Ufp Technologies, Inc. · NASDAQ:UFPT
Ufp Technologies — Investor Presentation (November 2018)
39 slides from Ufp Technologies's investor presentation, Nov 13, 2018
Slide 1: Welcome Investors November 14, 2018
Welcome Investors November 14, 2018
Slide 2: Safe Harbor Statement
Nasdaq: (UFPT) Safe Harbor Statement This presentation contains forward - looking information that involves risks and uncertainties, including statements about the Company’s prospects, anticipated advantages the Company expects to realize from its acquisition strategies, the Company’s financial perf
Slide 3: Who We Are
Nasdaq: (UFPT) Who We Are UFP Technologies is an innovative designer and custom converter of foams, plastics, and natural fiber materials. Headquarters: Newburyport, MA Ticker: UFPT Market Cap: $254 Million Share Count: 7.3 Million Annual TTM Revenue: $177 Million Proforma* TTM Annual Revenue: $190
Slide 4: What We Do
Nasdaq: (UFPT) What We Do We combine our: • Materials expertise • Design engineering capabilities • Precision manufacturing capabilities to help our customers develop, improve, manufacture, or safely transport their products.
Slide 5: Materials Expertise
Nasdaq: (UFPT) Materials Expertise
Slide 6: Our Value Proposition: Design engineering
Nasdaq: (UFPT) Our Value Proposition » Design engineering • 90 + members of the Engineering group • Culture of innovation • History of innovation
Slide 7: Our Value Proposition: Precision manufacturing
Nasdaq: (UFPT) Our Value Proposition » Precision manufacturing • 9 factories • 14 clean rooms • 2 design centers • Certified quality systems
Slide 8: Systems and Certifications
Nasdaq: (UFPT) Systems and Certifications ISO 9001 Quality Management ISO 13485 Medical Device FDA Registration ISO 14001 Environmental ISO/TS 16949 Automotive AS9100D Aerospace DDTC & ITAR registered ERP/CRM
Slide 9: Growth Strategy
Nasdaq: (UFPT) Growth Strategy Two - pronged growth strategy: 1) Internal growth: market to our sweet spot 2) Strategic acquisitions
Slide 10: Internal Growth Strategy
Nasdaq: (UFPT) Internal Growth Strategy • Infection prevention • Orthopedic implant packaging • Orthopedic soft braces • Advanced wound care • Sterile packaging • Surgical instrument protection • Biopharma Industrial 5%* Automotive 12% • Interior trim & structural • Acoustic/thermal insulation • Wei
Slide 11: Medical
Nasdaq: (UFPT) Medical $371 Billion Global Medical Device Market with a 5.2% CAGR 1 UFP’s expertise is in component solutions for orthopedics, infection prevention, wound care, and minimally invasive surgery Customers include 24 of the top 28 largest medical device manufacturers in the world 2 UFP D
Slide 12: Medical Product Examples
Nasdaq: (UFPT) Medical Medical Product Examples
Slide 13: Automotive
Nasdaq: (UFPT) Automotive 17 Million Light Vehicles Manufactured in the US 1 UFP innovation in safety, comfort, noise control, and weight reduction leads to solutions that are lighter, stronger, and better able to manage heat, moisture, and sound. Our components are present on many of the world’s le
Slide 14: Automotive Product Examples
Nasdaq: (UFPT) Automotive Automotive Product Examples
Slide 15: Aerospace & Defense
Nasdaq: (UFPT) Aerospace & Defense Aircraft Volumes Expected to Double by 2037 1 While Defense Opportunities Lie in Long - term R&D UFP’s expertise is in comfort & safety components, acoustic insulation, thermal insulation, engine components, uniforms & tactical gear, cases and inserts. UFP Differen
Slide 16: Aerospace & Defense Product Examples
Nasdaq: (UFPT) Aerospace & Defense Aerospace & Defense Product Examples
Slide 17: Aerospace Components
Nasdaq: (UFPT) Aerospace Aerospace Components
Slide 18: Molded Fiber
Nasdaq: (UFPT) Molded Fiber Sustainable Packaging Has Grown to $210B Worldwide Market with Annual Growth Rate of 7.7% Forecast for the Next Decade 1 Molded fiber widely accepted as the go - to environmentally friendly alternative to polymer - based materials. Customers include a wide range of well -
Slide 19: Molded Fiber Product Examples
Nasdaq: (UFPT) Molded Fiber Molded Fiber Product Examples
Slide 20: Acquisitive Strategy
Nasdaq: (UFPT) Acquisitive Strategy Continue to focus on higher - growth, higher - margin medical opportunities that create value » Become more valuable to our customers » Strategic focus – new capability, geography, market penetration, materials, products » Add scale / market share » Look for syner
Slide 21: Acquisition Strategy
Nasdaq: (UFPT) Acquisition Strategy » Very fragmented market • No single company controls a large percentage of the market (UFP is one of the largest players) • 500 + companies (potential targets) • Many owner operators at or near retirement age • Reputation for seamless integration » Economies of s
Slide 22: Dielectrics Acquisition
Nasdaq: (UFPT) Dielectrics Acquisition » Acquired February 1, 2018 » Revenue $43 million » 100% medical » Single location in Chicopee, Massachusetts » Great cultural and strategic fit » Instantly accretive to earnings » Makes UFP more valuable to medical customers
Slide 23: Why Invest?
Nasdaq: (UFPT) Why Invest? Significant market growth opportunities Barriers to entry Strong customer relationships Experienced management team Proven growth strategy Attractive financial metrics
Slide 24: Why is UFP an exciting investment?
Nasdaq: (UFPT) Why is UFP an exciting investment? Significant market growth opportunities » Addressable market is growing • Medical – aging population • Aerospace – safer, lighter aircraft » Universe of specialty materials growing
Slide 25: Barriers to Entry
Nasdaq: (UFPT) Barriers to Entry Engineering Resources • Veteran engineering team for product design and development; more than 90 members of the engineering group Greater Access to Materials • Offers broad array of materials to meet customer needs • 50 + years in business and strong supplier relati
Slide 26: National Footprint
Nasdaq: (UFPT) National Footprint Gain Efficiencies Asset utilization Shared best practices Shared resources 9 Manufacturing Facilities - Over 1 million Square Feet of Space
Slide 27: Management Team
Nasdaq: (UFPT) Management Team R. Jeffrey Bailly – Chairman, CEO & President 30 - year history at the company, beginning as an operations manager in 1988. MBA, CPA. Ronald Lataille – CFO, SVP & Treasurer 20 - year history at the company. CPA. Mitchell Rock – SVP Sales & Marketing 20 - year history a
Slide 28: Creating Shareholder Value
Creating Shareholder Value Proven Growth Strategy
Slide 29: Organic Growth Opportunity
Nasdaq: (UFPT) Organic Growth Opportunity Organic Growth (Target of 5% to 7%) » Focus on higher - growth markets (medical – approx. 60% of revenue and growing) » Expand business with existing customers • Offer complementary products and services • Additional value - add services » Gain market share
Slide 30: Acquisitive Growth Strategy
Nasdaq: (UFPT) Acquisitive Growth Strategy Acquisition Growth (Target of 5% to 7%) Continue to focus on higher - growth, higher - margin medical opportunities that create value » Become more valuable to our customers » Add scale / market share Goal is for acquisitions to be accretive within the firs
Slide 31: Revenue Growth, Margin Expansion & Strong Financial Profile
Revenue Growth, Margin Expansion & Strong Financial Profile FINANCIAL REVIEW y N ‘N
Slide 32: Financial Targets
Nasdaq: (UFPT) Financial Targets 10% - 14% Revenue Growth 11% - 13% Operating Margin 27% - 28% Gross Margin 3 to 5 Year Financial Targets
Slide 33: Sales in Millions
Nasdaq: (UFPT) 0 20 40 60 80 100 120 140 160 180 200 2014 2015 2016 2017* YTD '17 YTD '18 Sales In Millions $ 148 Dielectrics 2017 Revenue $43 million 43 GAAP 2017 Revenue $148 million 26% YTD Growth 10% to 14% Targeted Revenue Growth Internal Growth + Acquisitions * Proforma revenue includes $43 mi
Slide 34: Revenue Mix Shift
Nasdaq: (UFPT) 0 20,000 40,000 60,000 80,000 100,000 120,000 Medical* Consumer Automotive Electronics Industrial Aerospace & Defense 2014 2015 2016 2017* Revenue Mix Shift Pro - forma Revenue Mix Shift 2014 to 2017 Medical Mix Increased from 36% to 60% * Proforma revenue includes $43 million of reve
Slide 35: Gross Profit / Margin
Nasdaq: (UFPT) Gross Profit / Margin Gross Margin Target: 27% to 28% Operating Leverage from Mix Shift + Acquisition Synergies + Efficiencies 27 - 28%Target 10.0% 15.0% 20.0% 25.0% 30.0% 2014 2015 2016 2017 3Q17 3Q18
Slide 36: Adjusted Operating Income
Nasdaq: (UFPT) Adjusted* Operating Income Operating Income Margin Target: 11% to 13% Operating Leverage from Mix Shift + Acquisition Synergies + Efficiencies * Adjusted Operating Income is a non - GAAP term. A reconciliation to GAAP is provided in the Appendix 11 - 13% Target 0.0% 2.0% 4.0% 6.0% 8.0
Slide 37: Growing Book Value
Nasdaq: (UFPT) Growing Book Value Book Value EPS $1.05 $1.05 $1.10 $1.26 $1.34 $10.00 $11.00 $12.00 $13.00 $14.00 $15.00 $16.00 $17.00 $18.00 $19.00 2014 2015 2016 2017 YTD 3Q18 BV/ Share EPS
Slide 38: Thank you
UFP TECHNOLOGIES Thank you
Slide 39: Adjusted Operating Income Non-GAAP to GAAP Reconciliation
Nasdaq: (UFPT) Adjusted Operating Income Non - GAAP to GAAP Operating Income Reconciliation
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