Tredegar Corporation · NYSE:TG
Tredegar — Investor Presentation (November 2014)
35 slides from Tredegar's investor presentation, Nov 12, 2014
Slide 1: Investor Presentation November 2014
Exhibit 99.1 Investor Presentation November 2014
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements contained in this presentation are forward-looking statements. Pursuant to federal securities regulations, we have set forth cautionary statements relating to those forward-looking statements in our Annual Report on Form 10-K for the year ended December
Slide 3: Tredegar Corporation Business Profile
Tredegar Corporation Business Profile 1 1 Net Sales by Segment NetSales by Geography $916 million Net Sales 1 in LTM September 2014 Latin America North Film 11% America Aluminum Products 63% Extrusions 64% Asia 36% 12% Europe 14% 1 Net sales represent sales less freight. See Note 1 in GAAP to Non-GA
Slide 4: Tredegar Film Products Business Profile
Tredegar Film Products Business Profile ($590 million Net Sales 1 in LTM 2014) Customers Other 10% • Global and regional consumer care producers • Major manufacturers of flat panel display Surface components Protection • Major food packaging producers and converters 15% Personal Care Primary End Use
Slide 5: Bonnell Aluminum Business Profile
Bonnell Aluminum Business Profile (149 million pounds in LTM 2014) Customers • Glazing contractors and fabricators Other 8% Machinery Non - • Consumer durables, machinery and equipment, & Equip 7% residential and electrical OEMs B&C 60% Consumer • Tier I and II suppliers to automotive OEMs Durables
Slide 6: Translating Strategy into Action
Translating Strategy into Action Laying the Foundation for Long-term Growth Acquired Opened Pune, Terphane (flexible Significant packaging films) Acquired New India Plant Capacity AACOA Automotive New Flexible (personal care Expansion films) Projects Press Packaging Line Acquired Closed Kentland Div
Slide 7: Customer Concentration – Tredegar Net Sales
Tredegar Corporation Translating Strategy into Action 1 Customer Concentration – Tredegar Net Sales ($ in millions) 2010 2013 P&G 28% 38% 62% All Other 72% $720 $931 End-Market Concentration – Aluminum Extrusions Volume (lbs. millions) 2010 2013 Nonresidential Building & 30% Construction All Other 4
Slide 8: Well-positioned for future growth in attractive markets
Tredegar Corporation Translating Strategy into Action Well-positioned for future growth in attractive markets Leadership positions in diverse markets Investments in added capacity and capabilities are in place Strength of product innovation is driving additional value Opportunity for strong earnings
Slide 9: Key Market Drivers – Surface Protection Films
Tredegar Corporation Key Market Drivers Creating Growth Opportunities – Film Products Key Market Drivers for Surface Protection Films: New technologies for high-end TVs, tablets, phablets and smartphones are driving growth Expanded use of touch screen technology Screens getting larger; flat panel di
Slide 10: Key Market Drivers – Personal Care Films
Tredegar Corporation Key Market Drivers Creating Growth Opportunities – Film Products Key Market Drivers for Personal Care Films: Global growth for personal care products – 1 incremental volume 2014 through 2020 : 83 billion pads (3.9% CAGR) 50 billion diapers (4.5% CAGR) Over 700 million women aged
Slide 11: Key Market Drivers – Flexible Packaging
Tredegar Corporation Key Market Drivers Creating Growth Opportunities – Film Products Key Market Drivers for Flexible Packaging: Middle class consumption in emerging markets, including Brazil Growing end-user demand for convenience foods, lighter packaging and branded consumer products PET film offe
Slide 12: Key Market Drivers – Bonnell Aluminum
Tredegar Corporation Key Market Drivers Creating Growth Opportunities - Bonnell Aluminum Key Market Drivers for Nonresidential Construction, Industrial & Specialty Markets: Improving nonresidential building and construction market 5-6% annual industry growth projected 1 through 2018 Growth of indust
Slide 13: Key Market Drivers – Automotive Extrusions
Tredegar Corporation Key Market Drivers Creating Growth Opportunities Key Market Drivers for Automotive Extrusions: Cars being re-engineered to decrease weight and improve fuel efficiency – growing aluminum content in vehicles Limited qualified supply in place to meet demand Bonnell extrusions are s
Slide 14: Committed to Increasing Shareholder Value
Tredegar Corporation Committed to Increasing Shareholder Value Return on invested capital expected to be in the range of 11-12% by year-end 2016 from current rate of ~ 9% Dividend increases convey confidence in long-term financial outlook and cash flow generation With a balanced view towards capital
Slide 15: Well-positioned for future growth in attractive markets
Tredegar Corporation Translating Strategy into Action Well-positioned for future growth in attractive markets Leadership positions in diverse markets Investments in added capacity and capabilities are in place Strength of product innovation is driving additional value Opportunity for strong earnings
Slide 16: Appendix
Tredegar as) Appendix
Slide 17: Company Overview
Tredegar Corporation Company Overview Created in 1989: Ethyl Corp. (now NewMarket Corp.) spin-off Key Facts NYSE: TG Evolved from holding company to premier manufacturing Market Cap: $616MM operating company (as of Oct 31, 2014) HQ: Richmond, VA Superior manufacturing capabilities in plastic films a
Slide 18: Tredegar At A Glance
Tredegar At A Glance Major Products Primary End-Markets Customers Key Competitors Film Products Personal Care Materials: Apertured, Feminine hygiene products, baby diapers and adult incontinence products Global and regional consumer Clopay, Nordenia, Aplix, Pantex breathable, elastic and embossed fi
Slide 19: Film Products Annual Historical Financials
Tredegar Film Products Annual Historical Financials Volume (lbs. in millions) 270 270 300 2014 Performance Drivers: 250 219 206 200 185 Lower North American baby care 150 100 elastic laminate volume in 2014 (as 50 previously announced) 0 2011 2012 2013 3Q13 3Q14 Lower volume, pricing pressure and YT
Slide 20: Bonnell Aluminum Annual Historical Financials
Bonnell Aluminum Annual Historical Financials 2 Volume (lbs. in millions) 160 144 115 2014 Performance Drivers: 108 109 114 110 Volume up with growth in 60 nonresidential B&C, automotive and machinery & equipment 10 2011 2012 2013 3Q13 3Q14 Nonresidential B&C volume up 4% -40 YTD YTD year-to-date, c
Slide 21: Tredegar Annual Historical Financials
Tredegar Corporation Annual Historical Financials Net Sales 1 ($ in millions) 1200 2014 Performance Drivers: $857 $931 900 $776 $706 $692 Volume growth and favorable 600 product mix in Bonnell Aluminum 300 Near-term challenges in Film 0 Products 2011 2012 2013 3Q 13 3Q 14 YTD YTD Non-cash pension ex
Slide 22: Other 2014 Year-to-Date Financial Highlights
Tredegar Corporation Other 2014 Year-to-Date Financial Highlights $ in millions, except percentages Cash Flows from Operations $37.2 Capital Expenditures $32.6 Dividends Paid $8.1 Net Debt1 $86.9 Net Debt to Total Capitalization 2 17.3% Total Debt to Adjusted EBITDA 3 (LTM as of 9/30/2014) 1.43x ROI
Slide 23: Strong Cash Generation Profile
Tredegar Corporation Strong Cash Generation Profile ($ millions) 2010 2011 2012 2013 Cash Flows from Operations $46 $72 $83 $77 Capital Expenditures 20 16 33 80 1 Free Cash Flow 26 56 50 (3) Dividends 5 6 31 9 Acquisitions 6 181 58 0 Share Repurchases 35 0 0 0 1 Free cash flow represents cash flows
Slide 24: Cash Dividend History
Tredegar Corporation Cash Dividend History $1.20 $1.00 $.96 $0.80 $0.60 $.75 $0.40 $0.20 $.28 $.34 $.16 $.18 $.21 $0.00 1996-2010 2011 2012 1 2013 2014E 2 • Quarterly dividends have more than doubled since 2010. • A special dividend of $.75 per share was paid in 2012. 1 Includes special dividend of
Slide 25: Capital Expenditures History
Tredegar Corporation Capital Expenditures History ($ millions) 2014 2 Capital Expenditures 2010 2011 2012 2013 Projection Film Products 15.8 13.1 30.5 64.9 40.0 Bonnell Aluminum 4.3 2.7 2.3 14.7 8.0 Corporate 0.3 0.1 0.5 0.1 - Total 20.4 15.9 33.3 79.7 48.0 1 % Net Sales 2.8% 2.0% 3.9% 8.6% 2014 cap
Slide 26: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations
Slide 27: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Tredegar acquired Bright View Technologies Corporation on February 3, 2010, and its operations were incorporated into Film Products effective January 1, 2012. Prior year balances have been revised to conform with the current year presentation. Film Products results i
Slide 28: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Notes (continued): Film Aluminum 2013 Products Extrusions Total Operating profit (loss) from ongoing operations $ 71.0 $ 18.3 $ 89.3 Add back depreciation & amortization 35.3 9.2 44.5 Adjusted EBITDA before corporate overhead (a) 106.3 27.5 133.8 Corporate overhead -
Slide 29: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Notes (continued): Film Aluminum Products Extrusions Total 2010 Operating profit (loss) from ongoing operations $ 66.7 $ (4.2) $ 62.5 Add back depreciation & amortization 34.4 9.1 43.5 Adjusted EBITDA before corporate overhead (a) 101.1 4.9 106.0 Corporate overhead -
Slide 30: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Notes (continued): 3. The after-tax effects of losses associated with plant shutdowns, asset impairments and restructurings and gains or losses from the sale of assets and other items (which includes unrealized gains and losses for an investment accounted for under t
Slide 31: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Notes (continued): 4. Net debt is a non-GAAP financial measure that is not intended to represent debt as defined by GAAP, but is utilized by management in evaluating financial leverage and equity valuation. A calculation of net debt is showm below: (In millions) Sept
Slide 32: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Notes (continued): 6. Operating profit from ongoing operations is used by management to assess profitability. A reconciliation of operating profit from ongoing operations to net income is shown below: Operating profit (loss): YTD YTD LTM (in thousands) 2010 2011 2012
Slide 33: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Notes (continued): 7. Return on invested capital (ROIC) is defined by Tredegar as Adjusted Net Income from Ongoing Operations divided by average Invested Capital where the individual components are defined as follows: Adjusted Net Income from Ongoing Operations equal
Slide 34: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Notes (continued): 8. The pre-tax and after-tax effects of losses associated with plant shutdowns, asset impairments and restructurings and gains or losses from the sale of assets and other items (which includes unrealized gains and losses for an investment accounted
Slide 35: Investor Presentation November 2014
Investor Presentation November 2014