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Standard Motor Products, Inc. Annual Meeting of Shareholders May 21, 2009. 2009 Annual Meeting of Shareholders. Larry Sills, Chairman and CEO Jim Burke, VP Finance & CFO. Forward Looking Statements.
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Standard Motor Products, Inc. • Annual Meeting of Shareholders • May 21, 2009
2009 Annual Meeting of Shareholders • Larry Sills, Chairman and CEO • Jim Burke, VP Finance & CFO
Forward Looking Statements • You should be aware that except for historical information, the matters discussed herein are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward looking statements, including projections and anticipated levels of future performance, are based on current information and assumptions and involve risks and uncertainties which may cause actual results to differ materially from those discussed herein. You are urged to review our filings with the SEC and our press releases from time to time for details of these risks and uncertainties.
Larry Sills Chairman and Chief Executive Officer
Aftermarket versus OE SMP is an aftermarket company • There are major differences • Aftermarket • Original Equipment Market
Aftermarket versus OE • Aftermarket • Based on 250 million vehicles on the road • Highly stable • Slow and steady growth • Tens of thousands of SKUs • OE • Based on new car production • Minimal number of SKUs • High degree of automation
Current Operating Environment • Favorable Macro Trends for Aftermarket • New Car Sales Down • Aging Fleet of Vehicles • Car Dealerships Closing • Leasing Availability Down • Fuel Prices Down • Commodity Prices Coming Down
Jim Burke Vice President and Chief Financial Officer
SMP Overview – 40,000 Foot View • Stable Revenues – $700 to $800 MM • Restructuring Efforts – Maintain Global Competitiveness • 2003-2005 • Dana Integration • 2006-2007 • Exit UK Manufacturing • Establish Low Cost Poland Manufacturing Site • 2007-2008 • REMFG Compressors to Reynosa, MX • Puerto Rico & LIC, NY MFG to Reynosa, MX
Restructuring Impact on EBITDA • Restructuring Impact on EBITDA w/o Special Items • Key Takeaway is the Health of our Core Business in the $45-50 MM Range Excluding Integration Years
Key Priorities • Generate Cash • Reduce Debt • Redeem Convertible Debentures • Original Issue $90 MM • 6.75% Coupon • 10 Year Life • Due July 15, 2009
Key Priorities • 2008 Actions • Generate Cash/Reduce Debt • Sale of LIC HQ Building • Reduced Inventory by $20 MM • Reduced AR • Closed DC in Reno • Reduced Headcount • Total Debt Reduction in 2008 $61 MM • Repurchased $45 MM Bonds at Discount
Key Priorities • 2009 Actions • Generate Cash/Reduce Debt • Reduced Inventory by $27 MM • Additional AR Reduction • Suspend 2009 Quarterly Dividend • 2009 Salary Increase Eliminated • Capex Reduction • Early Retirement Program • Debt Reduction Through April $26 MM
Key Priorities • 2009 Actions • May 6, 2009 exchanged $12.3 MM old bonds for new bonds • Coupon 15% • Due April 15, 2011 • Strike Price $15.00
Key Priorities • The Result of 2008 and 2009 Actions • Remaining $32 MM Bonds Will Be Retired on Schedule – July 15, 2009 • Debt : EBITDA Ratio Significantly Improved
Plans For Future • Expand Low Cost Manufacturing • Expand Low Cost Purchasing • New Business
Accomplishments and Trends • Low Cost Manufacturing 46% 38% 29% 16% 2005 2007 2008 2009 Estimate % production labor hours in low cost facilities
Accomplishments and Trends • Low Cost Purchasing 50% 47% 42% 38% 2005 2007 2008 2009 Estimate % purchased from low cost suppliers
Accomplishments and Trends • New Business • Wire and Cable • Acquired FM Wire & Cable Product Line • New Aftermarket Business • Engine Management • Temperature Controls
Thank You • Standard Motor Products, Inc. • Annual Meeting of Shareholders • May 21, 2009