j.p. morgan auto conference
Post on 19-Mar-2022
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Forward-Looking Statements
Statements in this presentation that are not historical facts are forward-looking statements, which involve risks and uncertainties that could cause actual events or results to differ materially from those expressed or implied by the statements. Important factors that may cause actual results to differ materially from those in the forward-looking statements include, among other factors, the impact of COVID-19, or other future pandemics, on the global economy, and on our customers, suppliers, employees, business and cash flows; the reduced purchases, loss or bankruptcy of a major customer or supplier; the costs and timing of facility closures, business realignment or similar actions; a significant change in automotive, commercial, off-highway, motorcycle and agricultural vehicle production; competitive market conditions and resulting effects on sales and pricing; our ability to successfully launch/produce products for awarded business; adverse changes in laws, government regulations or market conditions, including tariffs, affecting our products or customers products; labor disruptions at Stoneridge’s facilities or at any of Stoneridge’s significant customers or suppliers; the ability of suppliers to supply Stoneridge with parts and components at competitive prices on a timely basis; the amount of Stoneridge’s indebtedness and the restrictive covenants contained in the agreements governing its indebtedness, including its revolving credit facility; customer acceptance of new products; capital availability or costs, including changes in interest rates or market perceptions; the failure to achieve successful integration of any acquired company or business; the occurrence or non-occurrence of circumstances beyond Stoneridge’s control; and the items described in “Risk Factors” and other uncertainties or risks discussed in Stoneridge’s periodic and current reports filed with the Securities and Exchange Commission.Important factors that could cause the performance of the commercial vehicle and automotive industry to differ materially from those in the forward-looking statements include factors such as (1) continued economic instability or poor economic conditions in the United States and global markets, (2) changes in economic conditions, housing prices, foreign currency exchange rates, commodity prices, including shortages of and increases or volatility in the price of oil, (3) changes in laws and regulations, (4) the state of the credit markets, (5) political stability, (6) international conflicts and (7) the occurrence of force majeure events.These factors should not be construed as exhaustive and should be considered with the other cautionary statements in Stoneridge’s filings with the Securities and Exchange Commission.Forward-looking statements are not guarantees of future performance; Stoneridge’s actual results of operations, financial condition and liquidity, and the development of the industry in which Stoneridge operates may differ materially from those described in or suggested by the forward-looking statements contained in this presentation. In addition, even if Stoneridge’s results of operations, financial condition and liquidity, and the development of the industry in which Stoneridge operates are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of results or developments in subsequent periods.This presentation contains time-sensitive information that reflects management’s best analysis only as of the date of this presentation. Any forward-looking statements in this presentation speak only as of the date of this presentation, and Stoneridge undertakes no obligation to update such statements. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.Stoneridge does not undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.Rounding Disclosure: There may be slight immaterial differences between figures represented in our public filings compared to what is shown in this presentation. The differences are the result of rounding due to the representation of values in millions rather than thousands in public filings.
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About Stoneridge
9 Manufacturing locations on 4 continents1965
Founded
NYSE: SRI
10%+5-year backlog**
$3.0 billion5.4x 2020 OEM sales
2025 5-year Revenue CAGR*
*Based on mid-point 2021 revenue guidance and long-term revenue targets provided in fourth quarter 2020 earnings call of $925 million in 2023 and $1.1 billion in 2025**The Company defines backlog as the estimated cumulative awarded sales for the next five years (or “estimated sourced future sales”). Backlog as of December 31, 2020
excludes previously awarded sales related to the particulate matter soot sensor products business due to the planned exit of this business in 2021
Stoneridge is an established, global company with a well diversified product portfolio, strong historical financial performance and a robust 5-year backlog
Drivetrain agnostic portion of targeted 2025
sales
~85%
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Stoneridge Evolution and Overview
Organizational Transformation
▸Moved headquarters to Novi, Mich., and assembled new leadership team
▸Assembled new executive leadership team with significant industry expertise
▸Rationalized manufacturing footprint to optimize cost structure and better serve our customers
▸Created CTO position and advanced development team leading robust technology roadmap
▸Development of technologies that elevate our products from components to system-based solutions
▸Divestiture of non-core businesses including wiring business in 2014, switches and connectors product lines in 2019 and soot sensor product lines in 2021
▸Acquisition of Orlaco (2017) and 100% of PST (2017)
▸ Investment in Autotech Ventures VC fund for access to cutting-edge technology and start-up partnerships
Portfolio Transformation
Revenue Breakdown (2020A)
By Segment By End Market By Geography By Customer
Control Devices
53%
Electronics40%
Stoneridge Brazil
7%
North America
51%Europe33%
South America
7%
Asia Pacific
9%
Ford11%
Volvo Truck8%
American Axle6%
Daimler 5%
Stellantis 5%
MAN 5%Scania 5%GM
4%
All Others
51%
Traditional Passenger Car
8%
Light Truck / SUV / CUV
41%Commercial Vehicle OE
30%
Aftermarket / Non-OE / Other
21%
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Stoneridge, Inc (NYSE: SRI)2020 Sales : $648 million
Current Portfolio Overview
Current portfolio aligned with megatrends in the transportation industry
▸Powertrain Actuation• Transmission• Axle-Based
▸Sensing• Emissions• Position
CONTROL DEVICES53% of 2020 Sales
▸Track and Trace▸Audio and Alarm
• Aftermarket Audio• Security Alarms
▸ In-region OEM Business• Commercial Vehicle
Connectivity• Commercial Vehicle Driver
Information Systems
STONERIDGE BRAZlL7% of 2020 Sales
▸Driver Information Systems• Instrument Clusters
▸Connectivity and Controls• Telematics• Tachographs• Switches and Controls
▸Vision and Safety Systems• MirrorEye®• Off-highway
ELECTRONICS40% of 2020 Sales
MEGATRENDS
EMISSIONS
Our focus on these megatrends are expected to drive growth of 2-3x our underlying markets over the cycle
FUEL EFFICIENCYSAFETY & SECURITY INTELLIGENCE
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Leveraging Our Existing Technology Portfolio
Our telematics and tachograph units
provide a gateway for vehicles to connect to
other vehicles, fleet management tools and
the environment around them
Connectivity Our vision products create safer vehicles and enable advanced
active safety applications when
combined with other sensors and powertrain
applications
Vision and Safety
Our driver information systems are the
primary interface between a driver and the vehicle and will enable additional
driver features and vehicle / driver
interaction
Driver Information Systems
Stoneridge is committed to being a truck technology partner. We are developing technology platforms that combine vision systems, connectivity capabilities and driver information systems.
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• Proprietary mirror enhancement and replacement technology for commercial vehicles with integrated external digital cameras and digital monitors inside the cab of the truck
• Interior high-definition displays are mounted on the left and right A-Pillars to give the driver a familiar, natural driving experience
• Enables a greater field of view and eliminates common blind spots, thereby significantly improving driver safety
• High-definition cameras provide enhanced vision quality including full-color night vision, low light sensitivity, glare reduction and superior views in inclement weather conditions
• Advanced trailer panning capabilities minimize right-hand turn collisions
• Aerodynamic design improves fuel economy
MirrorEye is revolutionizing the commercial vehicle industry by replacing a commercial vehicle’s conventional mirrors with integrated camera technology
Highlights
"BETTER SAFETY THROUGH BETTERVISION"
Automotive News PACE Award
(2020)
Jim Winsor Memorial Technical Achievement Award
(2020)
Innovation Label
Busworld Award (2019)
MirrorEye Technology Highlights
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MirrorEye is Stoneridge's revolutionary innovation that will drive critical safety and fuel efficiency benefits in the commercial vehicle market
Technology Features MirrorEye By the Numbers
product in the US with FMCSA approval to operate commercial vehicles without mirrors
FIRSTawarded programs from global commercial vehicle OEMs
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awarded commercial vehicle OEM market share in North America
~75%of the awards in Europe, representing ~33% of European production volume
~50%
in peak annual contracted OEM revenue from existing awards at a conservative ~15% quoted take rate
~$70mmannual OEM revenue opportunity from existing awards assuming a 100% take rate
+$500mm
IMPROVED VISIBILITYIN INCLEMENT
WEATHER
GREATER FIELD OFVIEW
AUGMENTED VISIONQUALITY
REDUCTION / ELIMINATION OF
BLIND SPOTS
FULL-COLORINFRARED NIGHT
VISION
24/7 ROADSIDESUPPORT
IMPROVEDAERODYNAMICS
& FUEL ECONOMY
ADVANCEDTRAILER PANNING
MirrorEye: Proprietary Technology Overview
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Delivering Shareholder Value
Stoneridge is a well-established, global, transportation technology company
Our executive team is comprised of industry leaders capable of driving global growth
We are well diversified globally, by segment, by end-market and by customer
Our long-term strategy positions us to outpace vehicle market growth by 2 – 3x over the next 5 years and achieve top quartile financial performance*
Stoneridge is focused on driving shareholder return through financial performance and a well-defined long-term strategy
*Relative to automotive suppliers under $2 billion of revenue
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