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Presentation to Lenders
January 2014

Confidential
Legal
Disclaimer
These slides and the accompanying oral discussion contain certain statements that are not historical fact...
Management
Presenters

President and CEO

Shawn Poe
Vice President and CFO

President and Chief Executive Officer since 20...
Today’s
Agenda
1. Introduction

Credit Suisse

2. Company overview

Gary Robinette
President & CEO, Ply Gem

3. Key credit...
Transaction
Overview

•

Transaction overview

Headquartered in Cary, NC, Ply Gem (“Ply Gem” or the “Company”; NYSE: PGEM)...
Transaction
Overview

Transaction structure

Sources & uses
($ in mm)

Sources

Uses

First lien term loan

$380.0

Refina...
Strategic
Priorities

Associate development
Succession plan
Communicate & empower

•
•
•

Customer solutions  
Customer ex...
Company
Overview

Company overview

7
Company
Overview

One of the largest manufacturers of 
exterior building and home improvement 
products in North America
•...
Company
Overview

Leading manufacturer of exterior building 
products
•

#1 in vinyl siding in North America

•

#1 in alu...
Company
Overview

Extensive exterior product portfolio

Gable vents and accessories
Gutter protection systems
Vinyl and al...
Company
Overview

One, integrated business with two 
reportable segments 

Siding, fencing, and stone

Windows and doors

...
Company
Overview

Complete Exterior Solution Offering for Customers
•
•
•
•
•

BEFORE

Alexandria, VA Designed Exterior Re...
Company
Overview

Safety is Ply Gem’s top priority

Recordable incident rate
Ply Gem Industries, Inc.

7.26

WORLD CLASS

...
Company
Overview

Culture of innovation drives new growth 
opportunities

Furthering a culture of innovation

A key growth...
Credit
Highlights

Key credit highlights

15
Credit
Highlights

1
Market leader

8

2
Comprehensive product
portfolio with strong brand
recognition

Proven and experie...
Credit
Highlights

Market leader: vinyl siding

Why Ply Gem wins

•

#1 vinyl siding manufacturer in North America 
(~40% ...
Credit
Highlights

Market leader: vinyl and aluminum 
windows (cont’d)

Why Ply Gem wins

•

#1 vinyl and aluminum window ...
Credit
Highlights

Multi‐channel distribution network
serving a broad customer base

Broad supply chain

Representative cu...
Credit
Highlights

Favorable industry dynamics driving 
increased homebuilding 

Improvement across major economic indicat...
Credit
Highlights

Favorable industry dynamics driving 
increased homebuilding (cont’d)

Siding, fencing, and stone(1)

Wi...
Credit
Highlights

Highly efficient, flexible, low cost 
operating structure

Facility overview

2012 Cost structure (net ...
Credit
Highlights

Proven track record of acquisition 
integration / cost savings realization

Ply Gem purchased 
by CI Ca...
Credit
Highlights

Proven track record of acquisition 
integration / cost savings realization
(cont’d)

Track record of ef...
Credit
Highlights

Substantial / sustainable free cash flow  

FCF: Adjusted EBITDA – capital expenditures

Capital spendi...
Credit
Highlights

Proven and experienced management team

Gary E. Robinette
President & CEO
Industry experience: 35 years...
Financial
Overview

Financial overview

27
Financial
Overview

Key financial performance

Net sales 

Gross profit 

($ in mm)

($ in mm)

1600
$1,364

$1,175

1200
...
Financial
Overview

Momentum building through strong 2012 
performance

Steady LTM sales trajectory

Sustained LTM adj. EB...
Financial
Overview
•
•
•
•

•
•

Recent developments

4Q13 challenging due to severe weather compounded by continued lag i...
Financial
Overview

Cost savings / one time costs – Gienow and 
Mitten

EBITDA impact of Gienow and Mitten cost savings
($...
Financial
Overview

3Q13 and YTD 3Q13  highlights

3Q reported results

YTD 3Q13 reported results
($ in mm)

($ in mm)

Ne...
Financial
Overview

3Q13 gross margin summary

Quarter‐over‐quarter gross margin

New customer win costs     ‐0.4%

3Q12 g...
Financial
Overview
•
•
•

Ply Gem less volatile than the market
Reported Ply Gem sales

Ply Gem continues to outperform th...
Financial
Overview

Stable gross profit margins

30%
20%
10%

Impact of “take or
pay” contract

0%
2005

2006

2007

2008
...
Financial
Overview

Action taken through the cycle positions for 
expanding profitability
Fiscal Year Ended December 31,

...
Financial
Overview

Leverage profile

Net debt / LTM EBITDA
10.0x
8.5x

8.3x
7.5x

8.0x

6.2x

6.1x

5.5x

6.0x
4.0x
2.0x
...
Conclusion
1
Market leader

8

2
Comprehensive product
portfolio with strong brand
recognition

Proven and experienced
man...
Syndication
Overview

Syndication overview

39
Transaction
Overview

Summary indicative term sheet
First lien senior secured credit facility

Borrower: 

Ply Gem Industr...
Syndication
Overview

Indicative timeline

January 2014
M

T

W

T

1 2
6 7 8 9
13 14 15 16
20 21 22 23
27 28 29 30

Date:...
Public
Q&A

Public Q&A

42
Appendix

Appendix

43
Appendix

Adjusted EBITDA reconciliation
Year ended December 31, 
2010A
2011A
2012A 

Net income 
Interest expense, net
Pr...
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Transcript of "Ply gem lp (1 13-2014).pdf"

  1. 1. Presentation to Lenders January 2014 Confidential
  2. 2. Legal Disclaimer These slides and the accompanying oral discussion contain certain statements that are not historical facts,  including information concerning possible or assumed future results of our operations.  Those statements  constitute “forward‐looking statements” within the meaning of the Private Securities Litigation Reform Act of  1995.  Such statements involve known and unknown risks, uncertainties and other factors that could cause the  actual results of the Company to differ materially from the results expressed in or implied by our forward‐looking  statements, including the availability and cost of raw materials and purchased components, the level of  construction and remodeling activity, changes in general economic and business conditions, conditions affecting  the industries we serve and our customers, the rate of sales growth, availability of labor force and efficiencies,  product liability claims, our high degree of leverage and other factors discussed in the Company’s news releases,  public statements and/or filings with the Securities and Exchange Commission, including the Company’s most  recent Annual and Quarterly Reports on Form 10‐K and Form 10‐Q.  Many of these factors are outside of the  Company’s control and all of these factors are difficult or impossible to predict accurately.  The Company  undertakes no obligation to update publicly any forward‐looking statements, whether as a result of new  information, future events or otherwise.  In addition, these slides and the accompanying oral discussion reference non‐GAAP financial measures, such as  adjusted EBITDA.  A reconciliation of each non‐GAAP financial measure to the most directly comparable GAAP  financial measure is provided in the appendix provided herein and our earnings releases posted on  www.plygem.com. 1
  3. 3. Management Presenters President and CEO Shawn Poe Vice President and CFO President and Chief Executive Officer since 2006 • 35+ years of experience in the building products  and distribution industry  • Gary Robinette • Prior to joining Ply Gem, served as Executive Vice  President and COO of Stock Building Supply • Vice President and Chief Financial Officer since  2004 • 23+ years of experience  • Prior to his current role, served as VP of Finance  of siding and accessories subsidiaries 2
  4. 4. Today’s Agenda 1. Introduction Credit Suisse 2. Company overview Gary Robinette President & CEO, Ply Gem 3. Key credit highlights Gary Robinette President & CEO, Ply Gem 4. Financial overview Shawn Poe Vice President & CFO, Ply Gem 5. Syndication overview Credit Suisse 6. Public Q&A 3
  5. 5. Transaction Overview • Transaction overview Headquartered in Cary, NC, Ply Gem (“Ply Gem” or the “Company”; NYSE: PGEM) is a leading manufacturer of  residential exterior building products, offering a comprehensive product line of vinyl siding and skirting, vinyl  windows and doors, and aluminum windows in all 50 states and Canada − LTM 9/28/13 PF(1) net sales and PF adjusted EBITDA of $1,435mm and $152mm, respectively • Ply Gem is refinancing its existing senior secured notes and senior unsecured notes with: − $380mm first lien term loan − $550mm senior unsecured notes • PF senior secured and total net leverage of 2.5x and 6.1x, respectively, of LTM 9/28/13 PF adjusted EBITDA of  $152mm (1) Gives effect for LTM impact of Gienow and Mitten acquisitions and expected 2014 cost savings. 4
  6. 6. Transaction Overview Transaction structure Sources & uses ($ in mm) Sources Uses First lien term loan $380.0 Refinance outstanding 8.25% senior secured notes (1) $813.5 Senior unsecured notes $550.0 Refinance outstanding 9.375% senior notes (1) $110.6 Cash on hand $11.0 Total sources (1) (2) Estimated transaction fees & ex penses $941.0 (2) $16.9 Total uses $941.0 Includes prepayment premiums and accrued interest payments pro forma for the transaction at 9/28/13. Includes OID. Pro forma capitalization ($ in mm) Actual 9/28/13 Cum. Net EBITDA (x) 9/28/13 Cum. Net EBITDA (x) Maturity $23 Cash (1) Asset-based RCF New first lien term loan 8.250% Senior secured notes due Feb-18 Total secured debt 9.375% Senior notes due Apr-17 New senior unsecured notes Total debt $12 $14 $14 Nov-18 – 380 2021 756 $770 – 4.9x $96 $2,006 LTM 9/28/13 PF Adj. EBITDA(2) $152 Current facility size of $250mm. Gives effect for LTM impact of Gienow and Mitten acquisitions and expected 2014 cost savings. Feb-18 2.5x Apr-17 $550 5.5x $1,140 Total capitalization $394 – – $866 Public equity (as of 1/10/14) (1) (2) Pro forma $944 2022 6.1x $1,140 13.0x $2,084 13.6x $152 5
  7. 7. Strategic Priorities Associate development Succession plan Communicate & empower • • • Customer solutions   Customer experience Leading brands Measure • • • • Customer  Focus Human Resources Innovation • • • • LEVERAGE New Products / Solutions Utilize technology Open collaboration Sustainability Profitable Growth Continuous  Improvement • • • World class safety & quality Low cost producer Efficient supply chain • • • Business diversity Cross sell our products Double digit growth 6
  8. 8. Company Overview Company overview 7
  9. 9. Company Overview One of the largest manufacturers of  exterior building and home improvement  products in North America • • $1.4 Billion in LTM 9/28/13 PF sales Approximately 6,700 associates 45% 55% 55% WINDOWS 45% SIDING NEW CONSTRUCTION / R&R Leading exterior building and home improvement products company in the U.S. 8 Note: LTM 9/28/13 PF figures give effect for LTM impact of Gienow and Mitten acquisitions. 
  10. 10. Company Overview Leading manufacturer of exterior building  products • #1 in vinyl siding in North America • #1 in aluminum accessories in U.S. • #1 in vinyl / aluminum windows in U.S.  • #1 in windows in Western Canada Provider of branded products for new construction and home improvement markets,  sold through a multitude of distribution channels covering a variety of price points 9
  11. 11. Company Overview Extensive exterior product portfolio Gable vents and accessories Gutter protection systems Vinyl and aluminum soffit Window mantles Manufactured stone Vinyl and aluminum siding Shutters Mounting blocks Decorative corner posts Rain removal systems Door surround systems Patio Doors Windows Railing and fencing Composite rail Outdoor structures Exterior doors New window technology PVC trim Suite of new exterior products 10
  12. 12. Company Overview One, integrated business with two  reportable segments  Siding, fencing, and stone Windows and doors ($ in mm) $1,000 ($ in mm) $828 $800 $709 $577 $600 $604 $639 40.0% 30.0% 20.0% 10.0% 0.0% (10.0%) (20.0%) $712 $658 $400 $200 $0 2007 2008 2009 Sales 2010 2011 $800 $600 CertainTeed 31% $374 $392 $396 $463 $0 2007 2008 2009 Sales 2010 2011 40.0% 30.0% 20.0% 10.0% 0.0% (10.0%) (20.0%) 2012 LTM 9/28/13 Operating earnings margin Window market share (all types) 2012 Ply Gem 28% $589 $466 $200 LTM 9/28/13 Operating earnings margin 2008 Other 7% $535 $400 2012 Vinyl siding market share Heartland 7% Royal 5% Crane 4% KP 7% Associated  Materials 11% $1,000 Kaycan 5% Exterior/Royal 13% Associated  Materials 14% 2012 Other 4% Ply Gem 38% CertainTeed 26% Jeld Wen (includes doors) 15% Windows manufacturers (all substrates) Ply Gem 5% Marvin Atrium 8% 4% Other(1) 32% Pella 16% Andersen Pella Marvin JELD‐WEN Atrium Associated Materials Milgard Simonton Anderson 20% Source: Principia Partners 2008 study, management estimates. Note: LTM 9/28/13 figures include Gienow / Mitten from date of acquisition. 2008 operating earnings margin for both segments exclude goodwill impairments.  (1) Includes Associated Materials, Milgard, Simonton, MI, Weathershield, Windsor, Harvey, Champion, Amsco, Cascade, and Kolbe. 11
  13. 13. Company Overview Complete Exterior Solution Offering for Customers • • • • • BEFORE Alexandria, VA Designed Exterior Remodel Provides differentiation for Ply Gem customers Provides a single sourcing opportunity Hits the sweet spot of an emerging trend Features NAHB Green Approved products Fulfills the “One Ply Gem” MISSION AFTER Three Weeks later using The Designed Exterior concept 12
  14. 14. Company Overview Safety is Ply Gem’s top priority Recordable incident rate Ply Gem Industries, Inc. 7.26 WORLD CLASS 7.11 6.65 5.42 1.81 3.99 5.47 1.76 1.58 2009 2010 2011 5.21 5.27 3.98 3.30 2006 2007 2008 1.85 1.94 2012 3Q13 Year Ply Gem combined National trend 13
  15. 15. Company Overview Culture of innovation drives new growth  opportunities Furthering a culture of innovation A key growth initiative • Implemented innovation into Ply Gem’s  • Several businesses currently active in  compensation structure • Product development and innovation continues  to drive new sales • Developed a collaboration platform and now  measure engagement • Drive collaboration to achieve significant cross‐ selling potential • Improved platform for idea generation process • Managing innovation as a business process  through Foundation Labs foundation labs • Research concentration in advanced materials  and physics • Each Hi‐Po serves on an Innovation  project team Open innovation opportunities • Focus on supplier/partner/universities • Prime relationship with two major building  products companies in developing new business  opportunities New products • Cellular PVC trim product • New Glass Technology  • Composite building materials $400+mm of incremental annual sales from new products introduced since 2009 14
  16. 16. Credit Highlights Key credit highlights 15
  17. 17. Credit Highlights 1 Market leader 8 2 Comprehensive product portfolio with strong brand recognition Proven and experienced management team 7 3 Multi-channel distribution network serving a broad customer base Substantial and sustainable free cash flow generation 6 4 Proven track record of acquisition integration and cost savings realization Favorable industry dynamics driving increased homebuilding 5 Highly efficient, flexible, low cost operating structure 16
  18. 18. Credit Highlights Market leader: vinyl siding Why Ply Gem wins • #1 vinyl siding manufacturer in North America  (~40% share in the US) • Consolidated industry with 4 participants  holding over 90% share • Strong trade brands • Multi‐channel distribution network servicing  both new construction and R&R Key brands • State‐of‐the‐art automated manufacturing  facilities with excess capacity North American market summary ($ in mm) ~$5,300 ~$1,800 $658 Exterior Cladding Market Size Vinyl Siding Market Size Ply Gem 2012 Net Sales Market size:  According to Principia Partners. 17
  19. 19. Credit Highlights Market leader: vinyl and aluminum  windows (cont’d) Why Ply Gem wins • #1 vinyl and aluminum window  manufacturer in  the US • #1 window and door manufacturer in Western  Canada  • Multi‐channel distribution network servicing both  new construction and R&R covering every  price point Key brands • Highly efficient, vertically integrated production • North American market summary ($ in mm) Continued to gain market share during downturn ~ $9,000 $463 Market size Ply Gem 2012 net sales Market size:  Company estimate – new construction and R&R. 18
  20. 20. Credit Highlights Multi‐channel distribution network serving a broad customer base Broad supply chain Representative customers Two‐step  distributors National one‐step distributors Two‐step distributors Regional/local one‐ step distributors Retailers National one‐ step  distributors Regional local  one‐step  distributors Retailers Home Repair and  Remodeling New Construction • • Homebuilders Contractors • • Contractors Homebuilders Individuals Diversity of channels and customers with limited customer concentration  Top 10 customers account for only ~46% of 2012 net sales 19
  21. 21. Credit Highlights Favorable industry dynamics driving  increased homebuilding  Improvement across major economic indicators U.S. SFHS forecasted to increase (in thousands) 7.0% 2,073 5.4% 354 1,812 75% 338 1,513 1,342 1,147 306 1,719 73.2% 900 284 1,474 1,036 616 554 112 585 114 612 178 442 471 434 784 247 537 921 352 322 292 1,161 629 825 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E Single‐Family Sustained consistency and strength across Canada SFHS Multi‐Family Growth across healthy markets in the U.S. (in thousands) Single‐Family 227 106 228 109 211 Multi‐Family 215 191 195 97 112 131 183 118 73 121 119 2006 2007 187 105 106 149 93 76 94 83 84 78 81 2008 2009 2010 2011 2012 2013E 2014E Sources:  Zillow, Census, Conference Board, NAHB, CMHC, Market Health Index. 20
  22. 22. Credit Highlights Favorable industry dynamics driving  increased homebuilding (cont’d) Siding, fencing, and stone(1) Windows and doors(1) Home repair  & remodel 20% Ply  Gem mix New  construction 35% Ply Gem New  construction 80% Home repair  & remodel 65% Home repair  & remodel(1) 45% Housing outlook Home improvement product sales(2) New  construction(1) 55% Single family housing starts(3)  $335 bn $274 bn 1,719  1,474  1,161 1,036  825  616  442  2012 (1) (2) (3) Management estimates. Home Improvement Research Institute, Sep 2013. U.S. Census Bureau. 2015E 471  434  537  629  2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 21
  23. 23. Credit Highlights Highly efficient, flexible, low cost  operating structure Facility overview 2012 Cost structure (net sales – EBITDA) Fixed 21% Variable 79% Fixed 21% Freight & other 7% Materials 54% Vinyl = 20% Aluminum = 13% Other materials = 21% Locations Mitten Gienow Window MFG Canada Distribution Siding/Access MFG Fence + Rail MFG Stone MFG Corporate/HQ Total Source: Company filings and management estimates. 1 1 10 34 6 2 Variable  manufacturing 18% Proactively managed cost structure during market cycle 1 3 58 22
  24. 24. Credit Highlights Proven track record of acquisition  integration / cost savings realization Ply Gem purchased  by CI Capital 2004 2005 2006 2007 2013 2008 ($ in mm) Cost savings Acquisitions CT Windows ($37mm) MW Windows  ($331mm) Alenco Windows  ($127mm)  United Stone Veneer ($4mm) MHE (Alcoa) siding  business ($296mm) Mitten (CAD$79mm) $55.0 $6.8 Expected $11.0 Achieved $4.0 $4.9 Expected Achieved $22.0 Expected Gienow (CAD$20mm) Achieved • Expect to realize $15‐ $20mm in cost savings for  combined Gienow /  Mitten acquisitions • Savings driven by facility /  headcount rationalization  and vertical integration Acquisitions provide incremental capabilities and growth along with significant  synergy opportunities 23
  25. 25. Credit Highlights Proven track record of acquisition  integration / cost savings realization (cont’d) Track record of efficient cost management… Workforce Reduced by 50% between 2006 and 2011 Acquisitions Cost savings of over $70mm (excluding Gienow and Mitten) Manufacturing Rationalized 8 facilities saving over $30mm annually Supply Chain Significantly consolidated window SKUs to improve efficiency Back Office Integrated back office functions … Provides leverage for further profitable growth Utilization Incremental capacity above one million SFHS without significant capital investment Lean Continued expansion of lean manufacturing and vertical integration  Purchasing Further consolidation of purchases of raw materials, supplies and services Improved cost structure provides significant future operating leverage 24
  26. 26. Credit Highlights Substantial / sustainable free cash flow   FCF: Adjusted EBITDA – capital expenditures Capital spending ($ in mm) ($ in mm) 3.2% 15.0% $156 $80 $108 $112 $103 $103 $102 10.0% $25 $25 $20 $17 $8 5.0% $11 2.4% 1.6% $11 0.8% 0.0% 2007 2008 2009 2010 2011 Adj. EBITDA ‐ capex 2012 LTM 9/28/13 0.0% 2007 2008 2009 Capex % of Sales • Modest capex ~2.2% of sales in 2012  2010 2011 2012 LTM 9/28/13 % of Sales Debt maturity post‐transaction   ($ in mm) $550 • Post‐transaction net leverage of 6.1x  $380 • No near‐term maturities 2017 2018 ABL 2019 2020 Term Loan 2021 2022 Senior Notes A history of strong EBITDA performance, modest capital expenditure requirements  and efficient use of working capital Note: LTM 9/28/13 numbers include Gienow and Mitten from date of acquisition. 25
  27. 27. Credit Highlights Proven and experienced management team Gary E. Robinette President & CEO Industry experience: 35 years Shawn Poe Vice President & CFO 23 years Art Steinhafel President, U.S. Windows 20 years John Wayne Executive Vice President & COO 28 years John Buckley President, Siding Group 22 years Dave Schmoll Senior Vice President, HR 24 years Richard Boyer President, Ply Gem Canada /  Gienow 14 years Doug Rende President, Mitten, Inc. 30 years • Consistently outperformed the market  • Tim Johnson General Counsel 12 years Significant management equity ownership of 3.7% as of 9/28/13 • Lee Clark‐Sellers Innovation Officer 20 years Deep and proven management bench 26
  28. 28. Financial Overview Financial overview 27
  29. 29. Financial Overview Key financial performance Net sales  Gross profit  ($ in mm) ($ in mm) 1600 $1,364 $1,175 1200 $1,121 $951 $996 $1,035 40% $280 $1,033 $195 $202 800 $853 $216 $211 $244 30% $187 $200 20% 400 10% 0 0% 2007 2008 2009 2010 2011 2012 9M12 9M13 Ply Gem sales 2007 2008 2009 2010 2011 2012 9M12 9M13 Single family housing starts Gross profit SG&A % of Sales Adjusted EBITDA ($ in mm) ($ in mm) 30% $156 $155 $142 $147 $130 $139 24% $107 $131 30% $176 24% 18% 12% $96 $116 $123 $115 $127 $102 $101 18% 12% 6% 0% 2007 2008 2009 2010 2011 2012 9M12 9M13 SG&A % of Sales Source: Management, U.S. Census Bureau. Note: 9M13 numbers include Gienow and Mitten from date of acquisition. 6% 0% 2007 2008 2009 2010 2011 2012 9M12 9M13 Adj. EBITDA % of Sales 28
  30. 30. Financial Overview Momentum building through strong 2012  performance Steady LTM sales trajectory Sustained LTM adj. EBITDA performance ($ in mm) ($ in mm) $1,301 $1,013 $1,035 $1,121 $1,139 $1,074 $1,087 $1,095 $1,200 $123 $113 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 $125 $126 $127 $124 $115 $120 $127 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 Consistent seasonal adj. EBITDA performance ($ in mm) $46 $12 $7 $15 5.9% 3.3% 5.1% $44 $41 $40 $39 $41 $48 $22 $12 1Q 10 1Q 11 1Q 12 1Q 13 % of net  sales $43 4.6% 2Q 10 2Q 11 2Q 12 2Q 13 15.3% 14.5% 14.4% 11.2% 3Q 10 3Q 11 3Q 12 3Q 13 14.9% 13.2% 13.3% 11.9% $24 $25 4Q 10 4Q 11 4Q 12 10.0% 9.8% 9.2% 29 Note: 2013 numbers include Gienow and Mitten from date of acquisition.
  31. 31. Financial Overview • • • • • • Recent developments 4Q13 challenging due to severe weather compounded by continued lag in demand for higher profit margin  “big ticket” repair and remodeling products and uneven U.S. housing market recovery 4Q13 net sales expected between $330mm and $335mm with Adjusted EBITDA between $15mm to  $17mm Organic sales in 4Q13 largely flat due to a pull‐back in the new construction housing market and severe  winter weather Profitability suppressed by lower than expected sales, which resulted in lower operating leverage against  fixed manufacturing costs, labor inefficiencies driven by the uneven recovery and an unfavorable shift in  product mix. These factors are expected to be corrected by: − Continued housing market recovery and demand stability − “Enterprise lean” initiative and a significantly enhanced sales and operating planning process to be  implemented early 2014 − Announced selling price increase on U.S. windows in 4Q13, benefits from which are expected in the  future − We will be implementing additional selling price increases in early 2014 − Continued market penetration as demonstrated by recent customer wins for new cellular PVC trim − Expected to yield run‐rate sales of over $15mm when fully converted Gienow and Mitten integration progressing well, with combined acquisition cost savings expected to be in  the $15mm to $20mm range when fully implemented Company’s outlook for the future remains positive with 2014 estimates of U.S. single family housing starts  projected to increase in the range of 15% to 20%  30
  32. 32. Financial Overview Cost savings / one time costs – Gienow and  Mitten EBITDA impact of Gienow and Mitten cost savings ($ in mm) Category (1)   Raw material sourcing (2)   Headcount (3)   Material reformulations (4)   Manufacturing efficiency improvements (5)   SG&A (6)   Insourcing third party products Total 1Q14 $1.6 0.8 0.3 0.4 0.1 0.6 $3.7 2Q14 $2.1 0.9 0.4 0.5 0.1 1.0 $5.0 3Q14 $2.2 1.1 0.4 0.5 0.1 1.2 $5.4 4Q14 $1.6 0.9 0.2 0.4 0.1 0.8 $3.9 2014 $7.4 3.7 1.3 1.8 0.3 3.7 $18.1 One‐time costs to achieve savings ($ in mm) Category Severance, retention and incentives Union discussions Product harmonization Marketing materials Equipment move costs Total Note: (1) (2) (3) (4) (5) (6) Note: 1Q14 $0.4 0.2 0.1 0.4 0.3 $1.5 2Q14 $0.4 – – 0.1 0.0 $0.6 3Q14 $0.3 – – – – $0.3 4Q14 $0.0 – – – – $0.0 2014 $1.2 0.2 0.1 0.6 0.3 $2.4 One‐time costs that should be added back to EBITDA as restructuring expense. Excludes capital expenditures and one-time costs incurred during 2013. Improved procurement economics as a result of increased purchasing power Headcount reductions for manufacturing facility consolidation and duplicative salary positions   Improved material cost as a result of utilizing Ply Gem's formulations to Mitten Freight cost maximization and improved fixed overhead as a result of various manufacturing cost reductions from rationalizations Corresponding SG&A reduction as a result of fewer employees and facility (distribution centers) consolidation Savings from purchasing from internal Ply Gem businesses rather than third‐party suppliers Numbers may not tie due to rounding. 31
  33. 33. Financial Overview 3Q13 and YTD 3Q13  highlights 3Q reported results YTD 3Q13 reported results ($ in mm) ($ in mm) Net sales $407   $306   Gross profit 3Q12 3Q13 $853   YTD 3Q12 $84   $71   3Q12 $1,033   YTD 3Q13 $200   $187   3Q13 YTD 3Q12 YTD 3Q13 Adjusted EBITDA $48   $102   $101   $42   3Q12 3Q13 YTD 3Q12 YTD 3Q13 32 Source:  Reported 3Q 2013 results. Note: 2013 numbers include Gienow and Mitten from date of acquisition.
  34. 34. Financial Overview 3Q13 gross margin summary Quarter‐over‐quarter gross margin New customer win costs     ‐0.4% 3Q12 gross margin 23.1% Restructuring charges          ‐0.4% Acquisition related costs    ‐0.3% Volume 1.0% One‐time charges ‐1.1% Siding aluminum price ‐1.0% Windows ramp‐up costs Recovered on an annualized basis expected ‐0.7% Windows product mix Quarterly timing of price to aluminum material cost ‐0.7% 3Q13 gross margin 20.7% Outsized growth of our lower end  aluminum window products New construction window unit  volume up 37% 33
  35. 35. Financial Overview • • • Ply Gem less volatile than the market Reported Ply Gem sales Ply Gem continues to outperform the market SFHS down 48% from 2007 to 2012, Ply Gem  down only 17.8% ($ in mm) $1,364 Market share gains of over $350mm from 2007 to  2011 $1,301 $1,175 $1,121 $996 $1,035 2010 2011 $951 • • Continued industry leadership • Balanced customer mix at approximately 55%  siding  /  45% windows Gienow and Mitten acquisitions contributed  $108mm to 2013 LTM sales 2007 2008 2009 2012 LTM 9/28/13 ($ in mm) 2007 2008 2009 2010 2011 2012 Single family housing starts 1,036 616 442 471 434 537 629 (40.5%) (28.2%) 6.5% (8.1%) 23.7% 17.1% (29.7%) Ply Gem net sales $1,363.5 $1,175.0 (13.4%) (13.8%) $951.4 (19.0%) $995.9 4.7% $1,034.9 3.9%  $1,121.3   8.4% LTM 9/28/13 $1,301.3  16.1%  34 Note: LTM 9/28/13 numbers include Gienow and Mitten from date of acquisition.
  36. 36. Financial Overview Stable gross profit margins 30% 20% 10% Impact of “take or pay” contract 0% 2005 2006 2007 2008 Q1 2009 Q2 (1) 2010 2011 Q3 Q4 2012 (1) 2013 Q1 2005 19.8% 2006 20.0% 2007 16.5% 2008 11.9% 2009 7.1% 2010 18.1% 2011 16.6% 2012 17.9% 2013 16.3% 2005 – 2012 Avg. 16.0% Q2 24.1% 23.9% 25.0% 20.0% 24.1% 23.4% 23.5% 23.9% 20.6% 23.5% Q3 24.4% 23.6% 23.2% 19.1% 26.4% 23.2% 22.1% 23.1% 21.1% 23.1% Q4 22.2% 17.1% 18.1% 14.0% 22.5% 20.8% 20.6% 21.3% 19.6% Full year 22.8% 21.2% 20.6% 16.6% 21.2% 21.7% 21.0% 21.8% 20.9% • Ply Gem has demonstrated the ability to maintain profit margins through wide swings in commodity costs • 2008 rewind – oil prices went to $148 a barrel; gas prices went to $4.00 • 2009 includes one time “take or pay” aluminum buy • The Company demonstrated the ability to address commodity fluctuations and return to historical averages (1) Note: 2011 and 2013 gross margins adjusted to exclude the impact of the one‐time Home Depot buy‐back. 2013 figures include Gienow and Mitten from date of acquisition. 35
  37. 37. Financial Overview Action taken through the cycle positions for  expanding profitability Fiscal Year Ended December 31, ($ in mm) Single Family Housing Starts 2007 1,036 Net Sales Siding, Fencing and Railing % Growth Windows and Doors  % Growth Total Ply Gem % Growth $828.1  (17.4%) 535.4  % Margin Windows and Doors % Margin Total Gross Profit % Margin Reported Adjusted EBITDA % Margin CapEx % of Sales Determined action through the cycle Increased sales from  market share  ($350mm) (6.6%) $1,363.5  (13.4%) Gross Profit Siding, Fencing and Railing 2012 111.7  20.9%  8 plant closures,  saving $30mm  annually $176.0  12.9%  2.9%  463.3  $1,121.3  8.4%  $180.2  $50mm in synergies  achieved ($24mm post 2007) $280.4  20.6%  $658.0  17.1%  $168.7  20.4%  537  27.4%  64.0  13.8%  $244.2  Mitten and Gienow acquisitions 21.8%  $127.3  11.3%  $20.0  $24.6  1.5%  2.2%  36
  38. 38. Financial Overview Leverage profile Net debt / LTM EBITDA 10.0x 8.5x 8.3x 7.5x 8.0x 6.2x 6.1x 5.5x 6.0x 4.0x 2.0x 0.0x 2011A 2012A 3/31/13 (Pre‐IPO) 3/31/13 (Post‐IPO) 9/28/13 (Pre‐ refinancing)(1) PF 9/28/13 (Post‐ refinancing)(1) • Ply Gem’s exposure to the housing recovery and strong market position will continue to drive its ability to  deleverage • On November 1, 2013, Ply Gem entered into an amended and restated ABL facility, increasing the overall size to  $250mm and decreasing the applicable margin for borrowings to a range from 1.5 – 2.0% • The Company is expected to realize material cash interest savings as a result of the refinancing 37 Note: (1): Debt amounts calculated net of remaining unamortized original issue discount. Gives effect for LTM impact of Gienow and Mitten acquisitions and expected 2014 cost savings.
  39. 39. Conclusion 1 Market leader 8 2 Comprehensive product portfolio with strong brand recognition Proven and experienced management team 7 3 Multi-channel distribution network serving a broad customer base Substantial and sustainable free cash flow generation 6 4 Proven track record of acquisition integration and cost savings realization Favorable industry dynamics driving increased homebuilding 5 Highly efficient, flexible, low cost operating structure 38
  40. 40. Syndication Overview Syndication overview 39
  41. 41. Transaction Overview Summary indicative term sheet First lien senior secured credit facility Borrower:  Ply Gem Industries, Inc., a Delaware corporation (the “Borrower”)  Facility:  Senior secured term loan facility (the “Term Facility”):  $380mm  Maturity:  7 years  Indicative rate:  L + 350 bps  LIBOR floor:  1.00%  OID:  99.5  Use of proceeds:  (x) To redeem, repurchase or otherwise satisfy and discharge the Borrower’s 8.25% senior secured notes due 2018 and 9.375% senior notes due 2017 (the “Refinancing”)  (y) To pay for fees and expenses related to the foregoing  Guarantors:  Ply Gem Holdings, Inc. (“Holdings”) and each existing and each subsequently acquired or organized wholly‐owned domestic subsidiary of the Borrower (other than any unrestricted  subsidiaries and subject to other exceptions to be agreed)   Security:  First priority lien on substantially all non‐current assets of the Borrower and subsidiary Guarantors (other than ABL Priority Assets, on which the Term Facility will have a second  priority lien) and first priority pledge of outstanding capital stock of the Borrower, subject to customary exceptions  Mandatory prepayments:  Customary for facilities of this type and including prepayments from excess cash flow (50% with step downs to 25%  and 0% at first lien net leverage ratios TBD)  Affirmative covenants:  Usual and customary for facilities of this type  Financial covenants:  None  Limitations on the incurrence of indebtedness; liens; mergers, and consolidations; sales of assets; dividends, distributions and other restricted payments and restricted investments;  transactions with affiliates all consistent with the senior unsecured notes  Negative covenants:  40
  42. 42. Syndication Overview Indicative timeline January 2014 M T W T 1 2 6 7 8 9 13 14 15 16 20 21 22 23 27 28 29 30 Date:  F S S Key date 3 4 5 10 11 12 17 18 19 24 25 26 31   January 13th    Bank Meeting in New York City  January 23rd   Commitments due from lenders  January 30th   Close and fund  41
  43. 43. Public Q&A Public Q&A 42
  44. 44. Appendix Appendix 43
  45. 45. Appendix Adjusted EBITDA reconciliation Year ended December 31,  2010A 2011A 2012A  Net income  Interest expense, net Provision for income taxes Depreciation and amortization  Non‐cash (gain) loss on foreign currency transactions Non‐cash (gain) loss on modification or extinguishment of debt(1) Write‐off previously capitlazed offering costs Restructuring and integration expenses Acquisitions costs Customer inventory buybacks Environmental remdediation Management fee (terminated in 2013) Non cash charge of purchase price allocated to inventories Initial public offering costs Tax receivable agreement liability adjustment Adjusted EBITDA % of sales LTM EBITDA impact of Gienow and Mitten acquisitions LTM EBITDA impact of expected 2014 cost savings(2) PF Adjusted EBITDA % margin (3) (1) (2) (3) $27.7 122.8 5.0 60.7 (0.5) (98.2) 1.6 0.9 – 0.6 – 2.5 – – – $123.0 12.4% ($84.5) 101.4 0.7 54.0 (0.5) 27.9 – 1.6 – 10.1 1.6 2.3 – – – $114.5 11.1% ($39.1) 103.0 2.8 52.3 (0.4) 3.6 – 1.7 – 0.8 – 2.5 – – – $127.3 11.3% LTM 9/28/2013 ($77.1) 94.8 2.9 45.7 0.6 18.9 – 6.5 1.5 4.8 – 0.9 2.0 23.5 1.5 $126.6 9.7% $7.8 18.1 $152.4 10.6% Nine months ended 9/29/2012 9/28/2013 ($24.0) 78.5 1.6 39.6 (0.3) 3.6 – 0.5 – 0.6 – 2.1 – – – $102.2 12.0% ($62.1) 70.2 1.7 33.0 0.8 18.9 – 5.3 1.5 4.7 – 0.4 2.0 23.5 1.5 $101.5 9.8% During the year ended December 31, 2012, the Company incurred a loss on modification or extinguishment of debt of approximately $3.6mm consisting of $1.5 mm in call premiums, $0.4 mm expense of  unamortized debt issuance costs associated with the 13.125% Senior Subordinated Notes due 2014 (the “13.125% Senior Subordinated Notes”), $0.3 mm expense of unamortized discount for the 13.125%  Senior Subordinated Notes, and $1.4 mm expense of third party fees for the 13.125% Senior Subordinated Notes. During the year ended December 31, 2011, the Company incurred a loss on modification or  extinguishment of debt of approximately $27.9 mm consisting of $10.9 mm in tender premiums, $2.8 mm expense of unamortized debt issuance costs associated with the 11.75% Senior Secured Notes due  2013 (the “11.75% Senior Secured Notes”), $0.8 mm expense of unamortized discounts for the 11.75% Senior Secured Notes, $12.3 mm expense of third party fees for the 8.25% Senior Secured Notes due  2018 (the “8.25% Senior Secured Notes”), and $1.2 mm for the expense of unamortized debt issuance costs for the previous senior secured asset‐based revolving credit facility. During the year ended  December 31, 2010, the Company recorded a non‐cash gain on extinguishment of debt of approximately $98.2 mm in connection with the redemption of the 9% Senior Subordinated Notes due 2012 (the  “9% Senior Subordinated Notes”) arising from a net reacquisition price of approximately $261.8 mm versus the carrying value of the 9% Senior Subordinated Notes of $360.0 mm. Refer to slide 31 for further details on expected 2014 cost savings. EBITDA margin shown off of LTM 9/28/13 PF net sales of $1,435 million. 44
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