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BMV: RASSINI www.rassini.com 1 Third Quarter 2018 October 23, 2018
BMV: RASSINIwww.rassini.com
1
Third Quarter 2018October 23, 2018
First nine months of 2018 HighlightsMillion Pesos
• Net revenue climbed to $14,243 million or 5% YoY.
• EBITDA reached $2,536 million.
• Net operating cash flow was $1,592 million.
• Net Debt/annualized EBITDA ratio as of September 30 was 0.2x.
• EBITDA/Net Interest Expense ratio as of September 30 was 12.6x.
Consolidated Nine Months 2018 Results
(January 1- September 30)
2018(mill. Pesos)
2017(mill. Pesos)
% Change
Sales $14,243 $13,593 5%
Gross Profit $3,509 $3,451 2%
EBITDA $2,536 $2,530 0%
Net Income before taxes and
minority interest
$1,578 $1,493 6%
Net Income $1,132 $1,203 (6%)
2
Industry Update
Auto Show Detroit 2018
MacroeconomicsSeptember 2018
Ma
y 0
8
Se
p1
8
Housing Starts
Sources: Reuters, U.S. Bureau of Labor Statistics and Gas Buddy.
Exceeding a million homes for forty-two consecutive months
1.3eMillion of houses
5.4%
Unemployment 3.8%
Ma
y 0
8
Se
p1
8
3.8%
Fuel Cost $2.90 US$ / Gallon
$4.10
$2.50 $2.90
Ma
y0
8
De
c1
4
Se
p1
8
4
17.017.5 17.8
17.1
17.1 17.1 16.8
17.3
2014 2015 2016 2017 2018 2019 2020 2021
Actual
IHS Forecast / Sep'18
7.0 6.9 6.9 5.7 4.6 3.9
10.1 10.6 11.011.4
8.5 8.9
17.0 17.5 17.8 17.1
13.1 12.8
2014 2015 2016 2017 3Q17 3Q18Passenger Cars Light Trucks
U.S. Light Vehicle SAAR
Annual average
(2%)
Industry SnapshotMillion units
Expected Light Vehicle Production in North America
(2%)0% 3%
Source: IHS @ September’18
❑ U.S. SAAR reached 17.4 million units during September 2018.❑ Light vehicle production in North America is expected to reach
16.8 million units in 2020 according to the experts from IHS.❑ Inventories tracked 65 days of supply as of September 30, 2018.❑ Light Trucks production increased 5% vs previous year.
NAFTA Light Vehicle Production
Sep
5
14.4 15.5 16.4 17.4 17.5 17.2
17.4
8
10
12
14
16
18
20
22
J A J O J A J O J A J O J A J O J A J O J A J O J A J
2012 2013 2014 2015 2016 2017 2018
Country 2017 2018 2019 2020 2021
USA 11.0 11.0 11.1 11.1 11.9
CAN 2.2 2.0 2.0 1.8 1.8
MEX 3.9 4.0 4.0 3.8 3.6
NAFTA 17.1 17.1 17.1 16.8 17.3
0%
Brazilian Vehicle ProductionThousands of vehicles
By 2022 Brazil will reach 3.7 million units
Source: Sindipeças @Sep’18 6
Trucks and buses represent 86% of
RNA business
❑ During the first nine months of 2018, vehicle production increased 11%. ❑ Sindipeças expects total year-end 2018 production to increase 11% vs 2017 with
approximately 5% annual growth during the following years.
2,502
2,018 1,778
2,269 2,486 2,617 2,743 2,889 3,038
471
316
299
327
379 391
401 418
449
140
74
61
79
99 105
111 116
134
33
23
19
21
27 27
29 30
35 3,146
2,431
2,157
2,696 2,991
3,140 3,284
3,453 3,656
2014 2015 2016 2017 2018e 2019e 2020e 2021e 2022e
Passenger Cars Light Commercials Trucks Buses
Passenger Cars
83%
Light
Commercials
13%
Trucks
3%
Buses
1%
Consolidated FinancialHighlights
7
MxP/USD Sep'17 Sep'18
End 18.20 18.81
Average 18.93 19.04
Consolidated Sales and EBITDA Million Pesos
8
9,353 9,392 10,362
11,900 12,897
16,340
18,104
13,593 14,243
1,178 1,203 1,343
1,568
2,141
3,190 3,366
2,530 2,536
11 12 13 14 15 16 17 Jan - Sep'17
Jan - Sep'18
Sales EBITDA
CAGR '12-'17
Sales 14%
EBITDA 23%
2,530 2,437
93
2,536 2,375
161
Consolidated Rassini NAFTA Brazil*
(3%)
74%
EBITDA
Sales
YTD Sales and EBITDA by Region Million Pesos
9* EBITDA before Fees and Royalties
13,59312,197
1,396
14,24312,672
1,571
Jan-Sep '17 Jan-Sep '18
5%
4%
13%
Actual dist. Sales
NAFTA 89%
Brazil 11%
Consolidated 100%
Actual dist. EBITDA
NAFTA 94%
Brazil 6%
Consolidated 100%
0%
Sales by Product and Region
Consolidated Sales BreakdownMillion Pesos
10
US OEMs 76%
Asian OEMs8%
European OEMs
7%
Aftermarket2%
Trailers Brazil 1%
Other 6%
Sales distribution by customer
OEM: Original Equipment Manufacturer
2017 % 2018 %
Leaf Springs (1) 6,681 49 6,747 47
Coil Springs 1,329 10 1,213 9
NAFTA Suspensions 8,010 59 7,960 56
Brakes (1) 4,187 31 4,712 33
TOTAL NAFTA 12,197 90 12,672 89
Leaf Springs (1) 1,191 9 1,360 10
BRAZIL Coil Springs 205 2 211 1
TOTAL BRAZIL 1,396 10 1,571 11
CONSOLIDATED SALES 13,593 100 14,243 100
(1) Includes elimination of intercompany transactions.
Jan-Sep Jan-Sep
Consolidated Income Statement Million Pesos
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Consolidated Jan-Sep Jan-Sep % Var
Income Statement 2017 2018 18/17
Net Sales 13,592.6 14,242.5 5
Cost of sales 10,141.6 10,733.7 (6)
Gross Profit 3,451.0 3,508.8 2
% of sales 25 25
SG&A 920.7 973.2 (6)
EBITDA 2,530.3 2,535.6 0
% of sales 19 18
Depreciation 570.3 602.9 (6)
Interest & other financial charges 238.3 191.0 20
Other expenses 228.8 164.2 28
Income before Taxes & Minority Int. 1,492.9 1,577.5 6
Taxes & Deferred Taxes 372.7 473.4 (27)
Minority Interest (82.8) (27.8) 66
Net Income 1,203.0 1,131.9 (6)
Consolidated Cash FlowMillion Pesos
12
Consolidated Jan-Sep Jan-Sep % Var
Cash Flow 2017 2018 18/17
EBITDA 2,530.3 2,535.6 0
Working Capital and Taxes (761.9) (943.6)
Net operating cash flow 1,768.4 1,592.0 (10)
Interest expense (170.5) (155.0)
Cash flow after int. expense 1,597.9 1,437.0 (10)
Capex (622.9) (696.9)
Cash flow available for debt service 975.0 740.1 (24)
Financing & Debt Amortization (374.8) (660.0)
Dividends paid (640.3) (800.3)
Other (385.9) (236.0)
Beginning cash balance 1,913.1 1,990.6
Ending cash balance 1,487.1 1,034.4 (30)
Short Term
Current
Portion
LTD
Long
Term Total
Suspension Division NA 8.4 25.0 6.3 39.7
Brakes Division 2.0 9.0 18.0 29.0
Suspension Division Brazil 26.8 - 0.0 26.8
TOTAL 37.2 34.0 24.3 95.5
As of End ofSeptember 2018
Cash balance Sep’18 = US$55 mill.Net Debt Sep’18 = US$41 mill.
Consolidated Debt Million US dollars
13
9.08.5
34.0
6.8
2018 2019 2020 2021
Long Term Debt Amortization ProfileUS$ Million
NAFTA Suspensions Brakes
Note: Debt profile does not include working capital financings
11.0
15.6
1.3
12.6
15.6
2.9
Consolidated North America Brazil *
15%
0%
123%
Net debt / EBITDA
EBITDA / Net interest
Financial Ratios by Region (Times)
* EBITDA before Fees and Royalties 14
0.3 0.3
4.2
0.2 0.2
2.3
Sep'17 Sep'18
28% 51%
46%
Appendix
BMV: RASSINI
www.rassini.com
What defines Rassini…
World’s largest producer ofsuspension components for lightcommercial vehicles
Largest fully integrated brakedisc producer in the Americas
Leader in technology and marketshare designing and producingsuspension components and highperformance brake rotors.
Within the Top 100 North Americansuppliers by Automotive News.
Recognized year after year for ouroperational excellence.
16
57%
Leaf Springs
33%
Brakes
Coil Springs
10%
Silverado
Bushings
Motor balancersClutch plates
Spacers
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• Leaf Springs and Coil SpringSão Bernardo do Campo, São Paulo
Mexico
• BrakesSan Martin, Puebla
• Leaf Springs and Coil SpringsPiedras Negras, Coahuila
• Leaf SpringsXalostoc, Estado de Mexico
• Elastomers and Bushing AssembliesSan Juan del Rio, Queretaro
• HeadquartersMexico City
• Coil SpringsMontpelier, Ohio
• BrakesFlint, Michigan
• Sales , Engineering, Researchand Development
Plymouth, Michigan
Brazil
• Leaf SpringsNova Iguacu, Rio de Janeiro
USA• Engineering Office
Stuttgart, Germany
• Engineering OfficeTokyo, Japan
5 R&D Centers
Plants around the world
Operating divisions
84
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Juan Pablo Sánchez
Berenice Muñoz
Edgar Landeros
Carlos Redondo
CFO
Financial Planning Manager & IR
Financial Planning & IR
Financial Analyst & IR
BMV: RASSINI
www.rassini.com
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