Earnings Presentation

James Ray - President & Chief Executive Officer

Q4 & FY 2023

Andy Cheung - Executive Vice President & Chief Financial Officer

March 5, 2024

Forward Looking Statements and Non-GAAP Financial Measures

These slides contain forward-looking statements that are subject to risks and uncertainties. These statements often include words such as "believe", "anticipate", "plan", "expect", "intend", "will", "should", "could", "would", "project", "targets" "forecast" "continue", "likely", and similar expressions. In particular, this document may contain forward-looking statements about the Company's expectations for future periods with respect to its plans to improve financial results, the future of the Company's end markets, changes in the Class 8 and Class 5-7 North America truck build rates, performance of the global construction equipment business, the Company's prospects in the wire harness, industrial automation and electric vehicle markets, the Company's initiatives to address customer needs, organic growth, the Company's strategic plans and plans to focus on certain

segments, competition faced by the Company, volatility in and disruption to the global economic environment, including inflation and labor shortages and the Company's financial position or other financial information. These statements are based on certain assumptions that the Company has made in light of its experience 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 those included in the Company's filings with the SEC. There can be no assurance that statements made in this document relating to future events will be achieved. The Company 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 the Company or persons acting on behalf of the Company are expressly qualified in their entirety by such cautionary statements.

See slide 15 for use of non-GAAP financial measures.

2

INTRODUCTION

James Ray

President & CEO

3

Q4 & Full Year 2023 Highlights

Q4 FINANCIAL HIGHLIGHTS

2023 HIGHLIGHTS

REVENUE

ADJUSTED EBITDA

$223

$10.3

MILLION

MILLION

ADJUSTED

ADJUSTED EPS

OPERATING INCOME

$0.09

$6.6

PER DILUTED SHARE

MILLION

IMPROVED PROFITABILITY

Adjusted

EBITDA Up 26%

Adjusted EBITDA margin Up 140 bps

FCF AND DEBT PAYDOWN

$19 MILLION

FCF

Net Leverage reduced from 2.2x to 1.5x

NEW BUSINESS WINS

>$150 MILLION

  • 2023 program wins, peak annual value when fully ramped, majority in Electrical System segment

2 NEW ELECTRICAL SYSTEMS PLANTS

  • Production ramping up at new Aldama, Mexico and Tangier, Morocco facilities

Note: US GAAP net income was $23.3M for Q4 2023. GAAP diluted income per share was

4

$0.70 for Q4 2023.

Recent Strategic Actions

North American Footprint Optimization

  • Actions taken to optimize footprint
  • Closing one facility and shifting production to other locations
  • Rationalizing higher-cost capacity to expand margins

Cost Reduction Efforts

  • Reducing organizational costs and aligning resources in support of growth product lines
  • Across multiple business segments
  • Ongoing efforts to align costs and improve margins

FinishTEK Sale

  • Hydrographic and paint decorator; previously part of Vehicle Solutions business
  • Sale completed January 31, 2024
  • Optimizes portfolio with more focus on core growth businesses

Improving Profitability and Increased Focus On Growing Electrical Systems

5

Fourth Quarter & Full Year 2023 Results

CONSOLIDATED RESULTS

Highlights

GAAP Measures

($ in millions except for share information)

Revenue

Operating Income

Operating Income Margin

Diluted EPS

NON-GAAP

Measures

($ in millions except for share information)

Adjusted EBITDA

Adjusted EBITDA Margin

Adjusted Diluted EPS

Free Cash Flow

Three Months

Ended Dec 31

2023 2022

$ 223.1 $ 234.9

5.0 (4.0)

2.2% (1.7)%

0.70 (0.98)

Three Months

Ended Dec 31

2023

2022

$ 10.3

$ 13.3

4.6%

5.7%

0.09 0.04

3.8 28.0

Twelve Months Ended Dec 31

2023 2022

$ 994.7 $ 981.6

48.1 20.1

4.8%

2.1%

1.47 (0.68)

Twelve Months Ended Dec 31

2023

2022

$ 67.6

$ 53.5

6.8%

5.4%

0.90 0.51

18.6 49.2

  • Record revenue in 2023, driven by continued price realization and contribution of new business wins; fourth quarter negatively impacted by lower volumes and strike impacts
  • Adjusted EBITDA margins up 140bps for the full year as gross margin expansion more than offsets higher SG&A; fourth quarter negatively affected by volumes and strike impacts
  • Adjusted EPS up ~76% driven by higher revenue and margins
  • Positive free cash flow in 2023, drives net leverage down to 1.5x

6

All values are in millions of dollars, except margin percentages, EPS, and Net Debt / Adj. EBITDA ratios

Q4'23 Adjusted EPS Bridge Including Special Items

$0.70

Reversal of non-cash tax

valuation allowance

($0.66)

Impact of a strike-

related labor stoppage

at a customer facility

$0.06

$0.15

$0.05

$0.09

$0.15

GAAP Earnings per Tax Adjustments*

Restructuring

Adj. EPS

Strike Impacts Adj. EPS (ex-special

Share

items)

All values are $/share; totals may differ slightly due to rounding

7

*Non-cash items

Electrical Systems

Sales and Adjusted Operating Income

Q4

Full Year

Highlights

Revenue ($mm)

• Strong revenue growth and margin expansion in the Q4 and full

year 2023as pricing and contributions from prior new wins

+27%

228.4

driving improved results

56.2

180.4

•

Increased pricing helped offset material cost increases and other

+19%

inflationary pressures

47.1

•

Q4 adjusted OI margin improvement of 30bps and full year 2023

Q4'22

Q4'23

2022

2023

adjusted OI margin improvement of 100bps; driven by volume leverage

and increased pricing Adjusted OI Margin

• Launched two new plants, one each in Mexico and Morocco with

+30bps

+100bps

minimal capital outlay

11.6%

11.9%

11.5%

10.5%

Q4'22

Q4'23

2022

2023

8

Vehicle Solutions

Sales and Adjusted Operating Income

Highlights

Q4

Full Year

Revenue ($mm)

• Q4 revenue negatively impacted by a labor strike at one customer facility

and softness in demand

142.8

-10%

587.1

• Full year 2023 revenue up slightly due to increased N.A. Class 8

579.7

+1%

128.4

production, partially offset by lower Europe and China volumes

• Q4 adjusted OI margin improvement of 20bps versus 2022; lower

Q4'22

Q4'23

2022

2023

volumes offset by increased pricing and cost controls

Adjusted OI Margin

• Full year 2023 adjusted OI margin improvement of 350bps; benefited

from increased pricing and cost reduction initiatives

  • Strong cash generation due to improved working capital and capital

+20bps

7.3%

expenditure management

3.1%

+350bps

2.9%

3.8%

Q4'22

Q4'23

2022

2023

9

Aftermarket & Accessories

Sales and Adjusted Operating Income

Q4

Full Year

Highlights

Revenue ($mm)

• Q4 revenue declines driven by lower volumes; 2022 results

benefited from significant backlog that didn't repeat in 2023

34.1

-8%

31.4

Q4'22

Q4'23

+5%

140.2

133.7

2022

2023

• Full year 2023 revenue increase of 5% driven by increased

pricing to offset material cost increases and other inflationary

pressures

• Q4 adjusted OI margin improvement of 20bps despite lower

revenue

Adjusted OI Margin

• Full year 2023 margin expansion of 330bpsdriven by

+20bps

10.8%

11.0%

Q4'22

Q4'23

+330bps

13.6%

10.3%

2022

2023

increased pricing

Seating

Mirrors

Wipers

10

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CVG - Commercial Vehicle Group Inc. published this content on 04 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 March 2024 12:36:11 UTC.