Cooper-standard Holdings Inc. · NYSE:CPS
Cooper-standard — Deutsche Bank Leveraged Finance Conference 2015
36 slides from Cooper-standard's conference presentation, Sep 30, 2015
Slide 1: Deutsche Bank Leveraged Finance Conference September 30, 2015
1 Deutsche Bank Leveraged Finance Conference September 30, 2015
Slide 2: Forward-Looking Statements
2 2 Forward-Looking Statements There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained in this presentation. Important factors that could cause the Company's actual results to differ materially from the forw
Slide 3: Passion for Performance
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Slide 4: Cooper Standard Investment Thesis
4 4 Cooper Standard (NYSE:CPS) Investment Thesis 1. The Company is beginning to realize the anticipated benefits of a long-term corporate transformation 2. Recently implemented world-class operations initiative and Cooper Standard Operating System (CSOS), including best business practices tools, are
Slide 5: Passion for Performance
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Slide 6: Company Overview
6 6 Company Overview 2014 Revenue: $3.244 billion (52% NA, 35% Europe, 8% Asia, 5% SA) $400+ million nonconsolidated JV Automotive Supplier Rank1: 67 Globally 41 North America 49 Europe Global Footprint: 97 facilities 10 technical centers 20 countries Employees: 27,000 + employees 1 Automotive News
Slide 7: Core Products Lines
7 7 Core Products Lines Fuel & Brake Delivery Systems #2 Globally1 Fluid Transfer Systems North American Leader1 Anti-Vibration Systems North American Leader1 1 Booz and Company Market Research 2013 Sealing Systems #1 Globally1
Slide 8: Revenue Breakout by Product Line
8 8 Revenue Breakout by Product Line Fuel & Brake Delivery Systems #2 Globally1 Fluid Transfer Systems North American Leader1 Anti-Vibration Systems North American Leader1 *6% other includes non-automotive and divested thermal & emissions products 1 Booz and Company Market Research 2013 Sealing Syst
Slide 9: Market Size and CPS Estimated Share
9 9 Market Size and CPS Estimated Share Fuel & Brake Delivery Systems #2 Globally1 Fluid Transfer Systems North American Leader1 Anti-Vibration Systems North American Leader1 1 Booz and Company Market Research 2013 2 Estimate based on IHS light vehicle production data and average content per vehicle
Slide 10: Passion for Performance
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Slide 11: Vision: Drive for Profitable Growth
11 Vision : Drive for Profitable Growth Mission : Top 30 – Top 5 Cooper Standard (NYSE: CPS) Top 30 automotive supplier in sales; top 5% ROIC
Slide 12: Drive for Profitable Growth
12 12 Drive for Profitable Growth
Slide 13: Winning Global Platforms - Imperative
13 13 0 2 4 6 8 10 12 14 16 18 20 2010 2015 2021 Lt. V eh ic le P rod u ction ( milli o n s) Regional Global Winning Global Platforms - Imperative 49% 51% 35% 65% 23% 77% North American Framework Shifted - Global Platforms Accelerated After 2010 65% of light vehicles produced in North America are
Slide 14: CPS Top Platforms – Global Vehicles
14 14 CPS Top 20 Platforms – 10 Global Vehicles Sealing Fuel & Brake Delivery Fluid Transfer Systems Anti-Vibration Systems Ford F-150 / Expedition / Navigator GM Silverado / Sierra / Tahoe / Yukon / Escalade Ford Focus / Escape / C-Max / Kuga / V40 Ford Fiesta / Ecosport / B-Max / Transit Courier F
Slide 15: Optimizing Global Footprint – 2015
15 15 Optimizing Global Footprint – 2015 • European Improvement Initiatives progressing as planned • Finalized acquisition of Huayu-Cooper Standard (Shenya) Sealing • Advancing Cooper Standard INOAC FTS joint venture • Added two new production facilities in China • New sales and engineering office i
Slide 16: World-Class Operations
16 16 World-Class Operations • Launched world-class operations initiative to drive improvement in ROIC: – Advantaged global footprint – Established and implemented Cooper Standard Operating System (CSOS) o Standardization of process, equipment and product designs – Implemented best business practice
Slide 17: CPS Benchmark World-Class Operations – BBP Dashboard
17 17 CPS Benchmark World-Class Operations – BBP Dashboard Material Variable Overhead Fixed Overhead Total Labor Hours / Equivalent Unit CPS Benchmark Opportunity for Improvement CPS Benchmark CPS Benchmark
Slide 18: Manufacturing Quality Improvement
18 18 Manufacturing Quality Improvement CSOS Initiatives Drive Operating Improvement Overall Equipment Effectiveness Safety Improvement 2014 2015 (2Q YTD) 34% 2014 2015 (2Q YTD) +200 bps 2014 2015 (2Q YTD) 58%
Slide 19: Restoring Competitive Advantage in Europe
19 19 2 2 Restoring Competitive Advantage in Europe New regional management in place to accelerate performance Vertical integration Addressing commercial gaps Footprint optimization Revised restructuring plan Acquired 100 percent interest in Cooper Standard France JV Re-entered Spain m
Slide 20: Expanding in High-growth Markets
20 20 Expanding in High-growth Markets Huayu-Cooper Standard (Shenya) acquisition Places Cooper Standard as largest automotive sealing supplier in China Cooper Standard / INOAC JV Majority-owned JV in Asia to accelerate fluid transfer systems growth Provides additional growth opportunities
Slide 21: 2Q 2015 Revenue by Region
21 21 2Q 2015 Revenue by Region Asia Pacific Revenue Growth Accelerating Growth in Asia North America 53% Europe 31% South America 3% $58 $112 2Q 2014 2Q 2015 (USD millions) +92% Asia Pacific 13%
Slide 22: Bringing Innovations to Market
22 22 Bringing Innovations to Market Ultra Pro Coat High-performance Coating Quick Connect with Sensor ArmorHose™ Fortrex™
Slide 23: Passion for Performance
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Slide 24: 2Q 2015 Financial Results
24 24 2Q 2015 Financial Results Second Quarter 2014 2015 Sales $857.6 $860.8 Gross Profit 146.1 154.0 % Margin 17.0% 17.9% SGA&E 81.9 84.1 % Margin 9.5% 9.8% Operating Profit 56.5 58.8 % Margin 6.6% 6.8% Other Income/(expense) (28.6) 2.1 Adjusted EBITDA(1) $91.8 $97.0 % Margin 10.7% 11.3% Net Income
Slide 25: Continued Margin Expansion
25 25 Continued Margin Expansion • Consolidated adjusted EBITDA margin(1) of 11.3 percent – best in 3 years • North America segment profit margin improved 130 bps year over year* • Europe segment profit margin improved 190 bps year over year** * Excluding allocated loss on extinguishment of debt in
Slide 26: Adjusted EBITDA Margin Improvement
26 26 Last 4 Quarters Adjusted EBITDA Margin Trend Line Adjusted EBITDA Margin Improvement 6% 7% 8% 9% 10% 11% 12% 3Q 2014 4Q 2014 1Q 2015 2Q 2015
Slide 27: 2Q 2015 Balance Sheet and Liquidity
27 27 2Q 2015 Balance Sheet and Liquidity Note: In USD millions except ratios. Numbers subject to rounding Liquidity Cash Balance as of March 31, 2015 $ 194.4 Cash generated 10.4 Cash Balance as of June 30, 2015 $ 204.8 ABL Revolver 180.0 Letters of Credit (33.1) Total Liquidity $ 351.7 Key Financia
Slide 28: Company Outlook
Company Outlook
Slide 29: Revenue 2012 - 2017
29 29 Revenue 2012 - 2017 $2.0 $2.5 $3.0 $3.5 $4.0 $4.5 2012 2013 2014 2015F 2016F 2017F Driving for Profitable Growth Key Growth Drivers • Positioning to outpace competition on global platforms • Gaining significant China and North America market share • Developing new strategic partnerships • Comm
Slide 30: Driving for Profitable Growth in 2015
30 30 Driving for Profitable Growth in 2015 • Driving cash flow improvements • Capturing margin improvement through CSOS • Marketing innovations • Managing headwinds • Pursuing strategic acquisitions
Slide 31: 2015 Guidance
31 31 2015 Guidance Initial Guidance Feb. 25, 2015 Current Guidance July 30, 2015 Revenue $3.3 - $3.4 billion Unchanged Capital Expenditure $185 - $210 million $175 - $185 million Cash Restructuring $35 - $45 million $25 - $35 million Cash Tax $45 - $55 million $40 - $50 million Adj. EBITDA Margin 5
Slide 32: Passion for Performance
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Slide 33: Passion for Performance
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Slide 34: Non-GAAP Financial Measures
34 34 Non-GAAP Financial Measures EBITDA and adjusted EBITDA are measures not recognized under Generally Accepted Accounting Principles (GAAP) which exclude certain non-cash and non-recurring items. Management considers EBITDA and adjusted EBITDA as key indicators of the Company's operating performa
Slide 35: Adjusted EBITDA Reconciliation
35 35 2014 2015 2014 2015 13.2$ 36.5$ 32.9$ 57.5$ 4.4 16.4 16.5 31.2 10.9 9.3 25.9 18.4 28.5 29.4 56.8 56.0 57.0$ 91.6$ 132.1$ 163.1$ Gain on acquisition (1) - (2.6) - (14.2) Loss on extinguishment of debt (2) 30.3 - 30.5 - 3.8 7.4 6.7 26.2 - - - 1.4 0.7 - 2.8 - Acquisition costs - 0.4 - 1.0 - 0.2 0
Slide 36: Adj. EBITDA Reconciliation Twelve Months Ended June 30, 2015
36 36 Note: Numbers subject to rounding Adj. EBITDA Margin Twelve Months Ended June 30, 2015 (1) Includes non-cash restructuring and is net of noncontrolling interest. (2) Impairment charges related to fixed assets of $24.6 million and intangible assets of $1.7 million. (3) Gain on sale of thermal a
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