©2016 Matthews International Corporation. All Rights Reserved.
INVESTOR PRESENTATION
4th QUARTER FISCAL 2016
Exhibit 99.1
©2016 Matthews International Corporation. All Rights Reserved.
Business Overview
2
©2016 Matthews International Corporation. All Rights Reserved.
Disclaimer
Any forward-looking statements with respect to Matthews International Corporation (the “Company”) in connection with this discussion are being made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks and uncertainties that may cause the Company’s actual results in future periods to be
materially different from management’s expectations. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that
such expectations will prove correct. Factors that could cause the Company’s results to differ from those discussed today are set forth in the Company’s Annual Report on Form 10-K and other periodic
filings with the Securities and Exchange Commission (“SEC”).
The Company periodically provides information derived from consolidated financial data which is not presented in the consolidated financial statements prepared in accordance with U.S. generally accepted
accounting principles (“GAAP”). Certain of this information are considered “non-GAAP financial measures” under the SEC rules. The Company believes that this information provides management and
investors with a useful measure of the Company’s financial performance on a comparable basis. These non-GAAP financial measures are supplemental to the Company’s GAAP disclosures and should
not be considered an alternative to the GAAP financial information.
The Company uses non-GAAP financial measures to assist in comparing its performance on a consistent basis for purposes of business decision making by removing the impact of certain items that
management believes do not directly reflect the Company’s core operations including acquisition-related items, adjustments related to intangible assets, litigation items, and strategic initiative and other
charges, which includes non-recurring charges related to operational initiatives and exit activities. Management believes that presenting non-GAAP financial measures is useful to investors because it (i)
provides investors with meaningful supplemental information regarding financial performance by excluding certain items, (ii) permits investors to view performance using the same tools that management
uses to budget, forecast, make operating and strategic decisions, and evaluate historical performance, and (iii) otherwise provides supplemental information that may be useful to investors in evaluating the
Company’s results. The Company believes that the presentation of these non-GAAP financial measures, when considered together with the corresponding GAAP financial measures and the reconciliations
to those measures, provided herein, provides investors with an additional understanding of the factors and trends affecting the Company’s business that could not be obtained absent these disclosures.
The Company has presented adjusted free cash flow as supplemental measures of cash flow that is not required by, or presented in accordance with, GAAP. Management believes that adjusted free cash
flow provides relevant and useful information, which is widely used by analysts and investors as well as by our management. Adjusted free cash flow provides management with insight on the cash
generated by operations, excluding certain expenses, above and beyond the annual capital expenditures. This measure allows management, as well as analysts and investors, to assess the Company’s
ability to pursue growth and investment opportunities designed to increase Shareholder value.
The Company also has presented adjusted operating profit and believes that it provides relevant and useful information, which is widely used by analysts and investors, as well as by the Company’s
management in assessing both consolidated and segment performance. Adjusted operating profit provides the Company with an understanding of the results from the primary operations of its business by
excluding the effects of certain acquisition costs and items that do not reflect the ordinary earnings of the Company’s operations. This measure may be useful to an investor in evaluating the underlying
primary operating performance of the Company’s segments and business overall on a consistent basis.
Similarly, the Company believes that EBITDA and adjusted EBITDA provide relevant and useful information, which is widely used by analysts and investors, as well as by the Company’s management in
assessing the performance of its business. Adjusted EBITDA provides the Company with an understanding of earnings before the impact of investing and financing charges and income taxes, and the
effects of certain acquisition costs and items that do not reflect the ordinary earnings of the Company’s operations. This measure may be useful to an investor in evaluating operating performance. It is also
useful as a financial measure for lenders and is used by the Company’s management to measure performance as well as strategic planning and forecasting.
The Company has also presented adjusted earnings per share and believes it provides relevant and useful information, which is widely used by analysts and investors, as well as by the Company’s
management in assessing the performance of its business. Adjusted earnings per share provides the Company with an understanding of the results from the primary operations of our business by excluding
the per share effects of certain acquisition costs and items that do not reflect the ordinary earnings of our operations. This measure provides management with insight into the earning value for shareholders
excluding certain costs, not related to the Company’s primary operations. Likewise, this measure may be useful to an investor in evaluating the underlying operating performance of the Company’s business
overall, as well as performance trends, on a consistent basis.
Lastly, the Company has presented adjusted net income and believes it provides relevant and useful information, which is widely used by analysts and investors, as well as by the Company’s management
in assessing financial performance. Adjusted net income provides the Company with an understanding of the results from the primary operations of its business by excluding the effects of certain acquisition
costs and items that do not reflect the ordinary earnings of the Company’s operations. This measure may be useful to an investor in evaluating the underlying performance of the business.
3
©2016 Matthews International Corporation. All Rights Reserved.
Matthews
Founded in 1850 – headquartered in Pittsburgh, PA
Three business segments:
SGK Brand Solutions
Memorialization
Industrial Technologies
Over 10,000 employees
Over 25 countries
NASDAQ – 32.1 million shares outstanding, as of Sept. 30, 2016
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©2016 Matthews International Corporation. All Rights Reserved.
51%
8%
41%
Memorialization
SGK Brand Solutions
Industrial Technologies
5
Fiscal 2016 Sales
©2016 Matthews International Corporation. All Rights Reserved.
SGK BRAND SOLUTIONS
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©2016 Matthews International Corporation. All Rights Reserved.
SGK Brand Solutions
7
Brand
Development
Brand
Deployment
Create
Brand
Performance
Improved top-
line growth
Activate Improved
bottom-line
performance
= + Premedia
Tooling
Merchandising
Delivering Brand Performance
©2016 Matthews International Corporation. All Rights Reserved.
SGK Brand Solutions
8
The full U.K. packaging portfolio for Kit Kat was redesigned by
Anthem, a global creative agency that is part of the brand
development business of the SGK Brand Solutions segment.
The SGK Brand Solutions segment produces
gravure printing and embossing tools used in
the packaging, wallpaper and tobacco
industries.
iDL Worldwide, a brand services firm within the SGK
Brand Solutions segment, brought Sunglass Hut’s “Punk-
It-Up!” campaign to life with this pop-up experience in
New York City.
©2016 Matthews International Corporation. All Rights Reserved.
MEMORIALIZATION
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©2016 Matthews International Corporation. All Rights Reserved. 10
Building signs are
an example of the
segment’s
architectural
product offerings.
Memorialization
Matthews is well known for
its heritage of creating
beautiful, time-tested
bronze memorials.
The segment designs unique
glass-front niches to meet the
growing demand for cremation
memorialization.
©2016 Matthews International Corporation. All Rights Reserved. 11
Memorialization
The Company is a leading manufacturer and distributor of caskets
(wood, metal and cremation) in North America.
The Super Power Pak III Plus cremation unit has some of the most
advanced features in combustion technology as well as industry
leading performance, reliability and support.
©2016 Matthews International Corporation. All Rights Reserved. 12
Memorialization
Casketed Deaths vs. Total Deaths
Company estimates. Data compiled from CDC, US Census Bureau, Industry reports and internal projections.
©2016 Matthews International Corporation. All Rights Reserved.
INDUSTRIAL TECHNOLOGIES
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©2016 Matthews International Corporation. All Rights Reserved. 14
Industrial Technologies
Non-contact ink-jet printing units apply print on products.
Driven by sophisticated automation software and controls,
multiple integrated distribution and fulfillment systems (including
laser-based identification and dimensioning technologies)
communicate in a warehouse to identify and route items and
parcels through the facility and out to a customer.
Pick-to-Light systems use light indicators
for sorting and control of merchandise.
©2016 Matthews International Corporation. All Rights Reserved.
Financial Overview
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©2016 Matthews International Corporation. All Rights Reserved.
Key Elements of Long-Term EPS Growth
Internal Growth
Expand market presence of existing products
Manufacturing/cost structure improvements
New product development
Acquisitions
Primary objective to support strategic business plans
Achieve long-term annual return (EBITDA) of 15% on invested
capital
Share Repurchases
Repurchase in periods of excess cash flow
Current remaining authorization – 2.0 million shares
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©2016 Matthews International Corporation. All Rights Reserved.
Consolidated Results
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2014 2015 2016
Sales 1,106,597$ 1,426,068$ 1,480,464$
Operating Profit 81,522$ 105,023$ 118,815$
Adj. Operating Profit (a) 120,120$ 141,906$ 154,872$
EBITDA (b) 120,921$ 173,043$ 185,646$
Adj. EBITDA (c) 172,071$ 215,974$ 239,586$
EPS - GAAP 1.49$ 1.91$ 2.03$
Adj. EPS (d) 2.74$ 3.03$ 3.38$
(Dollars in thousands,
except per share data)
Fiscal year ended September 30,
(a) Adjusted operating profit reflects certain adjustments to facilitate comparability. See reconciliation at Appendix A.
(b) EBITDA represents earnings before interest expense, income taxes, depreciation and amortization. See reconciliation at
Appendix B.
(c) Adjusted EBITDA represents EBITDA plus stock compensation expense and the non-service cost portion of
pension/post-retirement expense, and also reflects certain adjustments to facilitate comparability. See reconciliation at
Appendix B.
(d) Adjusted earnings per share reflects certain adjustments to facilitate comparability and excludes intangible amortization
and the non-service cost portion of pension/post-retirement expense. See reconciliation at Appendix C.
©2016 Matthews International Corporation. All Rights Reserved.
Segment Results – Sales
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(Dollars in thousands)
2014 2015 2016
Sales:
SGK Brand Solutions 497,328$ 798,339$ 755,975$
Memorialization 508,420 508,058 610,142
Industrial Technologies 100,849 119,671 114,347
Consolidated 1,106,597$ 1,426,068$ 1,480,464$
Fiscal year ended September 30,
©2016 Matthews International Corporation. All Rights Reserved.
Segment Results – Operating Profit
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(Dollars in thousands)
2014 2015 2016
Operating Profit:
SGK Brand Solutions 2,536$ 21,864$ 42,909$
Memorialization 67,937 70,064 68,252
Industrial Technologies 11,049 13,095 7,654
Consolidated 81,522$ 105,023$ 118,815$
Adjusted Operating Profit:*
SGK Brand Solutions 33,932$ 61,327$ 67,901$
Memorialization 74,919 67,484 78,685
Industrial Technologies 11,269 13,095 8,286
Consolidated 120,120$ 141,906$ 154,872$
Fiscal year ended September 30,
* Adjusted operating profit reflects certain adjustments to facilitate comparability. See reconciliation at Appendix A.
.
©2016 Matthews International Corporation. All Rights Reserved.
Adjusted Free Cash Flow
20
(Dollars in thousands)
2014 2015 2016
Net Income 42,625$ 63,449$ 66,749$
Adjustments to Net Income
(1)
27,416 20,481 23,742
Adjusted Net Income 70,041 83,930 90,491
Depreciation and Amortization 42,864 62,620 65,480
Stock-Based Compensation 6,812 9,097 10,612
Pension Cost (non-service portion) 4,020 5,677 8,413
Subtotal 123,737 161,324 174,996
Capital Expenditures (29,237) (48,251) (41,682)
Adjusted Free Cash Flow
(2)
94,500$ 113,073$ 133,314$
Cash Provided from Operating Activities 90,679$ 141,064$ 140,274$
Fiscal year ended September 30,
(1) Adjusted net income reflects certain adjustments, net of tax, to facilitate comparability. See reconciliation at Appendix D.
(2) See Disclaimer (Page 3) for Management’s assessment of supplemental information related to adjusted free cash flow.
©2016 Matthews International Corporation. All Rights Reserved.
Earnings Per Share
21
Note: Adjusted earnings per share reflects certain adjustments to facilitate comparability and other adjustments. See reconciliation at Appendix C.
Earnings Per Share Adjusted Earnings Per Share
©2016 Matthews International Corporation. All Rights Reserved.
EBITDA
(Dollars in millions)
22
Note: EBITDA represents earnings before interest expense, income taxes, depreciation and amortization. See reconciliation at Appendix B. Adjusted
EBITDA represents EBITDA plus certain expenses, and also reflects certain adjustments to facilitate comparability. See reconciliation at Appendix B.
EBITDA Adjusted EBITDA
©2016 Matthews International Corporation. All Rights Reserved.
Common Stock Price
23
Note: Stock price obtained from NASDAQ for each respective month-end period.
©2016 Matthews International Corporation. All Rights Reserved.
Recent Highlights
Reported record sales of $1.48 billion in fiscal 2016
2016 GAAP EPS of $2.03; Adjusted EPS of $3.38, an increase of 11.6%
and a new record for the Company
Increased quarterly dividend 13.3% to 17.0 cents (November 2016)
22nd consecutive annual dividend increase since the Company’s IPO
Reported operating cash flow of $140.3 million in fiscal 2016
Sales of $462.3 million (31% of total) generated outside the U.S. in fiscal
2016
SGK and Aurora acquisition integrations progressing well
Analyst coverage:
CJS Securities (D. Moore)
Great Lakes Review (E. Schlang)
Macquarie Securities Group (J. Clement)
Wunderlich Securities (L. Burke)
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©2016 Matthews International Corporation. All Rights Reserved.
Institutional Shareholders
25
Shares
9/30/2016
Franklin Advisory Services, LLC 3,076,999
BlackRock Institutional Trust Company, N.A. 2,995,151
The Vanguard Group, Inc. 2,787,747
Wellington Management Company, LLP 1,429,727
Dimensional Fund Advisors, L.P. 1,330,422
T. Rowe Price Associates, Inc. 1,298,522
Clarkston Capital Partners, LLC 1,198,972
Fidelity Management & Research Company 964,899
Channing Capital Management, LLC 936,977
Emerald Advisers, Inc. 757,919
Top Ten Institutions 16,777,335 52% of outstanding shares
229 Institutions 9,516,330
Total Institutional Ownership 26,293,665 82% of outstanding shares
Note: Institutional share information obtained from NASDAQ as of September 30, 2016.
©2016 Matthews International Corporation. All Rights Reserved.
Appendices
26
©2016 Matthews International Corporation. All Rights Reserved.
Adjusted Operating Profit
Non-GAAP Reconciliation
27
Appendix A
(Dollars in thousands)
2014 2015 2016
SGK Brand Solutions
Operating Profit 2,536$ 21,864$ 42,909$
Acquisition-related items 28,214 33,605 24,872
Intangible asset w rite-offs - 4,842 -
Strategic initiative and other charges (1) 3,182 1,016 120
Adjusted Operating Profit 33,932$ 61,327$ 67,901$
Memorialization
Operating Profit 67,937$ 70,064$ 68,252$
Acquisition-related items 448 5,260 11,022
Litigation matter 3,027 (8,996) -
Strategic initiative and other charges (1) 3,507 1,156 (589)
Adjusted Operating Profit 74,919$ 67,484$ 78,685$
Industrial Technologies
Operating Profit 11,049$ 13,095$ 7,654$
Acquisition-related items - - -
Strategic initiative and other charges (1) 220 - 632
Adjusted Operating Profit 11,269$ 13,095$ 8,286$
Consolidated
Operating Profit 81,522$ 105,023$ 118,815$
Acquisition-related items 28,662 38,865 35,894
Intangible asset w rite-offs - 4,842 -
Litigation matter 3,027 (8,996) -
Strategic initiative and other charges (1) 6,909 2,172 163
Adjusted Operating Profit 120,120$ 141,906$ 154,872$
Fiscal year ended September 30,
Note: See Disclaimer (Page 3) for Management’s assessment of supplemental information related to adjusted operating profit.
(1) – See Disclosure (Page 3).
©2016 Matthews International Corporation. All Rights Reserved.
EBITDA and Adjusted EBITDA
Non-GAAP Reconciliation
28
Appendix B
(Dollars in thousands)
2014 2015 2016
Net Income 42,625$ 63,449$ 66,749$
Interest expense 12,628 20,610 24,344
Income taxes 22,805 26,364 29,073
Depreciation and Amortization 42,864 62,620 65,480
EBITDA 120,921$ 173,043$ 185,646$
Acquisition-related items 28,662 38,865 34,674
Intangible asset w rite-offs 4,842 -
Litigation matter 3,027 (8,996) -
Strategic initiative and other charges
(1)
8,629 4,968 241
Pension settlement - (11,522) -
Stock-based compensation 6,812 9,097 10,612
Pension and postretirement expense
(2)
4,020 5,677 8,413
Adjusted EBITDA 172,071$ 215,974$ 239,586$
Note: See Disclaimer (Page 3) for Management’s assessment of supplemental information related to EBITDA and adjusted EBITDA.
(1) See Disclosure (Page 3).
Fiscal year ended September 30,
(2) The non-GAAP adjustment to pension and postretirement expense represents the add-back of the non-service related components of these costs.
Non-service related components include interest cost, expected return on plan assets and amortization of actuarial gains and losses. The service cost
and prior service cost components of pension and postretirement expense are considered to be a better reflection of the ongoing service-related costs
of providing these benefits. The other components of GAAP pension and postretirement expense are primarily influenced by general market conditions
impacting investment returns and interest (discount) rates. Please note that GAAP pension and postretirement expense or the adjustment above are not
necessarily indicative of the current or future cash flow requirements related to these employee benefit plans.
©2016 Matthews International Corporation. All Rights Reserved.
Adjusted Earnings Per Share
Non-GAAP Reconciliation
29
Appendix C
2014 2015 2016
EPS - GAAP 1.49$ 1.91$ 2.03$
Acquisition-related items 0.71 0.79 0.74
Intangible asset w rite-offs 0.10 -
Litigation matter 0.07 (0.18) -
Strategic initiative and other charges
(1)
0.22 0.14 0.01
Pension settlement - (0.24) -
Theft and related costs - - -
Pension and postretirement expense
(2)
0.09 0.12 0.17
Intangible amortization expense 0.16 0.39 0.43
Adjusted EPS 2.74$ 3.03$ 3.38$
(1) See Disclosure (Page 3).
Fiscal year ended September 30,
Note: See Disclaimer (Page 3) for Management’s assessment of supplemental information related to adjusted earnings per share. All
per-share amounts are net of tax.
(2) The non-GAAP adjustment to pension and postretirement expense represents the add-back of the non-service related
components of these costs. Non-service related components include interest cost, expected return on plan assets and amortization
of actuarial gains and losses. The service cost and prior service cost components of pension and postretirement expense are
considered to be a better reflection of the ongoing service-related costs of providing these benefits. The other components of GAAP
pension and postretirement expense are primarily influenced by general market conditions impacting investment returns and interest
(discount) rates. Please note that GAAP pension and postretirement expense or the adjustment above are not necessarily indicative
of the current or future cash flow requirements related to these employee benefit plans.
©2016 Matthews International Corporation. All Rights Reserved.
Adjusted Net Income
Non-GAAP Reconciliation
30
Appendix D
(Dollars in thousands)
Pretax After Tax Pretax After Tax Pretax After Tax
Net Income 66,076$ 42,625$ 89,652$ 63,449$ 95,234$ 66,749$
Acquisition-related items 28,662 19,490 38,865 26,428 34,674 23,578
Intangible asset w rite-offs - - 4,842 3,293 - -
Litigation matter 3,027 2,058 (8,996) (6,117) - -
Strategic initiative and other charges
(1)
8,629 5,868 4,968 3,378 241 164
Pension settlement - - (11,522) (7,835) - -
Tax related - 1,334 -
Adjusted Net Income 70,041$ 83,930$ 90,491$
2016
Fiscal year ended September 30,
(1) See Disclosure (Page 3).
20152014
Note: See Disclaimer (Page 3) for Management’s assessment of supplemental information related to adjusted net income. Adjusted
net income reflects non-GAAP adjustments at an effective tax rate of 32.0%.