Visteon Corporation · NASDAQ:VC
Visteon — Citi Global Industrials Conference 2014
45 slides from Visteon's conference presentation, Sep 22, 2014
Slide 1: Citi Global Industrials Conference
Exhibit 99.1 Citi Global Industrials Conference September 2014 Strictly Private and Confidential
Slide 2: Recent Highlights
Recent Highlights Solid Second-Quarter 2014 Financial Results (1) – Sales of $2.0 billion ($1.8 billion ex. discontinued operations, up 11% vs. Q2 2013) – Adjusted EBITDA of $193 million; highest quarterly Adjusted EBITDA in Visteon’s history (2) $175 million excluding discontinued operations – Adju
Slide 3: Second-Quarter 2014 Sales Breakdown
Second-Quarter 2014 Sales Breakdown Q2 2014 Global Production Visteon Q2 2014 Sales by Region $1.8 Billion $2.1 Billion 21.9 Million Units (Reported) (Including JCI) (1) Asia 51% 47% Asia 52% 24% 30% Europe Europe 27% 14% 20% N. America 19% 20% N. America U.S. 6% 5% S. America U.S. U.S. S. America 4
Slide 4: Update: JCI Electronics Acquisition
Update: JCI Electronics Acquisition Visteon completed the acquisition of the electronics business of Johnson Controls (JCI) on July 1 – Business acquired provides automakers with advanced driver information, infotainment, connectivity and body electronics products – Adds approximately 5,000 new empl
Slide 5: The New Visteon
The New Visteon 2012 Strategic Plan The New Visteon Contribute Climate business to Two world-class, high-growth / margin Halla, create HVCC businesses Increased value of HVCC Industry-leading technologies and market ownership positions Sell Interiors business Announced Strong balance sheet with net
Slide 6: Visteon’s Two Businesses
Visteon’s Two Businesses NYSE (Ticker: VC) 2013 Sales: $7.9B (1) Thermal Management Electronics Korea Exchange (Ticker: 018880) Electronics 2013 Sales 2013 Sales $4.9B (2) $3.0B (1) Halla Visteon Climate Control Visteon Electronics majority-owned by Visteon and the world’s one of the world’s top thr
Slide 7: Visteon Electronics
Visteon Electronics September 2014 Strictly Private and Confidential
Slide 8: Visteon Electronics Today
Visteon Electronics Today #3 provider of cockpit electronics in the world #2 driver information supplier globally Balanced Asian, Americas and European footprint Broad customer profile that includes everything from entry-level vehicles to high- end German luxury vehicles Offerings across all major c
Slide 9: Visteon Today: The #3 Global Electronics Player
Visteon Today: The #3 Global Electronics Player Cockpit Electronics Market Share Post JCI Conti 17% Others 30% Denso 10% Pioneer 4% Visteon Bosch 4% 10% Delphi 5% 0% Harman Panasonic 5% Alpine 8% 7% Visteon is the #3 Provider of Cockpit Electronics in the World Page 9 Source: IHS Automotive and Vist
Slide 10: Visteon Today: Diversified Sales Footprint
Visteon Today: Diversified Sales Footprint Visteon Electronics 2013 Sales Breakdown (Adjusted to Include JCI) By Product By Region By Customer Vehicle SA Other Electronics 11% 3% 13% Daimler 3% VW 3% Ford Controls EU 35% 6% AP JLR 3% 29% 37% Mercedes 4% Mazda 4% GM/SGM 5% Audio & Instrument Clusters
Slide 11: Visteon Today: Innovative Technologies / Products
Visteon Today: Innovative Technologies / Products OpenAir ™ Infotainment LightScape ™ Head Units Rear-Seat Head-up Body Control Entertainment Displays Displays Modules In-Vehicle Instrument Connectivity Wireless Charging Clusters Gateway Visteon is Recognized as a Thought and Innovation Leader in th
Slide 12: Visteon Today: Technologies Acquired with JCI
Visteon Today: Technologies Acquired with JCI Advanced Digital Light Processing Visteon Fusion Infotainment System Windshield Head-Up Display Fusion is the integration of the traditional driver The advanced infotainment system is in production The convergence of consumer electronics and information,
Slide 13: The Future: New Technologies Will Drive Growth
The Future: New Technologies Will Drive Growth 4 The Consumer Electronics market continues to change, with new and innovative technologies coming to market rapidly 3 The Automobile The automotive market is leveraging these The Tablet technologies as well as identifying new opportunities – Significan
Slide 14: The Future: Visteon Electronics Poised to Capitalize
The Future: Visteon Electronics Poised to Capitalize Visteon Electronics Advantage Visteon Electronics Sales (1) $3.8 World’s #3 provider of cockpit electronics Diversified regional and customer profile $2.4 Offerings across all major cockpit electronics products Balanced global manufacturing and R&
Slide 15: Halla-Visteon Climate Control (HVCC)
Halla-Visteon Climate Control (HVCC) September 2014 Strictly Private and Confidential
Slide 16: Halla-Visteon Climate Control (HVCC)
Halla-Visteon Climate Control (HVCC) In Q1 2013, Visteon contributed the majority of its #2 global auto climate company Climate business to Halla One of only two “full-line” suppliers Climate Control Corporation for cash Facilities in 20 countries – $410 million gross – 35 manufacturing facilities p
Slide 17: Proven Record of Transaction Integration / Success
Proven Record of Transaction Integration / Success HVCC has completed several key acquisitions and integrations in recent years From 2006-2012, acquired or increased ownership in 11 operations The HVCC transaction, completed in February 2013, added 10 more operations and significantly bolstered HVCC
Slide 18: Solid Performance in 2014
Solid Performance in 2014 (Dollars in Millions) Financial Results – Climate PG (1) HVCC 2014 Stock Price Performance nd 2 Quarter 2014 B/(W) HVCC 2013 2014 2013 +42% Sales $1,247 $1,332 7% Adj. EBITDA $136 $147 8% S&P 500 +8% % Margin 10.9% 11.0% 10 bps nd Climate 2 Quarter 2014 Sales and Adjusted E
Slide 19: Robust Growth: 7%+ Sales CAGR for HVCC
Robust Growth: 7%+ Sales CAGR for HVCC (Dollars in Millions) Building New Plants Strong Backlog Location Region Launch Overview $680 million backlog (incremental new booked business Guadalajara Mexico Q1 2014 • New plant net of lost business that will launch during the next three Jiangsu Province Ch
Slide 20: Driving Higher Margins
Driving Higher Margins Climate Product Group Adjusted EBITDA Margins 150 bps+ in margin enhancements from 2013 through 2017 (200 bps+ since 2012), driven by: – Leveraging fixed costs on growing sales 12.0% + – Reducing dependence on Korea 10.6% manufacturing base 10.0% – Launching new products – Res
Slide 21: HVCC: Positioned for Growth
HVCC: Positioned for Growth #2 automotive climate company in the world One of only two “full-line” suppliers Customer-focused solutions provider with a worldwide presence Recognized portfolio of innovative products and technologies Gaining share in growing markets $680 million backlog supports 7% gl
Slide 22: Second-Quarter 2014 Results
Second-Quarter 2014 Results August 2014 Strictly Private and Confidential
Slide 23: 2014 Financial Results
2014 Financial Results Q2 2014 results and Full-Year 2014 Guidance include the following items: Q2 2014 Results Full-Year 2014 Guidance Discontinued Operations: Beginning in Q2 Full-Year 2014 Guidance has been updated for 2014, Visteon began reporting the majority of five key items: the Interiors bu
Slide 24: First-Half 2014 Key Financials
First-Half 2014 Key Financials * (Dollars in Millions) First-Half 2013 2014 Sales $3,196 $3,500 Adjusted Gross Margin $313 $374 9.8% 10.7% Adjusted SG&A $140 $159 4.4% 4.5% Adjusted EBITDA $292 $336 (Ex. Disc Ops) 9.1% 9.6% Adjusted EBITDA $304 $363 (Incl. Disc Ops) Adjusted EPS $3.43 $2.33 Free Cas
Slide 25: Climate Summary
Climate Summary (Dollars in Millions) Selected Financial Metrics Year-over-Year Performance Sales Adj. EBITDA Margin (ex. Eq. Inc. / NCI) Sales Q2 YTD $1,332 2014 Actual $1,332 $2,600 $1,247 $1,265 $1,268 2013 Actual 1,247 2,475 $1,228 2014 B/(W) 2013 $85 $125 $1,131 Key Drivers Volume / Mix $70 $13
Slide 26: Electronics Summary
Electronics Summary (Dollars in Millions) Selected Financial Metrics Year-over-Year Performance Sales Sales Q2 YTD Adj. EBITDA Margin (ex. Eq. Inc. / NCI) 2014 Actual $443 $882 $439 $443 2013 Actual 354 719 2014 B/(W) 2013 $89 $163 $396 $365 $354 Key Drivers $340 Volume / Mix $16 $14 YFVE Consolidat
Slide 27: 2014 Guidance
2014 Guidance Mid-Point of Guidance Midpoint Guidance Product Sales $7.6 B Adjusted EBITDA (ex. Eq Inc / NCI) Including Discontinued Operations $715 M Excluding Discontinued Operations $690 M (3) Free Cash Flow (1) Free Cash Flow $0 M Adjusted Free Cash Flow $145 M (ex. Restructuring and Transaction
Slide 28: Preliminary 2015 Guidance
Preliminary 2015 Guidance 2014 Preliminary Midpoint 2015 Guidance Guidance Product Sales $7.6 B $8.5-8.7 B Adjusted EBITDA (ex. Eq Inc / NCI) Including Discontinued Operations $715 M Excluding Discontinued Operations $690 M $780-820 M Key Assumptions: Complete sale of all Interiors operations by yea
Slide 29: Preliminary 2015 Guidance vs. 2014 Guidance
Preliminary 2015 Guidance vs. 2014 Guidance Sales $8.6B $7.6B ($0.1B) $0.8B $0.3B Remove: Add: ½ Year Volume, Net Interiors Operations of JCI Electronics and New Business, That Were Not T&E Cooper Standard Currency Included in Disc Ops and Pricing 2014 Guidance 2015 Guidance Adjusted EBITDA $715M $8
Slide 30: Appendix
Appendix August 2014 Strictly Private and Confidential
Slide 31: Forward-Looking Information
Forward-Looking Information This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various factors, risks and uncertai
Slide 32: Use of Non-GAAP Financial Information
Use of Non-GAAP Financial Information Because not all companies use identical calculations, Adjusted Gross Margin, Adjusted SG&A, Adjusted Equity in Net Income of Non-Consolidated Affiliates, Adjusted EBITDA, Adjusted Net Income, Adjusted EPS, Free Cash Flow and Adjusted Free Cash Flow used througho
Slide 33: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information Sales 2013 2014 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr Net sales, products $1,586 $1,610 $1,484 $1,691 $6,371 $1,718 $1,782 Adjusted Gross Margin 2013 2014 The Company defines Adjusted (Dollars in Millions) 1st
Slide 34: Reconciliation of Non-GAAP Financial Information (cont’d)
Reconciliation of Non-GAAP Financial Information (cont’d) Adjusted EBITDA 2013 2014 2014 FY Guidance 2015 FY Guidance 2017 FY Guidance (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr Low-end High-end Low-end High-end Mid-point Adjusted EBITDA (ex. Discontinued Operati
Slide 35: Reconciliations of Adjusted Net Income, Earnings per Share and Adjusted Earnings per Share
Reconciliations of Adjusted Net Income, Earnings per Share and Adjusted Earnings per Share 2013 2014 2014 FY Guidance (Dollars and Shares in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr Low-end High-end Net income (loss) attributable to Visteon $69 $65 $43 $513 $690 $19 ($155)
Slide 36: Adjusted EPS Year-over-Year
Adjusted EPS Year-over-Year Adjusted EPS (Dollars and Shares in Millions) Q1 Q2 2014 Actuals $0.63 $1.71 2013 Actuals 2.02 1.41 2014 B/(W) Than 2013 ($1.39) $0.30 Impact Impact 1st Quarter 2nd Quarter Explanation of Change On EPS On EPS 2013 2014 B/(W) 2013 2014 B/(W) One-time Tax Adjustment ($1.04)
Slide 37: Cash Flow / Cash / Debt
Cash Flow / Cash / Debt (1) (Dollars in Millions) Free Cash Flow Visteon Cash and Debt Q2 Q2 YTD 6/30/14 2014 2014 Adjusted EBITDA (incl. disc. ops.) $193 $363 Cash ex. HVCC $1,091 Trade Working Capital (98) (75) HVCC Cash 334 Dividends from Non-Consolidated JVs 18 18 Total Cash $1,425 Cash Taxes (4
Slide 38: Adjusted EBITDA by Product Group
Adjusted EBITDA by Product Group Q2 2014 Product Group Adjusted EBITDA (Dollars in Millions) Climate Electronics Other Central / Elims Total Sales $1,332 $443 $32 ($25) $1,782 Adjusted EBITDA Build-up Adjusted Gross Margin $135 $64 ($4) - $195 Adjusted SG&A (37) (25) (1) (18) (81) D&A 49 11 1 - 61 A
Slide 39: Reconciliation of Climate Financial Information
Reconciliation of Climate Financial Information Climate 2013 2014 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr YTD Product Sales $1,228 $1,247 $1,131 $1,265 $4,871 $1,268 $1,332 $2,600 Gross Margin $112 $121 $98 $134 $465 $105 $134 $239 Other Non-Operating - - - -
Slide 40: Reconciliation of Electronics Financial Information
Reconciliation of Electronics Financial Information Electronics 2013 2014 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr YTD Product Sales $365 $354 $340 $396 $1,455 $439 $443 $882 Gross Margin $37 $41 $37 $45 $160 $73 $64 $137 Employee Charges / Corp Severance - - -
Slide 41: Reconciliation of Other Financial Information
Reconciliation of Other Financial Information Other 2013 2014 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr YTD Product Sales $47 $52 $44 $50 $193 $39 $32 $71 Gross Margin $1 $1 - $11 $13 $1 ($4) ($3) Employee Charges / Corp Severance - - - - - - - - Adjusted Gross
Slide 42: Reconciliation of Central (Including Discontinued Ops)
Reconciliation of Central (Including Discontinued Ops) Central (Including Discontinued Operations) 2013 2014 (Dollars in Millions) 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Full Year 1st Qtr 2nd Qtr YTD Product Sales ($54) ($43) ($31) ($20) ($148) ($28) ($25) ($53) Gross Margin - - - - - - - - Adjustments - -
Slide 43: U.S. NOL Overview
U.S. NOL Overview U.S. NOL development – Pre-emergence NOL of $1.1 billion, of which approximately $120 million can be used per year beginning in late 2015 – We anticipate between $100 and $200 million of post-emergence NOLs at the end of 2014 post the YFV transaction – We anticipate the exit of our
Slide 44: Second-Quarter 2014 Financial Results – U.S. GAAP
Second-Quarter 2014 Financial Results – U.S. GAAP Second Quarter (Dollars in Millions) 2013 2014 Product Sales $1,610 $1,782 Gross Margin $163 $194 SG&A $77 $84 Net Income / (Loss) $65 ($155) Attributable to Visteon Diluted EPS $1.29 ($3.35) Cash from Operations (1) $36 $31 Capital Expenditures (1)
Slide 45: www.visteon.com
www.visteon.com Page 45