BMV: RASSINI www.rassini.com First Half 2018 July 24, 2018 1
First Half 2018 Highlights Net revenue climbed to $9,488 million pesos. EBITDA reached $1,787 million pesos. Net income was $816 million pesos. Net Debt/annualized EBITDA ratio as of 1 st H 18 was 0.3x. EBITDA/Net Interest Expense ratio as of 1 st H 18 was 12.8x. Consolidated 2018 (mill. Pesos) First Half 2018 Results (January 1- June 30) 2017 (mill. Pesos) % Change Sales $9,488 $9,369 1% Gross Profit $2,408 $2,466 (2%) EBITDA $1,787 $1,851 (3%) Net Income before taxes and $1,119 $1,140 (2%) minority interest Net Income $816 $876 (7%) 2
Industry Update Auto Show Detroit 2018
May 08 Dec 14 Jun 18 May 08 Jun 18 May 08 Jun 18 Housing Starts 1.2 Million of houses Macroeconomics June 2018 Unemployment 3.8% 5.4% 3.8% Exceeding a million homes for thirty-nine consecutive months $4.10 Fuel Cost $2.90 US$ / Gallon $2.50 $2.90 Sources: Reuters, U.S. Bureau of Labor Statistics and Gas Buddy. 4
22 20 18 16 U.S. Light Vehicle SAAR 15.2 15.5 16.9 17.4 17.5 17.8 Annual average Jun 17.5 Industry Snapshot Million units Expected Light Vehicle Production in North America 17.0 17.5 17.8 17.1 1% 1% 17.2 0% 17.4 17.4 14 12 Country 2017 2018 2019 2020 USA 11.0 11.1 11.3 11.5 CAN 2.2 2.0 2.0 1.8 MEX 3.9 4.1 4.2 4.1 NAFTA 17.1 17.2 17.4 17.4 10 Actual 8 J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M 2012 2013 2014 2015 2016 2017 2018 NAFTA Light Vehicle Production 17.0 17.5 17.8 17.1 (3%) 10.1 10.6 11.0 11.4 9.0 8.8 5.7 6.0 7.0 6.9 6.9 5.7 3.2 2.7 IHS Forecast / Jun'18 2014 2015 2016 2017 2018 2019 2020 U.S. SAAR reached 17.5 million units during June 2018. Light vehicle production in North America is expected to reach 17.4 million units in 2020 according to the experts from IHS. Inventories tracked 68 days of supply as of June 30, 2018. Light Trucks production increased 5% vs previous year. 2014 2015 2016 2017 1H17 1H18 Passenger Cars Light Trucks Source: IHS @ June 18 5
3,146 33 140 471 Passenger Cars Light Commercials Trucks Buses 2,431 23 74 316 2,157 19 61 299 2,696 3,010 28 21 98 79 382 327 3,154 29 101 394 3,281 30 106 402 3,456 30 112 434 Brazilian Vehicle Production Thousands of vehicles 3,629 35 128 447 Trucks and buses represent 86% of RNA business 2,502 2,018 1,778 2,269 2,502 2,630 2,743 2,880 3,019 Light Commercials 12% Trucks 3% Buses 1% 2014 2015 2016 2017 2018e 2019e 2020e 2021e 2022e By 2022 Brazil will reach 3.6 million units Passenger Cars 84% During 1st H 18, vehicle production increased 14% and vehicle exportation experienced 1% growth compared to the same period in 2017. Sindipeças expects 2018 production to increase 12% vs 2017 with approximately 5% annual growth during the following years. Source: Sindipeças @Jun 18 6
Consolidated Financial Highlights MxP/USD Jun'17 Jun'18 End 17.90 19.86 Average 19.50 19.07 7
Consolidated Sales and EBITDA Million Pesos 18,104 Sales EBITDA 10,362 9,353 9,392 11,900 12,897 16,340 3,190 3,366 CAGR '12-'17 Sales 14% EBITDA 23% 9,369 9,488 2,141 1,178 1,203 1,343 1,568 1,851 1,787 11 12 13 14 15 16 17 Jan - Jun '17 Jan - Jun '18 8
Sales YTD Sales and EBITDA by Region Million Pesos Jan-Jun '17 Jan-Jun '18 9,369 9,488 8,503 8,413 Actual dist. Sales NAFTA 89% Brazil 11% Consolidated 100% 24% 1% -1% 866 1,075 EBITDA (3%) (7%) 1,851 1,787 1,808 1,675 Actual dist. EBITDA NAFTA 94% Brazil 6% Consolidated 100% 160% 43 112 Consolidated Rassini NAFTA Brazil* * EBITDA before Fees and Royalties 9
Sales by Product and Region Jan-Jun Jan-Jun 2017 % 2018 % Consolidated Sales Breakdown Million Pesos Sales distribution by customer Leaf Springs (1) 4,659 50 4,426 47 Coil Springs 930 10 813 9 NAFTA Suspensions 5,589 60 5,239 55 Brakes (1) 2,914 31 3,174 33 TOTAL NAFTA 8,503 91 8,413 89 Trailers Brazil 1% Aftermarket 2% Other 6% European OEMs 7% Asian OEMs 9% US OEMs 75% Leaf Springs (1) 735 8 936 10 BRAZIL Coil Springs 131 1 139 1 TOTAL BRAZIL 866 9 1,075 11 OEM: Original Equipment Manufacturer CONSOLIDATED SALES 9,369 100 9,488 100 (1) Includes elimination of intercompany transactions. 10
Consolidated Income Statement Million Pesos Consolidated Jan-Jun Jan-Jun % Var Income Statement 2017 2018 18/17 Net Sales 9,368.9 9,487.7 1 Cost of sales 6,903.4 7,079.8 (3) Gross Profit 2,465.5 2,407.9 (2) % of sales 26 25 SG&A 614.2 620.9 (1) EBITDA 1,851.3 1,787.0 (3) % of sales 20 19 Depreciation 401.8 400.0 0 Interest & other financial charges 159.3 135.0 15 Other expenses 150.6 132.7 12 Income before Taxes & Minority Int. 1,139.6 1,119.3 (2) Taxes & Deferred Taxes 328.4 322.9 2 Minority Interest (65.1) (19.1) 71 Net Income 876.3 815.5 (7) 11
Consolidated Cash Flow Million Pesos Consolidated Jan-Jun Jan-Jun % Var Cash Flow 2017 2018 18/17 EBITDA 1,851.3 1,787.0 (3) Working Capital and Taxes (484.7) (573.9) Net operating cash flow 1,366.6 1,213.1 (11) Interest expense (113.9) (108.2) Cash flow after int. expense 1,252.7 1,104.9 (12) Capex (388.0) (478.7) Cash flow available for debt service 864.7 626.2 (28) Financing & Debt Amortization (182.4) (505.8) Dividends paid - (800.3) Other (496.4) (245.5) Beginning cash balance 1,913.1 1,990.6 Ending cash balance 2,099.0 1,065.2 (49) 12
As of End of June 2018 Short Term Current Portion LTD Long Term Total Consolidated Debt Million US dollars Suspension Division NA 8.4 25.0 12.5 45.9 Brakes Division 2.0 9.0 20.3 31.3 Cash balance Jun 18 = US$54 mill. Net Debt Jun 18 = US$51 mill. Suspension Division Brazil 27.0 - - 27.0 TOTAL 37.4 34.0 32.8 104.2 Long Term Debt Amortization Profile US$ Million 17.0 34.0 9.0 6.8 2018 2019 2020 2021 NAFTA Suspensions Brakes Note: Debt profile does not include working capital financings 13
Financial Ratios by Region (Times) Net debt / EBITDA Jun'17 Jun'18 63% 6.0 (76%) 37% 0.2 0.3 0.3 0.2 2.2 EBITDA / Net interest -8% 6% 12.1 12.8 17.4 16.0 233% 0.9 3.0 Consolidated North America Brazil * * EBITDA before Fees and Royalties 14
Appendix BMV: RASSINI www.rassini.com
What defines Rassini World s largest producer of suspension components for light commercial vehicles Largest fully integrated brake disc producer in the Americas Leader in technology and market share designing and producing suspension components and high performance brake rotors. Within the Top 100 North American suppliers by Automotive News. Recognized year after year for our operational excellence. 16
Brakes Motor balancers Clutch plates Spacers 33% Bushings Leaf Springs 57% Silverado Coil Springs 10% 17
8 4 Plants around the world Operating divisions Mexico Leaf Springs and Coil Springs Piedras Negras, Coahuila Leaf Springs Xalostoc, Estado de Mexico Elastomers and Bushing Assemblies San Juan del Rio, Queretaro Brakes San Martin, Puebla Headquarters Mexico City USA Coil Springs Montpelier, Ohio Sales, Engineering, Research and Development Plymouth, Michigan Brakes Flint, Michigan Brazil Leaf Springs and Coil Spring São Bernardo do Campo, São Paulo Leaf Springs Nova Iguacu, Rio de Janeiro Engineering Office Stuttgart, Germany 5 R&D Centers Engineering Office Tokyo, Japan 18
Juan Pablo Sánchez Emma Bocanegra Edgar Landeros CFO Financial Planning & IR Financial Analyst & IR jsanchez@rassini.com ebocanegra@rassini.com elanderos@rassini.com BMV: RASSINI www.rassini.com
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