Slide 1: Investor Presentation
lg COTY > , INVESTOR PRESENTATION § SINCE 1904
Slide 2: Investment Thesis
INVESTMENT THESIS ONE OF THE MOST BEAUTIFUL PORTFOLIOS, WITH TWO COMPLEMENTARY BRAND PORTFOLIOS ▪ ONE OF THE MOST BEAUTIFUL & COMPREHENSIVE BRAND PORTFOLIOS IN THE INDUSTRY, AND THE ONLY GROUP AT THIS LEVEL TO OPERATE TWO COMPLEMENTARY BRAND PORTFOLIOS RAPIDLY EXECUTING ON ALL KEY STRATEGIC GROWTH P
Slide 3: Coty Overview
COTY OVERVIEW TITLE OF THE PRESENTATION 3
Slide 4: Who We Are Today
WHO WE ARE TODAY… A GLOBAL LEADER IN FRAGRANCE AND COLOR COSMETICS STRONG POSITIONS IN KEY MARKETS WITH A DIVERSE BRAND PORTFOLIO in fragrances CY20 Net in color cosmetics Revenues #2 in Prestige Fragrances #2 in Prestige Fragrances #1 in Prestige Fragrances #2 in Mass Cosmetics #1 in Mass Cosmetics
Slide 5: A Portfolio of Iconic Brands Across Key Price Tiers
A PORTFOLIO OF ICONIC BRANDS ACROSS KEY PRICE TIERS Kim Kardashian’s skincare 5
Slide 6: Strategy & Recent Milestones
STRATEGY & RECENT MILESTONES TITLE OF THE PRESENTATION 6
Slide 7: Our Strategic Priorities
OUR STRATEGIC PRIORITIES STABILIZE CONSUMER BEAUTY MAKE-UP BRANDS & MASS FRAGRANCES ACCELERATE LUXURY FRAGRANCES & BECOME A KEY PLAYER IN PRESTIGE MAKE UP BUILD SKINCARE PORTFOLIO ACROSS BOTH DIVISIONS BUILD E-COMMERCE AND DIRECT-TO-CONSUMER EXPERTISE AND CAPABILITIES EXPAND IN CHINA ON LUXURY AND S
Slide 8: Boss Bottled Experience Platform & Live Influencer Content
B O S S B O T T L E D E X P E R I E N C E P L AT F O R M & L I V E I N F L U E N C E R C O N T E N T 5 30 ~150 ~36M ~3M Soccer Players Influencers Posts & Stories Impressions Engagements #SuitChallenge https://www.boss-bottled-united.com/
Slide 9: Strong Prestige Launch Calendar for 1HFY22
STRONG PRESTIGE LAUNCH CALENDAR FOR 1HFY22 ➢ MILEY CYRUS ANNOUNCED AS THE FACE OF ➢ NEW MALE FRAGRANCE PILLAR GUCCI FLORA GORGEOUS GARDENIA EAU DE PARFUM ➢ AVAILABLE FROM JULY 30TH ➢ REFRESHED COSMETICS PRODUCT PORTFOLIO & INTEGRATED DTC WEBSITE ➢ NEW MALE FRAGRANCE PILLAR 9
Slide 10: Lancaster
IANCASTER MONACO Lagardere Sanya Outpost
Slide 11: Lancaster Skincare Pop-Up in China Drawing Crowds
LANCASTER SKINCARE POP-UP IN CHINA DRAWING CROWDS in first few days are Skin & Suncare Hybrids 11
Slide 12: Robust Profit Growth
ROBUST PROFIT GROWTH ADJUSTED EBITDA • 3Q21 ADJUSTED EBITDA OF $183M, INCREASING >$180M YOY $183M 17.8% Margin • EBITDA MARGIN UP 18PPS TO 17.8% • DESPITE SALES DECLINE, SIGNIFICANT YOY PROFIT GROWTH • YEAR-TO-DATE ACHIEVED OVER $270M OF SAVINGS $(1.4M) (0.1%) Margin • ON TRACK TO REACH FY21 TARGET
Slide 13: FY21 Is the Baseline for Coty's Sales & Profit Acceleration
FY21 IS THE BASELINE FOR COTY’S SALES & PROFIT ACCELERATION NET REVENUE AND EBITDA MARGINS Confirming near term targets: $6.3B ~16-17% ▪ On track to end FY21 with net ~$0.3B Adj EBITDA revenues of ~$4.5-4.6B ~$0.3B Margin ~$4.5-4.6B ▪ Confirming FY21 adjusted EBITDA ~$0.1B 13.3% ~$1.2B ~$0.3B target
Slide 14: Luxury Business to Drive Future Revenue & Profit Growth
LUXURY BUSINESS TO DRIVE FUTURE REVENUE & PROFIT GROWTH SKINCARE CHINA PRESTIGE COSMETICS (Prestige + Mass; (% of Total Net Revenues) (% of Total Net Revenues) % of Total Net Revenues) High Single Over 10% Over 10% Digit % ~6% ~3% ~3% FY21 FY25 FY21 FY25 FY21 FY25 Est Target Est Target Est Target 14
Slide 15: Coty's Transformation Journey
COTY’S TRANFORMATION JOURNEY TITLE OF THE PRESENTATION 15
Slide 16: We Are Transforming All Aspects of the Company
WE ARE TRANSFORMING ALL ASPECTS OF THE COMPANY FROM TO CORPORATE STRATEGY not in line with the market Focus on GROWTH AREAS BRAND STRATEGIES and portfolio not clear PRODUCT CENTRIC brands and portfolio IP AND INNOVATION firepower not utilized Investment in INNOVATION and leveraging what we have B&M
Slide 17: All-In to Win Is Coty's End-to-End Transformation Program
ALL-IN TO WIN IS COTY’S END-TO-END TRANSFORMATION PROGRAM FY21 FY22 FY23 PRIMARY FOCUS AREAS KEY OUTCOMES FUNDING THE FIXED COSTS JOURNEY INVEST IN A&CP GROSS MARGIN ATTACK: GROSS TO NET/ PRICING RESETTING COTY’S GROSS MARGIN & COGS INCREASE PROFITABILITY DELIVER SUSTAINABLE, 6 GROWTH FUND GROWTH PR
Slide 18: Savings Program on Track to Deliver ~$300M in FY21
SAVINGS PROGRAM ON TRACK TO DELIVER ~$300M IN FY21, $100M AHEAD OF SCHEDULE BREAKDOWN OF TARGETED FY21 COST SAVINGS Trade Investment 5% Structural A&CP 17% COGS 14% Fixed Costs (Headcount, Business Svcs) 64% 18
Slide 19: On Track for ~$600M Savings Through FY23
ON TRACK FOR ~$600M SAVINGS THROUGH FY23, WITH PIPELINE OF PROJECTS EXTENDING INTO FY24 SAVINGS DELIVERY TIMELINE ($M) MUCH OF INITIAL FY22 SAVINGS PLAN ACCELERATED INTO FY21 ~$200M FY22 SAVINGS ARE NET SAVINGS AND >$100M INCORPORATE HEADWINDS FROM: ~$300M • INVESTMENT IN GROWTH PILLARS, INCLUDING C
Slide 20: Transformation Extends Beyond Cost Savings: Gross Margin Expansion
TRANSFORMATION EXTENDS BEYOND COST SAVINGS PROGRAM, WITH MULTI-PRONGED FOCUS ON GROSS MARGIN EXPANSION GROSS MARGIN ATTACK PROGRAM ▪ COTY 3QYTD GROSS Commercial GM Attack Supply Chain Attack Manufacturing MARGIN OF ~60% VS. E&O Distribution BEAUTY PEERS AT >70% Trade Invest & Pricing ▪ STRATEGIC GRO
Slide 21: Coty's Portfolio Optimization Program
COTY’S PORTFOLIO OPTIMIZATION PROGRAM Tail-End SKU Rationalization Platforming Assortment Management • Removing Non-Productive SKUs (low • Common formula ‘chassis’ and • Prioritization of competing SKUs with performing, low profitability) packaging formats higher GM • Revenue neutral due to increase
Slide 22: Cash Olympics – Targeting Leverage Towards 5x Exiting CY21
CASH OLYMPICS – TARGETING LEVERAGE TOWARDS 5X EXITING CY21, AND CONTINUED DELEVERAGING AFTER KEY STREAMS EXAMPLES OF IDENTIFIED OPPORTUNITES MORE THAN $100M IN ANNUAL VALUE AT RISK - $20M REDUCTION TARGETED REDUCTION IN DSO BY 40 DAYS IN AN EMEA MARKET FOLLOWING GO-TO-MARKET CHANGE, WITH CASH FLOW I
Slide 23: Conclusion
CONCLUSION TITLE OF THE PRESENTATION 23
Slide 24: Investment Thesis
INVESTMENT THESIS ONE OF THE MOST BEAUTIFUL PORTFOLIOS, WITH TWO COMPLEMENTARY BRAND PORTFOLIOS RAPIDLY EXECUTING ON ALL KEY STRATEGIC GROWTH PILLARS GROSS MARGIN AND COST REDUCTIONS WILL FUEL OUR GROWTH PLANS MULTIPLE LEVERS TO DELEVERAGE 24
Slide 25: Disclaimer
DISCLAIMER Forward-Looking Statements Certain statements in this presentation are forward-looking statements. These forward-looking statements reflect the Company's current views with respect to, among other things, the impact of COVID-19 and potential recovery scenarios, the Company’s comprehensive
Slide 26: 26
26