Nobility Homes, Inc. · OTC:NOBH

Nobility Homes — Investor Presentation (March 2006)

43 slides from Nobility Homes's investor presentation, Mar 14, 2006

  1. Slide 1: Nobility Homes, Inc.: Controlling Our Future Through Vertical Integration

    NOBILITY HOMES, INC. Controlling Our Future Through Vertical Integration 3/14/2006

  2. Slide 2: Forward-Looking Statements

    Forward-Looking Statements Certain statements in this report are forward-looking statements within the meaning of the federal securities laws, including our statement that working capital requirements will be met with internal sources. Although Nobility believes that the expectations reflected in su

  3. Slide 3: Mission Statement

    Mission Statement Nobility Homes, Inc. The mission of Nobility Homes, Inc. is to design and build homes that are leaders in quality, cost, and customer satisfaction through the integration of people, technology, and business systems and to transfer knowledge and experience throughout the company and

  4. Slide 4: Management

    Management Officers Years with Nobility ‹ Terry E. Trexler Chairman and President 39 ‹ Thomas W. Trexler Executive Vice President and Chief Financial Officer President Prestige Home Centers 15 ‹ Gloria J. Etheredge Secretary 39 ‹ Lynn J. Cramer, Jr. Treasurer 31 ‹ Edward C. Sims General Manager 34 ‹

  5. Slide 5: Management Ownership of the manufactured housing industry

    Management Ownership of the manufactured housing industry 66% 24% 19% 19% 3% 4% 2% Champion Cavco Fleetwood Cavalier Skyline Palm Harbor Nobility

  6. Slide 6: Institutional Ownership of the manufactured housing industry

    Institutional Ownership of the manufactured housing industry 89% 90% 73% 66% 57% 38% 13% Nobility Palm Harbor Cavalier Cavco Skyline Champion Fleetwood

  7. Slide 7: Condensed Consolidated Balance Sheets

    Condensed Consolidated Balance Sheets February 4, November 5, $ 2006 2005 Change Assets Cash, cash equivalents and short term investments $ 12,800,725 $ 14,782,709 $ (1,981,984) Accounts receivable - trade 430,860 250,376 180,484 Inventories 11,389,545 9,549,486 1,840,059 Prepaid expenses and other

  8. Slide 8: Condensed Consolidated Statements of Income

    Condensed Consolidated Statements of Income Twelve Months Ended February 4 February 5, % 2006 2005 Change Net sales $ 13,750,595 $ 11,511,134 19.45% Gross profit 4,113,035 3,211,433 28.07% 29.91% 27.90% Operating income 1,958,917 1,418,563 38.09% 14.25% 12.32% Other income 304,520 214,217 42.15% Inc

  9. Slide 9: Revenues (Millions)

    Revenues (Millions) $56.8 $50.1 $44.8 $41.6 $40.3 $36.5 $37.9 $39.2 $30.8 $29.6 $30.2 13.8 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  10. Slide 10: Revenues and Operating Income

    Revenues and Operating Income Revenue Operating Income $60.0 $10 $9 $50.0 $8 $7 $40.0 $6 $30.0 $5 $4 $20.0 $3 $2 $10.0 $1 $0.0 $0 2000 2001 2002 2003 2004 2005 Revenue Operating Income ($ in millions)

  11. Slide 11: Nobility's Revenue Compared to Industry-wide Shipments

    Nobility’s Revenue Compared to Industry-wide Shipments $60 400 350 $50 Units In Thousands Dollars In Millions 300 $40 250 $30 200 150 $20 100 $10 50 $0 0 1999 2000 2001 2002 2003 2004 2005 Nobility Revenues Industry-wide Shipments Estimated Industry-wide Shipments

  12. Slide 12: Gross Margin

    Gross Margin 30.0% 29.0% 27.2% 27.9% 25.5% 25.8% 26.1% 25.7% 25.9% 25.2% 26.0% 23.4% 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  13. Slide 13: Operating Income (Millions)

    Operating Income (Millions) $10 $9 $8 $7 $6 $5 $4 $3 $2 2000 2001 2002 2003 2004 2005 In Millions $2.25 $3.55 $3.93 $4.30 $6.54 $8.80

  14. Slide 14: Net Income (Millions)

    Net Income (Millions) $6.1 $4.7 $3.9 $3.0 $3.1 $3.0 $2.8 $2.4 $2.5 $2.3 $2.0 $1.4 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  15. Slide 15: Nobility's Net Income Compared to Industry-wide Shipments

    Nobility’s Net Income Compared to Industry-wide Shipments $7 400 $6 350 Units In Thousands Dollars In Millions 300 $5 250 $4 200 $3 150 $2 100 $1 50 $0 0 1999 2000 2001 2002 2003 2004 2005 Nobility Net Income Industry-wide Shipments Estimated Industry-wide Shipments

  16. Slide 16: Net Income (Percentage)

    Net Income (Percentage) 10.8% 10.8% 8.8% 9.0% 8.2% 8.3% 7.7% 7.9% 7.3% 6.9% 6.5% 6.4% 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  17. Slide 17: Earnings per Share

    Earnings per Share $1.49 $1.13 $0.79 $0.76 $0.77 $0.62 $0.58 $0.58 $0.49 $0.49 $0.41 $0.36 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  18. Slide 18: Cash Dividends Paid Per Common Share

    Cash Dividends Paid Per Common Share $0.30 $0.20 $0.10 $0.00 $0.00 2001 2002 2003 2004 2005

  19. Slide 19: Earnings per Share: Manufactured Housing Industry Comparison

    Earnings per Share Earnings per Share Change vs. Last Year (latest quarter) of the Manufactured Housing Industry Month/Year Current Prior Year Quarter Ended Quarter Quarter Cavalier 04 12/05 $0.59 $0.26 Cavco 03 12/05 $0.56 $0.34 Champion 04 12/05 $0.08 ($0.03) Fleetwood 03 01/06 $0.02 ($0.99) Nobil

  20. Slide 20: Return on Average Equity

    Return on Average Equity 23% 22% 22% 19% 18% 16% 14% 14% 12% 12% 11% 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  21. Slide 21: Return on Average Assets

    Return on Average Assets 19% 18% 17% 15% 15% 13% 13% 12% 12% 10% 10% 10% 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  22. Slide 22: Number of Floors Manufactured

    Number of Floors Manufactured 2522 2359 2147 2077 2128 1981 1749 1667 1687 1453 1241 479 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  23. Slide 23: Product Mix of the Manufactured Housing Industry

    Product Mix of the Manufactured Housing Industry 1% 18% 15% 20% 31% 31% 30% 99% 80% 82% 85% 69% 69% 70% Fleetw ood Cavco Cavalier Palm Harbor Skyline Cham pion Nobility Solid = Multi Section Shaded = Single Section

  24. Slide 24: New Homes Closed by Prestige

    New Homes Closed by Prestige 887 820 824 824 731 744 600 559 507 509 523 181 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  25. Slide 25: Average Retail Selling Price by Prestige

    Average Retail Selling Price by Prestige $63,457 $59,887 $55,770 $52,219 $50,124 $45,859 $41,760 $43,023 $38,100 $38,662 $36,500 $34,200 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  26. Slide 26: Average Gross Profit by Prestige

    Average Gross Profit by Prestige $12,541 $10,853 $9,166 $7,150 $6,702 $6,144 $5,391 $5,495 1999 2000 2001 2002 2003 2004 2005 2006 (ytd)

  27. Slide 27: Operating Income Per Division and Internalization Comparison

    Operating Income Per Division and Internalization Comparison PERIOD MFG RETAIL INS/FIN TOTAL % CHANGE 2006 (ytd) $ 975,000 $ 917,000 $ 169,000 $ 2,061,000 38% 47% 44% 8% 2005 $ 4,400,000 $ 3,700,000 $ 672,000 $ 8,772,000 34% 50% 42% 8% 2004 $ 4,483,000 $ 1,523,000 $ 558,100 $ 6,564,100 52% 68% 23% 9

  28. Slide 28: Prestige New Homes Financing Summary

    Prestige New Homes Financing Summary 1st Qtr 2006 2005 181 units 744 units Mortgage Financing Mortgage 37% Financing 34% Home Only Cash Financing Cash Home Only Sales 24% Sales Financing 39% 44% 22% 2004 2003 600 units 523 units Mortgage Mortgage Financing Financing 34% 49% Home Only Cash Home Only

  29. Slide 29: Comparison of Cumulative Total Shareholder Return

    Comparison of Cumulative Total Shareholder Return 500 450 400 350 300 250 200 150 100 50 0 2000 2001 2002 2003 2004 2005 PEER GROUP INDEX NASDAQ MARKET INDEX NOBILITY HOMES, INC. $0.30 Annual Cash Dividend January 2006 50% Stock Dividend February 1998 10% Stock Dividend January 1999 $0.20 Annual Cas

  30. Slide 30: Seasonally Adjusted Annualized Shipments May 2000 - December 2005

    0 50000 100000 150000 200000 250000 300000 May-00 Jul- 00 Sep-00 Nov-00 Jan-01 Mar- 01 May-01 Jul- 01 Sep-01 Nov-01 Jan-02 Mar- 02 May-02 Jul- 02 Sep-02 Nov-02 Jan-03 Mar- 03 May-03 Jul- 03 Sep-03 Nov-03 Jan-04 May 2000 — December 2005 Mar- 04 May-04 Jul- 04 Sep-04 Nov-04 Jan-05 Mar- 05 May-05 Jul-

  31. Slide 31: 2006 Objectives

    2006 Objectives ƒ Increase Revenues ƒ Improve Gross Margins ƒ Shareholders’ Return Exceeding 15 Percent

  32. Slide 32: Increase Revenues

    Increase Revenues ƒ Increase the Number of Prestige Retail Sales Centers ƒ Increase Same Store Sales ƒ Increase Market Share ƒ Increase Nobility/Prestige Name Recognition ƒ Introduce Additional “Special-Edition” Homes ƒ Purchase Homes from Outside Manufactures

  33. Slide 33: Improve Gross Margins

    Improve Gross Margins ƒ Increase Plant Capacity Utilization ƒ Higher Internalization ƒ Increase Sales at Existing Sales Center ƒ Increase margins at Retail ƒ Increase Finance Income ƒ Increase Insurance Sales Penetration

  34. Slide 34: Investment Strategies

    Investment Strategies ƒ Total vertically integrated home builder ƒ Distinguished niche in an expanding market area ƒ Strong name recognition ƒ Aggressive and experienced management team ƒ Impressive financial record and balance sheet ƒ History of stringent cost controls ƒ Excess plant capacity ƒ Exc

  35. Slide 35: Income of Manufactured Home Buyers

    Income of Manufactured Home Buyers Less than $9,999 $50,000 and over 9% 17% $10,000-$19,999 $40,000-$49,999 20% 13% $30,000-$39,999 $20,000-$29,999 18% 23% Median Income -- $28,000

  36. Slide 36: Ages of Household Head

    Ages of Household Head of Manufactured Home Buyers Less than 30 years 70 and older 7% 21% 30-39 years 16% 60-69 years 40-49 years 17% 19% 50-59 years 20%

  37. Slide 37: Employment Status of Household Head

    Employment Status of Household Head of Manufactured Home Buyers Part Time Not Employed 8% 8% Full Time 54% Retired 30%

  38. Slide 38: Household Size

    Household Size of Manufactured Home Buyers 5 or More 6% 1 Member 28% 3-4 Members 27% 2 Members 39% Average household size is 2.3 persons

  39. Slide 39: Manufactured Housing Shipments as a Percent of New Single Family Homes Sold

    Manufactured Housing Shipments as a Percent of New Single Family Homes Sold 33.7% 35.0% 32.4% 31.2% 30.6% 29.6% 30.0% 27.6% 27.8% 25.7% 26.1% 24.6% 25.2% 25.7% 24.4% 23.4% 25.0% 22.2% 20.0% 17.7% 14.8% 15.0% 10.8% 9.8% 10.0% 5.0% 0.0% 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998

  40. Slide 40: Manufactured Housing Shipments as a Percent of New Single Family Home Starts

    Manufactured Housing Shipments as a Percent of New Single Family Home Starts 35.0% 30.0% 24.0% 23.8% 23.8% 25.0% 22.7% 20.2% 20.7% 18.5% 18.4% 20.0% 17.2% 16.9% 16.8% 17.4% 16.9% 17.0% 16.9% 13.2% 15.0% 11.0% 10.0% 8.0% 7.5% 5.0% 0.0% 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998

  41. Slide 41: Manufactured Home Shipments, Housing Starts and Homes Sold (1986-2004)

    Manufactured Home Shipments, New Single Family Housing Units Started and New Single Family Homes Sold (1986-2004) New SF Housing MH as a % of New New SF Homes MH as a % of New Year MH Shipments Starts SF Housing Starts Sold SF Homes Sold 1986 244,660 1,179,400 17.2% 750,000 24.6% 1987 232,598 1,146,

  42. Slide 42: Cost and Size Comparisons for New Manufactured Homes

    Cost and Size Comparisons for New Manufactured Homes and New Single Family Site-Built Homes (1996-2004) 1996 1997 1998 1999 2000 2001 2002 2003 2004 MANUFACTURED HOMES (All Lengths and Widths) Average Sales Price $37,200 $39,800 $41,600 $43,300 $46,400 $48,900 $51,300 $54,900 $58,100 Average Square

  43. Slide 43: Top States for HUD-Code Home Shipments 2004

    Top 10 States for HUD-Code Home Shipments 2004 State Total % of U.S. Total 1. Florida 15,582 11.9% 2. Texas 10,924 8.4% 3. California 10,370 7.9% 4. North Carolina 5,331 4.1% 5. Tennessee 4,725 3.6% 6. Kentucky 4,708 3.6% 7. Louisiana 4,618 3.5% 8. Arizona 4,570 3.5% 9. Georgia 4,393 3.4% 10. Pennsy

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