Icahn Enterprises L.p. · NASDAQ:IEP
Icahn Enterprises L.p — Debt Investor Presentation (January 2014)
45 slides from Icahn Enterprises L.p's debt investor presentation, Jan 6, 2014
Slide 1: Icahn Enterprises L.P. Roadshow Presentation January 2014
Icahn Enterprises L.P. Roadshow Presentation January 2014
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward - Looking Statements and Non - GAAP Financial Measures Forward - Looking Statements This presentation contains certain statements that are, or may be deemed to be, “forward - looking statements” within the meaning of Section 27 A of the Securities Act of 1933 , as amended, and Section 21 E o
Slide 3: Presenters
Presenters Dan Ninivaggi – President & CEO Keith Cozza – Executive Vice President SungHwan Cho – Chief Financial Officer 3
Slide 4: Agenda
Agenda Transaction Overview Company Overview Investment Highlights Financial Performance Appendix 4
Slide 5: Transaction Overview
Transaction Overview
Slide 6: Sources and Uses of Funds
Sources and Uses of Funds New Bonds $3.50 Current 7.75% Tranche of Debt $1.05 Cash on Balance Sheet 0.15 Current 8.00% Tranche of Debt 2.45 Tender Premiums and Accrual of Unpaid Interest 0.13 Financing Fees and Expenses 0.02 Total Sources $3.65 $3.65 Sources of Funds Uses of Funds Executive Summary
Slide 7: Capitalization as of September 30, 2013
($Millions) Liquid Assets: Holding Company Cash and Cash Equivalents 958$ Holding Company Investment in Funds 3,569 Holding Company Liquid Assets 4,527 Subsidiaries Cash & Cash Equivalents 2,316 Total Liquid Assets 6,843$ Holding Company Debt: 6% Senior Unsecured Notes due 2020 493$ 8% Senior Unsecu
Slide 8: Summary of Terms
Summary of Terms Issuers Icahn Enterprises L.P. and Icahn Enterprises Finance Corp. (“IEP” or the “Company”) Issue $3.5Bn of Senior Notes Term 3 - Year 5 - Year Add - on 6% Notes due 2020 Optional Redemption Callable at Par One Month Prior to Maturity NC - 2.5 Make - Whole Premium plus T + 50 Feb 1,
Slide 9: Company Overview
Company Overview
Slide 10: Overview of Icahn Enterprises
Overview of Icahn Enterprises Icahn Enterprises L.P . is a diversified holding company with operating segments in Investment, Automotive, Energy, Gaming, Railcar, Food Packaging, Metals, Real Estate and Home Fashion IEP is a permanent capital vehicle that is majority owned and controlled by Carl Ica
Slide 11: Summary Corporate Organizational Chart
71% CVR Energy Inc. (NYSE: CVI) Summary Corporate Organizational Chart WestPoint Home LLC PSC Metals Inc. AREP Real Estate Holdings, LLC Tropicana Entertainment Inc. (OTCPK:TPCA) Federal - Mogul Corp. (NasdaqGS:FDML) Icahn Enterprises G.P. Inc. Icahn Enterprises L.P. (NasdaqGS: IEP) Icahn Enterprise
Slide 12: Deep Team Led by Carl Icahn
Deep Team Led by Carl Icahn Led by Carl Icahn ─ Substantial investing history provides IEP with unique network of relationships and access to Wall Street Team consists of nearly 20 professionals with diverse backgrounds ─ Well rounded team with professionals focusing on different areas such as equit
Slide 13: Investment Highlights
Investment Highlights
Slide 14: Investment Highlights
Investment Highlights Diversified Holdings Exposure to Strong, Cyclical Trends and Economic Recovery Significant Asset Coverage Strong, Stable Cash Flow Generation from Operating Subsidiaries 1 2 3 4 14
Slide 15: Diversified Holdings
Diversified Holdings 9/30/2013 Segment Results for IEP Continuing Operations LTM 9/30/2013 Segment Results for IEP Continuing Operations Automotive 18% Energy 26% Gaming 5% Railcar 6% Food Packaging 2% Metals 3% Real Estate 6% Home Fashion 2% Investment Management 32% Automotive 21% Energy 32% Gamin
Slide 16: Exposure to Strong, Cyclical Trends and Economic Recovery
Exposure to Strong, Cyclical Trends and Economic Recovery The Company’s diversification across multiple industries and geographies provides a natural hedge against cyclical and general economic swings IEP’s subsidiary companies possess strong market positions IEP seeks to create incremental value by
Slide 17: Highlights and Recent Developments: Investment
Highlights and Recent Developments Since inception in November 2004, the Investment Funds‘ return is 258%, representing an annualized rate of return of 15% through December 31, 2013 ─ For year - ended D ecember 31, 2013, returns of approximately 31.0% Long history of investing in public equity and d
Slide 18: Significant Holdings
Significant Holdings As of December 31, 2013 (3) As of December 31, 2012 (3) As of December 31, 2011 (3) Company Mkt. Value ($mm) (4) % Ownership (5) Company Mkt. Value ($mm) (4) % Ownership (5) Company Mkt. Value ($mm) (4) % Ownership (5) $2,654 0.5% $1,083 11.5% $1,920 9.4% $1,841 11.4% $992 9.0%
Slide 19: Highlights and Recent Developments: Energy
Highlights and Recent Developments CVR Refining IPO completed on January 23, 2013 and secondary offering on May 14, 2013 CVR Partners secondary offering completed May 22, 2013 Crude supply advantages supported by increasing North American crude oil production, decreasing North Sea production, transp
Slide 20: Segment: Automotive
Segment: Automotive Company Description Federal Mogul Corporation (NasdaqGS:FDML) operates in two business segments: Powertrain and Vehicle Component Systems ─ Powertrain focuses on original equipment powertrain products for automotive, heavy duty and industrial applications ─ Vehicle Component Syst
Slide 21: Highlights and Recent Developments: Railcar
Highlights and Recent Developments ARI reported record results ─ $761 million of LTM revenue and $ 177 million of LTM Adjusted EBITDA ─ Approximately 6,300 railcar backlog as of September 30, 2013 ─ $1.00 annualized dividend ARI manufacturing segment strong ─ Tank demand from increasing crude oil pr
Slide 22: Significant Asset Coverage
Significant Asset Coverage Significant Valuation demonstrated by market value of IEP’s public subsidiaries and Holding Company interest in Funds and book value or market comparables of other assets Note: Indicative net asset value does not purport to reflect a valuation of IEP. The calculated Indica
Slide 23: Hold Co Cash Flows
Hold Co Cash Flows 2013 Run Rate (1) CVI Dividend (2) $160 $214 CVRR Dividend (3) 16 18 ARII Dividend (4) 12 12 Triple Net Lease Real Estate Portfolio 42 42 American Railcar Leasing LLC (75% ownership) distributions – 75 Holdco Operating Expenses (20) (20) Subtotal 210 340 CVI Special Dividend (2) 8
Slide 24: Liquidity Serves as a Competitive Advantage
Liquidity Serves as a Competitive Advantage The Company and its subsidiaries maintain ample liquidity to take advantage of attractive opportunities for their respective businesses ($Millions) 24 4 As of 9/30/2013 Liquid Assets: Holding Company Cash & Cash Equivalents $958 Holding Company Investment
Slide 25: Financial Performance
Financial Performance
Slide 26: Financial Performance
Financial Performance Adjusted EBITDA Attributable to Icahn Enterprises GAAP Equity Attributable to Icahn Enterprises 26 $939 $1,547 $1,546 $1,945 FYE 2010 FYE 2011 FYE 2012 LTM 9/30/13 $3,183 $3,755 $4,669 $5,720 12/31/10 12/31/11 12/31/12 9/30/13 (1) In November 2010, IEP acquired a controlling in
Slide 27: Consolidated Financial Snapshot
Consolidated Financial Snapshot 27 2010 2011 2012 9/30/2012 9/30/2013 Revenues: Investment 887$ 1,896$ 398$ 304$ 1,706$ 1,800$ Automotive 6,239 6,937 6,677 5,083 5,177 6,771 Energy - - 5,519 3,651 6,735 8,603 Metals 725 1,096 1,103 872 737 968 Railcar 270 514 657 488 433 602 Gaming 78 624 611 488 44
Slide 28: Strong Balance Sheet
Strong Balance Sheet ($Millions) 28 Balance Sheet ($ millions) Investment Automotive Energy Metals Railcar Gaming Food Packaging Real Estate Home Fashion Holding Company Consolidated Assets Cash and Cash Equivalents $ 5 $ 960 $ 887 $ 31 $ 115 $ 245 $ 14 $ 43 $ 16 $ 958 $ 3,274 Cash held at consolida
Slide 29: Appendix
Appendix 29
Slide 30: Evolution of Icahn Enterprises
IEP began as American Real Estate Partners, which was founded in 1987, and has grown its diversified portfolio to nine operating segments and over $31 billion of assets as of September 30, 2013 IEP has demonstrated a history of successfully acquiring undervalued assets and improving and enhancing th
Slide 31: Highlights and Recent Developments: Gaming
Highlights and Recent Developments Management uses a highly analytical approach to enhance marketing, improve utilization, optimize product mix and reduce expenses ─ Established measurable, property specific, customer service goals and objectives to meet customer needs ─ Utilize sophisticated custom
Slide 32: Highlights and Recent Developments: Food Packaging
Highlights and Recent Developments Future growth expected to be driven by changing diets of a growing middle class in emerging markets ─ Since 2007, sales to emerging economies have grown, on average, 13% per year ─ Emerging market sales are over 50% of global sales in 2013 compared to 36% in 2007 ─
Slide 33: Highlights and Recent Developments: Metals
Highlights and Recent Developments NAFTA steel demand growth is estimated to be 0.2 % for 2013, with growth forecasted to be 3.2 % in 2014 (1) Increasing global demand for steel and other metals drives demand for U.S. scrap exports ─ Global steel use increasing 3.1% in 2013 and 3.3% in 2014 (1) PSC
Slide 34: Highlights and Recent Developments: Real Estate
Highlights and Recent Developments Business strategy is based on long - term investment outlook and operational expertise Rental Real Estate Operations Net lease portfolio overview ─ Single tenant (over $100 billion market cap, A - credit) for two large buildings with leases through 2020 – 2021 ─ 27
Slide 35: Highlights and Recent Developments: Home Fashion
Highlights and Recent Developments One of the largest providers of home textile goods in the United States Largely completed restructuring of manufacturing footprint ─ Transitioned majority of manufacturing to low cost plants overseas Streamlined merchandising, sales and customer service divisions F
Slide 36: EBITDA Reconciliation
EBITDA Reconciliation 36
Slide 37: EBITDA and Adjusted EBITDA Reconciliation
EBITDA and Adjusted EBITDA Reconciliation 37 Year Ended December 31, Nine Months Ended September 30, Twelve Months Ended September 30, 2010 2011 2012 2012 2013 2013 (unaudited) (unaudited) (unaudited) Attributable to Icahn Enterprises: Net income $199 $750 $396 $390 $803 $809 Interest expense, net 3
Slide 38: EBITDA and Adjusted EBITDA Reconciliation by Segment – FYE 2012
EBITDA and Adjusted EBITDA Reconciliation by Segment – FYE 2012 38 Investment Automotive Energy Metals Railcar Gaming Food Packaging Real Estate Home Fashion Holding Company Total (unaudited) Attributable to Icahn Enterprises: Net income (loss) $157 ($24) $263 ($58) $29 $21 $4 $19 ($27) $12 $396 Int
Slide 39: EBITDA and Adjusted EBITDA Reconciliation by Segment – FYE 2011
EBITDA and Adjusted EBITDA Reconciliation by Segment – FYE 2011 39 Investment Automotive Energy Metals Railcar Gaming Food Packaging Real Estate Home Fashion Holding Company Total (unaudited) Attributable to Icahn Enterprises: Net income $868 $121 $ -- $6 $2 $13 $4 $18 ($56) ($226) $750 Interest exp
Slide 40: EBITDA and Adjusted EBITDA Reconciliation by Segment – FYE 2010
EBITDA and Adjusted EBITDA Reconciliation by Segment – FYE 2010 40 Investment Automotive Energy Metals Railcar Gaming Food Packaging Real Estate Home Fashion Holding Company Total (unaudited) Attributable to Icahn Enterprises: Net income $340 $116 $ -- $4 ($15) $ -- $10 $8 ($42) ($222) $199 Interest
Slide 41: EBITDA and Adjusted EBITDA Reconciliation by Segment – YTD Q3 2013
EBITDA and Adjusted EBITDA Reconciliation by Segment – YTD Q3 2013 41 Investment Automotive Energy Metals Railcar Gaming Food Packaging Real Estate Home Fashion Holding Company Total (unaudited) Attributable to Icahn Enterprises: Net income (loss) $690 $31 $340 ($18) $15 $18 ($7) $12 ($5) ($273) $80
Slide 42: EBITDA and Adjusted EBITDA Reconciliation by Segment – YTD Q3 2012
EBITDA and Adjusted EBITDA Reconciliation by Segment – YTD Q3 2012 42 Investment Automotive Energy Metals Railcar Gaming Food Packaging Real Estate Home Fashion Holding Company Total (unaudited) Attributable to Icahn Enterprises: Net income (loss) $121 $38 $219 ($21) $20 $25 $3 $17 ($16) ($16) $390
Slide 43: EBITDA and Adjusted EBITDA Reconciliation by Segment – LTM Q3 2013
EBITDA and Adjusted EBITDA Reconciliation by Segment – LTM Q3 2013 43 Investment Automotive Energy Metals Railcar Gaming Food Packaging Real Estate Home Fashion Holding Company Total (unaudited) Attributable to Icahn Enterprises: Net income (loss) $726 ($31) $384 ($55) $24 $14 ($6) $14 ($16) ($245)
Slide 44: Adjusted EBITDA Reconciliation – American Railcar Industries, Inc. (ARII)
Adjusted EBITDA Reconciliation – American Railcar Industries, Inc. (ARII) 44 Source: ARI Q3 2013 & Q4 2012 Earnings Press Release. Financials FYE FYE 2011 2012 Net Earnings 4$ 64$ 88$ Income Tax expense 4 42 56 Interest expense 20 18 9 Loss in debt extinguishment 0 2 0 Interest Income (4)$ (3)$ (3)$
Slide 45: Adjusted EBITDA Reconciliation – CVR Energy (CVI)
Adjusted EBITDA Reconciliation – CVR Energy (CVI) 45 Source: CVR Energy Q3 2013 Earnings Presentation. Financials FYE FYE LTM Q3 ($ in millions) 2011 2012 2013 Net income (loss) attributable to CVR Energy stockholders 346$ 379$ 433$ Interest expense and other financing costs, net of interest income
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