient – PUBLIC
Slide 12: "Fine tuning" China operations
“Fine tuning” China operations > Adient’s Q4FY22 and future financial results (equity income and consolidated income) impacted by a change to a shareholder’s agreement at Adient’s Keiper joint venture Key outcome and benefits of > As a reminder, over last several years, Adient has transformed China
Slide 13: Q4 FY2022 Key Financials
Q4 FY2022 Key Financials As Reported As Adjusted 1 $ millions, except per share data Q4 FY22 Q4 FY21 Q4 FY22 Q4 FY21 B/(W) Consolidated $ 3,650 $ 2,771 $ 3,650 $ 2,771 32% Revenue $2,950 Q4FY21 pro forma adjusted for EBIT $ 138 $ 1,170 $ 144 $ 43 NM strategic/footprint actions Margin 3.8% NM 3.9% 1.
Slide 14: FY2022 Full Year Key Financials
FY2022 Full Year Key Financials As Reported As Adjusted 1 $ millions, except per share data FY22 FY21 FY22 FY21 B/(W) Consolidated $ 14,121 $ 13,680 $ 14,121 $ 13,680 3% $14,300 pro forma Revenue adjusted for strategic/footprint EBIT $ 259 $ 1,726 $ 348 $ 596 (42)% actions Margin 1.8% 12.6% 2.5% 4.4
Slide 15: Q4 FY2022 Revenue: Consolidated and Unconsolidated Sales
Q4 FY2022 Revenue: Consolidated and Unconsolidated Sales Regional Performance Consolidated sales (consolidated sales y-o-y growth (vs. Q4 FY21 pro forma) by region) 1, 2, 3 $897 Includes $72M of Q4 S&P material economics Q4 recoveries Production $(197) Americas 33.3% 25.8% $3,650 EMEA 35.9% 30.9% $1
Slide 16: Q4 FY22 Adjusted-EBITDA
Q4 FY22 Adjusted-EBITDA Q4FY22 adjusted EBITDA of $227M, up $157M y-o-y (adjusting for portfolio $85 $1 actions executed in FY21) $118 $(32) $ in millions $(15) Key drivers of the y-o-y comparison: > Volume and mix was an approximately ~$118M tailwind in the quarter $227 as production improved, as e
Slide 17: Cash flow
Cash flow Free Cash Flow (1) Key drivers impacting FY22 FCF: (-) Lower consolidated y-o-y earnings (driven FY22 FY21 by lower volumes -- primarily supply chain (in $ millions) Q4 FY22 YTD Q4 FY21 YTD related) Adjusted-EBITDA (Excl. Equity income) $ 206 $ 587 $ 33 $ 646 (-) Lower cash dividend result
Slide 18: Debt and capital structure
Debt and capital structure Net Debt ($ in millions) 9/30/2022 Cash & Debt Profile Amount September 30 September 30 Cash & Cash Equivalents $ 947 (in $ millions) 2022 2021 ABL Revolver, incl. FILO due 2024 (1) - Cash $ 947 $ 1,521 Term Loan B due 2028 988 Total Debt 2,578 3,696 9.00% Secured Notes du
Slide 19: Financial Outlook FY 2023
Financial Outlook FY 2023 Adient – PUBLIC
Slide 20: Likely factors expected to influence FY23 results
Likely factors expected to influence FY23 results Key production assumptions (October S&P Global estimates) Sales and volume projections are generally FY22 S&P FY23 Sales Sales / Volume underpinned by October S&P estimates (units in millions) FY23 Plan y-o-y ∆ y-o-y % actual (FX adj.) N. America 15.
Slide 21: FY23 Outlook – key financial metrics
FY23 Outlook – key financial metrics > FY23 guidance reflects current market conditions (i.e., Consolidated sales ~$14.7B Oct. S&P production estimates, current FX rates, etc.) > Consolidated sales of ~$14.7B (up 4.1% y-o-y or 10.1% FX Adj.-EBITDA ~$850M adjusted); represents ~600 bps growth over ma
Slide 22: Appendix and financial reconciliations
Appendix and financial reconciliations FY 2022 Fourth Quarter Adient – PUBLIC
Slide 23: Q4 FY22 Adjusted-EBITDA: Americas
Q4 FY22 Adjusted-EBITDA: Americas Q4FY22 of $117M, up $105M y-o-y (adjusting for portfolio actions executed in FY21) Key drivers of the y-o-y comparison: > Improved volume and mix of ~$61M resulting $ in millions $2 from modestly improving customer production $3 $117 $45 > Improved business performa
Slide 24: Q4 FY22 Adjusted-EBITDA: EMEA
Q4 FY22 Adjusted-EBITDA: EMEA Q4FY22 of $34M, up $43M y-o-y (adjusting for $ in millions portfolio actions executed in FY21) Key drivers of the y-o-y comparison: $4 > Improved business performance of ~$44M, $24 driven by: > Net material margin performance improvement of ~$44M primarily driven by $(1
Slide 25: Q4 FY22 Adjusted-EBITDA: Asia
Q4 FY22 Adjusted-EBITDA: Asia Q4FY22 of $100M, up $16M y-o-y (adjusting for portfolio actions executed in FY21) $ in millions Key drivers of the y-o-y comparison: > Favorable volume and mix impact of ~$33M, $122 $33 driven primarily by the improved production environment $100 > FX was an approximate
Slide 26: Non-GAAP financial measurements and pro-forma reconciliations
Non-GAAP financial measurements and pro-forma reconciliations Adjusted EBIT, Adjusted EBIT margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income attributable to Adient, Adjusted effective tax rate, Adjusted earnings per share, Adjusted equity income, Adjusted interest expense, Free ca
Slide 27: Non-GAAP Reconciliations - EBIT, Adj.-EBIT, Adj.-EBITDA, and Adj.-Equity Income
Non-GAAP Reconciliations - EBIT, Adj.-EBIT, Adj.-EBITDA, and Adj.-Equity Income Three months ended September 30 Twelve months ended September 30 2022 2021 2022 2021 (in $ millions) GAAP Adj. Adjusted GAAP Adj. Adjusted GAAP Adj. Adjusted GAAP Adj. Adjusted Net sales $ 3,650 $ - $ 3,650 $ 2,771 $ - $
Slide 28: Non-GAAP Reconciliations - Adjusted Net Income and Adjusted EPS
Non-GAAP Reconciliations - Adjusted Net Income and Adjusted EPS Adjusted Net Income Adjusted Diluted EPS Three Months Ended Twelve Months Ended Three Months Ended Twelve Months Ended September 30 September 30 September 30 September 30 (in $ millions) 2022 2021 2022 2021 2022 2021 2022 2021 Net incom
Slide 29: Non-GAAP Reconciliations - Adjusted Income before Income Taxes and Effective Tax Rate
Non-GAAP Reconciliations - Adjusted Income before Income Taxes and Effective Tax Rate Adjusted Income before Income Taxes Three Months Ended September 30 Twelve Months Ended September 30 (in $ millions) 2022 2021 2022 2021 Income (loss) Income (loss) before Income Tax impact Effective before Income
Slide 30: Non-GAAP Reconciliations - Pro forma fiscal year 2021 reconciliations
Non-GAAP Reconciliations - Pro forma fiscal year 2021 reconciliations (in $ millions) Net Sales Q1 Q2 Q3 Q4 FY2021 Adjusted EBITDA Q1 Q2 Q3 Q4 FY2021 Americas - as reported: $ 1,737 $ 1,644 $ 1,440 $ 1,343 $ 6,164 Americas - as reported: $ 132 $ 64 $ 23 $ 13 $ 232 Americas footprint actions (20) - -
Slide 31: Segment Performance
Segment Performance Q1 2021 Q1 2022 Corporate/ Corporate/ Americas EMEA AP Consolidated Americas EMEA AP Consolidated Eliminations Eliminations Net Sales 1,737 1,604 554 (47) 3,848 1,498 1,230 784 (32) 3,480 Adjusted EBITDA 132 114 151 (19) 378 9 43 114 (20) 146 Adjusted Equity Income - 3 91 - 94 (1