EXHIBIT 99.2
[LOGO OF PATTERSON DENTAL COMPANY] Nasdaq NMS: PDCO
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Expanding Patterson's Growth Opportunities by Entering
the Companion-Pet Veterinarian Supplies Market through
the Acquisition of J.A. Webster, a Leading Full-Service,
Value-Added Distributor
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[LOGO] Forward-Looking Statements
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This presentation contains forward-looking statements as defined in the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are information of a non-historical nature and may be affected
by risks and uncertainties which are inherent in the Company's business
and beyond the ability of the Company to control. Such risks and
uncertainties could cause actual results to differ materially from those
anticipated. Accordingly, these risks are qualified in their entirety by
the cautionary language contained in the Company's filings with the
Securities and Exchange Commission.
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[LOGO] Transaction Overview
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. Patterson acquired assets of J.A. Webster for $92.5 million
|X| $81.8 million paid in cash
|X| $10.7 million paid in stock to three J.A. Webster
shareholders
. Transaction includes earn-out
|X| Subject to minimum revenue hurdles
|X| Five-year term
. Issued shares subject to three-year lock-up
. J.A. Webster senior management team to join Patterson
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[LOGO] Questions to Be Answered
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. What is the opportunity?
. Who is J.A. Webster?
. Why companion-pet veterinarian supplies distribution?
. Why J.A. Webster?
. What is the financial impact on Patterson?
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[LOGO] What Is the Opportunity?
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J.A. Webster expands Patterson's growth opportunities.
. Parallel growth opportunity in large, fragmented market
. Platform for building leading national position
. Excellent strategic fit with Patterson's core competencies in
value-added distribution
|X| Leverage Patterson's existing distribution infrastructure
|X| Consistent cultures
|X| Strong senior management team and high-quality sales force
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[LOGO] Who Is J.A. Webster?
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J.A. Webster is a leading value-added distributor of companion-pet
veterinarian supplies.
. Family-owned business, established in 1946
. Leading distributor of companion-pet veterinarian supplies in New
England, mid-Atlantic states and southeastern U.S.
|X| Estimated 24% market share in regional markets served
|X| Serves over 10,000 animal health clinics in 26 states
|X| Strong brand identity in served markets
. Third largest distributor nationally
|X| 10% national market share
. Top financial performer in industry
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[LOGO] Why Companion-Pet Veterinarian Supplies Distribution?
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The dynamics of the companion-pet veterinarian supplies market are
similar to those of the dental supplies market.
. $2.2 billion market growing at an estimated 6%-7% annually
. Market dynamics similar to dental supplies industry
. Customers value relationships with sales reps that emphasize
quality service
. Fragmented distribution and provider base
. Consolidation opportunities
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[LOGO] Large, Growing Market
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J.A. Webster competes in the $2.2 billion companion-pet veterinarian
supplies & equipment market that is projected to grow at 6% to 7% annually.
Service U.S. Market Growth
. Companion Pet Companion Pet Veterinarian Supplies 6% - 7%
& Equipment - $2.2 Billion
. Companion Pet
. Large Animal (Cattle) Veterinarian Supplies & Equipment - $4 Billion
. Veterinarian Supplies
. Professional Fees
. Surgery Costs Veterinarian Services - $12 Billion
. Lab Costs
. Veterinarian Services
. Pet Food Total Animal Health Expenditures - $23 Billion
. Retail Stores
Source: A.A.H.A., A.V.M.A., KPMG and J.A. Webster management estimates.
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[LOGO] Favorable Industry Characteristics:
Companion-Pet Population: 1996
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The companion-pet market is enormous in terms of number of pets
and household ownership.
(In millions)
Dogs 52.9 31.6% of Households
Cats 59.1 27.3% of Households
Birds 12.6 4.6% of Households
Horses 4.0 1.5% of Households
Source: A.A.H.A., A.V.M.A., KPMG and J.A. Webster management estimates.
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[LOGO] Favorable Industry Characteristics:
Annual Veterinary Expenditures
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Average annual veterinary expenditures have been rising steadily,
reflecting the willingness of owners to spend more on their pets.
(Per Household) Cats Dogs
1991 $ 80 $ 132
1996 $ 148 $ 187
2001E $ 250 $ 300
Source: A.A.H.A., A.V.M.A., KPMG and J.A. Webster management estimates.
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[LOGO] Favorable Industry Characteristics:
Veterinarians by Segment
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Small-animal veterinarians constitute the largest and
fastest-growing segment of the overall veterinarian market.
(In Thousands)
1997 2000 2005E 2010E 2015E
Total 51.6 53.2 56.6 60.5 64.8
Large Animal 11.7 11.7 12.0 12.0 12.1
Small Animal 39.9 41.4 44.7 48.4 52.7
Source: A.A.H.A., A.V.M.A., KPMG and J.A. Webster management estimates.
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[LOGO] Fragmented Distribution and Provider Base
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J.A. Webster is well-positioned in a highly fragmented market.
Companion Pet Veterinarian Supplies Market
Companion Pet
Manufacturers Products Channel Veterinarian Practices
* 500 * 10,000 Distributors 66% * 17,000
* 50
Agency 23%
Direct 11%
J.A. Webster: * 400 * 8,000 Top 3 * 10,000
Source: A.A.H.A., A.V.M.A., KPMG and J.A. Webster management estimates.
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* = greater than
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[LOGO] Typical Customer Profile
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The typical veterinarian practice purchases $80,000 to
$120,000 of supplies each year.
. Size
|X| $500,000 - $750,000 revenue
|X| 2 veterinarians
|X| 2 veterinarian technicians
|X| 4 - 5 other employees
. Pharmaceuticals and Supplies
|X| Represents approximately 16% of practice revenues
Source: A.A.H.A., A.V.M.A., KPMG and J.A. Webster management estimates.
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[LOGO] High Dependence on Distributors
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Veterinarians depend heavily on distributors for purchasing
supplies for their practices.
Top Supplier 59%
2nd Supplier 22%
3rd Supplier 11%
4th Supplier 5%
All Others 3%
Source: DVM Newsmagazine.
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[LOGO] Why J.A. Webster?
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Strong position in companion-pet veterinarian supplies market with
business model and culture similar to Patterson's.
. Third largest distributor and #1 in served regional markets
. Strong platform for national growth
. Seasoned management team
. Productive sales force and loyal customer relationships
. Solid manufacturer relationships
. Strong financial performance
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[LOGO] Nation's Third Largest Companion-Pet Distributor
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J.A. Webster is positioned well within
its market and has significant room to grow.
J.A. Webster 10%
Burns 12%
Butler 17%
All Others (47+) 61%
Source: J.A. Webster management estimates.
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[LOGO] Seasoned Management Team
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J.A. Webster's senior management team averages over 14 years
of company experience and is highly regarded within the industry.
YEARS WITH
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NAME AGE POSITION J.A. WEBSTER INDUSTRY
- ---- --- ---------------------- --------------- -------------
Jeff H. Webster 39 President 17 17
John A. Webster, III 41 VP, Operations 18 18
Scott A. Webster 36 VP, Marketing 6 12
Jim Herring 49 VP, Sales 13 27
Doug Simmons 55 VP, Business Development 17 32
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[LOGO] Highly Productive Sales Force with Loyal
Customer Relationships
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Experienced direct sales force lies at the core of J.A.
Webster's value-added culture.
. Viewed as consultants by customers
. 73 direct sales reps and large in-house tele-sales support
. Each sales rep averages 11 years of experience
. Average of $2 million in sales per direct sales rep
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[LOGO] Solid Manufacturer Relationships
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J.A. Webster is recognized as the distributor
of choice with the top product vendors.
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. Highest market penetration of
key vendor products in markets [LOGO OF PHOENIX PHARMACEUTICAL, INC.] [LOGO OF SCHERING]
served
[LOGO OF Abbott Laboratories Animal Health] [LOGO OF KENDALL HEALTHCARE PRODUCTS
COMPANY]
. Finest sales force in industry
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[LOGO OF Upjohn] [LOGO OF vinbac]
[LOGO OF MERIAL] [LOGO OF Bloodworth]
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[LOGO] Historical Financial Performance - Revenues
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1998A 1999A 2000A
Total $ 113.3 $ 132.3 $ 148.5
Agency Commissions $ 6.6 $ 5.8 $ 4.5
Distributed Products Revenue $ 106.8 $ 126.5 $ 144.0
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[LOGO] Historical Financial Performance - Gross Profit
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1998A 1999A 2000A
$33.7 $37.9 $41.4
29.8% margin 28.7% margin 27.9% margin
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[LOGO] Historical Financial Performance - EBIT
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($ in millions)
1998A 1999A 2000A
$11.3 $9.2 $10.5
10.0% margin 7.0% margin 7.1% margin
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[LOGO] What Is the Financial Impact on Patterson?
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The acquisition of J.A. Webster will be immediately
accretive to Patterson's consolidated financial results.
. Earnings contribution of $0.03 to $0.04 per diluted share in fiscal
year 2002
. Potential to accelerate Patterson's revenue growth
. Upside exists through national expansion effort and the realization
of synergies
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[LOGO] Potential Synergies
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Potential upside exists from both revenue and expense items.
Marketing Operations
. Expand product offerings . Logistics / distribution
. Equipment business . Administrative cost savings
. Internet / electronic order entry
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[LOGO] Conclusion
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J.A. Webster is an excellent opportunity for Patterson.
. Similar growth prospects in attractive market
. Foundation for national expansion
. Fits well with Patterson's strategy of value-added distribution
[X] Leverage Patterson's existing distribution infrastructure
[X] Consistent cultures
[X] Seasoned management team and productive sales force
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