Federal Signal Corporation · NYSE:FSS
Federal Signal — Investor Presentation (May 2010)
24 slides from Federal Signal's investor presentation, May 17, 2010
Slide 1: Investor Presentation May 2010
Investor Presentation May, 2010
Slide 2: Takeaways
2 Takeaways New management team - decisive actions taken to position the Company for future growth Base businesses poised for higher margins Improving revenue environment Increased operating leverage New growth platform: FSTech
Slide 3: About Federal Signal
3 About Federal Signal Founded in 1901, Federal Signal enhances the safety, security and well-being of communities and workplaces around the world Leading global designer and manufacturer of products and total solutions that serve municipal, governmental, industrial and institutional customers Will
Slide 4: Today's Federal Signal: Powerful Drivers Across the Portfolio
4 Today's Federal Signal: Powerful Drivers Across the Portfolio Fire Rescue Group ("Bronto") Federal Signal Technologies Infrastructure management needs Business and society have a safety and security mandate Applying information technology to new and traditional markets Customers consolidating supp
Slide 5: Attractive Business Drivers
5 Attractive Business Drivers Infrastructure management needs Business and society have a safety and security mandate Customers consolidating supplier base - turning to established brands and vendors Applying information technology to new and traditional markets Globalization, urbanization & aging i
Slide 6: Active Management and Board
6 Active Management and Board Significant municipal exposure Lower application of technology High cost base Captive financial services business Board appointed new management in 2008 Legacy Federal Signal (2007 Net Sales) Environmental Solutions Group (ESG) 46% Safety and Security Systems Group (SSG
Slide 7: Federal Signal: At an Inflection Point in Growth
7 Federal Signal: At an Inflection Point in Growth Future Federal Signal Federal Signal Technologies and Safety and Security Systems groups Operational excellence: increased operating leverage, poised for recovery Execute on growth opportunities in core growth markets Improved operating leverage, sc
Slide 8: Environmental Solutions Group (ESG)
8 Street Sweepers Sewer Cleaners Combination Cleaners Catch Basin Cleaners Jetting Units Hydroexcavators Industrial Vacuum Loaders Waterblasters #1 NA & SA in street sweepers #1 NA in truck mounted sewer cleaners #2 NA in truck mounted hydroexcavators #1 NA in industrial vacuum trucks #3 NA in high
Slide 9: Environmental Solutions Group Update, Drivers and Opportunities
9 Environmental Solutions Group Update, Drivers and Opportunities Update Strong cost reduction execution in 2009 Overhead costs reduced $10.6 million Improving revenue environment in 2010 Q1 orders ^30% vs. last year and ^19% vs. Q4 2009 Double-digit Q1 order growth in municipal, industrial and inte
Slide 10: Fire Rescue Group (Bronto)
10 Fire and rescue platforms Truck-mounted aerial platforms Fire fighting and rescue equipment end markets Fire Rescue Group ("Bronto") U.S. Non-U.S. 3rd Qtr 4th Qtr Orders 7.9 92.1 Total: $160 million U.S. 8% Non-U.S. 92% #1 Aerial lift platforms for fire and rescue Products and Brands Market Posit
Slide 11: Fire Rescue Group (Bronto) Update, Drivers and Opportunities
11 Fire Rescue Group ("Bronto") Update, Drivers and Opportunities Update Capacity expansion and process improvements driving higher margins 2009 operating margin ^5% to 12% Improving order trend Q1 2010 orders ^52% vs. last year Fourth consecutive quarter of sequential order increase Lower order bac
Slide 12: Safety and Security Systems Group
12 #1 WW vehicular lights and sirens Products and Brands Environmental Solutions Group (ESG) 2009 Net Sales U.S. Non-U.S. 3rd Qtr 4th Qtr Orders 56.8 43.2 Net Sales: $293 million U.S. 57% Non-U.S. 43% Market Position Safety and Security Systems Group #1 WW mining electrical safety products (connecto
Slide 13: Safety and Security Systems Group Update, Drivers and Opportunities
13 Safety and Security Systems Group Update, Drivers and Opportunities Update Strong cost reduction execution in 2009 Overhead costs reduced by $9.6 million 9.4% operating margin Improving revenue environment in 2010 Q1 2010 orders ^8% vs. last year and ^6% vs. Q4 2009 Q1 2010 international orders ^
Slide 14: Federal Signal Technologies Group: Brands, Products & Applications
14 Brands, Products & Applications Environmental Solutions Group (ESG) Shared Competencies & Leadership Platform Federal Signal Technologies Group Automated License Plate Recognition (ALPR) Transportation, public safety Electronic tolling, electronic vehicle registration Parking, supply chain Transa
Slide 15: Federal Signal's Complete Electronic Toll System
15 Federal Signal's Complete Electronic Toll System Lane and Back Office Hardware/Software 4. Lane Controller: 5. Transaction Processing / Violation Enforcement: Step 1. Vehicle Classification: 3. ALPR Camera / Video Tolling / Enforcement: 2. Vehicle Identification / RFID Tags & Readers: Competitive
Slide 16: Acquisitions Increase Ability to Target Higher Value and Margin Content
16 Acquisitions Increase Ability to Target Higher Value and Margin Content Addressable Portion of "Typical" Toll Contract, Pre Acquisitions <10% of typical lane and back office contract Tier 2 vendor; unable to influence procurement decisions Leading technology but limited ability to influence buyin
Slide 17: Funds Needed to Finance Infrastructure Improvement
17 Funds Needed to Finance Infrastructure Improvement The Future: More User Fees Transportation infrastructure operating at high capacity, significant investment is needed U.S. government projects a shortfall in funds to pay for required transportation infrastructure investment: Shortfall for period
Slide 18: Common Core Technology Platform - Numerous Global Markets
18 Common Core Technology Platform - Numerous Global Markets Speed Enforcement (Spot, Time Over Distance) Other Public Safety I.D. Vehicles of Interest Border Patrol Critical Facility Protection Amber Alerts Port Security Red Light Enforcement Supply Chain Asset Tracking IntelliDrive Arterial Manage
Slide 19: FSTech Global Project Examples
19 Los Angeles: Ports of LA & Long Beach congestion program Minnesota: HOT lane system implementation California: Tag provider for state's toll system Texas: Operations and IT Support Florida: Idris dominant provider in U.S. Open Road Toll vehicle classification New York: Event parking management sy
Slide 20: Financial Review
fig oe some. Financial Review
Slide 21: Financials - Setting the Stage
21 Financials - Setting the Stage Since 2008: Divested select lower growth and non-core businesses "Replaced" these businesses with higher growth and higher margin businesses Approximately $60 million cash flow from operations in 2009 Reduced overhead costs by $30 million in 2009 Reduced working cap
Slide 22: Segment Orders, Sales and Operating Income
($ Millions) Fiscal Year 1st Quarter 2007 2008 2009 2009 2010 Safety and Security Systems Group Orders $339.8 $341.3 $277.7 $71.2 $76.9 Sales 340.4 345.9 292.7 70.8 68.3 Operating Income 44.0 35.2 27.5 4.9 4.1 Operating Margin 12.9% 10.2% 9.4% 6.9% 6.0% Fire Rescue Group Orders $174.1 $162.3 $96.6 $
Slide 23: Federal Signal: At an Inflection Point in Growth
23 Federal Signal: At an Inflection Point in Growth Future Federal Signal Federal Signal Technologies and Safety and Security Systems groups Operational excellence: increased operating leverage, poised for recovery Execute on growth opportunities in core growth markets Improved operating leverage, s
Slide 24: May, 2010
Investor Presentation May, 2010