A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z | |
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1 | Rocky Brands ($RCKY) LBO Model | |||||||||||||||||||||||||
2 | ($ in Millions) | |||||||||||||||||||||||||
3 | ||||||||||||||||||||||||||
4 | x | Assumptions | x | Income Statement | ||||||||||||||||||||||
5 | General: | Growth: | 2014A | 2015A | 2016A | 2017E | 2018E | 2019E | 2020E | 2021E | ||||||||||||||||
6 | Days | 365 | Wholesale | 4.0% | Wholesale | $233.9 | $206.1 | $176.9 | $184.0 | $191.4 | $199.0 | $207.0 | $215.3 | |||||||||||||
7 | Tax Rate | 26.0% | Retail | 1.0% | % Growth | -11.9% | -14.1% | 4.0% | 4.0% | 4.0% | 4.0% | 4.0% | ||||||||||||||
8 | CIRC | 0 | Military | 5.0% | ||||||||||||||||||||||
9 | Transaction Fees | 2.0% | Retail | $44.3 | $45.8 | $45.9 | $46.4 | $46.9 | $47.3 | $47.8 | $48.3 | |||||||||||||||
10 | Legal Fees | 1.0% | Cost: | % Growth | 3.3% | 0.3% | 1.0% | 1.0% | 1.0% | 1.0% | 1.0% | |||||||||||||||
11 | Financing Fees | 0.5% | Gross Margin Improvement | 0.3% | ||||||||||||||||||||||
12 | Cash Interest | 1.0% | SGA Improvement | 0.5% | Military | $8.0 | $17.4 | $37.4 | $39.3 | $41.2 | $43.3 | $45.4 | $47.7 | |||||||||||||
13 | Minimum Cash | $3.0 | % Growth | 117.9% | 114.6% | 5.0% | 5.0% | 5.0% | 5.0% | 5.0% | ||||||||||||||||
14 | Amortization of Financing Fees | 5 Years | ||||||||||||||||||||||||
15 | Exit Multiple | 21.0x | Total Revenue | $286.2 | $269.3 | $260.3 | $269.7 | $279.5 | $289.6 | $300.2 | $311.3 | |||||||||||||||
16 | Exit Year | 2021 | ||||||||||||||||||||||||
17 | Hold Period | 5 Years | COGS | $189.9 | $180.4 | $183.5 | $189.4 | $195.4 | $201.6 | $208.1 | $214.8 | |||||||||||||||
18 | ||||||||||||||||||||||||||
19 | x | Purchase Price | Gross Profit | $96.4 | $88.9 | $76.7 | $80.3 | $84.1 | $88.0 | $92.1 | $96.4 | |||||||||||||||
20 | Current Stock Price | $21.00 | % Margin | 33.7% | 33.0% | 29.5% | 29.8% | 30.1% | 30.4% | 30.7% | 31.0% | |||||||||||||||
21 | Premium | 15.00% | ||||||||||||||||||||||||
22 | Offer Price | $24.15 | Operating Expenses | $80.6 | $78.4 | $75.6 | $77.0 | $78.4 | $79.8 | $81.2 | $82.7 | |||||||||||||||
23 | Basic Shares | 7.44 | % Margin | 28.2% | 29.1% | 29.1% | 28.6% | 28.1% | 27.6% | 27.1% | 26.6% | |||||||||||||||
24 | Add'l Diluted Shares | 0.04 | ||||||||||||||||||||||||
25 | Equity Value | $180.5 | EBIT | $15.8 | $10.5 | $1.1 | $3.3 | $5.7 | $8.2 | $10.9 | $13.8 | |||||||||||||||
26 | Less: Cash | (4.5) | ||||||||||||||||||||||||
27 | Plus: Debt | 14.6 | Interest Expense | ($0.9) | ($0.7) | ($0.6) | $0.0 | $0.0 | $0.0 | $0.0 | $0.0 | |||||||||||||||
28 | Enterprise Value | $190.6 | ||||||||||||||||||||||||
29 | Other | ($0.1) | ($0.1) | $0.1 | $0.0 | $0.0 | $0.0 | $0.0 | $0.0 | |||||||||||||||||
30 | Implied Entry Multiple | 21.6x | ||||||||||||||||||||||||
31 | EBT | $14.7 | $9.7 | $0.5 | $3.3 | $5.7 | $8.2 | $10.9 | $13.8 | |||||||||||||||||
32 | Returns: | |||||||||||||||||||||||||
33 | MOIC | 3.24x | Tax | ($0.9) | ($1.5) | ($2.1) | ($2.8) | ($3.6) | ||||||||||||||||||
34 | IRR | 26.5% | ||||||||||||||||||||||||
35 | Net Income | $2.4 | $4.2 | $6.0 | $8.0 | $10.2 | ||||||||||||||||||||
36 | x | Dilution Schedule | ||||||||||||||||||||||||
37 | Shares | Strike Price | Shares ITM | Share Proceeds | Shares Repurch. | Net Shares | D&A | $6.9 | $7.2 | $7.7 | $8.0 | $8.3 | $8.6 | $8.9 | $9.2 | |||||||||||
38 | Options 1 | 0.04 | $12.85 | 0.04 | $0.55 | 0.02 | 0.02 | % Margin | 2.4% | 2.7% | 3.0% | 3.0% | 3.0% | 3.0% | 3.0% | 3.0% | ||||||||||
39 | Options 2 | 0.04 | $12.60 | 0.04 | $0.45 | 0.02 | 0.02 | |||||||||||||||||||
40 | Total | 0.04 | Capex | $7.4 | $8.7 | $5.9 | $6.1 | $6.3 | $6.6 | $6.8 | $7.1 | |||||||||||||||
41 | % Margin | 2.6% | 3.2% | 2.3% | 2.3% | 2.3% | 2.3% | 2.3% | 2.3% | |||||||||||||||||
42 | x | Financing Assumptions | ||||||||||||||||||||||||
43 | Multiple | Amount | Interest Rate | Amortization | EBITDA | $22.7 | $17.7 | $8.8 | $11.3 | $13.9 | $16.8 | $19.8 | $23.0 | |||||||||||||
44 | Revolver | 0.0x | $0.0 | 3.0% | ||||||||||||||||||||||
45 | Term Loan | 3.0x | $26.5 | 5.0% | 1.0% | x | Balance Sheet | |||||||||||||||||||
46 | Senior Notes | 4.0x | $35.3 | 7.0% | 2015A | 2016A | Debit | Credit | PF 2016 | 2017E | 2018E | 2019E | 2020E | 2021E | ||||||||||||
47 | Total | 7.0x | $61.7 | Cash | $3.4 | $4.5 | $3.0 | ($4.5) | $3.0 | $3.0 | $3.0 | $3.0 | $3.0 | $3.0 | ||||||||||||
48 | Accounts Receivable | 45.3 | 42.8 | 42.8 | 44.3 | 45.9 | 47.6 | 49.3 | 51.2 | |||||||||||||||||
49 | x | Sources & Uses | Inventories | 77.0 | 69.2 | 69.2 | 71.4 | 73.6 | 76.0 | 78.4 | 81.0 | |||||||||||||||
50 | Sources | Deferred Income Tax | 1.0 | 1.6 | 1.6 | 1.7 | 1.8 | 1.8 | 1.9 | 2.0 | ||||||||||||||||
51 | Cash from Balance Sheet | $4.5 | Prepaid Expenses | 2.5 | 2.4 | 2.4 | 2.4 | 2.5 | 2.6 | 2.7 | 2.8 | |||||||||||||||
52 | Revolver | 0.0 | Total Current Assets | $129.2 | $120.4 | $118.9 | $122.8 | $126.9 | $131.0 | $135.4 | $139.9 | |||||||||||||||
53 | Term Loan | 26.5 | New Goodwill | $45.4 | $45.4 | $45.4 | $45.4 | $45.4 | $45.4 | $45.4 | ||||||||||||||||
54 | Senior Notes | 35.3 | Plant, Property & Equipment | 27.8 | 26.5 | 26.5 | 24.6 | 22.7 | 20.7 | 18.6 | 16.4 | |||||||||||||||
55 | Sponsor Equity | 138.5 | Intangibles | 36.5 | 33.4 | 33.4 | 33.4 | 33.4 | 33.4 | 33.4 | 33.4 | |||||||||||||||
56 | Total Sources | $204.7 | Other Assets | 0.3 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | |||||||||||||||
57 | Financing fees | 1.0 | 1.0 | 0.8 | 0.6 | 0.4 | 0.2 | 0.0 | ||||||||||||||||||
58 | x | Uses | Total Assets | $193.9 | $180.6 | $225.4 | $227.2 | $229.1 | $231.1 | $233.2 | $235.3 | |||||||||||||||
59 | Purchase of Equity | $180.5 | ||||||||||||||||||||||||
60 | Retire Debt | 14.6 | Accounts Payable | $9.1 | $11.6 | $11.6 | $12.0 | $12.3 | $12.7 | $13.1 | $13.6 | |||||||||||||||
61 | Transaction Fees | 3.8 | Accrued Expenses | 5.6 | 6.1 | 6.1 | 6.4 | 6.6 | 6.8 | 7.1 | 7.3 | |||||||||||||||
62 | Legal Fees | 1.9 | Total Current Liabilities | $14.7 | $17.7 | $17.7 | $18.3 | $18.9 | $19.6 | $20.2 | $20.9 | |||||||||||||||
63 | Financing Fees | 1.0 | Long-Term Debt | 23.7 | 14.6 | (14.6) | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||||
64 | Minimum Cash | 3.0 | Revolver | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||||||
65 | Total Uses | $204.7 | Term Loan | 26.5 | 26.5 | 25.2 | 22.3 | 17.6 | 11.0 | 2.3 | ||||||||||||||||
66 | Senior Notes | 35.3 | 35.3 | 35.3 | 35.3 | 35.3 | 35.3 | 35.3 | ||||||||||||||||||
67 | Purchase Price Allocation | Deferred Income Tax | 13.0 | 13.0 | 13.0 | 13.0 | 13.0 | 13.0 | 13.0 | 13.0 | ||||||||||||||||
68 | Purchase Price | $180.5 | Other Deferred Liabilities | 0.3 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | |||||||||||||||
69 | Less: Book Value | (135.1) | Total Liabilities | $51.7 | $45.5 | $92.6 | $92.0 | $89.7 | $85.6 | $79.7 | $71.6 | |||||||||||||||
70 | Plus: Existing Goodwill | 0.0 | ||||||||||||||||||||||||
71 | New Goodwill | $45.4 | Shareholders Equity | $142.1 | $135.1 | $132.8 | ($135.1) | $132.8 | $135.2 | $139.4 | $145.4 | $153.5 | $163.7 | |||||||||||||
72 | ||||||||||||||||||||||||||
73 | Total Liabilities & Shareholders Equity | $193.9 | $180.6 | $225.4 | $227.2 | $229.1 | $231.1 | $233.2 | $235.3 | |||||||||||||||||
74 | ||||||||||||||||||||||||||
75 | Check | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||||||||||||
76 | ||||||||||||||||||||||||||
77 | B/S Assumptions | 2015A | 2016A | 2017E | 2018E | 2019E | 2020E | 2021E | ||||||||||||||||||
78 | A/R Days | 61 | 60 | 60 | 60 | 60 | 60 | 60 | ||||||||||||||||||
79 | Inventory Days | 156 | 138 | 138 | 138 | 138 | 138 | 138 | ||||||||||||||||||
80 | Deferred Income Tax % | 0.4% | 0.6% | 0.6% | 0.6% | 0.6% | 0.6% | 0.6% | ||||||||||||||||||
81 | Prepaid Expenses % | 0.9% | 0.9% | 0.9% | 0.9% | 0.9% | 0.9% | 0.9% | ||||||||||||||||||
82 | DPO | 18 | 23 | 23 | 23 | 23 | 23 | 23 | ||||||||||||||||||
83 | Accrued Expenses % | 2.1% | 2.4% | 2.4% | 2.4% | 2.4% | 2.4% | 2.4% | ||||||||||||||||||
84 | ||||||||||||||||||||||||||
85 | x | Cash Flow Statement | ||||||||||||||||||||||||
86 | 2017E | 2018E | 2019E | 2020E | 2021E | |||||||||||||||||||||
87 | Net Income | $2.4 | $4.2 | $6.0 | $8.0 | $10.2 | ||||||||||||||||||||
88 | D&A | 8.0 | 8.3 | 8.6 | 8.9 | 9.2 | ||||||||||||||||||||
89 | Amort of Debt Financing Fees | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 | ||||||||||||||||||||
90 | Change in Accounts Receivable | (1.5) | (1.6) | (1.7) | (1.7) | (1.8) | ||||||||||||||||||||
91 | Change in Inventories | (2.2) | (2.3) | (2.4) | (2.4) | (2.5) | ||||||||||||||||||||
92 | Change in Deferred Income Tax | (0.1) | (0.1) | (0.1) | (0.1) | (0.1) | ||||||||||||||||||||
93 | Change in Prepaid Expenses | (0.1) | (0.1) | (0.1) | (0.1) | (0.1) | ||||||||||||||||||||
94 | Accounts Payable | 0.4 | 0.4 | 0.4 | 0.4 | 0.4 | ||||||||||||||||||||
95 | Accrued Expenses | 0.2 | 0.2 | 0.2 | 0.2 | 0.3 | ||||||||||||||||||||
96 | Cash Flow from Operations | $7.3 | $9.2 | $11.3 | $13.5 | $15.8 | ||||||||||||||||||||
97 | ||||||||||||||||||||||||||
98 | Capex | (6.1) | (6.3) | (6.6) | (6.8) | (7.1) | ||||||||||||||||||||
99 | Cash Flow from Investing Activities | ($6.1) | ($6.3) | ($6.6) | ($6.8) | ($7.1) | ||||||||||||||||||||
100 |