Commercial Vehicle Group, Inc. · NASDAQ:CVGI
Commercial Vehicle — Investor Presentation (September 2019)
23 slides from Commercial Vehicle's investor presentation, Sep 5, 2019
Slide 1: Investor Presentation September 2019
Patrick Miller President & CEO Tim Trenary Chief Financial Officer & Treasurer Kirk Feiler VP Corporate Development & COMMERCIAL VEHICLE GROUP, INC. Investor Relations September 2019 Investor Presentation
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements that are subject to risks and uncertainties. These statements often include words such as “believe”, “anticipate”, “plan”, “expect”, “intend”, “will”, “should”, “could”, “would”, “project”, “continue”, “likely”, and sim
Slide 3: Investment Highlights
Investment Highlights Leading supplier of electrical wire harnesses, seating systems and a full range of cab related components to the global commercial vehicle industry Strong and growing global presence – 25 facilities across North America, Europe and Asia Pacific FY 2018 revenue $898 millio
Slide 4: 2018 Sales by Region, Product, End Market and Customer
2018 Sales Region Product 11% 7% N. America 8% Seating Systems 18% EMEA 41% Wire Harnesses APAC 22% Trim 71% Structures 22% Wipers / Mirrors End Market Customer Volvo 8% OEM Truck 4% 19% 5% Daimler OEM Construction 33% 15% 46% Paccar 16% Aftermarket Caterpillar 6% 22% OEM Automotive John Deere 7% 11
Slide 5: Products
Products Seats & Seating Systems Wire Harnesses & Controls Wiper Systems, Mirrors & Interior Trim Cabs and Sleeper Boxes Controls Page | 5 COMMERCIAL VEHICLE GROUP, INC.
Slide 6: Electrical Systems
Electrical Systems Electrical Systems Segment: Electrical wire harnesses and panel assemblies for increasingly complex and content-rich electrical and data distribution systems in vehicles and other applications; trim products evolving to include electrical content FY 2018 MARKET SECTOR MIX PRODUCT
Slide 7: Growth Drivers – Electrical Systems
Growth Drivers – Electrical Systems Macro Economic Trends - Global electrical distribution market expected to grow 6.5% CAGR through 2023* Diversification - Adjacent market penetration in truck powertrain, power generation, European off-road, and other industrial applications Digitalization an
Slide 8: Global Seating
Global Seating Global Seating Segment: Strong brand recognition in $3.1B addressable global market* (~$15B available market)* with established market position and new wins in Asia Pacific market FY 2018 MARKET SECTOR MIX PRODUCT METRICS (SALES) PORTFOLIO SALES 7% 5% Seats and Seating Systems 21% 43%
Slide 9: Growth Drivers – Global Seating
Growth Drivers – Global Seating Brand - Strong brand recognition Product Enhancements - New modular seat product leverages product engineering, design and manufacturing capabilities across end markets; maintains functionality and styling options while reducing complexity and cost Global Trends
Slide 10: End Market Outlook - North America
End Market Outlook - North America Heavy-Duty Truck (Class 8) Build (000’s) Medium-Duty Truck (Class 5-7) Build (000’s) 345 343 324 273 273 266 274 292 249 260 261 264 256 238 2017 2018 2019E 2020E 2021E 2022E 2023 E 2017 2018 2019E 2020E 2021E 2022E 2023E Source: August 2019 ACT Research Report • C
Slide 11: End Market Outlook – Global Construction Equipment
End Market Outlook – Global Construction Equipment HD-MD Construction Machinery (000’s) Excavator Industry US/CAN* (6-40mt) (000’s) 1,216 1,121 32.5 32.8 1,019 29.9 896 24.7 2017 2018 2019E 2020E 2017 2018 2019E 2020E Source: Management estimates, Millmark, S&OP data *Global Excavator growth in line
Slide 12: Secular Growth Themes Drive Investment
Secular Growth Themes Drive Investment Target high-growth, less cyclicalTarget highadjacent-growth, markets less (e.g. cyclicalindustrial markets automation) Trends driving Grow core wire harness proliferation of Deliver differentiated and trim products with electrical solutions new customers compon
Slide 13: 2019 Investments to Support Growth
2019 Investments to Support Growth Expanding wire • Adding low to mid volume capabilities and capacity • New market opportunities in medium-duty, construction and power harness facility in train Ukraine • Operational in 2H 2019 • Purpose-built facility with lean concepts • Insourcing = cost savings
Slide 14: Finance Update
Finance Update COMMERCIAL VEHICLE GROUP, INC.
Slide 15: Historical Performance
Historical Performance Revenues (Millions) Operating Income (Millions) & Margin $898 7.4% $755 3.8% 4.1% $67 $662 $25 $31 2016 2017 2018 2016 2017 2018 Strong end-market performance Reflects benefit of margin enhancement actions Revenues up 36% from 2016 Restructuring Both segments contrib
Slide 16: 1H 2019 Financial Update
1H 2019 Financial Update $M except per share data 1H 2019 1H 2018 Change Revenue 486.4 449.1 8% Gross Profit 68.3 66.4 3% Gross Margin 14.1% 14.8% SGA 31.4 29.6 6% Operating Income 36.3 36.2 - Operating Margin 7.5% 8.1% Diluted Earnings Per Share 0.60 0.75 (0.15) • Revenue up 8% • Continued strength
Slide 17: Electrical Systems Segment Results
Electrical Systems Segment Results Electrical Systems 1H 2019 Sales $M 1H 2019 1H 2018 Change Revenue 285.6 257.5 11% Gross Profit 40.0 39.3 2% 20% Truck OEMs Gross Margin 14.0% 15.3% Construction OEMs 10% 53% SG&A 7.8 7.5 4% Aftermarket / OE Service 17% Other Operating Income 31.8 31.4 2% Operating
Slide 18: Global Seating Segment Results
Global Seating Segment Sales Global Seating 1H 2019 Sales $M 1H 2019 1H 2018 Change Revenue 209.3 197.3 6% Gross Profit 28.5 27.6 3% 11% Truck OEMs Gross Margin 13.6% 14.0% 20% Construction OEMs 48% Aftermarket / OE Service SG&A 10.5 11.2 (6)% Other 21% Operating Income 17.7 16.1 10% Operating Margi
Slide 19: Capital Structure
Capital Structure $M 6/30/2019 6/30/2018 Cash 60.5 44.7 ABL Availability 63.4 63.3 Liquidity 123.9 108.0 Debt 162.1 170.6 TTM EBITDA 79.5 72.1 Gross Leverage 2.0x 2.2x Net Leverage 1.3x 1.7x • No borrowings on asset based line of credit in first half of 2019 • Net Leverage of 1.3x well below target
Slide 20: Investment Highlights
Investment Highlights Leading supplier of electrical wire harnesses, seating systems and a full range of cab related components to the global commercial vehicle industry Strong and growing global presence – 25 facilities across North America, Europe and Asia Pacific FY 2018 revenue $898 millio
Slide 21: Appendix
Appendix COMMERCIAL VEHICLE GROUP, INC.
Slide 22: Use of Non-GAAP Measures
Use of Non-GAAP Measures This presentation contains financial measures that are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). In general, the non-GAAP measures exclude items that (i) management believes reflect the Company’s multi-year corporate activities
Slide 23: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures $ M Trailing Twelve Months Ended 2019 2018 Net Income $ 39.8 $ 20.6 Interest 18.1 12.7 Provision for Income Taxes 6.9 23.5 Depreciation 13.4 14.0 Amortization 1.3 1.3 EBITDA $ 79.5 $ 72.1 As of June 30, 2019 2018 Term Loan Debt per Balance Sheet
Commercial Vehicle Group — Investor Presentation (September 2019) on 6ix