Exhibit 99.1
The Middleby Corporation Reports Record Third Quarter Results
ELGIN, Ill.--(BUSINESS WIRE)--Oct. 28, 2004--The Middleby Corporation
(NASDAQ:MIDD), a leading worldwide manufacturer of restaurant and foodservice
cooking equipment, today reported record sales and earnings for the third
quarter and first nine months ended October 2, 2004. Net earnings for the third
quarter, including a tax benefit of $3.2 million or $0.32 per share, were
$10,368,000 or $1.03 per share on net sales of $70,621,000 as compared to the
prior year third quarter net earnings of $5,651,000 or $0.59 per share on net
sales of $60,894,000. Excluding this tax benefit, net earnings for the quarter
were $7,201,000 or $0.72 per share. Net earnings, including the third quarter
tax benefit, for the nine months ended October 2, 2004 were $24,248,000 or $2.42
per share on net sales of $205,996,000 as compared to net earnings of
$12,857,000 or $1.37 per share on net sales of $182,695,000 in the prior year
first nine months. Excluding the third quarter tax benefit, net earnings for the
first nine months of 2004 were $21,081,000 or $2.10 per share.
Financial Highlights
-- Net sales up 16.0% in the third quarter and 12.8% for the first nine
months, reflecting the impact of new product introductions and
favorable market conditions
-- Gross margin rate of 37.4% for the third quarter and 38.0% for the
first nine months as compared to 37.2% and 35.2% in the prior year
respective periods, reflecting the benefits of increased volumes and
higher margins on new products offset, in part, by increased steel
prices
-- Operating income margins of 17.8% for the third quarter and 18.1% for
the first nine months improved from 16.4% and 14.3%, respectively in
the third quarter and first nine months of 2003
-- Total debt reduced to $40,615,000 for the quarter ended October 2,
2004 from $48,315,000 at the end of the second quarter of 2004 and
$56,500,000 at the end of 2003
-- Third quarter tax benefit of $3.2 million associated with an
adjustment to tax reserves for closed tax years
"We are pleased with our 2004 performance to date," said President and
Chief Executive Officer Selim A. Bassoul. "Sales growth momentum continues to
fuel our strong financial results and reflects the impact of new products
introduced in 2003 and 2004 and an increase in the replacement business with
customers upgrading older equipment. We will continue to develop and introduce
new products that address customer needs such as improved ergonomics, energy
efficiency, speed of cooking, automation and safety." Mr. Bassoul continued,
"During the third quarter the positive margin benefits from increased volumes
and higher margin new product sales were partly offset by over $1 million in
steel price increases as compared to last year's third quarter. These price
increases, which are impacting many industries, are difficult to fully pass onto
our customers and, thus, will continue to have a negative impact on margins in
the short term. We are committed to improve operating efficiencies and reduce
operating costs in an effort to offset the impact of steel price increases and
achieve higher profit margins."
William F. Whitman, Jr., Chairman of the Board, stated, "Strong cash flows
funded the payment of a $0.40 per common share special dividend paid this July
plus the pay down of $7.7 million of debt during the third quarter. For the
first nine months of the year we have been able to reduce debt by $15.9
million."
Conference Call
A conference call will be held at 10:30 a.m. Eastern time on Friday,
October 29 and can be accessed by dialing (800) 367-5339 and providing
conference code 1820465. Members of the financial community who participate in
the question and answer session will receive a separate call-in number. A
webcast of the conference call can be accessed through investor services at
www.middleby.com. A digital replay of the call will be available approximately
one half hour after its completion and can be accessed by calling (800) 642-1687
and providing code 1820465. A transcript of the call will also be posted on the
company website.
Statements in this press release or otherwise attributable to the company
regarding the company's business which are not historical fact are
forward-looking statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. The company cautions investors
that such statements are estimates of future performance and are highly
dependent upon a variety of important factors that could cause actual results to
differ materially from such statements. Such factors include variability in
financing costs; quarterly variations in operating results; dependence on key
customers; international exposure; foreign exchange and political risks
affecting international sales; changing market conditions; the impact of
competitive products and pricing; the timely development and market acceptance
of the company's products; the availability and cost of raw materials; and other
risks detailed herein and from time-to-time in the company's SEC filings.
The Middleby Corporation is a global leader in the foodservice equipment
industry. The company develops, manufactures, markets and services a broad line
of equipment used for cooking and food preparation in commercial and
institutional kitchens and restaurants throughout the world. The company's
leading equipment brands include Blodgett(R), Blodgett Combi(R), Blodgett
Range(R), CTX(R), MagiKitch'n(R), Middleby Marshall(R), Pitco Frialator(R),
Southbend(R), and Toastmaster(R). Middleby's international subsidiary, Middleby
Worldwide, is a leading exporter and distributor of foodservice equipment in the
global marketplace. Middleby's international manufacturing subsidiary, Middleby
Philippines Corporation, is a leading supplier of specialty equipment in the
Asian markets.
For further information about Middleby, visit www.middleby.com.
THE MIDDLEBY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts in 000's, Except Per Share Information)
(Unaudited)
Three Months Ended Nine Months Ended
3rd Qtr, 3rd Qtr, 3rd Qtr, 3rd Qtr,
2004 2003 2004 2003
--------- --------- --------- ---------
Net sales $70,621 $60,894 $205,996 $182,695
Cost of sales 44,227 38,261 127,633 118,360
--------- --------- --------- ---------
Gross profit 26,394 22,633 78,363 64,335
Selling & distribution expense 7,637 7,259 23,340 22,201
General & administrative
expense 6,175 5,388 17,684 16,097
--------- --------- --------- ---------
Income from operations 12,582 9,986 37,339 26,037
Interest expense and deferred
financing amortization, net 643 1,410 2,334 4,747
Loss (gain) on acquisition
financing derivatives (96) 32 (96) (79)
Other expense (income), net 46 (254) 317 29
--------- --------- --------- ---------
Earnings before income
taxes 11,989 8,798 34,784 21,340
Provision for income taxes 1,621 3,147 10,536 8,483
--------- --------- --------- ---------
Net earnings $10,368 $5,651 $24,248 $12,857
========= ========= ========= =========
Net earnings per share:
Basic $1.12 $0.63 $2.63 $1.42
========= ========= ========= =========
Diluted $1.03 $0.59 $2.42 $1.37
========= ========= ========= =========
Weighted average number shares:
Basic 9,241 9,036 9,232 9,032
========= ========= ========= =========
Diluted 10,040 9,505 10,019 9,401
========= ========= ========= =========
THE MIDDLEBY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in 000's)
(Unaudited)
Oct 2, 2004 Jan 3, 2004
------------ ------------
ASSETS
Cash and cash equivalents $2,633 $3,652
Accounts receivable, net 29,520 23,318
Inventories, net 31,087 25,382
Deferred tax assets 11,810 12,839
Other current assets 1,497 1,776
------------ ------------
Total current assets 76,547 66,967
Property, plant and equipment, net 23,106 24,921
Goodwill 74,761 74,761
Other intangibles 26,300 26,300
Other assets 1,661 1,671
------------ ------------
Total assets $202,375 $194,620
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current maturities of long-term debt $- $14,500
Accounts payable 15,042 11,901
Accrued expenses 41,148 37,076
------------ ------------
Total current liabilities 56,190 63,477
Long-term debt 40,615 42,000
Long-term deferred tax liability 8,264 8,264
Other non-current liabilities 14,132 18,789
Shareholders' equity 83,174 62,090
------------ ------------
Total liabilities and shareholders'
equity $202,375 $194,620
============ ============
CONTACT: The Middleby Corporation
Darcy Bretz, 847-429-7756
David Baker, 847-429-7915
Timothy FitzGerald, 847-429-7744