Blue Bird Corporation · NASDAQ:BLBD
Blue Bird — Investor Presentation (May 2023)
34 slides from Blue Bird's investor presentation, May 2023
Slide 1: A Leader in zero- and low-emission transportation
“A Leader in zero- and low-emission transportation” BLUE BIRD CORPORATION (NASDAQ: BLBD) Investor Presentation May 2023
Slide 2: Important Disclaimers: Forward Looking Statements
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 3: Important Disclaimers: Non-GAAP Financial Measures
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 4: Agenda
Agenda Investment Highlights School Bus Industry Overview Company & Product Highlights FY2023 Objectives Growth Runway 4
Slide 5: Investment Highlights
Investment Highlights Well positioned for growth given the backdrop of an aging school bus fleet Primed to be a direct beneficiary of $5B of infrastructure US Government’s commitment to electrification of school buses Leading market position in alternative power with a scaling EV business and an exp
Slide 6: School Bus Industry Overview
School Bus Industry Overview 6
Slide 7: Industry Highlights
Industry Highlights OEMs School Bus Customers Lion ~3,400 Contractors 500k+ Thomas Blue Bird ~10,000 School Districts IC High barriers to entry Highly specialized product -- Complex state and customer requirements -- Dealer and service network -- Customer relationship driven business Demand Drivers
Slide 8: Type C & D School Bus Industry
Type C & D School Bus Industry Mean: 31,000 Historical Registrations Long Term Avg. ('85-'19) ▪ Industry avg size (pre-COVID) is 31,000 new units annually based on Polk registrations ▪ Total fleet of school buses is ~515,000 units and average age is about 10 years ▪ Industry size is driven by: ▪ Num
Slide 9: Fleet Age Profile Supports Industry Levels
Fleet Age Profile Supports Industry Levels ~515K School Buses on the Road as of the end of CY2022 40,000 43%+ of the fleet is 35,000 10 years and older 30,000 25,000 20,000 15,000 10,000 5,000 - 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 ~221K bus
Slide 10: Company & Product Highlights
Company & Product Highlights 10
Slide 11: Introduction to Blue Bird
Introduction to Blue Bird ▪ Headquartered in Macon, Georgia Dedicated Manufacturing Micro Bird JV Facility ▪ Leader in alternative power; #1 in electric & propane school buses (Drummondville, Quebec, Canada) ▪ ~60% of Blue Bird sales are non-diesel; <10-20% for competitors Footprint Parts Distributi
Slide 12: Proven Leadership in Clean Technologies
Proven Leadership in Clean Technologies 14000 70% Diesel Gas Propane CNG Electric Alt-Power mix ▪ Proven track record of leadership in 12000 60% new technologies; more than 50% of 11,649 11,317 11,017 unit sales are non- diesel 10,616 58% 10,378 10000 9,064 48% 48% 50% ▪ Leader in electric and propa
Slide 13: EPA Clean School Bus Rebate Program
EPA Clean School Bus Rebate Program Program Overview 2022 Lottery Results $5B funding over 5 years Blue Bird Corporate and Dealers Other OEMs ~300 Loyal BB Customers and ~$1B released in 2022 690 200- Channel Partners 400 2,468 Buses awarded at 391 School Districts ~1,200 Unallocated winnings Short-
Slide 14: EPA Clean School Bus Grant Program - Phase II
EPA Clean School Bus Grant Program - Phase II Phase II - $400M Competitive Grant Program Timeline Application period Anticipated Selection Anticipated Orders May – Aug 2023 Nov 2023 – Jan 2024 Jan – Mar 2024 • Extensive project narrative • Scored based on evaluation criteria • School district applic
Slide 15: Build Complete Ecosystem for EV School Bus Deployment
Build Complete Ecosystem for EV School Bus Deployment END OF LIFE ASSESSMENT Determine recycling program for Determine what bus best fits the used batteries after use customer’s needs based on terrain, climate and route planning SERVICE & SUPPORT FINANCING Connect with dealer and EV system Identify
Slide 16: FY2023 Objectives
FY2023 Objectives 16
Slide 17: FY2023 Objectives & Focus Areas
FY2023 Objectives & Focus Areas Our People Lean Transformation Expanding Our TAM Scaling EV 17
Slide 18: FY2023 Focus Areas
FY2023 Focus Areas Focus Area Completed Future Levers ✓ Leadership team transformation completed o Continuing upgrades in the manufacturing facility ✓ Rolled out a comprehensive employee engagement plan to Our People improve employee satisfaction ✓ Improving the span of control and accountability in
Slide 19: Legacy backlog units behind us, FY23-H2 back to normal margins
Legacy backlog units behind us, FY23-H2 back to normal margins Status 04/01/23 Production Quarter 15% FY23 Orders to go 28% 31% FY23 Backlog (20-25% pricing) FY22 Newer Backlog (11-15% pricing) 64% FY21 Old Backlog (0-5% pricing) 74% 80% 100% 100% 57% 80% FY2024 Model Year 72% price increase 26% 36%
Slide 20: Key Success Factors Already in Place for FY2023-H2
Key Success Factors Already in Place for FY2023-H2 Rev. $235 $300 $275 - $300 $275 - $300 $1,085 - $1,135 $M 1 ✓ Q2 guidance exceeded; Record Q2 Revenues and EBITDA Adj. EBITDA ✓ Raising Revenues and EBITDA guidance for FY23 60 ✓ Fiscal Year production sold out (only some EV slots kept open) 55 - 65
Slide 21: FY2023 Guidance Raised: Strong profitability in FY2023
FY2023 Guidance Raised: Strong profitability in FY2023 FY2022 FY2023 FY2023 FY2023 B/(W) $ Millions Actuals Initial Dec. Feb. Updated May Updated Vs. Prior Year Guidance Guidance Guidance Net Revenue $800 $900 – $1,000 $1,000 - $1,050 $1,085 - $1,135 $285 - $335 Adj. EBITDA1 $(15) $35 - $45 $40 - $4
Slide 22: Positioned for Strong Recovery in FY2023 & Beyond
Positioned for Strong Recovery in FY2023 & Beyond 45,000 NA School Bus Industry Bookings 22%+ = 8,350+ units Class 6-7* 39.6k 40,000 38.7k 36.8k 36.6k 35.8k 36.1k 35,000 32.6k Revenue 37%+ = ~$1.1 Billion 29.6k 29.5k 30,000 26.4k 25.7k 25,000 Parts Revenue 15%+ = $88+ Million 20,000 ~10% CAGR 15,000
Slide 23: Solid Growth Runway
Solid Growth Runway 23
Slide 24: Long-term Outlook Driven by EV growth and Lean Transformation
Long-term Outlook Driven by EV growth and Lean Transformation Units Revenues $M Diesel Gas Propane CNG EV Outlook Rev. $M 11,646 12,000 12,000 11,317 11,017 11,000 3,000 10,500 10,000 8,878 9,500 2,500 8,350 2,000 8,000 6,679 6,822 1,750 2,000 6,000 1,500 1,500 1,100 1,250 4,000 1,019 879 1,000 991
Slide 25: Strong Outlook Ahead for Blue Bird / Investment Highlights
Strong Outlook Ahead for Blue Bird / Investment Highlights Countercyclical Strong industry growth ahead with a backdrop of healthy funding and an aging school bus fleet National Commitment Beneficiary of $5B US Government’s commitment to the electrification of school buses The Leader Leading market
Slide 26: Appendix
Appendix 26
Slide 27: Q2 Income Statement
Q2 Income Statement ($ Millions) FY2023 FY2022 B/(W) Unit Volume 2,304 1,931 373 Unit Backlog 5,783 6,607 (824) Net Revenue $299.8 $207.7 $92.1 Bus Rev./Unit ($000's) $118.7 $97.6 $21.1 Gross Margin 11.9% 1.5% 10.4 pts. Adj. Net Income1 $8.6 $(10.1) $18.7 Adj. EBITDA1 $19.8 $(10.7) $30.5 Adj. EBITDA
Slide 28: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow ($ Millions) FY2023-Q2 FY2022-Q2 B/(W) Cash $17.8 $14.9 $2.9 Debt $(139.6) $(156.9) $17.3 Liquidity1 $101.5 $108.6 $(7.1) Operating Cash Flow $22.5 $21.7 $0.8 Adj. Free Cash Flow2 $23.4 $21.6 $1.8 Trade Working Capital* $4.7 $31.2 $(26.5) Strong Free Cash-Flow for FY23-Q2
Slide 29: FY2022 Q2 to FY2023 Q2 Adj. EBITDA Walk
FY2022 Q2 to FY2023 Q2 Adj. EBITDA Walk ($ Millions) Q2 Unit Volume FY2022 1,931 +30.5 FY2023 2,304 5.4 Delta +373 19.8 3.8 (2.0) 23.3 7% of Net Rev. (5)% of Net Rev. (10.7) FY22-Q2 Bus Vol., Bus Parts Gross OPEX/Other FY23-Q2 Adj. EBITDA Price-Mat. Operations Profit Adj. EBITDA Significant improvem
Slide 30: After dropping over the last year, steel prices are back up in Q1-2023
After dropping over the last year, steel prices are back up in Q1-2023 US Steel Spot Prices, USD/ST, Jan ‘21– Apr ‘23 HR CR Scrap 4/21 4/28 2,500 2,000 1,870 1,500 1,370 1,471 1,000 1,163 500 679 487 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan
Slide 31: Adj. EBITDA Reconciliation
Adj. EBITDA Reconciliation 31
Slide 32: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation 32
Slide 33: Adjusted EPS Reconciliation
Adjusted EPS Reconciliation 33
Slide 34: Investor Relations Contact Information
Investor Relations Contact Information Mark Benfield Mark.Benfield@Blue-Bird.com 34