Nfi Group Inc. · TSX:NFI
Nfi — Investor Presentation (August 2016)
19 slides from Nfi's investor presentation, Aug 11, 2016
Slide 1: NFI Investor Update Q2-2016
0 NFI Investor Update Q2-2016 North America’s leading Transit Bus and Motor Coach Manufacturer and Parts Distributor August 11, 2016 Forward Looking Statements and Non-GAAP Measures are defined in APPENDIX B.
Slide 2: NFI Investment Thesis
1 + NFI Investment Thesis North Americas’ #1 heavy duty transit bus brand, #1 motor coach brand and #1 Leading Share in aftermarket parts and service supplier Diversified >70,000 vehicles (transit buses and motor coaches) currently in service with Markets ~50% share of Canadian and US installed base
Slide 3: Company Overview
2 Company Overview Q2-16 LTM Highlights: Revenue: US $1.92 B Adj EBITDA: US $229.3 M Return on Sales: 11.9% • North America’s #1 Transit Bus & Motor Coach manufacturer and parts supplier with the leading installed base of ~50% of transit buses Net Debt: $573 M and motor coaches currently in service
Slide 4: Optimize, Defend, Diversify & Grow
3 + NFI Business Strategy Our Facilities, Our Market Our Business Our Revenue, Processes & Leading Positions and Revenue EBITDA and Products in Bus/Coach/Parts Stream CashFlow Optimize, Defend, Diversify & Grow 1. Offer Canadian and US operators the best buses, services and value in the industry Mig
Slide 5: NFI Strategic Plan and Execution has delivered solid TSR
4 NFI Strategic Plan and Execution has delivered solid TSR Total Shareholder Return(1) Cultural & Structural Change 700.0 663.6 Adopted Stakeholder Model. Commitment to Culture, People & LEAN operations 600.0 Migrated Capital Structure from Income Deposit Security (yield only focus) Common Share (Gr
Slide 6: #1 Market Share in Transit Bus
5 #1 Market Share in Transit Bus Heavy-Duty: Xcelsior® Medium-Duty: MiDi® Launch in 2009 based on >20 years experience with JV with Alexander Dennis (UK) to introduce MiDi® to low floor transit buses North America in 2014 Offered in 35’, 40’, and 60’ lengths 30’ and 35’ low-floor medium duty bus, te
Slide 7: Transit Bus Market Segments in Canada and US
6 Transit Bus Market Segments in Canada and US Transit Market Segments 24 of the 25 largest Transit Agencies and primary targets operate NF supported transit buses Metropolitan Urban Municipal Fleets Fleets Fleets 900+ Operators 17 operators 200 operators 39% of installed fleet 45% of installed flee
Slide 8: #1 Market Share in Motor Coaches
7 #1 Market Share in Motor Coaches New Coach – Private New Coach – Public Pre-Owned Coach Targets the mid-range to luxury segments Targets the mid-range segment Trade-in option to support new coach sales J Model is the #1 selling coach in the N.A. “Buy America” compliant Coaches are refurbished at M
Slide 9: Motor Coach Market in Canada and US
8 Motor Coach Market in Canada and US Market Segments and primary targets Private Market Segment Definitions Fixed Route/ Tour & Transit Conversion Line Haul Charter 12% of 2% of 34% of 52% of installed fleet installed fleet installed fleet installed fleet Public Private Private Private Source: MCI
Slide 10: Annual Deliveries and Market Demand
9 + Annual Deliveries and Market Demand Transit Bus EUs delivered in Can/US Motor Coaches delivered in Can/US 7000 6,236 7000 6,032 5,933 5,816 5,388 5,373 5,347 5,284 6000 5,212 Total 5,154 5,128 5,109 5,065 6000 5,009 5,010 4,797 4,723 4,333 Industry 5000 4,047 5000 4000 2,990 4000 2,824 2,485 2,3
Slide 11: Public Customers Book-to-Bill and Backlog
10 + Public Customers Book-to-Bill and Backlog Book-to-Bill >100% for 13 of last 14 Quarters Total Backlog (Firm and Options) Includes MCI backlog Note: US Customer deferred Order was removed from backlog IN 2013 following 5 years of inaction.
Slide 12: Most comprehensive Parts & Support Services in the industry
11 + Most comprehensive Parts & Support Services in the industry Aftermarket Parts Product Support Services Widest transit bus and motor coach product Publications: Wide range of customized parts, assortment and industry leading distribution network maintenance and operational documentation. New wit
Slide 13: Manufacturing, Parts & Service Footprint
12 + Manufacturing, Parts & Service Footprint MCI - Winnipeg, MB NFI - Winnipeg, MB Parts Fabrication, MCI D Model Shell Assembly Parts Fabrication and Bus Shell Assembly Complete J Model manufacture New Product Development New Product Development Parts Distribution AB Montreal, PQ SK MB MCI Service
Slide 14: Environmental Commitment: Green Propulsion Options
13 + Environmental Commitment: Green Propulsion Options Clean Diesel Natural Gas Electric-Trolley Hybrid-Electric Battery-Electric Clean Natural Electric Hybrid All Diesel Gas Trolley Electric Electric Xcelsior MiDi D Model J Model Additional propulsion options currently being evaluated for NFI MiDi
Slide 15: Financial Performance
14 + Financial Performance Sales ($M US) Return on Invested Capital 250 0 ROIC = Net operating profit after tax Average invested capital for the period 1,924 200 0 14.0% 14.0% 1200 1,451 1,539 363 12.2% 12.0% 8.5% 1000 150 0 1,199 322 10.0% 8.6% 319 800 865 Millions 215 8.0% 100 0 6.2% 600 119 1,561
Slide 16: Cash Flow Performance
15 + Cash Flow Performance 2016 Q2 LTM Adjusted EBITDA to Free Cash Flow ($M) 250 229.3 Millions 35.6 191.9 200 20.3 156.3 150 39.2 11.1 2.5 100 50 - Free Cash Flow and Dividends ($M C) 250.0 191.9 200.0 NFI Annual Dividend 150.0 108.3 Increased 35.7% from $.70/share to $.95/share 100.0 65.5 on May
Slide 17: Debt and Total Leverage
16 + Debt and Total Leverage Total Leverage Ratio does not include Convertible Debenture as debt. Under NFI Senior Credit Agreement Total Debt ($US M) Total Leverage must be maintained Total Leverage Ratio below 4X Adj EBITDA $1,000 3.5 $900 3 $26M Convertible Debenture $800 issued in Jun-12 @ 6.25%
Slide 18: Canadian and US Bus Market Segments
17 APPENDIX A Canadian and US Bus Market Segments Approx Annual Bus Type Deliveries (EUs) NFI Strategic Actions School Bus ~30,000 - 35,000 since 2011 Cutaways MiDi JV with (Truck Chassis based) ~15,000 - 18,000 ADL to diversify Invest in OpEx Acquired TCB Medium Duty 2 Convert Capital Transit and S
Slide 19: Forward Looking Statements, Financial Terms, Definitions and Conditions
18 APPENDIX B + FORWARD LOOKING STATEMENTS, FINANCIAL TERMS, DEFINITIONS AND CONDITIONS FORWARD LOOKING STATEMENTS This investor presentation contains forward-looking statements relating to expected future events, including the integration of the acquired business into New Flyer’s existing business