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The Middleby Corporation

The Middleby Corporation

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The Middleby Corporation

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  1. The Middleby Corporation June 3, 2008 Sidoti Fifth Annual Boston Emerging Growth Institutional Investor Forum 1

  2. Forward Looking Statements 2 Statements made in this presentation or otherwise attributable to the company regarding the company's business which are not historical fact are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The company cautions investors that such statements are estimates of future performance and are highly dependent upon a variety of important factors that could cause actual results to differ materially from such statements. Such factors include, but are not limited to variability in financing costs; quarterly variations in operating results; dependence on key customers; international exposure; foreign exchange and political risks affecting international sales; changing market conditions; the impact of competitive products and pricing; the timely development and market acceptance of the company's products; the availability and cost of raw materials; and other risks detailed herein and from time-to-time in the company's SEC filings.

  3. Investment Highlights • Leading value-added manufacturer of hot commercial food service and processing equipment (#1 or #2 market share in each product) • Products are critical to customers, represent small portion of their budgets, and provide high ROIs • Unique global operating platform • U.S. restaurant sales have never declined • Diversified revenue base with exposure to high growth end markets • Focus on continued operational improvements and margin expansion • Successful track record of creating significant value through acquisitions • Proven senior management team 3

  4. The Middleby Corporation is the worldwide leader in the manufacturing and distribution of a broad line of cooking, warming and preparation equipment for the commercial restaurant and food processing industries Headquartered in United States (Chicago, Illinois) Publicly traded on U.S. stock exchange (NASDAQ symbol: MIDD) $500 million in annual revenue, 2007 1,200 employees worldwide 15 worldwide manufacturing facilities 12 U.S. Facilities 3 European Facilities 2 Asian Facilities Company Snapshot 4

  5. Financial Performance Financial Performance Sales Gross Profit ($ in millions) ($ in millions) 30% CAGR 35% CAGR EBITDA EPS ($ in millions) 45% CAGR 80% CAGR 5

  6. Free Cash Flow Free Cash Flow ($ in millions) Free Cash Flow1 46% 6-Yr CAGR Significant free cash flow generation 1Free Cash Flow = EBITDA - Capital Expenditures 6

  7. Company Breakdown 7

  8. Diverse and Stable Revenue Base New Store Openings 33% Menu Changes 33% Replacement & Maintenance 34% Food Processing 10% Growing international markets International Food Service 20% Institutional 10% Allows restaurants to differentiate themselves in a competitive market Independent 10% Casual 10% Domestic Food Service Pizza 10% Installed base of aged equipment in 850,000 establishments QSR 10% Fast Casual 20% End Market Product Use Stable, diversified revenue base with exposure to high growth end markets and limited exposure to new U.S. restaurant openings 8

  9. Industry Leading Brands - Foodservice #1 in Pizza Chains #1 in Convenience Stores #1 in Fast Casual #1 in Deli and Sandwich Shops #1 in Steakhouses and Seafood #1 in Chicken Outlets #1 in Pan-Asian Cuisine #2 in QSR #2 in Casual Dining 9

  10. Industry Leading Brands – Food Processing #1 in Sausages, Hot Dogs and Ham #1 in Chicken Preparation #2 in Bacon #2 in Burger Patties #2 in Meat Packaging 10

  11. Disruptive Technologies Wow Oven Hydrovection Oven Visual Cooking Solstice Fryer • Automated oven with energy management system • Combination steam and convection in one cavity • Most energy efficient oven • Self cleaning burner 500 Series Range Ventless Hoods Enduraheat Rhapsody Oven • Non-clog burner and water proof controls • Used by the best steakhouses in the world • Utilizing induction to hold food for extended periods • V-air technology cooks bread in less than 15 minutes KI AWARD KI AWARD KI AWARD KI AWARD We focus on the development of innovative foodservice equipment 11

  12. Value Added Offering Limited Service Restaurant Unit Economics Illustrative Middleby Product Economics % Sales • Investment $10,000 • Yearly Depreciation1,2 $1,428 • Yearly Savings • Labor $1,200 • Energy $4,200 $5,400 • Other Savings • Safety • Speed • Less Downtime • IRR3 50% • Payback period < 2 years Sales $2,200,000 100.0% Cost of Food & Beverage 638,000 29.0% Pitco Fryer: $10,000 Gross Profit 1,562,000 71.0% Salaries, Wages, Benefits 667,000 30.3% Life: 7 Years Direct Operating Expenses 106,000 4.8% $1,428 Marketing 46,000 2.1% Deprecation Per Year: $1,428 Utilities 68,000 3.1% Occupancy 163,000 7.4% Deprecation/Sales: 0.06% Repairs and maintenance 37,000 1.7% Depreciation 42,000 1.9% G&A 55,000 2.5% Other/Corporate Overhead 130,000 5.9% Operating Profit 249,000 11.0% Product represents a small investment and provides an attractive ROI/payback Source: National Restaurant Association; Deloitte & Touch; Management Estimates 1 Assumes straight-line depreciation over 7-years. Yearly annual depreciation is less than 0.1% of cost structure. 2 Minimal maintenance spend in first 2-3 years, $500 per year thereafter 3 Pre-tax and financing 12

  13. Premier Customers Blue-chip customer base Long standing relationships Limited customer concentration Large installed base Serve all food segments 13

  14. Global Reach Test kitchens throughout the world allow Middleby to educate customers on the benefits of its equipment through hands-on experience and training Worldwide service is critical and highly valued by U.S. chains expanding into international markets Worldwide sales infrastructure allows direct contact with key decision makers, especially in high-growth markets Philippines and China manufacturing capabilities provides regional presence in high-growth Asian markets Manufacturing facility, sales office and test kitchen Sales office with test kitchen Sales office only Mississauga, Ontario, Canada# of Employees: 2 Bilbao, Spain# of Employees: 11 Manchester, UK# of Employees: 20 Delhi, India# of Employees: 5 Seoul, South Korea# of Employees: 11 Shanghai, China# of Employees: 14 Taipei, Taiwan# of Employees: 7 Manila, Philippines# of Employees: - Manufacturing: 95 - Sales & Dist.: 16 Mexico City, Mexico# of Employees: 26 Key Advantages 14

  15. Competitive Advantage Sales & Marketing • Strong relationships with dealers • Key partnerships w/leading chains • Only viable choice for many product categories • Emphasis on cross-selling Research & Development Acquisition Capability Service Management Team • Industry leading innovation process (“customer driving”) • Emphasis on quality • 6-8 new products each year • Ability to measure customer savings • Focus on leading brands • Proven ability to transform acquired companies • Preferred purchaser • Industry leading customer service • “No-quibble” warranty • Test kitchens throughout world • Experienced and proven to deliver results • Strong performance culture • Equity ownership of >10% Manufacturing • Efficient operations & use of capital allows for 80%+ ROTIC • 15 manufacturing facilities throughout the world • Focus on working capital management A differentiated business model 15

  16. New Product Pipeline - Foodservice Mini WOW! Oven Rethermalizer Solstice Supreme Fryer Plancha and Satay Ovens 500 Series Range Tanduri Oven Endura Heat 2007 Introductions 2008 Introductions • High H Oven • Hydrovection Oven • Rocket Fryer • Ventless Hood • Rhapsody Oven • Visual Cooking Combi-Ovens • Wall Oven Residential line New Products Represent more than 20% of Net Sales 16

  17. New Product Pipeline – Food Processing Cyclone Belt Oven Flash Pasteurization Mid-Size J-Con Oven Wireless Controls • Conveyor Fryer • Co-Extrusion • Forming Equipment • Intellijet Water Cutter 2007 Introductions 2008 Introductions New products typically carry profit margins >5% higher than existing products 17

  18. Financial Performance Financial Performance Sales Gross Profit ($ in millions) ($ in millions) 30% CAGR 35% CAGR EBITDA EPS ($ in millions) 45% CAGR 80% CAGR 18

  19. Favorable Industry Dynamics Favorable Demographics New Restaurant / Store Openings Menu Changes Replacement of Existing Equipment Expansion of International Markets Rising Foodservice Operator Costs Many factors support growing demand for foodservice equipment 19