Envela Corporation · AMEX:ELA
Envela — Investor Presentation (2021)
27 slides from Envela's investor presentation, 2021
Slide 1: Recommerce - Extending the Life of Goods
RECOMMERCE - EXTENDING THE LIFE OF GOODS NYSE: ELA Fall 2021 Investor Presentation
Slide 2: Cautionary Statements
Cautionary Statements This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, that is, statements that address future, not past events. In this context, forward-looking statements
Slide 3: Envela and its subsidiaries in recommerce
and its subsidiaries engage in diverse business activities within the recommerce sector. These include recommercializing luxury hard assets, consumer electronics and IT equipment; and end-of-life recycling solutions. • Ticker Symbol – NYSE American: ELA • Company HQ: Irving, Texas • Number of employ
Slide 4: Industry Problems
Industry Problems Electronic waste is likely the fastest-growing waste stream in the world • Estimated $60 billion (50 million tons) of global electronic waste generated annually • Toxic chemicals from electronic waste (e.g., mercury, lead, beryllium, cadmium) are extremely harmful to people and sur
Slide 5: What is Recommerce?
What is Recommerce? Re·com·merce / rē kämǝrs / Recommercialization The process of reselling previously-owned products as whole goods, or recycling items’ components/ materials for reuse. Recommerce is the foundation of the circular economy — an economic system aimed at eliminating waste and driving
Slide 6: Our Recommerce Solutions: Extract – Resell - Reuse
Our Recommerce Solutions: Extract – Resell - Reuse End-of-life recycling includes traditional recycling performed by waste-management companies. But for specialists like Envela, it also entails extracting, collecting, and reselling high-value components, metals, and other materials. Jewelry styles c
Slide 7: Recommerce requires accurately assessing prospective inventory
Recommerce Evaluating potential recommerce inventory Recommerce requires includes: accurately assessing 1 • Determining resale value prospective inventory of items as a whole, perhaps requiring for resale, reuse, or refurbishment or upgrading recycling 2 • Calculating recycle value of reusable produ
Slide 8: Recommerce Consumer and Market Trends
Recommerce Consumer and Market Trends rate at which of 18-29-year-olds favor recommerce merchants 74% sustainable, recycled, 4x are growing faster than or reused products retail women purchased pre- estimated size of 56M owned handbags in $58B e-waste market by 2021 2018 of toxic, heavy metals count
Slide 9: Growing Total Addressable Market
Growing Total Addressable Market Online Most common recommerce items Brick & Mortar Sold as whole goods • Cars • Jewelry • Clothing • Electronics • Gym equipment ► • Furniture • Musical instruments Recycled for component resale or refining • Printer ink • Jewelry (precious metals & gems) • Electroni
Slide 10: Our business operates in two primary divisions
Our business operates in two primary divisions Preserving the environment is at the heart of our business model. In a resource-constrained world, we must optimize the use of natural resources. We are committed to help enable the circular economy through recommerce. Principally operates a portfolio o
Slide 11: Retail Exchange Stores
DGSE Proprietary Retail brands RETAIL EXCHANGE STORES A leading marketplace for authenticated luxury hard assets. Our retail stores offer a marketplace for the public and dealers to buy, sell & trade fine jewelry, watches, fine art, and luxury items. An in-house staff of experts, including horologis
Slide 12: Online Precious-Metal Sales
DGSE Proprietary Retail brands ONLINE PRECIOUS-METAL SALES Precious metals garnered from our retail locations are sold through Bullion Express, one of the region’s largest precious-metals dealers. Through this channel we offer a wide selection of gold, silver, platinum, and palladium coins, bars, bu
Slide 13: DGSE entities recommercialize hard assets
DGSE entities recommercialize hard assets (jewelry, diamonds, fine watches, rare coins and currency, precious-metal bullion, collectibles) as refurbished whole goods or recycles them– reusing their components or refining their metals. Where we acquire recommerce inventory Individuals selling items p
Slide 14: ECHG Subsidiaries
ECHG Subsidiaries Sustainability is the core of our business. We help industries • Custom-designed, • Tailored solutions return securely and comprehensive end-of-life reusable whole responsibly reuse, electronics-recycling products into the supply recycle and manage solutions meet customers’ chain s
Slide 15: ECHG's Clients are some of the Biggest & Most Valuable Companies
ECHG’s Clients are some of Biggest & Most Valuable Companies in the World ECHG helps world-leading brands and retailers accelerate We work with their sustainability transformations by extending their companies that are assets’ life cycles. committed to a low- carbon future. They appreciate our help
Slide 16: ECHG entities recommercialize consumer electronics and IT equipment
ECHG entities recommercialize consumer electronics and IT equipment; and produce the highest values via resale as whole goods, or recycling components or metals/materials. Where we acquire recommerce inventory Businesses Educational Manufacturers Individuals that upgrade and other with returned with
Slide 17: Growth Strategy
Continually broaden our participation in the environmental sector. Focus on most profitable B2B and B2C segments for 1 reselling and recycling Leverage economies of scale, develop interdivisional 2 synergies, reduce marketing costs for whole and recycled goods Growth Strategy 3 Utilize our extensive
Slide 18: Growth & Expansion Initiatives
Growth & Expansion Initiatives DGSE • Increase number of operating stores by opening new locations in current markets (Dallas/Fort Worth and Charleston, SC) and new markets. • New-store additions depends on internal-investment success, availability of preferred sites, regulatory environments, zoning
Slide 19: ESG
ESG • Core focus of company is recycling, reusing and sustainability • Reducing electronic waste helps reduce CO2 emissions and harmful chemicals in our environment • ECHG companies audited and certified to ISO 14001:2015 standard (environmental management) • Workforce gender and racial diversity •
Slide 20: Valuation Benchmarking
Valuation Benchmarking Sales EPS EV / P/E Company Ticker EV TTM TTM Sales TTM Sector Product focus Distribution Luxury clothing for men and THE REALREAL REAL $1.79B $320M $-1.81 5.59x - Recommerce Online and Retail women Consignment luxury clothing Online and Retail THREDUP TDUP $2.34B $193M $-3.75
Slide 21: Competitive Advantages
Competitive Advantages Deep exposure to both B2C Strong network of partners and B2B segments and well-established relationships Online and brick & mortar retail-distribution Highly experienced and expertise disciplined teams Economies-of-scale Revenue and cost synergies between synergies between bus
Slide 22: Investment Highlights
The recommerce sector is growing 4x faster than retail and expected to accelerate after coronavirus pandemic Two divisions with operating companies focused on the highest volume/value recommerce products Robust network of partners to quickly sell valuable inventory to wholesale customers and third-p
Slide 23: Financial Performance
Financial Performance Total Sales Gross Margin 45000 7400 40000 7200 Dollars (Thousands) Dollars (Thousands) 35000 7000 30000 6800 25000 6600 20000 6400 15000 6200 10000 6000 5000 5800 0 5600 Q2 2021 Q1 2021 Q4 2020 Q3 2020 Q2 2021 Q1 2021 Q4 2020 Q3 2020 Net Income EPS 3500 0.12 3000 0.1 Dollars (T
Slide 24: ELA income statement
ELA income statement For the YEARS Ended December 31 For the THREE MONTHS Ended June 30 FY 2019 FY 2020 2Q 2020 2Q 2021 TOTAL SALES $ 82,024,497 $ 113,922,015 $ 20,545,607 $ 33,724,006 Cost of Sales 65,768,655 90,853,052 16,074,349 26,596,116 Gross Margin $ 16,255,842 $ 23,068,963 $ 4,471,258 $ 7,12
Slide 25: Division Sales Performance
Division Sales Performance Q2 2020 Margin Q2 2021 Margin Q2 2020 Margin Q2 2021 Margin Resale of Whole Goods $ 13,421,969 10.8% $ 20,893,838 12.8% $ 4,257,032 47.5% $ 8,595,910 35.1% Resale of Recycled Components / Materials $ 927,060 18.3% $ 2,118,486 19.7% $ 1,939,546 43.0% $ 2,115,772 47.8% TOTAL
Slide 26: Corporate Snapshot
Corporate Snapshot $8.4M ~71% $104.3M Total Cash and Cash Insider Ownership Market Cap Equivalents (7-16-21) (7-16-21) (3-31-21) 26.9M $139M 11 Shares Outstanding Forecasted 2021 Straight Quarters of (5-4-21) Revenue Profitability 26
Slide 27: Headquarters Campus and Investor Relations Contact
Headquarters Campus: Investor Relations Contact: Envela Corporation Matt Glover and John Yi 1901 Gateway Drive Gateway Investor Relations Irving, Texas 75038 949-574-3860 ELA@gatewayir.com