Dorman Products, Inc. · NASDAQ:DORM
Dorman Products — Investor Presentation (June 2016)
18 slides from Dorman Products's investor presentation, June 2016
Slide 1: Dorman Products Investor Presentation June 2016
5 — = “DORMAN. a NEWSINCE 1918 NEW PRODUCTS * NEW SOLUTIONS * NEW OPPORTUNITIES
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements in this presentation constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believe,” “demonstrate,” “expect,” “estimate,” “forecast,” “anticipate,” “should” and “likely” and sim
Slide 3: Agenda
Agenda Dorman Snapshot Industry Dynamics Growth Strategy Financial Results Summary 3
Slide 4: Dorman History
Dorman History ► Founded in 1978 • NASDAQ Listed Since 1991: DORM • Founding Family = 24% Ownership ► Leading Aftermarket Supplier of Dealer Exclusive Parts ► Net Sales of $823 Million on Trailing 12 month basis • 9% net sales growth over Trailing 12 months • 5 year CAGR of 13% — All Organic Dorman
Slide 5: Dorman's Core Automotive Competencies
Dorman’s Core Automotive Competencies Unique Business Model: Broad Distribution “New-to-the-Aftermarket” U.S. Other Traditional 6% 46% U.S. Retail 48% Global Design, Development Broad Product Portfolio and Sourcing Capabilities Focuses on ‘Niche’ Offerings Hardware Auto Body 7% 30% Chassis 25% Power
Slide 6: Industry Dynamics
Industry Dynamics Sources: 2016 Auto Care Association Factbook, US Dept of Trans, and US Energy Information Admin. 6
Slide 7: New Products Driving Growth
New Products Driving Growth ► Growth Rates Outpace the Broader Aftermarket ► New Product Revenues Creates Growth • Items Previously Only Available at the OE Dealer or Salvage Yard • New Products = Comp Store Sales Growth for Customers NEW 7
Slide 8: New-to-the-Aftermarket Products
New-to-the-Aftermarket Products New Product Sales Opportunities for Our Customers: 2013 2014 2015 Q1 2016 LTM Q1 16 New to the Aftermarket 873 1,266 1,495 372 1,580 Line Extensions (many of which are exclusive items) 2,587 2,476 3,357 731 3,674 Total unique parts introduced 3,460 3,742 4,852 1,103 5
Slide 9: New-to-the-Aftermarket Engine
New-to-the-Aftermarket Engine ► Unique Installer Relationships and Feedback Network to Identify Failure-prone OEM Parts • Products introduced in last two years generated 19% of sales in 2015 ► Culture of Contribution Drives Innovation • 350+ product personnel in 10+ co-located teams in US and Asia •
Slide 10: 2016 Marketing Focus
2016 Marketing Focus The destination for formerly ‘Dealer Only’ Engineered solutions designed to correct Emphasized with: known OE Failures • Web • Print • Video • Email • Advertising • Social Media Videos New Service Product Dealer Alerts Guides Market-leading product education Core category awaren
Slide 11: Growth: Market Expansion and Opportunistic Acquisitions
Growth Market Expansion ► US and Canadian Light Duty Automotive Markets ► Medium & Heavy Duty Aftermarket • Currently ~1% of Sales Opportunistic Acquisitions ► Expertise in Automotive ► Heavy Duty Distribution ► New North American Market 11
Slide 12: Financial Results Summary
Financial Results Summary ► Consistent track record of organic revenue and EPS growth • 5 year sales CAGR of 13% through 2015 • 5 year EPS CAGR of 14% through 2015 ► Stable gross and operating margin trends ► SG&A leverage despite higher product development investments ► Operating margin expansion ►
Slide 13: Strong Organic Sales and Earnings Growth
Strong Organic Sales and Earnings Growth Sales (in millions) – 5 year CAGR 13% EPS – 5 year CAGR 14% [1] YTD Sales YTD EPS growth - 2 growth - 2 year CAGR of year CAGR of 6.5% 5.3% [2] [ 1 ] - 2014 includes $4.6 million in incremental ERP transition costs ($0.08 per share) - 2015 includes $3.5 milli
Slide 14: Summary Income Statement
Summary Income Statement Three Months 2015 2016 Net Sales $ 188,474 $ 208,148 Gross Profit 72,893 80,594 Margin 38.7% 38.7% SG&A 39,241 41,663 Op. Income 33,652 38,931 Margin 17.9% 18.7% Int. and Other 52 57 Income Taxes 12,261 14,203 Net Income $ 21,339 $ 24,671 Diluted EPS $ 0.60 $ 0.71 14
Slide 15: Summary Balance Sheet
Summary Balance Sheet December March 2015 2016 Cash $ 78,659 $ 86,978 AR 203,923 207,395 Inventory 193,725 187,586 Other current assets 2,326 2,732 P,P & E, net 87,046 88,429 Goodwill and other assets 56,186 58,089 Total Assets $ 621,865 $ 631,209 Debt $ - $ - Current liabilities 98,570 92,487 Long
Slide 16: Summary Cash Flows
Summary Cash Flows Three Months 2015 2016 Net Income $ 21,339 $ 24,671 Dep'n and Amort'n 3,618 4,499 Change in AR 4,883 (4,468) Change in Inventory (9,515) 6,139 Change in AP 939 (11,930) Other W/C Items 2,540 5,003 Operating C/F 23,804 23,914 Capital Spending (5,749) (5,598) Share repurchases (1,23
Slide 17: Recap
Recap ► Dominant New-to-the-Aftermarket Parts Supplier ► Strong Growth Opportunities ► Long Track Record of Revenue and Cash Flow Growth ► Solid Balance sheet 17
Slide 18: Questions?
Questions? Matt Barton Kevin Olsen President and Chief Executive Officer SVP – Chief Financial Officer [email protected] [email protected] 215-712-5132 215-712-5182 18