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Page 1: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

NN, Inc. NN, Inc. PresentationPresentation

Page 2: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

NN, Inc. TodayNN, Inc. TodayBearing

ComponentsBearing

ComponentsPrecision Metal

ComponentsPrecision Metal

Components

Page 3: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

NN, Inc. TodayNN, Inc. Today

A leading independent supplier of high precision components and assembliesA leading independent supplier of high precision components and assemblies

14 manufacturing facilities in North America, Europe and Asia14 manufacturing facilities in North America, Europe and Asia

Global manufacturing presenceGlobal manufacturing presence

Serving diverse industrial end marketsServing diverse industrial end markets

Page 4: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

NN makes the Forbes “200 Best” List for the 4th TimeNN makes the Forbes “200 Best” List for the 4th Time

Page 5: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Key Events - HistoryKey Events - History

81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 0781 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07

Revenue ($ millions)Revenue ($ millions)

$0$0

$50$50

$100$100

$150$150

$200$200

$250$250

$300$300

$400$400

1998 - Launched Bearing Components Strategic Plan ($73 mm) 1998 - Launched Bearing Components Strategic Plan ($73 mm)

1999 - Acquired IMC ($85 mm)1999 - Acquired IMC ($85 mm)

2001 - Acquired Delta Rubber ($180 mm)2001 - Acquired Delta Rubber ($180 mm)

1994 - Initial Public Offering ($61 mm)1994 - Initial Public Offering ($61 mm)

1980 - Company Founded1980 - Company Founded

2003 - Acquired Veenendaal (Netherlands)2003 - Acquired Veenendaal (Netherlands)

2003 - Acquired 100% of Euroball Joint Venture (Italy, Germany, Ireland)2003 - Acquired 100% of Euroball Joint Venture (Italy, Germany, Ireland)

2003 - Acquired Slovakia Factory ($268 mm)2003 - Acquired Slovakia Factory ($268 mm)2004 - China Factory Start-Up2004 - China Factory Start-Up

2005 - Acquired SNR ($321 mm)2005 - Acquired SNR ($321 mm)2006 - Launched Precision Metal Components Strategic Plan2006 - Launched Precision Metal Components Strategic Plan2006 - Acquired Whirlaway ($405 mm*)2006 - Acquired Whirlaway ($405 mm*)

* Proforma* Proforma

Page 6: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

NN Inc. \ WhirlawayNN Inc. \ Whirlaway

+Whirlaway

NN Inc.

• Diversified public company with history of financial stability

• Company with global footprint to accelerate support of customer globalization

• Commitment to quality and customer service

• Broad depth of technical and manufacturing resources

• Integrated marketing and technical services approach

• Customer solutions focus

• Diversified public company with history of financial stability

• Company with global footprint to accelerate support of customer globalization

• Commitment to quality and customer service

• Broad depth of technical and manufacturing resources

• Integrated marketing and technical services approach

• Customer solutions focus

Page 7: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

NN Inc. \ WhirlawayNN Inc. \ Whirlaway

• Proven provider of collaborative technical solutions - Value added engineering

• Comprehensive manufacturing process technology experience

• Competent mechanical engineering team for design, build, and integration of equipment and software

• Program management system

• Proven provider of collaborative technical solutions - Value added engineering

• Comprehensive manufacturing process technology experience

• Competent mechanical engineering team for design, build, and integration of equipment and software

• Program management system

• Diversified global market presence

• Experience in metal components manufacturing

• Focused on Lean manufacturing, six sigma, TPM

• Expertise in applications marketing

• Publicly traded company with solid financial history

• Diversified global market presence

• Experience in metal components manufacturing

• Focused on Lean manufacturing, six sigma, TPM

• Expertise in applications marketing

• Publicly traded company with solid financial history

Whirlaway NN Inc.

Page 8: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Competitive AdvantagesCompetitive Advantages

NN StrengthsNN Strengths Result InResult In

Customer needs driven culture

High precision component and assembly manufacturing

Collaborative component and tooling design

Component and tooling design

“Level 3” - Six Sigma, Lean Manufacturing, Total Productive Maintenance

Customer needs driven culture

High precision component and assembly manufacturing

Collaborative component and tooling design

Component and tooling design

“Level 3” - Six Sigma, Lean Manufacturing, Total Productive Maintenance

Unparalleled service

High quality

Value-enhancing, engineering capability

Cost competitive global structure

Unparalleled service

High quality

Value-enhancing, engineering capability

Cost competitive global structure

Page 9: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Global Market PresenceGlobal Market Presence

Erwin, TNMt. City, TNErwin, TNMt. City, TN

Danielson, CTDanielson, CT

Lubbock, TXLubbock, TX

Eltmann, GermanyEltmann, Germany

Pinerolo, ItalyPinerolo, Italy

Kilkenny,IrelandKilkenny,Ireland

Veenendaal, The NetherlandsVeenendaal, The Netherlands

SlovakiaSlovakia

Plant Locations: NN Ball and Roller Whirlaway NN Europe - Euroball NN Europe - Veenendaal IMC Delta Rubber China Customer/Country Locations

Plant Locations: NN Ball and Roller Whirlaway NN Europe - Euroball NN Europe - Veenendaal IMC Delta Rubber China Customer/Country Locations

Kunshan, Jiangsu, ChinaKunshan, Jiangsu, China

Tempe, AZTempe, AZ

Wellington, OHWellington, OHHamilton, OHHamilton, OH

Page 10: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Facilities and EmploymentFacilities and Employment

Erwin, TN Employees: 215

Mt. City, TN Employees: 92

Industrial MoldingLubbock, TX

Employees: 286

Delta RubberDanielson, CT

Employees: 196

NN ItalyPinerolo, Italy

Employees: 336

NN NetherlandsVeenendaal, NLEmployees: 377

NN IrelandKilkenny, IrelandEmployees: 76

NN GermanyEltmann, Germany

Employees: 129

NN SlovakiaKysucke,

NM SlovakiaEmployees: 49

Kunshan, ChinaEmployees: 47

14 Manufacturing Facilities

- North America - Europe - Asia

2,450 Global Employees

US Ball and Roller Division Whirlaway Division

Wellington, OH 1Employees: 230

Wellington, OH 2Employees: 200

Hamilton, OHEmployees: 30

Triumph LLCTempe, AZ

Employees: 200

NN Asia

Plastic and Rubber Division

NN Europe

Page 11: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

ManagementManagementRock Baty

CEO, President and Chairman

Jim DortonVP Corporate Development and CFO

Tom ZupanPresident - Whirlaway Division

Dave GilsonVP Sales and Marketing

Nicola TrombettiVP, MD-NN Europe

Will Kelly VP Admin, Treasurer and CCO

Frank GentryVP, GM-U.S. Ball and Roller

Jeff HodgeCorporate Director-Level 3

Tom McKownVP, MD-NN Asia

James AndersonGroup VP – Plastics and Rubber

Page 12: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Business Unit RevenueBusiness Unit Revenue

NN EuroballBalls $128 MMNN Euroball

Balls $128 MM

NN AmericasBalls $53 MM

Cylindrical Rollers $13 MM

NN AmericasBalls $53 MM

Cylindrical Rollers $13 MM

IMCPlastic Components

$22 MM

IMCPlastic Components

$22 MM

Delta RubberBearing Seals

$26 MM

Delta RubberBearing Seals

$26 MM

VeenendaalTapered Rollers

Metal Cages $69 MM

VeenendaalTapered Rollers

Metal Cages $69 MM

$405 MM$405 MM

IMCPlastic Bearing

Retainers $10 MM

IMCPlastic Bearing

Retainers $10 MM

WhirlawayMetal Components

$80 MM

WhirlawayMetal Components

$80 MM

Page 13: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Served MarketsServed Markets

Bearing Bearing ComponentsComponents

Precision Metal Precision Metal ComponentsComponents

AutomotiveAutomotive General IndustrialGeneral Industrial

AutomotiveAutomotiveGeneral IndustrialGeneral IndustrialDiesel EnginesDiesel EnginesCommercial Refrig.Commercial Refrig.Thermal SystemsThermal SystemsOil and GasOil and GasAerospaceAerospaceMedicalMedical

Current MarketCurrent Market Future MarketFuture Market

Page 14: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Served MarketsServed MarketsServes wide variety of industrial end marketsServes wide variety of industrial end markets

Industrial Thermal Systems Commercial Refrig. Diesel Engine Material Handling Construction General Industrial

Industrial Thermal Systems Commercial Refrig. Diesel Engine Material Handling Construction General Industrial

Automotive Engine Brake/Chassis Steering Power Train

Automotive Engine Brake/Chassis Steering Power Train 45%45%

55%55%

Future Markets Oil & Gas Aerospace Medical

Future Markets Oil & Gas Aerospace Medical

Page 15: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Product PlatformsProduct Platforms

Bearing Bearing ComponentsComponents

Precision Metal Precision Metal ComponentsComponents

Precision BallsPrecision Balls RollersRollers RetainersRetainers SealsSeals

Fluid Control Fluid Control Components Components AssembliesAssemblies

ShaftsShaftsPrisms, RingsPrisms, RingsHousings, BracketsHousings, Brackets

Page 16: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Product Mix OverviewProduct Mix Overview

Precision Balls45%

Retainers7%

Bearing Selas6%Plastic Components

6%

Precision Metal Components

20%

Tapered/Cylindrical Rollers16%

Page 17: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Customer OverviewCustomer Overview

Other19%

TRW2%

Iljin2%

Siemens2%

Eaton2%

Copeland6%

Timken6%

GKN2%

Delphi4%

SNR3%

Bosch1%

Caterpillar1%

INA/FAG12%

SKF38%

Page 18: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Financial HighlightsFinancial Highlights

Page 19: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Historical SalesHistorical Sales

($25)

$25

$75

$125

$175

$225

$275

$325

$375

$425

1999

2000

2001

2002

2003

2004

2005

2006

Est

2006

Pro

form

a

$85

$132

$180 $192

($Millions)

$253

$304$321

22% CAGR

(2006 Proforma)

$325

$405

Page 20: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Annual EBITDAAnnual EBITDA

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

1999 2000 2001 2002 2003 2004 2005 2006 Est

$ millions

$18

$26

$31

$37 $36

$44

$27

14% CAGR

$45

Page 21: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

EPS from OperationsEPS from Operations

$0.57

$0.76

$0.54

$0.31

$0.66

$0.52

$0.00

$0.10

$0.20

$0.30

$0.40

$0.50

$0.60

$0.70

$0.80

$0.90

$1.00

1999 2000 2001 2002 2003 2004 2005 2006 Est

$’s/Share

$0.86-$0.92

8% CAGR

$0.87

Page 22: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Historic EBITDA To Debt LevelsHistoric EBITDA To Debt Levels

*Year end ratio. EBITDA adjusted to include full year EBITDA for acquisitions made during indicated year and to exclude effects of one-time unusual charges.*Year end ratio. EBITDA adjusted to include full year EBITDA for acquisitions made during indicated year and to exclude effects of one-time unusual charges.

Debt/EBITDA*Debt/EBITDA*

1.0

1.2

1.4

1.6

1.8

2.0

2.2

2.4

2000 2001 2002 2003 2004 2005 2006

1.5X 2.0X 1.4X 2.2X 2.1X 1.4X 1.9X

Page 23: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

2006 - 2010 Strategic Plan2006 - 2010 Strategic Plan

Page 24: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

2006 - 2010 Strategic Plan 2006 - 2010 Strategic Plan

1. Enhance R&D and create applications

marketing expertise

2. Continue growth and expansion of operations

in Asia region

3. Accelerate Level 3 Initiatives (Lean, Six

Sigma, TPM)

1. Enhance R&D and create applications

marketing expertise

2. Continue growth and expansion of operations

in Asia region

3. Accelerate Level 3 Initiatives (Lean, Six

Sigma, TPM)

Operational Execution Initiatives:Operational Execution Initiatives:

Page 25: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

2006 - 2010 Strategic Plan2006 - 2010 Strategic Plan

1. Grow existing bearing components:• Roller product expansion

• Geographic expansion of existing products

2. Creation of new metal related component

product platform via acquisition

1. Grow existing bearing components:• Roller product expansion

• Geographic expansion of existing products

2. Creation of new metal related component

product platform via acquisition

Growth Initiatives:Double Revenue and Income in 5 Years

Growth Initiatives:Double Revenue and Income in 5 Years

Page 26: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Bearing Components

93%

Other Industrial Products

7%

Bearing Components

93%

Other Industrial Products

7%

Bearing Components

55%

Other Industrial Products

5%

New Precision Steel Components

40%

Bearing Components

55%

Other Industrial Products

5%

New Precision Steel Components

40%

Sales Development 2006 – 2010 By Product GroupSales Development 2006 – 2010 By Product Group

2006 Business Plan 2010 Pro-Forma

$325 million $720 million

Page 27: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Automotive50%

Other5%

Industrial45%

Automotive50%

Other5%

Industrial45%

Automotive65%

Other5%

Industrial30%

Automotive65%

Other5%

Industrial30%

Sales Development 2006-2010 By End MarketSales Development 2006-2010 By End Market

2006 Business Plan 2010 Pro-Forma

$325 million $720 million

Page 28: NN, Inc. Presentation. NN, Inc. Today Bearing Components Precision Metal Components

Conclusions Conclusions

• NN has developed a strong core business in high precision

bearing components

• New strategy provides for growth via following strategic initiatives:

• Continued growth of core bearing components core business

• Creation of new high precision metal components product platform

• Growth goals are achievable and closely related to our

core

• NN has developed a strong core business in high precision

bearing components

• New strategy provides for growth via following strategic initiatives:

• Continued growth of core bearing components core business

• Creation of new high precision metal components product platform

• Growth goals are achievable and closely related to our

core