MIME-Version: 1.0 Content-Type: multipart/related; boundary="----=_NextPart_01C6B7AB.DC8879A0" This document is a Single File Web Page, also known as a Web Archive file. If you are seeing this message, your browser or editor doesn't support Web Archive files. Please download a browser that supports Web Archive, such as Microsoft Internet Explorer. ------=_NextPart_01C6B7AB.DC8879A0 Content-Location: file:///C:/F3199A55/Earnings2006Q2v80215.htm Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii" THE MIDDLEBY CORPORATION

THE MIDDLEBY CORPORATION

<= /span> <= /span>


1400 Toastmas= ter Drive, Elgin, Illinois 60120 · (847) 741-3300 · Fax (847) 741-1689

 

 

The Middleby Corporati= on Reports Record Second Quarter Results

 

Elgin, IL, August 3, 2006= – The Middleby Corporation (NASDAQ: MIDD= ), a leading worldwide manufacturer of restaurant and foodservice cooking equipment, today reported record sales and earnings for the second quarter ended July 1, 2006.  Net earnings for the second quarte= r were $11,090,000 or $1.34 per share on net sales of $104,849,000 as compared to = the prior year second quarter net earnings of $8,969,000 or $1.11 per share on = net sales of $83,912,000.  Net ear= nings for the six months ended July 1, 2006 were $19,141,000 or $2.32 per share on = net sales of $201,598,000 as compared to net earnings of $15,317,000 or $1.91 p= er share on net sales of $158,801,000 in the prior year first half.  

 

 

Second Quarter = Financial Highlights

 

·         Net sales rose 25.0% in the second quarter.<= span style=3D'mso-spacerun:yes'>  The net sales increase in the seco= nd quarter reflects the impact of the acquisition of Alkar Holdings, Inc. ("Alkar") completed in December 2005, which accounted for 17.7% of sales growth for the quarter.   Excluding the Alkar acquisition, sa= les rose 7.3% in the second quarter, reflecting the impact of new product sales= and continued growth in restaurant chain business. 

 

·         Operating income increased by 24.1% to $20,2= 79,000 from $16,337,000, reflecting the benefit of increased sales and higher gross margins.  As a percentage of s= ales operating income decreased to 19.3% from 19.5% in the prior year, reflecting the impact of lower operating margins associated with the recently acquired Alkar business.

 

·         The company began expensing stock options du= ring the first quarter of 2006 as a result of the adoption of Statement of Financial Accounting Stand= ards ("SFAS") No. 123(r): "Accounting for Stock Based Compensation", resulting in an increase to general and administrative expenses of $365,000 during the second quarter and a reduction to net earni= ngs of $250,000 or $0.03 per share.  No such expense was recorded in the second quarter of 2005. 

 

·         Interest expense increased to $2,031,000 in = the second quarter as compared to $1,698,000 in the prior year quarter as incre= ased interest rates offset the favorable impact of reduced debt levels. 

 

·         Operating cash flows were utilized to reduce= total debt by $11,206,000 during the second quarter to $109,334,000 as compared to $120,540,000 at the end of the first quarter.   

 

 

Mr. Selim A. Bassoul = Chairman and Chief Executive Officer said, "We were very pleased with the resul= ts of the second quarter.  We con= tinue to realize sales growth from increased business with restaurant chains and = from the benefit of new product introductions, including the Middleby Marshall W= OW conveyor oven which we began to produce and ship during the second quarter.=   We were also pleased to introduce = several other new products during the quarter, including the Southbend StratoSteam countertop steamer, the Southbend 500 ser= ies premium range, and a new rotating rack bakery oven from Blodgett.  We remain excited about the contin= uing pipeline of new products focused on speed of cooking, energy savings, and automation.”

 

Mr. Bassoul continued, “We were also very proud to have received the vendor of the year awar= d at our Blodgett division from Pride, a leading dealer buying group, as well as= the YUM! Star Supplier of the year award at our Pitco division.  During the quarter,= our NuVu division also received the National Restaurant Association Kitchen Innovation Award for its new Rhapsody Combo-bake oven.”

 

Mr. Bassoul further c= ommented, “As anticipated, we began to realize improvement in profitability at = our newly acquired Alkar Rapidpak business unit as a result of our integration efforts.  <= /span>During the quarter we announced the promotion of Magdy Albert as the Division President of Alkar RapidPak.  This business will benefit from Magdy’s 25 years of engineering and operations experience in the foodservice industry, including his most recent tenure as= Vice President of Operations and General Manager of our Middleby Marshall divisi= on where he recently oversaw the development of the WOW oven.  Under Magdy&#= 8217;s leadership, we are committed to the delivery of innovative products to the customers of Alkar and Rapidpak.” 

 

Mr. Bassoul concluded, “As we move into the second half of the year, we will monitor the imp= act of rising costs of steel and fuel, which are anticipated to impact profit margins.  We will make efforts= to offset these rising costs through supply chain initiatives and other operat= ing improvements.”

          =             &nb= sp;            =             &nb= sp;            =             &nb= sp;            =             &nb= sp;            =             &nb= sp;            =             &nb= sp;            =             &nb= sp;            =             &nb= sp;            =   

Conference Call

 

A conference call wil= l be held at 11:00 a.m. Eastern time o= n Friday, August 4 and can be accessed by dialing (800) 367-5339 and providing conference code 4068362 or throug= h the investor relations section of The Middleby Corporation website at = www.middleby.com.  A digital replay of the call will = be available approximately one half hour after its completion and can be acces= sed by calling (800) 642-1687 and providing code 4068362.  A transcript of the call will also = be posted to the company's website.

 

Statements in this pr= ess release or otherwise attributable to the company regarding the company̵= 7;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 compa= ny cautions investors that such statements are estimates of future performance= and are highly dependent upon a variety of important factors that could cause a= ctual results to differ materially from such statements.  Such factors include volatility in earnings resulting from goodwill impairment losses; variability in financing costs; quarterly variations in operating results; dependence on key custome= rs; international exposure; foreign exchange and political risks affecting international sales; protection of trademarks, copyrights and other intellectual property; 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 o= ther risks detailed herein and from time-to-time in the company’s SEC filings.

  

The Middleby Corporat= ion 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 preparatio= n in commercial restaurants, institutional kitchens and food processing operatio= ns throughout the world.  The company’s leading equipment brands include Alkarâ= , Blodgett= â, Blodgett Combi= â, Blodgett = Rangeâ, CTXâ, MagiKitch’nâ= , Middleby Marshallâ, Nu-Vuâ, Pitco Frialatorâ, RapidPakâ, Southbendâ, and Toastmaster= â.  Middleby’s international subsidiary, Middleby Worldwide, is a leading exporter and distributor of foodservice equipment in the global marketplace. Middleby’s internati= onal manufacturing subsidiary, Middleby Philippines Corporation, is a leading supplier of specialty equipment in the Asian markets.

 

For further informati= on about Middleby, visit www.middleby.com.

 

Contact:        &= nbsp;   Darcy Bretz, Investor and Public Relations, 847-429-7756

Ti= mothy FitzGerald, Chief Financial Officer, 847-429-7744

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 <= /o:p>
THE MIDDLEBY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS=

(Amounts in 000’s, Except Per Share Information)

(Unaudited)

 

        &= nbsp;           &nbs= p;            &= nbsp;           &nbs= p;            &= nbsp;    Three Months Ended     &= nbsp;           &nbs= p;  Six Months Ended

  &n= bsp;           =             &nb= sp;            =          <= /p>

 

2nd Qtr, 2006 &nb= sp;

2nd Qtr, 2005 &nb= sp;

2nd Qtr, 2006 &nb= sp;

2nd Qtr, 2005 &nb= sp;

Net sales

     $  104,849

$  83,912

$  201,598

$  158,801

Cost of sales

   63,122

   51,326

  124,347

    99,143

 

 

 

 

 

    Gross profit

 41,727

 32,586

77,251

59,658

 

 

 

 

 

Selling & distribution expense   

    10,767

    8,769

20,892

16,953

General & administrative expense<= /o:p>

   10,681

     7,480

     20,932

     14,365

 

 

 

 

 

    Income from operatio= ns

    20,279

    16,337

35,427

28,340

 

 

 

 

 

Interest expense and deferred       &nbs= p;  

 

 

 

 

    financing amortizati= on, net

   2,031

   1,698

3,827

3,484

Loss (gain) on acquisition financing<= /o:p>

    Derivatives

 

-

 

-

 

-

 

-

Other expense (income), net

       16= 5

       (6= 2)

       &nbs= p;    72

       (2= 65)

 

 

 

 

 

    Earnings before inco= me taxes

18,083

14,701

31,528

25,121

 

 

 

 

 

Provision for income taxes

     6,993

     5,732

      12,387

       9,= 804

 

 

 

 

 

    Net earnings

$  11,090

$   8,969

$    19,141

$    15,317

 

 

 

 

 

 

 

 

 

 

Net earnings per share:<= /p>

 

 

 

 

 

 

 

 

 

    Basic

$    1.45

$    1.19

$       2.= 51

$       2.= 04

 

 

 

 

 

    Diluted

$    1.34

$    1.11

$       2.= 32

$       1.= 91

 

Weighted average number shares:=

 

 

 

 

 

 

 

 

 

    Basic

      7,623

      7,508

      7,620

      7,490

 

=  

=  

 

 

    Diluted

      8,264

      8,050

      8,261

      8,035

 

 

 

 

 

 

 

 

 

 

THE MIDDLEBY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in 000’s)

(Unaudited)

 

        &= nbsp;     &n= bsp;            = ;            &n= bsp;                =             &nb= sp;            =                        =             &nb= sp;            =            

 

 

 

 

 

 

Jul. 1, 2006

 

Dec. 31, 2005

 ASSETS

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

$      3,156

 

$      3,908

 

Accounts receivable, net=

    47,908

 

    38,552

 

Inventories, net

43,769

 

40,989

 

Other current assets

6,581

 

4,513

 

Prepaid taxes

--

 

3,354

 

Deferred tax assets

      11,428

 

     10,319

 

    Total current assets=

112,842

 

101,635

 

 

 

 

 

 

Property, plant and equipment, net

24,509

 

25,331

 

 

 

 

 

 

Goodwill

98,832

 

98,757

 

Other intangibles

34,895

 

35,498

 

Other assets

        3,061

 

        2,697

 

 

 

 

 

 

    Total assets

$  274,139

 

$  263,918

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES A= ND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

Current maturities of long-term debt<= /o:p>

$    15,337

 

$    13,780

 

Accounts payable

19,779

 

17,576

 

Accrued expenses

      58,977

 

      62,689

 

    Total current liabil= ities

94,093

 

94,045

 

 

 

 

 

 

Long-term debt

94,007

 

107,815

 

Long-term deferred tax liability

9,200

 

8,207

 

Other non-current liabilities

6,338

 

5,351

 

 

 

 

 

 

Shareholders’ equity

      70,501

 

      48,500

 

 

 

 

 

 

    Total liabilities and shareholders’ equity

$  274,139

 

$  263,918

 

   

 

 

 

 

 

 

 

 

 

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