Slide 1: Financial Results Fourth Quarter Fiscal Year 2021
Financial Results Fourth Quarter Fiscal Year 2021 Quarter Ended June 30, 2021 Supplementary Information to August 5, 2021 Earnings Conference Call
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements contained within this supplementary information, including our fiscal year 2022 guidance, and any statements made during our earnings conference call today may be considered forward-looking under the Private Securities Litigation Reform Act of 1995. The state
Slide 3: Speakers on today's call
Speakers on today’s call • Don Charron - Chairman & CEO • Jana Croom - Vice President, CFO • Andy Regrut - Head of Investor Relations 3
Slide 4: Q4 2021 financial highlights
Q4 2021 financial highlights • Strong top line growth, sales increase 15% year-over-year • Margin expansion: • Gross margin rate up 240 bps compared to Q4 2020 • Adjusted non-GAAP operating income(1) 5.5% of net sales • 170 bps increase over Q4 last year • 4th consecutive quarter exceeding goal of 4
Slide 5: Fiscal 2021 a record year
Fiscal 2021 a record year FISCAL 2021 FINANCIAL HIGHLIGHTS ROIC 13.1% • Net sales totaling $1.292 billion, up 8% over fiscal 2020 7.1% • Adjusted non-GAAP operating income(1) 5.2% of net sales, a 180 bps increase over last year FY ‘21 FY ’20 • Adjusted non-GAAP net income(1) of $56.4 million, or adj
Slide 6: Fiscal 2022
Fiscal 2022 As a result of the ongoing semiconductor shortage, a portion of our shippable backlog continues to shift out ahead of us... • Expecting two very different halves to fiscal 2022 • Our full year guidance contemplates this bifurcation • Expect material supply to catch-up with demand through
Slide 7: Q4 sales increased 15% over the prior year
Q4 sales increased 15% over the prior year Stronger finish to the fiscal year than expected, led by Automotive & Industrial vertical markets 7
Slide 8: Sales in the Automotive vertical increased 92%
Sales in the Automotive vertical increased 92% Sales in Automotive Q4 Megatrends in Automotive Industry • Demand surges as consumers “take to the road” to re-engage with society • Growth in electronic content per vehicles with advanced technologies and operating systems • Applications and architectu
Slide 9: Sales in the Industrial vertical up 17%
Sales in the Industrial vertical up 17% Sales in Industrial in Q4 Strength in Industrial Vertical Market • Automation, Test & Inspection • Higher-end climate control products 9
Slide 10: Sales in the Medical vertical declined 31%
Sales in the Medical vertical declined 31% Sales decline resulting from strong sales in the prior year related to the COVID-19 pandemic and lower levels of elective procedures this year Sales in Medical Q4 Megatrends in Medical Industry • Aging population • Increasing access & affordability to care
Slide 11: Sales in the Public Safety vertical declined 10%
Sales in the Public Safety vertical declined 10% Sales in Public Safety Q4 Drivers in Sales Trend • Temporary impact of the COVID-19 • Sales is primarily related to commercial and hotel smart locking systems • Expect this market will return to normal over time as people resume travel 11
Slide 12: Strong quarter, great year, momentum into fiscal 2022
Strong quarter, great year, momentum into fiscal 2022 • Team executed throughout the year in the face of unprecedented challenges • Looking to minimize, or even negate, the global parts shortage • Strong company culture creating quality for life 12
Slide 13: Net sales increase sequentially and vs. Q4 2020
Net sales increase sequentially and vs. Q4 2020 NET SALES HIGHLIGHTS NET SALES TREND • Sales increase 15% compared to Q4 2020 • Sales grow 6% versus the prior quarter • Strength in Automotive and Industrial vertical markets • Favorable FX of 3% compared to Q4 2020 13
Slide 14: Gross margin rate up 240 bps compared to Q4'20
Gross margin rate up 240 bps compared to Q4’20 DRIVERS OF GM% IMPROVEMENT GROSS MARGIN TREND • Operating execution • Higher sales volume in Automotive vertical • Favorable FX 14
Slide 15: Adjusted Selling & Administrative Expense (%)
Adjusted Selling & Administrative Expense (%) (1)(2) (1) Adjusted Selling & Administrative Expense is a Non-GAAP measure – refer to Reconciliation of Non-GAAP Results on the final slide of this supplementary information. (2) Beginning in Q1’21, Adjusted Selling & Administrative Expense excludes chan
Slide 16: Adjusted Operating Income
Adjusted Operating Income (1)(2) (1) Adjusted Operating Income is a Non-GAAP measure – refer to Reconciliation of Non-GAAP Results on the final slide of this supplementary information. (2) Beginning in Q1’21, Adjusted Operating Income excludes changes in the fair value of our supplemental employee r
Slide 17: Other Income & Expense
Other Income & Expense Q4 '21 Q4 '20 SERP Impact $0.5 $1.3 FX gain/loss $0.5 $0.6 Interest expense ($0.4) ($0.9) All other expense ($0.2) ($3.7) Total $0.4 ($2.7) 17
Slide 18: Adjusted Net Income and Adjusted Diluted EPS
Adjusted Net Income and Adjusted Diluted EPS (1) (1) Adjusted Net Income and Adjusted Diluted EPS are Non-GAAP measures – refer to Reconciliation of Non-GAAP Results on the final slide of this supplementary information. 18
Slide 19: Balance sheet
Balance sheet • Cash & cash equivalents were $106 million, compared to $65 million last year • Cash flow provided by operating activities during Q4 was $26.3 million, our fifth consecutive quarter of $20 million plus • Cash conversion days were 64 days in Q4, down 17 days year-over-year and down 2 d
Slide 20: Many financial metrics reached all-time highs in 2021
Many financial metrics reached all-time highs in 2021 Net Sales Gross Margin % Operating Income %* EPS* FY '21 FY '20 FY '21 FY '20 FY '21 FY '20 FY '21 FY '20 $1.3B $1.2B 9.1% 7.0% 5.2% 3.4% $2.23 $1.10 +8% YOY +210 bps YOY +180 bps YOY +2x LY * Adjusted non-GAAP (1) ROIC • Generated $130 million o
Slide 21: Fiscal 2022 guidance
Fiscal 2022 guidance • Net sales in the range of $1.4 - $1.5 billion, an 8% - 16% increase over fiscal 2021 • Operating income expected to be 4.5% - 5.0% of net sales • CapEx of $60 - $70 million 21
Slide 22: Q&A
<= Kimball Electronics Q&A 22
Slide 23: Appendix
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Slide 24: Reconciliation of Non-GAAP Results
Reconciliation of Non-GAAP Results (Unaudited, Amounts in Thousands, Except Per Share Data) Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Selling & Administrative Expenses, as reported $ $ 11,078 $ 11,827 $ 9,624 $ 11,391 $ $ 13,117 13,486 11,744 14,357 Less: SERP(2) (22) 502 (914) 1,282 550 811 1