Cooper-standard Holdings Inc. · NYSE:CPS
Cooper-standard — Investor Day (October 2013)
46 slides from Cooper-standard's investor day presentation, Oct 30, 2013
Slide 1: Vision: Drive for Profitable Growth
<< VISION JriVe TOF Frontadie Growtn * Top 30 automotive suppliers for sales, . Cooper Standard Top 5% ROIC _ "PASSION FOR PERFORMANCE
Slide 2: Drive for Profitable Growth - Investor Day
DRIVE FOR PROFITABLE GROWTH Investor Day October 30, 2013
Slide 3: Today's Presentation
Today’s Presentation - Glenn Dong, Vice President and Treasurer - Jeff Edwards, Chairman and Chief Executive Officer - Keith Stephenson, Executive Vice President and Chief Operating Officer - Allen Campbell, Executive Vice President and Chief Financial Officer • Welcome and Introductions • Cooper St
Slide 4: Forward-Looking Statements
Forward-Looking Statements This presentation includes “forward-looking statements” within the meaning of U.S. federal securities laws, and we intend that such forward-looking statements be subject to the safe harbor created thereby. We make forward-looking statements in this presentation and may mak
Slide 5: Jeff Edwards, Chairman and Chief Executive Officer
Jeff Edwards Chairman and Chief Executive Officer
Slide 6: Presenting Team and Regional Presidents
Allen Campbell Executive Vice President & CFO Presenting Team and Regional Presidents Keith Stephenson Executive Vice President & COO Song Min Lee President, Asia Pacific Fernando de Miguel President, Europe Bill Pumphrey President, North America Jeff Edwards Chairman and CEO
Slide 7: Corporate Vice Presidents in Attendance
Corporate Vice Presidents in Attendance Helen T Yantz Vice President & Corporate Controller Glenn Dong Vice President & Treasurer Sharon Wenzl Vice President, Corporate Communications Tim Hefferon Vice President & General Counsel
Slide 8: Company Snapshot
8 Company Snapshot Automotive News Does not include approximately $400 M in unconsolidated JV revenue Product Business Units: Sealing & Trim Fuel & Brake Delivery Fluid Transfer Thermal & Emissions Anti-Vibration Headquarters: Novi, MI Established: Employees: 22,000 Global Suppliers: Rank 69 Global
Slide 9: Cooper Standard's Journey
9 2004 Divestment 2005 – 2008 Expansion 2008 – 2011 Survival 2011 - 2013 Recovery 2014 and Beyond Growth Cooper Standard’s Journey Divested from Cooper Tire & Rubber Company SEC Registrant
Slide 10: Cooper Standard's Journey: Expansion
2004 Divestment 2005 – 2008 Expansion 2008 – 2011 Survival 2011 - 2013 Recovery 2014 and Beyond Growth Cooper Standard’s Journey Strategic Acquisitions: • Metzeler Automotive Profiles - Sealing • ITT - Fluid Handling • ACH - Fuel Rail • Gates Corp. Automotive - Fluid Transfer Systems
Slide 11: Cooper Standard's Journey: Survival
2004 Divestment 2005 – 2008 Expansion 2008 – 2011 Survival 2011 - 2013 Recovery 2014 and Beyond Growth Cooper Standard’s Journey Global economic / auto industry downturn Managed for near-term Downsized engineering & overhead Tempered capital spending Restructured debt
Slide 12: Cooper Standard's Journey: Recovery
2004 Divestment 2005 – 2008 Expansion 2008 – 2011 Survival 2011 - 2013 Recovery 2014 and Beyond Growth Cooper Standard’s Journey Rebuilding capabilities and adding management talent Expanding in Romania, Brazil, India and Thailand Entering Serbia and Restructuring European Footprint Rebuilding and r
Slide 13: Cooper Standard's Journey: Growth
2004 Divestment 2005 – 2008 Expansion 2008 – 2011 Survival 2011 - 2013 Recovery 2014 and Beyond Growth Cooper Standard’s Journey Focusing business for profitable growth Tripling our investment in innovation Creating world-class manufacturing operations Growing Asia and other expanding markets Doubli
Slide 14: Extensive Product Portfolio
Sealing & Trim Systems 17%* Fuel & Brake Delivery Systems 11%* Fluid Transfer Systems 5%* Extensive Product Portfolio *Global Market Share Booz & Company Static Systems Glass Run Channels Waist belts Encapsulation Day Light Systems Dynamic Systems On Body Seals On Door Seals Convertible Occupant Det
Slide 15: Revenue is Growing
$1,945.3 $2,414.1 $2,853.5 $2,880.9 $3,050 – $3,075 Revenue is Growing Global Sales $98.3 $282.3 $312.2 $409.7 $435 – $450 Non-Consolidated JVs CS Sales E $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000
Slide 16: Sales are Diversifying
37% 22% 16% 5% 24% 18% 12% 4% Sales are Diversifying includes non-consolidated JV sales Sales Sales Ford GM Chrysler 3% 10% 7% 6% 13% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Slide 17: Global Automotive Industry Growth
Global Automotive Industry Growth Source: IHS Global volume to exceed 105 million vehicles by • China: greatest global growth from 2015 – 2020; positioned to be #1 light vehicle market +30 million vehicles • India: poised to produce more than 5 million vehicles by 2020 • Continued strong growth of o
Slide 18: Products on Top Selling Global Platforms
Cooper Standard Products are Consistently on the Top Selling Global Platforms Cooper Standard Products Well Represented on Global Platforms 2013 #6 GM Tahoe/Yukon/ Escalade #2 Ford Explorer #19 Ford Fusion/Mondeo/MKZ #1 Ford F-150 #5 GM LaCrosse / Malibu #8 Chrysler 200 Mid - Size CUV #16 Chrysler D
Slide 19: The Cooper Standard Vision
Drive for Profitable Growth Top 30 - Top 5 * Sealing & Trim Systems Fluid Transfer Systems Fuel & Brake Systems 2020E 2020E 2020E % represents compound annual growth rate The Cooper Standard Vision Growth platforms 2012-2020: *Non-consolidated sales $1.8B $0.4B $0.6B >10%
Slide 20: Avenues for Profitable Growth
Avenues for Profitable Growth Cooper Standard is Aligned with and Well-Positioned to Capitalize on Industry Trends 2. Long-term Growth in Emerging Markets 4. Trend Toward Global Platforms 3. North America and Europe Market Recovery 1. Capture China Growth 5. Innovation 6. Capture Strategic M&A Oppor
Slide 21: Keith Stephenson, Executive Vice President and COO
Keith Stephenson Executive Vice President and Chief Operating Officer
Slide 22: Long-term Growth in Emerging Markets
Brazil India China Avenues for Profitable Growth: Long-term Growth in Emerging Markets Production (million) Source: September 2013 IHS volumes 3.2 3.9 4.6 CAGR: 4.0% 3.2 4.5 6.7 CAGR: 7.7% 30.0 14.7 24.2 CAGR: 7.4%
Slide 23: North America and Europe Market Recovery
North America Europe Avenues for Profitable Growth: North America and Europe Market Recovery Production (million) Source: September 2013 IHS volumes 11.9 17.4 18.2 CAGR: 4.3% 19.0 20.4 23.2 CAGR: 1.9%
Slide 24: Global Footprint Evolution
Global Footprint Evolution
Slide 25: Global Footprint Evolution
Asia Europe Americas Global Footprint Evolution Expansion • Opened two new plants in Brazil • Added two plants in NA via acquisition • Launching new JV plant in Mexico Consolidation • Closed Bowling Green, OH plant Expansion • Established plant in Romania • Expanded Poland facilities • Opening Serbi
Slide 26: New Technology and Product Development
• Industry leading line-up of sealing products – Alternative materials for weight reduction and recyclability • Value added trim, encapsulation and SafeSeal™ technology – Enhanced appearance, safety and increased content per vehicle • Complete range of fluid transfer systems Introduction of alternat
Slide 27: Unique Innovation Process is a Key Differentiator
Cooper Standard’s Unique Innovation Process is a Key Differentiator Innovation is a Core Capability: – Internal and external idea generation – Detailed gate review designed for “Fast-to-Fail / Fast-to-Win” – Formal go-to-market plans Avenues for Profitable Growth: New Technology and Product Developm
Slide 28: M&A Process Tied to Company Strategy
M&A Process Tied to Company Strategy Avenues for Profitable Growth: Disciplined M&A Strategy Drives In-Organic Growth • Demonstrated competency with integrating into Cooper Standard and realizing synergies • Constantly identifying and evaluating opportunities to accelerate strategy
Slide 29: Building Worldwide Capabilities
Program Management Product Engineering Innovation Management Purchasing IT Systems Best Business Practices Building Worldwide Capabilities Global launch process Standardizing product specifications / launching low cost engineering center Developing “skip generation” technology Effectively leveraging
Slide 30: Allen Campbell, Executive Vice President and CFO
Allen Campbell Executive Vice President and Chief Financial Officer
Slide 31: Global Light Vehicle Sales Outlook
81.9 106.7 Source: IHS AutoInsight Global Light Vehicle Sales Outlook By Region Others BRIC Japan/ Korea Western Europe US 15.6 million in 2020 16.7 million in 2020
Slide 32: Market Dynamics
Market Dynamics Prospects for North American Output Source: IHS Automotive Light Vehicle Production Forecast 11 years 15.8 17.2 15.1 8.6 15.4 5 years Others German 3 Asian 4 Fiat Ford GM
Slide 33: Year-to-Date 2013 Performance
Year-to-Date 2013 Performance Note: Numbers subject to rounding $ USD Millions, except EPS / % Year-to-Date Sales $2,183.8 $2,296.3 Gross Profit 339.2 367.6 % Margin 15.5% 16.0% SGA 206.4 220.8 Operating Profit 105.4 127.5 % Margin 4.8% 5.6% Net Income $ 110.3 $ 66.3 Adjusted EBITDA 227.1 228.7 % Ma
Slide 34: Year-to-Date 2013 Revenue Up 5.2%
Year-to-Date 2013 Revenue Up 5.2 % $ USD Millions Note: Numbers subject to rounding $302 $335 $132 $146 $170 $189 Unconsolidated JV Revenue $2,184 $1,139 $781 $107 $156 $2,296 $1,192 $806 $139 $160 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 Consolidated North America Europe South America Asia Pacifi
Slide 35: Liquidity
Liquidity ($ USD Millions) Cash Flow and Liquidity as of September 30, 2013 Cash Balance as of Sep 30, 2013 ABL Revolver Letters of Credit Total Liquidity Note: Numbers subject to rounding $ 119.2 150.0 (26.4) $ 242.8
Slide 36: Capital Structure
Capital Structure as of September 30, 2013 (1) Before OID and underwriting fees Cash & equivalents $119.2 Total Debt Capital leases & other 33.0 Revolving Credit Facility - Total Secured Debt 33.0 Senior Unsecured Notes 450.0 Holdco PIK Toggle Notes (1) 200.0 Total Debt 683.0 Convertible Preferred S
Slide 37: 2013 Guidance
Capital Expenditures Cash Restructuring Cash Taxes Revenues 2013 Guidance Key Assumptions: North American production 16.2 million Europe (including Russia) production 19.0 million Average full year exchange rate $1.32/Euro $ 3,050 - $3,075 $ USD Millions $ USD Millions $ USD Millions $ USD Millions
Slide 38: Investment Highlights
Drive for Profitable Growth Top 30 - Top 5 Investment Highlights NYSE: CPS Advantaged global footprint and strong track record of operating performance Free cash flow supports investment in expansion, innovation, M&A Long-standing customer relationships Significant growth available by product, custo
Slide 39: Passion for Performance
‘G, PASSION FOR PERFORMANCE
Slide 40: EBITDA and Adjusted EBITDA Reconciliation
EBITDA and Adjusted EBITDA Reconciliation – Net Loss $(356.1) Income tax benefit (55.7) EBITDA $(233.7) Restructuring 32.4 Adjusted EBITDA $ 176.5 Interest expense, net of interest income 64.3 Depreciation and amortization 113.8 Bond repurchase (9.1) Foreign exchange gains (4.0) Reorganization / Fre
Slide 41: EBITDA and Adjusted EBITDA Reconciliation
EBITDA and Adjusted EBITDA Reconciliation – and Net income $ 320.3 $ 102.8 Income tax expense 45.0 EBITDA $ 537.2 $ 288.2 Restructuring 6.4 32.3 Adjusted EBITDA $ 276.5 $ 324.1 20.8 Interest expense, net of interest income 69.5 40.5 Depreciation and amortization 102.4 124.1 Stock based compensation
Slide 42: EBITDA and Adjusted EBITDA Reconciliation
EBITDA and Adjusted EBITDA Reconciliation – ($ USD Millions) (1) Includes cash and non-cash restructuring. (2) (3) Non-cash stock amortization expense and non-cash stock option expense for grants issued at emergence from bankruptcy. (4) Impairment charges related to goodwill ($2.8 million) and fixed
Slide 43: Net Leverage Ratio and Adj. EBITDA % Margin
Net Leverage Ratio and Adj. EBITDA % Margin as of September 30, 2013 ($ USD Millions) (1) Includes noncash restructuring. (2) Proportionate share of restructuring costs related to Cooper Standard France joint venture. (3) Non-cash stock amortization expense and non-cash stock option expense for gran
Slide 44: LTM EBITDA and Adjusted EBITDA Reconciliation
LTM EBITDA and Adjusted EBITDA Reconciliation as of September 30, 2012 Note: Numbers subject to rounding (1) Includes cash and noncash restructuring. (2) Proportionate share of restructuring costs related to Cooper Standard France joint venture. (3) Non-cash stock amortization expense and non-cash s
Slide 45: EBITDA and Adjusted EBITDA - Nine Months Ended September 30, 2013
EBITDA and Adjusted EBITDA – Nine Months Ended September 30, 2013 Note: Numbers subject to rounding (1) Includes noncash restructuring. (2) Proportionate share of restructuring costs related to Cooper Standard France joint venture. (3) Non-cash stock amortization expense and non-cash stock option ex
Slide 46: EBITDA and Adjusted EBITDA - Nine Months Ended September 30, 2012
EBITDA and Adjusted EBITDA – Nine Months Ended September 30, 2012 Note: Numbers subject to rounding (1) Includes cash and noncash restructuring. (2) Proportionate share of restructuring costs related to Cooper Standard France joint venture. (3) Non-cash stock amortization expense and non-cash stock
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