Slide 1: First Quarter 2022 Earnings
May 5, 2022 First 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 other than statements of historical facts contained in this presentation, including statements regarding our future results of operation
Slide 3: Funko is built on the principle that everyone is a fan of something
is built on the principle that everyone is a fan of something…
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 March 31, 2022.
Slide 5: The Chernin Group-Led Consortium to Acquire 25% of Funko Shares from ACON Investments
5 The Chernin Group-Led Consortium to Acquire 25% of Funko Shares from ACON Investments for $263M Robert A. Iger Rich Paul & (Former Disney Chairman & CEO) (CEO / Founder Klutch Sports Group & Head of Sports at UTA) • TCG and its investor consortium, including eBay Inc., Robert Iger and Rich Paul, a
Slide 6: Q1 Summary and Recent Operational Highlights
6 Q1 Summary and Recent Operational Highlights Q1 2022 Financial Summary Q1 2022 Operating Highlights (compared to Q1 2021) • Net sales increased 63% to $308.3 million • Core Collectible Brands grew 53% to $239.6 million with innovation-driven growth across the brand category, including • Gross marg
Slide 7: Q1 Earnings Summary
7 Q1 Earnings Summary HOLLYWOOD UPDATE 1Q’22 1Q’21 % Change millions, except per share amounts, unaudited $308.3 $189.2 63% Net sales $108.7 $78.3 39% Gross profit(1) 35.3% 41.4% Gross margin %(1) $78.4 $51.3 53% SG&A $10.5 $10.3 2% D&A $19.8 $16.8 18% Income from operations 6.4% 8.9% Operating marg
Slide 8: Q1 Active Properties & Net Sales per Active Property
8 HOLLYWOOD Q1 Active PropertiesUPDATE & Net Sales per Active Property Active Properties & Net Sales per Active Property First Quarter $ in thousands, unaudited Active Properties Net Sales per Active Property Active Properties up 0.1% Net Sales per Active Property up 62.8% Funko is built on having a
Slide 9: Top Properties Breakout
9 Top Properties Breakout Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 Q1’22 Commentary 1 4%* 6%* 6%* 5%* 6%* The top property in 2 Q1’22 represented 6% of sales 3 Evergreen properties accounted for 61% of 4 sales in Q1’22 5 6 7 8 9 Top 10 *% of net sales Properties 30% 31% 33% 31% 31% % of Net Sales
Slide 10: Q1 Brand Category Performance
10 Q1 Brand Category HOLLYWOOD Performance UPDATE Core Collectible Brands Loungefly Other Brands (Toy & Game Brands and Digital Brands) $ in millions, unaudited 53% 103% 140% Increase Increase Increase Core Collectible Brands grew on strong results across the category, including Pop! and newer brand
Slide 11: Q1 Product Category Performance
11 Q1 Product Category HOLLYWOOD Performance UPDATE Figures Other First Quarter First Quarter $ in millions, unaudited 59% 77% Increase Increase The Figures category grew 59% driven by driven by strong growth in our core Pop! Brand, our Five Nights at Freddy’s toy collection, and our newer figure li
Slide 12: Something for Everyone
12 Something for Everyone HOLLYWOOD UPDATE Funko is providing fans with an increasingly diverse array of products and categories FIGURES OTHER 78% of 22% of Sales* Sales* *% of net sales for Q1’22
Slide 13: Q1 Geographic Performance
13 Q1 Geographic Performance HOLLYWOOD UPDATE United States Europe Other International $ in millions, unaudited 70% 43% 48% increase increase increase Sustained demand from Funko fans in all major geographies drove strong broad-based global sales growth
Slide 14: Q1 Non-GAAP Financial Metrics
14 Q1 Non -GAAP Financial HOLLYWOOD UPDATE Metrics Adjusted EBITDA(1) Adjusted Net Income (2) First Quarter First Quarter $ in millions, unaudited Adjusted Adjusted EBITDA 15.7% 6.8% 6.0% 6.6% 11.8% Net Income Margin(1) Margin(2) Ongoing supply chain inflation continues to reduce Adjusted EBITDA and
Slide 15: Key Balance Sheet Highlights
15 Key Balance SheetUPDATE HOLLYWOOD Highlights $ in millions, unaudited 3/31/2022 3/31/2021 Y/Y % Change Cash & Cash $33.1 $74.7 (55.6)% Equivalents Accounts Receivable, $188.2 $114.7 64.2% net Inventory $161.5 $61.9 160.8% Total Debt(1) $168.9 183.0 (7.7)% Total Liquidity(2) $133.1 $149.7 (11.1)%
Slide 16: Liquidity Overview
16 Liquidity Overview HOLLYWOOD UPDATE Total Liquidity(1) 2021 2022 $ in millions, unaudited Funko’s liquidity position declined y/y due to normal outflow of operating cash flow in the first quarter, in line with seasonal expense trends 1. Total liquidity is calculated as cash and cash equivalents p
Slide 17: Debt Overview
17 Debt Overview UPDATE HOLLYWOOD Total Debt(1) 2021 2022 $ in millions, unaudited Total debt decreased 7.7% y/y, and remains an important element of Funko’s capital allocation strategy 1. Total Debt is defined as the amount outstanding under the Company’s Line of Credit plus Current Portion of Long
Slide 18: Supplemental Financial Information
Supplemental Financial Information
Slide 19: Condensed Consolidated Statements of Operations
19 Condensed Consolidated Statements of Operations HOLLYWOOD UPDATE(Unaudited) Three Months Ended March 31, 2022 2021 (In thousands, except per share data) Net sales $ 308,343 $ 189,177 Cost of sales (exclusive of depreciation and amortization shown separately below) 199,649 110,853 Selling, general
Slide 20: Condensed Consolidated Balance Sheets
20 Condensed Consolidated Balance Sheets HOLLYWOOD UPDATE (Unaudited) March 31, 2022 December 31, 2021 (In thousands, except per share amounts) Assets Current assets: Cash and cash equivalents $ 33,131 $ 83,557 Accounts receivable, net 188,219 187,688 Inventory 161,502 166,428 Prepaid expenses and o
Slide 21: Condensed Consolidated Statements of Cash Flows
21 Condensed Consolidated Statements of Cash Flows HOLLYWOOD UPDATE (Unaudited) Three Months Ended March 31, 2022 2021 (In thousands) Operating Activities Net income $ 14,518 $ 11,086 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation, amortizati
Slide 22: Reconciliation of Non-GAAP Financial Metrics
22 Reconciliation of Non-GAAP Financial Metrics HOLLYWOOD UPDATE (Unaudited) Three Months Ended March 31, 2022 2021 (In thousands, except per share data) Net income attributable to Funko, Inc. $ 9,882 $ 6,514 Reallocation of net income attributable to non-controlling interests from the assumed excha
Slide 23: Reconciliation of Non-GAAP Financial Metrics
23 Reconciliation of Non-GAAP Financial Metrics (Unaudited) Three Months Ended March 31, 2022 2021 (amounts in thousands) Net income $ 14,518 $ 11,086 Interest expense, net 1,210 2,237 Income tax expense 3,678 2,293 Depreciation and amortization 10,471 10,262 EBITDA $ 29,877 $ 25,878 Adjustments: Eq
Slide 24: Reconciliation of Non-GAAP Financial Metrics
24 Reconciliation of Non-GAAP Financial Metrics Twelve Months Ended December 31, 2021 2020 (in thousands) Net income $ 67,854 $ 9,763 Interest expense, net 7,167 10,712 Income tax expense 17,061 2,025 Depreciation and amortization 41,195 44,368 EBITDA $ 133,277 $ 66,868 Adjustments: Equity-based com
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