EX-99.(B) 4 k84775exv99wxby.txt PRESENTATION MADE ON EARNINGS CONFERENCE CALL EXHIBIT 99b FISCAL YEAR 2004 2ND QUARTER EARNINGS CONFERENCE CALL Larry Yost, Chairman and CEO Carl Soderstrom, Senior Vice President and CFO APRIL 23, 2004 (ARVINMERITOR LOGO) (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL FORWARD-LOOKING STATEMENTS This presentation contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on currently available competitive, financial and economic data and management's views and assumptions regarding future events. Such forward-looking statements are inherently uncertain, and actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to global economic and market conditions; the demand for commercial, specialty and light vehicles for which the company supplies products; risks inherent in operating abroad, including foreign currency exchange rates; availability and cost of raw materials; OEM program delays; demand for and market acceptance of new and existing products; successful development of new products; reliance on major OEM customers; labor relations of the company, its customers and suppliers; successful integration of acquired or merged businesses; achievement of the expected annual savings and synergies from past and future business combinations; competitive product and pricing pressures; the amount of the company's debt; the ability of the company to access capital markets; the credit ratings of the company's debt; the outcome of existing and any future legal proceedings, including any litigation with respect to environmental or asbestos-related matters; as well as other risks and uncertainties, including but not limited to those detailed herein and from time to time in ArvinMeritor's Securities and Exchange Commission filings. 2 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL 2ND QUARTER INCOME STATEMENT
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS) QUARTER ENDED MARCH 31, ------------------------------------------------- BETTER/(WORSE) --------------------- 2004 2003 $ % ---- ---- - - SALES $ 2,254 $ 1,993 $ 261 13% COST OF SALES (2,053) (1,807) (246) -14% ------- ------- ------- GROSS MARGIN 201 186 15 8% SG&A (124) (114) (10) -9% GAIN ON DIVESTITURES 20 2 18 900% RESTRUCTURING COSTS (8) (11) 3 27% ENVIRONMENTAL REMEDIATION COSTS (8) -- (8) ------- ------- ------- OPERATING INCOME 81 63 18 29% EQUITY IN EARNINGS OF AFFILIATES 5 1 4 400% INTEREST EXPENSE, NET AND OTHER (25) (27) 2 7% ------- ------- ------- INCOME BEFORE INCOME TAXES 61 37 24 65% PROVISION FOR INCOME TAXES (16) (12) (4) -33% MINORITY INTERESTS (4) (1) (3) -300% ------- ------- ------- NET INCOME $ 41 $ 24 $ 17 71% ======= ======= ======= DILUTED EPS $ 0.59 $ 0.36 $ 0.23 64% ======= ======= ======= OPERATING MARGIN 3.6% 3.2% 0.4 PTS
3 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL 2ND QUARTER SEGMENT SALES
(IN MILLIONS) QUARTER ENDED MARCH 31, ----------------------------------------- BETTER/(WORSE) ------------------- 2004 2003 $ % ---- ---- - - SALES LIGHT VEHICLE SYSTEMS NORTH AMERICA $ 523 $ 534 $ (11) -2% EUROPE 606 522 84 16% SOUTH AMERICA 44 39 5 13% ASIA-PACIFIC AND OTHER 66 69 (3) -4% ------ ------ ------ TOTAL 1,239 1,164 75 6% COMMERCIAL VEHICLE SYSTEMS NORTH AMERICA 470 350 120 34% EUROPE 210 173 37 21% SOUTH AMERICA 30 19 11 58% ASIA-PACIFIC AND OTHER 59 47 12 26% ------ ------ ------ TOTAL 769 589 180 31% LIGHT VEHICLE AFTERMARKET NORTH AMERICA 134 143 (9) -6% EUROPE 51 51 -- 0% SOUTH AMERICA 7 4 3 75% ASIA-PACIFIC AND OTHER 7 6 1 17% ------ ------ ------ TOTAL 199 204 (5) -2% OTHER - NORTH AMERICA 47 36 11 31% ------ ------ ------ TOTAL $2,254 $1,993 $ 261 13% ====== ====== ======
4 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL 2ND QUARTER SEGMENT OPERATING INCOME
(IN MILLIONS) QUARTER ENDED MARCH 31, ------------- -------------------------------------------- BETTER/(WORSE) -------------- 2004 2003 $ % ---- ---- - - OPERATING INCOME LIGHT VEHICLE SYSTEMS (1) $ 46 $ 29 $ 17 59% COMMERCIAL VEHICLE SYSTEMS 38 29 9 31% LIGHT VEHICLE AFTERMARKET (3) 6 (9) -150% OTHER -- (1) 1 100% ------- ------- ---- TOTAL OPERATING INCOME $ 81 $ 63 $ 18 29% ======= ======= ==== OPERATING MARGIN LIGHT VEHICLE SYSTEMS 3.7% 2.5% 1.2 PTS COMMERCIAL VEHICLE SYSTEMS 4.9% 4.9% -- PTS LIGHT VEHICLE AFTERMARKET -1.5% 2.9% (4.4) PTS OTHER 0.0% -2.8% 2.8 PTS TOTAL OPERATING MARGIN 3.6% 3.2% 0.4 PTS
(1) INCLUDES A GAIN ON THE SALE OF THE RIDE CONTROL JOINT VENTURE OF $20 MILLION AND ENVIRONMENTAL REMEDIATION COSTS OF $8 MILLION IN THE QUARTER ENDED MARCH 31, 2004. 5 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL BALANCE SHEET HIGHLIGHTS
(IN MILLIONS) MAR. 31, DEC. 31, SEPT. 30, JUNE 30, MAR. 31, 2004 2003 2003 2003 2003 ---- ---- ---- ---- ---- CASH $ 119 $ 137 $ 103 $ 103 $ 121 ======= ======= ======= ======= ======= SHORT-TERM DEBT $ 3 $ 12 $ 20 $ 12 $ 9 LONG-TERM DEBT 1,527 1,572 1,541 1,562 1,474 ------- ------- ------- ------- ------- TOTAL DEBT $ 1,530 $ 1,584 $ 1,561 $ 1,574 $ 1,483 ======= ======= ======= ======= ======= MINORITY INTERESTS 68 73 64 73 66 EQUITY 1,051 1,024 899 1,040 885 TOTAL DEBT TO CAPITAL 58% 59% 62% 59% 61% NET DEBT (1) 1,652 1,740 1,742 1,823 1,747 WORKING CAPITAL (2) 419 380 278 270 84 FACTORED RECEIVABLES 16 70 47 89 95 SECURITIZED RECEIVABLES 225 223 237 263 290 NON-CASH WORKING CAPITAL (3) 660 673 562 622 469 WORKING CAPITAL % OF SALES (4) 7.7% 8.1% 7.2% 8.2% 6.4%
(1) NET DEBT IS CALCULATED AS TOTAL DEBT PLUS FACTORED AND SECURITIZED RECEIVABLES LESS CASH. (2) EXCLUDES CASH AND SHORT TERM DEBT. (3) INCLUDES ACCOUNTS RECEIVABLE SECURITIZATION AND FACTORED RECEIVABLES. (4) BASED ON LAST TWELVE MONTHS' SALES. 6 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL CASH FLOW HIGHLIGHTS
(IN MILLIONS) SIX MONTHS ENDED MARCH 31, ------------- -------------------------- 2004 2003 ---- ---- NET INCOME $ 60 $ 56 ADJUSTMENTS TO INCOME: DEPRECIATION AND AMORTIZATION 112 103 GAIN ON SALE OF MARKETABLE SECURITIES (7) -- RESTRUCTURING COSTS, NET OF EXPENDITURES (2) 3 GAIN ON DIVESTITURES (20) (2) PENSION AND RETIREE MEDICAL EXPENSE 66 48 PENSION AND RETIREE MEDICAL CONTRIBUTIONS (44) (102) CHANGES IN ASSETS AND LIABILITIES (104) (50) ----- ----- CASH PROVIDED BY OPERATIONS (EX. AR SECUR. AND FACTORING) 61 56 ACCOUNTS RECEIVABLE SECURITIZATION AND FACTORED RECEIVABLES (27) 180 ----- ----- CASH PROVIDED BY OPERATING ACTIVITIES $ 34 $ 236 ===== ===== CAPITAL EXPENDITURES $ (71) $ (69) ACQUISITIONS OF BUSINESSES AND INVESTMENTS, NET OF CASH ACQUIRED -- (91) PROCEEDS FROM DISPOSITIONS OF PROPERTY AND BUSINESSES 71 42 PROCEEDS FROM SALE OF MARKETABLE SECURITIES 18 -- ----- ----- CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES $ 18 $(118) ===== ===== NET CHANGE IN REVOLVING DEBT $ (23) $ (50) NET CHANGE IN OTHER DEBT (9) -- ----- ----- NET DECREASE IN DEBT (32) (50) PROCEEDS FROM THE EXERCISE OF STOCK OPTIONS 5 -- CASH DIVIDENDS (14) (13) ----- ----- CASH USED FOR FINANCING ACTIVITIES $ (41) $ (63) ===== =====
7 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL FY 2004 LIGHT VEHICLE PRODUCTION OUTLOOK
(IN MILLIONS) FISCAL YEAR ENDED SEPTEMBER 30 CALENDAR Q1 Q2 Q3 Q4 FULL YEAR YEAR -- -- -- -- --------- ---- NORTH AMERICA 2004 OUTLOOK 3.9 4.1 4.3 3.8 16.1 16.1 2003 ACTUAL 3.9 4.2 4.2 3.7 16.0 16.0 CHANGE 0% -2% 2% 3% 1% 1% WESTERN EUROPE (1) 2004 OUTLOOK 4.1 4.3 4.4 3.8 16.6 16.7 2003 ACTUAL 4.2 4.4 4.4 3.7 16.7 16.6 CHANGE -2% -2% 0% 3% -1% 1%
(1) - INCLUDES CZECH REPUBLIC SOURCE: CSM WORLDWIDE, INC. 8 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL LIGHT VEHICLE SYSTEMS NET NEW BUSINESS (IN MILLIONS)
SALES ----------------------------------------------------------------------- IMPLIED ACTUAL INCREMENTAL ANNUAL 2003 2004 2005 2006 CUMULATIVE GROWTH ---- ---- ---- ---- ---------- ------ $4,355 $ 235 $ 215 $ 120 $ 570 4%
9 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL FY 2004 COMMERCIAL VEHICLE PRODUCTION OUTLOOK
(IN THOUSANDS) FISCAL YEAR ENDED SEPTEMBER 30 CALENDAR Q1 Q2 Q3 Q4 FULL YEAR YEAR -- -- -- -- --------- ---- NORTH AMERICA - CLASS 8 TRUCKS (1) 2004 OUTLOOK 47 53 63 64 227 243 2003 ACTUAL 41 35 43 45 164 170 CHANGE 15% 51% 47% 42% 38% 43% WESTERN EUROPE - HEAVY & MEDIUM TRUCKS 2004 OUTLOOK 95 92 95 85 367 360 2003 ACTUAL 98 93 92 81 364 361 CHANGE -3% -1% 3% 5% 1% 0%
(1) - INCLUDES U.S., CANADA AND MEXICO SOURCE: WESTERN EUROPE - GLOBAL INSIGHT 10 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL FY 2004 SALES OUTLOOK
(IN MILLIONS) FY 2004 FULL YEAR OUTLOOK ------------------------------------- SALES FY 2003 $ 7,788 $ 7,788 ------- ------- LIGHT VEHICLE SYSTEMS 455 -- 470 COMMERCIAL VEHICLE SYSTEMS 683 -- 698 LIGHT VEHICLE AFTERMARKET (5) -- 5 OTHER 19 -- 19 ------- ------- TOTAL CHANGE 1,152 -- 1,192 ------- ------- SALES FY 2004 $ 8,940 -- $ 8,980 ======= =======
11 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL FULL YEAR FY 2004 OUTLOOK
(IN MILLIONS, EXCEPT EPS) FY 2003 FY 2004 FULL YEAR FULL YEAR OUTLOOK (2) --------- ---------------------------------- SALES $ 7,788 $ 8,940 - $ 8,980 ========= ========= ========= OPERATING MARGIN 4.0% 3.5% - 3.6% ========= ========= ========= NET INCOME BEFORE ACCTG. CHANGE(1) $ 140 $ 150 - $ 165 ========= ========= ========= DILUTED EPS BEFORE ACCTG. CHANGE(1) $ 2.06 $ 2.20 - $ 2.40 ========= ========= =========
NOTE (1): FY 2003 EXCLUDES THE CUMULATIVE EFFECT OF AN ACCOUNTING CHANGE DUE TO THE ADOPTION OF FIN 46 OF $4 MILLION ($0.06 PER DILUTED SHARE). NOTE (2): OUTLOOK DOES NOT INCLUDE THE IMPACT OF ANY FUTURE ACQUISITIONS OR DIVESTITURES. 12 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL PLANNED FACILITY CLOSURES AND WORKFORCE REDUCTION COSTS AND SAVINGS
(IN MILLIONS) ACTUAL FISCAL YEAR 2004 FORECAST ------------- ---------------- ------------------------------- Q1 Q2 Q3 Q4 FULL YEAR -- -- -- -- --------- PRE-TAX CHARGE $ (1) $ (8) $ (3) $ (6) $(18) PRE-TAX SAVINGS -- 1 3 6 10 ------ ------ ---- ---- ------ NET PRE-TAX IMPACT $ (1) $ (7) $ -- $ -- $ (8) ====== ====== ==== ==== ====== DILUTED EARNINGS PER SHARE $(0.01) $(0.07) $ -- $ -- $(0.08) ====== ====== ==== ==== ======
13 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL FY 2004 FREE CASH FLOW OUTLOOK
(IN MILLIONS) FULL YEAR FY 2004 -------------------------- NET INCOME $ 150 - $ 165 ADJUSTMENTS TO INCOME DEPRECIATION AND OTHER AMORTIZATION 200 - 210 PENSION AND RETIREE MEDICAL EXPENSE 130 - 130 PENSION AND RETIREE MEDICAL CONTRIBUTIONS (205) - (210) CHANGES IN ASSETS AND LIABILITIES 50 - 80 ----- ----- CASH PROVIDED BY OPERATIONS 325 - 375 CAPITAL EXPENDITURES (195) - (205) ----- ----- FREE CASH FLOW $ 130 - $ 170 ===== ===== NET PROCEEDS FROM ACQUISITIONS AND DIVESTITURES (1) $ 89 - $ 89 ===== ===== CASH DIVIDENDS ($0.40 PER SHARE) $ (28) - $ (28) ===== =====
(1) INCLUDES SALE OF BUSINESSES, PROPERTY AND MARKETABLE SECURITIES. NOTE: DOES NOT INCLUDE THE EFFECTS OF ANY CHANGES IN A/R SECURITIZATION AND FACTORING OR ANY FUTURE ACQUISITIONS OR DIVESTITURES. 14 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL 3RD QUARTER FY 2004 SALES OUTLOOK
(IN MILLIONS) FY 2004 3RD QUARTER OUTLOOK -------------------------------- SALES FY 2003 THIRD QUARTER $2,109 $2,109 ------ ------ LIGHT VEHICLE SYSTEMS 20 -- 25 COMMERCIAL VEHICLE SYSTEMS 185 -- 190 LIGHT VEHICLE AFTERMARKET -- -- 5 OTHER 1 -- 1 ------ ------ TOTAL CHANGE 206 -- 221 ------ ------ SALES FY 2004 THIRD QUARTER $2,315 -- $2,330 ====== ======
15 (ARVINMERITOR LOGO) FISCAL 2004 2ND QUARTER EARNINGS CONFERENCE CALL 3RD QUARTER FY 2004 OUTLOOK
(IN MILLIONS, EXCEPT EPS) FY 2003 FY 2004 3RD QUARTER 3RD QUARTER OUTLOOK ----------- -------------------------------- SALES $ 2,109 $2,315 -- $2,330 ========= ====== ====== OPERATING MARGIN 4.6% 4.0% -- 4.3% ========= ====== ====== NET INCOME $ 47 $ 48 -- $ 52 ========= ====== ====== DILUTED EARNINGS PER SHARE $ 0.69 $ 0.70 -- $ 0.75 ========= ====== ======
NOTE: OUTLOOK DOES NOT INCLUDE THE IMPACT OF ANY ACQUISTIONS OR DIVESTITURES. 16 (ARVINMERITOR LOGO)