Slide 1: A Leader in Global Casual Footwear
, Inc. A LEADER IN GLOBAL CASUAL FOOTWEAR JANUARY 2023 | Confidential
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This document includes estimates, projections, and statements relating to our plans, commitments, objectives, and expectations that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Ac
Slide 3: Business Update
BUSINESS UPDATE ANDREW REES, CHIEF EXECUTIVE OFFICER | Confidential
Slide 4: Crocs, Inc. Expects to Report an Exceptional 2022
CROCS, INC. EXPECTS TO REPORT AN EXCEPTIONAL 2022 • Expect revenues of ~$3.55B* with growth of ~53% − Crocs Brand revenues expected to be up ~15% to ~$2.65B or ~19% constant currency − HEYDUDE Brand revenues expected to be >$890M; on a pro forma basis** revenues expected to have increased ~70% to ne
Slide 5: Investment Highlights
INVESTMENT HIGHLIGHTS • A Global Leader in Casual Footwear with $160B Total Addressable Market • Two Iconic, High-Growth Scale Brands Aligned to Long-Term Consumer Trends • Diversified Sources of Growth Across Brands, Categories, Geographies and Channels • Industry-Leading Margins and Cash Flow Gene
Slide 6: A Global Leader in Branded Casual Footwear
A GLOBAL LEADER IN BRANDED CASUAL FOOTWEAR Full Year Pro Forma 2022E Revenue* ($ in bn) * SAP Capital IQ consensus estimates for competitors as of 1/4/2023. Crocs Inc. pro forma FY 2022E reflects expected estimated revenues. Pro forma includes HEYDUDE for the period prior to acquisition 6 close (ass
Slide 7: $160B Total Addressable Market
$160B TOTAL ADDRESSABLE MARKET Significant Positions in ~$305B Non-Athletic Footwear Market Casual Other (e.g., $125B flats, wedges) $142B Clogs Sandals $8B $30B * Total addressable market sizes based on management estimates. 7
Slide 8: Two Iconic, High-Growth Scale Brands
TWO ICONIC, HIGH-GROWTH SCALE BRANDS 2022E Revenues* ~$2.65B ~$1.0B PF ** 2022E Revenue Growth* 19% CC ~70% PF ** 2022E Crocs, Inc. Non-GAAP Operating Margin* ~27% * FY 2022E reflects expected estimated revenues and guidance for non-GAAP operating margin. Full 2022 financial results to be announced
Slide 9: Brands Aligned to Long-Term Consumer Trends
BRANDS ALIGNED TO LONG-TERM CONSUMER TRENDS CASUALIZATION COMFORT-LED SUSTAINABILITY PERSONALIZATION FUNCTIONALITY 9
Slide 10: Diversified Sources of Growth
DIVERSIFIED SOURCES OF GROWTH FY2022E Revenue Mix* Brand Product HEYDUDE Other 27% Casual 45% Clogs 55% Crocs 73% Geography Digital Penetration** Channel International 29% Digital DTC 37% 45% Americas Wholesale 71% 55% * FY 2022E reflects expected estimated revenues and mix. All figures are approxim
Slide 11: Opportunity to Grow and Scale International Markets
OPPORTUNITY TO GROW AND SCALE INTERNATIONAL MARKETS ~38% % International Revenues* <5% ~34% 2022E Int’l Revenue Growth* % International Revenues* * FY 2022E reflects expected estimated revenues. Full 2022 financial results to be announced in February 2023. 11
Slide 12: Track Record of Value Creation
TRACK RECORD OF VALUE CREATION $5.6B 54% SHAREHOLDER ANNUALIZED TOTAL VALUE CREATION SHAREHOLDER RETURN SINCE 2017* SINCE 2017* 2nd Best Performer in S&P 500 over the past 5 years had Crocs Inc. been in the S&P 500** * From December 31, 2017 to December 31, 2022. Shareholder value creation defined a
Slide 13: Near-Term Catalysts
NEAR-TERM CATALYSTS • Significant new product introductions planned for 2023 for both brands • All regions expected to grow, with growth led by international markets • Robust marketing to drive double-digit Crocs sandal growth • Deepen assortments for HEYDUDE within top US Wholesale accounts • Debt
Slide 14: Value Creation Roadmap
VALUE CREATION ROADMAP ANNE MEHLMAN, EVP & CHIEF FINANCIAL OFFICER | Confidential
Slide 15: Significant Value Creation from Both Brands
SIGNIFICANT VALUE CREATION FROM BOTH BRANDS Industry Exceptional High Revenue Leading Cash Flow Growth Profitability Generation 15
Slide 16: Expect Industry-Leading Margins and Cash Flow Generation
EXPECT INDUSTRY-LEADING MARGINS AND CASH FLOW GENERATION High Revenue Growth Industry Leading Profitability Industry Leading Profitability Exceptional Cash Flow Generation ~53% ~55% ~27% ~$1B 2022E Revenue 2022E Q3 YTD 2022E Non-GAAP 2022E Adjusted Growth* Non-GAAP Gross Margin* Operating Margin* EB
Slide 17: 5th Year of Crocs Brand Revenue Growth
5TH YEAR OF CROCS BRAND REVENUE GROWTH ~$2.65B $2.3B $1.4B $1.2B $1.0B $1.1B 2017 2018 2019 2020 2021 2022E YOY ~15% (1.2%) 6.3% 13.1% 12.6% 66.9% Growth ~19% CC Transformation & Profitable Growth with 20 consecutive quarters of growth (excluding Q1/Q2 2020) Brand Re-ignition * Reflects Crocs Brand
Slide 18: Crocs Brand 2022 Growth Led by Digital and International
CROCS BRAND 2022 GROWTH EXPECTED TO BE LED BY DIGITAL AND INTERNATIONAL FY22E Revenue Growth* ~18% 2022E Digital Growth* ~35% ~32% ~38% 2022E Digital Penetration* ~15% ~6% Asia Pacific EMEALA Americas 2022E DTC DTC Comparable Comparable Sales Growth* Sales Growth ~12% * Reflects Crocs Brand revenues
Slide 19: HEYDUDE Pro Forma Revenues Nearly $1B
HEYDUDE PRO FORMA REVENUES* NEARLY $1B ~$1B $580M $191M $20M $56M 2018 2019 2020 2021 2022E PF** YOY -- 180% 239% 204% ~70% Growth Expect ~37% Digital Penetration** * Pro forma includes HEYDUDE for the period prior to acquisition close (assuming the acquisition had closed on the first day of such tr
Slide 20: 2023E Revenue Growth Expected in All Brands and Regions
2023E REVENUE GROWTH EXPECTED IN ALL BRANDS AND REGIONS 2023E Revenues ~$3.9B − 4.0B 2023E Revenue Growth* 10% − 13% * FY 2023E reflects expected estimated revenues at constant currency rates. 20
Slide 21: Capital Allocation Priorities
CAPITAL ALLOCATION PRIORITIES BRAND RETURN OF DEBT GROWTH CAPITAL TO PAYDOWN INVESTMENT SHAREHOLDERS 21
Slide 22: Significant Cash Flow Generation Fuels Rapid Deleveraging
SIGNIFICANT CASH FLOW GENERATION FUELS RAPID DELEVERAGING Net Debt / Adjusted EBITDA Repaid additional $300M in Q4 2.9x 2.4x ≤ 2.0x 0.8x YE 2021 PF YE 2021 for HEYDUDE PF Q3 2022 Mid-Year 2023E Gross 1.1x 3.1x 2.5x ≤2.0x Leverage 1. Assumes excess free cash flow used to repay borrowings. Net Debt /
Slide 23: Track Record of Significant Return of Capital to Shareholders
TRACK RECORD OF SIGNIFICANT RETURN OF CAPITAL TO SHAREHOLDERS 2014-2022 Total Share Repurchase Average Price $1.6B $38 * As of December 31, 2022, Crocs, Inc. had 61,749,296 shares of its common stock, par value $0.001 per share, outstanding. 23
Slide 24: Investment Highlights
INVESTMENT HIGHLIGHTS • A Global Leader in Casual Footwear with $160B Total Addressable Market • Two Iconic, High-Growth Scale Brands Aligned to Long-Term Consumer Trends • Diversified Sources of Growth Across Brands, Categories, Geographies and Channels • Industry-Leading Margins and Cash Flow Gene
Slide 25: Appendix
APPENDIX 25
Slide 26: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS In addition to financial measures presented on the basis of accounting principles generally accepted in the United States of America (“GAAP”), we present “Non-GAAP cost of sales,” “Non- GAAP gross profit” and “Non-GAAP gross margin, “Non-GAAP income from operations,” “Non-GA
Slide 27: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS Non-GAAP Cost of Sales, Gross Profit, and Gross Margin Reconciliation: Nine Months Ended September 30, 2022 (in thousands) GAAP revenues $ 2,609,823 GAAP cost of sales $ 1,245,864 Distribution centers (1) (4,896) HEYDUDE inventory fair value step-up (2) (62,238) Inventory re
Slide 28: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS Non-GAAP Operating Margin Guidance and Adjusted EBITDA Reconciliation: Full Year 2022 Financial Guidance: Approximately: Non-GAAP operating margin and operating income reconciliation: GAAP operating margin and operating income 23% Non-GAAP adjustments, primarily associated w
Slide 29: Crocs, Inc.
Crocs | inc.