Vishay Precision Group, Inc. · NYSE:VPG
Vishay Precision — Investor Presentation (May 2016)
20 slides from Vishay Precision's investor presentation, May 2016
Slide 1: Vishay Precision Group, Inc.
Vishay Precision Group, Inc. May 2016
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT From time to time, information provided by us, including but not limited to statements in this report, or other statements made by or on our behalf, may contain "forward-looking" information within the meaning of the Private Securities Litigation Reform Act of 1995. Such statem
Slide 3: Overview
OVERVIEW Global manufacturing footprint • A niche resistive sensor technology company providing components, sensors, and sensor-based solutions to multiple, growing markets. 2,500 • Approximately 2,300 employees. • Three reporting segments: Foil Technology Products, Force Sensors, Weighing and Contr
Slide 4: Foil Technology Products
FOIL TECHNOLOGY PRODUCTS Foil Resistors and Strain Gages Applications Applications High end test and measurement for the aviation, military Stress analysis gages for structural testing for the aviation, and space, semiconductor, process control, oil and gas military and space, infrastructure and con
Slide 5: Force Sensors
FORCE SENSORS OEM/Custom Applications Medical devices – hospital beds, medication dosing Agricultural equipment - precision force measurement Construction machinery - Aerial equipment for tipping and overload prevention Financial Highlights Market • Service available mkt. - $800M - diverse First Qua
Slide 6: Weighing and Control Systems
WEIGHING AND CONTROL SYSTEMS Process weighing systems On-board weighing Steel mill systems Applications Process weighing – chemicals, food, pharmaceuticals Aircraft and trucks – weighing and overload protection Steel and paper mills – weight, force and process optimization Offshore drilling – force
Slide 7: Market Overview
MARKET OVERVIEW Fiscal 2015 Revenue: $232.2M CUSTOMER TYPE END MARKET 25% GEOGRAPHY 7
Slide 8: Diversified Customer Base
DIVERSIFIED CUSTOMER BASE Distributors/EMS Aviation Medical Weighing Industrial 8
Slide 9: Strategy
VrG PERFORMANCE THROUGH PRECISION ORGANIC TOP-LINE GROWTH SCALABLE BUSINESS MODEL ACQUISITIONS MID-SINGLE DIGITS IN ga IMPROVED GLOBAL ECONOMIC ENVIRONMENT COST STRUCTURE TO LEVERAGE THE BENEFIT OF HIGHER VOLUMES TARGET: * ~$5-60M; >35% GROSS MARGIN + MID-TEENS IRR HURDLE RATE CCRETIVE WITHIN 12 MON
Slide 10: Key Macro Economic Conditions (2012-15)
KEY MACRO ECONOMIC CONDITIONS (2012-15) Head winds • Exchange rate (strong U.S. dollar versus other currencies). • European recession. • Low steel prices and production slow down. • Oil and gas prices drop. • China industrial slow down. • Precision agriculture and commodity prices drop. 10
Slide 11: Actions to Date: Strategic Initiatives
ACTIONS TO DATE Strategic initiatives • Foil Technology Products - new IP development and operational streamlining • New IP development of advanced sensor technology (product and process). • ERP implementation. • Foil resistor new product introduction. • On-going cost reduction (improve process cont
Slide 12: Actions to Date: Strategic Initiatives
ACTIONS TO DATE Strategic initiatives • Weighing and Controls Systems – new IP development, plus M&A. • Onboard weighing – truck /van weigh introduction (mainly for overload protection). • Acquisitions – KELK, Stress-Tek. • New instruments, projects for off-on shore applications. • Corporate • Effec
Slide 13: Actions to Date
ACTIONS TO DATE • Developed Advanced Sensor platform in 2011. • Revenues growing from $0.3M in 2011 to $5.0M in 2015. • Developed Onboard Weighing product platform. • Revenues growing from $0.7M in 2011 to $2.3M in 2015. Foreign currency impact plays a major role in revenue growth, as approximately
Slide 14: Foreign Currency Effect
FOREIGN CURRENCY EFFECT Dollars in thousands Consolidated Revenues 2012 vs 2013 vs 2014 vs 2015 vs 2011 2012 2013 2014 Change in net revenues $ (20,491) $ 20,973 $ 11,439 $ (17,850) Percentage change versus prior period -8.6% 9.6% 4.8% -7.1% Change attributable to: Change in volume -6.4% -3.8% 5.1%
Slide 15: Actions to Date: Cost Structure
ACTIONS TO DATE Cost structure in place to accelerate earnings growth • November 2015 – announced a global cost-reduction program. • Savings of approximately $6M pre-tax income. • Significant 2016 increase in net earnings and EPS. • Restructuring costs of approximately $4M – cash paid in 2015 and 20
Slide 16: Cash Generation
CASH GENERATION Dollars in millions Free Cash Flow 14.2 13.2 7.9 4.1 2012 2013 2014 2015 Cash flow generation was strong for the 2015 year, at $13.9 million, with free cash flow of $4.1 million.* *Free cash flow is defined as the amount of cash generated from operations ($13.9 million for the 2015 f
Slide 17: Actions to Date: Acquisitions
ACTIONS TO DATE • KELK (closed 2013) • Purchase price approximately $50M (CAD); 6X EBITDA. • Expanded our existing offerings to new geographies (Asia and Latin America). • Recognized worldwide leader in optical and roll-force measurement solutions in the steel industry. • Stress – Tek (closed 2015)
Slide 18: First Quarter 2016 Highlights
FIRST QUARTER 2016 HIGHLIGHTS • First quarter net revenues of $56.6 million. • FX impact to revenues - $1.2 million for the first quarter versus the prior year period. • First quarter adjusted diluted earnings per share of $0.13. • New products – advanced sensors’ revenue grew approximately 95% in t
Slide 19: Strategy Looking Forward
STRATEGY LOOKING FORWARD Value proposition (2016-18) Mid- to high-single digit sales growth Gross margin > 40% Adjusted operating margin > 10 % Strong cash generation continues Accelerated M&A activity 19
Slide 20: Thank You
PERFORMANCE THROUGH PRECISION THANK YOU
Vishay Precision Group — Investor Presentation (May 2016) on 6ix