Visteon Corporation · NASDAQ:VC
Visteon — Deutsche Bank Global Auto Industry Conference 2016
43 slides from Visteon's conference presentation, Jan 12, 2016
Slide 1: Visteon Corporation, Deutsche Bank Global Auto Industry Conference
January 2016 Visteon Corporation Deutsche Bank Global Auto Industry Conference Exhibit 99.1
Slide 2: Agenda
Agenda Updates Since the Baird / Barclays Conferences Long-Term Plan and Strategic Imperatives Capital Return Program 2015 and 2016 Full-Year Guidance Page
Slide 3: Updates Since the Baird / Barclays Conferences
Updates Since the Baird / Barclays Conferences Received the vast majority of the Korean withholding tax refund relating to the HVCC transaction in early 2016 ~$250 million in total net proceeds Completed $500 Million Accelerated Share Repurchase (ASR) Program During Q4 2015 Increasing 2015 and 2016
Slide 4: Increasing 2015 and 2016 Targets
Increasing 2015 and 2016 Targets Increasing 2015 and 2016 Guidance – 12/31/2015 Backlog of $15.2 Billion, up 8% vs. the Beginning of the Year Please see appendix for important disclosures regarding “Forward Looking Information“ and “Use of Non-GAAP Financial Information” Prior Updated Sales $3.05-$3
Slide 5: FY 2015 New Business Wins and Rewins
FY 2015 New Business Wins and Rewins Lifetime Revenue $4.3 Average Annual Lifetime Revenue Memo: (Dollars in Billions) Visteon Won $1.35 Billion in New and Rewin Business During 2015 – Equating to $4.3 Billion in Lifetime Revenue Consolidated Wins and Rewins Customer Breakdown (FY 2015) N/A Page Ple
Slide 6: Balanced Sales Profile By Product
Balanced Sales Profile By Product Please see important disclosures regarding “Forward Looking Information“ Diverse Product, Regional and Customer Sales Profile Visteon Electronics 2015E Sales Breakdown By Mfg. Region By Customer Infotainment11% Connectivity & Telematics 7% HUD <1% Page
Slide 7: Our Vision and Mission
Our Vision: A top-three cockpit electronics player delivering a rich, connected cockpit experience for every car from luxury to entry. Our Mission: To be the foremost leader in driver information and connected infotainment solutions that enables a rich driving experience in a safe and convenient man
Slide 8: Broadest Portfolio in the Industry
Instrument Clusters Head-Up Displays Telematics Cockpit Domain Controllers Information Displays Audio Infotainment Please see appendix for important disclosures regarding “Forward Looking Information“ Broadest Portfolio in the Industry Singularly Focused on Cockpit Electronics Page Audio Information
Slide 9: Three Strategic Imperatives
Focused on Three Strategic Imperatives – Strengthen the Core, Move Selectively to Adjacent Products, Deliver Cost Efficiencies Audio Head-Up Displays Information Displays Infotainment Instrument Clusters Telematics Cockpit Domain Controllers (SmartCoreTM) Next Generation Safety Applications (e.g. V2
Slide 10: Offerings Across All Products in Cockpit Electronics
Offerings Across All Products in Cockpit Electronics Instrument Clusters Telematics Audio Infotainment Information Displays Offerings Across All Products * Do not offer cockpit domain controllers today but have potential to enter the market in the future. Cockpit Domain Controllers * * * Head-Up Dis
Slide 11: 2016 Consumer Electronics Show (CES)
2016 Consumer Electronics Show (CES) More than 1,000 total visitors (mostly pre-scheduled) 37 vehicle manufacturers represented Nearly 500 individual customers 84 investors 25,000 social media impressions 20 media briefings with publications such as Wall Street Journal, Forbes, Washington Post, Reut
Slide 12: Visteon Content at 2016 Detroit Auto Show
Examples of Visteon Content at 2016 Detroit Auto Show Page Ford Fusion 4” multi-functional display Chevrolet Cruze Wireless charging Infiniti Q60 Audio auxiliary box Lincoln Continental Reconfigurable cluster Hyundai 2016 Ioniq (AE) Cluster Please see appendix for important disclosures regarding “Fo
Slide 13: Strategy Recap
Strategy Recap Page Strengthen the Core Move Selectively to Adjacent Products Drive to 12% Adjusted EBITDA Margins Sales Progression (Dollars in Billions) Please see appendix for important disclosures regarding “Forward Looking Information“ and “Use of Non-GAAP Financial Information” Drive to 12% EB
Slide 14: Capital Return Update
January 2016 Capital Return Update
Slide 15: Capital Return Update
Capital Return Update Announced $1.75 Billion Special Cash Distribution to Shareholders Visteon’s board of directors declared a special cash distribution in the amount of $43.40 per share on Dec. 10, 2015 Record date of Jan. 15, 2016 Expected ex-dividend date of Jan. 25, 2016 (as set by the NYSE) (1
Slide 16: Share Repurchase History
Share Repurchase History Since the fourth quarter of 2012, we have repurchased 14.8 million shares at an average price of $87.65 Share Repurchase History Please see appendix for important disclosures regarding “Forward Looking Information“ and “Use of Non-GAAP Financial Information” Page We Have Rep
Slide 17: Capital Structure
Capital Structure Even after a $2.75 billion capital return and spending another ~$275 million in 2015 and 2016 on legacy disposals and reorganization, Visteon retains a substantial net cash position versus our peer group Visteon is in a Net Cash Position vs. a Net Debt Position for Key Competitors
Slide 18: 2015 Financial Update
January 2016 2015 Financial Update
Slide 19: 2015 Financial Update
2015 Financial Update Expect strong full-year 2015 financial results We are increasing 2015 Guidance for Adjusted EBITDA and Adjusted Free Cash Flow to reflect strong operational performance during the fourth quarter We are also increasing lifetime backlog 12/31/15 backlog of $15.2 billion, up 8% vs
Slide 20: Backlog (12/31/2015)
Backlog (12/31/2015) (Dollars in Billions) Visteon disclosed new definition of backlog at Q3 earnings conference call Backlog now represents cumulative remaining life-of-program booked sales Visteon Backlog: 9/30/2015: $14.6 billion 12/31/2015: $15.2 billion Lifetime booked sales / 2015E sales = ~4.
Slide 21: 2016 Guidance
January 2016 2016 Guidance
Slide 22: 2016 Guidance (Electronics and Corporate Only)
2016 Guidance (Electronics and Corporate Only) 2016 Guidance Sales $3.2 B Adjusted EBITDA $305-335 M Adjusted Free Cash Flow $110-150 M Other Selected Items: 2016 Guidance Depreciation and Amortization $90 M Tax Expense $65 M Restructuring Expense $20-30 M Capital Spending $80-90 M 2016 Sales and Ad
Slide 23: Adjusted EBITDA: 2016 vs. 2015 Guidance
Adjusted EBITDA: 2016 vs. 2015 Guidance 2016 sales are projected to increase by $100 million year-over-year Increased volumes and new business partially offset by unfavorable currency and customer pricing 2016 Adjusted EBITDA projected to increase to $320 million, or 10% of sales vs. 9.4% in 2015 In
Slide 24: Adjusted Free Cash Flow: 2016 vs. 2015 Guidance
Adjusted Free Cash Flow: 2016 vs. 2015 Guidance (Dollars in Millions) Specific Items Benefiting 2015 Cash Flow Capitalized Engineering ($10) Tax Refunds Related to Previous Years (15) Subtotal ($25) 2016 Budget Adjusted Free Cash Flow of $130 Million is $60 Million Lower than 2015 – Largely Reflecti
Slide 25: Closing Thoughts
January 2016 Closing Thoughts
Slide 26: Closing Thoughts
Page Closing Thoughts 2015 Accomplishments for Continuing Operations Significant year-over-year profit improvement despite unfavorable currency Achieved upper range of targeted synergies related to JCI acquisition Returned $500 million of capital to shareholders Announced $1.75 billion special cash
Slide 27: Appendix
January 2016 Appendix
Slide 28: Forward-Looking Statements
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 uncertainties that could cause our a
Slide 29: Use of Non-GAAP Financial Information
Because not all companies use identical calculations, Adjusted EBITDA, Free Cash Flow and Adjusted Free Cash Flow used throughout this presentation may not be comparable to other similarly titled measures of other companies. In order to provide the forward-looking non-GAAP financial measures for ful
Slide 30: The Visteon Plan
The Visteon Plan Long-Term Growth Opportunity Short-Term Value Accretion Product Focus & Growth Margin & Cash Flow Improvement Customer & Geographic Extension Capital Structure Transition Strengthen the Core Continue to lead market in next generation cluster, head-up display (“HUD”), connected audio
Slide 31: Automotive Instrument Cluster Market
Automotive Instrument Cluster Market Global Market Revenue Total market: 2015 $7.0B / 2020 $9.5B / CAGR 6% Page CAGR -7% CAGR 2% CAGR 32% Key Criteria High Full reconfigurable TFT Rich 3D graphics Hybrid gauges + 7”/8” TFT 2.5D or 3D graphics Mid Hybrid gauges + 4” TFT 2D or 2.5D graphics Low Hybrid
Slide 32: Automotive Information Display Market
Automotive Information Display Market Key Criteria High Display behind flat/curved lens Touch screen Optical bonding New display technologies (e.g. OLED) Haptics Entry Poke-through display with or without touch No cover lens Graphics processing optional Global Market Revenue Total market: 2015 $2.5B
Slide 33: Automotive Head-Up Display Market
Automotive Head-Up Display Market Key Criteria Augmented Reality W-HUD TFT, laser, or DLP 10°-12°x 3°-5° FOV Luminance 15kcd/m² Electrical tilt W-HUD 4°-10°x 1.5°-3° FOV Luminance 10-15kcd/m² Electrical tilt C-HUD Full color 1.2”, 1.8”, 3.1” TFT 3°-8° x 1.5°-2° FOV Luminance 6-12kcd/m² Kinematics dr
Slide 34: Automotive Audio Market
Automotive Audio Market Key Criteria Display Audio 8” color TFT Capacitive touch 2D graphics CarPlay, Android Auto, CarLife Bluetooth, WiFi, USB Audio Low LCD or silver box AM/FM/digital radio USB, Bluetooth Class AB amp Global Market Revenue Total market: 2015 $6.6B / 2020 $8.4B / CAGR 5% Page CAGR
Slide 35: Automotive Infotainment Market
Automotive Infotainment Market Key Criteria High 10”-12” color LCD with touch 3D graphic OpenGL Multiple user / multiple HMI High-end embedded navigation USB/Bluetooth/WiFi multimedia Cloud apps Mid 8”-10” color LCD with touch 3D graphics OpenGL Embedded navigation USB/Bluetooth multimedia CarPlay,
Slide 36: Automotive Telematics Market
Automotive Telematics Market Key Criteria Wireless Gateway Multiple access and wireless connections Data caching/Adv FOTA Adv. Security and Smart IP Routing TCU Cellular / Bluetooth / Wi-Fi Remote vehicle functions FOTA node / remote diagnostics Internet connectivity / IP router eCall Emergency call
Slide 37: Advanced Driver Assistance Systems (ADAS) and HMI
Focus on integrating camera-based safety features in IC and infotainment Rear camera, surround view, forward collision warning and lane departure warning New “driver monitoring” feature for drowsiness detection Integration using SmartCore™ architecture offers significant cost-reduction opportunity N
Slide 38: 2016 Full-Year Vehicle Production Volume Outlook
2016 Full-Year Vehicle Production Volume Outlook IHS full-year 2016 forecast up 3.2% vs. 2015 Driven by higher volumes in all regions, except for South America Note that Ford volumes globally are expected to be up 2.0% Note: Global vehicle production volumes based on IHS December 2015 forecast. 2016
Slide 39: 2016 Exchange Rate Assumptions
As of January 11, 2016. Excludes potential impact of currency hedges. (1) Current Spot Rates Have Moved Since 2016 Budgeted Rates Set in November 2015 – The Net Impact of the Currency Changes Results in Minimal Impact on Visteon 2016E EBITDA 2016 FY Impact of Movements in FX Rates (2) Page 2016 Exch
Slide 40: Adjusted EBITDA 2015 / 2016 Guidance Reconciliation
Adjusted EBITDA (Electronics & Corporate Only) Page 2015 / 2016 Guidance Reconciliation
Slide 41: Free Cash Flow and Adjusted Free Cash Flow Reconciliation
Free Cash Flow and Adjusted Free Cash Flow (Electronics / Corporate Only) Page 2015 / 2016 Guidance Reconciliation (cont’d)
Slide 42: Restructuring and Transformation Cash Payments / Tax Recovery
We expect to incur restructuring / integration cash outflows for Electronics and Corporate of $80 million in 2015 and $65 million in 2016 (all payments relate to expenses that are excluded from Adjusted EBITDA) We also expect to incur $364 million in cash outflows related to former Climate / Interio
Slide 43: www.visteon.com
www.visteon.com
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