Adient Plc · NYSE:ADNT
Adient — Q1 FY2022 Earnings Presentation
27 slides from Adient's earnings presentation, Feb 4, 2022
Slide 1: FY2022 First Quarter Earnings Call
FY2022 First Quarter Earnings Call February 4, 2022 Adient – PUBLIC 1
Slide 2: Important Information
Important Information Adient has made statements in this document that are forward-looking and, therefore, are subject to risks and uncertainties. All statements in this document other than statements of historical fact are statements that are, or could be, deemed “forward- looking statements” withi
Slide 3: Agenda
Agenda > Introduction Mark Oswald VP, Treasurer & Investor Relations > Business Update Doug Del Grosso President and CEO > Financial Review Jeff Stafeil Executive VP and CFO > Q&A FY2022 First Quarter Earnings Call Adient – PUBLIC Feb. 4, 2022 3
Slide 4: Driving forward with focus while encouraging signs of stabilization emerge
Driving forward with focus while encouraging signs of stabilization for the industry emerge As expected entering FY22, numerous macro factors including supply chain signs of stabilization disruptions (and resulting operating inefficiencies), elevated commodity prices, Key Q1 FY22 Macro factors: incr
Slide 5: Macro environment remains challenging
Macro environment remains challenging As expected, the operating Trending Headwinds Q1FY22 Impact* environment in early FY22 > Supply chain disruptions (semiconductor and remains challenging. Despite petrochemical shortages) resulting in production “green shoots” of stabilization Early signs of down
Slide 6: Adient's commitment to sustainability
Adient’s commitment to sustainability Adient is committed to long-term sustainable transformation, which will continue to influence both our products and our operations. Our goal is not only to drive environmental change by lessening the impact our business has on the planet, but also to focus on so
Slide 7: Strengthening our leading position
Strengthening our leading position Adient continues to win new and replacement RAM 1500 Renault Arkana business in line with internal expectations and Complete Seat, Foam, Trim, with continued focus on sustainable / profitable Complete Seat Metals programs. In Q1, Adient was awarded the replacement
Slide 8: In process and upcoming launches
In process and upcoming launches Infiniti QX60 Launch execution continues to be an intense focus for Adient, Complete Seat and a key building block to winning new and replacement business. While the company is focused on launch processes, semiconductor shortages have challenged customer volumes in t
Slide 9: 2022 and beyond
2022 and beyond Well-positioned to capitalize on industry recovery - driving shareholder value INDUSTRY INFLUENCES > Underlying fundamentals of the auto industry remain strong: > Strong consumer demand (supply constrained vs. demand constrained) > Robust mix of vehicles being produced > Inventories
Slide 10: Financial Review
Financial Review FY2022 First Quarter Adient – PUBLIC
Slide 11: Q1 FY2022 Key Financials
Q1 FY2022 Key Financials As Reported As Adjusted 1 $ millions, except per share data Q1 FY22 Q1 FY21 Q1 FY22 Q1 FY21 B/(W) Consolidated $ 3,480 $ 3,848 3,480 $ 3,848 (10)% Revenue $3,975 Q1FY21 pro forma adjusted for EBIT $ 40 $ 282 61 $ 295 (79)% strategic/footprint actions Margin 1.1% 7.3% 1.8% 7.
Slide 12: Q1 FY2022 Revenue: Regional Performance
Q1 FY2022 Revenue: Consolidated and unconsolidated sales Regional Performance Consolidated sales (consolidated sales y-o-y growth (vs. Q1 FY21 pro forma) by region) 1, 2 $127 Q1 Q1 IHS Production $(422) $(73) Americas -12.6% -14.7% $3,848 $3,975 $3,480 EMEA -18.4% -26.6% Asia 7.2% -8.4% Note: China
Slide 13: Q1 FY22 Adjusted-EBITDA
Q1 FY22 Adjusted-EBITDA Q1FY22 adjusted EBITDA of $146M, down $179M y-o-y (adjusting for portfolio actions executed in FY21) $(53) > As expected entering the quarter, numerous macro factors including $ in millions $378 supply chain disruptions (and resulting operating inefficiencies) and $325 $(102)
Slide 14: Cash flow
Cash flow Free Cash Flow (1) Key drivers impacting Q1FY22 FCF: FY22 FY21 (in $ millions) Q1 FY22 Q1 FY21 (-) Lower y-o-y earnings (driven by lower volumes -- supply chain related) Adjusted-EBITDA $ 146 $ 378 (-) Timing and level of commercial settlements (+/-) Net Equity in Earnings (32) (93) (-) Lo
Slide 15: Debt and capital structure
Debt and capital structure Net Debt ($ in millions) 12/31/2021 Includes $625M December 31 September 30 Cash & Debt Profile Amount of proceeds (in $ millions) 2021 2021 Cash & Cash Equivalents $ 2,080 collected as final payment from Cash $ 2,080 $ 1,521 ABL Revolver, incl. FILO due 2024 (1) - the Chi
Slide 16: FY22 Outlook – key financial metrics
FY22 Outlook – key financial metrics Consolidated sales ~$14.8B > FY22 guidance updated to reflect Adient’s YTD No change results thru December 31, 2021, planned debt Modestly lower vs. FY21 pro Adj.-EBITDA forma results of $810M paydown and current market conditions No change > Consolidated sales o
Slide 17: Influences that could change the narrative on FY2022
Influences that could change the narrative on FY2022 Positive influences Negative influences > Faster–than-expected ramp in vehicle production (supply chain > Prolonged supply chain disruptions issues resolved or substantially > Instability in vehicle production (if improved) production ramps too fa
Slide 18: Appendix and financial reconciliations
Appendix and financial reconciliations FY 2022 First Quarter Adient – PUBLIC
Slide 19: Q1 FY22 Adjusted-EBITDA: Americas
Q1 FY22 Adjusted-EBITDA: Americas Despite improved launch performance and lower tooling, Q1FY22 of $9M, down $118M y-o-y (adjusting for portfolio business performance was significantly impacted by temporary actions executed in FY21) operating inefficiencies resulting from supply chain disruptions, >
Slide 20: Q1 FY22 Adjusted-EBITDA: EMEA
Q1 FY22 Adjusted-EBITDA: EMEA Q1FY22 of $43M, down $61M y-o-y (adjusting for $ in millions portfolio actions executed in FY21) > As expected entering the quarter, numerous macro factors including supply chain disruptions (and $114 resulting operating inefficiencies) and increased $2 $104 $4 freight
Slide 21: Q1 FY22 Adjusted-EBITDA: Asia
Q1 FY22 Adjusted-EBITDA: Asia Q1FY22 of $114M, up $1M y-o-y (adjusting for $ in millions portfolio actions executed in FY21) Key drivers of the y-o-y comparison: $151 > Increased volume and mix of about $14M (Adient customer mix benefited the quarter) $14 $113 $114 > The positive impact of improved
Slide 22: Non-GAAP financial measurements
Non-GAAP financial measurements Adjusted EBIT, Adjusted EBIT margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income attributable to Adient, Adjusted effective tax rate, Adjusted earnings per share, Adjusted equity income, Adjusted interest expense, Free cash flow and Net debt as well a
Slide 23: Non-GAAP Reconciliations - EBIT, Adj.-EBIT, Adj.-EBITDA, Adj.-Equity Income
Non-GAAP Reconciliations - EBIT, Adj.-EBIT, Adj.-EBITDA, Adj.-Equity Income, and Adj.-EBITDA excluding Adj.-Equity Income Three months ended December 31 2021 2020 (in $ millions) GAAP Adj. Adjusted GAAP Adj. Adjusted Net sales $ 3,480 $ - $ 3,480 $ 3,848 $ - $ 3,848 Cost of sales (1) 3,307 (1) 3,306
Slide 24: Non-GAAP Reconciliations - Adjusted Net Income and Adjusted EPS
Non-GAAP Reconciliations - Adjusted Net Income and Adjusted EPS Adjusted Net Income Adjusted Diluted EPS Three Months Ended Three Months Ended December 31 December 31 (in $ millions) 2021 2020 2021 2020 Net income (loss) attributable to Adient $ (54) $ 150 Diluted earnings (loss) per share as report
Slide 25: Non-GAAP Reconciliations - Adjusted Income before Income Taxes and Effective Tax Rate
Non-GAAP Reconciliations - Adjusted Income before Income Taxes and Effective Tax Rate Adjusted Income before Income Taxes Three Months Ended December 31 (in $ millions) 2021 2020 Income (loss) Income (loss) before Income Tax impact Effective before Income Tax impact Effective Taxes tax rate Taxes ta
Slide 26: Non-GAAP Reconciliations - Pro forma fiscal year 2021 reconciliations
Non-GAAP Reconciliations - Pro forma fiscal year 2021 reconciliations (in $ millions) Net Sales Q1 Q2 Q3 Q4 FY2021 Adjusted EBITDA Q1 Q2 Q3 Q4 FY2021 Americas - as reported: $ 1,737 $ 1,644 $ 1,440 $ 1,343 $ 6,164 Americas - as reported: $ 132 $ 64 $ 23 $ 13 $ 232 Americas footprint actions (20) - -
Slide 27: Segment Performance
Segment Performance Q1 2021 Q1 2022 Corporate/ Corporate/ Americas EMEA AP Consolidated Americas EMEA AP Consolidated Eliminations Eliminations Net Sales 1,737 1,604 554 (47) 3,848 1,498 1,230 784 (32) 3,480 Adjusted EBITDA 132 114 151 (19) 378 9 43 114 (20) 146 Adjusted Equity Income - 3 91 - 94 (1