Materion Corporation · NYSE:MTRN
Materion — Brush Engineered Materials — Shareholder Meeting (May 2010)
33 slides from Materion's shareholder meeting presentation, May 5, 2010
Slide 1: Forward-looking Statements
Forward-looking Statements These slides contain (and the accompanying oral discussion contains) "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that could cause
Slide 2: Annual Meeting of Shareholders May 5, 2010
Brush Engineered Materials Inc. Annual Meeting of Shareholders May 5, 2010
Slide 3: 2009: In Summary
2 2009: In Summary Financial results significantly impacted by the economic crisis Sales revenues down 21% Earnings dropped to $(0.61) per share from $0.89 in 2008 Yet, we maintained strong cash flow and balance sheet
Slide 4: Brush Engineered Materials transformed
3 Brush Engineered Materials transformed A leaner, more resilient business model More balanced Lower capital costs Growth and margin contributions from acquisitions Broadened market reach
Slide 5: Validating our Strategy: faster return to profitability
4 Validating our Strategy Our return to profitability much faster compared to 2000/2002 downturn
Slide 6: Validating our Strategy: less traditional markets gaining share
5 Validating our Strategy Less traditional markets gaining stronger share
Slide 7: Smart and Accretive Acquisitions
6 Smart and Accretive Acquisitions Barr Associates Westford, Massachusetts Academy Corporation Albuquerque, New Mexico
Slide 8: Building a broader technology base in thin film coatings and optical filters
7 Building a broader technology base in precision thin film coatings and optical filters
Slide 9: Academy acquisition expands our precious metals capabilities
8 Academy acquisition expands our precious metals capabilities
Slide 10: Capitalizing on opportunities from acquisitions
9 Capitalizing on opportunities from acquisitions Strengthened technology bench Established platform for growth Created powerful distinctive competencies Synergies differentiate Brush
Slide 11: Building for the future: primary beryllium facility
10 Building for the future $90.3 million primary beryllium facility
Slide 12: Strong performance to date in 2010
11 Strong performance to date in 2010 Demand greater than anticipated Telecom infrastructure Consumer electronics Data storage Automotive Optics Oil & gas Aerospace
Slide 13: Transforming Our World and Yours
12 Transforming Our World and Yours
Slide 14: As 2009 began, we were facing unprecedented challenges
13 As 2009 began, we were facing unprecedented challenges New priorities ... Reduce cost significantly Maintain the quality of our balance sheet While pressing ahead with key growth initiatives
Slide 15: As 2009 began ... we were a much stronger company
14 As 2009 began ... we were a much stronger company Growth (Sales in millions) Balance Sheet Quality (Total debt in millions) - - New product introduction - - International expansion - - Manufacturing excellence - - Acquisitions
Slide 16: We were in a much better position to respond
15 We were in a much better position to respond Scale larger Markets more diverse Growth opportunities greater Balance sheet stronger
Slide 17: On the cost front: Initially
16 On the cost front Initially ... Diligently reduce working capital Reduce capital spending Seek supplier concessions Reduced headcount Implemented pay freezes Reduced work hours Suspended a portion of the 401(k) match Limited discretionary spending Deferred lower priority initiatives
Slide 18: On the cost front: Later
17 On the cost front Later ... Cumulative employment reduction to 17% Senior executive salary reductions of 10% Director cash retainer reduced 10% Senior manager salary reductions of 7% Suspended the balance of the 401(k) match
Slide 19: Overall these actions did
18 Overall these actions did Ensure a healthy balance sheet Lead to a leaner, more efficient operating structure Not disrupt investment in critical growth programs
Slide 20: Our balance sheet quality and financial flexibility are significant strengths
19 Our balance sheet quality and financial flexibility are significant strengths Total Debt (in millions) Debt-to-Debt-Plus-Equity Barr acquisition $55.4 million, debt increased only $22 million
Slide 21: 2009 ended and 2010 began in a markedly different environment
20 2009 ended and 2010 began in a markedly different environment Expect to be solidly profitable End market demand improving Consumer markets improved first Industrial markets improved later
Slide 22: Now beginning to see leverage from the 2009 actions
21 Now beginning to see leverage from the 2009 actions Prior year cost reductions Solid balance sheet Acquisitions in place Strong growth Margins improving
Slide 23: Stronger than expected first quarter results: sales
22 The company reported stronger than expected first quarter results Sales a record at $295.1 million An increase of $159.7 million Demand contributed $80.0 million or 60% Acquisitions added $60.0 million Metal prices added $19.0 million
Slide 24: Stronger than expected first quarter results: net income
23 The company reported stronger than expected first quarter results Net income was $.33 per share Results included $.12 per share of charges, $.07 due to the health care bill Margins expanded
Slide 25: The company raised its outlook for the year
24 The company raised its outlook for the year due to Continuing improvement in order entry A growing backlog Improving margins Expect 2010 earnings to be $1.45 - $1.75 per share
Slide 26: Transforming Our World and Yours
25 Transforming Our World and Yours
Slide 27: In good position for the future: interconnect solutions
26 In good position for the future Our materials meet mission-critical needs Interconnect solutions from Engineered Material Systems
Slide 28: In good position for the future: directional drilling materials
27 In good position for the future Directional drilling materials from Specialty Engineered Alloys
Slide 29: In good position for the future: beryllium beam pipes and speaker diaphragms
28 In good position for the future Beryllium beam pipes and speaker diaphragms from the Beryllium and Beryllium Composites Segment
Slide 30: In good position for the future: LED and solar
29 In good position for the future Advanced Material Technologies and Services segment supports LED's and solar
Slide 31: We have what it takes
30 We have what it takes A clear and deliberate strategy Unrivaled high performance materials Exciting long-term market prospects A motivated, talented employee team
Slide 32: Brush Engineered Materials: from metals and mining to advanced materials
31 Brush Engineered Materials From metals and mining Through specialty metals, and On to advanced materials
Slide 33: Transforming Our World and Yours
32 Transforming Our World and Yours
Brush Engineered Materials — Shareholder Meeting (May 2010) on 6ix