Clarus Corporation · NASDAQ:CLAR
Clarus — Black Diamond — Investor Presentation (June 2012)
36 slides from Clarus's investor presentation, Jun 7, 2012
Slide 1: Corporate Presentation June 2012
Corporate Presentation June 2012 NASDAQ | BDE
Slide 2: Forward-looking statements
1 NASDAQ | BDE Please note that in this presentation we may use words such as “appears,” “anticipates,” “believes,” “plans,” “expects,” “intends,” “future,” and similar expressions which constitute forward - looking statements within the meaning of the safe harbor provisions of the Private Securitie
Slide 3: Who We Are
2 NASDAQ | BDE Leading global designer and manufacturer of innovative active outdoor performance products Double - digit top - line growth at Black Diamond Equipment since 1990 OUR 5 CONSTRUCTS : Passion and Intimacy – gets us up in the morning Innovation – drives us (in all we do) Efficiency –
Slide 4: Black Diamond's Opportunity
3 NASDAQ | BDE BLACK DIAMOND’S OPPORTUNITY Authentic Portfolio of Iconic Lifestyle Brands Industry Leading Product Innovation and Development Capabilities Broad Product, Channel and Geographic Diversification Scalable Global Operating Platform Significant Growth Opportunities Experienced
Slide 5: Highly Favorable Market Dynamics
4 NASDAQ | BDE HIGHLY FAVORABLE MARKET DYNAMICS (1) Represents current Black Diamond, Inc. target markets; Source: Outdoor Recreation Participation Report 2011, Outdoor Industry Association, SportsScanInfo for OIA Vantage Point (2) Company estimate Outdoor Sector Highlights Large and Growing Globa
Slide 6: Our Culture Defines Our Products and Iconic Brands
5 NASDAQ | BDE OUR CULTURE DEFINES OUR PRODUCTS AND ICONIC BRANDS Our employees are our most discerning customers and demand the most innovative, consistent products Our passion for and intimacy with the sports we serve helps to drive innovation Company of Passionate Users High Performance Produ
Slide 7: Industry Leading Product Innovation and Development Capabilities
6 NASDAQ | BDE Marquee Introductions INDUSTRY LEADING PRODUCT INNOVATION AND DEVELOPMENT CAPABILITIES Legacy of redefining the categories in which we enter Strong track record of technical innovation and production development Portfolio of over 70 patents (1) Product development strives to e
Slide 8: Diversified Business Model
7 NASDAQ | BDE Category Geography Distribution 27 product categories No specific product category accounts for more than 15% of sales Significant global presence – in over 50 countries More than 50% of sales from outside the U.S . Rapid growth in Asia Broad distribution platform across m
Slide 9: Scalable Global Operating Platform
8 NASDAQ | BDE SCALABLE GLOBAL OPERATING PLATFORM BASEL, SWITZERLAND • Sales & marketing, distribution • 50+ employees ZHUHAI, CHINA • Manufacturing & distribution • 195+ employees JAPAN • Sales & marketing • 3 employees SALT LAKE CITY, UT • Headquarters, sales & marketing, manufacturing & distribut
Slide 10: Growth Opportunities
9 NASDAQ | BDE GROWTH OPPORTUNITIES Introduce New Product Technologies Continued double - digit growth driven by future product innovation Grow into New Categories Significant investment in technical outdoor apparel initiative Apparel expected to launch Fall 2013 Pursue Selected Outdoor Acquis
Slide 11: Leverage Retail Sector Growth
10 NASDAQ | BDE Entrance Cashier Camping Climb Ski Travel & Backcountry Gear Paddle Fitness Cycle Footwear & Accessories Gloves & Mittens LEVERAGE RETAIL SECTOR GROWTH BD Products Command Substantial Floor Space Outdoor specialty retailers have shown considerable growth in recent years • Recreatio
Slide 12: Introduce New Product Technologies
11 NASDAQ | BDE Current Examples of Innovation Magnetron: Uses the power of magnetic fields to reinvent the locking carabiner Cayenne Heated Glove: Utilizes a built in heater to set exact amount of warmth INTRODUCE NEW PRODUCT TECHNOLOGIES Continue to redefine the categories through which we enter
Slide 13: Our Apparel Initiative
12 NASDAQ | BDE OUR APPAREL INITIATIVE Targeting $250 million in sales by 2020 Category expected to generate higher gross margin Significant progress with key retailers and suppliers/manufacturers of textiles and technical materials Key retailers from N. America, Japan, China, Europe and Rus
Slide 14: Broaden Distribution and Elevate Brand
13 NASDAQ | BDE BROADEN DISTRIBUTION AND ELEVATE BRAND European market highly fragmented with no clear cross - border leader Significant opportunity to elevate the brand across the continent through investments in marketing and merchandising Asian consumers rapidly adopting outdoor and adventu
Slide 15: Pursue Selected Outdoor Acquisitions
14 NASDAQ | BDE PURSUE SELECTED OUTDOOR ACQUISITIONS Acquiror of choice • Authentic and iconic brand heritage • Global operating platform with universal application • Targets see us as a partner rather than an acquiror Exploring several near - term opportunities Also pursuing larger, strategic
Slide 16: Black Diamond to Acquire POC Sweden AB
15 NASDAQ | BDE BLACK DIAMOND TO ACQUIRE POC SWEDEN AB (1) Who is POC? Established: 2004 – Stockholm, Sweden Vision: to be the leading supplier of protection gear for gravity sports athletes and to grow into a global sport lifestyle brand Offering: superior personal protective gear such as: •
Slide 17: Personal Protection and Performance Gear for Gravity Sports Athletes
16 NASDAQ | BDE PERSONAL PROTECTION AND PERFORMANCE GEAR FOR GRAVITY SPORTS ATHLETES
Slide 18: POC Product Innovation and Awards
17 NASDAQ | BDE POC produces and distributes innovative products to 27 countries Operations in Sweden, Austria, France and U.S.; retail store in Chamonix, France. The POC Lab is renowned for its research and innovation, setting standards for construction, material combinations and engineering
Slide 19: Why POC and Black Diamond?
18 NASDAQ | BDE WHY POC AND BLACK DIAMOND? POC and Black Diamond are both solutions - based brands focused on personal protection for outdoor athletes. We believe POC is one of the fastest - growing brands in action sports whose brand footprint is much larger than its sales footprint. Black Di
Slide 20: POC Transaction Details
19 NASDAQ | BDE POC TRANSACTION DETAILS Purchase Price: 311 million Swedish kronor or ~$43.5 million cash, subject to closing exchange rates and ~460,000 shares of BDE common stock (the exact number of shares will be determined at closing). Shares to be issued at closing will be subject to a two -
Slide 21: A Powerful Outdoor Equipment and Lifestyle Platform
20 NASDAQ | BDE A POWERFUL OUTDOOR EQUIPMENT AND LIFESTYLE PLATFORM One of the most pristine and globally recognized brands in the space Products for climbers, mountaineers and skiers as well as aspirational outdoor enthusiasts Heritage dates back to 1957 Premier technical backpacking and mo
Slide 22: Building a $500 Million Business
21 NASDAQ | BDE $146 $500 $104 $250 $250 2011 2015 2020 BUILDING A $500 MILLION BUSINESS Growth Plan Targets ($ in millions) Over 50% potential organic growth through execution of base business strategy Acquisitions expected to contribute $250 million to top - line sales by 2015 Apparel expect
Slide 23: Historical Financial Performance
22 NASDAQ | BDE HISTORICAL FINANCIAL PERFORMANCE Adj. EBITDA (2) ($ in millions) Pro Forma Sales (1) ($ in millions) $125.0M $145.8M $153.1M 2010 2011 LTM 3/31/12 (1) See Appendix for a reconciliation of Sales to Pro Forma Sales. (2) See Appendix for a reconciliation of Adjusted EBITDA to net income
Slide 24: Operating Margins Poised for Growth
23 NASDAQ | BDE OPERATING MARGINS POISED FOR GROWTH Significant investments in our global operating platform and R&D • Leverage these investments as sales grow Shift of sales mix to higher margin products • Technical apparel • POC Future synergy opportunities • Consolidated supply, logistics,
Slide 25: Pro Forma Sales Quarter/Quarter
24 NASDAQ | BDE % - Denotes Y - o - Y Growth 1. See Appendix for reconciliation of Sales to Pro Forma Sales. 2. 2009 data pro forma assuming the acquisition of Black Diamond Equipment and Gregory Mountain Products by Clarus Corporation had occurred on January 1, 2009. 3. 2010 data pro forma assuming
Slide 26: Balance Sheet Supports Growth
25 NASDAQ | BDE BALANCE SHEET SUPPORTS GROWTH (1) Growth - oriented balance sheet • Revolver capacity of $35.0 million as of 3/31/2012 • On Feb 22 , closed a public offering for 8.9 million shares at $7.50 for net proceeds of $63.4 million NOLs of $217.1 million as of Dec 31, 2011 protect future
Slide 27: NOL Summary
26 NASDAQ | BDE NOL SUMMARY Net Operating Losses of $ 217.1 million as of December 31, 2011 $73.7 million deferred net tax asset as of December 31, 2011 $215.5 million of NOL’s do not expire until 2020 and beyond Rights Agreement limiting the number of 5% stockholders NOL Expiration Schedule
Slide 28: Guidance and Long-Term Targets
27 NASDAQ | BDE GUIDANCE AND LONG - TERM TARGETS (1) Total Revenue ~$500 million by 2015 Revenue Growth Comprised of: - Organic Growth $125 million - Acquisitions $250 million Long - Term Targets 2012 Revenue $160 - 165 million - YOY Growth > 10 - 13% 2012 Gross Margins ~ 38.6% 2012 Guidance (1) Doe
Slide 29: Key Takeaways
28 NASDAQ | BDE KEY TAKEAWAYS Authentic Portfolio of Iconic Lifestyle Brands Industry Leading Product Innovation and Development Capabilities Broad Product, Channel and Geographic Diversification Scalable Global Operating Platform Significant Growth Opportunities Experienced and Incentiv
Slide 30: Black Diamond, Inc. contact details
29 NASDAQ | BDE NASDAQ | BDE Black Diamond, Inc. 2092 East 3900 South Salt Lake City, UT 84124 Tel 801.278.5552 Company Contact Peter Metcalf, CEO Investor Relations Liolios Group Scott Liolios or Cody Slach Tel 949.574.3860 BDE@Liolios.com
Slide 31: Appendix
30 NASDAQ | BDE APPENDIX NASDAQ | BDE
Slide 32: Management team
31 NASDAQ | BDE NAME & TITLE YEARS AT BDE RELEVANT PRIOR EXPERIENCE Peter Metcalf President and CEO 29 Co - Founded Black Diamond Equipment, Ltd. in 1989 Pioneer Alaskan alpinist Robert Peay CFO, Secretary and Treasurer 15 Public accounting with Arthur Andersen Ryan Gellert President, BD Equipment 1
Slide 33: Gregory Mountain Products Case Study
32 NASDAQ | BDE Transaction Value: $44.2 million 2010 Sales: $27.8 million (1) EV / Sales: 1.6x GREGORY MOUNTAIN PRODUCTS CASE STUDY Background & Investment Rationale In May 2010, Black Diamond, Inc. acquired Gregory Mountain Products, Inc. (“GMP”) for $44.2 million in cash and stock GMP w
Slide 34: Armor Holdings Case Study
33 NASDAQ | BDE ARMOR HOLDINGS CASE STUDY (1) Source : FactSet Research Systems . (2) Represents total consideration to shareholders. Total Gross Transaction Value was approximately $4.2 billion. Background & Overview Industry characteristics • Favorable market trends • Highly fragmented Under t
Slide 35: Appendix: Adjusted EBITDA Reconciliation
34 NASDAQ | BDE APPENDIX: ADJUSTED EBITDA RECONCILIATION Source: Company filings . ($ in thousands)
Slide 36: Appendix: Pro Forma Sales Reconciliation
35 NASDAQ | BDE APPENDIX: PRO FORMA SALES RECONCILIATION Source: Company filings . ($ in thousands)