NN (NNBR) Sidoti Micro-Cap Virtual Conference summary

Strategic transformation and leadership

• Undergoing a multi-phase enterprise transformation with new leadership, culture change, and operational improvements, now 50% complete after five quarters.

• Leadership team revamped over the past 18 months, focusing on profitability and performance at all plants, with ongoing efforts to strengthen second and third-level management.

• Targeting margin expansion and eliminating unprofitable operations, with all plants expected to be profitable in 2025.

• Focused on expanding margins and deleveraging through refinancing, cost improvements, and operational efficiency.

• Transformation plan includes cost optimization, portfolio curation, and profit growth, with significant progress at underperforming plants.

Growth strategy and business development

• Revenue growth expected to accelerate in 2024 and 2025, driven by over $136 million in new business wins and program launches, with a goal of $200 million over three years.

• Five-year plan targets $650 million in revenue, with $600 million organic and $50 million from acquisitions, and $325 million in new business wins.

• Pipeline of $720 million in opportunities, aiming for a 10% win rate, with dedicated sales teams for electrical and medical segments.

• Strategic focus on expanding in medical and electrical markets, growing in China, and leveraging a low-cost, globally distributed manufacturing footprint.

• Organic growth program is on track, supporting above-market growth rates.

Operational footprint and market positioning

• Operates 25 facilities across six countries and a China JV, serving over 1,100 customers globally, with a revenue mix of 61% Mobile Solutions and 39% Power Solutions.

• Global manufacturing footprint focused on serving local markets, with minimal cross-border exports and plant closures in Mexico and Michigan to optimize efficiency.

• U.S. operations benefit from tariffs and reshoring trends, with increased inbound inquiries for domestic production.

• China JV is growing, focused on local market and exports to non-U.S. countries, with $65 million forecasted for 2024 and additional business secured for 2025-2027.

• Well-positioned in Power Solutions (stamped/assembled products) and Mobile Solutions (machined parts), with strong new wins and a robust pipeline.