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Mity Enterprises Inc. (MITY) |
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CEOCFO Current
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MITY
Enterprise has shown innovation in a traditional market by developing the first
light-weight plastic table and an even more light-weight and durable next generation table MITY Enterprises designs, manufactures
and markets innovative institutional furniture consisting of multipurpose room furniture
and healthcare seating. The Company's multipurpose room furniture is manufactured and
marketed through its wholly owned subsidiary, Mity-Lite, Inc. These products consist of
lightweight, durable, folding leg tables, stacking chairs, folding chairs, lecterns and
other related products used in multipurpose rooms. Through its wholly owned subsidiary,
Broda Enterprises, Inc., the Company designs, manufactures and markets healthcare seating
and accessories used in long term healthcare facilities located primarily in the United
States and Canada.“We attract new and repeat business,”
Mr. Paul Killpack, CFO of MITY Enterprises tells us.
“In fact, more than half of our business is repeat
business. What happens is that an entity will have thirty or forty tables and some of them
will need replacing so they will transition over to our tables by ordering a dozen or so
up-front and then continue to order until they replace them all. We offer a twelve-year
warranty on our tables and so we believe that they will be a long-term solution for our
customers. Another unique way that we go about approaching the market is through a direct
sales force calling over the phone. Most of the other competitors are going through
dealers or distributors and sacrificing margin or in the end having to charge a higher
price than us. Because we are dealing directly with the customer, we are able to capture
more of that margin as well as be more price sensitive than what the competitors are able
to do.” The Mity-Lite brand is well known. Mr.
Killpack explains, “Brand name is very important because
we were the first to market with the table. The Mity-Lite name immediately describes the
product to the customers to the point where it is a brand image of a classic light weight
table. We have heard of situation where some customers said “I got some of those
Mity-Lite tables from XYZ Company,” which is a competitor of ours, and we had to say
“no, that table is ours.” Broda Enterprises has been a good
addition to MITY. “We purchased Broda Enterprises in
November of 1998. They are located in Waterloo, Ontario Canada, northwest of Toronto. What
attracted us to them is that they are a niche player. They have a wheelchair that is
unique and used in special situations, where the patient has a disease or disability that
confines them to bed. This wheelchair allows them a lot more maneuverability particularly
by the caregiver. The chair has straps to allow their skin to breathe so that they can
avoid getting bedsores. It allows more mobility to the patient. At the time that we
acquired them, about two-thirds of their sales were in Canada, and a third in the U.S.
Much of our focus has been largely to penetrate into the U.S. to the point now where there
is a 60/40 split, with 60% of their sales being in the U.S., and 40% in Canada. There
still is a tremendous growth opportunity in the United States. Their chairs are different
than others out there, and in specific applications, those are the chairs that the
customer needs and wants. There are not a lot of other possibilities out there, so they
are able to command a high price and have been very successful,” Mr. Killpack
explains. “MITY is a small public company, but our growth
has consistently outpaced the industry throughout our history, states Mr. Killpack.
In an industry where there are not a lot of interesting and new things going on, we have
been innovative. We introduced the plastic table and we are getting ready to introduce a
new generation of plastic tables. We have a folding chair with six patents and we are
focusing on continuing to develop new products to challenge existing products. In an
industry that traditionally has been not nearly as growth oriented, we have a focus on
that growth. Because of the market that we focus on, we are able to command higher
margins. We typically have a 15-20% operating margin, where others in our industry
typically are often in the single digits or just over 10% yielding a real opportunity
there for investors.” The Company's strategy for future growth includes
continued penetration into the domestic and international niche markets, introducing
complementary products such as stacking and folding chairs, staging, and partitions into
its existing distribution system, as well as acquiring synergistic businesses, and cost
effectively enhancing its manufacturing process. Headquartered in Utah, MITY Enterprises,
Inc. serves national and international customers directly and through distributors.
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