PACKAGING

INDUSTRY UPDATE FEBRUARY 2015

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PACKAGING
INDUSTRY UPDATE FEBRUARY 2015

PACKAGING INDUSTRY UPDATE

CONTENTS

INTRODUCTION
Harris Williams & Co. is pleased to present our packaging industry update for
February 2015. This report provides commentary and analysis on current capital
market trends and merger and acquisition dynamics within the global packaging
industry.
We hope you find this edition helpful and encourage you to contact us directly if
you would like to discuss our perspective on current industry trends or our relevant
industry experience.

WHAT WERE READING

ECONOMIC UPDATE
KEY THEMES
PUBLIC COMPARABLES
PUBLIC MARKETS
SELECT M&A ACTIVITY

OUR PRACTICE

CONTACTS

Harris Williams & Co. is a leading advisor to the packaging industry. Our significant
experience covers a broad range of end markets, industries, and business models.

Patrick McNulty
Managing Director
pmcnulty@harriswilliams.com
+1 (804) 932-1339

Packaging Types

Bags
Bottles & Cans
Caps & Closures
Flexible
Labels
Pouches
Rigid

Materials

Applications

Films
Foil
Laminations
Paperboard
Plastics
Specialty Paper

Cosmetics
E-Commerce
Food & Beverage
Healthcare
Industrial
Other

HARRIS WILLIAMS & CO. DEAL SPOTLIGHT

Packaging Dynamics
a portfolio company of

has been acquired by

Most recently, Harris Williams & Co. advised Packaging

Dynamics, a portfolio company of Kohlberg & Company, on
its sale to NOVOLEX, a portfolio company of Wind Point
Partners. Packaging Dynamics is a leading manufacturer of
flexible packaging solutions and specialty laminations.

Darwin Olympia
Director
dolympia@harriswilliams.com
+1 (804) 915-0141
Brad Morrison
Vice President
bmorrison@harriswilliams.com
+1 (804) 915-0168
Brandt Carr
Associate
bcarr@harriswilliams.com
+1 (804) 887-6018

Ranpak Corporation
a portfolio company of

has been acquired by

Harris Williams & Co. also recently advised Ranpak

Corporation (Ranpak), a portfolio company of Odyssey
Investment Partners, on its sale to Rhne Capital. Ranpak is a
manufacturer of protective packaging systems.

Hilex Poly
a portfolio company of

has been acquired by

The firm also advised Hilex Poly, a portfolio company of TPG

Growth, on its sale to Wind Point Partners. Hilex Poly is a
manufacturer of plastic bag and film products in North
America, operating the countrys largest closed-loop plastic
bag recycling facility.

www.harriswilliams.com

PAGE | 1

PACKAGING
INDUSTRY UPDATE FEBRUARY 2015

WHAT WERE READING

FROZEN FRUIT SALES SOAR AS SMOOTHIES GET POPULAR
The Wall Street Journal

2/3/2015

Demand for frozen fruits is soaring as smoothies are becoming more popular in the U.S. Dole Packaged Foods, the
largest seller of frozen fruit in the U.S., estimates that in 2014 about 60% of frozen fruit purchased went into smoothies,
up from about 21% in 2006. Frozen fruit sales have topped $1 billion annually, up 67% since 2010, according to Nielsen.
Cascadian Farm, a line of organic foods from cereal to frozen produce owned by General Mills Inc, is optimistic about
new packages that will be made of thicker plastic covered in shiny graphics, some that sit upright on shelves and
have resealable zippers.
Read the full article here.
THE CHIPOTLE EFFECT: WHY AMERICA IS OBSESSED WITH FAST CASUAL FOOD
Washington Post

2/2/2015

The market for fast casual food, which is almost but not quite fast food, has grown by 550% since 1999, more than ten
times the growth seen in the fast food industry over the same period, according to data from market research firm
Euromonitor. Chipotle and Panera, likely the best known purveyors of the category, have seen their sales quadruple
and triple, respectively, during that time. Panera has taken steps to be more environmentally friendly, including a
redesign of all of its packaging last year to promote recycling.
Read the full article here.
2014 A RECORD YEAR FOR PACKAGING M&A DEALS
Plastics News

1/28/2015

Last years merger and acquisition activity in the packaging sector reached a record level. Overall deal volume hit
$29.9 billion last year, up from $21.7 billion in 2013, $18.4 billion in 2012, and $28.4 billion in 2011. While lots of deals are
getting done, they also are for valuations not seen in several years. The average multiple for packaging transactions
was 7.4 times earnings before interest, taxes, depreciation and amortization in 2014. That multiple was 6.8 just the year
before and 7.0 in 2012.
Read the full article here.
RIGID PACKAGING OUTLOOK REMAINS STRONG
Packaging News

1/8/2015

One of the key factors behind the packaging industrys recent growth spurt has been the continued success of rigid
plastic manufacturers. The performance of this important industry sub-sector has been driven by a combination of
strong innovation and a growing number of consumer goods companies switching their products out of other
packaging materials and into rigid plastics. Demand for rigid plastics isnt expected to wane any time soon.
According to Smithers Pira, the global rigid plastic packaging industry is forecast to grow during the period 2013 - 2018
by 5.2% to $174 billion. Given the bullish projections, it would be no surprise to see similarly high levels of M&A activity.
Read the full article here.
ITS PLASTIC FOAM PACKAGING, NOT THE FOOD, THATS TO GO UNDER A NEW YORK RULE
New York Times

1/7/2015

Nearly two years after Mayor Michael Bloomberg first proposed banishing foam containers in his final State of the City
address, Mayor Bill de Blasio has pledged to complete the deed. Beginning on July 1, food establishments will be
barred from using plastic foam cups or containers, compelling purveyors of curbside cart fare and Chinese takeout,
among others, to find alternatives. The sale of packing peanuts within the city limits will also be prohibited, though
peanut-laden parcels can still be shipped to New Yorkers from elsewhere. New York will now be the largest city in the
country, following San Francisco, Seattle and Portland, Oregon, to prohibit the foam containers.
Read the full article here.
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PAGE | 2

PACKAGING
INDUSTRY UPDATE FEBRUARY 2015

ECONOMIC UPDATE
OIL PRICES

Global oil prices continued their decline in early 2015 as low demand
growth for oil in Europe and Asia, combined with increasing supplies in $150
Feb-15:
the United States and the Middle East, have driven prices down to the
$57.00
lowest levels since early 2009.
$100
The impact of the decline in prices could have a widespread effect
Feb-15:
on the global packaging industry. First, lower gas prices could boost $50
$52.99
discretionary spending from global consumers as they save money at
the pump. Additionally, falling prices could reduce input prices for
$0
many plastic packaging providers, potentially resulting in higher
05 06 07 08 09 10 11 12 13 14 15
profits for those who can capture additional margins.
WTI
Brent

GDP

U.S.

Real GDP increased by 0.6% in Q4 2014 (annual rate of 2.6%) led by

strong exports and personal consumption.

Even factoring in a dismal first quarter, full-year GDP in 2014 grew

2.4%, the best annual performance since 2010, and at an annual rate
of 4% over the last nine months.

EU-28

$200

Seasonally adjusted GDP in the EU-28 for Q4 2014 rose by 0.4% in Q4

2014, with 1.3% annualized growth.

3%
2%
1%
0%
(1%)
(2%)
(3%)
(4%)
(5%)

U.S.

110

EU-28

Industrial production increased by 0.1% from November to December

2014, led by durable consumer goods, intermediate goods, and
capital goods. Meanwhile, non-durable goods fell by 1.4%.

Q4-14:
0.6%

Q4-14:
0.4%

U.S.

120

Industrial production decreased by 0.1% from November to

December, although the manufacturing sector was notably better
than the headline number due to a 7.3% drop in utilities. Capacity
utilization decreased 0.3% in December to 79.7%.

GDP
(Quarter-Over-Quarter Growth)

05 06 07 08 09 10 11 12 13 14 15

INDUSTRIAL PRODUCTION INDEX

Oil Prices
(Price per Barrel)

Industrial Production Index

Dec-14:
106.5

100
Dec-14:
101.8

90
80
70

05 06 07 08 09 10 11 12 13 14 15
U.S.

CONSUMER SENTIMENT

The Consumer Sentiment Index was up 4.6 points in the January

reading to 98.2 for the highest level since January 2004. The
expectations component, up 5.0 points to 91.6, was also at its highest
level since January 2004 and reflects confidence in the outlook for
jobs and income.
The current conditions component, up 3.5 points to 108.3, was at its
highest level since January 2007. This gain points to ongoing
acceleration in consumer activity.

EU-28

100

EU-28

Consumer Sentiment Index

Jan-15:
98.2

90

80
70
60
50
05 06 07 08 09 10 12 13 14 15
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PAGE | 3

PACKAGING
INDUSTRY UPDATE FEBRUARY 2015

KEY THEMES
INPUT PRICES

With raw material costs often representing more than 50% of COGS,
packaging companies must aggressively manage input costs.

The packaging industry relies heavily on petrochemical feedstock,

causing significant input price volatility that is influenced by oil and
natural gas prices, as well as supply/demand dynamics domestically
and abroad.

A two-year streak of steady resin price increases has ended, as resin

prices have been on a downward trajectory recently along with the
price of oil.

Many experts expect the decline in oil, natural gas, and resin prices to
continue as oversupply persists along with continued tepid demand.

Pulp and paper is another critical raw material for the industry and one
that has experienced less price volatility over the past three years.

Key Material Price Trends

(Indexed)

200%
150%
100%
50%
0%

Crude Oil
PET

Nat Gas
LDPE

Pulp
HDPE

ENVIRONMENTAL & SUSTAINABILITY

Sustainability and recycling initiatives have become the new norm in

the industry, and we expect these trends to continue with a focus on
eco-friendly products.

$20

Companies are developing new ways to incorporate post-consumer,

recycled material as feedstock for making new products.

$16

Corporate responsibility and the eco-friendly angle sit well with todays
consumers.

$12

Recycling materials can reduce input costs and increase efficiency,

without compromising performance.

$8

Companies continue to find more ways to go green across substrates

and applications.

Green Packaging Demand

($ in billions)

$14.8

$8.3

$9.0

1998

2003

$10.8

$12.5

$4
$0

2008

2013

2018

ROBUST E-COMMERCE GROWTH

Rapid growth in e-commerce will boost demand for protective

packaging solutions and lead to continued steady growth.

The e-commerce market is projected to grow ~16% annually through

2017, substantially faster than overall retail sales.

An increasing number of online orders per shopping experience and

rising average order value are driving the industry growth trends.

Global E-Commerce Sales Projections

($ in billions)

$2,357

$2,500

$2,053

$2,000
$1,500

$1,771
$1,505

As a higher percentage of goods are purchased online and shipped

directly to consumers, packaging providers will need to adapt to the
evolving implications and role packaging plays in consumer $1,000
marketing.

$500
$0
2014

2015

2016

2017

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PAGE | 4

PACKAGING
INDUSTRY UPDATE FEBRUARY 2015

PUBLIC COMPARABLES
As of February 17, 2015 ($ in millions, except per share amounts)
Stock Performance

3 Year

Current

% of

Price

LTM High

Mkt Cap

TEV

Diversified / Specialty
Amcor Limited

$14.22

100.0%

$12,743

$15,767

(3.9%)

Sealed Air Corporation

46.65

99.4%

9,762

13,853

12.3%

Sonoco Products Co.

46.95

97.9%

4,754

5,846

Bemis Company, I nc.

47.11

99.2%

4,705

AptarGroup, I nc.

65.25

95.0%

Berry Plastics Group, I nc.

34.77

Huhtamaki Oyj

Free Cash

Revenue
CAGR

2014

Price / Earnings

TEV / EBITDA

Flow

Net Debt /

Conversion1

EBITDA

Revenue

EBITDA

$11,631

$1,403

12.1%

18.0x

17.2x

13.0x

11.0x

10.6x

78.5%

2.2x

7,747

1,115

14.4%

21.8x

19.0x

12.5x

11.9x

11.1x

86.1%

3.7x

3.5%

4,977

614

12.3%

17.6x

15.9x

9.4x

8.7x

8.2x

72.4%

1.8x

6,005

(6.5%)

4,464

599

13.4%

18.3x

17.0x

10.2x

9.9x

9.6x

68.5%

2.2x

4,224

4,665

3.8%

2,618

460

17.6%

22.8x

20.3x

10.2x

10.4x

9.8x

66.9%

1.0x

98.1%

4,131

7,906

3.0%

5,053

827

16.4%

20.3x

16.7x

11.2x

9.0x

8.7x

71.4%

4.5x

25.19

97.9%

2,974

3,344

5.3%

2,326

331

14.2%

16.9x

15.4x

11.3x

9.2x

8.5x

50.7%

0.9x

Greif, I nc.

41.67

73.7%

2,074

3,266

1.5%

4,257

468

11.0%

17.0x

NA

6.9x

7.3x

NA

58.7%

2.4x

Winpak Ltd.

36.53

96.1%

1,913

1,811

6.4%

786

149

18.9%

19.7x

17.9x

13.9x

9.8x

8.5x

65.5%

NM

Margin

2015E

2016P

LTM

2015E

2016P

Median

97.9%

3.5%

14.2%

18.3x

17.1x

11.2x

9.8x

9.1x

68.5%

2.2x

Mean

95.3%

2.8%

14.5%

19.2x

17.4x

11.0x

9.7x

9.4x

68.7%

2.3x

Labels
Av ery Dennison Corporation

$53.99

99.4%

$4,919

$5,841

2.9%

$6,354

$691

10.9%

16.4x

14.4x

8.4x

8.2x

7.7x

78.8%

1.3x

CCL I ndustries I nc.

130.06

96.4%

3,608

4,003

26.7%

2,581

422

16.3%

18.3x

16.6x

10.6x

9.4x

8.8x

69.8%

1.2x

64.14

96.7%

1,065

1,505

27.3%

797

141

17.8%

19.0x

15.6x

10.3x

9.5x

8.5x

79.6%

3.1x

Multi-Color Corp.
Median

96.7%

26.7%

16.3%

18.3x

15.6x

10.3x

9.4x

8.5x

78.8%

1.3x

Mean

97.5%

18.9%

15.0%

17.9x

15.5x

9.8x

9.0x

8.3x

76.1%

1.9x

Paper and Paperboard

I nternational Paper Company

$56.98

99.0%

$24,138

$33,828

0.2%

$26,168

$4,201

16.1%

14.9x

13.0x

9.1x

7.9x

7.6x

65.1%

2.3x

Rock-Tenn Company

70.30

99.6%

9,836

12,625

22.2%

9,978

1,564

15.7%

16.4x

15.8x

8.1x

7.8x

7.8x

63.8%

1.8x

MeadWestv aco Corporation

54.06

99.6%

9,041

11,725

2.7%

5,604

975

17.4%

24.8x

22.1x

12.6x

11.2x

10.6x

62.8%

2.6x

Packaging Corporation of America

82.22

99.1%

8,089

10,316

31.4%

5,917

1,151

19.5%

16.4x

14.7x

9.5x

8.5x

8.0x

78.2%

1.9x

Graphic Packaging Holding Company

15.44

95.7%

5,050

6,942

0.3%

4,240

711

16.8%

20.4x

17.6x

10.0x

9.1x

8.5x

71.0%

2.7x

KapStone Paper and Packaging Corporation

33.01

95.9%

3,169

4,187

36.7%

2,314

455

19.6%

15.6x

14.1x

9.6x

8.5x

8.0x

68.6%

2.2x

PH Glatfelter Co.

25.04

79.2%

1,064

1,420

4.0%

1,811

182

10.1%

14.1x

11.4x

8.2x

7.3x

6.4x

40.6%

2.0x

Median

99.0%

4.0%

16.8%

16.4x

14.7x

9.5x

8.5x

8.0x

65.1%

2.2x

Mean

95.4%

13.9%

16.4%

17.5x

15.5x

9.6x

8.6x

8.1x

64.3%

2.2x

Rigid
Ball Corporation

$74.39

99.2%

$10,194

$13,172

(0.5%)

$8,512

$1,216

14.3%

19.2x

17.3x

11.0x

11.0x

10.5x

67.4%

2.4x

5.48

90.9%

5,891

7,753

(3.2%)

3,838

869

22.6%

16.0x

15.1x

8.6x

9.4x

9.1x

61.8%

1.4x

Owens-I llinois, I nc.

26.04

74.0%

4,276

7,341

(2.5%)

6,820

1,257

18.4%

10.7x

9.4x

6.4x

6.3x

6.0x

65.7%

2.3x

Silgan Holdings I nc.

57.27

99.4%

3,620

4,996

3.5%

3,887

536

13.8%

17.3x

16.0x

9.5x

9.4x

9.0x

73.4%

2.6x

Rexam plc

Median

95.0%

(1.5%)

16.4%

16.6x

15.5x

9.0x

9.4x

9.1x

66.6%

2.4x

Mean

90.9%

(0.7%)

17.3%

15.8x

14.5x

8.9x

9.0x

8.7x

67.1%

2.2x

Overall Median

97.9%

3.5%

16.1%

17.6x

15.9x

10.0x

9.2x

8.5x

68.5%

2.2x

Overall Mean

94.8%

7.7%

15.6%

17.9x

16.0x

10.0x

9.2x

8.7x

68.1%

2.2x

1)

Free cash flow conversion defined as EBITDA less capital expenditures divided by EBITDA.

PAGE | 5

PACKAGING
INDUSTRY UPDATE FEBRUARY 2015

PUBLIC MARKETS
3-YEAR REVENUE CAGR (2011 2014)

3-YEAR EBITDA CAGR (2011 2014)

2.8%

Diversified / Specialty

13.9%

Paper and Paperboard

Rigid

6.0%

Diversified / Specialty

18.9%

Labels

22.5%

Labels

18.7%

Paper and Paperboard

(0.7%)

4.2%

Rigid

AVERAGE EBITDA MARGIN (2015E)

FREE CASH FLOW CONVERSION (2015E)

15.1%

Diversifie d / Spe cialty

16.5%

Labels

17.4%

Paper and Paperboard

1.9x

Labels

8.6x

2.2x

Paper and Paperboard

9.0x

Rigid

2.3x

Diversified / Specialty

9.0x

Paper and Paperboard

67.1%

NET DEBT / LTM EBITDA

9.7x

Labels

64.3%

Paper and Paperboard

Rigid

TOTAL ENTERPRISE VALUE / 2015E EBITDA

Diversified / Specialty

76.1%

Labels

15.2%

Rigid

68.7%

Diversified / Specialty

2.2x

Rigid

PUBLIC COMPARABLES (30-DAY ROLLING AVERAGE OF MEDIAN TEV / LTM EBITDA)

Median

12x
11x
10x

Current

3-Year

5-Year

Diversified / Specialty

11.2x

8.8x

7.8x

Labels

10.2x

8.6x

7.9x

Paper and Paperboard

9.5x

8.8x

7.2x

Rigid

9.0x

8.4x

7.9x

10.0x

8.8x

7.5x

Total Packaging

9x
8x
7x

6x
5x

4x
Feb-10

Feb-11
Diversified / Specialty

Feb-12
Labels

Feb-13

Feb-14

Paper and Paperboard

Feb-15
Rigid

PAGE | 6

PACKAGING
INDUSTRY UPDATE FEBRUARY 2015

SELECT M&A ACTIVITY

Date
1/26/2015

Target
MeadWestv aco
Corporation

12/29/2014 Charter NEX Films I nc.

Target Business Description

Acquirer

MeadWestv aco Corporation prov ides packaging solutions to

healthcare, beauty and personal care, food, bev erage, home and
garden, tobacco, and agricultural industries w orldw ide.

Rock-Tenn Company
(Merger)

Charter NEX Films I nc. engages in engineering, extruding, and

manufacturing monolayer, coextruded, and barrier blow n films for
packaging applications.

Pamplona Capital
Management LLP

12/23/2014 Constantia Flexibles Group Constantia Flexibles Group GmbH manufactures and sells v arious flexible Wendel
GmbH
packaging products in Europe, North and South America, Africa,
Australia, Asia, and Oceania.
12/10/2014 Tri-Delta Plastics, I nc.

Tri-Delta Plastics, I nc. designs, engineers, manufactures, and sells plastic

components to the packaging industry.

Pretium Packaging, LLC

11/24/2014 SI G Combibloc Group AG

SI G Combibloc Group AG manufactures and supplies carton packaging Onex Corporation

and filling machines for bev erage and food manufacturers w orldw ide.

11/12/2014 Clondalkin Group Holdings Clondalkin Group Holdings B.V., Specialist Packaging Div ision offers
B.V., Specialist Packaging specialty secondary packaging solutions for the pharmaceutical,
Div ision
health, and personal care industries.

Essentra plc

11/10/2014 Packaging Dynamics

Corporation

Packaging Dynamics Corporation manufactures a broad portfolio of

flexible, paper-based food packaging products, as w ell as a range of
specialty laminated foil-paper products.

NOVOLEX

9/16/2014

Pro Mach, I nc.

Pro Mach, I nc. designs, manufactures, and sells packaging and

processing products and solutions for a v ariety of end markets in the
U.S. and internationally.

AEA I nv estors LP

8/25/2014

Berlin Packaging, LLC

Berlin Packaging, LLC manufactures, imports, and distributes plastic,

glass, and metal containers and closures.

Oak Hill Capital Partners

8/13/2014

Ranpak Corporation

Ranpak Corporation produces and supplies paper packaging materials

and systems, offering a range of packaging solutions for v oid fill,
cushioning, blocking and bracing, and w rapping applications.

Rhone Capital, L.L.C.

6/19/2014

SPG Holdings LLC

SPG Holdings LLC manufactures and markets specialty paper products

for the restaurant and foodserv ice distribution industries.

Georgia-Pacific Consumer
Products LP

6/17/2014

Duro Bag Manufacturing

Company

Duro Bag Manufacturing Company manufactures and distributes paper

bags in North America.

NOVOLEX

6/3/2014

Graphic Packaging, Bags

and Kraft Paper

Graphic Packaging I nternational, I nc., Bags and Kraft Paper Business

produces and distributes kraft paper and bags.

Mondi Limited

5/1/2014

Pretium Packaging, LLC

Pretium Packaging, LLC designs, manufactures, and sells rigid plastic

bottles and containers for food, personal care, healthcare, and
pharmaceutical end markets in the United States and Canada.

Genstar Capital, LLC

4/22/2014

Pregis Corporation

Pregis Corporation engages in the manufacture, marketing, and supply

of protectiv e and specialty packaging solutions.

Olympus Partners

1/6/2014

New Page Holdings I nc.

New Page Holdings I nc. produces and sells printing and specialty papers Verso Paper Corp.
in North America.

PAGE | 7

PACKAGING
INDUSTRY UPDATE FEBRUARY 2015

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UNITED STATES

EUROPE

Boston

Philadelphia

Frankfurt

Cleveland

Richmond (U.S. Headquarters)

London

Minneapolis

San Francisco

Two International Place

24th Floor
Boston, Massachusetts 02110
Phone: +1 (617) 482-7501
Fax: +1 (617) 482-7503
1900 East 9th Street
20th Floor
Cleveland, Ohio 44114
Phone: +1 (216) 689-2400
Fax: +1 (216) 689-2401
222 South 9th Street
Suite 3350
Minneapolis, Minnesota 55402
Phone: +1 (612) 359-2700
Fax: +1 (612) 359-2701

1600 Market Street

21st Floor
Philadelphia, Pennsylvania 19103
Phone: +1 (267) 675-5900
Fax: +1 (267) 675-5901
1001 Haxall Point
9th Floor
Richmond, Virginia 23219
Phone: +1 (804) 648-0072
Fax: +1 (804) 648-0073

575 Market Street

31st Floor
San Francisco, California 94105
Phone: +1 (415) 288-4260
Fax: +1 (415) 288-4269

Bockenheimer Landstrasse 33-35

60325 Frankfurt
Germany
Phone: +49 069 3650638 00
Fax: +49 069 3650638 01
63 Brook Street
London W1K 4HS, England
Phone: +44 (0) 20 7518 8900
Fax: +44 (0) 20 7526 2187

NETWORK OFFICES
Beijing

New Delhi

Hong Kong

Shanghai

Mumbai

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BUILDING PRODUCTS & MATERIALS

INDUSTRY UPDATE | JANUARY 2015

HARRIS WILLIAMS & CO.

SOURCES

Bloomberg
Bureau of Economic Analysis
Capital IQ
Federal Reserve Economic Data

www.eMarketer.com
Eurostat
Freedonia
New York Times
Packaging News
Plastics News
The Wall Street Journal

University of Michigan
U.S. Census Bureau
Washington Post
DISCLOSURES
Harris Williams & Co. (www.harriswilliams.com) is a preeminent middle market investment bank focused on the advisory needs of clients worldwide.
The firm has deep industry knowledge, global transaction expertise, and an unwavering commitment to excellence. Harris Williams & Co. provides
sell-side and acquisition advisory, restructuring advisory, board advisory, private placements, and capital markets advisory services.

Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co.
Ltd, which is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and
Harris Williams & Co. Ltd conduct business.
THIS REPORT MAY CONTAIN REFERENCES TO REGISTERED TRADEMARKS, SERVICE MARKS AND COPYRIGHTS OWNED BY THIRD-PARTY INFORMATION
PROVIDERS. NONE OF THE THIRD-PARTY INFORMATION PROVIDERS IS ENDORSING THE OFFERING OF, AND SHALL NOT IN ANY WAY BE DEEMED AN ISSUER
OR UNDERWRITER OF, THE SECURITIES, FINANCIAL INSTRUMENTS OR OTHER INVESTMENTS DISCUSSED IN THIS REPORT, AND SHALL NOT HAVE ANY LIABILITY
OR RESPONSIBILITY FOR ANY STATEMENTS MADE IN THE REPORT OR FOR ANY FINANCIAL STATEMENTS, FINANCIAL PROJECTIONS OR OTHER FINANCIAL
INFORMATION CONTAINED OR ATTACHED AS AN EXHIBIT TO THE REPORT. FOR MORE INFORMATION ABOUT THE MATERIALS PROVIDED BY SUCH THIRD
PARTIES, PLEASE CONTACT US AT THE ABOVE ADDRESSES OR NUMBERS.
The information and views contained in this report were prepared by Harris Williams & Co. (Harris Williams). It is not a research report, as such term is
defined by applicable law and regulations, and is provided for informational purposes only. It is not to be construed as an offer to buy or sell or a
solicitation of an offer to buy or sell any financial instruments or to participate in any particular trading strategy. The information contained herein is
believed by Harris Williams to be reliable, but Harris Williams makes no representation as to the accuracy or completeness of such information. Harris
Williams and/or its affiliates may be market makers or specialists in, act as advisers or lenders to, have positions in and effect transactions in securities
of companies mentioned herein and also may provide, may have provided, or may seek to provide investment banking services for those
companies. In addition, Harris Williams and/or its affiliates or their respective officers, directors and employees may hold long or short positions in the
securities, options thereon or other related financial products of companies discussed herein. Opinions, estimates and projections in this report
constitute Harris Williams judgment and are subject to change without notice. The financial instruments discussed in this report may not be suitable for
all investors, and investors must make their own investment decisions using their own independent advisors as they believe necessary and based upon
their specific financial situations and investment objectives. Also, past performance is not necessarily indicative of future results. No part of this material
may be copied or duplicated in any form or by any means, or redistributed, without Harris Williams prior written consent.
Copyright 2015 Harris Williams & Co., all rights reserved.

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