Cts Corporation · NYSE:CTS
Cts — Q2 2022 Earnings Presentation
17 slides from Cts's earnings presentation, Jul 26, 2022
Slide 1: CTS Corporation 2nd Quarter 2022 Earnings Call
CTS Corporation 2nd Quarter 2022 Earnings Call July 26, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This document contains statements that are, or may be deemed to be, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, any financial or other guidance, sta
Slide 3: Q2 2022 – Executing on portfolio demand, diversification to achieve profitable growth
Q2 2022 – Executing on portfolio demand, diversification to achieve profitable growth Second Quarter • Organic growth +8.7% • Non-transportation revenues +21.1%, organic 14.1% $145M 36.1% $0.62 • Transportation revenues +4.4% Sales Adj. Gross Margin Adj. diluted EPS • Tewa acquisition added $4.1m in
Slide 4: Establishing leadership in non-transportation end markets
Establishing leadership in non-transportation end markets Industrial Medical Aerospace & Defense Revenue Revenue Revenue ($ Millions) ($ Millions) ($ Millions) $133 $104 $48 $47 $81 +31% $39 $39 $33 +37% $25 +0.4% 2020 2021 1H 2022 2020 2021 1H 2022 2020 2021 1H 2022 Gaining in commercial sonar w/pi
Slide 5: Strategic acquisitions fueling diversification – M&A as a catalyst
Strategic acquisitions fueling diversification – M&A as a catalyst Enhancing Piezoceramic Technology and Geographic Reach Pre 2016 2016 2017 2022 Current Bulk Single Crystal Tape Cast Medical Therapeutics Growing Technology Technology Technology Europe Defense Piezoceramic Platform Building a Strong
Slide 6: CTS Portfolio Available
>95% Light Vehicle portfolio carries over to Electric Vehicles Accelerator Modules Chassis Height Sensor Accelerator Modules Chassis Height Sensor eBrake™ CTS a Portfolio Seat Belt Buckle Seat Track Position Seat Belt Buckle Seat Track Position AC Motor Switch Sensor Sensor Switch Sensor Sensor Curr
Slide 7: Electric Vehicle Platform wins in Q2 2022 – Total 17 in 2022
10 Electric Vehicle Platform wins in Q2 2022 – Total 17 in 2022 17 YTD 2022 EV Wins 8% of 2022 light vehicle sales from EV/Hybrid platforms, Goal: >25% by 2025 7
Slide 8: FY 2022 Guidance
FY 2022 Guidance Revenue Adj. Diluted EPS Key Outlook Assumptions ($ Millions) 2020-2022 2020-2022 $2.55 CAGR 11.3% 3 $600 CAGR 30.3% 3 $2.40 - Non-transportation markets $570 $513 robust in 1H, monitoring 2H $1.93 $424 demand $293 $1.29 - Light vehicle market – US 13- $1.12 14.5M, China ~24-25M, Eu
Slide 9: 2nd Quarter 2022 Financial Results
2nd Quarter 2022 Financial Results
Slide 10: Q2 2022 Financial Summary Highlights
Q2 2022 Financial Summary Highlights Revenue $148 • Revenue up 11.9% vs. Q2 2021 and down ($ millions) $145 2% vs Q1 2022 $130 • Non-transportation sales up 21.1% vs Q2 2021, organic growth +14% • Transportation sales up 4.4% vs Q2 2021 • Adjusted EBITDA up 90 bps to 22.4% Q2 2021 Q1 2022 Q2 2022 •
Slide 11: Consistent strong cash flow generation
Consistent strong cash flow generation Operating Cash Flow Cash and Debt ($ Millions) ($ Millions) $86 $400 Total Facility $77 $35 $99 $91 Borrowed 2020 2021 YTD Q2 2022 Cash Debt Note: Cash and Debt balance as of June 30, 2022 Q2 2022 – $12.5 Q2 2022 – $7.7M YTD 2022 – $28.4 YTD 2022 – $11.7M Free
Slide 12: Q&A
Q&A cts
Slide 13: Appendix
Appendix cts
Slide 14: Regulation G Schedules – Adjusted Diluted EPS
Regulation G Schedules Adjusted Diluted EPS Q2 Q1 YTD Full Year 2022 2021 2022 2022 2021 2021 2020 Diluted earnings (loss) per share $ 0.39 $ 0.03 $ 0.63 $ 1.02 $ 0.40 $ (1.30) $ 1.06 Tax affected adjustments to reported diluted earnings (loss) per share: Restructuring charges 0.02 0.01 0.01 0.03 0.
Slide 15: Regulation G Schedules – Adjusted EBITDA
Regulation G Schedules Adjusted EBITDA Q2 Q1 ($ Millions, except percentages) 2022 2021 2022 Net earnings (loss) $ 12.6 $ 0.9 $ 20.2 Depreciation and amortization expense 7.0 6.7 6.7 Interest expense 0.6 0.5 0.5 Tax expense (benefit) 4.3 (1.5) 5.5 EBITDA 24.5 6.6 33.0 Adjustments to EBITDA: Restruct
Slide 16: Regulation G Schedules – Adjusted Gross Margin
Regulation G Schedules Adjusted Gross Margin ($ Millions) Q2 2022 2021 Gross margin $ 51.8 $ 47.7 Adjustment to reported gross margin: Inventory fair value step-up $0.5 - Adjusted gross margin $ 52.4 $ 47.7 Net sales $ 145.0 $ 129.6 Adjusted gross margin as a % of net sales 36.1% 36.8% 16
Slide 17: Regulation G Schedules – Free Cash Flow
Regulation G Schedules Free Cash Flow ($ Millions) Q2 YTD Full Year 2022 2022 2021 2020 Net cash provided by operating activities $ 16.1 $ 35.4 $ 86.1 $ 76.8 Capital expenditures (3.6) (7.0) (15.6) (14.9) Free cash flow $ 12.5 $ 28.4 $ 70.5 $ 61.9 Free Cash Flow as % of Adjusted Net Earnings 62.8% 6