Slide 1: FY 2016 First Quarter Earnings Conference Call
FY 2016 FIRST QUARTER EARNINGS CONFERENCE CALL February 9, 2016
Slide 2: Agenda
Agenda TransDigm Overview W. Nicholas Howley Chairman, President and CEO Highlights, Market Review, Operating W. Nicholas Howley Performance and Outlook Chairman, President 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: 2016 Q1 Financial Performance by Markets – Pro Forma
2016 Q1 Financial Performance by Markets – Pro Forma Highlights⁽¹⁾ Q1 Market Review – Pro Forma Revenues⁽¹⁾ Actual vs. Prior Year Q1 Commercial OEM Commercial OEM: Up 1% Commercial transport revenue up 5% Commercial Aftermarket Commercial Aftermarket: Flat Commercial transport revenue up 2% Defe
Slide 7: Fiscal 2016 Outlook
Fiscal 2016 Outlook FY 2015 Pro Forma Sales Mix (1) Market FY 2016 Expected Growth 32% Commercial OEM Up Mid Single-Digit % 39% Commercial Aftermarket Up Mid to High Single-Digit % 29% Defense Up Low Single-Digit % Assumptions Guidance Summary ($ in millions) Worldwide RPM growth ≈ 5% Low High F
Slide 8: First Quarter 2016 Results
First Quarter 2016 Results ($ in millions, except Q1 FY16 per share amounts) Thirteeen Week Periods Ended January 2, 2016 December 27, 2014 Revenue $701.7 $586.9 19.6% Increase Gross Profit $374.6 $321.2 1.3 Margin Point Decrease Margin % 53.4% 54.7% ● Dilutive impact from acquisitions ● Strength of
Slide 9: Liquidity & Taxes
Liquidity & Taxes ($ in millions) Cash Liquidity Q1 FY 2016 Net Debt to Pro 1/2/2016 FY 9/30/2015 Actual Forma EBITDA As Net Cash Provided by 1/2/2016 Defined Multiple Rate Operating Activities $164.1 $520.9 Cash $805 Capital Expenditures ($10.2) ($54.9) $550m revolver – L + 3.00% Free Cash Flow $15
Slide 10: Reconciliation of GAAP to Adjusted EPS - Guidance
Reconciliation of GAAP to Adjusted EPS - Guidance Full Year Guidance Thirteen Week Periods Ended Mid-Point January 2, December 27, September 30, 2016 2014 2016 Earnings per share $ 1.97 $ 1.63 $ 9.60 Adjustments to earnings per share: Dividend equivalent payment 0.05 0.06 0.05 Non-cash stock compens
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 Periods Ended January 2, December 27, 2016 2014 Net income $ 114,901 $ 95,533 Adjustments: Depreciation and amortization expense 26,201 21,785 Interest expense - net 111,983 98,935 Income tax provi
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 Periods Ended January 2, December 27, Reported Earnings Per Share 2016 2014 Net income $ 114,901 $ 95,533 Less: dividends on participating securities (3,000) (3,365) Net income applicab
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) Thirteen Week Periods Ended January 2, 2016 December 27, 2014 Net cash provided by operating activities $ 164,130 $ 188,959 Adjustments: Changes in assets and liabilities, net of e