Slide 1: Fourth Quarter 2022 Earnings
March 1, 2023 Fourth Quarter 2022 Earnings
Slide 2: Cautionary Notes
2 Cautionary Notes This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this presentation that do not relate to matters of historical fact should be considered forward-looking statements, includi
Slide 3: Funko is built on the principle that everyone is a fan of something
3 is built on the principle that everyone is a fan of something… FUNKO 2023
Slide 4: … and Funko Has Something for Every Fan
4 … and Funko Has Something for Every Fan Movies TV Music Sports Anime Games Note: Represents a sampling of our current portfolio offerings as of December 31, 2022. FUNKO 2023
Slide 5: Q4 and FY Financial Summary
5 Q4 and FY Financial HOLLYWOOD Summary UPDATE Q4 2022 Financial Summary FY 2022 Financial Summary • Net sales decreased 1% to $333.0 million • Net sales increased 29% to $1.3 billion • Net income decreased 368% to $(46.7) million • Net income decreased 108% to $(5.2) million • Adjusted EBITDA(1) de
Slide 6: Q4 & FY Summary
6 Q4 & FY Earnings UPDATE HOLLYWOOD Summary Q4’22 Q4’21 % Change FY’22 FY’21 % Change $ millions, except per share amounts, unaudited Net sales $333.0 $336.3 (1.0)% $1,322.7 $1,029.3 28.5% Gross profit(1) $94.3 $113.9 (17.2)% $434.0 $381.0 13.9% Gross margin %(1) 28.3% 33.9% 32.8% 37.0% SG&A 139.2 7
Slide 7: Q4 & FY Active Properties & Net Sales per Active Property
7 Q4 & FY Active Properties HOLLYWOOD UPDATE & Net Sales per Active Property Active Properties & Net Sales per Active Property Fourth Quarter Fiscal Year $ in thousands, unaudited Active Properties Net Sales per Active Property Active Properties down 17% Active Properties down 3% Net Sales per Activ
Slide 8: Top Properties Breakout
8 Top Properties Breakout HOLLYWOOD UPDATE Q4’21 Q1 ‘22 Q1’21 Q2’22 Q3’22 Q4’22 Q4’22 Commentary 1 5%* 6%* 6%* 6%* 5%* The top property in 2 Q4’22 represented 5% of sales 3 Evergreen properties accounted for 66% of 4 sales in Q4’22 5 6 7 8 9 10 Top 10 *% of net sales Properties 31% 31% 34% 35% 30% %
Slide 9: Q4 Brand Performance
9 Q4 Brand Performance HOLLYWOOD UPDATE Core Collectibles Loungefly Other $ in millions, unaudited 6.6% 30.9% 13.0% Decrease Increase Decrease Core Collectibles decreased 6.6% due to lower evergreen content sales as constrained logistics led to the prioritization of current content; Loungefly grew 3
Slide 10: FY Brand Performance
10 FY Brand Performance HOLLYWOOD UPDATE Core Collectibles Loungefly Other $ in millions, unaudited 21.6% 67.7% 23.9% Increase Increase Increase
Slide 11: Q4 Geographic Performance
11 Q4 Geographic Performance HOLLYWOOD UPDATE United States Europe Other International $ in millions, unaudited 4.7% 0.2% 44.8% Decrease Decrease Increase The U.S. decreased 4.7% and Europe decreased 0.2%, due to slower retailer restocking in both geographies; Other International grew 44.8% with dou
Slide 12: FY Geographic Performance
12 FY Geographic Performance HOLLYWOOD UPDATE United States Europe Other International $ in millions, unaudited 30.0% 22.3% 32.0% Increase Increase Increase
Slide 13: Q4 & FY Adjusted EBITDA
13 Q4 & FY AdjustedUPDATE HOLLYWOOD EBITDA(1) Adjusted EBITDA(1) Fourth Quarter Fiscal Year $ in millions, unaudited Adjusted EBITDA 11.6% (1.9)% 14.6% 6.6% 7.4% Margin(1) Q4 Adjusted EBITDA(1) decreased y/y due to sales mix ($6M), freight & storage ($7M), personnel expense ($9M), higher fulfillment
Slide 14: Q4 & FY Adjusted Net Income
14 Q4 & FY AdjustedUPDATE HOLLYWOOD Net Income(1) Adjusted Net Income(1) Fourth Quarter Fiscal Year $ in millions, unaudited Adjusted Net Income 6.1% (5.4)% 7.4% 6% 2.2% (Loss) Margin(1) 1. See Supplemental Financial Information section for a reconciliation of Adjusted Net Income, a non-GAAP measure
Slide 15: Key Balance Sheet Highlights
15 Key Balance SheetUPDATE HOLLYWOOD Highlights $ in millions 12/31/22 12/31/21 YoY % Change Cash & Cash $19.2 $83.6 (77.0)% Equivalents Accounts Receivable, $167.9 $187.7 (10.5)% net Inventory $246.4 $166.4 48.1% Total Debt(1) $245.8 $173.2 41.9% Total Liquidity(2) $164.2 $183.6 (10.5)% 1. Total De
Slide 16: Debt Overview
16 Debt Overview UPDATE HOLLYWOOD Total Debt(1) 2021 2022 $ in millions, unaudited 1. Total Debt is defined as the amount outstanding under the Company’s Line of Credit, Equipment Finance Loan, plus Current Portion of Long-Term Debt, Net of Unamortized Discount plus Long-Term Debt, Net of Unamortize
Slide 17: Supplemental Financial Information
Supplemental Financial Information
Slide 18: Condensed Consolidated Statements of Operations
18 Condensed Consolidated Statements of Operations HOLLYWOOD UPDATE(unaudited) Year Ended Twelve Months Ended Three Months Ended December 31, December 31, 2022 2021 2022 2021 (in thousands, except per share data) Net sales $ 333,040 $ 336,273 $ 1,322,706 $ 1,029,293 Cost of sales (exclusive of depre
Slide 19: Condensed Consolidated Balance Sheets
19 Condensed HOLLYWOOD UPDATEConsolidated Balance Sheets December 31, 2022 2021 (in thousands, except per share data) Assets Current assets: Cash and cash equivalents $ 19,200 $ 83,557 Accounts receivable, net 167,895 187,688 Inventory 246,429 166,428 Prepaid expenses and other current assets 39,648
Slide 20: Condensed Consolidated Statements of Cash Flows
20 Condensed HOLLYWOOD Consolidated Statements of Cash Flows UPDATE Year Ended December 31, 2022 2021 2020 (in thousands) Operating Activities Net (loss) income $ (5,240) $ 67,854 $ 9,763 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, amortization and
Slide 21: Reconciliation of Non-GAAP Financial Metrics
21 Reconciliation HOLLYWOOD UPDATE of Non-GAAP Financial Metrics Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 (in thousands, except per share data) Net income (loss) attributable to Funko, Inc. $ (42,219) $ 11,672 $ (8,035) $ 43,900 Reallocation of net income
Slide 22: Reconciliation of Non-GAAP Financial Metrics
22 Reconciliation of Non-GAAP Financial Metrics Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 (in thousands) Net income $ (46,700) $ 17,449 $ (5,240) $ 67,854 Interest expense, net 4,480 1,246 10,334 7,167 Income tax expense (14,869) 4,247 (17,801) 17,061 Depre
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