Slide 1: Fourth Quarter and Full Year 2018 Earnings Presentation
Fourth Quarter and Full Year 2018 Earnings Presentation February 28, 2019
Slide 2: Disclaimer
Disclaimer Forward‐Looking Statement Any "forward‐looking" statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, contained herein, including those relating to the Company’s business, financial condition or future results,
Slide 3: TriMas Overview
TriMas Overview Segments Brands Packaging Net Sales: $368.2M Op. Profit/Margin: $84.6M, 23.0% Amortization Exp.(4): $9.1M, 2.5% Net Sales by Segment Operating Profit(1) Aerospace Aerospace Aerospace Packaging 21% 19% 19% 42% 59% 86% 5% 57% 24% Specialty Packaging 22% 7% Products Net Sales: $185.9M 3
Slide 4: TriMas Strategy
TriMas Strategy TriMas unleashes value across our multi‐industry businesses through our strategy of... 1 2 Leveraging the Enhancing Long‐term TriMas Business Model Growth through to Drive Performance Innovation 4 3 Relentless Disciplined Approach to Commitment to Capital Allocation Cash Conversion 4
Slide 5: Q4 2018 Results
Q4 2018 Results Q4 Highlights • Achieved strong organic sales growth of 8.9% • Overall performance and commitment to continuous improvement more than offset the impact of higher material costs Net Sales Operating Profit EPS, diluted +8.3% +9.4% +22.6% Organic +8.9%, Fx ‐0.6% $ millions $ dollars $ m
Slide 6: Full Year 2018 Results
Full Year 2018 Results Full Year Highlights • Achieved strong organic sales growth of 7.0% • Overall performance and commitment to continuous improvement more than offset the impact of higher material costs • Increased diluted EPS 25% as a result of stronger operating performance and a lower effecti
Slide 7: Full Year 2018 Results: Additional Highlights
Full Year 2018 Results Additional Highlights • Another quarter and year of exceptional cash flow generation • Ended year with a strong balance sheet and cash and available liquidity of $393 million Free Cash Flow(1) Leverage Ratio(2) Net Debt to EBITDA(2) $ millions $72.8 $100.2 $108.3 2.6x 1.9x 1.3
Slide 8: Other Recent Accomplishments
Other Recent Accomplishments 1 Focused M&A Strategy 2 Driving Value Through Share Repurchases • Implementing strategy and developing pipeline to • TriMas repurchased ~1% of shares outstanding build out Packaging platform (442,632 for $12.1 million) in 2018 – Closed Plastic Srl Acquisition • As annou
Slide 9: Segment Results
SS TriMas Segment Results
Slide 10: Packaging Segment – Q4 and Full Year 2018
Packaging Segment – Q4 and Full Year 2018 Net Sales Operating Profit +5.1% +6.9% +5.9% +2.8% Organic +6.5%, Fx ‐1.4% Organic +6.4%, Fx +0.5% $ millions $19.0 $20.1 $84.6 $ millions $368.2 $82.3 $ millions $85.3 $89.7 $344.6 $ millions 22.5% 23.9% 23.0% 22.3% Q4 2017 Q4 2018 FY 2017 FY 2018 Q4 2017 Q
Slide 11: Aerospace Segment – Q4 and Full Year 2018
Aerospace Segment – Q4 and Full Year 2018 Net Sales Operating Profit +6.2% +0.9% +4.7% +4.3% $ millions $ millions $26.4 $27.5 $ millions $184.3 $185.9 $6.6 $6.9 $ millions $42.8 $45.4 15.3% 15.1% 14.3% 14.8% Q4 2017 Q4 2018 FY 2017 FY 2018 Q4 2017 Q4 2018 FY 2017 FY 2018 Quarterly Takeaways Brands
Slide 12: Specialty Products Segment – Q4 and Full Year 2018
Specialty Products Segment – Q4 and Full Year 2018 Net Sales Operating Profit +13.6% +11.8% +51.8% +30.9% $ millions $ millions $ millions $ millions $67.1 $76.3 $288.9 $323.0 $5.1 $7.7 $27.6 $36.2 7.5% 10.1% 9.6% 11.2% Q4 2017 Q4 2018 FY 2017 FY 2018 Q4 2017 Q4 2018 FY 2017 FY 2018 Quarterly Takeaw
Slide 13: Financial Position & Outlook
Financial Position & Outlook
Slide 14: Strong Balance Sheet and Available Liquidity
Strong Balance Sheet and Available Liquidity Continued Strengthening of Financial Position • Generated 2018 Free Cash Flow(1) of $108.3 million, or approximately 134% of net income • Increased LTM Adjusted EBITDA to $167.3 million compared to $154.8 million at 2017 year end • Reduced leverage ratio
Slide 15: 2019 Updates
2019 Updates 1 Reportable Segments 2 Cash Flow • Realigned machined components operation to • Expect further leveraging of working capital as a Specialty Products (~$30 million in sales) percentage of sales in 2019 – Leverages machining capabilities and resources • Modest capital investment increase
Slide 16: 2019 Full Year Guidance
2019 Full Year Guidance As of 2/28/19 TriMas FY 2019 Guidance Organic Sales Growth 3% ‐ 5% EPS, diluted $1.82 ‐ $1.92 ‐ Effective tax rate: 22% ‐ 23% ‐ Interest expense: ~$14 million Free Cash Flow(1) > 100% of Net Income ‐ Capex: ~3.5% of sales Enterprise‐wide Expenses: ‐ Corporate expenses: ~$22 m
Slide 17: Levers for Continued Share Growth
Levers for Continued Share Growth 1 2 3 4 Continuous Shaping Capital Innovation Improvement TriMas Allocation • TriMas Business Model • Investing in growth • Accelerating the focus of • Reinvestment in factory through innovative TriMas on its highest floor improvements • Championing a culture produc
Slide 18: SS TriMas
SS TriMas
Slide 19: Appendix
SS TriMas Appendix
Slide 20: 2019 Segment Guidance
2019 Segment Guidance Organic Sales Operating Segment Growth(1) Profit Margin Packaging 3% – 5% 22% – 23% Aerospace(2) 3% – 4% 16% – 17% Specialty Products(2) 4% – 6% 11% – 13% Balanced performance through our diverse portfolio of businesses. Note: All of the figures and comments on this slide exclu
Slide 21: Condensed Consolidated Balance Sheet
Condensed Consolidated Balance Sheet December 31, December 31, 2018 2017 (unaudited) Assets Current assets: Cash and cash equivalents $ 108,150 $ 27,580 Receivables, net 123,110 112,220 Inventories 173,120 155,350 Prepaid expenses and other current assets 7,430 16,120 Total current assets 411,810 31
Slide 22: Consolidated Statement of Income
Consolidated Statement of Income Three months ended Twelve months ended December 31, December 31, 2018 2017 2018 2017 Net sales $ 211,350 $ 195,210 $ 877,140 $ 817,740 Cost of sales (154,110) (146,000) (633,020) (598,350) Gross profit 57,240 49,210 244,120 219,390 Selling, general and administrative
Slide 23: Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows Twelve months ended December 31, 2018 2017 Cash Flows from Operating Activities: Net income $ 83,300 $ 30,960 Adjustments to reconcile net income to net cash provided by operating activities: Loss on dispositions of assets 250 1,080 Depreciation 24,580 26,950 Amo
Slide 24: Company and Segment Financial Information
Company and Segment Financial Information Three months ended Twelve months ended December 31, December 31, 2018 2017 2018 2017 Packaging Net sales $ 89,660 $ 85,310 $ 368,200 $ 344,570 Operating profit $ 20,140 $ 18,980 $ 84,590 $ 80,610 Special Items to consider in evaluating operating profit: Busi
Slide 25: Additional Information on Non-GAAP Measures
Additional Information on Non‐GAAP Measures Three months ended Twelve months ended December 31, December 31, 2018 2017 2018 2017 Net income (loss), as reported $ 16,710 $ (4,010) $ 83,300 $ 30,960 Special Items to consider in evaluating quality of net income (loss): Business restructuring and severa
Slide 26: Additional Information on Non-GAAP Measures
Additional Information on Non‐GAAP Measures Three months ended December 31, 2018 2017 As reported Special Items As adjusted As reported Special Items As adjusted Net cash provided by operating activities $ 46,230 530 $ 46,760 $ 47,410 $ 1,970 $ 49,380 Less: Capital expenditures (9,160) ‐ (9,160) (12
Slide 27: Additional Information on Non-GAAP Measures
Additional Information on Non‐GAAP Measures Three months ended Twelve months ended December 31, December 31, 2018 2017 2018 2017 Net income (loss), as reported $ 16,710 $ (4,010) $ 83,300 $ 30,960 Depreciation expense 5,950 8,060 24,580 26,950 Amortization expense 4,840 5,000 19,440 19,920 Interest