Slide 1: Interface, Inc. Investor Presentation December 2005
I N T E R F A C E Interface, Inc. Investor Presentation December 2005
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements, including, in particular, statements about Interface’s plans, strategies and prospects. These are based on the Company’s current assumptions, expectations and projections about future events. Although Interface believe
Slide 3: Business Overview: Who is Interface?
Business Overview Who is Interface ?
Slide 4: Who is Interface?
Who is Interface? Commercial Market Leader Leader in Innovation & Design Made to Order Approach First Mover in Sustainability The Worldwide Leader In Modular Floorcovering Segmented Approach Focused On ALL Segments Of Floorcovering-The Flooring Of Choice Industry Leader In Innovation And Design Of F
Slide 5: Interface is a Leader in the Commercial Interiors Market
12%65%21%2%12%47%21%1%19%99% Commercial 1% Residential65% Corporate Office 35% Non-Corporate90% Refurbishment 10% New Construction Interface Portfolio Interface is a Leader in the Commercial Interiors Market Commercial Market Leader LTM 2005 Portfolio MixCore Focused Modular Floorcovering Fabrics Sp
Slide 6: Modular Carpet will Become the Floor Covering of Choice
Modular Carpet will Become the Floor Covering of Choice Interface U.S. Market Opportunity Expansion Commercial Market Leader Segmented Approach Made to Order Approac First Mover Sustainability MARKET SIZECURRENT MODULAR PENETRATION50%0%$1.7B$22B$14BSpecified Corporate Office Segment Non-Corporate Sp
Slide 7: Interface Continues to be the First to Market with Products Recognized for Innovation and Design
Interface Continues to be the FIRST to Market with Products Recognized for Innovation and Design SERVICE QUALITY DESIGN PERFORMANCE VALUE1. INTERFACE 1. INTERFACE 1. INTERFACE 1. INTERFACE 1. INTERFACE SHAW CONTRACT2. BPS2. BPS2. LEES SHAW2. BENTLEY PRINCE3. SHAW CONTRACT SHAW3. BPS2. LEES STREET (B
Slide 8: Strong Competitive Advantage Through Made to Order Philosophy
Interface Maintains a Strong Competitive Advantage Through its Made to Order Philosophy INVENTORY TURNS% MADE TO ORDER Americas Modular1120%100%Asia Pacific Modular Europe Modular Fabrics Americas Broadloom1.Increases speed to market2.Offers unique customer service capabilities3.Supports a constant
Slide 9: Interface Continues to be Recognized as the Leader in Sustainability
Interface Continues to be Recognized as the Leader in Sustainability Interface Flooring once again got the most praise for its green efforts, while Mannington and the recycled rubber flooring product Eco Surfaces also received considerable praise.1. INTERFACE'S CARPET TILES/NEW STANDARD GLASBACK WIT
Slide 10: Poised for Growth: 2003 through LTM 2005 Review
Poised for Growth …2003 through LTM 2005 Review
Slide 11: In 2003 Interface Began to Build a Foundation for Future Growth
2005 LTM Operating Income Up 22% vs. YE 20042005 LTM Sales Growth of 9 % vs. YE 2004In 2003 Interface Began to Build a Foundation for Future Growth …Execution has Been the Key to Our Success Leading the Acceptance of Modular Carpet Decreased Dependence on the Corporate Office Market Significantly Im
Slide 12: Execution and Innovation Have Been the Keys to Success
Execution and Innovation Have Been the Keys to Success Divested Re:Source Americas (15 Owned Dealers)Re-financed $135M Senior-Subs Developed and Launched I2 campaign (Random Products)Launched Interface Flor (Residential Business)Developed recycled backing for carpet tile (GlasBacRE)Began $25M Cost C
Slide 13: The Marketplace, Strategy and Interface Have Momentum
The Marketplace Has Momentum …The Strategy Has Momentum …Interface Has Momentum Corporate office market in the U.S. continues to improve. Modular carpet is taking a greater share of the commercial space Interface is leading and shaping the worldwide modular market through best-in-class product devel
Slide 14: The Industry is Off from Historical Highs, but Shows Signs of a Recovery
-40%-30%-20%-10% 0% 10% 20% 30%The Industry is Off from Historical Highs, but Shows Signs of a Recovery BIFMA Orders Year over Year Change %Growth for the year in 2005 is forecasted to be 9.2% vs. 2004 2006 expectations are for an additional 8% year over year 7000 8000 9000 10000 11000 12000 13000 1
Slide 15: Interface Showed Considerable Gains Despite a Sluggish Corporate Office Market
$876 $745 $767 $881 $958 $0 $200 $400 $600 $800 $1,000 $1,200 2001 2002 2003 2004 LTM Q3 2005Interface Showed Considerable Gains, Despite a Sluggish Corporate Office Market …Segmentation is Driving Growth US $(000’s)Growth occurred through the execution of Interface’s Strategic Platforms Corporate O
Slide 16: Interface Modular Net Sales and Operating Profit Margin
$484 $442 $473 $563 $627 0 100 200 300 400 500 600 700 2001 2002 2003 2004 LTM Q3 2005 0% 5% 10% 15% 20% Interface Modular Net Sales and Operating Profit Margin 2001 -2005 Interface is the Worldwide Leader in the Design and Manufacture of Carpet Tiles -The Flooring of Choice$ in Millions% Operating
Slide 17: Bentley Prince Street has Returned to Profitability
$141 $115 $110 $119 $121 0 20 40 60 80 100 120 140 160 2001 2002 2003 2004 LTM Q3 2005 -15% -10% -5% 0% 5% 10% 15% 20% Bentley Prince Street has Returned to Profitability …Poised to Take Advantage of the Corporate Office Rebound Bentley Prince Street Net Sales and Operating Profit Margin2001 -2005 $
Slide 18: Interface Fabrics has Returned to Profitability
Interface Fabrics has Returned to Profitability Despite the Unprecedented Decline in the Commercial Office Furniture Market Interface Fabrics Net Sales and Operating Profit Margin 2001 -2005 $ in Millions Fabrics Operating Profit % Actual Fabrics Net Sales % Operating Profit Margin $209 $173 $173 $1
Slide 19: The Path Forward: Roadmap for Growth
The Path Forward …Roadmap for Growth
Slide 20: Tenets for Success
Tenets for Success • Broaden our Market Focus-We will become the “Flooring of Choice” • Continue to Lead with Fashion and Design while increasing speed to market • Increase the Focus on the Architect and Design Community as they increase their influence across all market segments • Capitalize on our
Slide 21: Interface Has Made the Turn: More Growth Opportunity Still Exists
4.52 4.93 1.46 0.77 4.25 4.62 2.4 6.2 $0 $40 $80 2001 2002 2003 2004 LTM Q3 2005 Interface Has Made the Turn …More Growth Opportunity Still Exists Interface EBIT2000 -LTM 2005(Including Restructuring Charges)$ 59.1 $ 47.3 $ 37.6 $ 60.7 (000’s) $ 74.2 Restructuring Charges EBIT; Earnings before Inter
Slide 22: Why is the Time Right to Invest in Interface?
Why is the Time Right to Invest in Interface? The U.S. office market is beginning to rebound-Indications are that we are in the early days (second year) of the recovery with tremendous pent-up demand, which should create a robust office market Carpet Tile is reaching the “Tipping Point” in the comme
Slide 23: We Don't Know How Far Modular Can Go
We Don’t Know How Far Modular Can Go …