Slide 1: FY 2023 Fourth Quarter Earnings Call
FY 2023 Fourth Quarter Earnings Call November 8, 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 Fourth Quarter Earnings Call Adient – PUBLIC November 8, 2023 3
Slide 4: Finishing the year strong; delivering on our commitments
Finishing the year strong; delivering on our commitments > Adient finished the year strong despite labor-related production disruptions at certain of the company’s customers in North America > Although the production disruptions occurred in the final days of FY23, the company acted quickly to implem
Slide 5: Managing the here and now -- UAW strike impact
Managing the here and now -- UAW strike impact Near term financial impact to Adient Actions taken to mitigate the impact > Cash conservation mode 1 FY23 FY24 > Strong year-end cash / liquidity Sales ~$30M ~$125M > Reduced / eliminated non-discretionary spending Adj.-EBITDA <$5M ~$25M > Short term la
Slide 6: Adient's focused strategy leverages a firm foundation to navigate external challenges
Adient’s focused strategy leverages a firm foundation to navigate through external challenges while driving the business forward Tenets of Adient's focused strategy: > In FY24 and beyond, Adient will adapt to an evolving auto industry (balance and timing of EV transition) Leading supplier focused >
Slide 7: Favorable trends suggest seating content growth will continue
Favorable trends suggest seating content growth will continue Favorable trends in China today that are > Historically, Adient sales have outpaced global expected to cascade into other regions vehicle production growth by about ~150 bps 1 > China is bringing a concept to the market of what a > Key fa
Slide 8: In process and upcoming launches
In process and upcoming launches: Adient continues to successfully launch new and replacement business at a very high level > Continued focus on process discipline remains the foundation driving the business forward -- delivering excellent results for customers and cementing Adient’s supplier of Toy
Slide 9: Strengthening our leading position and solidifying supplier of choice status
Strengthening our leading position and solidifying supplier of choice status > Adient continues to win new and replacement business across geographies and powertrains -- both ICE and EV > EV wins particularly strong in China with new entrants; Adient business wins aligned with market trend of Chines
Slide 10: Looking forward…
Looking forward… > The accomplishments achieved in FY23, which include but are not limited to, significant program wins, high quality launches, actions to further reduce costs, and progress towards executing the company’s enhanced capital allocation plan enables Adient to enter FY24 from a position
Slide 11: Financial Review
Financial Review FY2023 Fourth Quarter Adient – PUBLIC
Slide 12: Q4 FY2023 Key Financials
Q4 FY2023 Key Financials As Reported As Adjusted 1 $ millions, except per share data Q4 FY23 Q4 FY22 Q4 FY23 Q4 FY22 B/(W) Consolidated $ 3,729 $ 3,650 $ 3,729 $ 3,650 2% Revenue EBIT $ 140 $ 138 $ 150 $ 144 4% Margin 3.8% 3.8% 4.0% 3.9% EBITDA N/A N/A $ 235 $ 227 4% Margin 6.3% 6.2% Memo: Equity In
Slide 13: FY2023 Full Year Key Financials
FY2023 Full Year Key Financials As Reported As Adjusted 1 $ millions, except per share data FY23 FY22 FY23 FY22 B/(W) Consolidated $ 15,395 $ 14,121 $ 15,395 $ 14,121 9% Revenue EBIT $ 523 $ 259 $ 614 $ 348 76% Margin 3.4% 1.8% 4.0% 2.5% EBITDA N/A N/A $ 938 $ 675 39% Margin 6.1% 4.8% Memo: Equity I
Slide 14: Q4 FY2023 Revenue: Consolidated and Unconsolidated Sales
Q4 FY2023 Revenue: Consolidated and Unconsolidated Sales Regional Performance Consolidated sales (consolidated sales y-o-y growth (vs. Q4FY22 and FY22) by region) 1, 2 $30 Q4 FY2023 $49 Q4 S&P FY2023 S&P Production Production Americas 3% 9% 10% 10% $3,729 EMEA - 3% 11% 15% $3,650 Asia -3% 2% 13% 6%
Slide 15: Q4 FY23 Adjusted-EBITDA
Q4 FY23 Adjusted-EBITDA $7 $5 $9 Q4FY23 adjusted EBITDA of $235M, up $8M y-o-y, was $ in millions $(1) $(12) primarily driven by: $227 $235 > Improved business performance of $9M, as improved net material margin and lower input costs (i.e., freight) Q4FY22 Business Volume / Equity Income Commodities
Slide 16: Cash flow
Cash flow Free Cash Flow Key drivers impacting FY23 FCF: (in $ millions) Q4 FY23 YTD Q4 FY22 YTD (+) Higher consolidated y-o-y earnings (driven Adjusted-EBITDA (Excl. Equity income) $ 211 $ 848 $ 206 $ 587 by improved volumes and incrementally Dividends received from partially owned non- improving p
Slide 17: Debt and capital structure
Debt and capital structure Net Debt ($ in millions) 9/30/2023 September 30 September 30 Cash & Debt Profile Amount (in $ millions) 2023 2022 Cash & Cash Equivalents $ 1,110 Cash $ 1,110 $ 947 ABL Revolver, incl. FILO due 2027 1 - Term Loan B due 2028 635 Total Debt 2,535 2,578 7.000% Secured Notes d
Slide 18: Financial Outlook FY 2024
Financial Outlook FY 2024 Adient – PUBLIC
Slide 19: Key assumptions
Key assumptions Key production assumptions (October S&P Global estimates) FY24 Sales Sales and volume projections are generally (units in millions) FY24 Plan FY23 S&P y-o-y ∆ Sales / Volume underpinned by October S&P estimates actual y-o-y % (FX adj.) N. America 15.6 15.5 1% 1% Adjusted EBITDA is ex
Slide 20: Expected influences on Adient's key financial metrics in FY24
Expected influences on Adient’s key financial metrics in FY24 Excluding impact of UAW strike REVENUE (pre-strike): $15.6B - > Increased volume & mix expected to drive Adient sales up by ~2% in FY24 vs. last year – generally in- $15.7B line with October S&P forecast > Significant growth over market e
Slide 21: FY24 Outlook – key financial metrics
FY24 Outlook – key financial metrics Unimpacted ~$15.6B-$15.7B * > Known strike impact to revenue and Adj.-EBITDA through Consolidated sales $125M known strike impact through 11/3 November 3, 2023 of ~$125M and ~$25M, respectively. Adient to Unimpacted ~$1,010M * provide updates as FY24 progresses w
Slide 22: Appendix and financial reconciliations
Appendix and financial reconciliations FY 2023 Fourth Quarter Adient – PUBLIC
Slide 23: Q4 FY23 Adjusted-EBITDA: Americas
Q4 FY23 Adjusted-EBITDA: Americas Q4FY23 of $100M, down $17M y-o-y, driven by: $ in millions > Improved volume and mix of $12M resulting $12 from continued improving customer production $117 was a partial offset to the headwinds (despite the impact of work stoppages at certain $100 $(12) customers l
Slide 24: Q4 FY23 Adjusted-EBITDA: EMEA
Q4 FY23 Adjusted-EBITDA: EMEA Q4FY23 of $48M, up $14M y-o-y, driven by: $ in millions > Improved business performance of $13M, driven by: $10 > Improved net material margin and lower input costs (i.e., freight) $13 $48 $(4) > Partially offsetting these $(3) $(2) improvements within business performa
Slide 25: Q4 FY23 Adjusted-EBITDA: Asia
Q4 FY23 Adjusted-EBITDA: Asia $ in millions Q4FY23 of $113M, up $13M y-o-y, driven by: > Higher equity income of $8M as the prior period reflected a large retroactive restructured pricing change between the $3 $7 Keiper joint venture partners $8 $113 $100 $(4) $(1) > Business performance was improve
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 2023 2022 2023 2022 (in $ millions) GAAP Adj. Adjusted GAAP Adj. Adjusted GAAP Adj. Adjusted GAAP Adj. Adjusted Net sales $ 3,729 $ - $ 3,729 $ 3,650 $ - $
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 Three Months Ended September 30 September 30 (in $ millions) 2023 2022 2023 2022 Net income (loss) attributable to Adient $ 135 $ 45 Diluted earnings (loss) per share as report
Slide 29: Non-GAAP Reconciliations - Adjusted Net Income and Adjusted EPS
Non-GAAP Reconciliations - Adjusted Net Income and Adjusted EPS Adjusted Net Income Adjusted Diluted EPS Twelve Months Ended Twelve Months Ended September 30 September 30 (in $ millions) 2023 2022 2023 2022 Net income (loss) attributable to Adient $ 205 $ (120) Diluted earnings (loss) per share as r
Slide 30: 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 September 30 Twelve Months Ended September 30 (in $ millions) 2023 2022 2023 2022 Income (loss) Income (loss) before I
Slide 31: Non-GAAP Reconciliations - Consolidated and Unconsolidated sales fiscal year 2022 and net leverage
Non-GAAP Reconciliations - Consolidated and Unconsolidated sales fiscal year 2022 and net leverage Unconsolidated Sales (FX adjusted) Consolidated Sales (FX adjusted) (in $ millions) (in $ millions) Unconsolidated Net Sales Q1 Q2 Q3 Q4 FY2022 Consolidated Net Sales Q1 Q2 Q3 Q4 FY2022 As reported $ 1
Slide 32: Segment Performance
Segment Performance Q1 2022 Q1 2023 Corporate/ Corporate/ Americas EMEA Asia Consolidated Americas EMEA Asia 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 -