Slide 1: Earnings Forecast Conference Call
Earnings Forecast Conference Call December 20, 2002
Slide 2: Safe Harbor Language
Safe Harbor Language » Note: Certain statements and information included in this presentation are "forward-looking statements" under the Federal Private Securities Litigation Reform Act of 1995. Accordingly, we advise that these forward-looking statements be evaluated with consideration given to the
Slide 3: Agenda
» 4th Quarter Update » Building Upon Successes » 2003 Business Plan Themes & Key Assumptions » 2003 Business Plan >» Wrap-up / Take-aways » Questions >» Closing
Slide 4: Fourth Quarter Update
Fourth Quarter Update » Previously announced 4Q management EPS estimate was $0.48 - $0.52 — We are are currently forecasting to be at the low end of the estimate, which includes a $0.07 charge for severance in conjunction with cost streamlining actions in the Supply Chain Services business segment a
Slide 5: Agenda
» 4th Quarter Update » Building Upon Successes » 2003 Business Plan Themes & Key Assumptions » 2003 Business Plan >» Wrap-up / Take-aways » Questions >» Closing
Slide 6: Building on Successes and Creating Opportunities
Building on Successes and Creating Opportuni Bo ct 2000 mugowoa Building the Foundation B
Slide 7: Building on Successes and Creating Opportunities
Bo ct mugowoa Building on Successes and Creating Opportunities Cost and Business Process Improvement initiatives Delivered Forecasted Earnings in Depressed Economy Bringing Transformation 2001 | to the Bottom Line © Operating costs reduced $113M Building the Foundation -
Slide 8: Cost Management & Improvement
Bo ct mugowoa Building on Successes and Cost Management & Creating Opportunities s Improvement Bringing Transformation 2001 | to the Bottom Line © Operating costs reduced $113M Cost and Business Process Improvement initiatives Delivered Forecasted Earnings in Depressed Economy Building the Foundatio
Slide 9: Continuous Improvement
Bo ct mugowoa Building on Successes and Creating Opportunities Achieving Long-Term, Deliver a Cost Competitive 2003 & | Sustainable Profitable Growth Solution Set Which Creates © Operating cost reduction target $44-$49M Value for our Stakeholders st Management & Continuous Improvement Cost and Busin
Slide 10: Agenda
» 4th Quarter Update » Building Upon Successes » 2003 Business Plan Themes & Key Assumptions » 2003 Business Plan >» Wrap-up / Take-aways » Questions >» Closing
Slide 11: Plan Themes
Plan Themes Providing evidence that a stronger Ryder is being built to optimize performance when the economy turns » Bridge the gap caused by an estimated $56 million increase in 2003 pension expense and the impact of a prolonged soft economy » Continued emphasis on prudent capital allocation and a
Slide 12: Soft economy forecast into 2003
» We continue to forecast a soft economy into 2003; with customers slow to commit to large capital expenditures and long-term leases » Overall revenue growth is planned to be flat with 2002 projection with growth anticipated in the rental product line and in European operations » Earnings growth ste
Slide 13: Key Assumptions
Key Assumptions » Fleet Management Solutions/Dedicated Contract Carriage: — Soft lease market in 2002/03 results in minimal lease revenue growth for 2003 — Improvement in rental demand slightly above GDP growth, with increasing margins due to asset management initiatives — Used vehicle market improv
Slide 14: Agenda
» 4th Quarter Update » Building Upon Successes » 2003 Business Plan Themes & Key Assumptions » 2003 Business Plan >» Wrap-up / Take-aways » Questions >» Closing
Slide 15: Key Financial Statistics
Key Financial Statistics (8 Millions, Except Per Share Amounts) 2003 2002 Plan Projection % B/ QW) Revenue $ 4,758 769. 0% Pretax Eamings Before Unusual Items $ 192-197 17 8% - 11% (Restructuring) / Recovery Items - 6) NM Total Pretax Earnings”) 192 - 197 172 12% - 15% EPS Before Unusual Items $ 1,9
Slide 16: EPS by Quarter
EPS by Quarter (S Earnings Per Share) Full ist Qtr 2nd tr 3rd Qtr 4th Qtr Year 2003 Plan EPS 026-027 064-055 068-060 057-088 195-2.00 2002 Proj. EPS"? 0.27 047 0.54 0.48 176 (1) Excludes goodwall charge of $0.30 due to change in accounting principle. Includes restructuringtecovery charges of $0.05.
Slide 17: Earnings Per Share
(8 Earnings Per Share) nwo —_$195-520 “Excludes $0.30 goodwill charge associated with change in accounting principle. 47
Slide 18: Key Initiatives
Key Initiatives Continuing to build the long-term foundation of a stronger Ryder through continuous improvement processes apatener or sceuttoraeren overran one $ 44-49 million ent captor word 2003 oe Initiatives fot ansuranee ne nner
Slide 19: Business Segment
Business Segment Full Year (3 Millions) 2003 Plan _2002 Proj. _‘%* BAW) Revenue: Fleet Management Solutions $ 3,290 3,184 3% Supply Chain Solutions 1,279 1,386 @)% Dedicated Contract Carriage 522 57 1% Eliminations 333) G18) Om Total revenue 478 3 Oh Segment NBT Fleet Management Solutions ‘Supply Ch
Slide 20: Business Segment Operating Margin
Ryder Business Segment — Operating Margin Business segment margin percent of revenue excluding the impact of pension expense/income FMS. © 2003 Plan Dcc 012002 Proj. m 2001 scs 2000 5.0% 0.0% 5.0% 10.0% Optimizing core earnings grewth through focused cost management and process improvement initiativ
Slide 21: Financial Indicators
Financial Indicators Free Cash Fiow\($ Millions) Capital Expenditures* ($ Millions) 600 ia = 400 + 200 + te ta 20m | su | sore 00 | ce tm eon | = sume G09 | p00) onal Akal foal otal Prete PE if ss ose mmm mm am ee ee ey ‘eccuangacquittont Debt to Equity Ratio 350%: ‘Total Obligations 300%. Including
Slide 22: Liquidity
» Ryder’s short-term debt is at historic low levels. Liquidity Strong debt capacity exists to support increased capital expenditures and growth. Vv 1 $ Million: 400 200 Including Uncommitted Facilities ($4,173MM) Committed Global Credit Facility ($860MM) 33101 630/01 98001 1gnqo1 = 3302 ——«G/0/02 Ou
Slide 23: Access to Capital
Access to Capital » Ryder continues to have broad access to the debt capital markets Recently Utilized Short Term US. Commercial Paper v Conduit Commercial Paper v International Revolving Credit Facilities v Long Term Medium Term Notes - U.S. v Underwritten Bonds -U.S. Operating Leases Lease Securit
Slide 24: Pension Expense Update
ension Expense Update » Pension expense increase of approximately $56M expected in 2003 due to market conditions — Final expense based on portfolio performance through 12/31/02 and corporate bond rates used to derive discount rate in liability calculation » No U.S. cash contribution required in 2003
Slide 25: Agenda
» 4th Quarter Update » Building Upon Successes » 2003 Business Plan Themes & Key Assumptions » Business Plan >» Wrap-up / Take-aways » Questions >» Closing
Slide 26: Wrap-up / Take-aways
Continued weakness in economy in 2003 with prospects for modest improvement in second half Increased pension expense creating earnings challenge Fevers and build on strategic process improvements made throughout organization to achieve results Enhance focus on cost competitiveness particularly in Su
Slide 27: Agenda
» 4th Quarter Update » Building Upon Successes » 2003 Business Plan Themes & Key Assumptions » Business Plan >» Wrap-up / Take-aways >» Questions >» Closing
Slide 28: Closing
» 4th Quarter Update » Building Upon Successes » 2003 Business Plan Themes & Key Assumptions » Business Plan >» Wrap-up / Take-aways » Questions » Closing
Slide 29: Ryder
Cityder