Westinghouse Air Brake Technologies Corporation · NYSE:WAB
Westinghouse Air Brake Technologies — Q4 2019 Earnings Presentation
22 slides from Westinghouse Air Brake Technologies's earnings presentation, Feb 18, 2020
Slide 1: Wabtec 4th Quarter 2019 Financial Results & Company Highlights
Wabtec 4th Quarter 2019 Financial Results & Company Highlights February 18, 2020 Exhibit 99.2
Slide 2: Forward-looking statements
This communication contains “forward-looking” statements as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995, including statements regarding the ac
Slide 3: Executive summary
Executive summary Delivered strong financial results for 2019 despite North American freight market headwinds FY19 GAAP cash from operations of $1.0B FY GAAP EPS of $1.84; adjusted EPS of $4.17 4Q GAAP and adjusted sales of $2.4B GAAP income from ops of $0.2B and adjusted income from ops of $0.3B En
Slide 4: Segment Dynamics
Segment Dynamics North America carload volume down (7%) in 4Q’19 and (4%) for the FY19 … expect 2020 to be flat to slightly down North America railcar deliveries at ~58K in 2019 … expected to be ~40K in 2020 Freight services, international and digital growth offsetting North America freight market s
Slide 5: 4Q 2019 performance
4Q 2019 performance Sales EBITDA Income from ops Profit margin EPS Cash from ops Backlog Reported $2,368M $337M $226M 9.5% $0.71 $448M $22.4B Adjusted y/y 113% 122% 0.6 pts Freight Sales Income from ops Profit margin % Backlog Transit Sales Income from ops Profit margin % Backlog Adjusted(1) $1,675M
Slide 6: Liquidity & leverage
Liquidity & leverage Strong cash flow generation to de-lever the balance sheet … long-term target leverage ~2-2.5X GAAP cash from ops FY19 $1.0B FY20 Guidance ~$0.9B 4Q’19 ~2.6X Long-term target ~2.0-2.5X Net debt / Adj. EBITDA(1) Wabtec uses a leverage ratio of Net Debt to Adj. EBITDA for purposes
Slide 7: 2019 pro-forma results
2019 pro-forma results(1) Revenue $8.2 $8.3 $(0.1) $0.5 - $8.7 $8.7 Income from Operations $0.7 $1.2 $(0.1) $(0.1) $0.3 $1.3 $1.4 EBITDA $1.1 $1.6 $(0.1) $(0.0) - $1.5 $1.6 Cash from Operations $1.0 $1.1 - $(0.3) - $0.8 $0.9 EPS (177M shares) $1.84 $4.17 ($0.39) $(0.37) $1.19 $4.60 N/A EPS (192M sha
Slide 8: 2020 guidance
2020 guidance Sales GAAP: ~$8.7B EPS GAAP: $3.20 to $3.50 Adjusted: $4.50 to $4.80 Cash from operations GAAP: ~$900M EBITDA ~$1.6B SG&A ~$1.1B Depreciation ~$180M Amortization ~$280M Interest ~$50M per quarter Tax rate at ~25.5% Capex of ~$200M Shares outstanding ~192M Adjusted EPS guidance excludes
Slide 9: Focused strategy, positioned for long-term growth
Focused strategy, positioned for long-term growth Solid 4th quarter performance … well positioned to deliver on 2020 financial guidance Significant installed base across Freight and Transit … resilient business model Cost reductions on track … making great progress to meet synergy target of $250M be
Slide 10: Wabtec 2020 Investor Conference
: WABTEC = 2020 INVESTOR CONFERENCE
Slide 11: Questions?
Questions?
Slide 12: Appendix
Appendix
Slide 13: Income statement
Income statement Appendix A ( 1 of 2)
Slide 14: Income statement (cont.)
Income statement (cont.) Appendix A ( 2 of 2)
Slide 15: Balance sheet
Balance sheet In millions Cash and cash equivalents Restricted cash Property, plant and equipment, net Goodwill Other intangibles, net Other long term assets Total assets Current liabilities, Total Liabilities and Shareholders’ Equity ANCE SHEETS (UNAUDITED) December 31, 2019 $ 604.2 Appendix B Dece
Slide 16: Cash flow
Appendix C Cash flow CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) ‘Twelve Months Ended December 31, 2019 2018 Jn mittions Net cash provided by operating activities $ 10155 314.7 Net cash used for investing activities @.177.8) (147.3) Net cash provided by financing activities 461.5 1,9
Slide 17: EPS and non-GAAP Reconciliation
EPS and non-GAAP Reconciliation Appendix D
Slide 18: EBITDA reconciliation
EBITDA reconciliation Appendix E
Slide 19: Freight and Transit segment product lines
Freight segment Transit segment Product Lines Equipment Components Transit Services Digital & Electronics
Slide 20: Net sales by product line
NET SALES BY PRODUCT LINE [in mitlions 2019 Fi jecond Third Fourth Quarter Quarter Quarter Quarter Freight Segment quipm 267.1 $ 531.3 263.3 638.0 $ 1,699.7 con (295.2 279.5 248.7 250.1 1,073.5 bata ectronics 121.8 159. 185.5 210.8 7.1 Seni 231.4 556.5 635.0 2 Total right Segment 915.5 1,526.3 1,332
Slide 21: Segment financial information: Freight
‘SEGMENT FINANCIAL INFORMATION tea in chang as a result, t i period segment information. [immittions 2019 - Freight Segment Fi Second it Fourth Quarter Quarter Quarter Quarter Full Year Net sales 955 $ 15263 $ 13325 $ 16671 $ 54414 Cost of sales (700.5) (1,101.4) (905.2) (1,152.9) 860.0) Gross profi
Slide 22: Segment financial information: Transit
‘SEGMENT FINANCIAL INFORMATION Appenelix H as aresult, Freight to 0f 2019. The chi he r eg information. [minions 2019 - Transit Segment First ‘Second Third Four uarter Quarter Quarter Quarter Full Year t sales $1 $ m00 $ 2 $ 713 $ 2,758.6 Cost of sales (604.1) (520.2) (497.1) (540.6) (2,062.0 Gross
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