Anacomp Inc · OTC:ANMP
Anacomp — Investor Presentation (October 2003)
46 slides from Anacomp's investor presentation, Oct 23, 2003
Slide 1: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements under the Private Securities Litigation Reform Act of 1995, including statements relating to the Company's plans regarding managing revenue generation and costs in changing environments and anticipated future market siz
Slide 2: Information Regarding Participants and Additional Information
Information Regarding Participants and Additional Information Information regarding persons who may be deemed to be participants in the solicitation of proxies on behalf of Anacomp in connection with the 2004 Annual Meeting of Stockholders has been filed by Anacomp with the Securities and Exchange C
Slide 3: The Anacomp Story
The Anacomp Story… Phil Smoot – Chairman of the Board
Slide 4: What does Anacomp do?
What does Anacomp do?
Slide 5: 2 Disciplines
2 Disciplines • Provide Information and Data Outsourcing (Document Management) • Perform Maintenance, Service & Support (MVS and Professional Services) www.anacomp.com
Slide 6: Document Management
Document Management • Information Outsourcing – Collect Î Archive Î Retrieve • Microfiche (Film or COM) • CD-R • On-line (Web): docHarbor – Why? • Cost Effective, Reliable & Secure • Compliant Solution – Local/State/Federal – HIPAA, SEC, Sarbanes-Oxley, Gramm-Leach – Post 9/11 – Business Continuity
Slide 7: How about some examples?
How about some examples? • Typical business Applications… Investment Telecom and Insurance Retail and Medical Services Utilities Companies Manufacturing Services Investor Content Customer Customer Shipping and Claims Delivery Service Service Logistics Forms Patient Forms E-Mail Archive
Slide 8: Professional Services
Professional Services • Multi-Vendor Service and Support – Commercial Businesses - COM • Outsource • In-house – Global Manufacturing Businesses • Want to Develop, Manufacture and Sell • Don’t Want Warranty – Maintenance Support – Repair (Onsite Break/Fix) • Don’t Want Post Warranty Service & Repairs
Slide 9: How about some examples?
How about some examples? • Multi-Vendor Services and Support RAID, SANs, LANs, Routers, Converters Network Services Laser Printers Tape/Optical Libraries www.anacomp.com
Slide 10: How we got here...
How we got here...
Slide 11: History of Anacomp
History of Anacomp… • Full of Ups and Downs 1985 1988 1998 - 1999 • Change to Anacomp August 2000 • Launches the • FIRSTIMAGE Acquired Management Team • Financial Crisis XFP2000 – the industry’s (COM Market Share) (Founders exit) most advanced imaging • Anacomp launches MVS • New Leadership Team pla
Slide 12: Financial Crisis
Financial Crisis... 1001) yee
Slide 13: August 2000 – Critical Condition
August 2000 – Critical Condition • Company Snapshot –$310M in Bond Debt • $32M interest payment defaulted –$74M Bank Revolver –$7M/Mo. Cash Burn www.anacomp.com
Slide 14: Financial Crisis
Financial Crisis • Cash Flow Cash & Revolver Availability $30,000 $25,000 $20,000 12/31/00 $15,000 3/31/01 6/30/01 9/30/01 $10,000 12/31/01 3/31/02 6/30/02 $5,000 9/30/02 12/31/02 3/31/03 $0 6/30/03 9/30/03 -$5,000 -$10,000 -$15,000 11/26/00 11/26/01 11/26/02 7/26/00 9/26/00 1/26/01 3/26/01 5/26/01
Slide 15: Financial Crisis
Financial Crisis • Restructured Subordinated Debt (100%) – $310M Î Equity – Equity Î 7 year Warrants • Restructured Revolver – New Covenants – Same Bank Group • Consensual Exchange – SEC (200 comments Î 2 yrs & Several Million $) – Pre-pack (San Diego Federal Court) • Oct. 19th – Dec. 31st 2001 (49
Slide 16: Financial Crisis
Financial Crisis • Strict Cash Flow Mgmt Program • Changed Management Team – 34 SVPs Î 7 SVPs (during restructuring) • Sold or Terminated – Underperforming Units – Non-core Businesses – Businesses with large Cash Liability • European Severance • Lease Obligations • Restructured Business • 11 Units Î
Slide 17: Financial Crisis
Financial Crisis • Debt levels – (Notes, Term Loans, Revolver, Preferred Stock and Accrued Interest - $M) $500 $450 $400 $350 $300 $250 $200 $150 $100 $50 $- 1996 1997 1998 1999 2000 2001 2002 2003 9/30/03 – Cash $18,390K Revolver $5,917K Cash Positive www.anacomp.com
Slide 18: The FUTURE Anacomp...
The FUTURE Anacomp... er 8 —a 1001) ia bi
Slide 19: The Why
The Why …While we still must overcome a declining COM (Supplies & Services) base: • 35 Years of Outsourcing Experience – Culture of Customer Service – Marvelous/Loyal Employee Base (1,324) – Serve 7,000+ businesses in 70 countries – Customers represent more than half (50%) of the Fortune 500 compani
Slide 20: A Sample of our Customers
A Sample of our Customers Monogram Credit www.anacomp.com
Slide 21: Multi-Vendor Services
Multi-Vendor Services • MVS Market Growing to $5 Billion by 2005 • Global Approach (one of few) – Expanded Services • Maintenance Support – Call Center – Help Desk • Warranty Registration and Support • Remote Diagnostics • Repair Services – Onsite Break/Fix – Depot Repair – Logistics www.anacomp.com
Slide 22: A Sample of our Customers
A Sample of our Customers www.anacomp.com
Slide 23: In closing...
In closing… www.anacomp.com
Slide 24: Anacomp's Financial Performance
Anacomp’s Financial Performance Lin Fox – Executive VP & Chief Financial Officer
Slide 25: Growth vs. Legacy
Business Offerings Definitions Growth vs. Legacy www.anacomp.com
Slide 26: Growth vs. Legacy Quarterly Revenue
Growth vs. Legacy Quarterly Revenue $M 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 Growth 16.6 17.7 17.3 18.1 18.0 19.3 18.9 19.9 20.2 20.3 20.4 Legacy 59.5 56.3 50.1 46.6 42.5 41.3 37.6 36.8 32.8 32.5 29.4 www.anacomp.com
Slide 27: Growth Business Offerings
Business Offerings Growth www.anacomp.com
Slide 28: Growth Business Offerings
Growth Business Offerings MVS - Our Multi-Vendor Services offering provides a variety of services for OEM products, including installation, maintenance, call center and depot repair 25%+ growth Web - Our Web presentment “docHarbor” offering stores, delivers and accesses documents via the internet 20
Slide 29: MVS Quarterly Revenues
MVS Quarterly Revenues $M 10.0 8.0 6.0 4.0 2.0 0.0 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 MVS 5.0 5.5 5.8 6.1 6.5 6.4 6.9 7.3 8.1 8.2 9.0 www.anacomp.com
Slide 30: MVS Competitive Analysis
MVS Competitive Analysis The competition typically offers break - fix with limited on site support beyond peripherals and switches. Some organizations provide Help Desk support as well as Depot Repair services, but most companies do not offer Global, single point contact/contract support.... Global
Slide 31: Web Quarterly Revenues
Web Quarterly Revenues $M 6.0 5.0 4.0 3.0 2.0 1.0 0.0 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 Web 2.7 2.3 2.7 3.0 3.1 3.9 4.0 4.6 4.8 4.7 4.3 www.anacomp.com
Slide 32: Web Competition
Web Competition In-House Software Providers BMC Software FileNet IBM Documentum – EMC purchased 10/15/03 for $1.7B Mobius Application Service Providers Imagemax Iron Mountain Lason www.anacomp.com
Slide 33: Web Competitive Analysis
Web Competitive Analysis Strong and secure data center infrastructure with best-in-class hosting environment Easy and intuitive user interface Impressive uptime and performance metrics Real-time reporting and monitoring for managing service level agreements Proven technical environment and underlyin
Slide 34: CD and Digital Quarterly Revenues
CD and Digital Quarterly Revenues $M 11.0 10.0 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 CD/Dig 8.9 9.9 8.8 9.0 8.5 9.0 8.0 8.1 7.3 7.4 7.1 CD 6.9 8.1 7.3 7.3 7.2 7.4 6.6 6.7 5.8 6.2 5.6 Digital 2.0 1.8 1.5 1.7 1.3 1.6 1.4 1.4 1.5 1.2 1.5 www.anac
Slide 35: Growth Quarterly Revenues
Growth Quarterly Revenues $M 22.0 20.0 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 Growth 16.6 17.7 17.3 18.1 18.0 19.3 18.9 19.9 20.2 20.3 20.4 MVS 5.0 5.5 5.8 6.1 6.5 6.4 6.9 7.2 8.1 8.2 9.0 Web 2.7 2.3 2.7 3.0 3.0 3.9 4.0 4.6 4.8 4.7 4.3 CD/
Slide 36: Legacy Business Offerings
Business Offerings Legacy www.anacomp.com
Slide 37: Legacy Business Offerings
Legacy Business Offerings Output Services – COM service bureaus that can image from the host computer directly to computer output microfilm 20%+ decline Professional Services – COM maintenance services for micrographic equipment 20%+ decline Equipment and Supplies – Sale to end users of micrographic
Slide 38: Legacy Quarterly Revenues
Legacy Quarterly Revenues $M 65.0 60.0 55.0 50.0 45.0 40.0 35.0 30.0 25.0 20.0 15.0 10.0 5.0 0.0 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 Legacy 59.5 56.3 50.1 46.6 42.5 41.3 37.6 36.8 32.8 32.5 29.4 Output Services 31.9 31.2 27.9 26.5 25.0 24.2 22.0 20.9 19.2 18.8 16.9 Equip & Supplie
Slide 39: Total Quarterly Revenues
Total Quarterly Revenues $M 80.0 60.0 40.0 20.0 0.0 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 Output Services 31.9 31.2 27.9 26.5 25.0 24.2 22.0 20.9 19.2 18.8 16.9 MVS 5.0 5.5 5.8 6.1 6.5 6.4 6.9 7.2 8.1 8.2 9.0 Equip & Supplies 18.8 16.3 14.1 12.5 10.6 10.9 9.5 10.0 8.1 8.4 7.3 CD/Dig
Slide 40: Inflection Point of Quarterly Revenues
Inflection Point of Quarterly Revenues $M 80.0 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 Growth 16.6 17.7 17.3 18.1 18.0 19.3 18.9 19.9 20.2 20.3 20.4 Legacy 59.5 56.3 50.1 46.6 42.5 41.3 37.6 36.8 32.8 32.5 29.4 Total 76.1 74.0 67.4 64.7 60.5 60.6
Slide 41: Cash Performance
Cash Performance EBITDA FREE CASH FLOW DEBT www.anacomp.com
Slide 42: EBITDA by Product Offering
EBITDA by Product Offering EBITDA by product offering cannot be measured accurately because of the consolidation of our business operating groups – All product offerings have shared costs for facilities, personnel, management, ITS, corporate and other costs. – Our ability to leverage the shared cost
Slide 43: EBITDA and Free Cash Flow by Quarter
EBITDA and Free Cash Flow by Quarter $M 1Q02 Revenue $60.5M 8 7 6 3Q03 Revenue $49.8M 5 4 3 2 1 0 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 EBITDA 7.4 7.2 6.3 4.9 5.1 5.2 5.1 Free Cash Flow 4.4 4.9 3.7 2.7 3.6 3.5 4 Cap Ex 1.1 1.1 1 0.6 0.8 0.7 0.5 Interest 1.4 0.6 0.8 0.8 0.6 0.4 0.2 Intl Tax (no US) 0.5
Slide 44: Gross Margin % Integrity
Gross Margin % Integrity $M 60.0 50.0 40.0 30.0 31.7% 33.2% 31.0% 31.8% 32.8% 32.5% 30.9% 20.0 10.0 0.0 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 Revenue 60.5 60.6 56.5 56.7 53.0 52.8 49.8 Direct Cost 41.3 40.5 39.0 38.6 35.6 35.6 34.4 GM 19.2 20.2 17.5 18.0 17.4 17.2 15.4 E,S,G&A 19.0 17.4 15.5 17.4 16.3
Slide 45: Headcount Control
Headcount Control 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 Headcount 1,773 1,744 1,681 1,614 1,583 1,511 1,445 1,324 US 1,270 1,228 1,175 1,113 1,083 1,015 969 848 Intl 394 406 399 396 398 400 391 391 Central Servs 109 110 107 105 102 96 85 85 www
Slide 46: Debt Revolver Repayment Performance
Debt Revolver Repayment Performance $M Repaid $49.2M in 2 Years 60.0 55.0 50.0 45.0 40.0 35.0 30.0 25.0 20.0 15.0 10.0 5.0 0.0 4Q01 1Q01 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 Excess Payments 9.700 15.600 16.100 20.775 32.460 34.412 35.408 Scheduled Payments 2.000 4.000 6.000 9.000 10.125 11.250 12.500