Monro, Inc. · NASDAQ:MNRO
Monro — Investor Presentation (October 2012)
22 slides from Monro's investor presentation, October 2012
Slide 1: Nasdaq: MNRO Updated October 2012
Updated October 2012 Nasdaq: MNRO 1
Slide 2: Forward Looking Information
Forward Looking Information Statements contained in these materials regarding Monro’s expectations with respect to future operations and other information, which can be identified by the use of forward looking terminology, such as “may,” “will,” “expect,” “project,” “anticipate,” “estimate” or “cont
Slide 3: Who We Are
Who We Are (MenEe) il AUTOTIRE |
Slide 4: Company Overview
Company Overview • Largest chain of Company-operated undercar care facilities in the United States • As of September 29, 2012, the Company operated 853 stores in 20 states 4
Slide 5: Geographic Presence
Geographic Presence Service Stores Connecticut 36 MAINTAINING DOMINANCE Delaware 2 Indiana 8 IN THE NORTHEASTERN U.S Maine 2 16 Maryland 14 Massachusetts 43 5 New Hampshire 11 New Jersey 15 New York 128 26 North Carolina 11 135 Ohio 117 52 Pennsylvania 115 Rhode Island 9 36 12 South Carolina 1 Vermo
Slide 6: Service Mix
Service Mix Gross Margin % FY11 Brakes and Steering = +15 Maintenance and Exhaust = baseline company margin Tires = -20 FY12 FY13 Q2 Brakes Exhaust Steering Maintenance* Tires *Includes state inspections, lube, oil, filter, engine cooling service, scheduled maintenance and other. Note: Monro’s fisca
Slide 7: Competitive Advantages: Operating Model
Competitive Advantages Operating Model • Company-operated stores – Faster, Better, Cheaper – Centralized purchasing and distribution – Efficient marketing (database mailing, email, direct mail and internet) – Superior customer service • Pricing power and fixed cost leverage – Low cost operator 7
Slide 8: Competitive Advantages: Customer Value Proposition
Competitive Advantages Customer Value Proposition • Monro establishes relationships with customers based on TRUST • Direct marketing to customers fosters repeat business and long-term relationships • Company-operated store model enhances customer experience through: – High standards of customer care
Slide 9: Industry Overview
Industry Overview Monro operates in $158 billion “Do-It-For-Me” segment of $202 billion U.S. automotive aftermarket industry U.S. Automotive Service Bay Population Aftermarket Industry Changes: 1999 – 2010 Total Bays / Mkt Share % Do-It-For-Me: (000’s) 1999 - 74.3% 2010 2008 2009 - 78.0% 350/29.6 33
Slide 10: Vehicle Age
Vehicle Age The rising average age of vehicles may shift consumer spending from new cars to aftermarket parts and maintenance. For about 55% of U.S. drivers, ``the sky is the limit'' for the mileage they plan to put on their primary vehicle, according to an AutoMD.com survey. Longer ownership cycles
Slide 11: Favorable Industry Trends
Favorable Industry Trends Weak new car sales Approximately 240 million vehicles on road Increasing age of vehicles Number of vehicles age 4 - 12 years old increasing Significant average annual miles driven per vehicle Decreasing number of service outlets and bays Dealer consolidation a
Slide 12: Favorable Industry Trends: Vehicles and Sales
Favorable Industry Trends Cars and Light Trucks in Service Average Age of Car and Light Truck on the Road Number of Vehicles (in Millions) Age (in years) Source: APAA Aftermarket Factbook and Lang Report. Source: April 2010 Lang Report and 2012 Wall Street Journal. U.S. Annual Light Vehicle Sales Ve
Slide 13: EPS Trends
EPS Trends $1.75 $1.50 $1.69 $1.25 Est. $1.36 - $1.50 $1.44 $1.00 $1.07 $0.75 $0.80 $0.50 $0.67 $0.65 $0.67 $0.60 $0.51 $0.42 $0.36 $0.25 $0.31 $0.25 $0.09 $0.00 ’99 '01 ’00 '02 ’01 '03 ’02 '04 ’03 '05 ’04 '06 ’05 '07 ’06 '08 ’07 '09 ’08 '10 ’09 '11 ’10 '12 ’11 '13 ’12 '14 ‘13 '15 % Change (70)% 178
Slide 14: Historical Financials
Historical Financials (Dollars in millions except per share data) 2nd Quarter 2nd Quarter Fiscal Year Fiscal Year Fiscal Year 2013 2012 2012 2011 2010 Sales $176.5 $173.3 $686.6 $636.7 $564.6 Sales Growth (vs. prior year) 1.9% 6.9% 7.8% 12.8% 18.6% EBITDA $ 24.9 $ 31.2 $115.5 $101.4 $ 81.8 EBITDA Ma
Slide 15: Balance Sheet Highlights
Balance Sheet Highlights Fiscal Y/E Fiscal Y/E September 29, March 31, 2012 2012 Current assets $151,999 $ 134,300 Property, plant & equipment 216,987 212,994 Other 206,525 162,798 Total Assets $575,511 $ 510,092 Current liabilities $113,134 $ 109,794 Capital Lease Obligations 44,415 45,504 Other Lo
Slide 16: Growth Strategy
Growth Strategy Increase market share through same store sales growth Acquire competitors cheaply Continue new store openings in existing markets – Approximately six stores per year 16
Slide 17: Acquisitions and Opportunities
Acquisitions and Opportunities Building Tire Store Category Combination of 20 acquisitions in the last 11 years - 355 stores - $388 million revenue Could have up to 1,200 tire stores and 1,200 service stores in our 20 states - Creates market dominance and pricing power - Diversifies risk - Expan
Slide 18: Acquisitions and Opportunities
Acquisitions and Opportunities Autotire Car Care Centers (June 2009) Terry’s Tire Town (October 2011) • 26 tire stores in St. Louis, Missouri • 7 stores in Ohio and Pennsylvania • 2008 sales - $31million • 2010 sales - $9 million • Slightly accretive in fiscal 2012 Midwest Tire (September 2009) • 4
Slide 19: FY13 Earnings Assumptions
FY13 Earnings Assumptions • Earnings estimate for FY13: $1.36 - $1.50 vs $1.69 in FY12 – Q1 – FY13: $.36 vs. $.48 Q1 FY12 – Q2 – FY13: $.36 vs. $.47 Q2 FY12 – Q3 – FY13: $.35 - $.40 vs. $.42 Q3 FY12 • Comparable Store Sales decrease of (3.5)% to (2.0)%, adjusted for days for FY13; Q3 FY13: (3)% - 0%
Slide 20: FY13 Other Assumptions
FY13 Other Assumptions • Interest Expense of $5.1 million • $26 million depreciation and amortization • $25 million of Cap-ex – $19 million in maintenance cap-ex – $5 million for new stores – $1 million for headquarters expansion • EBITDA approximately $108 million 20
Slide 21: FY13 Cash Flow Priorities
FY13 Cash Flow Priorities Acquisitions Same or contiguous markets Buy right Accretive to earnings in a reasonable timeframe Pay down debt 21
Slide 22: Investment Highlights
Investment Highlights Largest chain of Company-operated undercar care facilities in the U.S. Wide breadth of product and service offerings Superior customer service Favorable industry trends Leading market position in northeast, Great Lakes and mid-Atlantic with a presence in 20 states S