AM Castle & — Investor Presentation (March 2014)
32 slides from AM Castle &'s investor presentation, Mar 17, 2014
Slide 1: Form 8-K Current Report - A. M. Castle & Co.
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report: March 17, 2014 (Date of earliest event reported) A. M. CASTLE & CO. (Exact name of registrant as specified in its cha
Slide 2: Item 7.01 Regulation FD Disclosure
Item 7.01. Regulation FD Disclosure In accordance with General Instruction B.2 to Form 8-K, the following information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Se
Slide 3: Signatures
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. A.M. CASTLE & CO. March 17, 2014 By: /s/ Jeffrey S. Torf Jeffrey S. Torf Vice President, Interim General
Slide 4: Exhibit Index
EXHIBIT INDEX Exhibit No. Description Page Number 99.1 Investor Presentation dated March 2014 EX-1 3
Slide 5: Exhibit 99.1 - Investor Presentation March 2014
EXHIBIT 99.1 A. M. Castle & Co. March 2014 NYSE: CAS A.M. Castle & Co. EX-1-
Slide 6: Forward Looking Statements
Forward Looking Statements Information provided and statements contained in this presentation that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), Section 21E of the Securities Exchange Act of 19
Slide 7: Regulation G & Other Cautionary Notes
Regulation G & Other Cautionary Notes This presentation includes non-GAAP financial measures to assist the reader in understanding our business. The non-GAAP financial information should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in acco
Slide 8: One of the largest metal service center companies in the U.S.
® * One of the largest metal service center companies based in the U.S. with $1.1 billion in 2013 annual net sales * Specialty Products, Specialty Services, Customized Supply Chain Solutions * Strong exposure to long-term growth end markets including Oi! & Gas, Aerospace and Industrial * Supplying o
Slide 9: Value Added Services & Solutions
Value Added Services & Solutions Serving Vital Link in Global Metal Supply Chain A.M. Castle Global OEMs * Many global distribution points * Demand delivery of oo 7 products within short * Robust fabrication services ‘ timeframe * Flexibility in order sizes iNeed forapacialized products and services
Slide 10: Specialty Grade, High Value Metals
GO a") Specialty Grade, High Value Metals Diversified Product Offering with Focus on Specialty Materials * Sales focused on primarily , “4 as it highly specialized product =) | Other, 9% ro offering yf * A.M. Castle average selling price of $3,500 - $4,000 per 7 ton compared to an average 2 commodit
Slide 11: Diversified Global End Markets
Diversified Global End Markets Global Demand Driving Growth in Key End Markets Markets Served (2013 Net Sales) Industrials Industrials Oil & Gas Aerospace Plastics . Primarily focused * Positioned to * Specialty products + Supply Oil & Gas onheavy succeed with and supply chain thousands of equipment
Slide 12: Broad Geographic Footprint Serving Global Markets
a") Broad Geographic Footprint Serving Global Markets = = i? a & @ METALS BRANCH i @ METALS SALES OFFICE fi a @ PLASTICS BRANCH lM CORPORATE OFFICE Source: 2013 Form 10-K EX-8-
Slide 13: Serving a Broad Range of Diverse Customers
Serving a Broad Range of Diverse Customers GENERAL DYNAMICS ( sPx YD AIRBUS Johnson Y))G pe ee Controls (&) JOHN DEERE { SORING A 8 - & JO) GE Energy JOY MINING MACHINERY A Joy Global Inc. Company BALDOR Gulfstream’ A | LOCKHEED MARTIN A GENERAL DYNAMICS COMPANY Cc % United Tochnologics A.M. Castle
Slide 14: Supplier Partners
a") Supplier Partners Stable supplier base values A. M. Castle as a key customer and provides access to specialty metals Product Category Supplier Y¥ Aluminum * Kaiser Aluminumand Alcoa Y Alloy * Timken, Tenaris and Republic ‘ : * Allegheny, Special Metals and v Nickel & Stainless Naith AmartcaniSta
Slide 15: Quarterly Net Sales Trend
Quarterly Net Sales Trend (¢s in minions) 1Q'10 | 2Q'10 | 3Q'10 | 4Q'10 |1Q'11 | 2Q'11) 3Q'11 |4Q'11 |1Q'12 |2Q'12 | 3Q'12 |4Q'12 | 1Q'13 |2Q'13 | 3Q'13 |4Q'13 F MmmmRevenue| $223 | $240 | $245 | $236 | $273 | $282 | $295 | $282 | $363 | $329 | $304 | $274 | $293 | $273 | $254 | $233 <—@PMi 57 58 57
Slide 16: Organizational Objectives
‘© a") rganizational Objectives Nimble Business Customer Centric Faster and easier todo business with More focused than ever on the customer Engaged Employees Earna reputation for employees _| who share ideas, best practices and process improvements Highly competitive in our end .| markets Path to s
Slide 17: Profit Improvement
Profit Improvement °$33 million of run-rate improvements implemented in 2013 Goals Action Steps Targeted Annua Operating Profit Improvement enhancement * Leveraged metal sourcing and strategic pricing opportunities Operating * Assigned new leadership over operations $10 million Functions * Consolida
Slide 18: Vertical Sales and Support Structure
Vertical Sales and Support Structure GO Vertical sales teams and consolidated support functions to drive better service to customers, greater flexibility and improved coordination. Aerospace Oil & Gas Centralized Sales Su and Strategic Sour: * Hired new Chief Commercial Officer in July 2013 * Reorga
Slide 19: Financial and Operating Targets
Financial and Operating Targets Lower Operating Expenses 22% operating expense ratio* by end of 2014 *operating expenses as a percentage of net sales Higher Operating Profits 10% operating profit in normal market conditions Lower Days Sales in Inventory 150 days by end of 2014 Fortify Balance Sheet
Slide 20: Financial Overview
Financial Overview A.M. Castle & Co. 16 EX-16-
Slide 21: Sales Trends
Sales Trends ¢ Sales declined in 2013 following the weak PMI trend across the industrial markets in 2012 and the first half of 2013. ¢ New sales support structure positions Company well to gain share as market growth returns Annual Net Sales ($ in millions) ($ in millions) $1,600 5 $400 5 $363 $1,27
Slide 22: Focused on Improving Cash Flows
Focused on Improving Cash Flows Adjusted EBITDA* ($ in millions) $80 5 $75 $(11.6) ~$30 -$(97,5) pare an aad aie 10'12 2012 30°12 40'12 10'13 20°13 30'13 4Q'13 e Focused on cash flow generation and debt reduction. — Minimal capital expenditures required — typically 1% of revenue. — Significant impro
Slide 23: Key Balance Sheet Items
Key Balance Sheet Items ($ in 000s) December 31, 2013 December 31, 2012 Cash and Cash Equivalents $30,829 $21,607 Accounts Receivable 128,544 138,311 Inventory, net of LIFO reserves (*) 214,900 303,772 Other Current Assets 16,418 22,688 Total Current Assets $ 390,691 $ 486,378 Accounts Payable (69,5
Slide 24: Next Step, Improve Working Capital Measurements
a") Next Step, Improve Working Capital Measurements Inventory — DSI 200 5 187 180 Days 2011 2012 2013 2011 2012 2013 ¢ Focused on significantly improving both DSI and DSO over the next several quarters + 150 DSI target for 2014 ALM: Castle 8 Co: = EX-20-
Slide 25: Improving Financial Position
Improving Financial Position Total Debt-to-Capital 50.2% 46.8% 44.3% 44% ° 42% 40% + . Dec ‘11 Dec ‘12 Dec '13 C ee Less: Cash Balances Focus on cash flow generation has paid off with lower leverage anda stronger balance sheet Net debt reduction of $60 million in fiscal year 2013 Remain focused on c
Slide 26: Investment Highlights
Investment Highlights Increased customer Increased global penetration presence and capabilities Attractive financial position and cash flow characteristics Experienced management team Extensive supplier ; Proven track record relationships of performance EX-22- Specialty high value products & service
Slide 27: Appendix
a) APPENDIX _A.M. Castle & Co. 23 EX-23-
Slide 28: Annual and YTD Financial Business Trends As Reported
Annual and YTD Financial Business Trends As Reported 6 in mitions, except EPS) Net Sales $1,600 $1,200 $800 $400 $0 Diluted EPS -$0.10 -$0.30 -$0.50 -$0.70 -$0.90 -$1.10 -$1.30 -$1.50 2010 $(0.25) 2010 2011 $(0.08) 2011 2012 $(0.42) 2012 2013 $(1.46) 2013 EBITDA* $80 $74 $20 2010 2011 2012 2013 Oper
Slide 29: Quarterly Financial Business Trends As Reported
Quarterly Financial Business Trends As Reported (sin mitlions, except EPS) GO Net Sales $400 > $363 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 Diluted EPS $0.35 $0.25 $0.15 $0.05 -$0.05 -$0.15 -$0.25 -$0.35 -$0.45 -$0.55 $(0.19) $(0.54) 1Q'12 2Q'12 3Q'12 4Q'12 1013 2Q'13 3Q'13 4Q'13 EBITDA* $30
Slide 30: Liquidity and Balance Sheet
a") iquidity and Balance Sheet SELECTED CONSOLIDATED RESULTS Year Ended December 31, 2013 2012 Cash From (Used in) Operations $ 744 $ 5.4 Cash Paid for CapEx $ (11.6) $ (11.1) Avg Days Sales in Inventory 180.0 187.0 Avg Receivables Days Outstanding 51.1 49.0 SELECTED CONSOLIDATED RESULTS ($ in Milli
Slide 31: Non-GAAP Reconciliation
Non-GAAP Reconciliation Reconciliation of EBITDA to Net Loss/Income ($in millions) Unaudited Net (Loss)/Income $ (43) $ (3.0) $ 32 $ (5.6) $ (10.6) $ (3.8) $ (6.9) $ (12.7) Depreciation and Amortization Expense 6.6 6.5 6.3 6.5 6.6 6.6 6.4 6.6 Interest Expense, Net 10.2 10.0 10.2 10.6 10.2 10.1 10.2
Slide 32: Thank You
Thank You NYSE: CAS A.M. Castle & Co. EX-28-