Dixie Group, Inc. · OTC:DXYN
Dixie — Investor Presentation (August 2021)
27 slides from Dixie's investor presentation, Aug 5, 2021
Slide 1: August 2021 Investor Presentation
August 2021 Investor Presentation Contact: Allen Danzey CFO The Dixie Group Phone: 706-876-5865 allen.danzey@dixiegroup.com Exhibit 99.1
Slide 2: Forward Looking Statements
Forward Looking Statements The Dixie Group, Inc. • Statements in this presentation which relate to the future, are subject to risk factors and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements. Such factors include the levels o
Slide 3: Dixie History
Dixie History • 1920 Began as Dixie Mercerizing in Chattanooga, TN • 1990’s Transitioned from textiles to floorcovering • 2003 Refined focus on upper- end floorcovering market • 2003 Launched Dixie Home - upper end residential line • 2005 Launched modular tile carpet line – new product category • 20
Slide 4: Dixie Today
Dixie Today • Commitment to brands in the upper- end market with strong growth potential. • Diversified between Commercial and Residential markets. • Diversified customer base (TTM Basis) – Top 10 carpet customers • 13% of sales – Top 100 carpet customers • 28% of sales 4
Slide 5: Dixie Group Business Drivers
5 Dixie Group Business Drivers • Residentially • The flooring market is driven by residential remodeling activity, existing home sales and new construction of single family and multifamily housing. • Our residential business plays primarily in the mid to high end residential replacement segment, dep
Slide 6: New and Existing Home Sales
New and Existing Home Sales Seasonally Adjusted Annual Rate 6 New 1,000 Existing 1,000 Source: National Association of Realtors (existing) and census.gov/newhomesales 3,500 4,000 4,500 5,000 5,500 6,000 6,500 7,000 300 350 400 450 500 550 600 650 700 750 800 850 900 950 1,000 1,050 Jan '13 Jan '14 J
Slide 7: Remodeling Activity
Remodeling Activity OS THE DIXIB GROUP Leading Indicator of Remodeling Activity - Second Quarter 2021 Homeowner Improvements & Repairs Four-Quarter Moving Totals Four-Quarter Moving Billions Rate of Change $450 | 8.5% 8.6% - 10% 6.3% ect 76% 6.7% 48% 400 3.4% 3.1% 3.0% p 5% 4.4% 1.9% $350 0% $300 |
Slide 8: 2020 U.S. Flooring Manufacturers
2020 U.S. Flooring Manufacturers 8 Source: Floor Focus - Flooring includes sales of carpet, rugs, ceramic floor tile, wood, laminate, resilient and rubber Flooring Manufacturers Flooring $ in millions Flooring Market % Mohawk (MHK) 5,540 25.1% Shaw (Berkshire Hathaway) 5,500 24.9% Engineered Floors
Slide 9: Dixie versus the Industry
Dixie versus the Industry 2021 Second Quarter TTM U.S. Carpet & Rug Market 9 Source: Floor Covering Weekly and Dixie Group estimate TTM: Trailing Twelve Months 2021 Second Quarter TTM Dixie sales High End Commercial, 14% High End Residential, 86% Commercial, 35% Residential, 65%
Slide 10: Industry Positioning
Industry Positioning The Dixie Group • Strategically our residential and commercial businesses are driven by our relationship to the upper-end consumer and the design community • This leads us to: – Have a sales force that is attuned to design and customer solutions – Be a “product driven company” w
Slide 11: High-End Residential Sales by Brand
Dixie Group High-End Residential Sales All Residential Brands Masland Dixie Home Fabrica TRUCOR Sales by Brand for Q2 2021 (TTM) 11
Slide 12: High-End Residential Sales by Channel
Dixie Group High-End Residential Sales All Brands Retailer Designer Mass Merchant Builder Commercial Specialty - OEM 12 Sales by Channel for Q2 2021 (TTM) The company believes that a significant portion of retail sales also involve a designer.
Slide 13: Residential Business
Residential Business • Residential represents 86% of TDG sales today • Doubled our market share of carpet in the past 10 years, aided by an upper end segment that outpaced the market • Successfully entered the hard surface market in the rigid core and engineered wood segments 13
Slide 14: Dixie Home
• Affordable Fashion: Dixie Home provides well styled carpet and hard surface designs in the mid to high end residential market. • With a broad range of price points, Dixie Home meets the needs of a variety of consumers through specialty retailers and mass merchants. • Growth initiatives – TRUCOR™ S
Slide 15: Masland
• Leading high-end brand with reputation for innovative styling, design and color • High-end retail / designer driven – Approximately 23% of sales directly involve a designer – Hand crafted and imported rugs • Growth initiatives – TRUCOR Prime™ WPC Luxury Vinyl Flooring & – TRUCOR™ Energy SPC floori
Slide 16: Fabrica
• Premium high-end brand – “Quality without Compromise” • Designer focused – Approximately 28% of sales directly involve a designer – Hand crafted and imported rugs • Growth initiatives – Fabrica Fine Wood Flooring, a sophisticated collection of refined wood flooring – EnVision 6,6™ nylon – Luxury w
Slide 17: Commercial Market Positioning
Commercial Market Positioning The Dixie Group • We focus on the “high-end specified soft floorcovering contract market” • Our AtlasMasland products – Designer driven focused on the fashion oriented market space – Broad product line for diverse commercial markets • Our Masland eNergy products – Sells
Slide 18: AtlasMasland commercial brand
• Upper-end brand in the specified commercial marketplace – Corporate, End User, Store Planning, Hospitality, Health Care, Government and Education markets • Designer focused • Strong national account base • Growth initiatives – Sustaina™ cushion modular carpet backing with the ability to install in
Slide 19: Commercial Sales by Channel
Hospitality Education Store Planning Gov't Health Care Other 19 Sales by Channel for Q2 2021 (TTM) Channels: Interior Design Specifier and Commercial End User
Slide 20: Dixie Group Sales
Dixie Group Sales $ in millions 20 331 321 283 205 231 270 266 345 407 422 397 412 405 375 316 366 0 50 100 150 200 250 300 350 400 450 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 TTM 2021 Net Sales *2016 had 53 weeks.
Slide 21: Sales & Operating Income
Sales & Operating Income $ in millions 21Note: Non-GAAP reconciliation starting on slide 32 Annual FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 TTM 2021 Net Sales 344 407 422 397 412 405 375 316 366 Net Income (Loss) 5.3 (1.4) (2.4) (5.3) (9.6) (21.4) 15.3 (9.2) 1.9 Operating Inco
Slide 22: Current Business Conditions
Current Business Conditions Outlook: • During the second quarter of 2021, our net sales increased 72.3% compared with the second quarter of 2020 • Net income for second quarter was $3.3 million and the year to date income was $1.3 million • Borrowing availability of $40.2 million under our Senior Re
Slide 23: Inspired by Design
INSPIRED BY DESIGN. DIXIE HOMEPe RY A THE DIXTE GROUP
Slide 24: Non-GAAP Information
Non-GAAP Information 24 Use of Non-GAAP Financial Information: The Company believes that non-GAAP performance measures, which management uses in evaluating the Company's business, may provide users of the Company's financial information with additional meaningful bases for comparing the Company's cu
Slide 25: Non-GAAP Gross Profit
Non-GAAP Information 25 Non-GAAP Gross Profit Q2 2018 Q3 2018 Q4 2018 Q12019 Q22019 Q32019 Q42019 Q12020 Q22020 Q32020 Q42020 Q12021 Q22021 Net Sales 106,438 101,562 98,175 88,606 100,394 95,447 90,134 80,578 60,824 85,920 88,618 86,301 104,833 Gross Profit 25,144 21,887 18,380 18,919 23,493 21,074
Slide 26: Non-GAAP Operating Income
26 Non-GAAP Operating Income Q2 2018 Q3 2018 Q4 2018 Q12019 Q22019 Q32019 Q42019 Q12020 Q22020 Q32020 Q42020 Q12021 Q22021 Net Sales 106,438 101,562 98,175 88,606 100,394 95,447 90,134 80,578 60,824 85,920 88,618 86,301 104,833 Operating income (loss) (165) (1,179) (12,765) (4,863) 574 (1,042) 26,68
Slide 27: Non-GAAP EBIT and EBITDA
27 Non-GAAP EBIT and EBITDA Q2 2018 Q3 2018 Q4 2018 Q12019 Q22019 Q32019 Q42019 Q12020 Q22020 Q32020 Q42020 Q12021 Q22021 Net income (loss) as reported (1,815) (2,962) (13,699) (6,672) (1,216) (2,554) 25,712 (2,689) (7,060) 860 (318) (2,028) 3,349 Less: (Loss) from discontinued, net tax 157 (40) 1 (