8-K
UFP TECHNOLOGIES INC (UFPT)
UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549
FORM 8-K
Current Report Pursuant toSection 13 or 15(d) of theSecurities Exchange Act of 1934
Date of Report (Date of earliest event Reported):
March 21, 2023
| UFP Technologies, Inc. | |
|---|---|
| (Exact Name of Registrant as Specified in Charter) | |
| Delaware | |
| --- | |
| (State or Other Jurisdiction of Incorporation) | |
| 001-12648 | 04-2314970 |
| --- | --- |
| (Commission File Number) | (I.R.S. Employer Identification Number) |
| 100 Hale Street, Newburyport, MA - USA | 01950-3504 |
| (Address of Principal Executive Offices) | (Zip Code) |
| 978-352-2200 | |
| --- | |
| (Registrant’s telephone number, including area code) | |
| N/A | |
| --- | |
| (Former name or former address, if changed since last report) | |
| Check the appropriate<br>box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following<br>provisions: | |
| --- | |
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| --- | --- |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock | UFPT | The NASDAQ Stock Market L.L.C. |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 7.01 Regulation FD Disclosure.
UFP Technologies, Inc. (the “Company”) has attached hereto as Exhibit 99.1 a copy of updated presentation materials concerning its business that it intends to use in connection with meetings with investors and other interested parties and in connection with presentations and speeches to various audiences.
Limitationon Incorporation by Reference. The information furnished in this Item 7.01, including the presentation attached hereto as Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
CautionaryNote Regarding Forward-Looking Statements. Except for historical information contained in the presentation attached as an exhibit hereto, the presentation contains forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these statements. Please refer to the cautionary notes in the presentation regarding these forward-looking statements.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description |
|---|---|
| 99.1 | Presentation |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: March 21, 2023 | UFP TECHNOLOGIES, INC. | |
|---|---|---|
| By: | /s/ Ronald J. Lataille | |
| Ronald J. Lataille, Chief Financial | ||
| Officer and Senior Vice President |
Exhibit 99.1
Welcome Investors March 2022 Welcome Investors March 2023
Forward Looking Statements 2 Certain statements in this presentation may be considered “forward - looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward - looking statements generally relate to future events or the Comp any’s future financial or operating performance and may be identified by words such as “may,” “should,” “expect,” “intend,” “will,” “estimate,” “antici pat e,” “believe,” “predict,” or similar words. These forward - looking statements are based upon assumptions made by the Company as of the date hereof and are sub ject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such fo rward - looking statements. These forward - looking statements include, among other things, statements regarding: the Company’s prospects, anticipated advanta ges the Company expects to realize from its acquisition strategies, the Company’s financial performance, targets, goals, and metrics, the Com pan y’s revenue, gross margin and operating margin targets, participation in multiple markets, its engineering and product development resources, the benef its of the Company’s product development business (including its margin and customer relationship), the Company’s business opportunities and compe tit ive advantages, the Company’s growth potential and strategies for growth, and statements about customer and industry demand. Investors are cautioned that such forward - looking statements are not guarantees of future performance and involve risks and unce rtainties, including without limitation risks associated with the identification of suitable acquisition candidates and the successful, efficient exe cution of acquisition transactions and integration of any such acquisition candidates, economic conditions that affect sales of the products of the Company’s cu sto mers, adverse changes in general economic and geopolitical conditions, including, without limitation, global supply chain disruptions, labor cost incr eas es and inflation, the ongoing conflict between Russia and Ukraine and the adverse effect such conflict has or may have on our business and results of opera tio ns, the ability of the Company to obtain new customers, the ability of the Company to fulfill its obligations on long - term contracts and to retain curr ent customers, the ability of the Company to maintain and grow its current margins, the ability of the Company to achieve its revenue, gross margin and ope rat ing margin targets, the Company’s ability to adapt to changing market needs and other factors as well as other risks and uncertainties that are detai led in the documents filed by the Company with the Securities and Exchange Commission (“SEC”). Accordingly, actual results may differ materially. The risks an d uncertainties included above are not exhaustive. Readers are referred to the documents filed by the Company with the SEC, specifically the last repo rts on Forms 10 - K and 10 - Q. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statem ent to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which any such statement is based. Use of Non - GAAP Financial Measures This presentation includes non - generally accepted accounting principles (“GAAP”) performance measures. The Company uses these no n - GAAP financial measures to facilitate management's financial and operational decision - making, including evaluation of the Company’s historical operating results. The Company’s management believes these non - GAAP measures are useful in evaluating the Company’s operating performance and are simil ar measures reported by publicly listed U.S. competitors, and regularly used by securities analysts, institutional investors, and other i nte rested parties in analyzing operating performance and prospects. These non - GAAP financial measures reflect an additional way of viewing aspects of the Compa ny's operations that, when viewed with GAAP results and the reconciliations to corresponding GAAP financial measures, may provide a more complete u nde rstanding of factors and trends affecting the Company’s business. By providing these non - GAAP measures, the Company’s management intends to provide i nvestors with a meaningful, consistent comparison of the Company’s performance for the periods presented. These non - GAAP financial measures shou ld be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP. The Company's definition o f t hese non - GAAP measures may differ from similarly titled measures of performance used by other companies in other industries or within the same indus try .
Who We Are UFP Technologies is a designer and custom manufacturer of comprehensive solutions for medical devices, sterile packaging, and other highly engineered custom products. 3 Ticker: UFPT Headquarters: Newburyport, MA Annual Revenue: ~$353 million 3,000+ Employees/ Temps Established: 1963 14 Manufacturing Facilities Key Stats: 5 Design R&D Centers Market Cap: ~$894 million 1 Share Count: ~7.6 million 1 1. As of 2/20/2023
We help our customers develop, improve, manufacture, or protect their products through: 4 Design & engineering capabilities Materials expertise Strategic locations Precision manufacturing Shaping Innovation
Our Process Innovative process from design and engineering to manufacturing and delivery 5
Product Development Business 6 We bring deep experience in flexible material - based device manufacturing, from components and packaging, to final device assembly High Margin Added Expertise Stronger Customer Relationships Long Term Manufacturing 1 2 3 4 BENEFITS
Primary Focus Areas 85% 15% • Automotive • Aerospace & Defense • Industrial / Other Single use and single patient, polymer based medical devices and sterile packaging. Custom engineered components and protective solutions incorporating highly specialized materials for: 7
MedTech 8 1. Fortune Business Insights - $489 billion as of 2021. 5.5% CAGR for a forecast period of 2022 - 2029. 2. Medical Design & Outsourcing Revenue Breakdown By Segment $489 billion, 5.5% CAGR 1 Global Medical Device Market Customers include 25 of the top 30 largest medical device manufacturers in the world 2 Applications Expertise • Robotic Surgery Drapes • Orthopedic Sterile Packaging • Catheter & Guidewire Sterile Packaging • IV Port Cleaners • Surgical Site Preparation • Minimally Invasive Surgery Ports • Negative Pressure Wound Therapy • MedSurg Beds
MedTech Portfolio Robotic Drapes Revascularization Device Needleless Injection Port Cleaner MedSurg Bed Negative Pressure Wound Therapy Compression Device 9
Advanced Components 10 INDUSTRIAL AUTOMOTIVE AEROSPACE & DEFENSE Highly engineered components and packaging used in targeted large and growing niches Our products are present on many of the world’s leading brands including GM, Ford, Mercedes, Tesla, Boeing and Lockheed Martin UFP Differentiation Precision molding Innovative design engineering Material expertise Complex laminated composites Dedicated in house tooling & equipment manufacturing AS9100 certified Strategic manufacturing locations 1 2 3 4 5 6 7
Advanced Components Product Portfolio Military Gear Protective Helmets Law Enforcement Protective Cases Automotive Interior Trim 11
Growth Strategy 12 Internal Growth: Market To Our Sweet Spot Strategic Acquisitions TWO - PRONGED
13 Organic Growth Opportunity Focus on high growth niche segments (MedTech – approximately 85% of revenue and growing) » Single - use, single - patient » Customer funded development Market to our sweet spot and differentiated capabilities » Leverage technology differentiation » Engineering resources » Exclusive access to specialty materials » Scale (footprint, clean room manufacturing) Expand business with existing customers » Offer complementary products and services » Additional value - add services
14 Acquisition Growth Opportunity Continue to Focus on Higher - Growth, Higher - Margin Medical Opportunities that Create Value » Become more valuable to our customers » Strategic focus – new capability, geography, market penetration, materials, products » Add scale / market share » Look for synergistic opportunities » Cultural fit Goal is for acquisitions to be accretive within the first year. Experienced and disciplined management team with 14 acquisitions completed
International Footprint 15 Galway, Ireland » Cleanroom manufacturing » Catheter & guidewire dispensers » Finished devices Tijuana, Mexico » Cleanroom manufacturing » MedSurg mattresses » Catheter & guidewire dispensers Costa Rica » Cleanroom manufacturing » Catheter & guidewire dispensers » Finished devices Dominican Republic » Robotic surgery drapes » Equipment drapes » Fluid warming basins New Locations
Why Invest? 16 Significant market growth opportunities Barriers to entry Strong customer relationships Experienced management team Proven growth strategy Attractive financial metrics
17 Significant Market Growth Opportunities » Medical device development » Medical device manufacturing » Medical components » Medical packaging Addressable market is growing Universe of specialty materials growing
Barriers To Entry » Advanced systems (extensive quality certifications) » In addition to existing equipment, engineers will design product specific innovations in order to meet customer needs Systems » In - house custom equipment manufacturing capabilities Custom Equipment » 20 patents relating to foam, packaging, tool control, radio frequency welding, automotive super - forming processes, and other products Intellectual Property » Global footprint – competition is generally smaller companies that have limited resources and access to materials Scale » Veteran engineering team for product design and development; more than 90 members of the engineering group Engineering Resources » Offers broad array of materials to meet customer needs » Almost 60 years in business and strong supplier relationships » Exclusive access to several specialty medical grade materials Greater Access to Materials 18
Management Team 19 Chris Litterio SVP, Human Resources & General Counsel Former Managing Partner and head of employment law at a major Boston law firm; 5 - years at the company Steve Cardin VP & COO, MedTech 27 years in the medical device industry; 3 - years at the company Jason Holt CCO, MedTech / VP & GM, Advanced Components Former VP & GM at ITW; 4 - years at the company R. Jeffrey Bailly Chairman, CEO & President 34 - year history at the company Ronald Lataille CFO, Sr. VP & Treasurer 25 - year history at the company Mitchell Rock President, MedTech 29 - year history at the company.
Proven Growth Strategy 20 Creating Shareholder Value
Financial Targets 21
Financial Targets 22 3 to 5 Year Financial Targets 10 - 15% Revenue Growth 27 - 30% Gross Margin 12 - 15% Operating Margin
10% to 15% Targeted Revenue Growth Internal Growth + Acquisitions $0 $50 $100 $150 $200 $250 $300 $350 $400 2017 2018 2019 2020 2021 2022 23 Revenue
Gross Margin Target – 27% to 30% Operating Leverage from Mix Shift + Acquisition synergies + Efficiencies 24 Gross Profit Margin 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 2017 2018 2019 2020 2021 2022 Target: 27 - 30%
Operating Margin Target - 12% to 15% Operating leverage from mix shift + acquisition synergies + efficiencies 25 Adjusted* Operating Margin -1.0% 1.0% 3.0% 5.0% 7.0% 9.0% 11.0% 13.0% 15.0% 2017 2018 2019 2020 2021 2022 Target: 12 - 15% *See non - GAAP reconciliation on slide 29
Growing Book Value 26 $1.10 $1.26 $1.93 $2.63 $1.77 $2.09 $5.45 $10.00 $12.00 $14.00 $16.00 $18.00 $20.00 $22.00 $24.00 $26.00 $28.00 $30.00 2016 2017 2018 2019 2020 2021 2022 * EPS Book Value / Share Book Value EPS
UFP Historical Stock Performance 20 Years 27 *Measured as the percent increase from December 31, 2002 through December 31, 2022. Ϭ й ϭϭϬϬ й ϮϮϬϬ й ϯϯϬϬ й ϰϰϬϬ й ϱϱϬϬ й ϲϲϬϬ й ϳϳϬϬ й ϴϴϬϬ й ϵϵϬϬ й ϭϭϬϬϬ й ĞĐ Ͳ ϬϮ ĞĐ Ͳ Ϭϰ ĞĐ Ͳ Ϭϲ ĞĐ Ͳ Ϭϴ ĞĐ Ͳ ϭϬ ĞĐ Ͳ ϭϮ ĞĐ Ͳ ϭϰ ĞĐ Ͳ ϭϲ ĞĐ Ͳ ϭϴ ĞĐ Ͳ ϮϬ ĞĐ Ͳ ϮϮ h&WdĞĐŚŶŽůŽŐŝĞƐ/ŶĐ ; h&Wd Ϳ WƌŝĐĞ й ŚĂŶŐĞ ZƵƐƐĞůů ϮϬϬϬ ; Δ Zhd Ϳ >ĞǀĞů й ŚĂŶŐĞ ^ Θ W ϱϬϬ ; Δ ^Wy Ϳ >ĞǀĞů й ŚĂŶŐĞ ϯϲϬ й ϯϲϬ й ϭϭ ͕ ϰϱϴ й
R. Jeffrey Bailly Chairman, CEO & President Newburyport, Massachusetts Ronald Lataille CFO, Sr. VP & Treasurer Newburyport, Massachusetts UFP Technologies 100 Hale St. Newburyport, MA 01950 978 - 352 - 2200 investorinfo@ufpt.com www.ufpt.com
Appendix Reconciliation of Non - GAAP Results (in Millions) 2017 2018 2019 2020 2021 2022 Revenue, As Reported $ 147.8 $ 190.5 $ 198.4 $ 179.4 $ 206.3 $ 354.0 Operating Income, as reported 11.7 19.6 24.7 16.7 21.2 55.4 Add: Acquisition/ Restructuring related Costs 0.1 1.1 - - 0.4 1.0 Add earnout fair value adjustment - - - - - 9.8 Less: Material overcharge Settlement (0.1) (0.1) - - - - Less: Gain or Add: Loss on Sale of fixed assets - - - 0.5 0 (6.1) Less: Sale of MFT (15.6) Adjusted Operating Income $ 11.7 $ 20.6 $ 24.7 $ 17.2 $ 21.6 $ 44.5 Adjusted Operating Margin 7.9% 10.8% 12.4% 9.6% 10.5% 12.6% 29