Slide 1: FY 2023 Third Quarter Earnings Call
FY 2023 Third Quarter Earnings Call August 2, 2023 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” within
Slide 3: Agenda
Agenda > Introduction Mark Oswald VP, Treasurer & Investor Relations > Business Update Doug Del Grosso President and CEO > Financial Review Jerome Dorlack Executive VP and CFO > Q&A FY2023 Third Quarter Earnings Call Adient – PUBLIC August 2, 2023 3
Slide 4: Strong Q3 performance continues to drive the business forward
Strong Q3 performance continues to drive the business forward Remaining focused on delivering the company’s commitments > Adient delivered strong and improved y-o-y earnings growth in Q3FY23 – underpinned by a relentless focus on execution, operational excellence and better than expected production
Slide 5: China -- a key market for Adient today and in the future
China -- a key market for Adient today and in the future > A key ingredient to Adient’s current and expected future success includes the company’s China operations > During the quarter, Adient met with several investors in Shanghai to provide an update on the China business > Despite geopolitical te
Slide 6: In process and upcoming launches
In process and upcoming launches: Adient continues to successfully launch new and replacement business at a very high level Chevy Blazer This launch represents Adient’s first GM JIT program in Mexico in over 15 Americas years, with Adient providing foam and trim in addition to JIT assembly on GM’s a
Slide 7: Strengthening our leading position and solidifying supplier of choice status
Strengthening our leading position and solidifying supplier of choice status > Strong operational execution continues to be the foundation for new business wins -- Adient’s focused strategy and disciplined launch performance are being recognized by customers > Focus on securing replacement business
Slide 8: Focused strategy driving the business forward in 2023 and beyond
Focused strategy driving the business forward in 2023 and beyond > Adient’s focused strategy continues to drive the business forward – fiscal 2023 Q3 and YTD results provide a positive proof point Leading supplier focused on Driving operational and automotive seating financial improvements > Adient
Slide 9: Financial Review
Financial Review FY2023 Third Quarter Adient – PUBLIC
Slide 10: Q3 FY2023 Key Financials
Q3 FY2023 Key Financials As Reported As Adjusted $ millions, except per share data Q3 FY23 Q3 FY22 Q3 FY23 Q3 FY22 B/(W) Consolidated $ 4,055 $ 3,485 $ 4,055 $ 3,485 16% Revenue EBIT $ 173 $ 35 $ 195 $ 64 NM Margin 4.3% 1.0% 4.8% 1.8% EBITDA N/A N/A $ 276 $ 143 93% Margin 6.8% 4.1% Memo: Equity Inco
Slide 11: Q3 FY2023 Revenue: Consolidated and Unconsolidated Sales
Q3 FY2023 Revenue: Consolidated and Unconsolidated Sales Regional Performance Consolidated sales (consolidated sales y-o-y growth (vs. Q3FY22) by region) 1, 2 $596 Q3 S&P Q3 Production $(26) Americas 13.7% 14.9% $4,055 EMEA 16.8% 13.4% Asia 24.8% 17.3% Note: China 31.0% 20.4% $3,485 Note: Asia excl.
Slide 12: Q3 FY23 Adjusted-EBITDA
Q3 FY23 Adjusted-EBITDA $11 Q3FY23 adjusted EBITDA of $276M, up $133M y-o-y, was $82 primarily driven by: $96 $(55) $(1) $ in millions > Volume and mix, which benefited the quarter by $276 ~$96M as production improved $143 > Improved business performance of ~$82M, driven Q3FY22 Volume / Business Equ
Slide 13: Cash flow
Cash flow Free Cash Flow Key drivers impacting FY23 FCF YTD: (+) Higher consolidated y-o-y earnings (driven (in $ millions) Q3 FY23 YTD FY23 Q3 FY22 YTD FY22 by improved volumes and incrementally Adjusted-EBITDA (Excl. Equity income) $ 249 $ 637 $ 127 $ 381 improving production environment) Dividend
Slide 14: Debt and capital structure
Debt and capital structure ($ in millions) 6/30/2023 Net Debt Cash & Debt Profile Amount June 30 September 30 Cash & Cash Equivalents $ 908 (in $ millions) 2023 2022 ABL Revolver, incl. FILO due 2027 1 - Cash $ 908 $ 947 Term Loan B due 2028 635 7.000% Secured Notes due 2028 500 Total Debt 2,534 2,5
Slide 15: FY23 Outlook – key financial metrics
FY23 Outlook – key financial metrics > FY23 guidance updated to reflect Adient’s YTD results through Consolidated sales ~$15.4B Prior $15.0B June 30, 2023 and current market conditions (including revised production forecast and current FX rates) Adj.-EBITDA ~$920M > Consolidated sales of ~$15.4B (up
Slide 16: Appendix and financial reconciliations
Appendix and financial reconciliations FY 2023 Third Quarter Adient – PUBLIC
Slide 17: Q3 FY23 Adjusted-EBITDA: Americas
Q3 FY23 Adjusted-EBITDA: Americas Q3FY23 of $95M, up $25M y-o-y, driven by: > Improved volume and mix of ~$32M resulting from continued improving customer production $3 $1 $ in millions > Improved business performance of ~$3M $32 $95 driven by: > Improved net material margin, lower $(6) $(5) input c
Slide 18: Q3 FY23 Adjusted-EBITDA: EMEA
Q3 FY23 Adjusted-EBITDA: EMEA Q3FY23 of $103M, up $72M y-o-y, driven by: $ in millions > Improved business performance of ~$78M, driven by: $9 > Improved net material margin, lower $31 input costs (i.e., freight), labor and overhead efficiencies, and the impact of a nonrecurring insurance recovery $
Slide 19: Q3 FY23 Adjusted-EBITDA: Asia
Q3 FY23 Adjusted-EBITDA: Asia Q3FY23 of $100M, up $36M y-o-y, driven by: $ in millions > Favorable volume and mix impact of ~$33M, driven primarily by improved production volumes > Equity income was higher by ~$10M as volumes at unconsolidated JVs recovered > FX was an approximately ~$4M headwind $1
Slide 20: 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 21: 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 June 30 2023 2022 (in $ millions) GAAP Adj. Adjusted GAAP Adj. Adjusted Net sales $ 4,055 $ - $ 4,055 $ 3,485 $ - $ 3,485 Cost of sales (1) 3,753 (1) 3,752 3,312 (2) 3,310 Gross profit 302 1 303 173 2
Slide 22: 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 Three Months Ended June 30 June 30 (in $ millions) 2023 2022 2023 2022 Net income (loss) attributable to Adient $ 73 $ (30) Diluted earnings (loss) per share as reported $ 0.77
Slide 23: 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 EBITDA excluding Equity Income Adjusted Income before Income Taxes Three Months Ended June 30 (in $ millions) 2023 2022 Income (loss) Income (loss) before Income Tax impact Effective before Income Tax imp
Slide 24: Non-GAAP Reconciliations - Unconsolidated sales and net leverage
Non-GAAP Reconciliations - Unconsolidated sales fiscal year 2022 and net leverage Unconsolidated Sales (FX adjusted) (in $ millions) Unconsolidated Net Sales Q1 Q2 Q3 Q4 FY2022 As reported $ 1,208 $ 916 $ 869 $ 1,046 $ 4,039 FX Impact (138) (56) (42) FX Adjusted 1,070 860 827 Net Leverage (in $ mill
Slide 25: Segment Performance
Segment Performance Q1 2022 Q1 2023 Corporate/ Corporate/ Americas EMEA AP Consolidated Americas EMEA AP Consolidated Eliminations Eliminations Net Sales 1,498 1,230 784 (32) 3,480 1,724 1,182 821 (28) 3,699 Adjusted EBITDA 9 43 114 (20) 146 69 28 138 (23) 212 Adjusted Equity Income (1) (1) 36 - 34