Linamar Corporation · TSX:LNR

Linamar — Q1 2022 Earnings Presentation

70 slides from Linamar's earnings presentation, May 2022

Slide 1: Linamar Corporation Investor Presentation
Linamar Corporation Investor Presentation A Diversified Global Powerhouse in Advanced Manufacturing May 2022
Slide 2: Forward Looking Information, Risk and Uncertainties
Forward Looking Information, Risk and Uncertainties Certain information regarding Linamar set forth in this presentation and oral summary, including management’s assessment of the Company’s future plans and operations may constitute forward-looking statements. This information is based on current ex
Slide 4: Linamar - A Leading Global Advanced Manufacturing Company
Linamar - A Leading Global Advanced Manufacturing Company © Linamar Corporation 4
Slide 5: Linamar 2100: Market Focus Addresses Key Global Trends
Linamar 2100: Market Focus Addresses Key Global Trends Mobility Infrastructure Food Power Water Age Rapid Technology Growing Intensity Urbanization Growing Global Aging Global Evolution to Address Population Population Environmental Concerns © Linamar Corporation 5
Slide 6: Core Brands and Diverse Markets
Core Brands and Diverse Markets Diversified Manufactured Products that Power Vehicles, Motion, Work and Lives Infrastructure Mobility Food © Linamar Corporation 6
Slide 7: Linamar's Unique Value Creation Model
Linamar’s Unique Value Creation Model Deeply Interconnected Businesses Driving Value Across Multiple Vectors Global Footprint Independent Businesses Purchasing Value Connected © Linamar Corporation 7
Slide 8: Key Drivers of Market Opportunity
Key Drivers of Market Opportunity 8
Slide 9: Key Business Strategies
Key Business Strategies Mobility Skyjack MacDon Linamar MedTech ▪ Increase electrified content ▪ Laser focus on growth in China ▪ Expand product lineup ▪ Focus on contract ▪ Power Generation ▪ Globalize and expand product lineup in ▪ Focus on crop protection and manufacturing for precision ▪ Energy
Slide 10: Market Concentration Balance
Market Concentration Balance Industrial Mobility Sales Sales Mobile Industrial Equipment | Fabricated Assemblies Engine | Transmission | Driveline | Body 22% 78% ACCESS AGRICULTURAL AUTOMOTIVE OFF HIGHWAY COMMERCIAL 12.4 10.1 71.7 2.2 3.6 These Market Concentration Balances are YTD supplementary fin
Slide 11: Diverse Core Capabilities
Diverse Core Capabilities Metal Forming Machining & Assembly Robotic Welding Advanced Automation & Robotics Laser cutting CNC Expertise Metal Forming Complex Assemblies Stamping Hydroforming Painting Heat Treatment Assembly Forging Light Metal Casting Hatebur High Speed Hot Horizontal Forging Gravit
Slide 12: Strong Global Footprint
Strong Global Footprint CANADA 24 UNITED KINGDOM 1 GERMANY 7 HUNGARY 5 CHINA 5 Global Headcount 25,500 Manufacturing Facilities (60) Sales Offices (25) R&D Centres (11) Support Facilities (5) USA 5 MEXICO 5 SPAIN 1 FRANCE 4 BULGARIA 1 INDIA 2 57 Facilities with IATF 16949 12 Facilities with ISO 9001
Slide 13: ESG is a Long Held Priority
ESG is a Long Held Priority Environment Social Governance ▪ Green technology is a key growth strategy driving ▪ Diversity Drives Results Initiative ▪ Detailed review of every governance policy conducted product innovation in all business ▪ 18% female leaders vs 19% female workforce yearly with Board
Slide 14: Linamar Long Term Sustainability Roadmap & Goals
Linamar Long Term Sustainability Roadmap & Goals We commit to being a net zero emissions organization inclusive of the operation of our facilities, our supply base and the products we supply to by 2050. Our Goal: Our Commitment: Net Zero Facilities Net Zero Supply Chain Net zero Net Zero Customer Pr
Slide 15: Diversity: Key Principles
Diversity: 4 Key Principles Opportunity for Everyone Proportionate Representation Advance on Merit No Quotas Why? Maximizes Talent Pool Logical Optimizes Performance 15
Slide 16: Women in STEM Website and Calendar
Women in STEM Website and Calendar We are featuring nearly 300 female role models in STEM on our Website We have distributed nearly 70,000 calendars in the past 4 years https://www.seeitbeitstemit.com/about-the-calendars
Slide 18: Broad Innovation Strategy
Broad Innovation Strategy Product Development Manufacturing Partnerships Digitization through AI/ML Innovation Compete and Win Tangential Innovation Innovation Material Innovation has many facets – to Development succeed we need to tap into Lighter, innovation in all its forms Stronger Process Devel
Slide 19: Innovation Driving Green Technologies, Digitization & Operational Efficiency
Innovation Driving Green Technologies, Digitization & Operational Efficiency Underpinning Strategy in Each Business Green Technologies Digitization Operational Efficiency © Linamar Corporation 19
Slide 20: Business Strategies Impact Product Design & Facility Function
Business Strategies Impact Product Design & Facility Function Mobility Medical Green Technologies PRODUCT Electrification & Compact & Energy Electrification Precision Agriculture Emission Reduction Efficient FACILITY Technology Investments to Reduce Facility Carbon Footprint Digitization & Operation
Slide 21: Joint Technology Development Initiatives and Manufacturing Partnerships
Joint Technology Development Initiatives and Manufacturing Partnerships Who Focus Technology Equity Green Technologies Ballard Fuel Cell Electrification “Plug & Play” FCEV Powertrain Rolling Joint Development & Selling Pass Car Chassis Solutions Class 1 and 2 Truck Gear Box & Inverter E-axle Solutio
Slide 22: Linamar's AI Roadmap
Linamar’s AI Roadmap Improve quality of production, Reduce cycle times, improve Eliminate routine tasks to enable focus on enhance product life and functionality uptime to lower costs, improve more interesting work driving career and to improve performance, make more productivity, drive faster wage
Slide 23: AI/ML Driving Innovation & Efficiencies
AI/ML Driving Innovation & Efficiencies ADVANCED ROBOTICS DATA COLLECTION VISION SYSTEMS ADDITIVE PREDICTION & MANUFACTURING ANALYSIS Development of advanced 1. Improve equipment uptime & Evolving vision systems to collaborative robots to drive tool life & reduce cycle times more accurately gauge &
Slide 24: Digitization with AI/ML and Our Digitization Journey
Digitization with AI/ML and Our Digitization Journey April 2022 61 Category Counts by Quarter 6000 20000 Traceability 18000 Connected Digital Asset Count by Category 5000 Total Connected Digital Assets Marking 16000 4000 Stations 14000 12000 3000 10000 8000 2000 6000 4000 1000 2000 0 0 2,456 Q1/18 Q
Slide 26: Q1 2022: Performance Highlights
Q1 2022: Performance Highlights Focus on Customers Focus on Employees Focus on Financial 2022 Theme: 2022 Theme: 2022 Theme: Sustainable Growth Diversity AI Adoption ▪ Strong underlying market demand in all businesses, ▪ Key initiatives launched from Diversity Council ▪ Double digit sales and EPS gr
Slide 27: Sales, Normalized Earnings, and Margins (in millions CAD)
Sales, Normalized Earnings1, and Margins (in millions CAD) Q1 2022 Q1 2021 %Δ Q1 2022 The key impacts to the segments vs prior The key factors impacting results in the year are: Sales 1,778.1 1,781.9 (0.2%) quarter are: Mobility Industrial Sales 368.2 348.3 5.7% ▪ Massively higher costs in material,
Slide 28: Market Snapshot
Market Snapshot Commercial Combine Commercial 2022 Light Vehicle Truck Heads Access 2023 Light Vehicle Truck Access North North America ▲13.0% ▲18.6% ▲10.0% ▲12.0% America ▲ 11.8% ▼-7.4% ▲9.8% Europe Europe ▲3.8% ▲5.8% ▲5.0% ▲13.7% ▲11.0% ▲8.5% ▲9.3% Asia ▲1.3% ▼-19.0% n/a ▲9.9% Asia ▲7.2% ▼-5.8% ▲1
Slide 29: Outlook
Outlook Consolidated Normal Ranges 2021 Actuals Expectations 2022 Expectations 2023 Q2 22 Expectations Sales Growth 12.4% Double Digit Growth Double Digit Growth 1 ▪ Mobility Normalized EPS Growth 35.8% Double Digit Growth Double Digit Growth ▪ Customer vehicle build losses will continue to weigh on
Slide 31: Skyjack focuses on maximizing customer utilization and return on investment
Skyjack focuses on maximizing customer utilization and return on investment by proudly providing them quality-engineered, simple and reliable access & material handling solutions on a global basis. © Linamar Corporation 31
Slide 32: China Market Entry
China Market Entry ▪ Investment agreement with Binhai New Area announced in March 2022. ▪ Skyjack’s Electric DC Scissor lift models utilizing space and resources in Linamar’s existing Tianjin facility. © Linamar Corporation 32
Slide 33: Industrial Segment Impacts - Skyjack
Industrial Segment Impacts - Skyjack Access Industry YTD Results & Forecast Access Equipment Market Commentary % Change vs. Prior Year ▪ Supply chain disruptions including shipping container shortages and higher commodity prices are continuing to negatively impact production, shipments and costs in
Slide 34: Access & Material Handling Equipment
Access & Material Handling Equipment MOBILE EQUIPMENT MARKET PRODUCT MIX MOBILE EQUIPMENT MARKET GEOGRAPHIC MIX $10,000 $20,000 $10,000 $20,000 $9,000 $18,000 $9,000 $18,000 SEGMENT MARKET SIZE $Millions (USD) - LINES SEGMENT MARKET SIZE $Millions (USD) - LINES TOTAL MARKET SIZE $Millions (USD) - BA
Slide 35: Skyjack Market Share
Q1 2014 Q1 2014 Q2 2014 Q2 2014 Q3 2014 Q3 2014 Q4 2014 Q4 2014 Q1 2015 Q1 2015 Q2 2015 Q2 2015 Source: Skyjack Internal, April 2022. Q3 2015 Q3 2015 Q4 2015 Q4 2015 Q1 2016 Q1 2016 Q2 2016 Q2 2016 Q3 2016 Q3 2016 Q4 2016 Q4 2016 Q1 2017 Q1 2017 Q2 2017 Q2 2017 Q3 2017 Q3 2017 Q4 2017 Q4 2017 Q1 201
Slide 36: Skyjack's Innovation Strategy
Skyjack’s Innovation Strategy QR Code Info Access Next Generation Alternative Power Mobile Apps Digital Products Innovation Smart machines Secondary Battery Management System Guarding © Linamar Corporation 36
Slide 38: Acquisition of Salford Group to Expand Agricultural Portfolio
Acquisition of Salford Group to Expand Agricultural Portfolio ▪ April 27th, 2022, Linamar announced an agreement to acquire 100% ownership of the Salford Group of companies for $260M CAD. ▪ Salford is a global leader in crop nutrition application and tillage products. ▪ This acquisition expands Lina
Slide 39: MacDon is the world leader in harvesting equipment
MacDon is the world leader in technology, innovation, and manufacturing of high- performance harvesting equipment. © Linamar Corporation 39
Slide 40: Agricultural Market
Agricultural Market Agriculture Market Commentary North American Combine Retails ▪ Supply chain disruptions including shipping container shortages and higher commodity 1,600 prices are continuing to negatively impact production, shipments and costs in 2022. ▪ Agriculture retailers are seeing very le
Slide 41: Key Market Strategies and Growth
Key Market Strategies and Growth Farming income, cash receipts, and combine retails indicate a positive outlook for 2022 farming equipment orders. Food $4,000 $3,500 Global Market Combine Heads ($CAD) ▪ Build on MacDon acquisition as the foundation from $3,000 $2,500 which to expand global ag busine
Slide 42: MacDon Strategy
MacDon Strategy Portfolio Expansion | Advanced Technologies | Geographic Expansion | World-class Product Support | Laser Focused Operations © Linamar Corporation 42
Slide 44: Key Market Strategies - Flexible & Opportunistic
Key Market Strategies - Flexible & Opportunistic Actual IHS Markit Forecast Advanced Consensus Projection 120 Pure Battery EV penetration 100 reaches 50% of the market by 2040 80 Millions 60 40 20 Mobility - 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 20
Slide 45: Semiconductor Chip Shortage – Light Vehicle Production Impact
Semiconductor Chip Shortage – Light Vehicle Production Impact Announced volume loss of 1.6M units YTD. Supply disruption expected to continue into 2023. Announced Volume Loss by Quarter Announced Volume Loss by Region 4.0 3.48 6.0 4.94 3.5 3.0 2.60 2.5 2.06 4.0 2.87 2.76 Millions Millions 2.0 1.44 1
Slide 46: US Light Vehicle Inventory – Days' Supply
US Light Vehicle Inventory – Days’ Supply Will Take Years To Replenish Inventory Levels Regardless of Demand… Change vs Same Period Last 180 Year 160 Overall -8 140 GM 7 120 Ford 2 100 80 Stellantis 1 60 Toyota -2 40 Honda -28 20 8574727668726970647171618474687264686568657572618877687664676661667367
Slide 47: Global Light Vehicle Market: Q1 2022, Q2 2022, and 2022
Global Light Vehicle Market: Q1 2022, Q2 2022, and 2022 Q1 2022 production decreased by 0.4M units. Q2 2022 forecast decreased by 1.8M units. 2022 full-year forecast decreased by 3.5M. ▪ Q1 2022 forecast decreased by 0.4M ▪ Q2 2022 forecast decreased by 1.8M ▪ 2022 full-year outlook decreased by 3.5
Slide 48: Electrification Product Solutions
Electrification Product Solutions Develop new electrification product solutions leveraging existing resources Leverage Electrification Support All Support Existing Existing Customers Strategies eLIN Groups & Resources Globally Develop electrification strategies Plants Win New Business Win new busine
Slide 49: Diverse Electrification Strategy Maximizes Potential
Diverse Electrification Strategy Maximizes Potential 1 Diverse Products ▪ Propulsion System ▪ Structural and Chassis ▪ Power Generation ▪ Power Storage Diverse Vehicle Types ▪ Pass car, CUV/SUV, Light truck ▪ Commercial vehicles ▪ Trucks Class 1-8 ▪ Off road vehicles 2 5 Scalable Solutions ▪ Individ
Slide 50: Innovation: Rolling Chassis Demonstrator
Innovation: Rolling Chassis Demonstrator ▪ A significant showcase of Linamar’s Electrified Mobility Capabilities on display this week at the ACT Expo in California ▪ Linamar’s eLIN Product Solutions Group exhibiting systems solutions in; ▪ Full Scale Hydrogen Fuel Cell Powered Class 2 Truck Chassis
Slide 51: Strategic Alliance with Ballard Power Systems
Strategic Alliance with Ballard Power Systems A Partnership to Develop Fuel Cell Solutions for Light-Duty Vehicles ▪ Framework Agreement to initially co-develop a fuel cell powertrain solution demonstration platform ▪ In a secondary phase, the parties will move towards a formal Joint Venture focused
Slide 52: Content Per Vehicle (CPV)
Electrified Vehicles Key Growth Opportunity for Linamar $80 $70 $60 Content Per Vehicle (CPV) $50 $40 $30 $20 $10 $0 2015 2016 2017 2018 2019 2020 2021 2022 2023 Electric Hybrid ICE Updated: April 19, 2022. Estimates based on current projections and EV applications in market. 52
Slide 53: Flexible Manufacturing Strategy
Flexible Manufacturing Strategy ▪ Capital assets currently employed in Linamar’s operations can be adapted to manufacture electrified components at little to no incremental CAPEX ▪ For instance, the same gear grinding equipment can produce gears for eAxles and ICE powertrains alike ▪ This advantage
Slide 54: Innovation in Process Development for Light Metal Castings
Innovation in Process Development for Light Metal Castings ▪ Lightweight aluminum casting capabilities are evolving to increase the Structural and Chassis portfolio Structural & Chassis Products EV Motor Housings & Electric Drive Units (EDUs) Cases © Linamar Corporation 54
Slide 55: Acquired Casting Assets Strengthen Growth Platform for Structural Content
Acquired Casting Assets Strengthen Growth Platform for Structural Content ▪ Linamar Acquires Partner’s Interest in GF Linamar April 1, 2022 ▪ Strengthens growth platform in Structural content, a key part of Future of Mobility strategy and 1 of the 4 key pillars of the eLIN Product Solutions Group St
Slide 57: Strategy & Recent Developments
Strategy & Recent Developments ▪ As a global diversified manufacturer, Linamar’s 2100-year plan identifies Age Management & Medial Devices as a long-term strategic market of which to enter into ▪ In December of 2019, made an initial small equity investment in Synaptive Medical, an innovative medical
Slide 58: Synaptive Medical Manufacturing Partnership
Synaptive Medical Manufacturing Partnership Modus V™ Evry™ ▪ Automated Robotic digital microscopy ▪ Magnetic Resonance Imaging (“MRI”) with excellent imagery, minimal infrastructure & lower operating cost ▪ 3D capability for ideal surgical visualization ▪ Low magnetic field and small footprint ▪ Imp
Slide 60: Cash Flow Continued Positive
Cash Flow Continued Positive ▪FCF1 in Q1 $3.7 million despite the 1,300 40% 1,170 36% seasonal working capital uptick of Q1 1,040 32% ▪ 16th consecutive quarter of positive FCF ▪Liquidity1 excellent with $1.9 billion of 910 28% 780 24% cash available at quarter end; and $ Millions ▪Solid liquidity a
Slide 61: Annual Sales
Annual Sales CAGR 10 Year 8.6% 9,000.0 30 Year 14.0% 8,000.0 7,000.0 6,000.0 $ Millions 5,000.0 4,000.0 3,000.0 2,000.0 1,000.0 6,546.5 7,620.6 7,416.6 5,815.6 6,536.6 1,781.9 1,778.1 - 2017 2018 2019 2020 2021 Q1 2021 Q1 2022 Annual Results Current Quarter © Linamar Corporation 61
Slide 62: Net Earnings - Normalized
Net Earnings - Normalized1 600 12.0% 500 10.0% 8.9% 8.4% 7.7% 400 8.0% 6.6% 6.3% $ Millions 300 5.4% 6.0% 200 4.0% 4.0% 100 2.0% 551.5 583.8 464.4 314.6 428.4 158.3 70.9 - 0.0% 2017 2018 2019 2020 2021 Q1 2021 Q1 2022 Annual Results Current Quarter Normalized NE as a % of QTR Sales 1 - Net Earnings
Slide 63: Operational Capital Expenditures
Operational Capital Expenditures 600 18.0% 500 15.0% 400 12.0% $ Millions 300 9.0% 200 7.1% 7.1% 6.0% 6.3% 4.9% 4.5% 100 3.7% 3.0% 3.3% 88.0 410.1 537.3 525.4 264.3 243.1 59.6 - 0.0% 2017 2018 2019 2020 2021 Q1 2021 Q1 2022 Annual Results Current Quarter Capex as a % of YTD Sales Capex as % of Sales
Slide 64: Net Debt to EBITDA
Net Debt to EBITDA1 2.50x 2.00x 1.50x 1.00x 0.50x 0.31x 0.83x 1.68x 1.50x 0.50x 0.00x -0.13x -0.12x -0.50x 2017 2018 2019 2020 2021 Q1 2021 Q1 2022 Current Quarter Net Debt x EBITDA Target 1 - EBITDA includes trailing twelve months EBITDA on acquisitions, when applicable. 2020 Net Debt to EBITDA was
Slide 65: Thank You
Thank You www.linamar.com @linamarcorp Linamar Corporation
Slide 67: Diverse Key Products
Diverse Key Products Industrial Mobility New Energy Powertrain Body & Chassis Systems Engine Driveline Transmission © Linamar Corporation 67
Slide 68: Skyjack Products
Skyjack Products Vertical Mast Lifts DC Scissor Lifts RT Scissor Lifts Vertical mast lifts with platform heights from DC and micro scissor lifts with platform heights Rough terrain scissor lifts with platform heights 12’ (3.6m) up to 20’ (5.9m) from 13’ (3.9m) to 40’ (12m) from 26’ (7.92m) to 64’ (1
Slide 69: MacDon Products
MacDon Products R2 Series Rotary Disc Header C Series Corn Headers D1 & FD1 Series Pick-Up Headers R1 Series Pull-Type M1 Series Windrower © Linamar Corporation 69
Slide 70: Linamar well positioned to provide content on ICE, Hybrid and EV platforms
Today & In Future: Linamar well positioned to Engine Camshafts Cast and Cubed / Fully Lower Engine Connecting Turbo Camshaft / Cylinder Head Balance Shaft Machined Cylinder Crankcase Assembly Rods Charger Cover Module Modules Blocks & Heads Assemblies provide content on ICE, Hybrid and EV platforms

Linamar — Q1 2022 Earnings Presentation on 6ix

Linamar — Q1 2022 Earnings Presentation

Slide 1: Linamar Corporation Investor Presentation

Slide 2: Forward Looking Information, Risk and Uncertainties

Slide 3: Company Overview

Slide 4: Linamar - A Leading Global Advanced Manufacturing Company

Slide 5: Linamar 2100: Market Focus Addresses Key Global Trends

Slide 6: Core Brands and Diverse Markets

Slide 7: Linamar's Unique Value Creation Model

Slide 8: Key Drivers of Market Opportunity

Slide 9: Key Business Strategies

Slide 10: Market Concentration Balance

Slide 11: Diverse Core Capabilities

Slide 12: Strong Global Footprint

Slide 13: ESG is a Long Held Priority

Slide 14: Linamar Long Term Sustainability Roadmap & Goals

Slide 15: Diversity: Key Principles

Slide 16: Women in STEM Website and Calendar

Slide 17: Innovation

Slide 18: Broad Innovation Strategy

Slide 19: Innovation Driving Green Technologies, Digitization & Operational Efficiency

Slide 20: Business Strategies Impact Product Design & Facility Function

Slide 21: Joint Technology Development Initiatives and Manufacturing Partnerships

Slide 22: Linamar's AI Roadmap

Slide 23: AI/ML Driving Innovation & Efficiencies

Slide 24: Digitization with AI/ML and Our Digitization Journey

Slide 25: Quarter Highlights

Slide 26: Q1 2022: Performance Highlights

Slide 27: Sales, Normalized Earnings, and Margins (in millions CAD)

Slide 28: Market Snapshot

Slide 29: Outlook

Slide 30: Infrastructure

Slide 31: Skyjack focuses on maximizing customer utilization and return on investment

Slide 32: China Market Entry

Slide 33: Industrial Segment Impacts - Skyjack

Slide 34: Access & Material Handling Equipment

Slide 35: Skyjack Market Share

Slide 36: Skyjack's Innovation Strategy

Slide 37: Food & Agriculture

Slide 38: Acquisition of Salford Group to Expand Agricultural Portfolio

Slide 39: MacDon is the world leader in harvesting equipment

Slide 40: Agricultural Market

Slide 41: Key Market Strategies and Growth

Slide 42: MacDon Strategy

Slide 43: Mobility

Slide 44: Key Market Strategies - Flexible & Opportunistic

Slide 45: Semiconductor Chip Shortage – Light Vehicle Production Impact

Slide 46: US Light Vehicle Inventory – Days' Supply

Slide 47: Global Light Vehicle Market: Q1 2022, Q2 2022, and 2022

Slide 48: Electrification Product Solutions

Slide 49: Diverse Electrification Strategy Maximizes Potential

Slide 50: Innovation: Rolling Chassis Demonstrator

Slide 51: Strategic Alliance with Ballard Power Systems

Slide 52: Content Per Vehicle (CPV)

Slide 53: Flexible Manufacturing Strategy

Slide 54: Innovation in Process Development for Light Metal Castings

Slide 55: Acquired Casting Assets Strengthen Growth Platform for Structural Content

Slide 56: Linamar 2100: MedTech

Slide 57: Strategy & Recent Developments

Slide 58: Synaptive Medical Manufacturing Partnership

Slide 59: Financial Review

Slide 60: Cash Flow Continued Positive

Slide 61: Annual Sales

Slide 62: Net Earnings - Normalized

Slide 63: Operational Capital Expenditures

Slide 64: Net Debt to EBITDA

Slide 65: Thank You

Slide 66: Appendix

Slide 67: Diverse Key Products

Slide 68: Skyjack Products

Slide 69: MacDon Products

Slide 70: Linamar well positioned to provide content on ICE, Hybrid and EV platforms