Slide 1: Investor / Analyst Presentation August 5, 2010
Investor / Analyst Presentation August 5, 2010
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation -looking statements” within the meaning includes “forward Reform Act of1995. Black Diamond Equipment (“Black “plans,” “expects,” “intends,” “future,” -looking statements. These”will,” and forward-looking statements involve a number of risks, uncertainties
Slide 3: Video
Video Black Diamond
Slide 4: Investment Considerations
Investment Considerations Formative transaction creates “pure play” in the A leading global designer, manufacturer and distributor of technical outdoor recreation equipment and lifestyle products for climbers, alpinists, hikers, freeride skiers, and outdoor enthusiasts and travelers Targeting $500 m
Slide 5: Black Diamond Equipment Board of Directors
Black Diamond Equipment Board of Directors Warren B. Kanders, Executive Chairman - Chairman and Chief Executive Officer of Armor Holdings, Inc. (NYSE: AH), 1996 2007 - Founder and Vice Chairman of the Board of Benson Eyecare Corporation (NYSE: EYE) Robert R. Schiller, Executive Vice Chairman - Direc
Slide 6: Black Diamond Equipment Management Team
Black Diamond Equipment Management Team Peter Metcalf, President and Chief Executive Officer, 28 years with BDE - Co-founded Black Diamond Equipment, Ltd. in 1989 Robert Peay, Chief Financial Officer and Secretary, 14 years with BDE - Accounting Manager, Financial Controller and Chief Financial Offi
Slide 7: Black Diamond Equipment Management Team
Black Diamond Equipment Management Team VP of Product Development, 8 years with BDE - Director of Product Creation for Reef - Nike, The North Face, and Giro VP of Sales, 17 years with BDE - President of Entre Prises, climbing wall manufacturer - Co-founder and senior manager of Metolius Mountain Pro
Slide 8: Corporate Structure
Corporate Structure Leverage Global Operating Platform Black Diamond Equipment, Inc. Future Brands
Slide 9: Heritage and History
Heritage and History 1957 Chouinard Equipment, Ltd. founded by Yvon Chouinard with his purchase of a second-hand coal-fired forge to make hard-steel pitons for use in Yosemite Valley 1972 Introduces new aluminum chockstone, called Hexentrics 1982 Peter Metcalf hired to run Chouinard Equipment, a $90
Slide 10: Heritage and History
Heritage and History 1965 At age 14, Wayne Gregory designs his first backpack as part of a Boy Scout project 1970 Wayne starts his first company, Sunbird, with the goal of producing advanced external frame packs 1973 Peter Metcalf uses a Sunbird pack for his Alaskan first ascent 1977 Wayne founds Gr
Slide 11: The Black Diamond Code
The Black Diamond Code We should always aim to be the best at what we do and be the market leader Our products and passion should be toward building a true global presence Our efforts should always support the foundation of the industry, the specialty retailer We create long-term partnerships with c
Slide 12: Black Diamond Markets to a Wide Variety of Passionate Outdoor Enthusiasts
Black Diamond Markets to a Wide Variety of Passionate Outdoor Enthusiasts Around the World
Slide 13: Black Diamond Creates Products Out of Necessity Not Fashion or Fad
Black Diamond Creates Products Out of Necessity Not Fashion or Fad Black Diamond began as a Company fueled by providing innovative and leading edge products to customers who demand the best Creating superior technical products Each product is designed and crafted for a specific need or to perform a
Slide 14: Our Products - Climbing
Our Products - - Climbing Carabiners and quick draws Harnesses Belay and rappel Protection Chalk bags Dogbones and runners Helmets Climbing packs
Slide 15: Our Products - Climbing
Our Products - Climbing BP) B le |7 bays
Slide 16: Our Products - Skiing
Our Products - - Skiing Skis Boots Bindings Poles Snow gloves Skins Avalung Snow safety Snow packs
Slide 17: Our Products - Skiing
Our Products - - Skiing
Slide 18: Our Products - Mountain
Our Products - - Mountain Lighting Trekking poles Gloves Technical mountaineering packs Backpacking Backpacking ventilated Hiking ventilated All mountain packs Active trail Shelter Gaiters Tents Accessories
Slide 19: Our Products - Mountain
Our Products - Mountain —v oe | i e g — [Black Dian S Rp 4 Black Diamond
Slide 20: Our Products - Lifestyle
Our Products - - Lifestyle High-end daypacks Japanese/other Asian lifestyle Shoulder bags and carry-alls Satchels Duffle bags Rain covers Clothing
Slide 21: Our Products - Lifestyle
Our Products - Lifestyle a ® ® @ Black Diamond
Slide 22: Brand Positioning - Climbing
Brand Positioning - Climbing High Brand Cachet Arc’Teryx Five Ten Patagonia Misty Sterling Petzl Mountain Rope prAna Wild Mammut Krieg Country Edelrid La Sportiva Narrow Product Range Broad Product Range Camp Metolius Grivel Evolv Mont Blanc DMM Trango Omega Red Chili Pacific Mad Rock Voodoo Climbin
Slide 23: Brand Positioning - Skiing
Brand Positioning Skiing High Brand Cachet Atomic Line Salomon Nordica Scott Volkl K2 Marker Tecnica Dynastar Rossignol Narrow Product Range Broad Product Range Lange Voile G3 bca Fischer Swix Karhu Dynafit Leki Low Brand Cachet
Slide 24: Brand Positioning - Mountain
Brand Positioning - Mountain High Brand Cachet Patagonia The North Face Osprey Mountain MSR Dakine Cloudveil Hard Wear OR Marmot Kelty Narrow Product Range Broad Product Range deuter Go Lite Sierra Big Agnes Designs REI Leki Eastern Vaude Mountain Sports Gordini Low Brand Cachet
Slide 25: Accolades
Accolades Winner of “REI Vendor of the Year” in both specific Consistently rank as one of the top vendors to key dealers Winner of product and category awards from industry magazines Outside, Backpacker, Powder, Ski, Skiing, Climb, Rock & Ice and many others Outside Magazine 2009/2010 Gear of the Ye
Slide 26: Environmentalism and Corporate Social Responsibility
Environmentalism and Corporate Social Responsibility Black Diamond and our employees support a number of non-profit organizations that help the Outdoor industry, our community, and the environment Black Diamond initiated a solid waste recycling program in 2007 - Recycled approximately 60% of total s
Slide 27: Product and Market Diversification
Product and Market Diversification Categories Markets 20% 32% 50% 53% 27% 18% Climb Ski Mountain North America Europe Rest of World Significant R&D capabilities and pipeline Diversified geographies and channels for new product introductions
Slide 28: Global Operations
Global Operations BD: Salt Lake City, UT Headquarters, manufacturing and distribution center Gregory: Japan 250+ employees Sales and marketing 3 employees Gregory: Sacramento, CA Gregory, sales and marketing BD: Basel, Switzerland 43 employees Sales and marketing, distribution Gregory: Calexico, CA
Slide 29: Salt Lake City, UT - Headquarters
Salt Lake City, UT - Headquarters 250+ employees Manufacturing and office facility - ISO 9001 certified - 3 Sigma testing of personal protective equipment Distribution Center - Quality assurance Product testing Research and Design Retail store Indoor climbing
Slide 30: Zhuhai, China Manufacturing and Distribution
Zhuhai, China Manufacturing and Distribution In 2006, Black Diamond Equipment Asia was established in southeast China - Black Diamond built, owned and managed facility that is operated and staffed by Black Diamond employees - The manufacturing standards are identical to Salt Lake City factory Manufa
Slide 31: Zhuhai, China Manufacturing and Distribution
Zhuhai, China Manufacturing and Distribution
Slide 32: Zhuhai, China Manufacturing and Distribution
Zhuhai, China Manufacturing and Distribution
Slide 33: Growth through New Product Development
Growth through New Product Development Express Ice Screw, Move HQ to Salt HotWire carabiner Adopt 3 Sigma acquire Bibler Lake City Tents 1989 1992 1994 1996 1991 1993 1995 1997 Black Diamond Riva T1, first plastic FlickLock Europe, ISO 9001 certified telebinding telemark boot adjustable pole BD beco
Slide 34: Growth through New Product Development
Growth through New Product Development C3 Camalots, O1 AvaLung and Freeride boots, Viper Ice Tool telebindings and Acension Skins BD UIAA certified AvaLung packs 1998 2001 2004 2007 2009 1999 2002 2006 2008 Half Dome helmet, Moonlight and Hot forged acquire Franklin Black Diamond Asia SpaceShot cara
Slide 35: Areas of Expansion
Areas of Expansion Organic and Acquisition Technical clothing Technical footwear Mountain apparel / products Lifestyle apparel / products Military Helmets Goggles Sunglasses Electronics
Slide 36: The Opportunity
The Opportunity Hunting / Camping / Hiking / Climbing Snowboard / Ski Fashion Workwear Fishing Mountain Hardware Spyder Moncler Timberland The North Face Burton Pro Patagonia Bogner Wolverine Rossignol Oakley Bulwark Nike ACG Timberland Orvis K2 Arc’teryx Premium Descente UGG Hunter Under Merrell Ro
Slide 37: Pure Play in Active Outdoor Lifestyle Markets
Pure Play in Active Outdoor Lifestyle Markets $US in millions CY 2010E Price % of 52- Valuation EBITDA EV / Sales EV / EBITDA P/E PEG Div Company 7/22/10 Wk high Equity Enterprise Revenue margin 2009A 2010E 2011E 2009A 2010E 2011E 2010E 2011E Ratio yield Nike Inc. $71.56 91.1% $34,565 $30,011 19,673
Slide 38: Q2 2010 Press Release Summary
Q2 2010 Press Release Summary Selected Balance Sheet Information Pro Forma Revenues and Gross Profit $US in millions $US in millions June 30, 2010 3 months 6 months (Unaudited) ended ended 6/30/2010 6/30/2010 Cash $ 3.3 Total revenue 23.7 56.8 Net deferred assets Gross profit (3) 9.422.5 Deferred ta
Slide 39: Selected Pro Forma Financial Information
Selected Pro Forma Financial Information Pro forma combined Income Statement Year 3 months ended ended $US in thousands 12/31/2009 3/31/2010 Domestic sales 51,162 14,365 International sales 62,338 18,747 Total revenue 113,500 33,112 Gross profit 43,466 13,128 Margin 38% 40% SG&A 35,476 9,721 Amortiz
Slide 40: Tax Considerations
Tax Considerations Company has NOLs of $237.5 million as of June 30, 2010 $65 million long-term deferred tax asset related to prior operating losses BDE has the ability to issue up to approximately 40 million additional common shares in a single, fully distributed offering under certain conditions R
Slide 41: Investment Considerations
Investment Considerations Formative transaction creates “pure play” in the A leading global designer, manufacturer and distributor of technical outdoor recreation equipment and lifestyle products for climbers, alpinists, hikers, freeride skiers, and outdoor enthusiasts and travelers Targeting $500 m
Slide 42: The Beginning
The Beginning