Prestige Consumer Healthcare Inc. · NYSE:PBH
Prestige Consumer Healthcare — Prestige Brands Holdings — Investor Presentation (February 2006)
24 slides from Prestige Consumer Healthcare's investor presentation, Feb 27, 2006
Slide 1: Prestige Brands Holdings, Inc.
NYSE: PBH Holdings Inc.
Slide 2: Forward Looking Statement
Welcome Forward Looking Statement Statements in this presentation which are not historical facts, including, without limitation, reporting financial guidance for fiscal 2006 and fiscal 2007, are forward-looking statements within the meaning of the Securities Litigation Reform Act of 1995. These forw
Slide 3: Company Highlights
• Competes in OTC, household and personal care segments • Uniquely strong and diversified brand portfolio with many brands having #1 or #2 market positions • Focus on smaller, less competitive “niche” categories and segments • Marketing and sales driven with particular focus on line and brand extens
Slide 4: Our Strong Portfolio of Brands
(1) Rankings based on brand’s primary category (2) Based on IRI Dollar sales, adjusted for Wal-Mart and Dollar/club store sales OTC PC Household Copper Scrubber Our Strong Portfolio of Brands
Slide 5: Diversified Sales
Latest Months Net Sales: $294mm (a) Other brands include: Cutex, Denorex, Prell, Oxipor, Cloverine, Kerodex, Heet, Momentum, Percogesic, Outgro, Freezone, Mosco, Compoz, EZO, Zincon, and Private Label. Note: Brand %’s are pro forma assuming full year sales of Chore Boy and The Doctor’s. Segment %’s
Slide 6: Focus on Fastest Growing Channels and Customers
Sales By Channel, Nine Months Ended 12/31/05 Top Customers Focus on Fastest Growing Channels and Customers
Slide 7: Proven Ability to Acquire
Year Brand Acquired Revenue at Acquisition $8.0 $40.0 $25.0 $85.0 $51.0 $15.0 $17.0 $14.0 $13.0 ($ in millions) Proven Ability to Acquire
Slide 8: Proven Ability to Grow by Brand Extension
Core Brand Extension Freeze Off, Invisible Strips Strips, Pocket Pal Clear Eyes Dry Eyes, Triple Action Redness, Homeopathic (eye & ear) Twister, Essential Care Pads Scar Therapy Comet Cream, Lavender Powder Sprays, Lavender Colic Poison Ivy Treatment Proven Ability to Grow by Brand Extension
Slide 9: Investment in Brand Equity
Brand Investment as % of Net Sales (1) LTM 12/31/05 Marketing Spend (1) Reported net sales for the twelve months ending 3/31/05 and 12/31/2005. Investment in Brand Equity
Slide 10: Unique Operating Model
Unique Operating Model • Hands-on senior management with 25+ years experience per manager; middle management also deeply experienced • Manufacturing done by large, experienced 3rd parties – P&G, Abbott, Amway, Vijon, Humco. § Competitive industry insures cost efficiency and backup § Cost variable wi
Slide 11: Industry Leading Margins and Capital Efficiency
Industry Leading Margins and Capital Efficiency Note: Prestige as of 12/31/05 and pro forma EBITDA and Free Cash Flow. All other companies are as per most recent annual report filings.
Slide 12: Strong and Consistent Historical Top Line Growth
(1) Assumes acquisitions of Medtech and Denorex (predecessor companies), Bonita Bay and Spic and Span occurred as of 4/1/2001. Bonita Bay and Spic and Span net sales represent previous calendar year results for FY02 through FY03. Pro forma Results Through December 2005 Net Sales (1) ($ in millions)
Slide 13: Strong Organic Growth
($ in millions) 8% 11% -1% 4% Net Sales (1) (1) Assumes acquisitions of Medtech and Denorex (predecessor companies), Bonita Bay and Spic and Span occurred as of 4/1/2001. Bonita Bay and Spic and Span net sales represent previous calendar year results for FY02 through FY03. Pro forma Results Through
Slide 14: Flexible Capital Structure
Capitalization Flexible Capital Structure
Slide 15: Cash Taxes Substantially Below Book Taxes
• Asset acquisitions created $529.5mm deductible tax asset § Amortizable over 15 years PF LTM $ 36.6 Book Pre-Tax Income 15.6 Book Provision for Income Taxes 20.9 Book Net Income 30.1 +9.2 Cash Tax Shield from Incremental Tax Amortization “Cash Net Income” Cash Taxes Substantially Below Book Taxes
Slide 16: Cash Flows Higher Than Basic Net Income
FY TTM 12/31/2005 ($ in millions) Cash Flows Higher Than Basic Net Income
Slide 17: Organic Growth Driven by Product Innovation
Current Examples Comet Cream Murine Homeopathic Compound W Foot Care Kit Little Remedies Colic + New Kit Organic Growth Driven by Product Innovation
Slide 18: International
Canada Other International • New items in existing geography • New geographies • Licensing International
Slide 19: Existing and New Markets
USA, Canada Venezuela Central America South Africa Australia Malaysia Saudi Arabia Lebanon United Kingdom Mexico Singapore Central Eastern Europe and Middle East and Africa Existing Market New Market New Geographies
Slide 20: Acquisition Criteria
Acquisition Criteria • OTC or household categories – bias towards OTC • Must be growable • Accretive in year 1 • National distribution • Consumer awareness • Revenues $15m -$100m • Valuation based on pro-forma trailing numbers § Pro-forma reflects synergies, proper A&P levels, etc
Slide 21: Model and Outlook
Model and Outlook • Long Term Business Outlook § Continued organic revenue growth from: • Market share gains • Line extension and new category expansion • Geographic expansion § Modest operating margin improvement § De-leveraging § Strategic Acquisitions
Slide 22: What Does This Mean for the March 2006 Quarter?
What Does This Mean for the March 2006 Quarter? • We expect to post a mid-single digit revenue increase with both net income and EPS growing more rapidly • We expect free cash flow higher than reported net book income
Slide 23: Looking Ahead to FY '07
Looking Ahead to FY ’07 • We expect total revenues to grow in the high single digits, with organic growth contributing to that overall • We expect net income growth in excess of revenue growth as a result of deleveraging and modest operating profit margin improvement • We expect FCF to be better tha
Slide 24: Thank You
NYSE: PBH THANK YOU Holdings Inc.
Prestige Brands Holdings — Investor Presentation (February 2006) on 6ix