Slide 1: Investor Presentation
INTEREACE Investor Presentation December 2004
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
eeS————™—™ Business Overview Interface, Inc. December, 2004 3
Slide 4: Interface Strengths
Interface Strengths Market Leader in Attractive Modular Segments Preeminent Brands — Quality, Reliability and Leadership Sales Force — Established Design Community Relationships Innovative Design and Development Capabilities Made to Order / Low Cost Global Manufacturing Capabilities Strong Free Cash
Slide 5: Market Leader — Where do we Play?
(S) Market Leader— Where do we Play? Interface Market Landscape* 50% 4 Interface Fabtics Zw Europe “nerias = Interface is repositioning to attack the low-end fred : . S 5S Mod#lat commodity market opportunity (BPS™ BE “Agi PSSE ° = . Modular Collection and Heuga® Polypropylene) re Americas ze Broadl
Slide 6: Preeminent Brands — Quality, Reliability, Design
Preeminent Brands — Quality, Reliability, Design = FAVORITE CARPET MANUFACTURERS he competition for favorite manutacturer in each of the five categories below seems to grow more intense every yoar. Not only wore tho votes closer, but 24 different companies or brands were named number one Fortunately
Slide 7: Established Customer Design Relationships Through an Extensive Sales and Marketing Organization
Established Customer Design Relationships Thr h an Extensive Sales and Marketing Organ Business Americas Floorcovering Europe Modular Asia-Pacific Modular Fabrics Total Total Sales & Marketing Personnel Top designers picked Interface brands in four of the five categories in the October 2004 Floor Fo
Slide 8: Innovative Design and Development Capabilities Through Differentiated Made to Order Approach
0) Innovative Design and Development Capabilities Through Our Differentiated Made to Order Business Approach Interface Operational Model The Migrati 100% ” Americas Operations Asia Pacific Modular % Modular 2 1. Increase speed to market fed 2. Decrease lead time to customers 9 Americas. ° Broadioom
Slide 9: High Contribution Model
High Contribution Model Hypothetical Sales Growth Over LTM 2004 LTM 2004 Net Sales $868,000 $943,200 $1,029,600 $1,116,400 Variable Margin 342,600 377,520 411,840 446,160 Fixed Manufacturing 84,600 98,708 98,708 98,708 Gross Profit 268,100 278,813 313,193 347,453 SCRA 199,800 209,790 222,877 299,656
Slide 10: Leader in Sustainability
Leader in Sustainability Industrial Model of a Sustainable Enterprise Interface Seven Fronts (Initiatives) + Zero Waste + Benign Emissions + Renewable Energy + Closed Loop Material Supply + Resource Efficient Transportation Hook Up (Social ity) + Redesign Commerce Interface, Inc. December, 2004 = GR
Slide 11: The Path Forward
Interface, Inc. eeS————™—™ The Path Forward
Slide 12: The Industry is Off Significantly From Historical Highs
The Industry is Off Significantly From Historical Highs ... fad BIFMA Order Trends Unprecedented Decline 0% jdt Md Source: BIFMA, Interface, Inc. December, 2004
Slide 13: Interface is Primed for Growth
® Interface is Primed for Growth Sine. (sae EXECUTE SUSTAINABLE GROWTH ” STAGE 6 «Exploit our position on sustainability «Lead modular opportunity worldwide «Lessen the dependence on the corporate office market through STAGE 1 segmentation «Position the high-end broadloom and fabrics businesses for
Slide 14: The Interface Opportunity
Interface, Grow Corporate Share Execute Market Segmentation Residential Growth Capture Emerging Markets Advance Sustainability The Interface Opportunity The Path Forward will be to Capitalize on These Platforms for Growth Strategic Objective The global office market has been in a prolonged decline a
Slide 15: Focus on Continued Operational Excellence
as Focus on Continued Operational Excellence Strategic Objective The Interface Opportunity = Current Made to Order business has moved Americas Modular to 10 inventory Tighten the turnsiyear Supply Chain + Capitalize on global sourcing opportunities + Continually push supply chain integration across
Slide 16: Interface Growth Platform: Maintain or Grow Corporate Share
Interface Growth Platform Maintain or Grow Corporate Share (Target) $ 1.20B $858M ct 5 Execution Drivers = Maintenance of Interface’s share in Corporate Office Recovery the corporate office market, 10% $ 160M combined with modest 5% growth in Gain the corporate office market itself, will produce res
Slide 17: Maintain or Grow Corporate Share: Modular is Taking Share
0) Maintain or Grow Corporate Share Modular is Taking Share Interface Modular GROWTH in 2004 was 20% - Taking share in a Specified Office Market that is estimated to be UP 8% _» Operating % TARGET of 15% Hot Products Carpet Tile has remained the most often specified product over the last several yea
Slide 18: Broadloom Has Returned to Profitability
0) Maintain or Grow Corporate Share Broadloom Has Returned to Profitability Sin Millions Broadloom Sales and Margin °% Operating Prof Marcin 2007 $183 $180 176 20% 5% 160 stat 10% 140 + [at st17 S19 bo : $110 3% 120 % coe 100 ee 0% — 80 A 5% Operating % 60 “10% TARGET of 8% am 40 é E 0 15% at : é 20
Slide 19: Fabrics Is On The Move
0) Maintain or Grow Corporate Share Fabrics Is On The Move Sin Milons Fabrics Sales and Margin 300 $250 0 $210 200 se $188 $192 150 100 50 o+ 2000 2001 2002 2003 2004 LTM BB Actual Fabrics Sales Interface Fabrics Rationalization Savings = Over $8 million in savings realized in 2003 from rationalizat
Slide 20: Commercial Office Applications
Maintain or Grow Corporate Share Commercial Office Applications
Slide 21: Interface Growth Platform: Execute Market Segmentation
Interface Growth Platform Execute Market Segmentation (Target) $ 1.20B $858M 10% Gain $785.0M Baseline End of Year (2003) Interface, Inc. December, 2004 Non-Office Commercial Market Segmentation $150M Corporate Office Recovery $ 150M Execution Drivers = The Institutional (government and education) a
Slide 22: Aggressive Growth Potential is Projected for Tile in all Segments
Execute Market Segmentation Aggressive Growth Potential is Projected for Tile in all Segments Where are you Specifying Carpet Tile? 2004 2003 The execution of market segmentation will drive the greatest value to our stakeholders Commercial Specified Market Segmentation Opportunity in the U.S apenas
Slide 23: Execute Market Segmentation: Construction Trends
Execute Market Segmentation Educational Buildings Hotels le ‘Mitiions of Square Feet Millions of Square Feet 110 300 250 90 200 70 150 50 100 30 50 10 80 82 84 86 88 90 92 94 96 98 00 02 04 06 80 82 84 86 88 90 92 94 96 98 00 02 04 06 Hotel Constructi Educational Buildings otel Gonstruction 2003 241
Slide 24: Healthcare is Ready for Modular
Execute Market Segmentation althcare is Ready for Modular Ae Interface, Inc. December, 2004
Slide 25: Interface Modular Meets Education's Special Needs
(0) Execute Market Segmentation Interface Modular Meets Education's Special Needs ne = ram Interface, Inc. Decemb
Slide 26: Retail and Service Businesses
Execute Market Segmenta' Retail and Service Bu Interface, Inc. December, 2004
Slide 27: Hospitality Industry - Ideal Candidate For Interface Modular
Execute Market Segmentation Hospitality Industry - Ideal Candidate For Interface Modular Interface, Inc. December, 2004 30
Slide 28: Hospitality - The Hyatt Atlanta
Execute Market Segmentation Hospitality - The Hyatt Atlanta CarpenTile E -~ Common Areas™®
Slide 29: Interface Growth Platform: Expand the Residential Business
Interface Growth Platform Expand the Residential Business (Target) $ 1.20B $858M 10%: Gain| $ 785.0M Baseline End of Year (2003) Interface, Inc. December, 2004 Execution Drivers + US residential carpet market is approximately $11B — current tile penetration is minimal Residential $50M Non-Office Com
Slide 30: 2003 Interface Residential Accomplishments
Expand the Residential Business 2003 Interface Residential Accomplishments INTERFACE FLOR PRINCE STREET HOUSE AND HOME Positive sales trend Growing designer registration Established branded programs with Lowe's, DWR, boutique retail and others The FLOR strategy is influencing the commercial percepti
Slide 31: Expand the Residential Business
® Expand the Residential Business ay. =a _ Lifestyle trends Desire for new Interface, Inc. -December,
Slide 32: Interface Flor Roll-out to Lowe's
Expand the Residential Business Interface Flor Roll-out to Lowe's Homeowners Will Be Abie to Buy Interface Products at Lowe’s Lowe’s for Interface Flor = — InterfaceFlor will be rolled out to over 1,000 stores nationwide. = Atlanta and Los Angeles markets will carry inventory and include advertising
Slide 33: Interface Growth Platform: Capture Emerging Markets
(Target) $ 1.20 $ 785.0M Baseline End of year (2003) Interface Growth Platform Capture Emerging Markets B Emerging Markets $75M Residential $50M Non-Office Commercial Market Segmentation $150M Corporate Office Recovery $ 150M Base Year 2003 Interface, Inc. December, 2004 36 Execution Drivers sales g
Slide 34: Capture Emerging Markets
Capture Emerging Markets HIGH i ra fi = = 8 Middle 4st = Z : India Eagtern Europe Low Low HIGH VALUE OPPORTUNITY (TARGET Sales) Interface, Inc. December, 2004 Eastern Europe 5 (.2mm2) E iddle East Japan Ne a u _(24N/m2) “India China ‘37 (225K m2) (6.5M m2); oo r ¥ i ) !
Slide 35: We Don't Know How Far Modular Can Go...
® We Don’t Know How Far Modular Can Go...