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Forward-Looking 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. In particular, this presentation contains forward-looking statements about Company estimates for future periods with respect to cost savings, restructuring charges, revenues or other financial information. 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 on historical trends, current conditions, expected future developments and other factors it believes are appropriate under the circumstances. Actual results may differ materially from the anticipated results because of certain risks and uncertainties, including but not limited to: (i) general economic or business conditions affecting the markets in which the Company serves; (ii) the Company's ability to develop or successfully introduce new products; (iii) risks associated with conducting business in foreign countries and currencies; (iv) increased competition in the heavy-duty truck market and other key end markets; (v) our failure to complete or successfully integrate additional strategic acquisitions; (vi) the impact of changes in governmental regulations on the Company's customers or on its business; (vii) the loss of business from a major customer or the discontinuation of particular commercial vehicle platforms; (viii) the Companys ability to obtain future financing due to changes in the lending markets or its financial position; (ix) our ability to comply with the financial covenants in our revolving credit facility; and (x) various other risks as outlined in CVGs SEC filings. There can be no assurance that statements made in this presentation relating to future events will be achieved. CVG undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time. All subsequent written and oral forward-looking statements attributable to CVG or persons acting on behalf of CVG are expressly qualified in their entirety by such cautionary statements. For a complete description of risks, please refer to our 2010 Annual Report on Form 10-K and current SEC reports on file. 2
Agenda
Welcome The Year in Review / Moving Ahead Managing for the Future Financial Review Closing Questions
Realigning our manufacturing footprint through facility consolidations Achieving new business awards Capitalizing on our variable cost structure and improving our bottom line Strategic acquisitions and new market opportunities
Bostrom Seating Exploring India Opportunities Exploring Brazil Opportunities
2010
$21.4 million cash tax refund during the second quarter of 2010
$250 million bond offering in April 2011 at 7.875% (due in 2019) Stock Offering + Tax Refund + Revolver Capacity + Bond Offering = Strong Balance Sheet / Liquidity
Moving Ahead - New Business Success Strong Pipeline of New Business Achievements
Daimler Trucks North America (DTNA) Seats, Flooring, Interior Components Beiqi Foton Motor Co Truck Seats ($30m sales at full production) XCMG Seat Supplier ($4-6m sales) John Deere Wire Harnesses for Excavators Manufactured in China ($4-4.5m sales) Hino Seat Supplier for Medium-duty Trucks Manufactured in North America ($23m sales) Skoda Auto Wire Harnesses ($14-17m sales)
Managing for the Future - Continuous Improvement and Growth Moving forward, our focus will remain on:
Capitalizing on Strong End Market Recovery and Growth Truck/Construction Geographic Diversification organic & acquisition Mexico Opportunities China Opportunities India Opportunities Brazil Opportunities U.S. Opportunities End Market Diversification - organic & acquisition Investment in Technology
Early stages of penetration into large Asian commercial vehicle market Growth opportunities in Asia with strong production volumes Continued growth in China Opportunity in other emerging markets (India, Russia, South America, etc.) New business wins with new and existing 12 customers
09-15 CAGR
8.0%
12.3%
1,326
837
860
937
8.4%
6.6% 6.6%
2009
2010
2011
North America
2012
Europe Asia
2013
South America
2014
2015
Other 10%
Agriculture 1%
Construction 23%
Source: Millmark Associates (January 2011) Note: Revenue breakdown based on 2010 results.
Managing for the Future - Global and Expanding Footprint Medium\ Heavy Truck Production 2010 | 2015 All Regions
* Based on Market Research Untapped Medium / Heavy Truck Markets represent CVGs largest opportunity for content through 1.3M vehicles in China, 384K vehicles in India and 230K vehicles in Brazil by 2015
Managing for the Future - Global and Expanding Footprint Medium\ Heavy Construction Production 2010 | 2014 All Regions
* Based on Market Research Construction market growth from 2010 to 2014 shows China and India as CVGs largest opportunity to increase content along with continued focus on North American increased content and Western Europe and Japan
Managing for the Future - Global and Expanding Footprint Agriculture Equipment Production 2010 | 2014 - All Regions
* Based on Market Research Agriculture market growth from 2010 to 2014 represent CVGs largest opportunity for content through 762K vehicles in China and 640K vehicles in India, along with continued focus on increasing North American content and growth in Brazil, Europe and Japan
Advanced Seating
Financial Overview
Financial Review
Global industry recession continued to challenged the business through 2009 with signs of recovery in 2010 and in early 2011 Continued improvement in financial results on a sequential quarter-over-quarter basis last eight quarters Continue to drive culture of entrepreneurship, innovation and employee engagement to improve our bottom line
Financial Review - Strong Liquidity and Maturity Profile Strong Balance Sheet & Liquidity Q1 2010 Equity Offering Q2 2010 Tax Refund April 2011 $250 million bond offering:
Financial Review Track Record of Disciplined, Successful Investment & Growth Strategy Pursue additional new business and conquest business wins
Continue to monitor competitors operating in a distressed state for additional opportunities Invest in new processes or capabilities
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Acquisition of Acquisition of National R-Squared Seating Acquisition of Tempress, Acquisition of Sprague Inc. Device (Prutsman / Motomirror) Acquisition of KAB Seating
Sale of Monona Medical Harness Acquisition of CIEB Groundbreaking of CVG Corporate Headquarters
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Appendix
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Historical Measures Non-GAAP Non-GAAP Measures Adjusted EBITDA and Adjusted Operating Reconciliation to Adjusted Operating IncomeIncome
Fiscal Year Ending December 31 2005 Operating Income Long-lived asset impairment Goodwill and intangible asset impairment Restructuring Charges Adjusted Operating Income
Source: Company filings
Fiscal Quarter Ending 2009 (89.7) $ 17.3 30.1 3.7 (38.6) $ 2010 16.7 1.7 18.4 $ $ 3/31/09 (18.4) $ 1.7 (16.7) $ 6/30/09 (22.2) $ 3.4 7.0 0.2 (11.6) $ 9/30/09 (7.8) $ (7.8) $ 12/31/09 (41.2) $ 13.8 23.1 1.7 (2.6) $ 3/31/10 3.6 $ 3.6 $ 6/30/10 2.6 $ 1.4 4.0 $ 9/30/10 5.1 $ 0.2 5.3 $ 12/31/10 5.4 $ 0.2 5.5 $ 3/31/11 8.1 0.3 8.4
89.5 $ -
89.5 $
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