The Honest Company, Inc. · NASDAQ:HNST
The Honest — ICR Conference 2025
26 slides from The Honest's conference presentation, Jan 14, 2025
Slide 1: ICR Conference
ICR Conference January 14, 2025
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains certain forward -looking statements within the meaning Market data and industry information used through this presentation are based on of the federal securities laws, including statements about the outlook of our business management's knowledge
Slide 3: Welcome
Welcome Carla Vernón Kate Barton Dave Loretta Chief Executive Officer Chief Growth Officer Chief Financial Officer Broadly experienced leadership team: 2
Slide 4: Modern Brand + Modern CPG
Modern Brand + Modern CPG Carla Vernón, Chief Executive Officer
Slide 5: A Modern CPG Company Poised for Growth
A Modern CPG Company Poised for Growth Strengthened Modern Dynamic Scalable Financial Brand leadership + Growth Foundation Culture 4
Slide 6: Founded in 2012 with the goal to create a new personal care company
• Founded in 2012 with the goal to create a new personal care company with clean ingredients and sustainability at its core • The portfolio res onated with a new generation of families
Slide 7: The Honest Company is a personal care company on a mission
The Honest Company is a personal care company on a mission to challenge ingredients, ideals and industries so people can protect who they love .
Slide 8: Consumers Have New Needs
Consumers Have Children (0 -17) with a skin allergy the past 12 months over 3 year period 1 (% ) New Needs 12% 10% 8% • Growing focus on ingredients and safety 6% 1997- 2000- 2003- 2006- 2009- 2012- 2015- 2018 1999 2002 2005 2008 2011 2014 2017 o Skin allergies among children have nearly doubled s i
Slide 9: A higher standard of Clean that we call The Honest Standard
A higher standard of Clean that we call The Honest Standard Number of ingredients not permitted in products 3,500+ 1 Clean ingredients • No parabens We ban 3,500+ ingredients • No sulfates • No phthalates • No synthetic fragrances ~2,000 2 In-house labs • No petro-derived emollients • No PEGs Innova
Slide 10: Single Powerful Brand Across Aisles
Single • Powerful • Brand Across Aisles Conventional CPGs Honest is a Branded House Many Brands • Multiple Categories One Brand • Many Categories Category Category Category Category Category Category Category 1 2 3 4 5 6 7 Brand Brand Brand Brand Brand Brand Brand A B C D E F G Baby Personal Care Wi
Slide 11: The Honest Journey
The Honest Journey 2021 2023 2023 - 2025 Tomorrow The Honest New management Transformation Continued scale Company IPO team in place Initiative bearing and business model fruit maximization 10
Slide 12: Scalable Growth
Scalable Growth Kate Barton, Chief Growth Officer
Slide 13: Revolutionized Baby Care
Revolutionized Baby Care Brought modern Launched organic Created baby spa Baby gifting Online designs to diaper apparel to match moments community category diapers 12
Slide 14: Our Portfolio
Our Portfolio All product #1 s egments in baby growing s hare 2 natural brand in baby personal Larges t s hare #1 care1 gainer in natural wipes 1 climate-pledge friendly Hous ehold penetration mas cara on Amazon 4 growing at +4% Top ranked Oprah’s Favorite Things 5 : purpos e-driven pers onal care “
Slide 15: Distribution expansion a focal point of growth
Distribution expansion a focal point of growth Increasing Total Distribution Points reflects 1 the most significant growth opportunity 2 Distribution remains underpenetrated relative to competition 3 Innovation supports our objective of increased availability 14
Slide 16: Widely available with room to grow
Scalable Growth Widely available with room to grow Our retail partners today Multiple levels of opportunity .com Stores Doors Aisles Shelves Facings Innovation 15
Slide 17: Large runway for growth into more doors
Scalable Growth | Doors Large runway for growth into more doors 2024 year-end total doors selling Honest ~45,000 ~65,000 Leading Competitor ~93,000 ~19,000 Source: Circana MULO data, last 12 weeks ending 12/29/24 16
Slide 18: Hero products under-distributed
Scalable Growth | Facings Hero products under -distributed Max ACV % by SKU 88 87 Key Competitor 82 Hones t 52 33 34 19 10 Diapers Lavender Hydrogel 288 Ct. Size 1 Bubble Cream Wipes Club Box Bath Source: Circana MULO data, last 12 weeks ending 12/29/24 17
Slide 19: Opportunity for larger presence on shelf
Scalable Growth | Facings Opportunity for larger presence on shelf Average products on shelf per store selling Key Competitor 61 Hones t 33 14 11 7 4 Diapers Wipes Facial Skincare Source: Circana MULO data, last 12 weeks ending 12/29/24 18
Slide 20: Strengthened Financial Foundation
Strengthened Financial Foundation Dave Loretta, Chief Financial Officer
Slide 21: Honest is on a transformation journey
Honest is on a transformation journey 2023 2025 2026+ Transform Strengthen Grow & Scale Brand Maximization – leverage brand to drive growth through innovation & improved marketing Margin Enhancement – expand margins through mix and cost savings activities Operating Discipline – build a culture of ex
Slide 22: Transformation Initiative delivering strong results
Strengthened financial foundation | FYTD Q3 2024 Transformation Initiative delivering strong results Brand Maximization Margin Enhancement Operating Discipline +10% +1,000 bps $53M Cash YTD Revenue growth1 YTD Gross Margin increase1 $0 Debt +14% +$33M High-performing practices from leading CPG, Tech
Slide 23: Achieved Adj. EBITDA profitability
Strengthened financial foundation Achieved Adj. EBITDA profitability $7.6 Quarterly Adj. EBITDA ($ in M) $7.1 $4.3 $2.6 ($1.1) Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Source: Company Financials: 10-Q and 10-K 22
Slide 24: Financial Reporting
Q3 2024 Earnings Highlights Financial Reporting Q3 2024 Results YTD 2024 Results 2024 Guidance +High Single Digit Revenue +15% vs. LY +10% vs. LY percentage growth vs. LY Gross Margin % + 710 bps vs. LY + 1035 bps vs. LY Positive Adj. EBITDA Adj. EBITDA +$8M vs. LY +$33M vs. LY $20M to $22M range 23
Slide 25: Appendix
Appendix
Slide 26: Reconciliation of GAAP and Non-GAAP Financial Measures
Appendix Reconciliation of GAAP and Non -GAAP Financial Measures Adjusted EBITDA ($ millions) Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2024 Q2 2024 Q3 2024 Net income (loss) ($18.9) ($13.4) ($8.1) $1.1 ($39.2) ($1.4) ($4.1) $0.2 Interest and other (income) 0.2 0.0 0.1 (0.0) 0.3 0.0 0.0 (0.1) expen