2004 Q1 TRW Auto Earnings Presentation

TRW Automotive News 12025 Tech Center Drive Livonia, Mich. 48150 USA Release

Investor Relations Contact: Patrick R. Stobb (734) 853-6966 Media Contact:

Manley Ford (734) 266-2616

TRW Automotive Reports First-Quarter 2004 Financial Results; Reduces Total Gross Debt by $494 Million LIVONIA, MICHIGAN, May 5, 2004 — TRW Automotive Holdings Corp. (NYSE:

TRW), the global leader in active and passive safety systems, today reported first-

quarter 2004 results with sales of just over $2.9 billion and net earnings of $2 million

or 2 cents per share, which includes expenses of $47 million or 48 cents per share for

charges associated with debt repayment transactions. First quarter earnings

excluding these charges were $49 million or 50 cents per share. During first-quarter

2004, TRW Automotive Holdings Corp. (the “Company”), which is the parent

company of TRW Automotive Inc., reduced total gross debt by $494 million. During

the quarter, the Company completed its initial public offering (“IPO”) of approximately

24.1 million shares of common stock on February 6, 2004.

In the prior year, the Company reported sales of $940 million and net losses of $46

million for the one-month period ended March 28, 2003. This reporting period was

the first month of results for the Company following the February 28, 2003 acquisition

of the former TRW Inc.’s automotive business by affiliates of The Blackstone Group

L.P. (“Blackstone”) from Northrop Grumman Corporation. The predecessor company

reported sales of $1.9 billion and net earnings of $31 million for the two-month period

ended February 28, 2003.

“Although our initial public offering in February of this year marked another major

milestone in the Company’s evolution, the event does not overshadow our product

development efforts and recent operational and financial achievements,” said John C.

Plant, president and chief executive officer. “These factors have contributed to our

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success at winning new business at planned rates from many of the world’s leading

automotive manufacturers. By focusing on automotive safety systems and

consistently offering our customers innovative and high-quality products, we have

established ourselves as one of the world’s most diversified major automotive

suppliers with leading market positions in our primary product lines.”

As a result of the Blackstone acquisition on February 28, 2003, certain consolidated

and combined financial information relating to first-quarter 2003 contained within this

release (labeled as pro forma) has been adjusted to illustrate the estimated pro forma

effects of such acquisition and a subsequent July 2003 debt refinancing, as if these

transactions had occurred on January 1, 2003.

First-Quarter 2004 Compared to Pro Forma First-Quarter 2003 The Company reported first-quarter 2004 sales of just over $2.9 billion, an increase of

$110 million or about 4 percent from prior year pro forma sales of $2.8 billion. The

increase can be attributed to foreign currency translation and sales of new products,

partially offset by pricing provided to customers, lower customer volumes and a

reduction in sales due to divestitures. Operating income for first-quarter 2004 was

$153 million, a decline of $24 million compared to the prior year pro forma operating

income. This decrease occurred mainly as a result of a $39 million decline in net

pension and OPEB income due primarily to the application of purchase accounting in

2003. Excluding this decline, operating income increased by $15 million compared to

the previous year’s pro forma operating income.

The Company reported first-quarter 2004 net earnings of about $2 million or 2 cents

per share in the quarter, compared to pro forma net earnings of $48 million in the

prior year. First-quarter 2004 earnings were negatively impacted by $47 million or 48

cents per share for prepayment premiums on high yield notes redeemed with

proceeds from the Company’s initial public offering and other expenses related to a

January 2004 bank debt refinancing. The debt repayment charges are U.S. based

and therefore carry zero tax benefit due to a U.S. tax loss position. Excluding the

debt repayment charges, the Company’s first-quarter 2004 earnings were $49 million

or 50 cents per share, an increase of $1 million compared to the prior year pro forma

earnings despite having a $39 million pre-tax decline in net pension and OPEB

income.

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During first-quarter 2004, the Company reported pre-tax restructuring charges of $5

million and amortization of intangibles (principally customer relationships) of $9

million. In comparison, the prior year quarter included $10 million of pre-tax

restructuring and other unusual charges and amortization of intangibles of $6 million.

The Company reported EBITDA (earnings before interest, losses on sale of

receivables, gain (loss) on retirement of debt, taxes, depreciation and amortization) of

$276 million for first-quarter 2004 compared to $295 million the previous year. As

described previously, first-quarter 2004 results were negatively impacted by a $39

million reduction in net pension and OPEB income compared to the previous year.

Excluding the effects of the $39 million reduction, EBITDA in first-quarter 2004

improved by over 7 percent compared to the prior year. Please see the

accompanying schedules for a reconciliation of EBITDA to the closest GAAP

equivalent.

Capital/Liquidity As of March 26, 2004, the Company had $3,314 million of debt and $465 million of

cash and marketable securities. At quarter-end, net debt (defined as debt less cash

and marketable securities) totaled $2,849 million, a $115 million reduction from the

level of net debt outstanding at December 31, 2003. Gross debt was reduced during

the quarter by $494 million, which included the redemption of $287 million, net of

premiums, of portions of our Senior and Senior-Subordinated notes with net proceeds

raised from our February IPO. Net cash outflow from operating and investing

activities during the quarter, which is typically a cash usage quarter due to

seasonality, amounted to $171 million. Capital expenditures during the quarter

totaled $67 million, compared to $11 million and $66 million, or $77 million pro forma,

for the one-month period ended March 28, 2003 and the two-month period ended

February 28, 2003, respectively.

2004 Outlook The Company reiterates its full-year guidance, which calls for expected sales in the

range of $11.4 to $11.6 billion. The Company also expects full-year earnings per

share in the range of $1.08 to $1.23, which includes the previously mentioned first-

quarter charges of $47 million or 47 cents per share for expenses related to debt

repayment and refinancing transactions, or $1.55 to $1.70 excluding these charges.

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Further, this guidance includes pre-tax expenses of approximately $33 million for

amortization of intangibles (principally customer relationships) and approximately $30

million related to restructuring.

For second-quarter 2004, the Company expects revenue of approximately $3 billion

and earnings per share in the range of $0.57 to $0.65, which includes pre-tax

restructuring charges of approximately $8 million.

Reconciliation to GAAP For a reconciliation of the pro forma and non-GAAP historical numbers appearing in

this release to GAAP, please see the accompanying schedules.

About TRW With 2003 sales of $11.3 billion, TRW Automotive ranks among the world's top 10

automotive suppliers. Headquartered in Livonia, Michigan, USA, the Company,

through its subsidiaries, employs approximately 61,000 people in 22 countries. TRW

Automotive products include integrated vehicle control and driver assist systems,

braking systems, steering systems, suspension systems, occupant safety systems

(seat belts and airbags), electronics, engine components, fastening systems and

aftermarket replacement parts and services. TRW Automotive news is available on

the internet at www.trwauto.com.

Forward-Looking Statements This release contains statements that are not statements of historical fact, but instead

are forward-looking statements. All forward-looking statements involve risks and

uncertainties. Our actual results could differ materially from those contained in

forward-looking statements made in this release. Such risks, uncertainties and other

important factors which could cause our actual results to differ materially from those

contained in our forward-looking statements are set forth in the TRW Automotive

Holdings Corp. final prospectus dated as of February 2, 2004 (the "Prospectus") filed

with the Securities and Exchange Commission (the "SEC") pursuant to Rule

424(b)(4) and our Report on Form 10-K for the fiscal year ended December 31, 2003

(the “10K”), and include: our substantial leverage; the highly competitive automotive

parts industry and its cyclicality; pricing pressures from our customers; increasing

costs for purchased components and raw materials; non-performance by, or

insolvency of, our suppliers; product liability and warranty and recall claims; our

dependence on our largest customers; limitations on flexibility in operating our

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http://www.trwauto.com/

business contained in our debt agreements; increases in interest rates; fluctuations in

foreign exchange rates; the possibility that our owners' interests will conflict with ours;

work stoppages or other labor issues and other risks and uncertainties set forth under

"Risk Factors" in the Prospectus, in the 10-K and in our other SEC filings. We do not

intend or assume any obligation to update any of these forward-looking statements.

# # #

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TRW Automotive Holdings Corp.

Index of Historical and Pro Forma Consolidated and Combined Financial Information

Page Periods Ended March 26, 2004, March 28, 2003, and February 28, 2003

Consolidated and Combined Interim Statements of Operations for the three months ended March 26, 2004 (unaudited), the one month ended March 28, 2003 (unaudited) and the two months ended February 28, 2003 ......................................................................A2 Consolidated Balance Sheets – March 26, 2004 (unaudited) and December 31, 2003 ............................A3 Reconciliation of Historical to Pro Forma Consolidated and Combined Statements of Operations for the one month ended March 28, 2003 and the two months ended February 28, 2003 ..........................................................................................................................A4 Historical and Pro Forma Consolidated and Combined Statements of Operations for the three months ended March 26, 2004 and March 28, 2003........................................................................A5 Reconciliation of GAAP Net Income to Historical and Pro Forma EBITDA (unaudited) for the three months ended March 26, 2004 and March 28, 2003 ............................................................A6

The accompanying historical and pro forma consolidated and combined financial information and reconciliation of GAAP net income to historical and pro forma EBITDA should be read in conjunction with the TRW Automotive Holdings Corp. Form 10-K for the year ended December 31, 2003, which contains historical consolidated and combined financial statements and the accompanying notes to consolidated and combined financial statements and unaudited pro forma consolidated and combined financial information and accompanying notes to unaudited pro forma consolidated and combined financial information. The accompanying unaudited pro forma consolidated and combined financial information is intended to give effect to the February 28, 2003 acquisition of the former TRW Inc.’s automotive business by affiliates of The Blackstone Group L.P. from Northrop Grumman Corporation and the July 22, 2003 refinancing of a portion of debt entered into in connection with the acquisition, as if these transactions had occurred on January 1, 2003. The unaudited pro forma consolidated and combined financial information is based upon available information and certain assumptions we believe are reasonable. However, these statements are for informational purposes only and are not intended to represent or be indicative of the consolidated results of operations or financial position that would have been reported had the acquisition been completed as of January 1, 2003, and should not be taken as representative of future consolidated results of operations or financial position.

A2


Consolidated and Combined Interim Statements of Operations

Successor Predecessor

(In millions, except per share amounts)

Three months

ended March 26,

2004

One month ended

March 28, 2003

Two months

ended February 28,

2003

(unaudited) (unaudited)

Sales........................................................................................ $ 2,923 $ 940 $ 1,916 Cost of sales............................................................................ 2,604 863 1,686 Gross profit ......................................................................... 319 77 230 Administrative and selling expenses....................................... 124 38 100 Research and development expenses...................................... 37 13 27 Amortization of intangible assets ........................................... 9 1 2 Other (income) expense — net ............................................... (4) (6) 4 Operating income ............................................................... 153 31 97 Interest expense, net ............................................................... 63 42 47 Loss on retirement of debt ...................................................... 47 — — Loss on sales of receivables.................................................... — 18 — Earnings (losses) before income taxes................................ 43 (29) 50 Income tax expense ............................................................... 41 17 19 Net earnings (losses) ......................................................... $ 2 $ (46) $ 31 Basic earnings (losses) per share: Earnings (losses) per share ................................................... $ 0.02 $ (0.53) Weighted average shares ...................................................... 94.3 86.8 Diluted earnings (losses) per share: Earnings (losses) per share ................................................... $ 0.02 $ (0.53) Weighted average shares ...................................................... 97.8 86.8

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Consolidated Balance Sheets

As of

(Dollars in millions) March 26,

2004 December 31,

2003 (unaudited)

ASSETS

Current assets: Cash and cash equivalents ............................................................................. $ 449 $ 828 Marketable securities ..................................................................................... 16 16 Accounts receivable, net ............................................................................... 2,115 1,643 Inventories ..................................................................................................... 564 635 Prepaid expenses............................................................................................ 93 73 Deferred income taxes ................................................................................... 120 120Total current assets ............................................................................................ 3,357 3,315 Property, plant and equipment ........................................................................... 2,826 2,877 Less accumulated depreciation and amortization........................................... 471 378Total property, plant and equipment — net ....................................................... 2,355 2,499 Intangible assets: Goodwill ......................................................................................................... 2,487 2,503 Other intangible assets .................................................................................... 858 856 3,345 3,359 Less accumulated amortization...................................................................... 49 37Total intangible assets — net ............................................................................. 3,296 3,322 Prepaid pension cost .......................................................................................... 134 120 Deferred income taxes ....................................................................................... 129 129 Other assets........................................................................................................ 504 522 $ 9,775 $ 9,907 LIABILITIES, MINORITY INTERESTS AND STOCKHOLDERS’ EQUITY Current liabilities: Short-term debt .............................................................................................. $ 66 $ 76 Current portion of long-term debt .................................................................. 22 24 Trade accounts payable.................................................................................. 1,706 1,626 Accrued compensation................................................................................... 325 338 Income taxes .................................................................................................. 204 187 Other current liabilities .................................................................................. 831 875Total current liabilities....................................................................................... 3,154 3,126 Long-term debt .................................................................................................. 3,226 3,708 Post-retirement benefits other than pensions ..................................................... 934 935 Pension benefits ................................................................................................. 853 838 Deferred income taxes ....................................................................................... 222 222 Long-term liabilities .......................................................................................... 300 300Total liabilities ................................................................................................... 8,689 9,129 Minority interests............................................................................................... 53 50 Stockholders’ equity: Capital Stock.................................................................................................... 1 1 Paid-in-capital.................................................................................................. 1,184 868 Accumulated deficit......................................................................................... (99) (101) Accumulated other comprehensive losses........................................................ (53) (40)Total stockholders’ equity ................................................................................. 1,033 728 $ 9,775 $ 9,907


Reconciliation of Historical to Pro Forma Consolidated and Combined Statements of Operations

Historical Pro Forma Successor Predecessor

(Dollars in millions)

One monthended

March 28,2003

Two monthsended

February 28,2003

Pro Forma Adjustments

Three monthsended

March 28, 2003

Sales ................................................................ $ 940 $ 1,916 $ (43) (a) $ 2,813 Cost of sales .................................................... 863 1,686 (92) (b) 2,457 Gross profit ................................................. 77 230 49 356 Administrative and selling expenses ............... 38 100 (2) (c) 136 Research and development expenses .............. 13 27 — 40 Amortization of intangible assets .................... 1 2 3 (d) 6 Other (income) expense — net........................ (6) 4 (1) (e) (3) Operating income ........................................ 31 97 49 177 Interest expense, net ........................................ 42 47 (12) (f) 77 Loss on sales of receivables ............................ 18 — (17) (f) 1 (Losses) earnings before income taxes........ (29) 50 78 99 Income tax expense ......................................... 17 19 15 (g) 51 Net (losses) earnings.................................. $ (46) $ 31 $ 63 $ 48

(a) Reflects the elimination of the sales of TRW Koyo Steering Systems Company (“TKS”), which was not

transferred to us as part of the Acquisition. (b) Reflects the elimination of $40 million of cost of sales of TKS, $12 million in pension and OPEB adjustments as a

result of purchase accounting, the elimination of the effects of a $35 million inventory write-up recorded as a result of the Acquisition and $5 million net decrease in depreciation and amortization expense resulting from fair value adjustments to fixed assets and certain intangibles.

(c) Reflects the elimination of $1 million administrative and selling expense of TKS, the addition of $1 million in the

annual monitoring fee payable to an affiliate of Blackstone and $2 million decrease in depreciation and amortization expense resulting from fair value adjustments to fixed assets and capitalized software.

(d) Reflects the incremental increase in amortization resulting from assignment of fair value to certain intangibles. (e) Reflects elimination of $1 million other expense related to TKS. (f) Reflects adjustments to present pro forma net financing costs based upon our new capital structure and the

initiation of our receivables facility. (g) Reflects the tax effect of the above adjustments at the applicable tax rates.

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Historical and Pro Forma Consolidated and Combined Statements of Operations

Historical Pro Forma Three months ended (Dollars in millions) March 26, 2004 March 28, 2003 Sales ............................................................................................. $ 2,923 $ 2,813 Cost of sales.................................................................................. 2,604 2,457 Gross profit............................................................................... 319 356 Administrative and selling expenses ............................................ 124 136 Research and development expenses............................................ 37 40 Amortization of intangible assets ................................................. 9 6 Other (income) expense — net ..................................................... (4) (3) Operating income ..................................................................... 153 177 Interest expense, net ..................................................................... 63 77 Loss on retirement of debt ............................................................ 47 — Losses on sales of receivables ...................................................... — 1 Earnings (losses) before income taxes...................................... 43 99 Income tax expense ...................................................................... 41 51 Net earnings (losses) ............................................................... $ 2 $ 48 Basic earnings (losses) per share: Earnings (losses) per share ......................................................... $ 0.02 $ 0.55 Weighted average shares ............................................................ 94.3 86.8 Diluted earnings (losses) per share: Earnings (losses) per share ......................................................... $ 0.02 $ 0.55 Weighted average shares ............................................................ 97.8 87.8


Reconciliation to Historical and Pro Forma EBITDA (unaudited)

The reconciliation schedule below should be read in conjunction with the TRW Automotive Holdings Corp. Form 10-K for the year ended December 31, 2003, which contains summary historical and pro forma financial data. The accompanying unaudited pro forma financial information is intended to give effect to the February 28, 2003 acquisition of the former TRW Inc.’s automotive business by affiliates of The Blackstone Group L.P. from Northrop Grumman Corporation and the July 22, 2003 refinancing of a portion of debt entered into in connection with the acquisition, as if these transactions had occurred on January 1, 2003. The EBITDA measure calculated in the following schedule is a measure used by management to evaluate operating performance. Management believes that EBITDA is useful to investors because it is frequently used by securities analysts, institutional investors and other interested parties in the evaluation of companies in our industry. EBITDA is not a recognized term under GAAP and does not purport to be an alternative to net earnings (losses) as an indicator of operating performance or to cash flows from operating activities as a measure of liquidity. Because not all companies use identical calculations, this presentation of EBITDA may not be comparable to other similarly titled measures of other companies. Additionally, EBITDA is not intended to be a measure of free cash flow for management’s discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements.

Historical Pro Forma Three months ended (Dollars in millions) March 26, 2004 March 28, 2003 GAAP net (losses) earnings........................................................... $ 2 $ (15) Income tax expense ................................................................... 41 36 Interest expense, net of interest income..................................... 63 89 Loss on retirement of debt ......................................................... 47 — Loss on sales of receivables....................................................... — 18 GAAP operating income ............................................................... 153 128 Pro forma adjustments:

Inventory fair value adjustment ................................................ — 35 Depreciation and amortization.................................................. — 4 Other ......................................................................................... — 10

Operating income .......................................................................... 153 177

Depreciation and amortization, net of pro forma adjustments......... 123 118 EBITDA(1)....................................................................................... $ 276 $ 295

(1) Reflects primarily non-cash decline in net pension and OPEB income of $39 million between the two periods.

Restructuring charges were $5 million in 2004 and $10 million in 2003.

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2004 First Quarter Financial Results Conference Call Presentation

May 5, 2004

© TRW Automotive Holdings Corp. 2004

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IntroductionPatrick StobbDirector, Investor Relations

First Quarter SummaryJohn C. PlantPresident and Chief Executive Officer


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Safe Harbor Statement

This material contains statements that are not statements of historical fact, but instead are forward-looking statements. All forward-looking statements involve risks and uncertainties. Our actual results could differ materially from those contained in forward-looking statements made in this release. Such risks, uncertainties and other important factors which could cause our actual results to differ materially from those contained in our forward-looking statements are set forth in the TRW Automotive Holdings Corp. final prospectus dated as of February 2, 2004 (the "Prospectus") filed with the Securities and Exchange Commission (the "SEC") pursuant to Rule 424(b)(4) and our Report on Form 10-K for the fiscal year ended December 31, 2003 (the “10-K”), and include: our substantial leverage; the highly competitive automotive parts industry and its cyclicality; pricing pressures from our customers; increasing costs for purchased components and raw materials; non-performance by, or insolvency of, our suppliers; product liability and warranty and recall claims; our dependence on our largest customers; limitations on flexibility in operating our business contained in our debt agreements; increases in interest rates; fluctuations in foreign exchange rates; the possibility that our owners' interests will conflict with ours; work stoppages or other labor issues and other risks and uncertainties set forth under "Risk Factors" in the Prospectus, in the 10-K and in our other SEC filings. We do not intend or assume any obligation to update any of these forward-looking statements.


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First Quarter Summary

• Achieved solid set of financial results with earnings at high-end of guidance range

• Sales of $2.9 billion, up 4% vs. 2003 pro forma

• Net Earnings of $2 million or $0.02 per share:– Includes $47 million or $0.48 per share related to

debt repayment transactions– Earnings of $49 million or $0.50 per share excluding

debt repayment charges

• Total gross debt down $494 million from year-end


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• New business wins on target, supports future growth expectations

• Pricing environment and commodity markets presented challenges in the quarter

• Cost reductions efforts mitigating demands– Cost savings initiatives driving costs down– Working collaboratively with customers on value

engineering – creates win/win


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• Executed planned restructuring actions

• Strengthened Asia Pacific manufacturing base– Expansion of China venture to include manufacture

of air bag modules and steering wheels– New China venture to manufacture and market

commercial steering gears– Will continue to invest in growing China market

• Actively managing cash needs

• PACE Award for Active Control Retractor


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Looking Ahead - 2004

11.9

15.9

11.7

16.2

5

10

15

20

2003 2004 2003 2004North America

18.8 19.2

10

15

20

2003 2004Europe

2004 Production Forecast(1)

(units in millions)Total

Big 3 • Continue to see stable industry fundamentals in all regions

• Big 3 production down in North America – higher concentration of products

• Industry-wide attention to safety related technologies and products remains at a high level

(1) Source: Primarily CSM Worldwide and internal company estimates.

2004 Comments


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2004 Expectations• Sales of $11.4 to $11.6 billion

• Earnings per share of $1.08 to $1.23:– Includes $47 million, or $0.47 per share of first

quarter charges relating to debt repayment transactions

– Earnings per share of $1.55 to $1.70 excluding these charges

• Earnings per share guidance also includes:– $33 million of amortization of intangibles (principally

customer relationships)– $30 million of restructuring charges


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Financial OverviewJoseph S. CantieExecutive Vice President andChief Financial Officer


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Q1 2004 Q1 2003

Pro Forma(1)2004 B/(W)

2003

Sales 2,923$ 2,813$ 110$

Operating Income 153 177 (24)

Interest(2) (63) (78) 15

Loss on Retirement of Debt (47) - (47) Taxes (41) (51) 10 Net Earnings 2$ 48$ (46)$

Earnings Per Share 0.02$ 0.55$

Weighted Avg. Diluted Shares 97.8 87.8

First Quarter 2004 Results(dollars in millions)

(1) Pro forma for the acquisition and July 2003 debt refinancing. Please refer to page A4 of the press release schedules that accompany this presentation for a reconciliation of pro forma to actual consolidated and combined financials.

(2) Includes interest expense and income for both years; Q1 2003 also includes loss on sales of receivables of $1 million.


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Q1 2004

Q1 2004 Less Debt Charges

Q1 2003 Pro

Forma(1)

Sales 2,923$ 2,923$ 2,813$

Operating Income 153 153 177

Interest(2) (63) (63) (78)

Loss on Retirement of Debt (47) - - Taxes (41) (41) (51) Net Earnings 2$ 49$ 48$

Earnings Per Share 0.02$ 0.50$ 0.55$

Weighted Avg. Diluted Shares 97.8 97.8 87.8 Effective Tax Rate 95% 46% 52%

Excludes $47 million for debt

repayment charges


(1) Pro forma for the acquisition and July 2003 debt refinancing. Please refer to page A4 of the press release schedules that accompany this presentation for a reconciliation of pro forma to actual consolidated and combined financials.

(2) Includes interest expense and income for both years; Q1 2003 also includes loss on sales of receivables of $1 million.


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Q1 2004

Q1 2003 Pro

Forma(1)

Net Earnings 2$ 48$ Income Tax Expense 41 51 Interest(2) 63 78 Loss on Retirement of Debt 47 - Operating Income 153$ 177$ Depreciation and amortization 123 118 EBITDA(3) 276$ 295$


Memo: Net pension and OPEB income down $39 million in Q1 2004 compared to pro forma Q1 2003

(1) Q1 2003 is pro forma for the acquisition and July 2003 debt refinancing. For a reconciliation of pro forma to actual consolidated and combined sales please refer to pages A4 of the press release schedules that accompany this presentation.

(2) Includes interest expense and income for both years; Q1 2003 also includes loss on sales of receivables of $1 million.(3) Please see page A6 of the press release schedules that accompany this presentation for a reconciliation of EBITDA to net earnings and our rationalization for using this metric.


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Deleveraging Continues (dollars in millions)

Net DebtNet Debt(1)(1) CommentsComments

$3,089 $2,923$2,456$2,582

$2,849$2,964

$3,295$3,437

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

'Feb 28 'Sep 26 'Dec 31 'Mar 26

(1) Net debt is equal to total indebtedness (including receivables facility) minus cash, cash equivalents and marketable securities. For net debt reconciliation to closest GAAP equivalent, please refer to the reconciliation on slide 17 of this presentation.

PIK Seller NoteOperating Co. Debt

• Reduced debt by $494 million in Q1 2004

• Net debt down $115 million in Q1 2004

• As of Mar 26, 2004, the Company had over $1 billion of liquidity– $500 million revolver– $400 million A/R facility– $449 million of cash on

balance sheet

• Paid down $51 million of Euro-based term loan on April 19


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Second Quarter 2004 Expectations

• Sales of approximately $3 billion

• Earnings per share of $0.57 to $0.65

• Earnings per share guidance includes:– $8 million of restructuring charges– $9 million for amortization of intangibles (principally

customer relationships)


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Defining Success in 2004

• IPO – completed on February 6, 2004

• New business wins at planned rates

• Achieve financial commitments, including– Sales and earnings– Implement cost savings at targeted levels– Complete restructuring actions– Reduction in effective tax rate

• Strengthen balance sheet by lowering debt


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Automotive


17

3/1/03 9/26/03 12/31/03 3/26/04Cash 449$ 399$ 828$ 449$ Marketable securities 26 16 16 16

Total 475 415 844 465

Short term debt 168 54 76 66

Long term debt:Term loan facilities 1,510 1,469 1,480 1,263 Senior notes 1,142 1,155 1,178 1,042 Senior subordinated notes 435 444 458 294 Lucas Varity senior notes 167 175 189 190 Other borrowings 142 41 45 66 Total Short & Long Term Debt 3,564 3,338 3,426 2,921

Net debt operating company 3,089$ 2,923$ 2,582$ 2,456$ Seller note 348 372 382 393 Net debt TRW Holdings 3,437$ 3,295$ 2,964$ 2,849$

Period-End Balances

Net Debt Reconciliation (Support Slide)(dollars in millions)

2004 Q1 TRW Auto Earnings Presentation

Economy & Finance

Transcript of 2004 Q1 TRW Auto Earnings Presentation