Rogers Corporation · NYSE:ROG
Rogers — Q3 2020 Earnings Presentation
21 slides from Rogers's earnings presentation, Oct 29, 2020
Slide 1: Q3 2020 Earnings Call
Q3 2020 Earnings Call October 29, 2020 1
Slide 2: Forward-looking statements
Forward-looking statements Safe Harbor Statement This presentation contains forward-looking statements, which concern our plans, objectives, outlook, goals, strategies, future events, future net sales or performance, capital expenditures, future restructuring, plans or intentions relating to expansi
Slide 3: Introductions
Introductions Bruce Hoechner Mike Ludwig Bob Daigle President & Senior Vice President & Senior Vice President & Chief Executive Officer Chief Financial Officer Chief Technology Officer 3
Slide 4: Q3 2020 Overview
Q3 2020 Overview Financials Revenue by Market Segment - YTD • Net sales of $202M, increased 5.6% QoQ Advanced Advanced Results Mobility Wireless Connectivity • Gross margin of 37.4%, increased 80 basis points QoQ 24% ADAS 24% Infrastructure • Adjusted EPS* of $1.45, increased 28% QoQ e-Mobility 7% 1
Slide 5: Market Outlook
Market Outlook • EV/HEV: Global demand expected to grow at >35% CAGR and Advanced Mobility exceed 40M units annually by 20251 • ADAS: Market expected to grow at a 15-20% CAGR to 20252 • Portable Electronics: 5G smartphones expected to grow at a 35% Advanced Connectivity CAGR to 2025 and total market
Slide 6: Advanced Mobility: Rogers' Product Portfolio
Advanced Mobility: Rogers’ Product Portfolio ACS EMS Ceramic Substrates for Power Battery Compression Pads Semiconductor Packaging Anti-Vibration Pads PES Battery Pack Sealing Solutions 24/77GHz Corner Radar Specific to Short/Medium Range EV/HEV Inverter Converter Battery 77GHz Radar Long/Medium Ran
Slide 7: Strategic Priorities
Strategic Priorities Operational Excellence at Rogers Market-Driven Organization • Company-wide continuous improvement focus • Standardized and scalable operating approach that utilizes lean manufacturing to drive improved safety, Innovation Leadership quality, cost and flexibility • Global business
Slide 8: Financial Overview
Financial Overview Mike Ludwig, Sr. Vice President and Chief Financial Officer
Slide 9: Q3 2020 Financial Highlights
Q3 2020 Financial Highlights ($ in millions, except EPS) Q3-2020 Q2-2020 Q3-2019 Net sales $201.9 $191.2 $221.8 Gross margin $75.5 $70.0 $78.9 Gross margin % 37.4% 36.6% 35.6% Operating income $8.8 $21.1 $29.9 Operating margin % 4.4% 11.0% 13.5% Adjusted operating income* $35.0 $29.5 $36.2 Adjusted
Slide 10: Revenue Results
Revenue Results Consolidated Revenue Revenue by Business Unit* +4.2% +1.4% +5.6% $2.7 $8.0 +20.7% ($ in millions) ($ in millions) $201.9 $86.4 -10.2% $191.2 $71.6 $70.9 +6.0% $63.7 $45.2 $47.9 Q2'20 Volume Currency Q3'20 EMS EMS ACS ACS PES PES & Other* Q2'20 Q3'20 Q2'20 Q3'20 Q2'20 Q3'20 • Revenues
Slide 11: Gross Margin and Adjusted Net Income Results
Gross Margin and Adjusted Net Income* Results Gross Margin Adjusted Net Income* +3.9% (4.7%) +7.9% +7.6% +1.1% +26.0% (5.2%) +7.6% +28.4% $2.7 $3.3 $0.8 $75.5 ($ in millions) ($ in millions) $5.3 $1.1 $1.6 $70.0 $27.1 $5.5 $21.1 36.6% 37.4% 13.4% 11.0% Q2'20 Volume* Performance COVID-19 Tariffs Q3'2
Slide 12: Cash Utilization
Cash Utilization ($ in millions) Net cash provided by operating activities $113.7M Net cash used in investing activities ($28.9M) Net cash provided by financing activities ($67.0M) Effect of FX +$1.6M Net increase (decrease) in cash $19.3M $123.9 $25.9 $63.0 $28.9 $21.6 $4.3 $12.7 $166.8 $186.1 2019
Slide 13: Q4-2020 Guidance
Q4-2020 Guidance Net sales $195M - $210M Gross Margin 37.0% - 38.0% EPS $0.50 - $0.70 (Includes non-cash intangible amortization charge*) Adjusted EPS** $1.30 - $1.50 *Includes $11.7 million of accelerated intangible amortization expense associated with the DSP business **See reconciliation of adjus
Slide 14: Appendix
Appendix
Slide 15: Q3-2020: Adjusted operating margin reconciliation
Q3-2020: Adjusted operating margin reconciliation ($ in millions) Q3-19($) Q3-19(%) Q2-20($) Q2-20(%) Q3-20($) Q3-20(%) GAAP operating margin $29.9 13.5% $21.1 11.0% $8.8 4.4% Restructuring, severance, impairment and other related costs $1.3 0.6% $0.6 0.3% $10.7 5.3% Acquisition and related integrat
Slide 16: Q3-2020: Adjusted EBITDA and adjusted EBITDA margin reconciliation
Q3-2020: Adjusted EBITDA and adjusted EBITDA margin reconciliation ($ in millions) Q3-19($) Q3-19(%) Q2-20($) Q2-20(%) Q3-20($) Q3-20(%) GAAP net income $23.4 10.5% $14.5 7.6% $7.0 3.5% Interest expense, net $1.8 0.8% $1.8 0.9% $3.6 1.8% Income tax expense $5.3 2.4% $6.4 3.3% $0.6 0.3% Depreciation
Slide 17: Q3-2020: Adjusted EPS reconciliation
Q3-2020: Adjusted EPS reconciliation Q3-19 ($) Q2-20 ($) Q3-20 ($) GAAP earnings per diluted share $1.25 $0.78 $0.37 Restructuring, severance, impairment and other related costs $0.05 $0.02 $0.43 Acquisition and related integration costs $0.02 $0.02 $0.01 Environmental accrual adjustment - ($0.01) -
Slide 18: Q3-2020: Adjusted net income reconciliation
Q3-2020: Adjusted net income reconciliation ($ in millions) Q3-19 ($) Q3-19(%) Q2-20($) Q2-20(%) Q3-20($) Q3-20(%) GAAP Net Income $23.4 10.5% $14.5 7.6% $7.0 3.5% Restructuring, severance, impairment and other related costs $1.3 0.6% $0.6 0.3% $10.7 5.3% Acquisition and related integration costs $0
Slide 19: Q3-2020: Adjusted operating expenses reconciliation
Q3-2020: Adjusted operating expenses reconciliation* ($ in millions) Q3-19($) Q3-19(%) Q2-20($) Q2-20(%) Q3-20($) Q3-20(%) GAAP operating expenses $49.0 22.1% $48.9 25.6% $66.7 33.0% Restructuring, severance, impairment and other related costs ($1.3) (0.6%) ($0.6) (0.3%) ($10.7) (5.3%) Acquisition a
Slide 20: Q3-2020: Free cash flow reconciliation
Q3-2020: Free cash flow reconciliation* ($ in millions) Q3-19($) Q2-20($) Q3-20($) Net cash provided by operating activities $48.2 $46.3 $58.7 Non-acquisition capital expenditures ($14.8) ($7.0) ($10.8) Free cash flow $33.4 $39.3 $47.9 Note: dollars may not add due to rounding. *Free cash flow defin
Slide 21: Q4-2020: Guidance reconciliation
Q4-2020: Guidance reconciliation Q4-20 ($) GAAP earnings per diluted share $0.50 – $0.70 Discrete items $0.17 Acquisition intangible amortization $0.63 (includes non-cash intangible amortization charge*) Adjusted earnings per diluted share $1.30 - $1.50 Note: dollars may not add due to rounding. * I