Yeti Holdings, Inc. · NYSE:YETI
Yeti — Q3 2019 Earnings Presentation
24 slides from Yeti's earnings presentation, Oct 31, 2019
Slide 1: Investor Presentation | October 2019
INVESTOR PRESENTATION | OCTOBER 2019
Slide 2: Disclaimer
Disclaimer We are not making any representations or warranties, express or implied, with respect to the information (financial, business, legal or otherwise) contained in this presentation. No person has been authorized to give any information other than that contained in this presentation. Forward-
Slide 3: Expanding Our Customer Base
1 EXPANDING OUR CUSTOMER BASE Unaided brand awareness has grown from 2% in 2015 to 12% in 20191 2 INTRODUCE NEW PRODUCTS New product expansions across both Coolers & Equipment and Drinkware Introduced new colorways in Coolers & Equipment and Drinkware 3 ACCELERATE DTC Fastest growing and highest mar
Slide 4: Key Financial and Business Metrics
LTM Q3 2019 Net Sales KEY FINANCIAL METRICS $857MM $172MM LTM Q3 2019 LTM Q3 2019 Net Sales Adjusted EBITDA2 54% 20% LTM Q3 2019 2013 – 2018 Net Sales CAGR Coolers & Adjusted EBITDA2 Margin LTM Q3 2019 Equipment $857MM Drinkware 41% 41% KEY BUSINESS METRICS 56% 56% 11 >95% Other1 New Products Annou
Slide 5: Brand & Product
BRAND & PRODUCT.)
Slide 6: YETI's Customer Base Has Expanded
2006 FISHING HUNTING 2019 BEACH SNOW CAMPFIRE AT PLAY AT HOME AT WORK • YETI’s Customer Base Has Expanded as Brand Awareness Has Spread Nationally • New Products and Marketing Driving Attractive Shift in Demographics 11 123 64% 9% 33% Communities Ambassadors 2019 % Under 451 2015 % Female1 2019 % Fe
Slide 7: Large and Growing Social Media Presence
LARGE AND GROWING DOMESTIC UNAIDED BRAND SOCIAL MEDIA PRESENCE AWARENESS BY REGION 2 Followers1 2019 2015 4.2MM 4.2MM 20% 18% 3.0MM 14% 13% 2.6MM 11% 11% 10% 9% 8% 7% 1.3MM 4% 3% 2% 556K 1% 1% 1% 1% 0% 438K 4 4 4 East South West South 3 East North 4 West North South Pacific New 4 Mountain Mid Atlant
Slide 8: Innovative and Differentiated Products
• Innovative and differentiated products that fill market gaps and consumer needs • Aggressive first-to-market product development strategy • Best in class talent: 54 engineers, product designers, and category managers • Robust design process focused on performance and functionality • Balance of new
Slide 9: Product Reviews - Legacy
PRODUCT REVIEWS - LEGACY LAUNCHED G24 ’ 2014 "Great for coffee!” eo eu Le 4 8 / 5 EVER OWNED™” a . 7 E ON 27864 RAMBLER 200z meee TUMBLER "Stellar, solid 9 "Tiny but BIG on 2017 construction & compact 4 n é. . 7 / 5 = oon performance. design! BASED ON 545 REVIEWS v kkk HOPPER FLIP 8 | J | . | soos "
Slide 10: Product Reviews - New
PRODUCT REVIEWS - NEW 10 RAMBLER 24o0z MUG Yr CAMINO CARYALL 35 LOADOUT GOBOX 30 LAUNCHED 2019 2018 2019 “Summer Game Changer!” "My most used YETI Piece of equipment” "Best Mug Ever!!!” “Excellent all around hag!” OUR CUSTOMERS HAVE SPOKEN 4.7/5 BASED ON 1958 REVIEWS v tok bak OUR CUSTOMERS HAVE SPO
Slide 11: Innovation Creates Reason to Buy
1H 2H 1H 2H 1H 2H PRE 2016 2017 2017 2018 2018 2019 2019 Hard Cooler Sherpa®, Roadie®, Tundra®, Tank® Tundra® 210 Limited Edition Limited Edition Limited Edition Haul™ Silo™ Reef Blue River Green Soft Cooler Hopper® Field Tan Hopper Flip® 8 Hopper Daytrip™ Hopper M30 Coolers & Equipment One Colorway
Slide 12: Built for the Wild
12 BUILT £OR THE WILD,
Slide 13: Strategic Channel Mix Creates Stable, High Margin Profile
HIGHLIGHTS STRATEGIC CHANNEL MIX CREATES STABLE, HIGH MARGIN PROFILE • Diverse omni-channel business 2015 LTM Q3 2019 • Fast growing DTC business Wholesale2 Wholesale • Diverse group of U.S. retail partners with 92% 59% nationwide coverage; only one account exceeds $469MM $857MM 10% of gross sales1
Slide 14: YETI.com, Retail, Corporate Sales, YETI Authorized
YETI.COM RETAIL CORPORATE SALES YETI AUTHORIZED 14
Slide 15: Growing Global Sales Expansion Strategy
GROWING GLOBAL SALES EXPANSION STRATEGY • Capitalize on global digital, e-commerce, and mobile trends DTC & Wholesale DTC & Wholesale • Enter international markets via DTC and select wholesale • Push global brand via Ambassador, influencer, and event marketing 57% 41% Wholesale DTC & Wholesale 28% 2
Slide 16: Global Infrastructure and Global Footprint
GLOBAL INFRASTRUCTURE GLOBAL FOOTPRINT • Leading third-party manufacturing and logistics partners ll l l ll ll • Optimizing quality, delivery and best cost ll l l l l • Developed key manufacturing partners in 2017, 2018 and 2019 • Soft coolers and bag supply chain transitioned from China 1
Slide 17: Financials
- FINANCIALS
Slide 18: Net Sales, Gross Profit, Adjusted EBITDA, Capital Expenditures
NET SALES GROSS PROFIT Gross Profit % Margin $857 $441 $779 $383 $639 $295 49% 51% 46% 2017 2018 LTM Q3 2019 2017 2018 LTM Q3 2019 ADJUSTED EBITDA1 CAPITAL EXPENDITURES 1 Adjusted EBITDA % Margin Capital Expenditures % of Net Sales $172 $42 $149 $32 $97 7% $21 3% 4% 19% 20% 15% 2017 2018 LTM Q3 2019
Slide 19: Net Sales, Category and Channel Net Sales Growth
NET SALES $229 $196 Q3 2018 Q3 2019 CATEGORY NET SALES GROWTH Coolers & Drinkware Equipment $126 $104 $87 $98 Q3 2018 Q3 2019 Q3 2018 Q3 2019 CHANNEL NET SALES GROWTH Wholesale Direct-to-Consumer $136 $125 $93 $71 Q3 2018 Q3 2019 Q3 2018 Q3 2019 19 Note: $ in millions.
Slide 20: Gross Profit, Adjusted Operating Income, Adjusted EBITDA, Adjusted EPS
GROSS PROFIT ADJUSTED OPERATING INCOME1 Gross Profit $ / % Margin Adjusted Operating Income $ / % Margin $120 / 52% $98 / 50% $40 / 18% $32 / 16% Q3 2018 Q3 2019 Q3 2018 Q3 2019 ADJUSTED EBITDA1 ADJUSTED NET INCOME PER DILUTED SHARE1 Adjusted EBITDA1 $ / % Margin $47 / 21% $0.30 $38 / 20% $0.24 Q3 2
Slide 21: Appendix
APPENDIX
Slide 22: Adjusted EBITDA Reconciliation
2016 2017 2018 YTD Q3 2018 YTD Q3 2019 LTM Q3 2019 Net Income $48.8 $15.4 $57.8 $32.6 $45.7 $70.9 Interest Expense 21.7 32.6 31.3 24.5 17.1 23.9 Income Tax Expense 16.5 16.7 11.9 7.2 14.8 19.5 1 Depreciation and Amortization Expense 11.7 20.8 24.8 18.2 21.2 27.8 2 Non-Cash Stock-Based Compensation E
Slide 23: Q3 Adjusted Operating Income and Net Income Reconciliation
Q3 2018 Q3 2019 Operating Income $28.1 $34.0 1 Non-Cash Stock-Based Compensation Expense 2.9 2.1 1 These costs are reported in SG&A expenses 1 Long-lived Asset Impairment — 0.4 1,2 Investments in New Retail Locations and International Market Expansion 0.1 1.2 Represents retail store pre-opening expe
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