Slide 1: Investor Presentation March 2012
Exhibit 99.1 Investor Presentation March 2012
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation 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, stat
Slide 3: CTS Corporation - Profile
CTS Corporation - Profile Components & Sensors Segments EMS Sensors & Actuators 32% 49% 19% Electronic Components Projected Sales A global designer and manufacturer of highly engineered: • Sensors & Actuators, • Electronic Components, • and a provider of Electronics Manufacturing Services Establishe
Slide 4: Global Operations
Global Operations Auburn Hills Toronto, Canada Scotland Lisle Londonderry Czech Republic San Jose Switzerland Japan Moorpark Boston Elkhart China Tucson Taiwan Albuquerque Matamoros, Mexico India Thailand Nogales, Mexico Singapore Headquarters Manufacturing Sales Office Global footprint and diversif
Slide 5: Sales By Market and Geographic Regions
Sales By Market and Geographic Regions Sales by Market Sales By Region 5% Defense/ Europe Aerospace 12% 19% Automotive 29% North America Asia Industrial 30% 58% 18% Communications Medical 22% 6% Other 6% 12% Low Cost Manufacturing 47% Diversified markets and a global (lower cost) manufacturing footp
Slide 6: Sensors and Actuators
Sensors and Actuators Expect double-digit sales growth over the next 3-5 years • Macro Trend Driving Growth – Tougher emissions standards Sensors/ Actuators – Need for increased fuel economy 32% Sales • New Products and New Customers – On and off highway diesel engine applications – Small turbocharg
Slide 7: Growth Drivers - Pedal Modules
Growth Drivers - Pedal Modules CTS Pedal Sales $M M ajo r cu sto mers in No rth Target 142 130 A m e r i c a, E u r o p e and Asia. Captured 120 98 91 72 67 49 30 Total 2006 2007 2008 2009 2010 2011 2012 2013 2014 Available Market $339 $385 $369 $325 $411 $438 $479 $511 $541 (Including Pedal Sensors
Slide 8: New Growth Drivers – Sensors and Actuators
New Growth Drivers – Sensors and Actuators • Organic growth driven by strong research and development R&D 7.1% of Components and Sensors sales – 7 year high • Highly engineered products improve fuel economy and reduce emissions • Serves light vehicles and commercial markets $60 Products Sales $ in M
Slide 9: Electronic Components
Electronic Components Double-digit sales growth over the next 3-5 years • Macro Trends Driving Growth EC – Strong wireless communication growth in emerging markets 19% – Global markets driving higher data traffic Sales Smart phones, Social networking; YouTube, Facebook • New Growth Drivers: New Piez
Slide 10: Electronic Components – Communications Infrastructure
Electronic Components – Communications Infrastructure Sales ActiPlex® Filters Satellite Wireless $ in Millions Communications Base Station $90 OCXO $75 $60 Clock Oscillators $45 Ceramic Duplexer $30 $15 EMI Filters $0 Defense 2009 2010 2011 2012 2013 Communications WiMAX Key Customers: Alcatel–Lucen
Slide 11: Electronic Components – Piezoceramic Products
Electronic Components – Piezoceramic Products Medical Ultrasound Aerospace Sales 40 $ in Millions Soft And 30 New Hard Products Piezo Ceramic Hard Disk Drive Actuation 20 Materials - New generation of HDD actuation for computer market Wide Format Undersea Energy Inkjet Printer Head Exploration 10 0
Slide 12: Electronics Manufacturing Solutions
Electronics Manufacturing Solutions Mid single-digit sales growth business over the next 3-5 years • Strategic Focus Sales – Target customers with complex needs EMS – Target niche sectors – defense & aerospace, medical, industrial 49% – Provide turnkey services, design to direct ship • Specialized T
Slide 13: Electronics Manufacturing Solutions
Electronics Manufacturing Solutions Other 3% Improving Performance 2004 Market Diversification Operating Margin Before Corporate Charges Communications 7.0% 29% Computer 68% 5.2% 5.0% Targeted Area > 65% 2011 Industrial 24% Defense/ 2.5% Aerospace 2.2% 32% Medical 9% Communications 4% 2007-2009 2010
Slide 14: Financial Summary
Financial Summary Definitions and reconciliation of non-GAAP financial terms are included on CTS’ Web site at www.ctscorp.com
Slide 15: Financial Performance Trend
Financial Performance Trend Sales ($M) Adjusted EPS $665 $0.80 $647 $0.75 $589 $0.66 $0.67 $553 $499 $0.36 2009 2010 2011 2012 2009 2010 2011 2012 Guidance Guidance • 2011 growth tempered by impact of Japan earthquake / tsunami and Thailand floods • 2012 growth driven by new products, new programs,
Slide 16: Balance Sheet Trends
Balance Sheet Trends Controllable Working Capital* Capital Expenditures 20% 18% 16% 14% 2% 2% - 3% 13%-14% 12% 10% 8% 0% 2009 2010 2011 Target 2009 2010 2011 Target * Controllable Working Capital Defined as Accounts Receivable + Inventories - Accounts Payable. • Higher working capital in 2010-2011 d
Slide 17: Free Cash Flow
Free Cash Flow $ in Millions Pre-Recession $40 Normal $40 Average Approx. $20M $20-25M $30 $23 $21 Recession/ $20 Recovery Average $18M $16 $10 $9 $6 $0 2006-2008 2009 2010 2011 2012 Guidance Note: Free Cash Flow defined as net cash provided by operations, less capital expenditures • Free cash flow
Slide 18: Capital Structure
Capital Structure Total Debt to Capitalization Current Capital Structure $90 25% 22% 20% $75 $73 $74 $70 $76 20% 17% Bank $60 Debt $51 15% $74 Equity $50 $45 10% $30 5% $15 Amended Bank Agreement in January 2012 $0 0% Increased our facility from $150M to $200M 2009 2010 2011 Lowered pricing by 25 bp
Slide 19: Target Adjusted Return on Invested Capital (ROIC)
Target Adjusted Return on Invested Capital (ROIC) 12% ROIC 10% Components 2012 10% - 11% & Sensors OPERATING Target Range MARGIN 8% AFTER-TAX 2011 8.5% (NOPAT Margin) 6% 2010 8.9% 12 4% 10 11 2009 5.0% 2% 09 EMS 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 INVESTED CAPITAL TURNOVER 2011 ROIC impacted by Japan ea
Slide 20: Positioned For Profitable Growth
Positioned For Profitable Growth • Winning new business and new customers with innovative products and technology Smart actuators, turbocharger sensors, grill shutter actuators, electromagnetic filters, hard piezo micro actuators, digital encoders, industrial joysticks, precision TCXOs Penetrated ne
Slide 21: Appendix
Appendix Innovation and Quality Driving Growth le CORPORATION
Slide 22: 2011 Governance Enhancements
2011 Governance Enhancements For many years, CTS has maintained robust corporate governance policies. During 2011, CTS’ Board of Directors took the following actions to further strengthen CTS’ corporate governance. • Change in Control Severance Agreement – Revised change in control severance agreeme
Slide 23: Sensors and Actuators
Sensors and Actuators Technologies: Capabilities: • Research, Design & Engineering • Thick Film Resistive Ink Systems • Custom Molding • Hall-effect Non-contacting Systems • Highly Automated Manufacturing • BLDC High-Torque Electromagnetics • Global Footprint: N. America, Asia, Europe Products: Rota
Slide 24: Electronic Components
Electronic Components Technologies: • Thick Film Resistive Ink Systems Capabilities: • Research, Design & Engineering • Quartz, Hard & Soft Piezoceramics • Custom Packaging • Electronic-grade Ceramics • ISO 13485, 9001, 14001 Certifications • Precision Coatings • North America and Asia Footprint Pro
Slide 25: Electronic Manufacturing Solutions
Electronic Manufacturing Solutions Quality / • ISO 13485, 9001 • AS9100 Capabilities: • Complex PCB’s and Boxbuilds Regulatory: • CFR 820 • ITAR / NISP • Custom Design & Engineering • FDA Class I to III • Mil Spec • Secure Manufacturing • Turnkey Services – Design thru Direct Ship • IPC Class III •
Slide 26: Major CTS Competitors
Major CTS Competitors PRODUCTS COMPETITION Sensors and Actuators AB Electronics, Alps, Bosch, Bourns, Delphi, Denso, Continental, CST, Hella, Mikuni Electronic Components Frequency Products - Infrastructure Mini-circuits, Mtron, Morion, NDK, Rakon, RFMD, Vectron Piezo electronics APC, Edo, Morgan El
Slide 27: Supplying the 'Green' Energy Market
Supplying the ‘Green’ Energy Market All-Electric Vehicles Hybrid Gas/Electric ‘Green’ Energy Sales $ in Millions Vehicles $18 Sensors $15 And Actuators $9 Zero- Emissions 8 Program 2 Wins $5 Program Wins $1 EMS 2009 2010 2011 2012 2013 New Electric Vehicle Market Strengthening; Providing Opportuniti
Slide 28: Financial Summary
Financial Summary $ in Millions 2011 2010 2009 2008 2007 Net Sales $588.5 $552.6 $499.0 $691.7 $685.9 Adjusted Operating Earnings $28.7 $29.5 $17.6 $37.0 $34.9 Adjusted Operating Earnings % of Sales 4.9% 5.3% 3.5% 5.3% 5.1% Adjusted Net Earnings $23.4 $23.1 $12.0 $26.5 $26.0 Adjusted Net Earnings %
Slide 29: Other Financial Data – Income Statement
Other Financial Data – Income Statement 2011 2010 $ in Millions Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Net Sales $144.0 $146.1 $146.9 $151.5 $145.0 $139.4 $138.9 $129.4 Adjusted Gross Margin Percentage 19.6% 19.4% 19.4% 19.2% 20.3% 21.5% 21.9% 23.6% Adjusted Operating Earnings $9.6 $7.8 $5.5 $5.8 $7.7 $7.8 $7.7 $6
Slide 30: Other Financial Data – Balance Sheet Metrics
Other Financial Data – Balance Sheet Metrics $ in Millions 2011 2010 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Accounts Receivable, net $88.3 $90.3 $87.8 $96.4 $95.9 $90.1 $84.6 $74.1 Inventories, net $92.5 $91.4 $88.6 $87.9 $76.9 $76.6 $68.8 $60.0 Accounts Payable $80.5 $78.9 $77.1 $79.4 $75.4 $70.5 $68.2 $59.5 Free
Slide 31: Appendix Regulation G
CTS CORPORATION APPENDIX 1 REGULATION G
Slide 32: Reconciliation of Gross Margin to Adjusted Gross Margin
CTS Corporation Reconciliation of Gross Margin to Adjusted Gross Margin ($ in millions) 2011 2011 2010 2010 2009 Full year Q4 Q3 Q2 Q1 Full year Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Gross Margin $109.8 $ 25.8 $ 27.5 $ 27.4 $ 29.2 $119.9 $ 29.1 $ 30.0 $ 30.3 $ 30.5 $ 30.9 $ 26.2 $ 21.9 $ 19.8 Charges (credits) to
Slide 33: Reconciliation of Operating Earnings to Adjusted Operating Earnings
CTS Corporation Reconciliation of Operating Earnings (Loss) to Adjusted Operating Earnings (Loss) ($ in millions) 2011 2010 2009 Full year Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 2011 2010 2009 2008 2007 Operating earnings / (loss) $ 7.2 $ 7.8 $ 4.5 $ 5.8 $ 6.0 $ 7.8 $ 7.7 $ 6.3 $ 8.3 $ 6.3 $ 3.2 $ (35.
Slide 34: Reconciliation of Net Earnings to Adjusted Net Earnings
CTS Corporation Reconciliation of Net (Loss) Earnings to Adjusted Net Earnings (Loss) ($ in millions) 2011 2010 2009 Full Year Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 2011 2010 2009 2008 2007 Net earnings / (loss) (A) 5.9 5.9 4.1 5.1 4.8 6.9 5.9 4.4 4.1 4.5 (7.0) (35.6) 21.0 22.0 (34.1) 28.1 $ 24.0 Char
Slide 35: Reconciliation of Diluted EPS to Adjusted Diluted EPS
CTS Corporation Reconciliation of Diluted (Loss) Earnings Per Share to Adjusted Diluted Earnings (Loss) Per Share 2011 2010 2009 Full Year Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 2011 2010 2009 2008 2007 Diluted earnings/(loss) per share $0.17 $0.17 $0.12 $0.15 $0.14 $0.20 $0.17 $0.13 $0.12 $0.13 $(0.21
Slide 36: Adjusted EBITDA Year-to-Date
CTS Corporation ADJUSTED EBITDA YEAR-TO-DATE ($ in millions) Full Year 2011 2010 2009 2008 2007 Net (loss) / earnings $ 21.0 $ 22.0 $ (34.1) $ 28.1 $ 23.9 Depreciation and amortization expense 17.5 17.6 19.5 24.2 22.8 Interest expense 2.1 1.1 1.9 6.2 5.5 Tax expense / (benefit) 5.4 6.0 13.6 (1.8) 6.
Slide 37: Adjusted EBITDA Quarter-to-Date
CTS Corporation ADJUSTED EBITDA QUARTER-TO-DATE ($ in millions) 2011 2010 2009 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Net earnings / (loss) $ 5.9 $ 5.9 $ 4.1 $ 5.1 $ 4.8 $ 6.9 $ 5.9 $ 4.4 $ 4.1 $ 4.5 $ (7.0) $ (35.6) Depreciation and amortization expense 4.4 4.4 4.4 4.4 4.3 4.3 4.5 4.4 4.6 4.4 5.2 5.3
Slide 38: Free Cash Flow
CTS Corporation Free Cash Flow ($ in millions) 2011 2010 2009 Full Year Q4 Q3-YTD Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 2011 2010 2009 2008 2007 Cash flows provided from (used by) operations $ 8.9 $ 13.4 $ 4.5 $11.3 $(2.5) $11.2 $ 1.7 $ 1.0 $ 5.3 $12.5 $18.4 $19.7 $(4.0) $ 22.2 $ 19.3 $46.6 $ 34.1 $ 48.6
Slide 39: Definition of Financial Term—Total Debt to Capitalization
CTS Corporation Definition of Financial Term—“Total Debt to Capitalization” ($ in millions) 2011 2010 2009 2008 2007 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Notes payable $ — $ — $ 0.2 $ — $ — $ — $ — $ — $ — $ — $ — $ 0.2 $ — $ — $ — $ — $ 1.0 $ 1.9 $ 1.5 $ 3.5 Current portion o
Slide 40: Definition—Controllable Working Capital as a Percentage of Annualized Sales
CTS Corporation Definition of Financial Term—“Controllable Working Capital as a Percentage of Annualized Sales” ($ in millions) Controllable working capital is defined as accounts receivable plus inventories less accounts payable Full Year October 2, July 3, April 3, Full Year October 3, July 4 Apri
Slide 41: Definition of Financial Term—Capex as Percentage of Sales
CTS Corporation Definition of Financial Term—“Capex as Percentage of Sales” ($ in millions) Full Year Q3 Q2 Q1 Full Year Full Year Full Year Full Year 2011 2011 2011 2011 2010 2009 2008 2007 Capex $ 15.6 $ 3.7 $ 3.4 $ 3.2 $ 13.3 $ 6.5 $ 17.6 $ 16.1 Total Sales 588.5 146.1 146.9 151.5 552.6 499.0 691
Slide 42: Definition of Financial Term—Adjusted Return on Invested Capital
CTS Corporation Definition of Financial Term— Adjusted Return on Invested Capital Full Year 2011 2010 2009 Operating earnings $ 25.2 $ 27.8 $ (17.8) Charges (credits) to reported operating earnings: Restructuring and asset impairment charges 3.1 1.7 2.2 Additional Legal Costs 0.3 Gain on sale of exc