Visteon Corporation · NASDAQ:VC
Visteon — J.P. Morgan Conference August 2013
44 slides from Visteon's conference presentation, Aug 13, 2013
Slide 1: Delivering Value
Exhibit 99.1 Our Family of Businesses Electronics Interiors Delivering Value J.P. Morgan Conference – August 2013 Yanfeng Visteon
Slide 2: Today We Will…
Today We Will… Provide Q2 2013 highlights Update the status of the Company’s “Value Creation Plan” first presented on September 19, 2012 Review the YFV transaction Outline the Visteon vision Page 2
Slide 3: Q2 2013 Highlights
Our Family of Businesses Electronics Interiors Q2 2013 Highlights J.P. Morgan Conference – August 2013 Yanfeng Visteon
Slide 4: Second Quarter 2013 Recent Highlights
Second Quarter 2013 Recent Highlights Strong Second-Quarter 2013 Performance – Sales of $1.9 billion vs. $1.7 billion in second-quarter 2012 – Adjusted EBITDA of $187 million vs. $147 million in second-quarter 2012 – Adjusted net income of $71 million Adjusted EPS of $1.41 – Strength in Climate and
Slide 5: Status of "Value Creation" Plan
Our Family of Businesses Electronics Interiors Status of “Value Creation” Plan J.P. Morgan Conference – August 2013 Yanfeng Visteon
Slide 6: Decision Cornerstones
Decision Cornerstones Base strategic decisions on “industrial logic” and a realistic assessment of strengths and weaknesses – No smaller than #3 in relevant market presence – Core strengths must include technology or “know-how” leverage Provide customers with well financed, international-capable bus
Slide 7: Visteon: The Plan (September 19, 2012)
Visteon: The Plan (September 19, 2012) 100% 50% 70% 100% 100% Visteon Visteon Visteon Yanfeng Climate Interiors Electronics Visteon Sell Visteon Climate to HCC for cash 40% Remains non-core 60% Establishes “New Halla-Visteon Climate YFV Continue to pursue Group” (HVCG) as single consolidated Electro
Slide 8: Visteon: The Status (August 13, 2013)
Visteon: The Status (August 13, 2013) The Plan Visteon Status Overview Completed Q1 2013 70% 100% HVCC now #2 largest global auto climate business in the world Visteon Significant synergies already achieved, further Climate opportunities in process Sell Visteon Climate to HCC for cash HVCC stock pri
Slide 9: Visteon: The Status (August 13, 2013)
Visteon: The Status (August 13, 2013) The Plan 50% Yanfeng Visteon Status Visteon Overview Definitive agreement to sell YFV (ex. YFVE) signed August 12, 2013 Overall transaction valued at $1.5 billion Yanfeng Visteon Visteon will sell non-Electronics position for $1.2 billion in cash YFV and affilia
Slide 10: Visteon: The Status (August 13, 2013)
Visteon: The Status (August 13, 2013) The Plan 100% Visteon Status Overview Visteon Electronics Solidifies #3 global position in driver information and controls 40% Visteon Electronics will consolidate majority of YFVE’s former operations, creating: YFV Electronics – ~$1.7 billion in 2013E sales ($3
Slide 11: Visteon: The Status (August 13, 2013)
Visteon: The Status (August 13, 2013) (Dollars in Millions) Visteon Status Overview Fixed Costs and SG&A Spend (Originally Presented at DB Conference in Jan 2013 / “Corporate centric” business model being Updated for 2012 Actual and 2013 Latest Outlook) replaced with “stand-alone” capable business u
Slide 12: The YFV Transaction
Our Family of Businesses Electronics Interiors The YFV Transaction J.P. Morgan Conference – August 2013 Yanfeng Visteon
Slide 13: YFV Transaction: Overview
YFV Transaction: Overview Visteon is selling its 50% stake in YFV as well as direct stakes in certain Yanfeng-related affiliates (i.e. Halol, Jinqiao, Tooling, Toppower) Transaction Visteon is increasing ownership stake in YFVE – Purchasing 11% of YFVE to bring Visteon’s stake to 51% – Purchasing 50
Slide 14: YFV Transaction: YFVE Structure
YFV Transaction: YFVE Structure YFVE Simplified Structure Future YFVE Structure Post the transaction, Visteon will 29.1% own: YFV Visteon – 51% stake in YFVE and its main 60% 40% fully owned operations in YFVE Sky Captain Songjiang, China Current 12.5% – 50% of a New HoldCo which will 58.4% own 49%
Slide 15: YFV Transaction: Proceeds
YFV Transaction: Proceeds (Dollars in Millions) Transaction Proceeds Amount Paid Value of YFV 50% Stake $928 At Close Direct Stakes in Other Interiors JVs 96 June 2015 (1) Dividends from Other Interiors JVs 28 June 2014 / June 2015 Gross Proceeds $1,053 YFVE Valuation (2) Cash Distribution 198 At or
Slide 16: Visteon Electronics Business
Visteon Electronics Business (Dollars in Millions) Visteon Electronics – 2012 Visteon Cockpit Electronics Business Adjusted $3,000 Sales EBITDA Visteon Electronics – Base $1,274 $126 $2,500 Remove YFVE Equity Income – (14) VC Electronics (ex. YFVE) $1,274 $112 $2,000 New YFVE 457 40 Elims (137) – $1
Slide 17: YFV Transaction: Impacts to Visteon
YFV Transaction: Impacts to Visteon (Dollars in Millions) YFV Dividend History (ex. Electronics) 2009 $35 2010 $12 2011 $42 2012 $70 Impact to Visteon Reported Adjusted EBITDA (Visteon EBITDA Includes YFV Equity Income) YFV + Visteon Direct Stakes (1) Est. YFVE Est. YFV Non- EBITDA Support YFVE YFVE
Slide 18: Post YFV
Our Family of Businesses Electronics Interiors Post YFV J.P. Morgan Conference – August 2013 Yanfeng Visteon
Slide 19: Visteon: Post YFV
Visteon: Post YFV 70% 100% 100% Electronics Interiors #2 in the world in high-growth #3 in the world in driver World-class IP technology climate market information and controls Managing through Europe 7%+ Revenue CAGR 12%+ Revenue CAGR downturn Restructuring business Powerful technology Powerful tec
Slide 20: Climate Segment Undergoing Revolution in Product
Climate Segment Undergoing Revolution in Product EV & Hybrid Battery Powertrain Cooling Fluid Cooling Transport Compressors HVAC HVCC: One of Only Two Climate Companies With A Complete Product Line Page 20 Please see appendix for important disclosures regarding “Forward Looking Information“
Slide 21: Visteon: HVCC Driving Climate Technology
Visteon: HVCC Driving Climate Technology Fuel Cell Vehicle Hybrid and Electric Vehicle Technologies Technologies Battery Chiller and Brushless DC Contact Heat Exchanger Cooling Module Precise battery temperature control Electric Compressor High-Voltage Positive Lightweight, High-Performance Temperat
Slide 22: Visteon: HVCC Innovative Technologies and Strong IP
Visteon: HVCC Innovative Technologies and Strong IP Innovative Technologies Intellectual Property Metal Seal Fitting for Reducing Refrigerant Leakage # of Released Patents HVCC Competitor A Competitor B 400 Competitor C Competitor D 2013 PACE Award 300 Heat Pump System for Electric Vehicle 2012 New
Slide 23: Automotive Converges with Consumer Electronics
Automotive Converges with Consumer Electronics Next Generation User Interface Open Source Software Environment Cloud Always Content & Connected Services “Pipeline” Page 23 Note: Logos above are trademarks and copyrights of the respective companies. Please see appendix for important disclosures regar
Slide 24: Visteon: Driving Electronics Technology
Visteon: Driving Electronics Technology Advanced Instrument Clusters • Third generation reconfigurable clusters • Leading 3-D graphics • Superior display resolution Next Generation Display Technologies • Consumer electronics-driven user interaction • OEM styling freedom • Optimized viewability Open
Slide 25: Visteon: Driving Technology
Visteon: Driving Technology Generating Growth, Generating Value Page 25 Please see appendix for important disclosures regarding “Forward Looking Information“
Slide 26: Visteon: Post YFV (Financial Outlook)
Visteon: Post YFV (Financial Outlook) Revenue Adjusted EBITDA Cash $7.8 - $660 - $7.3 - $7.3 - $620 - $2.1B $8.0B $690M $600 - $7.5B $7.5B $660M $640M $1.0B Interiors (ex. YFV) 2013 2013 2014 Post 2013 2013 2014 Post 6/30/2013 6/30/2013 PF for Original Revised YFV Original Revised YFV YFV Transactio
Slide 27: Going Forward
Going Forward Visteon Focusing on Core Value Creating Assets – Both core businesses among industry leaders – Both exhibit higher than segment growth – Bottom line being enhanced by Corporate fixed cost & SG&A reductions YFV Transaction Affords Significant Balance Sheet Optimization… The Plan: $1 Bil
Slide 28: Appendix
Our Family of Businesses Electronics Interiors Appendix J.P. Morgan Conference – August 2013 Yanfeng Visteon
Slide 29: Forward-Looking Information
Forward-Looking Information This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various factors, risks and uncertai
Slide 30: Use of Non-GAAP Financial Information
Use of Non-GAAP Financial Information Because not all companies use identical calculations, Adjusted Gross Margin, Adjusted SG&A, Adjusted EBITDA, Adjusted Net Income, Adjusted EPS, Free Cash Flow and Adjusted Free Cash Flow used throughout this presentation may not be comparable to other similarly
Slide 31: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information Sales 2012 2013 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr Net sales, products (incl. discontinued operations) $1,856 $1,819 $1,656 $1,823 $7,154 $1,856 $1,892 Less: Discontinued operations 139 126 32 - 297 - - Net
Slide 32: Reconciliation of Non-GAAP Financial Information (cont'd)
Reconciliation of Non-GAAP Financial Information (cont’d) Adjusted EBITDA 2012 2013 2013 FY Guidance 2014 FY Guidance (Dollars in Millions) Full Year 1st Qtr 2nd Qtr Low-end High-end Low-end High-end Adjusted EBITDA $626 $170 $187 $660 $690 $600 $640 Interest expense, net 35 10 9 40 40 55 45 Provisi
Slide 33: Reconciliations of Adjusted Net Income, Earnings per Share and Adjusted Earnings per Share
Reconciliations of Adjusted Net Income, Earnings per Share and Adjusted Earnings per Share 2012 2013 2013 FY Guidance (Dollars and Shares in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr Low-end High-end Net income (loss) attributable to Visteon ($29) $75 $15 $39 $100 $69 $65 $
Slide 34: Reconciliation of Climate Financial Information
Reconciliation of Climate Financial Information Climate 2012 2013 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr YTD Product Sales $1,023 $1,065 $1,024 $1,174 $4,286 $1,228 $1,247 $2,475 Gross Margin $89 $81 $89 $119 $378 $112 $121 $233 Employee Charges / Corp Severa
Slide 35: Reconciliation of Electronics Financial Information
Reconciliation of Electronics Financial Information Electronics 2012 2013 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr YTD Product Sales $329 $304 $304 $337 $1,274 $365 $354 $719 Gross Margin $29 $33 $23 $53 $138 $37 $41 $78 Employee Charges / Corp Severance - - -
Slide 36: Reconciliation of Interiors Financial Information
Reconciliation of Interiors Financial Information Interiors 2012 2013 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr YTD Product Sales $393 $352 $307 $336 $1,388 $317 $334 $651 Gross Margin $16 $14 $17 $27 $74 $5 $23 $28 Employee Charges / Corp Severance - (1) - (3)
Slide 37: Reconciliation of YFVE Adjusted EBITDA
Reconciliation of YFVE Adjusted EBITDA YFVE – Pro Forma Adjusted EBITDA Impact to Visteon Post Transaction 2012 Actual 2013 Full-Year Estimate 2013 Actual (Dollars in Millions) Full Year Low-end High-end 1st Half Adjusted EBITDA $40 $40 $45 $21 Interest expense, net 2 2 2 1 Provision for income taxe
Slide 38: Second-Quarter 2013 Key Financials
Second-Quarter 2013 Key Financials (Dollars in Millions) Second-Quarter Q2 2013 2012 2013 B/(W) 2012 Sales $1,693 $1,892 $199 Adjusted Gross Margin $130 $185 210 bps 7.7% 9.8% Adjusted SG&A $81 $87 20 bps 4.8% 4.6% Adjusted EBITDA $147 $187 120 bps 8.7% 9.9% Adjusted EPS $0.60 $1.41 $0.81 Free Cash
Slide 39: Sales and Adjusted EBITDA
Sales and Adjusted EBITDA (Dollars in Millions) Sales Adjusted EBITDA $1,892 $187 $1,693 $147 8.7% 9.9% Q2 2012 Q2 2013 Q2 2012 Q2 2013 Y/Y Performance Q2 Y/Y Performance Q2 Volume / Mix $214 Volume / Mix $45 Currency 2 Currency 5 Product Development (2) Business Equation 2 Other Changes (20) Equity
Slide 40: Second-Quarter 2013 Segment Financials
Second-Quarter 2013 Segment Financials (Dollars in Millions) Sales Adjusted EBITDA (Includes Equity in Affiliates and Non-Controlling Interests) Q2 2012 Q2 2012 $1,247 Q2 2013 Q2 2013 $119 $1,065 $86 $47 $354 $39 $352 $334 $35 $304 $30 Climate Electronics Interiors Climate Electronics Interiors Page
Slide 41: Cash Flow / Cash / Debt
Cash Flow / Cash / Debt (Dollars in Millions) Free Cash Flow Visteon Cash and Debt Q1 2013 Q2 2013 YTD 6/30/13 Adjusted EBITDA $170 $187 $357 Cash ex. HVCC $675 Trade Working Capital 97 (44) 53 HVCC Cash 333 Equity Earnings, Net of Dividends (1) (41) (44) (85) Total Cash $1,008 Cash Taxes (29) (50)
Slide 42: 2013 Guidance
2013 Guidance Prior Revised Product Sales $7.3 B - $7.5 B $7.3 B - $7.5 B Adjusted EBITDA $620 M - $660 M $660 M - $690 M Free Cash Flow Free Cash Flow (1) ($75) M - $25 M ($25) M - $50 M Adjusted Free Cash Flow (ex. Restructuring and Transaction-Related) $100 M - $150 M $135 M - $170 M Adjusted EPS
Slide 43: Visteon: Post YFV (Sales by Region)
Visteon: Post YFV (Sales by Region) Q2 2013 Global Production Visteon Consolidated Sales by Region 21.3 Million Units Current Post YFV Transaction SA 50% Asia SA SA 6% 5% NA NA 20% 19% AP AP 47% 43% 24% Europe EU EU 31% 29% 14% 20% N. America U.S. 6% S. America Global Industry Production Source: IHS
Slide 44: www.visteon.com
www.visteon.com