Blue Bird Corporation · NASDAQ:BLBD
Blue Bird — Q3 2020 Earnings Presentation
24 slides from Blue Bird's earnings presentation, Aug 12, 2020
Slide 1: Fiscal 2020 Third Quarter Results
Blue Bird Corporation (Nasdaq: BLBD) Fiscal 2020 Third Quarter Results Earnings Conference Call August 12, 2020
Slide 2: Agenda
Agenda ▪ Introductions & Forward-Looking Statements – Mark Benfield – Executive Director, Profitability & Investor Relations ▪ Business Overview – Phil Horlock – President & CEO ▪ Financial Results – Jeff Taylor – CFO ▪ Priorities and Outlook – Phil Horlock – President & CEO ▪ Q&A – Group This prese
Slide 3: Business Overview
Phil Horlock President & CEO BUSINESS OVERVIEW 3
Slide 4: Dealing with Market Challenges; Business Structure Improving
Dealing with Market Challenges; Business Structure Improving Blue Bird ▪ 3Q was a challenging quarter, however business-structure improvement continued o Challenges: • School shutdown and shelter-in-place delayed orders from mid-March • Suspended production for two weeks in April due to COVID-19 • S
Slide 5: 3Q Results Overview
3Q Results Overview ▪ 3Q results significantly impacted by COVID-19 o 1,948 buses sold, down by 1,472 units versus last year o Total Net Sales of $189.2M, 38.7% lower than last year o Adjusted EBITDA of $12.5M, $16.6M below last year o Average-bus selling price was 9% higher than last year o Adjuste
Slide 6: Alternative-Fuel Leadership
Alternative-Fuel Leadership 1 FY2020 YTD Highlights 1 ▪ Alt-Fuel mix at 48%, equal to prior year ▪ ~64% market share fiscal year through June ▪ 291 new Alt-Fuel customers added ▪ 113 conquest customers added ▪ 160+ electric buses sold and in backlog Opportunities ▪ VW mitigation funds o 50 states ha
Slide 7: Profit and Cash Improvement Initiatives
Profit and Cash Improvement Initiatives EBITDA Improvement Cash Conservation ~$15M Annualized Saving ~$40M in Second Half of FY2020 CapEx Accounts Comp / Benefits / SG&A Single Shift Receivable Other Ongoing initiative to drive down cost and generate cash 7
Slide 8: Financial Results
Jeff Taylor CFO FINANCIAL RESULTS 8
Slide 9: 3Q Results – Summary
3Q Results – Summary ($ Millions unless noted) 3Q FY2020 3Q FY2019 B/(W) Unit Volume 1,948 3,420 (1,472) Net Revenue $189.2 $308.8 $(119.6) Bus Rev./Unit ($000's) $92.7 $85.4 $7.3 Gross Margin 11.1% 13.5% (240) bps. SG&A $17.8 $21.0 $3.2 Net Income $1.3 $14.6 $(13.3) Adj. Net Income1 $4.4 $18.3 $(14
Slide 10: 3Q FY2019 to FY2020 Adj. EBITDA Walk
3Q FY2019 to FY2020 Adj. EBITDA Walk ($ Millions) Lower 3Q profits driven by lower sales (1,472 units) and COVID-19 causing supplier disruptions and plant shutdown, partially offset by improved pricing and cost initiatives 1See appendix for additional detail regarding Adjusted EBITDA 10
Slide 11: 3Q Adj. Free Cash Flow
3Q Adj. Free Cash Flow 3Q ($ Millions) FY2020 FY2019 Adjusted EBITDA $ 12.5 $ 29.0 Cash Paid for Interest (Net) (1.8) (2.9) Trade Working Capital1 (39.3) (20.7) CAPEX (2.5) (7.4) Cash Taxes 2.0 (0.1) Other2 (1.2) 3.8 Adjusted Free Cash Flow $ (30.3) $ 1.7 Operational Transformation Initiatives (1.3)
Slide 12: Net Debt, Leverage & Liquidity
Net Debt, Leverage & Liquidity ($ Millions) As of July 4, 2020 Debt $221.4 Cash 12.5 Net Debt $208.8 Net Debt / Adjusted EBITDA 3.2x Net Leverage Ratio 3.3x Compared with minimum bank Net Leverage Ratio covenant of 3.75x Liquidity1 $102.5 1 Liquidity is defined as cash and cash equivalents plus avai
Slide 13: Priorities and Outlook
Phil Horlock President & CEO PRIORITIES AND OUTLOOK 13
Slide 14: Our Priorities Are Clear
Our Priorities Are Clear Pricing to Cost Structure Alternative Fuels Safety Practices Offset Economics Improvement Leadership ▪ Temp. scanning ▪ Focus on growing ▪ Continue to reduce ▪ 64% market share stations installed ASP; 9% increase costs through in 3Q20 Transformational ▪ #1 in: ▪ Regular clea
Slide 15: 4Q and Full Year Outlook
4Q and Full Year Outlook YTD 4Q FY2020 ($ Millions) Outlook Net Revenue $ 598 $250 - $275 $848 - $873 Adj. EBITDA $ 33 $16 - $20 $49 - $53 Adj. Free Cash Flow $ (82) $66 - $82 $(16) - $0 4Q unit sales projected to be more than 40% higher than 3Q 15
Slide 16: Outlook: Blue Bird Confident but Economy Uncertain
Outlook: Blue Bird Confident but Economy Uncertain ▪ Improving business structure – increased bus selling price, lowered cost and achieved a strong mix of alternative fueled-buses ▪ Single shift operation launched smoothly, improving cost, efficiencies and quality; daily capacity increase will be in
Slide 17: BLUE BIRD.
S BLUE BIRD.
Slide 18: Appendix
Appendix S BLUE BIRD.
Slide 19: Adj. EBITDA Reconciliation
Adj. EBITDA Reconciliation Reconciliation of Net Income to Adjusted EBITDA Three Months Ended Nine Months Ended (in thousands of dollars) July 4, 2020 June 29, 2019 July 4, 2020 June 29, 2019 Net Income $ 1,286 $ 14,601 $ 244 $ 12,708 Adjustments: Interest expense, net (1) 2,466 3,472 10,213 10,542
Slide 20: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation Reconciliation of Free Cash Flow to Adjusted Free Cash Flow Three Months Ended Nine Months Ended (in thousands of dollars) July 4, 2020 June 29, 2019 July 4, 2020 June 29, 2019 Net cash provided by operating activities $ (30,096) $ 7,659 $ (78,305) $ (19,113) Cash paid
Slide 21: Adjusted EPS Reconciliation
Adjusted EPS Reconciliation Reconciliation of Net Income to Adjusted Net Income Three Months Ended Nine Months Ended (in thousands of dollars) July 4, 2020 June 29, 2019 July 4, 2020 June 29, 2019 Net Income $ 1,286 $ 14,601 $ 244 $ 12,708 Adjustments, net of tax benefit or expense (1) Operational t
Slide 22: Important Disclaimers
Important Disclaimers Forward Looking Statements This presentation includes forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations for future financial performance,
Slide 23: Important Disclaimers
Important Disclaimers Non-GAAP Financial Measures This presentation may include the following non-GAAP financial measures: “Adjusted EBITDA,” "Adjusted EBITDA Margin," “Adjusted Net Income,” “Adjusted Diluted Earnings per Share,” “Free Cash Flow” and “Adjusted Free Cash Flow.” Adjusted EBITDA is def
Slide 24: END
S BLUE BIRD.