Eastern Company (the) · NASDAQ:EML
Eastern Company (the) — The Eastern Company — Investor Presentation (January 2021)
21 slides from Eastern Company (the)'s investor presentation, January 2021
Slide 1: Investor Presentation January 2021
NASDAQ: EML Investor Presentation January 2021 © 2020 The Eastern Company 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements in this document about our future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and the rules, regulations and relea
Slide 3: Statement on Non-GAAP Measures
Statement on Non-GAAP Measures This presentation includes certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”) such as Adjusted Earnings Per Share, Adjusted EBITDA, and Free Cash Flow and certain ratios and other metrics derived there from. Ad
Slide 4: Compelling Value Creation
Compelling Value Creation Grow and build Allocate capital scale in our three to maximize core businesses – returns to capitalizing on shareholders accelerators Generate cash Maintain a flow from more strong balance efficient and less sheet with ample capital intensive flexibility operations © 2020 T
Slide 5: A Portfolio of Scalable Core Businesses
A Portfolio of Scalable Core Businesses Leading provider of engineered turnkey packaging as well as blow mold and injection blow mold tooling serving diverse markets, including: truck, automotive, packaged consumer goods and pharmaceuticals. Global manufacturer and designer of access hardware system
Slide 6: Diversified End-markets
Diversified End-markets • Recession-resistant demand • Cyclical demand driven by freight • Driven by new product launches and miles, government regulations packaging redesign Consumer and Class 8 • Long sales cycles and program life • Concentrated packaging production and pharma OEM • Highly concent
Slide 7: A Track Record of Strong Sales Growth
A Track Record of Strong Sales Growth Net Sales 2015-2019 Sales growth ($ millions) (Percent of growth) 251.7 248.7 Acquired Organic** 234.3 204.2 +15% CAGR $144.6 137.6 LOADNLOCK 2015 2016 2017 2018 2019 2020 LTM* * Last twelve months ending October 3, 2020 ** Organic sales represents the sum of
Slide 8: Focus on Cash Generation
Focus on Cash Generation Cash generation Cash from operations ($ millions) Free cash flow*** 27.1 +26% CAGR 23.0 21.6 17.5 +28% CAGR 12.4 12.9 11.2 $9.1 9.5 9.3 8.4 6.6 2015* 2016 2017 2018 2019 LTM 2020** * Average annual cash from operations between 2010-2015 was $9.2 million ** Last twelve months
Slide 9: Earnings and Capital Efficiency Drive Cash Flow
Earnings and Capital Efficiency Drive of Cash Flow 2015-2019 change in free cash Net working capital Capital intensity flow* Percent of sales Percent of operating cash flow $ millions 31.2% 30.2% -4.5% $2.5 $2.9 $3.8 28.0% 27.9% 27.4% -7.1% 27.0% 25.0% 26.3% 25.8% $7.5 23.4% 23.5% $17.5 20.3% $6.6 D
Slide 10: Big 3 Precision: Capitalizing on New Product Launches
Big 3 Precision: Capitalizing on New Product Launches Returnable Packaging • Industry leader in returnable packaging solutions for manufacturers. • Highly engineered, value-added product offering. • Manufacturing automation requires integrated material handling systems. • Frequency of new vehicle la
Slide 11: Eberhard Manufacturing: Digitizing Vehicular Hardware
Eberhard Manufacturing: Digitizing Vehicular Hardware • Industry leader in domestic vehicular hardware solutions for commercial vehicle and vehicle accessory manufacturers. • Strong recurring sales from participation in leading OEM programs. • Highly engineered, value-added product offering, support
Slide 12: Velvac: Leading Vision for Commercial Vehicles
Velvac: Leading Vision for Commercial Vehicles • Leader in commercial vehicle vision system design and production. • Strong recurring sales to very long-term commercial vehicle programs – average program life more than 10 years. • Well positioned to continue to grow and consolidate vision system opp
Slide 13: A Bias For Action
A Bias For Action January January 2017 2016 New August November August Vlak leadership April 2017 June 2018 2019 July 2020 2020 appointed appointed at Acquisition Acquisition Acquisition Acquisition Consolidation President & Eberhard of Velvac of Load N of Big 3 of Hallink of Eberhard CEO and ILC In
Slide 14: Next Steps for Eastern
Next Steps for Eastern Build scale at Big 3 Precision (including synergies with 1 Hallink) and at Eberhard (combination with Illinois Lock) Invest in compelling M&A growth opportunities, seeking 2 additional bolt-on acquisition opportunities. Our goal to become Ramp organic growth by taking advantag
Slide 15: Financial Summary – FY 2016 to LTM 10/2020
Financial Summary – FY 2016 to LTM 10/2020 $ millions except per share data 2020 FY 2016 FY 2017 FY 2018 FY 2019 LTM** LTM Sales $137.6 $204.2 $234.3 $251.7 $248.7 2015-LTM 2020 % y-o-y growth (4.8%) 48.4% 14.7% 7.5% 3.8% CAGR = 12.1% Gross Profit $36.3 $51.0 $58.7 $61.9 $58.7 % sales 26.4% 25.0% 25
Slide 16: Reconciliation of GAAP to Non-GAAP EPS
Reconciliation of GAAP to Non-GAAP EPS Three Months Ended Nine Months Ended Twelve Months Ended December 31, 2016 December 30, 2017 December 29, 2018 December 28, 2019 December 28, 2019 October 3, 2020 October 3, 2020 Net Income as reported per generally accepted accounting principles (GAAP) $ 7,785
Slide 17: Reconciliation of Expenses from GAAP to Non-GAAP EBITDA
Reconciliation of Expenses from GAAP to Non-GAAP EBITDA Three Months Ended Nine Months Ended Twelve Months Ended December 31, 2016 December 30, 2017 December 29, 2018 December 28, 2019 December 28, 2019 October 3, 2020 October 3, 2020 Net Income/(loss) as reported per generally accepted accounting p
Slide 18: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow Three Months Ended Nine Months Ended Twelve Months Ended December 31, 2015 December 31, 2016 December 30, 2017 December 29, 2018 December 28, 2019 December 28, 2019 October 3, 2020 October 3, 2020 Net Cash Provided by Operating Activities $ 9,133,429 $ 12,415,240 11,
Slide 19: Reconciliation Footnotes
Reconciliation Footnotes A. Argo earnout reversal B. Environmental remediation expense related to the metal products segment C. Charge to Cost of Goods Sold relating to purchase accounting for the Velvac acquisition D. Personnel expenses related to the Security Segment E. Expense incurred in the acq
Slide 20: Financial Summary – Balance Sheet
Financial Summary – Balance sheet $ millions; as of October 3, 2020 Assets • Our balance sheet remains strong. Cash $19.6 Receivables $34.4 • Based on our extensive scenario planning, we Inventory $49.4 believe that Eastern's balance sheet has ample Prepaid Expenses $4.5 Current Assets $107.9 resour
Slide 21: The Eastern Company Corporate Office
The Eastern Company Corporate Office 112 Bridge Street P.O. Box 460 Naugatuck, Connecticut Phone: (203) 729-2255 [email protected] © 2020 The Eastern Company 21
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