Finning International Inc. · TSX:FTT
Finning International — Bank of America Merrill Lynch - Global Industrials & EU Autos Conference 2015
15 slides from Finning International's conference presentation, Mar 19, 2015
Slide 1: Investor Presentation
INVESTOR PRESENTATION Scott Thomson, President & CEO Mauk Breukels, VP Investor Relations & Corporate Affairs Bank of America Merrill Lynch - Global Industrials & EU Autos Conference March 19, 2015
Slide 2: Forward Looking Information
Forward Looking Information This report contains statements about the Company’s business outlook, objectives, plans, strategic priorities and other statements that are not historical facts. A statement Finning makes is forward-looking when it uses what the Company knows and expects today to make a s
Slide 3: Overview of Finning International
Overview of Finning International World’s largest Caterpillar dealer We sell, rent and provide parts and service for Caterpillar equipment and engines Yukon The Northwest Serving customers for over 80 years and delivering value to public Territories shareholders for over 45 years Operating i
Slide 4: Compelling Business Model, Strategy and Financial Position
Compelling Business Model, Strategy and Financial Position World class heavy equipment company World’s largest Caterpillar dealer Best products and the best territories Highly diversified business Geography: Three unique, high-quality OECD regions End markets: Serving a diversified spect
Slide 5: Broadest Range of Quality Caterpillar Products
Broadest Range of Quality Caterpillar Products Over 300 equipment product lines 5
Slide 6: Market Leader in Desirable Regions
Market Leader in Desirable Regions 2014 revenue by region 6
Slide 7: Diversified Business Anchored by Product Support
Diversified Business Anchored by Product Support 2013 Revenue 2014 Revenue Used Rental Used Rental 4% 6% 4% 5% UK & Ireland UK & Ireland 8% 10% Product Product Support South America South America 11% Support 16% 47% 49% BC/North BC/North 6% 6% Alberta Alberta 14% 13% New Equipment New Equipment 2014
Slide 8: Strong Full-Cycle Growth
Strong Full-Cycle Growth Consolidated New Equipment and Product Support Revenue $ Millions 7,000 4% 12% 3% 6,000 (1%) (5%) 31% 7% 5,000 9% 50% 19% 7% New Equipment (20%) 5% 27% 4,000 15% CAGR 5% (3%) 18% 13% (32%) Average $2,538M 3,000 8% 33% 12% Min $1,899M 18% 2,000 13% 12% Product Support 12% 0%
Slide 9: Canada – Strong Full-Cycle Growth
Canada – Strong Full-Cycle Growth New Equipment and Product Support Revenue $Millions 2008 – 2014 Machine Population – Canada 3,500 10% Compound Annual Growth Rate: 4% 3,000 2% 12% 11% 13% (8%) 33% 10% 15% New Equipment 2,500 12% 58% CAGR 6% 32% 18% 797 Off-Highway Trucks 2,000 39% (26%) (2%) Averag
Slide 10: Operational Priorities
Operational Priorities Priorities will drive improved Return on Invested Capital (ROIC) Service Excellence Service Excellence Target ∆ 2013-2016 Drives lowest equipment owning and operating costs Maximizes equipment uptime and improves customer loyalty Consolidated EBIT $ $40 – 60M Increases
Slide 11: Canada
Canada Higher ROIC in 2014 Driven by Progress on Operational Priorities EBIT and ROIC 2014 2013 EBIT ($ millions) 284 263 EBIT margin (%) 7.8 ↔ 7.8 Return on invested capital (%) 17.1 15.9 Invested Capital 2014 Q3 2014 Q2 2014 Q1 2014 2013 Invested capital(1) ($ millions) 1,475 ↔ 1,714 1,756 1,6
Slide 12: South America
South America Maintained Profitability During 2014 Market Downturn(1) 2014 vs. 2013 Part & Components Inventory down Revenue 17% 3% down Workforce 7% to 6,900 people 15% SG&A 12% despite higher severance costs Maintained EBIT margin(2) Net capital expenditure 45% Net rental addit
Slide 13: UK & Ireland
UK & Ireland Solid 2014 Results UK Real GDP(1) (% Change) 3.0 2.6 2.6 Maintained profitability in highly competitive 2.0 1.7 1.7 market 1.0 1.1 0.1 Improved invested capital turnover 0.0 Sustained outstanding customer loyalty ‐1.0 ‐2.0 Capturing Opportunities ‐3.0 ‐4.0 Strong general constru
Slide 14: Strong Balance Sheet
Strong Balance Sheet Net Debt to Invested Capital (%) Annual Dividends 53 0.6850 52 51 51 50 0.5975 47 48 0.55 0.51 42 43 0.47 41 41 0.43 0.44 39 0.36 0.28 31 0.20 0.22 Q4/11 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 201
Slide 15: Investor Presentation
INVESTOR PRESENTATION Scott Thomson, President & CEO Mauk Breukels, VP Investor Relations & Corporate Affairs Bank of America Merrill Lynch - Global Industrials & EU Autos Conference March 19, 2015