Slide 1: Q4 & Full Year 2014 Conference Call
Axalta Coating Systems Ltd. Q4 & Full Year 2014 Conference Call March 11, 2015
Slide 2: Notice Regarding Forward Looking Statements, Non-GAAP Financial Measures and Defined Terms
Notice Regarding Forward Looking Statements, Non-GAAP Financial Measures and Defined Terms Forward-Looking Statements This presentation and the oral remarks made in connection herewith may contain “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of
Slide 3: Axalta – A Leader in Coatings
Axalta – A Leader in Coatings Net Sales1 $4,362 million Adjusted EBITDA1,2 $841 million Adjusted EBITDA Margin3 19.3% Performance Coatings Transportation Coatings Segments 59% of Sales 41% of Sales Refinish Industrial Light Commercial End- Vehicle Vehicle Markets (42% of Sales) (17% of Sales) (32% o
Slide 4: Q4 & Full Year 2014 Highlights
Q4 & Full Year 2014 Highlights • Solid Q4 2014 results across both segments – Net sales up 5% compared to 2013, excluding currency, with volume and price growth in both segments; reported net sales down 1% as a result of negative currency movements – Adjusted EBITDA of $205 million, representing a 1
Slide 5: Q4 2014 Consolidated Results
Q4 2014 Consolidated Results Financial Performance Commentary Q4 % Change Net sales increased 5.1% YoY, ($ in millions) 2014 2013 Incl. F/X Excl. F/X excluding currency Performance 640 645 (0.8%) 6.3% • Volume growth in North America, Latin Transportation 438 448 (2.1%) 3.2% America and Asia Pacific
Slide 6: Q4 2014 Performance Coatings Results
Q4 2014 Performance Coatings Results Financial Performance Commentary Q4 % Change Net sales increased 6.3% YoY, ($ in millions) 2014 2013 Incl. F/X Excl. F/X excluding currency Refinish 466 467 (0.1%) 7.6% • Refinish experienced increased volume Industrial 174 178 (2.4%) 2.9% across all regions exce
Slide 7: Q4 2014 Transportation Coatings Results
Q4 2014 Transportation Coatings Results Financial Performance Commentary Q4 % Change Net sales increased 3.2% YoY, ($ in millions) 2014 2013 Incl. F/X Excl. F/X excluding currency Light Vehicle 339 353 (3.9%) 1.4% • Light vehicle volume increases in Asia Pacific Commercial Vehicle 99 95 4.8% 10.2% o
Slide 8: FY 2014 Consolidated Results
FY 2014 Consolidated Results Financial Performance Commentary Full Year % Change Net sales increased 4.0% YoY, ($ in millions) 2014 2013 Incl. F/X Excl. F/X excluding currency Performance 2,585 2,512 2.9% 5.0% • Net sales volume growth in North America Transportation 1,777 1,765 0.6% 2.5% and Asia P
Slide 9: Update on Transition-Related and One-Time Costs
Update on Transition-Related and One-Time Costs • Transition-related expenses from separation from DuPont are now complete. Q4 expenses primarily related to the remainder of our IT transition and stabilization as well as completion of rebranding requirements • Incurred restructuring expenses associa
Slide 10: Debt and Liquidity Summary
Debt and Liquidity Summary Capitalization Net Leverage ($ in millions) @ 12/31/2014 Maturity 5.6x Cash and Cash Equivalents $382 Debt: 5.2x Revolver ($400 capacity) - 2018 5.0x First Lien Term Loan (USD) 2,166 2020 First Lien Term Loan (EUR) (1) 481 2020 4.7x 4.7x Senior Secured Notes (EUR) (1) 305
Slide 11: Full Year 2015 Guidance
Full Year 2015 Guidance • We intend to provide annual guidance in Q1 and update it quarterly • Excluding F/X, net sales are expected to increase 5% to 7% versus 2014 while net sales including F/X are expected to be flat to slightly down YoY – Increase across all regions and end-markets excluding F/X
Slide 12: Full Year 2015 Assumptions
Full Year 2015 Assumptions Macroeconomic Assumptions Currency Assumptions • Global GDP growth of approximately 3% 2015 Avg. % Axalta 2014 % Change Currency Guidance • Global industrial production of Net Sales Avg. Rate in F/X Rate Rate approximately 4% US$ per Euro ~30% 1.33 1.10 (17.3%) • Global au
Slide 13: Strong Earnings Momentum with Potential Upside
Strong Earnings Momentum with Potential Upside Future Attractive Potential Upside ▲ Bolt-on acquisitions ▲ Partnerships Ongoing Initiatives ▲ Consolidation opportunities Operational Improvements Optimize procurement Streamline operations Enhance productivity Axalta Growth Initiatives Strong
Slide 14: Appendix
AXALTA Appendix
Slide 15: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Predecessor January 1, through Pro Form a January 31, Successor Successor Successor Successor ($ in millions) FY 2013 2013 FY 2013 FY 2014 Q4 2013 Q4 2014 Net Income (Loss) (107) $9 (219) $35 (47) $1 Interest Expense 235 - 215 217 62 51 Provision (Benefit) for Income T
Slide 16: Adjusted EBITDA Reconciliation (cont’d)
Adjusted EBITDA Reconciliation (cont’d) A. During the Successor year ended December 31, 2013, we recorded a non-cash fair value adjustment associated with our acquisition accounting for inventories. These amounts increased cost of goods sold by $104 million. B. In connection with the Acquisition, we
Slide 17: Adjusted EBITDA Reconciliation (cont’d)
Adjusted EBITDA Reconciliation (cont’d) I. Represents costs associated with the IPO including a $13 million payment to terminate consulting agreement (see note L). J. Represents costs for certain unusual or non-operational (gains) and losses and the non-cash impact of natural gas and currency hedge
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