Linamar Corporation · TSX:LNR

Linamar — Q2 2024 Earnings Presentation

47 slides from Linamar's earnings presentation, August 2024

Slide 1: Investor Presentation
Investor Presentation August 2024 Linamar Corporation A Global Powerhouse in Diversified Advanced Manufacturing
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 at a glance
Linamar Corporation is an advanced manufacturing and product development company where the intersection of Over leading-edge technology and deep manufacturing Founded: August 17th, 1966 Headquarters: Guelph, ON, Canada 34,000 Employees expertise is creating solutions that power vehicles, motion, wor
Slide 5: Market Focus Addresses Key Global Trends
Market Focus Addresses Key Global Trends Rapid Technology Growing Intensity to Aging Global Growing Global Address Environmental Urbanization Evolution Population Population Concerns © Linamar Corporation 5
Slide 7: Global Operating Structure
Global Operating Structure *eLIN Electrified Product Portfolio is included inside the McLaren Engineering Division © Linamar Corporation 7
Slide 8: Diverse Core Manufacturing Capabilities
Diverse Core Manufacturing 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
Slide 9: Broad Innovation Strategy
Broad Innovation Strategy Material Manufacturing Product Process Development Partnerships with Digitization Tangential Development Development Lighter, Stronger Tech Startups through AI/ML Innovation 9 © Linamar Corporation 9
Slide 11: 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 Customer Products Ne
Slide 12: Linamar's Unique Value Creation Model
Linamar’s Unique Value Creation Model Deeply Interconnected Businesses Driving Value Across Multiple Vectors © Linamar Corporation 12
Slide 13: Balanced & Diversified Business Model
Linamar’s Powerful Balanced & Diversified Business Model The Mobility segment, with its global reach and advanced capabilities, supports the Industrial segment by providing expertise and resources, while the Industrial segment, focused on North America, generates cash and shares brand management kno
Slide 14: Linamar Consistently Delivers, Year After Year
Linamar Consistently Delivers, Year After Year Note: Years in which Double Digit Growth in Sales or Normalized Net Earnings is denoted by a star. 1 - Free Cash Flow (FCF) and Net Earnings (NE) – Normalized are Non-GAAP Financial Measures. Please refer to “Non-GAAP and Other Financial Measures” in th
Slide 15: Q2 2024 Quarter Highlights
Q2 2024 Quarter Highlights
Slide 16: Quarter Highlights
Agenda Quarter Highlights - Excellent quarter financially with continued strong double-digit growth - Market share growth across all businesses - CPV up in every region - Great continued market share growth in core scissors globally at Skyjack - Great continued market share growth in core combine dr
Slide 17: Financial Highlights
Financial Highlights
Slide 18: Financial Highlights
Agenda Financial Highlights Q2 2024 • Double Digit Top & Bottom-Line Growth • Sales $2.85 Billion, up 12% • Normalized EPS1 $3.06, up 17% • Net Normalized Margin2 Expansion vs Prior Year reached 6.6% • Excellent Mobility Segment Earnings Growth of 59% and Margin Growth to 6.4% 1 - Net Earnings (Loss
Slide 19: Mobility Normalized Earnings and Margins
Mobility Normalized Earnings and Margins (in millions CAD) 140 6.5% 120 5.5% 100 4.5% Normalized Earnings Margin (%) Normalized Earnings ($M) 80 3.5% 60 2.5% 40 1.5% 20 0.5% - -0.5% Q3 2023 Q4 2023 Q1 2024 Q2 2024 OE - Normalized OE - Normalized Margin Linear (OE - Normalized) 1 – Operating Earnings
Slide 20: Financial Highlights: Income Statement
Financial Highlights 11,000 10,000 Sales Income Statement (in millions CAD) 9,000 8,000 7,000 Q2 2024 Q2 2023 %Δ TTM2 2024 TTM2 2023 %Δ $ Millions 6,000 5,000 Sales 2,848.7 2,552.8 11.6% 10,458.7 9,003.6 16.2% 4,000 3,000 2,000 NE – Normalized1 188.4 160.8 17.2% 606.5 503.0 20.6% 1,000 0 NE – Normal
Slide 21: Financial Highlights: Cash Flow and Investment
Financial Highlights 700 Consistent Positive Free Cash Flow Cash Flow and Investment (in millions CAD) 600 Q2 2024 Q2 2023 TTM2 2024 TTM2 2023 500 400 $ Millions Free Cash Flow1 67.1 56.1 (13.0) 180.3 300 200 Capital Expenditures (Capex) 174.0 205.4 758.4 605.8 100 Capex as a % of Sales 6.1% 8.0% 7.
Slide 22: Mobility
MOBILITY MOVE THE WORLD
Slide 23: 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 25: Innovation: eLIN eAxle Product Family
Innovation: eLIN eAxle Product Family Light Duty Light Duty Beam Utility Duty Beam Medium Duty Beam Independent eAxle eAxle eAxle eAxle Vehicle Class Vehicle Class Vehicle Class Vehicle Class 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 ▪ Linamar’s eLIN Product Solutions Group fin
Slide 26: Structures and Chassis Portfolio
Structures and Chassis Portfolio Knuckles Control Arms Structural Opportunities in Light Metals Crossmembers Subframe Sidemembers Subframe Components ▪ Increasing opportunities in Electrified and Propulsion Agnostic product, mitigating potential risk of ICE exposure in a transitioning Mobility marke
Slide 27: Mobility: Strategy & Operations Highlights
Agenda Mobility: Strategy & Operations Highlights Highlights ▪ Integrations of Dura-Shiloh and Mobex Global are near completion ▪ Using the new technologies and expanded portfolio ▪ More than $150M of New Projected 2028 Sales for Light Vehicles by Propulsion Type & System Business Wins this quarter
Slide 28: Content Per Vehicle (CPV)
Content Per Vehicle2 (CPV) Q2 2024 Q2 2023 % Change ▪ Global CPV up again North America 283.06 238.43 18.7% ▪ CPV up in every region Europe 101.24 100.10 1.1% Asia Pacific 11.03 10.33 6.8% Global CPV1 85.73 76.27 12.4% Annual Global CPV, except Q2 2024 58.85 61.58 70.80 75.22 85.73 2020 2021 2022 20
Slide 29: Mobility Launches
Mobility Launches 3.50 Launching nearly $3.1 Billion of new work today 3.00 2.50 CAD (Billions) 2.00 1.50 1.00 0.50 0.00 2023 2024 2025 2026 2027 Incremental Growth from Launches $500 to $600 Million in 2024 $700 to $900 Million in 2025 Updated: August 2024 © Linamar Corporation 29
Slide 30: Industrial: Skyjack
INDUSTRIAL: SKYJACK BUILD THE WORLD
Slide 31: Global Manufacturing Expansion Plan
Global Manufacturing Expansion Plan Hungary: Increased production capacity at the OROS site. China: Launched Electric DC Scissor lift models in Tianjin Mexico: A North America capacity expansion with a new site in Saltillo area In Market, For the Market ▪ In addition to the 2 original mfg. sites in
Slide 32: Industrial: Strategy & Operations Highlights
Agenda Industrial: Strategy & Operations Highlights Highlights ▪ Launched new battery electric ‘eBOOM’ Industrial: Strategy & Operations Highlights product range of Zero Emissions articulating booms in both Europe and Australia ▪ Planned roll out of further ZEV Electrified product will continue over
Slide 33: Industrial: Agriculture
INDUSTRIAL: AGRICULTURE FEED THE WORLD .
Slide 34: Linamar Agriculture
Linamar Agriculture Linamar Agriculture Group is a portfolio of successful, independent short line agriculture product brands, building on shared global distribution, markets, and support while linking and leveraging Linamar manufacturing expertise, purchasing power, and global operating systems. Sa
Slide 35: Agriculture Growth Strategic Criteria
Agriculture Growth Strategic Criteria SHORT-LINE OEM DIFFERENTIATED CUSTOMER CONNECTION ▪ Distribution synergies ▪ Innovative & Differentiated Offering ▪ Brand Recognition means end users ▪ OEM Complementary ▪ Strong Intellectual Property who pull demand through channels ▪ Additional Value ▪ Configu
Slide 36: The Ag Strategy Now Addresses the entire Crop Production Cycle
The Ag Strategy Now Addresses the entire Crop Production Cycle Linamar has become a leader in premium short-line agriculture equipment and now with the acquisition of Bourgault provides a full suite of product offerings addressing all segments of the broad acre crop production cycle © Linamar Corpor
Slide 37: Purposefully Building a More Diversified Global Manufacturer
Purposefully Building a More Diversified Global Manufacturer Post-Bourgault Acquisition Pro Forma Annual Operating Earnings Estimate 1 2023 2022 Mobility 2017 46% 54% 2001 Industrial FY2016 Operating Earnings Industrial 21% ▪ Through organic growth and acquisitions, Linamar has built a transformed I
Slide 38: Agricultural: Strategy & Operations Highlights
Agenda Agricultural: Strategy & Operations Highlights Highlights ▪ Linamar Agriculture Strategy is well underway ▪ Bourgault Integration progressing very well. Synergies in product distribution across brands ▪ New MacDon 61’ FD261 product announced for Australian market. Attaching to new Class 10 OE
Slide 39: Financial Review
Financial Review Linamar Corporation 39
Slide 40: Industrial Sales, Earnings, and Margins
Industrial Sales, Earnings, and Margins (in millions CAD) Industrial Sales increased by 14.1% or $109.3 to $886.6 Q2 2024 Q2 2023 ▪ The Sales were helped by: Finance ▪ the additional sales from the acquisition of Bourgault; Sales 886.6 777.3 ▪ volume increases due to market share gains in worldwide
Slide 41: Mobility Sales, Earnings, and Margins
Mobility Sales, Earnings, and Margins (in millions CAD) Mobility Sales increased by 10.5% or $186.6 to $1,962.1 Q2 2024 Q2 2023 ▪ The Sales were helped by: ▪ the additional sales from our Linamar Structures acquisitions in 2023; and Sales 1,962.1 1,775.5 ▪ the increasing volumes on launching program
Slide 42: Operating Expenses
Operating Expenses (in millions CAD) Q2 2024 Q2 2023 +/- % ▪ Gross Margin was $424.8 in the quarter and was impacted primarily by the Sales 2,848.7 2,552.8 295.9 11.6% same factors that impacted each business segment. (See the previous two slides) Cost of Goods Sold 2,423.9 2,190.9 233.0 10.6% ▪ Amo
Slide 43: Finance Expenses & Income Tax
Finance Expenses & Income Tax (in millions CAD) ▪ Finance expenses increased by $21.9 Q2 2024 Q2 2023 +/- ▪ Finance expenses were hurt by: ▪ the new private placement notes issued in June 2023 to fund the Linamar Structures Finance Expense 37.3 15.4 21.9 acquisitions; ▪ the new term credit facility
Slide 44: Leverage
Leverage (in millions CAD) ▪ Cash position at the end of the quarter was $759.9, which was an increase of Q2 2024 Q2 2023 $106.6 from the end of 2023. Cash Position 759.9 1,375.8 ▪ Linamar generated $236.0 in Cash from Operating Activities being used primarily to fund Q2 capital expenditures. Availa
Slide 46: Outlook
Outlook Consolidated Sales Growth Normal Ranges 2023 Actuals 22.9% Expectations 2024 Double Digit Growth Expectations 2025 Continued Growth Q3 2024 Expectations 1 40.3% Double Digit Growth Continued Double Digit Growth Normalized EPS Growth ▪ Mobility Normalized Net Margin 1 7.0% - 9.0% 5.6% Modest

Linamar — Q2 2024 Earnings Presentation on 6ix

Linamar — Q2 2024 Earnings Presentation

Slide 1: Investor Presentation

Slide 2: Forward Looking Information, Risk and Uncertainties

Slide 3: Company Overview

Slide 4: Linamar at a glance

Slide 5: Market Focus Addresses Key Global Trends

Slide 6: Diverse Key Products

Slide 7: Global Operating Structure

Slide 8: Diverse Core Manufacturing Capabilities

Slide 9: Broad Innovation Strategy

Slide 10: Global Footprint

Slide 11: Long Term Sustainability Roadmap & Goals

Slide 12: Linamar's Unique Value Creation Model

Slide 13: Balanced & Diversified Business Model

Slide 14: Linamar Consistently Delivers, Year After Year

Slide 15: Q2 2024 Quarter Highlights

Slide 16: Quarter Highlights

Slide 17: Financial Highlights

Slide 18: Financial Highlights

Slide 19: Mobility Normalized Earnings and Margins

Slide 20: Financial Highlights: Income Statement

Slide 21: Financial Highlights: Cash Flow and Investment

Slide 22: Mobility

Slide 23: Diverse Electrification Strategy Maximizes Potential

Slide 24: Mobility Products Portfolio

Slide 25: Innovation: eLIN eAxle Product Family

Slide 26: Structures and Chassis Portfolio

Slide 27: Mobility: Strategy & Operations Highlights

Slide 28: Content Per Vehicle (CPV)

Slide 29: Mobility Launches

Slide 30: Industrial: Skyjack

Slide 31: Global Manufacturing Expansion Plan

Slide 32: Industrial: Strategy & Operations Highlights

Slide 33: Industrial: Agriculture

Slide 34: Linamar Agriculture

Slide 35: Agriculture Growth Strategic Criteria

Slide 36: The Ag Strategy Now Addresses the entire Crop Production Cycle

Slide 37: Purposefully Building a More Diversified Global Manufacturer

Slide 38: Agricultural: Strategy & Operations Highlights

Slide 39: Financial Review

Slide 40: Industrial Sales, Earnings, and Margins

Slide 41: Mobility Sales, Earnings, and Margins

Slide 42: Operating Expenses

Slide 43: Finance Expenses & Income Tax

Slide 44: Leverage

Slide 45: Outlook

Slide 46: Outlook

Slide 47: Thank You