Larry Denton Chairman & CEO. Keith Marchiando Vice President & CFO

Transcription

1 Larry Denton Chairman & CEO Keith Marchiando Vice President & CFO

2 Cautionary Statement This presentation contains forward-looking statements that are subject to risks and uncertainties. These statements often include words such as believe, expect, anticipate, intend, plan, estimate, or similar expressions. These statements are based on certain assumptions that the company has made in light of its experience in the industry as well as its perspective of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. Actual results may differ materially from the anticipated results because of certain risks and uncertainties, including but not limited to (i) the company s reliance on major customers; (ii) fluctuations in the production volumes of vehicles for which the company is a supplier, (iii) the ability of the company to achieve its planned cost savings; (iv) labor disputes involving the company or its significant customers, (v) risks associated with conducting business in foreign countries, and (vi) general economic or business conditions affecting the automotive industry, either nationally or regionally, being less favorable than expected.

3 Agenda A Solid Foundation Financial Review Repositioning For Success

4 A Solid Foundation

5 Company Overview Larry Denton Chairman and Chief Executive Officer Based on 2005 Sales. US$1.30 Billion Milton Kniss Division President US$660 Million Jürgen von Heyden Division President US$390 Million Tim Stephens Division President Control Systems A Division of DURA Automotive Systems, Inc. Body & Glass Systems A Division of DURA Automotive Systems, Inc. Mobile Products A Division of DURA Automotive Systems, Inc.

6 A Solid Foundation Strong Performance in Key Metrics - Quality - Sales per Employee - Customer Diversification - Regional Sales Diversification - New product Introductions Agility & Best-in-Cost Positioning Product Innovation

7 Continued Gains in Quality & Efficiency P E R F O R M A N C E Quality Index Sales per Employee * Target quality levels

8 A Diversified Customer Base P E R F O R M A N C E Sales by end OEM Customer 13% 9% 5% 3% 1% 2% 1% 4% Other OEMs 21% 17% RV and Specialty Vehicles 24% * Based on 2005 revenue

9 A Diversified Customer Base P E R F O R M A N C E Sales by Customer Group Asia OEMs Global 3% 36% Big 3 (NA) RV/Specialty Vehicle 17% EU OEM s 25% 19% Big 3 - ROW * Based on 2005 revenue

10 Geographic Diversification P E R F O R M A N C E Sales by Region 17% Atwood 4% Rest of World 40% NA Auto 38% EUR Auto * Based on 2005 revenue

11 A Diversified Product Portfolio P E R F O R M A N C E Citroen Picasso Shift-by-Wire Actuator Mercedes Sprinter Sliding Glass, Cables Saturn Sky Pedal Asm Dodge Charger Park Brake Systems Dacia X90 (Romania) SsangYong (Korea) Audi A6 (China) Acura MDX Nissan Altima Honda CRV (EU) Park Brake Cables Dodge Nitro ATX Floor Shifter Ford Edge Cross Members Tire Carrier Lincoln Aviator Over 140 New Launches in 2006 Ford Expedition Jack Asm Toyota Corolla Doors in White Buick Rendezvous Seat Adjusters Modular Shifters, Seat Adjusters, Cables Modular Shifters Glass Systems, Park Brake, Cables Hinges 2nd & 3rd Row Seat Adjusters, Park Brake BMW Mini Cable Systems Pontiac SV6 Seat Recliners BMW X5 Exterior Trim, Cables Skoda Roomster Space Frame Components Jeep Wrangler/ Scrambler Liftgate Glass, Pedals, Shifters Saturn Outlook 2nd & 3rd Row Seat Adjusters, Cables, Shifters, Seat Recliners

12 Solid Foundation B E S T I N C O S T Strong Performance in Key Metrics - Quality - Sales per Employee - Customer Diversification - Regional Sales Diversification - New Product Introductions Agility & Best-in-Cost Positioning Product Innovation

13 Agility & Best-in-Cost Positioning B E S T I N C O S T Low number of employees per plant Small town locations Low legacy costs N.A. health care employee contributions Lean/small management team Global centers-of-excellence for engineering

14 Low Cost Presence B E S T I N C O S T LCC Locations 14

15 DURA Latin America B E S T I N C O S T Mexico Four facilities located in Matamoros and Queretaro Established manufacturing locations, recognized by our customers Multi-product facilities Low-cost manufacturing 168,000 sq. ft. Matamoros expansion facility opened June 2006 Queretaro, Mexico Body & glass systems, sliding window systems, encapsulated windows, RackLift TM window lift systems Matamoros Campus Driver control systems, parking brake cables, jacks, ATX cables, sliding window systems

16 DURA - Eastern Europe B E S T I N C O S T Romania New facility in Timisoara, Romania July 05 Multi-product facility: - driver control systems - cable systems - shifter systems Planning for two expansion phases in progress Czech Republic & Slovakia 4 New facilities since 2001 Expansion of Koprivnice facility in progress (100,000 sq. ft.)

17 DURA - Asia China DURA Vehicle Components Company DURA Ganxiang Automotive Systems LOI to form a third joint venture Representative Office - Purchasing - Sales B E S T I N C O S T Japan, Korea & India Sales offices / alliances

18 Solid Foundation I N N O V A T I O N Strong Performance in Key Metrics - Quality - Sales per Employee - Customer Diversification - Regional Sales Diversification Agility & Best-in-Cost Positioning - Low Legacy Costs - Best-In-Cost Locations Product Innovation

19 Joint Ventures - Duratronics I N N O V A T I O N 50 / 50 JV with Olhotronic GmbH Electronic Control Modules & Software Manufacturing and Design

20 New Product Innovations I N N O V A T I O N New Hybrid Shift-By-Wire Designed for ATX Transmissions First Actuator Contract with PSA 06 Launch Debut at 06 Paris Motor Show New RackLift Window Lift Lightweight Plastic 06 PT Cruiser Launch Exclusive license for DURA 2 nd and 3 rd Row Seating Growing Trend for Fully Adjustable Rear Seating in Crossover and SUV s DURA Seat Mechanisms Launch on Cadillac SRX, Saturn Outlook, Buick Rendezvous

21 New Product Innovations I N N O V A T I O N New Modular Shift Systems 9 Models of Cars & Trucks with Ford 05 Launch Zephyr, Fusion, Milan 06 Launch Edge, Aviator Power Adjustable Pedals 07 launch on 4 new models Improves Driver Comfort and Safety Electronic Throttle Control Option

22 Power Sliding Lightweight Door Module I N N O V A T I O N Highlights Leverages DURA s door structure and mechatronics capabilities Eliminates need for external guide rails Significantly improves egress DURA Peugeot 1007

23 Financial Review Q2 06

24 A SOLID FOUNDATION Q2 06 vs. Q2 05 FINANCIALS REPOSITIONING FINANCIALS FOR SUCCESS US$ Millions Revenue Adjusted EBITDA* $1,000 $100 $800 $600 $400 $573 $624 $75 $50 $50 $200 $25 $21 $0 Q Q $0 Q Q *Adjusted to exclude facility consolidation, and favorable settlement of an environmental matter in 2005.

25 Q2 06 vs. Q2 05 Causal Analysis Dura Revenue - Quarter $7 R E V E N U E US$ Millions $8 ($28) ($38) ($51) Total Volume / Dura Mix / Pricing Volume (RV) Net New Business ForEx

26 A SOLID FOUNDATION FINANCIALS REPOSITIONING FINANCIALS FOR SUCCESS Q2 06 vs. Q2 05 Causal Analysis Dura Adjusted EBITDA - Quarter E B I T D A US$ Millions ($4) ($2) ($9) ($14) ($29) Total Volume Net New Business Forex Net Performance

27 A SOLID FOUNDATION FINANCIALS Capitalization Table US$ Millions REPOSITIONING FOR SUCCESS C A P I T A L I Z A T I O N 7/2/2006 Cap 12/31/2005 Cap Senior secured notes (ABL revolver) $ % $ % 2nd lien notes % % 8 5/8% Senior unsecured notes* % % 9% Senior subordinated notes USD % % EUR % % Other debt 6.8 0% 7.5 1% Convertible trust preferred % % 1, % 1, % Cash % % Total net debt 1, % 1, % Shareholders' equity % % Total capitalization (incl. Cash) $ 1, % $ 1, % *Excludes gains/losses on interest rate sw aps.

28 Cash & Availability at 7/2/06 Cash on-hand of $123 million Availability under the revolving credit facility of $96M L I Q U I D I T Y $200 Quarterly Cash Balances (USD millions) $150 $100 $50 $0 Q2 FY 05 Q3 FY 05 Q4 FY 05 Q1 FY 06 Q2 FY 06

29 Debt Amortization as of 7/2/06 D E B T 9% Notes May 2009 (USD Millions) 8.625% Notes April 2012 $533 2 nd Lien Notes May 2011 Revolver * May 2010 $225 $ % Trust Preferred March 2028 $50 $ * Amount outstanding under our revolving credit facility at

30 A SOLID FOUNDATION FINANCIALS REPOSITIONING FOR SUCCESS Restructuring Initiatives R E S T R U C T U R I N G Cash cost of $100 million Approximately $30 million for capital expenditures and $70 million for severance, moving and closure expenses Savings Primarily driven from wage rate enhancements, operational efficiencies and purchasing savings Payback period of three years

31 Repositioning For Success

32 Repositioning For Success Near-Term Cost Reduction Activities 50 3 Operational Restructuring Strategic Portfolio Evaluation

33 Revenue Decline (10%) A SOLID FOUNDATION FINANCIALS REPOSITIONING FOR SUCCESS Near-term Cost Reduction Activities Indirect labor workforce reduction Designed to align overhead with current industry conditions and lower revenue 510 indirect employees worldwide Complete in third and fourth quarters of 2006 Current Indirect Labor Indirect Labor Less 510 (10%)

34 Near-term Cost Reduction Activities Raw material cost recovery Price sharing/recovery initiatives in steel, aluminum & resins $32 Hot Rolled Steel Volatility $28 $32 OEM steel resale programs Will mitigate DURA s exposure to raw material pricing fluctuations DURA is active with one OEM for 2006 A second OEM is planned for first quarter of 2007 Negotiations are in process with a third OEM $23 $/cwt. Jan 05 Jul 05 Jan 06 Jul 06 Aluminum Commodity Pricing $2380 $1490 $/ton Jan 04 Jul 06

35 Repositioning For Success Near-Term Cost Reduction Activities 50 3 Operational Restructuring Strategic Portfolio Evaluation

36 Three Accelerated Goals By End of I N I T I A T I V E Performance Optimization Worldwide Efficiency Results 50 PPM Global Quality 50% of Revenue In Best-In-Cost Facilities 50% Increase In Earnings (EBITDA)

37 50 3 Restructuring Overview I N I T I A T I V E Objective is to increase efficiencies in manufacturing 2,000 jobs relocated / moved to low cost countries with established operating experience 50% of our manufacturing facilities will be impacted 5 to 10 facilities to be closed Will be completed by year-end 2007

38 50 3 Organizational Realignment I N I T I A T I V E Milt Kniss, President Control Systems Division Product transfers and facility consolidation Accelerating improved financial results through operational efficiencies 30+ years of operations experience in the automotive industry, including extensive restructurings Jurgen von Heyden, President Body & Glass Systems Division Lead representative for Western European Workers Council discussions John Knappenberger, VP Purchasing, Quality & IT Accelerating purchasing performance & cost reduction activities Two regional dedicated teams to implement restructuring activities Robert McMackins, Director of Mexico Operations Martin Becker, Director of Central Europe Operations

39 Restructuring Current Status I N I T I A T I V E Three facility closures have been announced to date: Brantford, Ontario Llianelli, Wales LaGrange, Indiana North America Product transfers have been initiated for selected sliding glass programs to be moved to Matamoros, MX Europe Product transfers have been initiated for selected programs to be moved to Koprivnice, CZ and Timisoara, RO 400 jobs have been announced to be relocated to Best-in-Cost locations

40 50 3 Restructuring Status Metrics I N I T I A T I V E Relocation of 2000 Jobs 400* % of Revenue in Best-in-Cost facilities % Current * 36% Objective 50% * Announced to date

41 New Enterprise Resource Planning System I N I T I A T I V E Creates a common platform for four corporate leveraged functions: Human Resources Finance Information Technology Purchasing Improves inventory management Improves supply chain management Reduces compliance costs for Sarbanes-Oxley requirements 21 locations in North America will be live by April 2007 Locations Launched Through July of 21 locations

42 Enhanced Purchasing Initiatives I N I T I A T I V E Global pricing model 25% reduction in current supply base and increase volumes with preferred suppliers Targeted savings of 3-5% of purchased material cost in 2006 Increase Asia Pacific sourcing Target commodities with high labor content and lower raw material price Dedicated resources added to manage and coordinate all regional sourcing activities

43 Localized Purchasing Opportunity NUMBER OF SUPPLIERS: 125 NUMBER OF LOCAL SUPPLIERS: 6 USA 8 OTHER 9 UK 18 FR 20 DE 36 CZ 6 KOPŘIVNICE PT 4 ES 16 IT 5 CHINA 3

44 Repositioning For Success Near-Term Cost Reduction Activities 50 3 Operational Restructuring Strategic Portfolio Evaluation

45 Strategic Portfolio Evaluation Management Actions P O R T F O L I O Strategic portfolio review Realigned SG&A investments and capital spending to support growth initiatives Presently evaluating strategic alternatives for three identified non-core operations in Germany Rotenburg Lage Lippstadt Due diligence phase and have a LOI on one of the assets Have received offers from a number of interested parties on a second

46 Summary DURA has a solid foundation to build on Superior quality Broad product portfolio and overall scale Customer diversity & Good Geographic Coverage Strong pipeline of innovation & growth opportunities Difficult second quarter results Near-term and long term initiatives in action to reposition the company for future success. Adequate liquidity to support both day-to-day operations and the operational restructuring plans. Determined to maintain our valued supplier and customer relationships. The entire DURA organization is aligned and confident in delivering the plan as scheduled.

47 Thank You Q&A