Strattec Security Corporation · NASDAQ:STRT
Strattec Security — Sidoti & Company Presentation (November 2020)
37 slides from Strattec Security's conference presentation, Nov 19, 2020
Slide 1: Sidoti & Company
Sidoti & Company November 19, 2020 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 2: Disclosure for Presentation on November 19, 2020
Disclosure for Presentation on November 19, 2020 This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may include expected future financial results, product offerings, global expansion, liquidity needs, f
Slide 3: Frank J. Krejci, President & CEO
Frank J. Krejci (CRAY’ CHEE) President & CEO 3 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 4: Background Information
Background Information 4 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 5: STRATTEC – Facts & Figures
STRATTEC – Facts & Figures Headquarters: Milwaukee, Wisconsin Established: 1908 Formerly part of Briggs & Stratton Corporation Sales 600 Spun-off in February of 1995 487 500 Independent, publicly traded (NASDAQ) STRT 411 401 417 439 385 400 Employees: ~4,000 348 $M USD 298 300 261 279
Slide 6: Vehicle Access Systems Technology (VAST)
VEHICLE ACCESS SYSTEMS TECHNOLOGY (VAST) • Unique joint venture partnership (STRATTEC, ADAC, and WITTE) • Shared technology • Joint investments outside of our home markets of North America and Europe (China, India, and Brazil) • $1.7 billion + sales (STRATTEC, WITTE, ADAC, VAST China unconsolidated)
Slide 7: Sales by Customers and Products
Sales by Customers and Products Customers Products Fiat Chrysler Miscellaneous Automobiles Industrial Hyundai/Kia 1% 22% 5% Honda Driver Power Access 5% Controls & Latches 8% 29% Commercial OEM Service & Other & Aftermarket 11% OEMs 13% Tier 1 Customers Door Handles 15% General & Trim Components Mot
Slide 8: Facilities
Facilities Milwaukee, WI Auburn Hills, MI • STRATTEC Headquarters • STRATTEC Power Access HQ • Manufacturing • STRATTEC Sales Office • Engineering • Engineering • Testing • Program Management El Paso, TX (Distribution) SMO I SMO II ADAC STRATTEC de Mexico STRATTEC Mexico Operations - Juarez, Mexico
Slide 9: Patrick J. Hansen, Senior Vice President & CFO
Patrick J. Hansen Senior Vice President & CFO 9 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 10: Financial Information
Financial Information 10 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 11: Outlook Going Forward for Fiscal Year 2021
Outlook Going Forward for Fiscal Year 2021 • Net Sales during the 1st Quarter fiscal 2021 ended September 2020 were $126.0 million. Net sales will remain strong during the upcoming second quarter as we continue to replenish low dealer inventories. • The gross profit margin improvements were primaril
Slide 12: Statements of Income 1st Quarter September 2020 & 2019
Statements of Income 1st Quarter September 2020 & 2019 (in thousands of USD) Actual Actual % of Net % of Net QTR Sept. 2020 Sales QTR Sept. 2019 Sales Net Sales $ 126,234 $ 119,962 Cost of Goods Sold 103,723 82.2% 102,710 85.6% Non-Cash Compensation Expense 0 0% 1,366 1.1% * Gross Profit 22,511 17.8
Slide 13: 3 Year Net Sales Growth
3 Year Net Sales Growth (in millions $) $500 $487 $439 $400 $385 $300 $200 $120 $126 $100 $- FY 2018 FY 2019 FY 2020* FY 2020 FY 2021 (3 months) (3 months) *FY 2020 was impacted by General Motor UAW strike that reduced sales by $10 million and COVID-19 by $78 million. 13 VEHICLE ACCESS SYSTEMS TECHN
Slide 14: 3 Year Adjusted EPS and 1st Quarter FY2021
3 Year Adjusted EPS and 1st Quarter FY2021 $4.00 $3.39 $3.00 $2.84 $2.11 $2.00 $1.00 $0.79 $- $(1.00) $(2.00) $(2.04) $(3.00) FY 2018 FY 2019* FY 2020** FY 2020 FY 2021 (3 months) (3 months) adjusted *Adjusted for Non-Cash Pension Settlement and compensation charges of $36.0 million pre-tax. ** Net
Slide 15: 3 Year and 3 Month EBITDA Summary
3 Year and 3 Month EBITDA Summary $40 $35 $28.9 $30.1 $30 $25 $20 $15.2 $14.6 $15 $10.3 $10 $5 $- FY 2018 FY 2019 FY 2020 FY 2020 FY 2021 (3 months) (3 months) NOTE: The fiscal 2019 EBITDA was adjusted to add back the pre-tax/non-cash pension settlement charge of $31.8 million and non-cash compensat
Slide 16: Fiscal Year End Capital Spending and Depreciation Expense
4 Fiscal Year End Capital Spending Depreciation Expense and Projected FY 2021 (in millions $) $40 $37.0 $35 $30 $24.1 $25 $19.3 $20.0 $20 $14.6 $17.5 $17.2 Capital $15 $12.4 $12.0 Spending $11.4 $10 Depreciation $5 Expense $0 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 Projected NOTE: FY 2017 STRATTEC s
Slide 17: Fiscal Year End Debt Outstanding
3 Fiscal Year End Debt Outstanding and as of September 27, 2020 (in millions $) $60 $51.0 $50 $42.0 $40 ADAC STRATTEC $35.0 $28.0 ADAC $30.0 $30 STRATTEC ADAC $24.0 STRATTEC $17.0 ADAC STRATTEC $20 $17.0 STRATTEC $10 $23.0 STRATTEC STRATTEC STRATTEC $18.0 $18.0 $13.0 $0 FY 2018 FY 2019 FY 2020 FY 20
Slide 18: Capitalization as of September 27, 2020
Capitalization as of September 27, 2020, June 28, 2020, June 30, 2019 and July 1, 2018 (in millions $) September 27, 2020 June 28, 2020 June 30, 2019 July 1, 2018 Total Debt $30.0 $35.0 $42.0 $51.0 Less: Cash & Cash Equivalents ($12.0) ($11.8) ($7.8) ($8.1) Total Net Debt $18.0 $23.2 $34.2 $42.9 Sha
Slide 19: Frank J. Krejci, President & CEO
Frank J. Krejci (CRAY’ CHEE) President & CEO 19 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 20: Product Information
Product Information 20 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 21: Core Products: Security Products
Core Products: Security Products Locksets & Keyfobs Start Systems, Column Locks (mechanical and electrical) 21 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 22: Core Products: Access Products
Core Products: Access Products Latch Products Power Access Systems 22 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 23: Industry Leading Technology
Industry Leading Technology • Winner of two PACE awards in 2018 and 2019 and 2020 GM Innovation award (one of four awarded worldwide) • STRATTEC’s innovation provided the Power Tailgate solution allowing GM to be first to market with this feature. This option has been the focus of GM’s ad campaign t
Slide 24: Power Tail Gate Sales Content Opportunity
Power Tail Gate Sales Content Opportunity • Chevrolet Silverado projected consumer take rate 15%- 20% at the time of product launch September 2019. Current take rate is in excess of 20%. • Ford F-series Pickups projected consumer take rate 15%- 20% at the time of product launch September 2020. • Opp
Slide 25: Vehicle Access Systems Technology
Vehicle Access Systems Technology d/b/a VAST Automotive Group 25 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 26: Vehicle Access Systems Technology
VEHICLE ACCESS SYSTEMS TECHNOLOGY Founded 1899 Founded 1908 Founded 1975 HEADQUARTERS: HEADQUARTERS: HEADQUARTERS: Velbert, Germany Milwaukee, Wisconsin, U.S. Grand Rapids, Michigan, Privately-held Publicly-traded U.S. EMPLOYEES: 4,000 (STRT Nasdaq) Privately-held Company LOCATIONS: EMPLOYEES: 4,000
Slide 27: VAST China
• VAST China is a strategic market for VAST with significant growth in the future when our Jingzhou, China paint and assembly facility is past its startup phase in calendar years 2021 and 2022. • VAST China’s major customers are Volkswagen, General Motors, Volvo, and Ford with additional opportuniti
Slide 28: China
China In Millions Of US Dollars $200 $180 $174.2 $161.0 $160 $152.0 $140 $128.2 $123.2 $120 $111.8 $114.0 $100 $92.4 $78.0 $76.3 $80 $67.7 $60 $37.2 $37.5 $40 $21.6 $20 $10.1 $8.9 $14.6 $4.0 $- 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 28 VEHICLE ACCES
Slide 29: Summary
Summary • Product Growth primarily in Power Access Products (Power End Gates with General Motors Chevrolet Silverado and FORD F-150 Pickup Trucks). • Financially strong Balance Sheet & Cash Flow • Defined Benefit Pension Obligation behind us • Working to Improve Gross Profit Margins through Cost Red
Slide 30: Questions?
Questions? 30 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 31: Appendix
Appendix 31 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 32: Balance Sheet (September 2020)
Balance Sheet (September 2020, in thousands of USD) September 27, 2020 June 28, 2020 (Unaudited) ASSETS Current Assets: Cash and cash equivalents $ 11,983 $ 11,774 Receivables, net 79,764 41,955 Inventories, net 51,673 54,400 Other current assets 17,527 17,239 Total Current Assets 160,947 125,368 In
Slide 33: Cash Flow Statement YTD September 2020 & 2019
Cash Flow Statement YTD September 2020 & 2019 (in thousands of USD) YTD YTD Sept 2020 Sept 2019 Cash Flows From Operating Activities: Net Income $ 10,073 $ 2,680 Adjustments to Reconcile Net Income to Cash Provided by Operating Activities: Depreciation 4,885 4,733 Loss (Gain) on Investment in LLC (8
Slide 34: Vehicle Access Systems Technology
34 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
Slide 35: VAST Formed: 2000
VAST Formed: 2000 - Milwaukee, Wisconsin- Founded 1908, Public Company 1995. - Velbert, Germany – Founded 1899, Private - Grand Rapids, Michigan– Founded 1975, Private - 33% Ownership by STRATTEC (2001) - 51% Ownership by STRATTEC (2006) - 80% Ownership by STRATTEC (2008) - 16.6% Ownership by STRATT
Slide 36: Global Presence
GLOBAL PRESENCE Germany 57 - 10 1-4 France 9 6-7 11 Czech Republic 1-3 8 12 Bulgaria 12 11 United States 18 1013 Manufacturing Sites 4 5 India 15 14 1 U.S., Milwaukee 6 1317 2 U.S., Grand Rapids Mexico 3 U.S., Saranac 4 U.S., Muskegon (3) 5 Mexico, Juarez (3) Engineering Centers 6 Mexico, Leon 1 U.S
Slide 37: VAST Customers
VAST Customers Passenger Vehicle Manufacturers Commercial Vehicle Manufacturers System Suppliers 37 VEHICLE ACCESS SYSTEMS TECHNOLOGY WITTE • STRATTEC • ADAC
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