Slide 1: Full-Year and Q4 2019 Results
Full - Year and Q4 2019 Results February 27, 2020 Exhibit 99.2
Slide 2: Forward-Looking Statements
2 Forward - Looking Statements Statements in this presentation that are not historical facts are forward - looking statements, which involve risks and uncertaint ies that could cause actual events or results to differ materially from those expressed or implied by the statements. Important factors th
Slide 3: Overview of Achievements
3 Overview of Achievements x 3 Additional OEM MirrorEye awards – Total peak annual revenue of awarded business $76 million at ~15% blended take - rates x 2 Additional OEM MirrorEye awards in the 4 th Quarter - $50 million of peak annual revenue at modest take rate assumptions x The customer platform
Slide 4: 2019 Was a Year of Transformation
4 2019 Was a Year of Transformation Investment in transformation continues to position Stoneridge for long - term profitable growth ▸ Continued transformation in 2019 set the stage for future performance and growth • Rationalized product portfolio • Exited switches and connectors business • Initiate
Slide 5: Financial Summary: Quarterly Comparison 2018 vs 2019
5 Quarterly Comparison* 2018 vs 2019* Adjusted Sales Adjusted Gross Profit Adjusted Operating Income Adjusted EBITDA Financial Summary Externalities, including the GM strike and negative impact of foreign currency, as well as increased costs related to the closure of our Canton facility, impacted Q4
Slide 6: 2019 Q4 Summary
6 2019 Q4 Summary Externalities and other non - recurring costs, including facility closure costs, impacted Q4 performance Quarter - over - Quarter Sales Comparison* Quarter - over - Quarter Adjusted Operating Income Comparison* ▸ Excluding the impact of shift - by - wire, the GM strike and currency
Slide 7: 2020 Margin Guidance
7 2020 Margin Guidance 2019 Adjusted Gross Margin* Reduced Electronic Component Costs Expecting $2 - $3 million in 2020 savings 27.2% Investment in Engineering Resources and SG&A 28.0% - 29.0% +130 bps vs. 2019 2020 Gross Margin Guidance We expect midpoint margin improvement of approximately 130 bas
Slide 8: Leadership Announcement
8 Leadership Announcement Kevin Heigel joins Stoneridge as Vice President of Operations focused on driving world class operations and implementing best practices to drive manufacturing excellence ▸ Kevin Heigel joined Stoneridge as Vice President of Operations effective January 10 th ▸ Kevin is resp
Slide 9: MirrorEye Update
9 MirrorEye Update MirrorEye OEM ▸ Awarded largest MirrorEye program to date with global OEM (3rd award) • $46 million peak annual revenue (~10% take - rate in North America and ~25% in Europe) • Start of Production – 2023 ▸ Awarded additional North American OEM program (4th award) • $4 million peak
Slide 10: Commitment to Long-Term Profitable Growth
10 Commitment to Long - Term Profitable Growth Updating 2021 revenue target to reflect current market conditions and MirrorEye expectations Improved outlook for MirrorEye based on customer expectations of increasing take rates Previously Provided 2021 Revenue Target Production Volume Forecasts ~$1 b
Slide 11: Advanced Technology Investment and Opportunity
11 0 2 4 6 8 10 12 14 16 18 2017 2018 2019 2020 2021 2022 2023 2024 Investment (In Millions) Advanced Technology Investment and Opportunity We have invested in recent years to develop advanced technologies and platforms. We expect significant growth opportunities starting in 2020 as a result of thos
Slide 12: Leveraging Our Existing Technology Portfolio for What's Next
12 Leveraging Our Existing Technology Portfolio for What’s Next Commercial vehicles have increased needs for advanced safety and efficiency tools which align with our current capabilities and future product roadmap V2X ▸ V2V cooperative warnings ▸ Extended range sensing Video Recording and Transmiss
Slide 13: Summary
13 Summary 2019 Summary ▸ Optimized product portfolio ▸ Optimized manufacturing footprint ▸ Investment in improved systems and technology ▸ Significant business awards, including largest MirrorEye award to date, positioned the Company for long - term growth ▸ Continued investment in advanced technol
Slide 14: Financial Update
Financial Update Ssevertve
Slide 15: 2019 Summary and Q4 2019 Financial Results
15 2019 Summary 4 th Quarter 2019 Financial Results Excluding divested product lines, sales of $183.9 million, a decrease of 8% over Q4 2018 • Excluding divested product lines, Control Devices sales of $93.5 million, a decrease of 6% over Q4 2018 • Electronics sales of $80.5 million, a decrease of 1
Slide 16: Control Devices Financial Performance
16 Control Devices Financial Performance Continued focus on operational improvement expected to drive margin improvement in 2020 Control Devices 2020 Expectations Excluding the impact of the continued ramp - down of shift - by - wire, revenue expected to grow 3 - 5% in 2020 • Weighted average end -
Slide 17: Electronics Financial Performance
17 Electronics Financial Performance Challenging commercial vehicle production forecasts in Europe and North America expected in 2020 Gross margin improvement offset by investment to support product development and launches Electronics 2020 Expectations Revenue expected to decline in 2020 driven by
Slide 18: Stoneridge Brazil Financial Performance
18 Stoneridge Brazil Financial Performance Expecting stabilized market conditions and OEM launch to lead to stable revenue performance Margin expansion expected based primarily on improved gross margin Stoneridge Brazil 2020 Expectations Revenue expected to remain approximately flat in 2020 based on
Slide 19: 2020 Full Year Volume Outlook
19 Weighted OEM end - markets expected to decline (2.2%) in 2020 *Excluding Orlaco and Stoneridge Brazil ** Regional sales based on manufactured location and estimated end - market exposure *** Management estimates Total Passenger Car / Light Truck OE 41% Commercial Vehicle OE 33% Aftermarket / Non
Slide 20: China Coronavirus Update
20 China Coronavirus Update Guidance includes minimal impact due to Coronavirus in China as sales and material exposures are expected to be relatively limited Overview ▸ Recently relocated operations to a fully owned facility in Suzhou ▸ Quarantine and travel restrictions in place throughout China a
Slide 21: 2020 Sales Guidance
21 2020 Sales Guidance 2019 Adjusted Drivers of 2020 Sales Guidance MirrorEye Retrofit and New Program Launches Divested Product Lines $830m IHS and LMC Production Forecasts Weighted Average (2.2%) $750m - $770m 2020 Guidance 2020 Sales expected to decline by (4%) relative to 2019 sales (excluding d
Slide 22: 2020 Adjusted EPS Guidance
22 Investment in Engineering Resources and SG&A 2020 Adjusted EPS Guidance 2019 Adjusted Drivers of 2020 Adjusted EPS Guidance $1.47 $0.95 - $1.15 2020 Guidance Midpoint adjusted EPS guidance of $1.05 driven by a normalized tax rate, reduced revenue expectations offset by operational improvements, a
Slide 23: Backlog Awarded Business: 2020 – 2024
23 Backlog Awarded Business: 2020 – 2024 Excluding divested product lines and external factors, backlog grew by 6.7% in 2020 Based on January 2020 IHS; Q3 2019 LMC, Company Data and Management estimates Based on Management estimates and current pricing agreements on awarded programs MirrorEye take r
Slide 24: Capital Structure / Share Repurchase Update
24 Capital Structure / Share Repurchase Update We will continue to utilize our available capital to maximize shareholder return through inorganic opportunities as well as return of capital to shareholders Net Debt / Adjusted EBITDA 0.7x 0.2x 0.7x Net Debt and Leverage Ratio Current net debt / adjust
Slide 25: Summary
25 Summary 2019 Summary ▸ Control Devices – Excluding the continued ramp - down of legacy shift - by - wire programs and the GM strike, the base portfolio grew by 7.2% in 2019. Operating performance, especially in the 4 th quarter, resulted in margin contraction of 150 basis points vs. 2018. ▸ Elect
Slide 26: Appendix
Appendix Ssevertve
Slide 27: Primary Stoneridge Foreign Currency Sensitivities
27 Primary Stoneridge Foreign Currency Sensitivities SRI Currency Exposures 2020 Assumption Rates If 5% Weaker vs. USD N et Annual EBITDA * Transaction Impact Translation Impact Euro 1.09 Mexican Peso 19.97 N/A Chinese Yuan 7.18 Swedish Krona 9.76 Brazilia n Real 4.17 *Before impact of hedging progr
Slide 28: Income Statement
28 Income Statement Year ended December 31 (in thousands, except per share data) Net sales $ 834,289 $ 866,199 $ 824,444 Costs and expenses: Cost of goods sold 620,556 609,568 576,304 Selling, general and administrative 123,853 138,553 141,893 Gain on disposal of non-core products, net (33,599) - -
Slide 29: Segment Financial Information
29 Segment Financial Information Year ended December 31 Net Sales: Control Devices $ 431,560 $ 441,297 $ 447,528 Inter-segment sales 6,438 8,348 5,044 Control Devices net sales 437,998 449,645 452,572 Electronics 335,195 344,727 282,383 Inter-segment sales 33,735 37,126 39,501 Electronics net sales
Slide 30: Balance Sheet
30 Balance Sheet CONSOLIDATED BALANCE SHEETS December 31, (in thousands) ASSETS Current assets: Cash and cash equivalents $ 69,403 $ 81,092 Accounts receivable, less reserves of $1,289 and $1,243, respectively 138,564 139,076 Inventories, net 93,449 79,278 Prepaid expenses and other current assets 2
Slide 31: Statement of Cash Flows
31 Statement of Cash Flows CONSOLIDATED STATEMENTS OF CASH FLOWS Year ended December 31 (in thousands) OPERATING ACTIVITIES: Net income $ 60,291 $ 53,848 $ 45,049 Adjustments to reconcile net income to net cash provided by (used for) operating activities: Depreciation 24,904 22,786 21,490 Amortizati
Slide 32: Statement of Cash Flows (Cont.)
32 Statement of Cash Flows (Cont.) CONSOLIDATED STATEMENTS OF CASH FLOWS Year ended December 31 (in thousands) FINANCING ACTIVITIES: Acquisition of noncontrolling interest, including transaction costs - - (1,848) Revolving credit facility borrowings 112,000 27,500 95,000 Revolving credit facility pa
Slide 33: Reconciliations to US GAAP
33 Reconciliations to US GAAP
Slide 34: Reconciliations to US GAAP
34 Reconciliations to US GAAP This document contains information about Stoneridge's financial results which is not presented in accordance with accounting principles generally accepted in the United States ("GAAP"). Such non - GAAP financial measures are reconciled to their closest GAAP financial me
Slide 35: Reconciliations to US GAAP
35 Reconciliations to US GAAP (USD in millions) Q1 2018 Q2 2018 Q3 2018 Q4 2018 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2019 Gross Profit 68.0 67.4 63.3 58.0 256.6 60.9 56.8 51.9 44.2 213.7 Add: Pre-Tax Restructuring Costs 1.3 2.4 2.5 1.5 7.6 Less: Pre-Tax One-Time Sale of Non-Core Product Inventory (1
Slide 36: Reconciliations to US GAAP
36 Reconciliations to US GAAP (USD in millions) Q1 2018 Q2 2018 Q3 2018 Q4 2018 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2019 Control Devices Operating Income 17.9$ 17.2$ 16.3$ 12.9$ 64.2$ 11.9$ 44.4$ 9.8$ 7.2$ 73.3$ Add: Pre-Tax Restructuring Costs 2.2 3.5 3.6 3.0 12.2 Less: Pre-Tax Gain from Disposal
Slide 37: Reconciliations to US GAAP
37 Reconciliations to US GAAP (USD in millions) Q1 2018 Q2 2018 Q3 2018 Q4 2018 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2019 Sales 225.9$ 220.6$ 208.9$ 210.8$ 866.2$ 218.3$ 222.2$ 203.4$ 190.4$ 834.3$ Less: Pre-Tax One-Time Sale of Non-Core Product Inventory (4.2) (4.2) Adjusted Sales 225.9$ 220.6$ 208
Slide 38: Reconciliations to US GAAP
38 Reconciliations to US GAAP (USD in millions) Q1 2018 Q2 2018 Q3 2018 Q4 2018 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2019 Adjusted Operating Income 17.9$ 17.3$ 16.3$ 12.9$ 64.3$ 14.7$ 12.9$ 13.3$ 10.4$ 51.3$ Less: Pre-Tax Gain from Disposed Non-Core Products (2.4) (2.3) (2.3) (2.0) (9.1) (2.0) - (1.
Slide 39: Reconciliations to US GAAP
39 Reconciliations to US GAAP (USD in millions) Q4 2019 Q4 2019 EPS Net Income Attributable to Stoneridge 4.2$ 0.15$ Add: After-Tax Step-Up in Fair Value of Earn-Out (PST) 0.4 0.02 Add: After-Tax Restructuring Costs 2.6 0.09 Less: After-Tax Gain in Fair Value of Equity Investment 0.2 0.01 Add: After
Slide 40: Reconciliations to US GAAP
40 Reconciliations to US GAAP (USD in millions) 2019 Income Before Tax 68.4$ Add: Pre-Tax Step-Up in Fair Value of Earn-Out (PST) 2.3 Less: Pre-Tax Change in Fair Value of Equity Investment 0.2 Add: Pre-Tax Restructuring Costs 13.4 Add: Pre-Tax Share-Based Comp Accelerated Vesting 0.7 Add: Pre-Tax B