8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported): May 5, 2015

KEMET Corporation

(Exact name of registrant as specified in its charter)

Delaware	001-15491	57-0923789
(State of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2835 KEMET Way, Simpsonville, SC	29681
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (864) 963-6300

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

On May 5, 2015, KEMET Corporation (the “Company”) issued a News Release announcing the preliminary consolidated results for the fourth fiscal quarter and fiscal year ended March 31, 2015.

A copy of this News Release is furnished as Exhibit 99.1 to this Form 8-K.

Item 7.01 Regulation FD Disclosure

On May 5, 2015, the Company will host a conference call to discuss financial results for its fourth fiscal quarter and fiscal year ended March 31, 2015.  The slide package prepared for use by executive management for this presentation is attached hereto as Exhibit 99.2.  All of the information in the presentation is presented as of May 5, 2015, and the Company does not assume any obligation to update such information in the future.

The information included in this Form 8-K, as well as the exhibits referenced herein, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

Item 9.01 Financial Statements and Exhibits

(a.) Not Applicable

(b.) Not Applicable

(c.) Not Applicable

(d.) Exhibits

Exhibit No.	Description of Exhibit
99.1	News Release, dated May 6, 2015 issued by the Company.
99.2	Slide Package prepared for use in connection with the Company’s fourth fiscal quarter and fiscal year earnings conference call to be held on May 5, 2015.

Signature

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: May 5, 2015	KEMET Corporation
	/s/ WILLIAM M. LOWE, JR.
	William M. Lowe, Jr.
	Executive Vice President and
	Chief Financial Officer

EX-99.1

Exhibit 99.1

NewsRelease

FOR IMMEDIATE RELEASE

Contact:	William M. Lowe, Jr.	Richard J. Vatinelle
	Executive Vice President and	Vice President and
	Chief Financial Officer	Treasurer
	williamlowe@kemet.com	richardvatinelle@kemet.com
	864-963-6484	954-766-2800

KEMET REPORTS PRELIMINARY FOURTH QUARTER AND FISCAL YEAR 2015 RESULTS

Greenville, South Carolina (May 5, 2015) - KEMET Corporation (the “Company”) (NYSE: KEM), a leading global supplier of electronic components, today reported preliminary results for the fourth quarter and fiscal year ended March 31, 2015.

Net sales of $193.7 million for the quarter ended March 31, 2015decreased3.8% from net sales of $201.3 million for the prior quarter ended December 31, 2014, and decreased10.2% compared to net sales of $215.8 million for the quarter ended March 31, 2014. For the fiscal year ended March 31, 2015 net sales were $823.2 million compared to $833.7 million for the fiscal year ended March 31, 2014.

The U.S. GAAP net loss for the quarter ended March 31, 2015 was $19.8 million, or $0.44 loss per basic and diluted share, compared to a net loss for the quarter ended March 31, 2014 of $14.4 million or $0.32 loss per basic and diluted share. For the fiscal year ended March 31, 2015, the net loss was $14.1 million, or $0.31 loss per diluted share compared to a net loss of $68.5 million, or $1.52 loss per diluted share for the fiscal year ended March 31, 2014.

The non-U.S. GAAP Adjusted net loss for the quarter ended March 31, 2015 was $1.6 million or $0.04 loss per basic and diluted share, compared to a non-U.S. GAAP Adjusted net income of $1.7 million or $0.03 per diluted share for the quarter ended March 31, 2014. For the fiscal year ended March 31, 2015, the non-U.S. GAAP net income was $7.0 million, or $0.13 per diluted share compared to a net loss of $17.5 million, or $0.39 loss per basic and diluted share for the fiscal year ended March 31, 2014.

“We entered this fiscal year focused on improving Adjusted operating income and cash flow and we are pleased that our Adjusted operating income improved over $30.5 million compared to our prior fiscal year even with some currency headwinds in the last two quarters,” stated Per Loof, KEMET’s Chief Executive Officer. “As we adjust to the reality of a strong U.S. dollar we believe we have positioned our cost structure to allow us to continue a trend of improving our Adjusted operating income for our next fiscal year as well,” continued Loof.

The net income (loss) for the quarters ended March 31, 2015 and 2014 include various items affecting comparability as denoted in the U.S. GAAP to Non-U.S. GAAP reconciliation table included hereafter.

About KEMET

The Company’s common stock is listed on the NYSE under the ticker symbol “KEM” (NYSE: KEM).  At the Investor Relations section of our web site at http://www.kemet.com/IR, users may subscribe to KEMET news releases and find additional information about our Company.  KEMET applies world class service and quality to deliver industry leading, high performance capacitance solutions to its customers around the world and offers the world’s most complete line of surface mount and through-hole capacitor technologies across tantalum, ceramic, film, aluminum, electrolytic, and paper dielectrics. Additional information about KEMET can be found at http://www.kemet.com.

QUIET PERIOD

Beginning July 1, 2015, we will observe a quiet period during which the information provided in this news release and annual report on Form 10-K will no longer constitute our current expectations. During the quiet period, this information should be considered to be historical, applying prior to the quiet period only and not subject to update by management. The quiet period will extend until the day when our next quarterly earnings release is published.

CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

Certain statements included herein contain forward-looking statements within the meaning of federal securities laws about the Company’s financial condition and results of operations that are based on management’s current expectations, estimates and projections about the markets, in which the Company operates, as well as management’s beliefs and assumptions. Words such as “expects,” “anticipates,” “believes,” “estimates,” variations of such words and other similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in, or implied by, such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s judgment only as of the date hereof. The Company undertakes no obligation to update publicly any of these forward-looking statements to reflect new information, future events or otherwise.

Factors that may cause the actual outcomes and results to differ materially from those expressed in, or implied by, these forward-looking statements include, but are not necessarily limited to the following: (i) adverse economic conditions could impact our ability to realize operating plans if the demand for our products declines, and such conditions could adversely affect our liquidity and ability to continue to operate; (ii) continued net losses could impact our ability to realize current operating plans and could materially adversely affect our liquidity and our ability to continue to operate; (iii) adverse economic conditions could cause the write down of long-lived assets or goodwill; (iv) an increase in the cost or a decrease in the availability of our principal or single-sourced purchased materials; (v) changes in the competitive environment; (vi) uncertainty of the timing of customer product qualifications in heavily regulated industries; (vii) economic, political, or regulatory changes in the countries in which we operate; (viii) difficulties, delays or unexpected costs in completing the restructuring plans; (ix) equity method investment in NEC TOKIN exposes us to a variety of risks; (x) possible acquisition of NEC TOKIN may not achieve all of the anticipated results; (xi) acquisitions and other strategic transactions expose us to a variety of risks; (xii) our business could be negatively impacted by increased regulatory scrutiny and litigation (xiii) inability to attract, train and retain effective employees and management; (xiv) inability to develop innovative products to maintain customer relationships and offset potential price erosion in older products; (xv) exposure to claims alleging product defects; (xvi) the impact of laws and regulations that apply to our business, including those relating to environmental matters; (xvii) the impact of international laws relating to trade, export controls and foreign corrupt practices; (xviii) volatility of financial and credit markets affecting our access to capital; (xix) the need to reduce the total costs of our products to remain competitive; (xx) potential limitation on the use of net operating losses to offset possible future taxable income; (xxi) restrictions in our debt agreements that limit our flexibility in operating our business; (xxii) failure of our information technology systems to function properly or our failure to control unauthorized access to our systems may cause business disruptions; and (xxiii) additional exercise of the warrant by K Equity which could potentially result in the existence of a significant stockholder who could seek to influence our corporate decisions.

2

KEMET CORPORATION AND SUBSIDIARIES

Consolidated Statements of Operations

(Amounts in thousands, except per share data)

(Unaudited)

	Quarters Ended March 31,						Fiscal Year Ended
	2015			2014			2015			2014
Net sales	$	193,708		$	215,821		$	823,192		$	833,666
Operating costs and expenses:
Cost of sales	157,379			182,203			663,683			712,925
Selling, general and administrative expenses	24,870			25,030			98,533			95,856
Research and development	6,572			6,762			25,802			24,466
Restructuring charges	3,437			5,954			13,017			14,122
Write down of long-lived assets	—			1,118			—			4,476
Net (gain) loss on sales and disposals of assets	538			(39		)	(221		)	32
Total operating costs and expenses	192,796			221,028			800,814			851,877
Operating income (loss)	912			(5,207		)	22,378			(18,211		)
Other (income) expense:
Interest income	(4		)	(13		)	(15		)	(195		)
Interest expense	10,020			10,671			40,701			40,962
Other income (expense), net	8,647			(2,632		)	(6,182		)	(2,681		)
Income (loss) from continuing operations before income taxes and equity loss from NEC TOKIN	(17,751		)	(13,233		)	(12,126		)	(56,297		)
Income tax expense (benefit)	3			(2,811		)	5,227			1,482
Income (loss) from continuing operations before equity loss from NEC TOKIN	(17,754		)	(10,422		)	(17,353		)	(57,779		)
Equity income (loss) from NEC TOKIN	(2,093		)	(4,128		)	(2,169		)	(7,090		)
Income (loss) from continuing operations	(19,847		)	(14,550		)	(19,522		)	(64,869		)
Income (loss) from discontinued operations	—			103			5,379			(3,634		)
Net income (loss)	$	(19,847	)	$	(14,447	)	$	(14,143	)	$	(68,503	)
Net loss per basic and diluted share:
Income (loss) from continuing operations	$	(0.44	)	$	(0.32	)	$	(0.43	)	$	(1.44	)
Income (loss) from discontinued operations	$	—		$	—		$	0.12		$	(0.08	)
Net income (loss)	$	(0.44	)	$	(0.32	)	$	(0.31	)	$	(1.52	)
Weighted-average shares outstanding:
Basic and diluted	45,443			45,174			45,381			45,102

3

KEMET CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(Amounts in thousands, except per share data)

(Unaudited)

	March 31, 2015			March 31, 2014
ASSETS
Current assets:
Cash and cash equivalents	$	56,362		$	57,929
Accounts receivable, net	90,857			98,947
Inventories, net	171,843			187,974
Prepaid expenses and other	41,650			36,871
Deferred income taxes	11,012			6,695
Current assets of discontinued operations	—			12,160
Total current assets	371,724			400,576
Property and equipment	249,641			292,648
Goodwill	35,584			35,584
Intangible assets, net	33,282			37,184
Investment in NEC TOKIN	45,016			46,419
Restricted cash	1,775			13,512
Deferred income taxes	8,053			6,778
Other assets	11,056			10,130
Noncurrent assets of discontinued operations	—			836
Total assets	$	756,131		$	843,667
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	462		$	7,297
Accounts payable	69,785			74,818
Accrued expenses	60,456			76,468
Income taxes payable and deferred income taxes	337			980
Current liabilities of discontinued operations	—			7,269
Total current liabilities	131,040			166,832
Long-term debt, less current portion	390,909			391,292
Other non-current obligations	57,131			55,864
Deferred income taxes	9,427			5,203
Noncurrent liabilities of discontinued operations	—			2,592
Commitments and contingencies
Stockholders’ equity:
Preferred stock, par value $0.01, authorized 10,000 shares, none issued	—			—
Common stock, par value $0.01, authorized 175,000 shares, issued 46,508 shares at March 31, 2015 and 2014	465			465
Additional paid-in capital	461,192			465,027
Retained deficit	(245,881		)	(231,738		)
Accumulated other comprehensive income	(25,855		)	18,184
Treasury stock, at cost (1,057 and 1,301 shares at March 31, 2015 and 2014, respectively)	(22,297		)	(30,054		)
Total stockholders’ equity	167,624			221,884
Total liabilities and stockholders’ equity	$	756,131		$	843,667

4

KEMET CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(Amounts in thousands)

(Unaudited)

	Fiscal Years Ended March 31,
	2015			2014
Net income (loss)	$	(14,143	)	$	(68,503	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Gain on sale of discontinued operations	(5,644		)	—
Net cash provided by (used in) operating activities of discontinued operations	(679		)	336
Depreciation and amortization	40,768			49,527
Amortization of debt discount and debt issuance costs	2,032			3,596
Gain on early extinguishment of debt	(1,003		)	—
Equity loss from NEC TOKIN	2,169			7,090
Change in value of NEC TOKIN options	(2,100		)	(3,111		)
Net (gain) loss on sales and disposals of assets	(221		)	32
Stock-based compensation expense	4,512			2,909
Pension and other post-retirement benefits	(13,283		)	(78		)
Deferred income tax expense (benefit)	(1,257		)	(6,369		)
Write down of long-lived assets	—			4,476
Write down of receivables	52			1,484
Other, net	(7		)	(521		)
Changes in assets and liabilities:
Accounts receivable	8,220			(4,618		)
Inventories	8,559			14,891
Prepaid expenses and other current assets	(8,550		)	3,748
Accounts payable	(2,879		)	(2,070		)
Accrued income taxes	4,155			172
Other operating liabilities	3,701			(9,737		)
Net cash provided by (used in) operating activities	24,402			(6,746		)
Investing activities:
Capital expenditures	(22,232		)	(32,147		)
Change in restricted cash	11,509			4,047
Proceeds from sale of discontinued operations	9,564			—
Proceeds from sale of assets	4,788			2,847
Net cash provided by (used in) investing activities	3,629			(25,253		)
Financing activities:
Proceeds from revolving line of credit	42,340			21,000
Payment of revolving line of credit	(27,342		)	(2,551		)
Deferred acquisition payments	(19,527		)	(21,977		)
Payments of long-term debt	(21,733		)	(3,599		)
Proceeds from exercise of stock options	24			250
Purchase of treasury stock	(630		)	—
Net cash provided by (used in) financing activities	(26,868		)	(6,877		)
Net increase (decrease) in cash and cash equivalents	1,163			(38,876		)
Effect of foreign currency fluctuations on cash	(2,730		)	827
Cash and cash equivalents at beginning of fiscal period	57,929			95,978
Cash and cash equivalents at end of fiscal period	$	56,362		$	57,929

5

Non-U.S. GAAP Financial Measures

In this news release, the Company makes reference to certain Non-U.S. GAAP financial measures, including "Adjusted gross margin", "Adjusted operating income", “Adjusted net income (loss)”, “Adjusted net income (loss) per share” and “Adjusted EBITDA”.  Management believes that investors may find it useful to review the Company’s financial results as adjusted to exclude items as determined by management.

Adjusted Gross Margin

Adjusted gross margin represents net sales less cost of sales excluding adjustments which are outlined in the quantitative reconciliation provided below.  Management uses Adjusted gross margin to facilitate our analysis and understanding of our business operations and believes that Adjusted gross margin is useful to investors because it provides a supplemental way to understand the underlying operating performance of the Company.  Adjusted gross margin should not be considered as an alternative to gross margin or any other performance measure derived in accordance with U.S. GAAP.

The following table provides a reconciliation from U.S. GAAP Gross margin to Non-U.S. GAAP Adjusted gross margin (amounts in thousands):

	Quarters Ended									Fiscal Years Ended
	March 31, 2015			December 31, 2014			March 31, 2014			March 31, 2015			March 31, 2014
				(Unaudited)
Net sales	$	193,708		$	201,310		$	215,821		$	823,192		$	833,666
Gross Margin	36,329			44,468			33,618			159,509			120,741
Non-U.S. GAAP-adjustments:
Inventory Revaluation	(927		)	(927		)	—			—			—
Plant shut-down costs	—			—			2,668			889			2,668
Plant start-up costs	651			1,144			669			4,556			3,336
Stock-based compensation expense	465			424			186			1,577			1,008
Inventory write downs	—			—			—			—			3,886
Infrastructure tax	—			—			1,079			—			1,079
Adjusted gross margin	$	36,518		$	45,109		$	38,220		$	166,531		$	132,718
	18.9		%	22.4		%	17.7		%	20.2		%	15.9		%

6

Adjusted Operating Income

Adjusted operating income represents operating income (loss), excluding adjustments which are outlined in the quantitative reconciliation provided below. We use Adjusted operating income to facilitate our analysis and understanding of our business operations and believe that Adjusted operating income is useful to investors because it provides a supplemental way to understand our underlying operating performance. Adjusted operating income should not be considered as an alternative to operating income or any other performance measure derived in accordance with U.S. GAAP.

Adjusted operating income is calculated as follows (amounts in thousands):

	Quarters Ended									Fiscal Year Ended
	March 31, 2015			December 31, 2014 (1)			March 31, 2014			March 31, 2015		March 31, 2014
	(Unaudited)
Operating income (loss)	$	912		$	9,302		$	(5,207	)	22,378		(18,211	)
Adjustments:
Restructuring charges	3,437			6,063			5,954			13,017		14,122
Plant shut-down costs	—			—			2,668			889		2,668
Write down of long-lived assets	—			—			1,118			—		4,476
ERP integration costs	1,273			671			837			3,248		3,880
Plant start-up costs	651			1,144			669			4,556		3,336
NEC TOKIN investment related expenses	226			485			618			1,778		2,299
Stock-based compensation expense	1,328			1,232			579			4,512		2,909
Inventory Revaluation	(927		)	(927		)	—			—		—
Inventory write downs	—			—			—			—		3,886
Infrastructure tax	—			—			1,079			—		1,079
Net (gain) loss on sales and disposals of assets	538			(574		)	(39		)	(221	)	32
Legal expenses related to antitrust class actions	435			409			—			844		—
Adjusted operating income (loss)	$	7,873		$	17,805		$	8,276		51,001		20,476

(1) We have revised the quarter ended December 31, 2014 Non-GAAP presentation to conform with the quarter ended March 31, 2015.

Adjusted Net Income (Loss) and Adjusted Net Income (Loss) Per Share

“Adjusted net income (loss)” and “Adjusted net income (loss) per share” represent net income (loss) and net income (loss) per share excluding adjustments which are outlined in the quantitative reconciliation provided below.  Management believes that these Non-U.S. GAAP financial measures are useful to investors because they provide a supplemental way to understand the underlying operating performance of the Company.  Management uses these Non-U.S. GAAP financial measures to evaluate operating performance.  Non-U.S. GAAP financial measures should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with U.S. GAAP.

7

The following table provides reconciliation from U.S. GAAP net income (loss) to Non-U.S. GAAP adjusted net income (loss):

U.S.GAAP to Non-U.S.GAAP Reconciliation

	Quarters Ended									Fiscal Year Ended
	March 31, 2015			December 31, 2014 (1)			March 31, 2014			March 31, 2015			March 31, 2014
	(Unaudited, Amounts in thousands, except per share data)
U.S. GAAP
Net sales	$	193,708		$	201,310		$	215,821		$	823,192		$	833,666
Net income (loss)	$	(19,847	)	$	2,914		$	(14,447	)	$	(14,143	)	$	(68,503	)
Net income (loss) - basic eps	$	(0.44	)	$	0.06		$	(0.32	)	$	(0.31	)	$	(1.52	)
Net income (loss) - diluted eps	$	(0.44	)	$	0.06		$	(0.32	)	$	(0.31	)	$	(1.52	)
Non-U.S. GAAP
Net income (loss)	(19,847		)	2,914			(14,447		)	(14,143		)	(68,503		)
Adjustments:
Restructuring charges	3,437			6,063			5,954			13,017			14,122
Equity (gain) loss from NEC TOKIN	2,093			(1,367		)	4,127			2,169			7,090
Write down of long-lived assets	—			—			1,118			—			4,476
Inventory write downs	—			—			—			—			3,886
ERP integration costs	1,273			671			837			3,248			3,880
Amortization included in interest expense	244			322			780			1,814			3,596
Plant start-up costs	651			1,144			669			4,556			3,336
Stock-based compensation	1,328			1,232			579			4,512			2,909
Plant shut-down costs	—			—			2,668			889			2,668
NEC TOKIN investment related expenses	226			485			618			1,778			2,299
(Gain) loss on early extinguishment of debt	—			(1,003		)	—			(1,003		)	—
Professional fees related to financing activities	—			1,142			—			1,142			—
Long-term receivable write down	—			—			—			—			1,444
(Gain) loss on sales and disposals of assets	538			(574		)	(39		)	(221		)	32
(Income) loss from discontinued operations	—			164			(103		)	(5,379		)	3,634
Inventory Revaluation	(927		)	(927		)	—			—			—
Income tax effect of non-GAAP adjustments (2)	20			37			100			84			(27		)
Net foreign exchange (gain) loss	(2,168		)	(1,257		)	(449		)	(4,249		)	(304		)
Infrastructure tax	—			—			1,079			—			1,079
Change in value of NEC TOKIN options	11,100			(2,500		)	(1,777		)	(2,100		)	(3,111		)
Legal expenses related to antitrust class actions	435			409			—			844			—
Adjusted net income (loss)	$	(1,597	)	$	6,955		$	1,714		$	6,958		$	(17,494	)
Adjusted net income (loss) per basic share	$	(0.04	)	$	0.15		$	0.04		$	0.15		$	(0.39	)
Adjusted net income (loss) per diluted share	$	(0.04	)	$	0.13		$	0.03		$	0.13		$	(0.39	)
Weighted average shares outstanding:
Basic	45,443			45,407			45,174			45,381			45,102
Diluted	45,443			52,228			52,523			52,588			45,102

 (1) We have revised the quarter ended December 31, 2014 Non-GAAP presentation to conform with the quarter ended March 31, 2015.

(2) The income tax effect of the excluded items is calculated by applying the applicable jurisdictional income tax rate, considering the deferred tax valuation for each applicable jurisdiction.

8

Adjusted EBITDA

Adjusted EBITDA represents net income (loss) before net interest expense, income tax expense, and depreciation and amortization expense, adjusted to exclude certain item which are outlined in the quantitative reconciliation provided below.  We use Adjusted EBITDA to monitor and evaluate our operating performance and to facilitate internal and external comparisons of the historical operating performance of our business.  We present Adjusted EBITDA as a supplemental measure of our performance and ability to service debt.  We also present Adjusted EBITDA because we believe such measure is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.

We believe Adjusted EBITDA is an appropriate supplemental measure of debt service capacity, because cash expenditures on interest are, by definition, available to pay interest, and tax expense is inversely correlated to interest expense because tax expense goes down as deductible interest expense goes up; depreciation and amortization are non-cash charges. The other adjustments to arrive at Adjusted EBITDA are excluded in order to better reflect our continuing operations.

In evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses similar to the adjustments noted below.  Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these types of adjustments.  Adjusted EBITDA is not a measurement of our financial performance under U.S. GAAP and should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with U.S. GAAP or as an alternative to cash flow from operating activities as a measure of our liquidity.

Our Adjusted EBITDA measure has limitations as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our results as reported under U.S. GAAP.  Some of these limitations are:

• it does not reflect our cash expenditures, future requirements for capital expenditures or contractual commitments;

• it does not reflect changes in, or cash requirements for, our working capital needs;

• it does not reflect the significant interest expense or the cash requirements necessary to service interest or principal payment on our debt;

• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and our Adjusted EBITDA measure does not reflect any cash requirements for such replacements;

• it is not adjusted for all non-cash income or expense items that are reflected in our statements of cash flows;

• it does not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations;

• it does not reflect limitations on or costs related to transferring earnings from our subsidiaries to us; and

• other companies in our industry may calculate this measure differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business or as a measure of cash that will be available to us to meet our obligations.  You should compensate for these limitations by relying primarily on our U.S. GAAP results and using Adjusted EBITDA only supplementally.

9

The following table provides a reconciliation from U.S. GAAP net income (loss) to Adjusted EBITDA (amounts in thousands):

	Fiscal Year 2015
	Q1			Q2			Q3 (1)			Q4			Total
Net income (loss)	$	(3,540	)	$	6,330		$	2,914		$	(19,847	)	$	(14,143	)
Adjustments:
Income tax expense	1,282			2,583			1,359			3			5,227
Interest expense, net	10,453			10,284			9,933			10,017			40,687
Depreciation and amortization	10,797			10,177			9,720			10,074			40,768
Restructuring charges	1,830			1,687			6,063			3,437			13,017
(Income) loss from discontinued operations	(6,943		)	1,400			164			—			(5,379		)
ERP integration costs	895			409			671			1,273			3,248
Plant start-up costs	1,647			1,114			1,144			651			4,556
Plant shut-down costs	889			—			—			—			889
NEC TOKIN investment related expenses	580			487			485			226			1,778
Stock-based compensation	994			958			1,232			1,328			4,512
(Gain) loss on sales and disposals of assets	365			(550		)	(574		)	538			(221		)
Change in value of NEC TOKIN options	(4,100		)	(6,600		)	(2,500		)	11,100			(2,100		)
Inventory revaluation	2,676			(822		)	(927		)	(927		)	—
Equity (gain) loss from NEC TOKIN	1,675			(232		)	(1,367		)	2,093			2,169
Net foreign exchange (gain) loss	527			(1,351		)	(1,257		)	(2,168		)	(4,249		)
(Gain) loss on early extinguishment of debt	—			—			(1,003		)	—			(1,003		)
Professional fees related to financing activities	—			—			1,142			—			1,142
Legal expenses related to antitrust class actions	—			—			409			435			844
Adjusted EBITDA	$	20,027		$	25,874		$	27,608		$	18,233		$	91,742
(1) We have revised the quarter ended December 31, 2014 Non-GAAP presentation to conform with the quarter ended March 31, 2015.
	Fiscal Year 2014
	Q1			Q2			Q3			Q4			Total
Net income (loss)	$	(35,140	)	$	(13,096	)	$	(5,820	)	$	(14,447	)	$	(68,503	)
Adjustments:
Income tax expense	1,816			1,444			1,033			(2,811		)	1,482
Interest expense, net	9,870			9,897			10,342			10,658			40,767
Depreciation and amortization	13,639			11,951			11,762			12,175			49,527
(Income) loss from discontinued operations	1,510			1,151			1,076			(103		)	3,634
Restructuring charges	4,610			1,364			2,194			5,954			14,122
Write down of long-lived assets	—			—			3,358			1,118			4,476
ERP integration costs	978			1,071			994			837			3,880
Plant start-up costs	1,132			1,050			485			669			3,336
Plant shut-down costs	—			—			—			2,668			2,668
NEC TOKIN investment related expenses	1,308			124			249			618			2,299
Stock-based compensation	969			659			702			579			2,909
(Gain) loss on sales and disposals of assets	—			42			29			(39		)	32
Change in value of NEC TOKIN options	—			382			(1,716		)	(1,777		)	(3,111		)
Inventory write downs	3,886			—			—			—			3,886
Long-term receivable write down	1,444			—			—			—			1,444
Equity (gain) loss from NEC TOKIN	3,377			1,243			(1,657		)	4,127			7,090
Net foreign exchange (gain) loss	(577		)	515			207			(449		)	(304		)
Infrastructure Tax	—			—			—			1,079			1,079
Adjusted EBITDA	$	8,822		$	17,797		$	23,238		$	20,856		$	70,713

10

EX-99.2

Earnings Conference Call May 5, 2015 Quarter Ended March 31, 2015

Cautionary Statement Certain statements included herein contain forward-looking statements within the meaning of federal securities laws about KEMET Corporation's (the "Company") financial condition and results of operations that are based on management's current expectations, estimates and projections about the markets in which the Company operates, as well as management's beliefs and assumptions. Words such as "expects," "anticipates," "believes," "estimates," variations of such words and other similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in, or implied by, such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's judgment only as of the date hereof. The Company undertakes no obligation to update publicly any of these forward-looking statements to reflect new information, future events or otherwise. Factors that may cause the actual outcomes and results to differ materially from those expressed in, or implied by, these forward- looking statements include, but are not necessarily limited to the following: (i) adverse economic conditions could impact our ability to realize operating plans if the demand for our products declines, and such conditions could adversely affect our liquidity and ability to continue to operate; (ii) continued net losses could impact our ability to realize current operating plans and could materially adversely affect our liquidity and our ability to continue to operate; (iii) adverse economic conditions could cause the write down of long-lived assets or goodwill; (iv) an increase in the cost or a decrease in the availability of our principal or single- sourced purchased materials; (v) changes in the competitive environment; (vi) uncertainty of the timing of customer product qualifications in heavily regulated industries; (vii) economic, political, or regulatory changes in the countries in which we operate; (viii) difficulties, delays or unexpected costs in completing the restructuring plans; (ix) equity method investment in NEC TOKIN exposes us to a variety of risks; (x) possible acquisition of NEC TOKIN may not achieve all of the anticipated results; (xi) acquisitions and other strategic transactions expose us to a variety of risks; (xii) our business could be negatively impacted by increased regulatory scrutiny and litigation (xiii) inability to attract, train and retain effective employees and management; (xiv) inability to develop innovative products to maintain customer relationships and offset potential price erosion in older products; (xv) exposure to claims alleging product defects; (xvi) the impact of laws and regulations that apply to our business, including those relating to environmental matters; (xvii) the impact of international laws relating to trade, export controls and foreign corrupt practices; (xviii) volatility of financial and credit markets affecting our access to capital; (xix) the need to reduce the total costs of our products to remain competitive; (xx) potential limitation on the use of net operating losses to offset possible future taxable income; (xxi) restrictions in our debt agreements that limit our flexibility in operating our business; (xxii) failure of our information technology systems to function properly or our failure to control unauthorized access to our systems may cause business disruptions; and (xxiii) additional exercise of the warrant by K Equity which could potentially result in the existence of a significant stockholder who could seek to influence our corporate decisions. 2

Income Statement Highlights U.S. GAAP (Unaudited) 3 For the Quarters Ended (Amounts in thousands, except percentages and per share data) Mar 2015 Dec 2014 Mar 2014 Net sales $ 193,708 $ 201,310 $ 215,821 Gross margin $ 36,329 $ 44,468 $ 33,618 Gross margin as a percentage of net sales 18.8 % 22.1 % 15.6 % Selling, general and administrative $ 24,870 $ 23,374 $ 25,030 SG&A as a percentage of net sales 12.8 % 11.6 % 11.6 % Operating income (loss) $ 912 $ 9,302 $ (5,207 ) Net income (loss) from continuing operations $ (19,847 ) $ 3,078 $ (14,550 ) Income (loss) from discontinued operations — (164 ) 103 Net income (loss) $ (19,847 ) $ 2,914 $ (14,447 ) Per share data: Net income (loss) from continuing operations - basic $ (0.44 ) $ 0.07 $ (0.32 ) Income (loss) from discontinued operations - basic $ — $ — $ — Net income (loss) - basic $ (0.44 ) $ 0.07 $ (0.32 ) Net income (loss) from continuing operations - diluted $ (0.44 ) $ 0.06 $ (0.32 ) Income (loss) from discontinued operations - diluted $ — $ — $ — Net income (loss) - diluted $ (0.44 ) $ 0.06 $ (0.32 ) Weighted avg. shares - basic 45,443 45,407 45,174 Weighted avg. shares - diluted 45,443 52,228 45,174

Income Statement Highlights Non-GAAP 4 For the Quarters Ended (Amounts in thousands, except percentages and per share data) Mar 2015 Dec 2014 (1) Mar 2014 Net sales $ 193,708 $ 201,310 $ 215,821 Adjusted gross margin $ 36,518 $ 45,109 $ 38,220 Gross margin as a percentage of net sales 18.9 % 22.4 % 17.7 % Adjusted selling, general and administrative $ 22,099 $ 21,101 $ 23,236 SG&A as a percentage of net sales 11.4 % 10.5 % 10.8 % Adjusted operating income (loss) $ 7,873 $ 17,805 $ 8,276 Adjusted net income (loss) from continuing operations $ (1,597 ) $ 6,955 $ 1,714 Adjusted net income (loss) from discontinued operations — — — Adjusted net income (loss) $ (1,597 ) $ 6,955 $ 1,714 Adjusted EBITDA 18,233 27,608 20,856 Per share data: Adjusted net income (loss) from continuing operations - basic $ (0.04 ) $ 0.15 $ 0.04 Adjusted net income (loss) from discontinued operations - basic — — — Adjusted net income (loss) - basic (0.04 ) 0.15 0.04 Adjusted net income (loss) from continuing operations - diluted (0.04 ) 0.13 0.03 Adjusted net income (loss) from discontinued operations - diluted — — — Adjusted net income (loss) - diluted $ (0.04 ) $ 0.13 $ 0.03 Weighted avg. shares - basic 45,443 45,407 45,174 Weighted avg. shares - diluted 45,443 52,228 52,523 (1) We have revised the quarter ended December 31, 2014 Non-GAAP presentation to conform with the quarter ended March 31, 2015.

Income Statement Highlights (Unaudited) 5 U.S. GAAP Non-GAAP (Amounts in thousands, except percentages and per share data) FY 2015 FY 2014 FY 2015 FY 2014 Net sales $ 823,192 $ 833,666 $ 823,192 $ 833,666 Gross margin $ 159,509 $ 120,741 $ 166,531 $ 132,718 Gross margin as a percentage of net sales 19.4 % 14.5 % 20.2 % 15.9 % Selling, general and administrative $ 98,533 $ 95,856 $ 90,023 $ 87,973 SG&A as a percentage of net sales 12.0 % 11.5 % 10.9 % 10.6 % Operating income (loss) $ 22,378 $ (18,211 ) $ 51,001 $ 20,476 Net income (loss) from continuing operations $ (19,522 ) $ (64,869 ) $ 6,958 $ (17,494 ) Income (loss) from discontinued operations 5,379 (3,634 ) — — Net income (loss) $ (14,143 ) $ (68,503 ) $ 6,958 $ (17,494 ) Adjusted EBITDA $ 91,742 $ 70,713 Per share data: Adjusted net income (loss) from continuing operations - basic $ (0.43 ) $ (1.44 ) $ 0.15 $ (0.39 ) Adjusted net income (loss) from discontinued operations - basic 0.12 (0.08 ) — — Adjusted net income (loss) - basic (0.31 ) (1.52 ) 0.15 (0.39 ) Adjusted net income (loss) from continuing operations - diluted (0.43 ) (1.44 ) 0.13 (0.39 ) Adjusted net income (loss) from discontinued operations - diluted 0.12 (0.08 ) — — Adjusted net income (loss) - diluted $ (0.31 ) $ (1.52 ) $ 0.13 $ (0.39 ) Weighted avg. shares - basic 45,381 45,102 45,381 45,102 Weighted avg. shares - diluted 45,381 45,102 52,588 45,102

Adjusted Operating Income (Loss) Non-GAAP Solid Capacitors 6 For the Quarters Ended (Amounts in thousands) Mar 2015 Dec 2014 Net sales $ 145,680 $ 152,785 Operating income (loss) 29,726 38,103 Adjustments: Restructuring charges 1,402 496 Inventory revaluation (238 ) (238 ) Stock-based compensation expense 292 221 Plant start-up costs 315 463 NEC TOKIN investment related expenses (7 ) 6 Gain on sales and disposals of assets 504 (7 ) Adjusted operating income (loss) $ 31,994 $ 39,044

Adjusted Operating Income (Loss) Non-GAAP Film & Electrolytics 7 For the Quarters Ended (Amounts in thousands) Mar 2015 Dec 2014 Net sales $ 48,026 $ 48,525 Operating income (loss) (4,558 ) (5,137 ) Adjustments: Restructuring charges 1,737 4,496 Inventory revaluation (689 ) (689 ) Gain (loss) on sales and disposals of assets (144 ) (567 ) Plant start-up costs 336 681 Stock-based compensation expense 173 204 Adjusted operating income (loss) $ (3,145 ) $ (1,012 )

Financial Highlights (1) Calculated as accounts receivable, net, plus inventories, net, less accounts payable (2) Calculated by annualizing the current quarter’s Net sales divided by current quarter's accounts receivable (3) Calculated by annualizing the current quarter’s Cost of sales by current quarter's accounts payable 8 (Amounts in millions, except DSO and DPO) Mar 2015 Dec 2014 FX Impact Cash, cash equivalents $ 56.4 $ 55.6 $ (1.1 ) Capital expenditures $ 4.8 $ 5.5 Short-term debt $ 0.5 $ 12.5 Long-term debt 388.4 389.4 Debt premium 2.5 2.6 Total debt $ 391.4 $ 404.5 $ — Equity $ 167.6 $ 215.9 $ 12.3 Net working capital (1) $ 192.9 $ 218.0 $ (3.2 ) Days in receivables (DSO)(2) 43 42 Days in payables (DPO)(3) 41 36

Sales Summary - Q4 FY2015 9

Sales Summary - FY 2015 10

Appendix

Adjusted Gross Margin Non-GAAP 12 For the Quarters Ended Fiscal Year (Amounts in thousands, except percentages) Mar 2015 Dec 2014 Mar 2014 2015 2014 Net sales $ 193,708 $ 201,310 $ 215,821 $ 823,192 $ 833,666 Gross margin $ 36,329 $ 44,468 $ 33,618 $ 159,509 $ 120,741 Adjustments: Inventory Revaluation (927 ) (927 ) — — — Plant shut-down costs — — 2,668 889 2,668 Plant start-up costs 651 1,144 669 4,556 3,336 Stock-based compensation expense 465 424 186 1,577 1,008 Inventory write down — — — — 3,886 Infrastructure tax — — 1,079 — 1,079 Adjusted gross margin $ 36,518 $ 45,109 $ 38,220 $ 166,531 $ 132,718 Adjusted gross margin as a percentage of net sales 18.9 % 22.4 % 17.7 % 20.2 % 15.9 %

Adjusted Selling, General & Administrative Expenses Non-GAAP 13 For the Quarters Ended Fiscal Year (Amounts in thousands, except percentages) Mar 2015 Dec 2014 (1) Mar 2014 2015 2014 Net sales $ 193,708 $ 201,310 $ 215,821 $ 823,192 $ 833,666 Selling, general and administrative expenses $ 24,870 $ 23,374 $ 25,030 $ 98,533 $ 95,856 Less adjustments: ERP integration costs 1,273 671 837 3,248 3,880 NEC TOKIN investment related expenses 226 485 618 1,778 2,299 Stock-based compensation expense 837 708 339 2,640 1,704 Legal expenses related to antitrust class actions 435 409 — 844 — Adjusted selling, general and administrative expenses $ 22,099 $ 21,101 $ 23,236 $ 90,023 $ 87,973 Adjusted selling, general, and administrative as a percentage of net sales 11.4 % 10.5 % 10.8 % 10.9 % 10.6 % (1) We have revised the quarter ended December 31, 2014 Non-GAAP presentation to conform with the quarter ended March 31, 2015.

Adjusted Operating Income Non-GAAP 14 For the Quarters Ended Fiscal Year (Amounts in thousands) Mar 2015 Dec 2014 (1) Mar 2014 2015 2014 Operating income (loss) $ 912 $ 9,302 $ (5,207 ) $ 22,378 $ (18,211 ) Adjustments: Restructuring charges 3,437 6,063 5,954 13,017 14,122 Plant shut-down costs — — 2,668 889 2,668 Write down of long-lived assets — — 1,118 — 4,476 ERP integration costs 1,273 671 837 3,248 3,880 Plant start-up costs 651 1,144 669 4,556 3,336 NEC TOKIN investment related expenses 226 485 618 1,778 2,299 Stock-based compensation expense 1,328 1,232 579 4,512 2,909 Inventory Revaluation (927 ) (927 ) — — — Inventory write downs — — — — 3,886 Infrastructure tax — — 1,079 — 1,079 Net (gain) loss on sales and disposals of assets 538 (574 ) (39 ) (221 ) 32 Legal expenses related to antitrust class actions 435 409 — 844 — Adjusted operating income (loss) $ 7,873 $ 17,805 $ 8,276 $ 51,001 $ 20,476 (1) We have revised the quarter ended December 31, 2014 Non-GAAP presentation to conform with the quarter ended March 31, 2015.

Adjusted Net Income (Loss) and Adjusted EBITDA Non-GAAP 15 For the Quarters Ended Fiscal Year (Amounts in thousands) Mar 2015 Dec 2014 (1) Mar 2014 2015 2014 Net income (loss) $ (19,847 ) $ 2,914 $ (14,447 ) $ (14,143 ) $ (68,503 ) Adjustments: Restructuring charges 3,437 6,063 5,954 13,017 14,122 Plant shut-down costs — — 2,668 889 2,668 Write down of long-lived assets — — 1,118 — 4,476 ERP integration costs 1,273 671 837 3,248 3,880 Plant start-up costs 651 1,144 669 4,556 3,336 NEC TOKIN investment related expenses 226 485 618 1,778 2,299 Stock-based compensation 1,328 1,232 579 4,512 2,909 Inventory Revaluation (927 ) (927 ) — — — Inventory write downs — — — — 3,886 (Gain) loss on sales and disposals of assets 538 (574 ) (39 ) (221 ) 32 Long-term receivable write down — — — — 1,444 Equity (gain) loss from NEC TOKIN 2,093 (1,367 ) 4,127 2,169 7,090 Income tax effect of non-GAAP adjustments 20 37 100 84 (27 ) Infrastructure tax — — 1,079 — 1,079 Amortization included in interest expense 244 322 780 1,814 3,596 Net foreign exchange (gain) loss (2,168 ) (1,257 ) (449 ) (4,249 ) (304 ) Change in value of NEC TOKIN options 11,100 (2,500 ) (1,777 ) (2,100 ) (3,111 ) (Income) loss from discontinued operations — 164 (103 ) (5,379 ) 3,634 (Gain) loss on early extinguishment of debt — (1,003 ) — (1,003 ) — Professional fees related to financing activities — 1,142 — 1,142 — Legal expenses related to antitrust class actions 435 409 — 844 — Adjusted net income (loss) $ (1,597 ) $ 6,955 $ 1,714 $ 6,958 $ (17,494 ) Adjusted net income (loss) per share - basic $ (0.04 ) $ 0.15 $ 0.04 $ 0.15 $ (0.39 ) Adjusted net income (loss) per share - diluted $ (0.04 ) $ 0.13 $ 0.03 $ 0.13 $ (0.39 ) Adjusted EBITDA $ 18,233 $ 27,608 $ 20,856 $ 91,742 $ 70,713 Weighted avg. shares - basic 45,443 45,407 45,174 45,381 45,102 Weighted avg. shares - diluted 45,443 52,228 52,523 52,588 45,102 (1) We have revised the quarter ended December 31, 2014 Non-GAAP presentation to conform with the quarter ended March 31, 2015.

Adjusted EBITDA Reconciliation Non-GAAP 16 For the Quarters Ended Fiscal Year (Amounts in thousands) Mar 2015 Dec 2014 (1) Mar 2014 2015 2014 Net income (loss) $ (19,847 ) $ 2,914 $ (14,447 ) $ (14,143 ) $ (68,503 ) Interest expense, net 10,017 9,933 10,658 40,687 40,767 Income tax expense (benefit) 3 1,359 (2,811 ) 5,227 1,482 Depreciation and amortization 10,074 9,720 12,175 40,768 49,527 EBITDA 247 23,926 5,575 72,539 23,273 Excluding the following items Restructuring charges 3,437 6,063 5,954 13,017 14,122 Plant shut-down costs — — 2,668 889 2,668 Write down of long-lived assets — — 1,118 — 4,476 ERP integration costs 1,273 671 837 3,248 3,880 Plant start-up costs 651 1,144 669 4,556 3,336 NEC TOKIN investment related expenses 226 485 618 1,778 2,299 Stock-based compensation 1,328 1,232 579 4,512 2,909 Inventory write downs — — — — 3,886 (Gain) loss on sales and disposals of assets 538 (574 ) (39 ) (221 ) 32 Inventory Revaluation (927 ) (927 ) — — — (Income) loss from discontinued operations — 164 (103 ) (5,379 ) 3,634 Equity (gain) loss from NEC TOKIN 2,093 (1,367 ) 4,127 2,169 7,090 Long-term receivable write down — — — — 1,444 Infrastructure tax — — 1,079 — 1,079 Net foreign exchange (gain) loss (2,168 ) (1,257 ) (449 ) (4,249 ) (304 ) Change in value of NEC TOKIN options 11,100 (2,500 ) (1,777 ) (2,100 ) (3,111 ) (Gain) loss on early extinguishment of debt — (1,003 ) — (1,003 ) — Professional fees related to financing activities — 1,142 — 1,142 — Legal expenses related to antitrust class actions 435 409 — 844 — Adjusted EBITDA $ 18,233 $ 27,608 $ 20,856 $ 91,742 $ 70,713 (1) We have revised the quarter ended December 31, 2014 Non-GAAP presentation to conform with the quarter ended March 31, 2015.

Non-GAAP Financial Measures Non-GAAP Financial Measures Included in this presentation are certain non-GAAP financial measures designed to complement the financial information presented in accordance with generally accepted accounting principles in the United States of America because management believes such measures are useful to investors. Adjusted gross margin Adjusted gross margin represents net sales less cost of sales excluding adjustments which are outlined in the quantitative reconciliation provided earlier in this presentation. Management uses Adjusted gross margin to facilitate our analysis and understanding of our business operations and believes that Adjusted gross margin is useful to investors because it provides a supplemental way to understand the underlying operating performance of the Company. Adjusted gross margin should not be considered as an alternative to gross margin or any other performance measure derived in accordance with GAAP. Adjusted selling, general and administrative expenses Adjusted selling, general and administrative expenses represents selling, general and administrative expenses excluding adjustments which are outlined in the quantitative reconciliation provided earlier in this presentation. Management uses Adjusted selling, general and administrative expenses to facilitate our analysis and understanding of our business operations and believes that Adjusted selling, general and administrative expenses is useful to investors because it provides a supplemental way to understand the underlying operating performance of the Company. Adjusted selling, general and administrative expenses should not be considered as an alternative to selling, general and administrative expenses or any other performance measure derived in accordance with GAAP. Adjusted operating income Adjusted operating income represents operating income (loss), excluding adjustments which are outlined in the quantitative reconciliation provided earlier in this presentation. Management uses Adjusted operating income to facilitate our analysis and understanding of our business operations and believes that Adjusted operating income is useful to investors because it provides a supplemental way to understand the underlying operating performance of the Company. Adjusted operating income should not be considered as an alternative to operating loss or any other performance measure derived in accordance with GAAP. 17

Non-GAAP Financial Measures Continued Adjusted net income (loss) and Adjusted EPS Adjusted net income (loss) and Adjusted EPS represent net income (loss) and EPS, excluding adjustments which are more specifically outlined in the quantitative reconciliation provided earlier in this presentation. Management uses Adjusted net income and Adjusted EPS to evaluate the Company's operating performance and believes that Adjusted net income and Adjusted EPS are useful to investors because they provide a supplemental way to possibly better understand the underlying operating performance of the Company. Adjusted net income and Adjusted EPS should not be considered as alternatives to net income, operating income or any other performance measures derived in accordance with GAAP. Adjusted EBITDA Adjusted EBITDA represents net loss before income tax expense (benefit), interest expense, net, and depreciation and amortization expense, excluding adjustments which are more specifically outlined in the quantitative reconciliation provided earlier in this presentation. We present Adjusted EBITDA as a supplemental measure of our performance and ability to service debt. We also present Adjusted EBITDA because we believe such measure is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. We believe Adjusted EBITDA is an appropriate supplemental measure of debt service capacity, because cash expenditures on interest are, by definition, available to pay interest, and tax expense is inversely correlated to interest expense because tax expense goes down as deductible interest expense goes up; depreciation and amortization are non-cash charges. The other items excluded from Adjusted EBITDA are excluded in order to better reflect our continuing operations. In evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses similar to the adjustments in this presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these types of adjustments. Adjusted EBITDA is not a measurement of our financial performance under GAAP and should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating activities as a measure of our liquidity. 18

Non-GAAP Financial Measures Continued Our Adjusted EBITDA measure has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are: • it does not reflect our cash expenditures, future requirements for capital expenditures or contractual commitments; • it does not reflect changes in, or cash requirements for, our working capital needs; • it does not reflect the significant interest expense or the cash requirements necessary to service interest or principal payment on our debt; • although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and our Adjusted EBITDA measure does not reflect any cash requirements for such replacements; • it is not adjusted for all non-cash income or expense items that are reflected in our statements of cash flows; • it does not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations; • it does not reflect limitations on or costs related to transferring earnings from our subsidiaries to us; and • other companies in our industry may calculate this measure differently than we do, limiting its usefulness as a comparative measure. Because of these limitations, Adjusted EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business or as a measure of cash that will be available to us to meet our obligations. You should compensate for these limitations by relying primarily on our GAAP results and using Adjusted EBITDA only supplementally. 19