Medifast Inc · NYSE:MED
Medifast — Investor Presentation (January 2013)
33 slides from Medifast's investor presentation, Jan 17, 2013
Slide 1: Proven, Healthy Weight Loss - Investor Presentation
*Y Medifast. Proven, Healthy Weight Loss.. Investor Presentation Michael MacDonald, Chairman & Chief Executive Officer January, 2013
Slide 2: Safe Harbor Statement
‘YMedifast. safe Harbor Statement Certain information included in this presentation may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litiga
Slide 3: Medifast Products Recommended by Over 20,000 Doctors Since 1980
YMedifast. Medifast Products and Programs Have Been Recommended by over 20,000 Doctors Since 1980 and Used by Over a Million Customers Since 1980 FAST SAFE SIMPLE LONGTERM PORTABLE
Slide 4: Mission: create health, hope, and happiness through weight-management products
YMedifast. To create health, hope, and happiness through clinically proven weight-management products, programs, and support To combat the obesity epidemic and improve health in two ways: + Through clinically proven weight-management products & programs + Through multiple, innovative support channel
Slide 5: Investment highlights
YMedifast. Over 70) Unique Food , Items + Rapidly growing addressable market and significant market penetration opportunities + Vertically integrated model producing industry leading gross margins + Strong historical track record of growth in sales, profits and cash flows + Consistent profitability
Slide 6: Medifast 5&1 Plan, Transition, & Maintenance
YMedifast. Medifast 5&1 Plan, Transition, & Maintenance a) =] @ ‘Weight Loss Phase ‘Transition Phase Maintenance Phase (5&1 Pan ets Mans ‘en you ate ao a you gs wih, en you cmlted te varston share atta balanced, ed es ‘wel hlp you crease your dy ere by we hep you elle your day eae telacerots and aLe
Slide 7: Clinically Proven and Scientifically Based
YMedifast. Clinically Proven and Scientifically Based diet et wy .. in You can choose om among hundreds of woigh oss va plans, ets, pograms, pls =d be eiferent, though many a science and supp that sets Medifast apan MacDonald Center for - Obesity Prevention & Education 20,000
Slide 8: Take Shape
Take Shape “Medifast. Forte MEDICAL fast runsooy VMedifast. i ONE ' ‘ir cil is os th ends ipa er Gus ssc soca WOR.
Slide 9: Manufacturing and Distribution
YMedifast. MANUFACTURING AND DISTRIBUTION Company-owned state-of-the-art manufacturing and distribution facilities + Help support industry leading gross margins Capacity in place to drive aggressive growth “pasa Sealy Glens cs ara vs Mena seer cclaa ty ali ans Ga
Slide 10: Strong, Consistent Financial Performance: Revenue
Medifast. Strong, Consistent Financial Performance $298.2 5 o 32735 os $2576 $169.7 su102 7 BI 2008 2007 2011 —_‘FirstNine Months 2012 Revenue A SS SS a
Slide 11: Strong, Consistent Financial Performance: EPS
YMedifast. Strong, Consistent Financial Performance $1.35 $1.31 $1.02 Kau 7 4 2010 2011 —_FirstNine ‘Months2012 EPS “Rade uh sdeas ies eos Gidea ares ts ad one oe
Slide 12: Total Market $65B, Served Market $18B
“YMea ifast. Total Market — $65B Served Market — $18B Unserved Weight Loss" Served $478 Weight Loss $188 -Diet Soft Drinks Artificial Swee ‘eure. Conmis Data COC Data Watitistesas eames tis astm is Ure roca Gir 20,000 Scion ue 1566, ”
Slide 13: The Obesity Market is Growing
~YMedifast. Obese 173M. Sewer 1S Camus Data CDC Dt IS The Obesity Market is “Growing” ‘item, eahhy woaghs loin fonh dhs Sedna veccennendhid ey ei 20/000 Washers wives #9001 ry
Slide 14: Current Medifast National Market Coverage
YMedifast. Current Medifast National Market Coverage Significant Growth Opportunity to Cover “White Space” ir abl sig as se th ned cassis ey oer shoe “
Slide 15: International Coverage Opportunity
“YMedifast. International Coverage Opportunity 1.6B Overweight Globally and Expected to Grow 40% in Next 10 Years ta . SAL
Slide 16: YMedifast.
YMedifast.
Slide 17: Direct Selling Overview
YMedifast. Take Shape For lier run) oy YMedifast. Direct Selling Overview -US direct selling accounts for $30B — 24% or $7B comes from weight-loss products *15.6M people engaged in direct sales in the US U.S. is the #1 direct selling market in the world
Slide 18: Free Personal Health Coach & Mentor
“‘YMedifast. Take Shape For Life. ruasow Y Medifast. Free Personal Health Coach & Mentor to Guide Clients Through Their Weight Loss and Weight Management Journey + Health Coaches are required to take competency exam. + Health Coaches do not need to purchase product themselves to receive commission.
Slide 19: Take Shape for Life Revenues
YMedifast. Take Shape For Life. runsoer V Medifast. Di ss Revenues (iaS millions) ss57 $556 $493 5468 so Se suns ae sag | 4009 tao 2a10 3a10 4Q10 111 211 3011 4Q11 112 212 3012 $30 Tisha sab Sea loss lon siempre fy wr Sm cots ce Yo: *
Slide 20: Coverage Expansion
YMedifast. Take Shape For lie razor Y Medifast. Coverage Expansion + Expand coverage to new markets to cover “white space” + Leverage Success from Home magazine & Dr A’s book tour SUCCESS ion Maman of HEALTH
Slide 21: Improve Field Effectiveness
Medifast. Take Shape For Life. rveuzo ey V Medifast. Improve Field Effectiveness + Create development plan with simplified standards & processes + Enhance field communications & coach tools + Expand mobile “on-the-go” business PEGE. sepa TA
Slide 22: Direct
YMed ifast. “‘Y Medifast. DIRECT “YMedifast. y
Slide 23: Direct Response Revenues
YMedifast. “¥Med i fast. DIRECT Direct Response Revenues {iS mllons) ‘wlll * Only 10% of 210 DMAs* over $1M in annual sales + 66% of total volume is done by just 10% of DMA’s + 50% of 210 DMA’s under $100k in annual volume ‘September 2011 ~ August 2012 volume DMA = Designated Make Area Foose hl li o
Slide 24: Optimize Marketing & Promotional Spends to Improve Profit
YMedifast. “¥Med ifast. DIRECT Optimize Marketing & Promotional Spends to Improve Profit * Drive multi-media customer acquisition strategy (website/call center) + Continue to evaluate discounts & promotional offers + Ensure effective execution of capital & high resource projects Shopping is simple C
Slide 25: Website Performance
“YMed ifast. DIRECT = Website Performance Critical Success Factors ~~ Saiigiay. + Mobile friendly = + Improved navigation : SEO benefits > Ea Optimized content E- + Site load speed improved + Simplified design Multiple versions for new & =" returning visitors Pe pe ee
Slide 26: Weight Control Centers
YMedifast. YMe di fas t WEIGHT CONTROL CENTERSe rcsen, holly igh ths vane coon yer i000 dean ich 900
Slide 27: Weight Loss Management Partnership with Professionals
YMedifast. “YMedifast Weight Loss Management Partnership with a Team of Professionals Dedicated to Member Success + Brick-and-mortar centers offering supervised & structured programs + Currently operating 88 company-owned & 32 franchise-owned centers YMedifz Ymeairasi
Slide 28: Clinic Revenues
YMedifast. YY Medifi ast WEIGHT CONTROL CENTERSe Clinic Revenues sa (in $ millions) 5 a2 1a a 106 107 32 10 a2 Sg gr oe 6 4 2 2aio 3010 4q10 1011 201 30H 4a 1a 202 3012 ‘bien hash cg Sts ea ind ipsum iy tas SOii00 Mao ics 190:
Slide 29: Strengthening Corporate Center Operations
‘YMedifast. ‘Y Medifast WEIGHT CONTROL CENTERSe Focus on Strengthening Overall Corporate Center Operational, Member Acquisition, and Member Counseling Practices + Q1 loss led to significant employee restructure in April, 2012 + Removed many program & food discounts + Heightened focus on operational
Slide 30: Expand Franchise Footprint
~YMedifast. “YMed ifast WEIGHT CONTROL CENTERS. Expand Franchise Footprint + Focus on current franchisee expansion + International presence through Medix strategic partnership + Medifast to provide focused resources and support ‘rs Waa igh load teva ec oaeal eteneetaed ee eer SOIbed dersom tee YaRer
Slide 31: Medical Providers
YMedifast. “Y Medifast. MEDICAL PROVIDERS
Slide 32: Customer Medical Providers
YMedifast. A “Y Medifast. CUSTOMER MEDICAL PROVIDERS Clinics & Medi Spas Individual Practices 000 doe
Slide 33: Execution of strategic planks to drive aggressive growth
“VWlediyfast. - Execution of strategic planks and driving forces for change will drive aggressive growth + Infrastructure & process discipline lead to margin expansion opportunities + New talent and employee development = increased earnings and cash flow generation