5,300 employees Voluntary employee ownership until 1994 Listed on NASDAQ MATW July 1994; $3.50/share (split-adjusted) 28.4 million shares outstanding

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Berniece Blankenship
5 years ago
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1 9/30/11

2 Business Overview 2

Disclaimer Any forward-looking statements in connection with this discussion are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

3 Disclaimer Any forward-looking statements in connection with this discussion are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of Such forward-looking statements involve known and unknown risks and uncertainties that may cause the Company s actual results in future periods to be materially different from management s expectations. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove correct. Factors that could cause the Company s results to differ from those discussed today are set forth in the Company s Annual Report on Form 10-K and other periodic filings with the Securities and Exchange Commission ( SEC ). 3

4 Founded in 1850 headquartered in Pittsburgh, PA Two principal business lines: Memorialization products and services Bronze Casket Cremation Brand Solutions Graphics Imaging Group Marking Products Merchandising Solutions 5,300 employees Voluntary employee ownership until 1994 Listed on NASDAQ MATW July 1994; $3.50/share (split-adjusted) 28.4 million shares outstanding 4

5 FISCAL 2011 SALES Memorialization 56% Brand Solutions 44% Memorialization: Bronze 25% Casket 26% Cremation 5% 56% Brand Solutions: Graphics Imaging 30% Marking Products 7% Merchandising Solutions 7% 44% 5

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7 The Regal Rose Memorial is one of many styles of flush bronze memorials produced by Matthews Building signs are an example of the segment s architectural product offerings. Lasting Memories TM products illustrate photographs cast in a bronze memorial or urn. Cremation gardens can be designed to include bronze and granite products. 7

8 The Casket segment is a leading manufacturer and distributor of caskets in North America, producing a wide variety of wood, metal and cremation caskets. Wood Caskets are manufactured in York, PA 8

popular cremation systems in North America.

assists funeral directors in educating the

9 The Power Pak II cremation system with automatic casket loader, one of the most popular cremation systems in North America. Bio-cremation is a water-based (versus flame-based) cremation process. The Master Touch cremation arrangement center assists funeral directors in educating the cremation consumer in the options available to them in services, merchandise and memorialization. 9

10 Total Solutions to funeral service providers Cremation Memorialization European market Service Granite memorials Architectural products/signage Acquisitions Cost structure improvements 10

11 26.2% 32.3% 39.8% 46.0% 58.9% 60.6% 62.3% 64.0% 65.0% 66.0% ,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 Source: CANA Total Deaths 50.0% Cremation Rate 11

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Graphics Imaging offers a wide range of services to the

Graphics Imaging segment s principal product lines.

13 Graphics Imaging offers a wide range of services to the corrugated and flexible packaging industries, including creative graphic design. Printing plates for the packaging industry are one of the Graphics Imaging segment s principal product lines. Saueressig is a manufacturer of gravure printing and embossing tools used in the packaging, wallpaper and tobacco industries. 13

The Marking Products segment designs and

14 The Marking Products segment designs and manufactures industrial quality printers for in-line marking. The ProPoint printer uses an etching process to mark items. Matthews continues to be one of the market leaders in automated conveyor controls. Non-contact ink-jet printing units apply dot matrix coding on products. Marking Products manufactures industrial inks for offset, contact and ink-jet printing systems. 14

15 The Merchandising Solutions segment provides value-added comprehensive merchandising solutions to consumer products marketers and retailers. 15

16 U.S. Graphics Primary packaging Gravure Skill extension Geographic expansion New product development Acquisitions Cost structure improvements 16

17 FINANCIAL OVERVIEW 17

18 Internal Growth Expand market presence of existing products New product development Manufacturing/cost structure improvements Acquisitions Share Repurchases 18

19 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Currency changes, 1.3% Share repurchases, 1.3% Acquisitions, 4.7% Organic Growth, 3.6% 10.9% 19

20 Principal objective: Financial criteria: Support the business plan and long-term growth objectives of the Company and specific operating segment. Immediately accretive to Earnings per Share. Achieve long-term target of an annual pre-tax Return on Invested Capital of 20%. Performance of companies acquired within last 10 years: Strong Performers Acceptable Performers Marginal Performers FCC Casket Distributors Cloverleaf (reduced cost structure) Holjeron Gem Doyle Group (reduced cost structure) IPTI / Lightning Pick InTouch United Memorial (granite business plan) Munich Saueressig York Bronze Kenuohua Milso Reynoldsville Casket York Casket 20

21 (Dollars in thousands, except per share data) Fiscal year ended September 30, Sales $818,623 $780,908 $821,829 $898,821 % Change 9.2% -4.6% 5.2% 9.4% Operating Profit $132,952 $101,011 (b) $116,581 $118,516 % Change 18.9% -24.0% 15.4% 1.7% Net Income $79,484 (a) $57,732 (b) $69,057 (d) $72,372 (d) % Change 22.8% -27.4% 19.6% 4.8% EPS $2.55 (a) $1.90 (b) $2.31 (d) $2.46 (d) % Change 25.0% -25.5% 21.6% 6.5% (a) Includes net favorable $0.06 per share impact of an unusual income tax benefit. (b) Includes net unfavorable $0.31 per share impact of unusual items. (c) Includes net favorable $0.03 per share impact of an unusual income tax benefit. (d) Includes net favorable $0.02 per share impact of an unusual income tax benefit. 21

22 (Dollars in thousands) Fiscal year ended September 30, Memorialization: Bronze $243,063 $215,934 $224,247 $224,773 Casket 219, , , ,753 Cremation 26,665 30,909 39,356 43,816 Total Memorialization 489, , , ,342 Brand Solutions: Graphics Imaging 203, , , ,975 Marking Products 60,031 42,355 51,069 61,938 Merchandising Solutions 65,369 53,497 56,921 60,566 Total Brand Solutions 329, , , ,479 Total $818,623 $780,908 $821,829 $898,821 22

23 (Dollars in thousands) Fiscal year ended September 30, Memorialization: Bronze $71,576 $57,598 $56,167 $52,474 Casket 23,339 17,716 26,242 26,785 Cremation 5,474 5,036 4,910 5,733 Total Memorialization 100,389 80,350 87,319 84,992 Brand Solutions: Graphics Imaging 18,617 19,217 21,077 22,427 Marking Products 9,137 1,500 5,817 7,819 Merchandising Solutions 4,809 (56) 2,368 3,278 Total Brand Solutions 32,563 20,661 29,262 33,524 Total $132,952 $101,011 $116,581 $118,516 23

24 Fiscal year ended September 30, Memorialization: Bronze 28.8% 29.4% 26.7% 25.0% 23.3% Casket 5.6% 10.6% 8.7% 12.5% 11.2% Cremation 14.4% 20.5% 16.3% 12.5% 13.1% Total Memorialization 17.6% 20.5% 17.9% 18.4% 16.8% Brand Solutions: Graphics Imaging 9.9% 9.1% 8.2% 8.8% 8.3% Marking Products 17.3% 15.2% 3.5% 11.4% 12.6% Merchandising Solutions 7.1% 7.4% -0.1% 4.2% 5.4% Total Brand Solutions 10.6% 9.9% 6.2% 8.4% 8.6% Total 14.9% 16.2% 12.9% 14.2% 13.2% 24

25 Fiscal 2011 (in thousands) Net Income $72,372 Depreciation and Amortization 27,661 Stock-Based Compensation 6, ,005 Capital Expenditures (22,440) Free Cash Flow $84,565 25

26 12% 10% 9.7% 8% 6% 5.3% 5.9% 5.7% 4.4% 6.2% 5.0% 6.2% 6.9% 7.8% 4% 2% 0% 9/30/02 9/30/03 9/30/04 9/30/05 9/30/06 9/30/07 9/30/08 9/30/09 9/30/10 9/30/11 26

$3.00 $2.50 $2.55 $2.31 $2.46 $2.00 $1.50 $1.16 $1.35 $1.68 $1.79 $2.06 $2.04 $1.

27 $3.00 $2.50 $2.55 $2.31 $2.46 $2.00 $1.50 $1.16 $1.35 $1.68 $1.79 $2.06 $2.04 $ year average annual increase in EPS 10.9%. $1.00 $0.50 $

28 $3.50 $3.12 $3.00 $2.73 $2.88 $2.50 $2.24 $2.15 $2.45 $2.00 $1.56 $1.92 $1.63 $1.50 $1.22 $1.00 $0.50 $

29 $4.00 $3.58 $3.50 $3.00 $2.50 $2.00 $1.74 $1.81 $2.53 $2.17 $2.05 $2.35 $3.36 $3.00 $3.25 $1.50 $1.00 $0.50 $

30 $60 $50 $43.80 $50.74 $40 $33.88 $37.80 $36.79 $35.38 $35.36 $30.73 $30 $26.42 $23.37 $20 $10 $0 9/30/02 9/30/03 9/30/04 9/30/05 9/30/06 9/30/07 9/30/08 9/30/09 9/30/10 9/30/11 30

31 25% 20% 15% 15.8% 18.3% 13.2% 14.8% 15.0% 10% 5% 0%

32 Increased quarterly dividend 12.5% to 9.0 cents (October 2011) 17 th consecutive annual dividend increase since the IPO Reported record sales of $899 million in fiscal 2011 Sales of $339 million (38% of total) generated outside the U.S. in fiscal 2011 Analyst coverage: CJS Securities (D. Moore) Davenport & Company (C. Fendley) Great Lakes Review (E. Schlang/G. Halter) Janney Montgomery Scott (L. Burke) Sidoti & Company (J. Clement) 32

33 Shares 9/30/2011 Neuberger Berman LLC 2,053,393 Artisan Partners LP 1,981,442 BlackRock Fund Advisors 1,790,284 Vanguard Group, Inc. 1,589,497 Fidelity Management & Research Co. 1,546,701 Wellington Management Co. LLP 1,200,008 State Street Global Advisors 936,181 T. Rowe Price Associates, Inc. 922,760 Robecco Investment Management 819,364 Lazard Asset Management 577,853 Top Ten Institutions 13,417, % of outstanding shares 145 Institutions 8,927,554 Total Institutional Ownership 22,345, % of outstanding shares 33

52-Week High Low (09/30/11) Stock Price P/E Carriage Services (CSV) $ 6.57 - $ 4.50 $ 5.92 12 Service Corp. (SCI) $ 12.12 - $ 7.86 $ 9.16 16 Stewart Enterprises (STEI) $ 8.39 - $ 5.14 $ 5.

34 52-Week High Low (09/30/11) Stock Price P/E Carriage Services (CSV) $ $ 4.50 $ Service Corp. (SCI) $ $ 7.86 $ Stewart Enterprises (STEI) $ $ 5.14 $ StoneMor Partners LP (STON) $ $23.10 $ N/A Hillenbrand (HI) $ $16.33 $ Schawk, Inc. (SGK) $ $ 9.86 $ Matthews (MATW) $ $28.57 $

35 Long-term track record of EPS growth Strong financial position and consistent free cash flow Ability to support growth strategies, share repurchases and debt reduction Successful acquisition program Additional opportunities exist Strong management team 35

2016 Matthews International Corporation. All Rights Reserved. INVESTOR PRESENTATION 4 th QUARTER FISCAL 2017

2016 Matthews International Corporation. All Rights Reserved. INVESTOR PRESENTATION 4 th QUARTER FISCAL 2017 INVESTOR PRESENTATION 4 th QUARTER FISCAL 2017 Business Overview 2 Disclaimer Any forward-looking statements with respect to Matthews International Corporation (the Company ) in connection with this presentation