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Cooper Tire & Rubber Company

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Presentation on theme: "Cooper Tire & Rubber Company"— Presentation transcript:

1 Cooper Tire & Rubber Company

2 Proud of Where We've Been…Confident in Where We're Going
1914 Brothers-in-law John F. Schaefer and Claude E. Hart purchase M and M Manufacturing Company in Akron, producing tire patches, tire cement and tire repair kits. 1917 Company moves to Findlay, Ohio. 1920s Ira J. Cooper, director for the company, formed the Cooper During World War II, the company converts its “hard goods” department to wartime production. 1946 Cooper Corporation changes its name to Cooper Tire & Rubber Company. 1960 Cooper becomes a publicly held corporation and is listed on the New York Stock Exchange. 2003 Cooper acquires Mickey Thompson Performance Tires & Wheels. Cooper enters 50/50 joint venture with Kenda Rubber Industrial Company Ltd. for construction of a plant outside Shanghai, China, to produce radial passenger and light truck tires. In 2011, raises ownership to 100% Corporation. 2005 Cooper obtains 51% ownership in China’s third largest tire manufacturer. 2010 Cooper purchases an additional 14% of CCT, raising ownership stake to 65% 2012 Cooper acquires plant in Krusevac, Serbia 2014 Cooper establishes Global Technical Center in Findlay; relocates Asia Technical Center to Kunshan, China. Cooper sells its stake in CCT. Cooper purchases the highly regarded Avon TyresLimited, based in Melksham, England. 2015 Cooper announces that capital expenditures will range from $205 million to $215 million as major investments in plants continue.

3 A Monumental 100th Year! Celebrated year-round, all over the globe
A year of thanks—focused on people Employees Communities Suppliers Our loyal customers Put challenges behind us— exited the CCT joint venture in November 2014 Strong performance—The past three years have been the best (operating profit) in company's history (2012, 2013, 2014)

4 A Leader in the Tire Industry
12th largest global tire manufacturer and 5th largest in the U.S. 2014 unit sales of 46 million tires Seven tire manufacturing plants around the world 2014 revenue of $3.4 billion Traded on the NYSE (CTB) Primarily a replacement tire company, but emerging OE presence

5 customers' best service/value supplier
Our Value Proposition To be our customers' best service/value supplier Great Products Great Price Great Performance

6 Our Brands Cooper Tire & Rubber Company is the parent company of a global family of companies that specialize in the design, manufacture, marketing, and sales of passenger car and light truck tires. Cooper has joint ventures, affiliates and subsidiaries that also specialize in medium truck, motorcycle and racing tires. Cooper's headquarters is in Findlay, Ohio, with manufacturing, sales, distribution, technical and design operations within its family of companies located in 14 countries around the world.

7 Core Values: The Cooper Way
The Cooper Way comprises the core values that define who we are as a company. It guides every action we take and shapes our culture with every tire we produce.

8 Cooper performance trends
Net Sales ($M) Operating Profit ($M)

9 Cash + Low Debt + Credit Facilities = Financial Flexibility
Healthy Balance Sheet... ...With Ample Financing Flexibility Cash and cash equivalents ($M) 60% $400M Cash flow facility Q4 ’07 Q4 ‘14 $150M Accounts receivable securitization program Debt/Enterprise value1 -20 New Credit Facilities provide significant liquidity & borrowing capability 2008 2014 1. Debt is short-term debt, current portion of long-term debt and long-term debt

10 Investments Major Investments in the Business
Automation investment in Tupelo, Texarkana and Findlay Continued expansion and mix shift underway in Mexico New Global Technical Center in Findlay New Asia Technical Center in Kunshan (on grounds of CKT plant) Ramped-up Serbia production Returning Value to Shareholders Dividends—Cooper announced our 174th consecutive quarterly dividend in August 2015 ASR—$200 million accelerated share repurchase program completed in February 2015 New Share Repurchase Authorization—In February 2015, announced a new $200 million share repurchase authorization Capital Spending Trend ($M)

11 A Strong, Global Footprint

12 A Strong Global Footprint

13 New Structure Brad Hughes appointed COO Cohesive Global Approach
Responsibility for Cooper’s worldwide operations throughout North America, Asia, Europe and Latin America Cohesive Global Approach Develop, optimize and leverage… Brands Products Manufacturing footprint around the world Experienced business heads in each of our regions reporting to Brad Brad Hughes

14 Regional Leaders Phil Kortokrax Jeff Schumaker Luis Ceneviz
Vice President North America Tire Operations Jeff Schumaker Managing Director Cooper Tire Europe Luis Ceneviz Managing Director Latin America Tire Operations Allen Tsaur Senior Vice President Asia Tire Operations

15 We Have Set Bold Aspirations for the Future
2014 Long-term $3.4B net sales 8.8% operating margin 8-10% operating margin on a consistent basis $5-6B 10+%

16 Operations in the United States
5th largest manufacturer in North America Three tire manufacturing facilities (Findlay, Tupelo and Texarkana) and a mixing and bladder facility (Clarksdale) ~5,300 employees Max-Trac Tire Co., Inc. dba Mickey Thompson Performance Tires & Wheels; wholly-owned Cooper subsidiary Acquired in 2003 Premium brand, performance positioning ~73 employees Cooper Discoverer A/T3 Cooper CS5 Ultra Touring Deegan 38

17 Strategic Plan for The United States and Canada
Vision Diversify and grow in the most attractive segments to be our customers' best service/value supplier Strategic Focus Areas Generate unit volume demand by optimizing product and channel mix Penetrate OE Secure supply and grow TBR Continue product launch successes Focus on growth of the Cooper brand Convert capacity to grow more premium units Grow in underpenetrated channels Deemphasize wholesale private-label business Grow OE segment No more than 10% of business Enter car dealer replacement channel Further advance Cooper technology Recover and grow Roadmaster share Grow in OE segment Enter fleet replacement channel

18 Operations Outside of the U.S.
Cooper Tire Asia Cooper Tire Latin America Cooper Tire Europe ~1,100 employees Established operations in 2006 One manufacturing facility in China: Kunshan (CKT) --Wholly owned subsidiary Asia Technical Center opened in 2008, moved to new facility in 2014 ~1,100 total employees including JV partner Established in 2007 Corporacion de Occidente is a joint venture with Cooper owning 58% One manufacturing facility near Guadalajara ~1,400 employees Acquired operations in 1997 Two manufacturing facilities in Europe: Melksham (U.K.) and Krusevac (Serbia) Europe Technical Center opened in 2007

19 Strategic Plan for Asia, Europe and Latin America
Vision Achieve profitable, sustainable growth in our International segment to account for 50% of total company sales Strategic Focus Areas Secure supply and grow TBR Continue to penetrate China OE market Profitable growth in Western Europe Leverage our sourcing for growth in Eastern Europe Leverage footprint to grow in Latin America Increase pace of new product launches to meet customer needs Grow in long distance and city bus, as well as long-haul truck Improve PCR/TBR distribution channels Expand our OE position in China Generate consumer pull via increased brand recognition Clarify and strengthen product offering to customers Improve Cooper brand awareness and growth Grow profitably in key markets (U.K., Germany and Middle East) Improve service through local sourcing Improve manufacturing cost competitiveness Grow in high potential Eastern European countries and Russia Expand Mexico manufacturing Continue success in Mexico and Central America Leverage footprint to grow in the rest of Latin America


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