Federal Signal Corporation · NYSE:FSS
Federal Signal — Corporate Update (December 2004)
16 slides from Federal Signal's corporate update, Dec 21, 2004
Slide 1: 2005 Outlook Conference Call
Robert D. Welding, President and Chief Executive Officer: • Good morning everyone and thank you for joining us. I’d like to welcome you to our 2005 Outlook conference call. • Joining me is Stephanie Kushner, our CFO. She will be available to answer questions with me after some prepared remarks. 2005
Slide 2: Today's Agenda
• I will start with an update on our restructuring activities — including a review of what has taken place to-date and what you can expect in the near future. • Then, we will spend the bulk of the time on looking forward to 2005 and a preview of our longer term ambitions. • And finally, we will desc
Slide 3: Safe Harbor
• As always, please refer to our safe harbor statement in relation to forward-looking comments discussed today. • You can refer to our latest Annual Report to shareholders or our recent SEC filings for a more detailed discussion of the risks that are involved in our forward-looking statements. This
Slide 4: Restructuring Update: Status of Initiatives
• This chart shows the status of the restructuring initiatives we announced at the end of June. At the time we specifically identified 7 transactions and indicated that beyond those, a few businesses that we had determined to be non-core would be divested over time, if we could get fair price. • Wit
Slide 5: Slide 5
Slide 6: Fire Rescue and Refuse Restructuring
• Most of our restructuring activity during the past 6 months was directed at our two troubled businesses — Fire Rescue and Refuse • We have much of the heavy lifting behind us, except for transitioning production of rear-loader refuse bodies to Medicine Hat, which will occur in the first quarter of
Slide 7: Basis for 2005 Operating Plan
• Enough about the past — let’s look to the future and focus on growth and creating shareholder value. • We’ve just completed rolling together our budget for 2005, and our strategic plan out through 2009. • We are still not at a point where we are able to provide specific financial performance guida
Slide 8: 2005 Outlook by Business Group
So here’s our outlook for 2005: • This shows the range of our revenue growth margin expectations for each of our business groups for 2005, and about where we would expect to be toward the end of the 5 year planning horizon. But I’ll caution you that the 5-year numbers are targets. • You can see we h
Slide 9: Revenue Reconciliation 2004 to 2005
• The math is not complicated in this bridge of 2004 estimated revenue to our 2005 plan. • Growth is offsetting what we dropped, or expect to drop, with the divestitures. Now let’s move on to look at more detail for each of our groups. Revenue Reconciliation 2004 Estimated $1,200 Less Completed Dive
Slide 10: Environmental Products Group 2005 Outlook
• Continuing the trend from 2004, we expect that the non-Refuse businesses in the Environmental Products Group will perform very nicely again in 2005. • Based on our traction and backlog, we expect to see 8% — 10% revenue growth in 2005. • Although we expect to see strength across all of our product
Slide 11: Fire Rescue 2005 Outlook
• In Fire Rescue we have a new management team in place including Marc Gustafson, named President two months ago, and some key staff members that he’s brought in over the past several weeks — namely a new VP of HR, VP of Purchasing & Materials, and VP of Sales & Distribution. In addition we have bro
Slide 12: Safety Products Group 2005 Outlook
• Post-divestitures, Safety Products Group revenue grows nicely and margins improve as Management devotes more time to growing their core products. • We are entering 2005 with two large airport projects in backlog — Dallas Fort Worth and Port Authority of New York and New Jersey. In addition, we exp
Slide 13: Tool Group 2005 Outlook
• Our Tool Group revenue growth is less spectacular with our growth rate in the U.S. moderating slightly, reflecting a comfortable but less robust GNP growth rate. • We see some recovery in Germany which has been very weak for most of 2004, although France softens further in 2005. • After a nice inc
Slide 14: Economic Value Measurement System
• When I joined Federal Signal a little over a year ago, I set out to help transform a good business that was struggling, into a great business that generates impressive shareholder value over a sustained period. • In order to do this I knew I had to make some significant changes, not only to our bu
Slide 15: Summary: Longer-Term Growth and Margin Targets
• In summary, we are working to transform this company to one with top line sales growth in the range of 8-10% per annum. We expect two thirds of this growth to be organic, with the balance coming from focused acquisitions that build on our core products. More growth will be overseas than domestic,
Slide 16: Q&A
• With that I’d like to open it up for Q&A. • Operator, please open the lines. (Due to a technical problem, no questions were raised.) Thank you , for a very fine job of managing this conference. I’d like to thank all of the participants again for your interest in Federal Signal and I look forward t