Exhibit 99.1
The Middleby Corporation Reports Third Quarter Results
ELGIN, Ill.--(BUSINESS WIRE)--Nov. 7, 2005--The Middleby
Corporation (NASDAQ:MIDD), a leading worldwide manufacturer of
restaurant and foodservice cooking equipment, today reported sales and
earnings for the third quarter ended October 1, 2005. Net earnings for
the third quarter were $9,628,000 or $1.19 per share on net sales of
$80,937,000 as compared to the prior year third quarter net earnings
of $10,368,000 or $1.03 per share on net sales of $70,620,000. Net
earnings for the nine months ended October 1, 2005 were $24,945,000 or
$3.09 per share on net sales of $239,738,000 as compared to net
earnings of $24,248,000 or $2.42 per share on net sales of
$205,996,000 in the prior year first nine months.
Third Quarter Financial Highlights
-- Net sales rose 14.6% in the third quarter. The net sales
increase in the third quarter reflects the impact of the Nu-Vu
Foodservice Systems acquisition, which accounted for 6.9% of
the sales growth for the quarter. Excluding the impact of the
acquisition, net sales would have increased 7.7% in the third
quarter, reflecting strong growth in international business
and the impact of price increases instituted in the first
quarter to offset increased material costs.
-- Gross margin increased to 40.1% for the third quarter as
compared to 37.4% in the prior year quarter. The third quarter
gross margins benefited from production efficiencies on
increased sales volumes and a favorable sales mix, due in part
to increased international sales, which typically carry a
higher margin. Margins also improved as compared to the first
half of the year due to the realization of price increases
instituted in the first quarter and a decline in the cost of
steel during the third quarter. Additionally, margins at Nu-Vu
Foodservice Systems, which negatively impacted gross margins
during the first half, improved significantly as a result of
completed integration initiatives and higher sales volumes
during the quarter, which resulted in improved fixed overhead
absorption.
-- Operating income margin increased to 20.1% as a percent of net
sales for the third quarter compared to 17.8% in the prior
year quarter, reflecting the impact of increased sales volumes
and higher gross margins during the quarter.
-- Interest expense increased to $1,579,000 in the third quarter
of 2005 as compared to $643,000 in the prior year quarter as a
result of higher debt levels resulting from the December 2004
share repurchase transaction.
-- Provision for income taxes was recorded at a 33.1% effective
rate in the third quarter as compared to a 13.5% effective
rate in the third quarter of 2004. The tax provision for both
periods included favorable adjustments to tax reserves
associated with closed tax periods.
-- Total debt decreased to $104,099,000 at the end of the quarter
ended October 1, 2005 from $121,294,000 at the end of the
second quarter and $123,723,000 at the end of 2004. Borrowing
activity in the first nine months of 2005 included $12 million
of funding for the January Nu-Vu acquisition.
Chairman and Chief Executive Officer, Selim A. Bassoul said, "We
were very pleased with the results of the third quarter. Sales in the
third quarter, which is seasonally one of our strongest quarters, were
particularly strong due to continued growth in emerging markets and
expansion of restaurant chain customers internationally. Additionally,
sales at NuVu Foodservice Systems were also very strong during the
quarter. The third quarter sales at Nu-Vu, which we expect will be the
strongest quarter at the division this year, were favorably impacted
by the timing of store openings which accelerated for a major chain
customer during the quarter."
Mr. Bassoul added, "Looking forward, we expect the growth rate for
the company in the fourth quarter to slow due to the short-term
cancellation and delay of orders in the areas affected by the
hurricanes. Longer term, however, as these areas are rebuilt it will
positively impact our revenues."
Mr. Bassoul continued, "We were positively affected by steel
prices which began to decline during the third quarter, however, the
impact of the recent hurricanes on steel prices appears to have
curtailed these gains in the near term. Additionally, we continue to
monitor rising costs of fuel, which are beginning to impact our costs
of shipping. We were pleased with the margin improvement, which took
place at Nu-Vu Foodservice Systems. We have substantially completed
the integration efforts associated with this newly acquired business
and now will direct our efforts at this division to introducing new
products and increase our efforts in marketing these products to a
broader audience."
Conference Call
A conference call will be held at 11:00 a.m. Eastern time on
November 8, 2005 and can be accessed by dialing (800) 367-5339 and
providing conference code 2149580. Members of the financial community
who participate in the question and answer session will receive a
separate call-in number. An audio 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 2149580. A transcript of the call will also be posted
to the company's 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), Nu-Vu(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, 2005 3rd Qtr, 2004 3rd Qtr, 2005 3rd Qtr, 2004
------------- ------------- ------------- -------------
Net sales $80,937 $70,620 $239,738 $205,996
Cost of sales 48,461 44,226 147,604 127,633
------------- ------------- ------------- -------------
Gross profit 32,476 26,394 92,134 78,363
Selling &
distribution
expense 8,710 7,637 25,663 23,340
General &
administrative
expense 7,482 6,175 21,847 17,684
------------- ------------- ------------- -------------
Income from
operations 16,284 12,582 44,624 37,339
Interest
expense and
deferred
financing
amortization,
net 1,579 643 5,063 2,334
Loss (gain) on
acquisition
financing
derivatives - (96) - (96)
Other expense
(income), net 312 45 47 317
------------- ------------- ------------- -------------
Earnings
before
income taxes 14,393 11,990 39,514 34,784
Provision for
income taxes 4,765 1,622 14,569 10,536
------------- ------------- ------------- -------------
Net earnings $9,628 $10,368 $24,945 $24,248
============= ============= ============= =============
Net earnings
per share:
Basic $1.28 $1.12 $3.33 $2.63
============= ============= ============= =============
Diluted $1.19 $1.03 $3.09 $2.42
============= ============= ============= =============
Weighted
average number
shares:
Basic 7,516 9,241 7,499 9,232
============= ============= ============= =============
Diluted 8,110 10,040 8,060 10,019
============= ============= ============= =============
THE MIDDLEBY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
-------------------------------------
(Amounts in 000's)
(Unaudited)
Oct. 1, 2005 Jan. 1, 2005
------------ ------------
ASSETS
Cash and cash equivalents $3,273 $3,803
Accounts receivable, net 35,752 26,612
Inventories, net 31,981 32,772
Prepaid taxes 70 9,952
Deferred tax assets 10,593 8,865
Other current assets 1,134 2,008
------------ ------------
Total current assets 82,803 84,012
Property, plant and equipment, net 22,824 22,980
Goodwill 78,970 74,761
Other intangibles 28,488 26,300
Other assets 2,555 1,622
------------ ------------
Total assets $215,640 $209,675
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current maturities of long-term debt $12,355 $10,480
Accounts payable 14,039 11,298
Accrued expenses 48,166 51,311
------------ ------------
Total current liabilities 74,560 73,089
Long-term debt 91,744 113,243
Long-term deferred tax liability 5,978 11,434
Other non-current liabilities 4,924 4,694
Shareholders' equity 38,434 7,215
------------ ------------
Total liabilities and shareholders'
equity $215,640 $209,675
============ ============
CONTACT: The Middleby Corporation
Darcy Bretz (Investor and Public Relations), 847-429-7756
or
Timothy FitzGerald, 847-429-7744