Duluth Holdings Inc. · NASDAQ:DLTH
Duluth — Q2 2021 Earnings Presentation
23 slides from Duluth's earnings presentation, Sep 3, 2021
Slide 1: Investor Presentation Second Quarter 2021
Investor Presentation Second Quarter 2021 September3, 2021
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements ‘This presentation dated September 3, 2021 indudes “forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts included in this presentation, including stateme
Slide 3: Introduction to Duluth Trading Co.
Introduction to Duluth Trading Co.
Slide 4: Duluth Trading Co. at a Glance
Duluth Trading Co. at a Glance Workwear Heritage is the Foundation of our Authentic, Everyday Lifestyle Platform of Brands + Long History of Product Innovation and Solution-Based Design + Humorous and Distinctive Marketing + Outstanding and Engaging Customer Experience + Nationwide Omnichannel Prese
Slide 5: Investment Highlights
Investment Highlights * Growing lifestyle platform of brands with well-established digitally-led Omnichannel business ¢ Multiple revenue growth opportunities > Lead with a digital-first mindset > Intensify efforts to optimize our owned DTC channels > Evolve our multi-brand platform as a new pathway
Slide 6: Second Quarter Ended August Financial Highlights
Second Quarter Ended August 1 Financial Highlights Q2 Net sales of $149.1M increased 8.6% compared to Q2 2020, and increased 22.3% compared to Q2 2019 + Direct-to-consumer net sales of $85.2M decreased -15.2% compared to Q2 2020, and increased 41.5% compared to Q2 2019 + Retail net sales of $63.9M i
Slide 7: Net Sales and Adjusted EBITDA
Net Sales and Adjusted EBITDA ¢ Strong track record of 15% Net Sales and 13% Adjusted EBITDA growth * Strategic investments and operating efficiencies support long-term objectives of accelerated earnings growth (Sin milions) (Sin miltions) 2015 2016 2017 2018 2019 20202021* 2015 2016 2017 2018 2019
Slide 8: Growth Strategy
Growth Strategy
Slide 9: "Big Dam Blueprint" Growth Strategies
“Big Dam Blueprint” Growth Strategies 1 Lead With a D 3 Evolve Our Multi- Brand Platform Sieber a 4 Test & Leam to Unlock Long- Term Growth Pot i
Slide 10: Lead With a Digital-First Mindset
Lead With a Digital-First Mindset * Transform Duluth into a digitally-led organization integrating data and digital technology into all areas of our business, fundamentally changing how we operate and deliver value to customers. * Our digital transformation will provide the structure for how we prio
Slide 11: Intensify Efforts to Optimize Our Owned DTC Channels
Intensify Efforts to Optimize Our Owned DTC Channels | pers? * Increase our focus and investments in our direct channel as our primary growth vehicle * Our customer places a high value on our stores and they will continue to serve as a critical piece of the omnichannel ecosystem: > Convenient touchp
Slide 12: Evolve our Multi-brand Platform as a New Pathway to Grow the Business
Evolve our Multi-brand Platform as a New Pathway to Grow the Business * Ladder to the Greater Purpose: “Celebrating the can-do spirit by enabling anyone who takes on life with their own two hands.” * Focus on features, benefits, durability, innovation and a strong value proposition @) * Prioritize s
Slide 13: Gain operational learnings to implement whole including logistics
Gain operational learnings to implement whole including logistics, systems and people needed to scale efficiently Gain direct-from-manufacturer operational learnings to offer unique and customized products based on customer’s preferences Test the viability of potential drop-ship model Seek compellin
Slide 14: Increase and, in Some Areas, Accelerate Investments to Future Proof the Business
Increase and, in Some Areas, Accelerate Investments to Future Proof the Business * Analyze and identify investments that will allow us to scale more easily and effectively, as well as deliver on ever-evolving customer expectations: v Increased investments in automation across our logistics network t
Slide 15: Strengthening the Men's Business
Strengthening the Men’s Business ai + On a trailing twelve-month basis, men’s apparel net sales across our brands increased 6.7% over the prior year period + Selectively broaden our assortment in certain product categories to satisfy customer needs + Cement Duluth as the most innovative workwear bra
Slide 16: Growing the Women's Business
Growing the Women’s Business + Ona trailing twelve-month basis, women’s apparel net sales increased 7.0% over the prior year period + Continue customer acquisition through marketing investments and retail presence + Deepenrelationships with female customers by introducing a women’s line to Alaskan H
Slide 17: Financial Review
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Slide 18: Three Months Ended August 1, 2021
Three Months Ended August 1, 2021 Gross Profit (Sin mlions) (Sin mlions) m= Retail Direct $137.4 ik $149.1 $72.5 azsile S8t:4 es, 88", ao $100.6 $85.2 2020 2021 2020 2024 (8/2/2020) (8/1/2021) (8/2/2020) (8/1/2021) Margin 52.8% 54.6% A sted EBITDA’ | Netincomer | (Sin mlions) (Sin milions) $21.6 $16
Slide 19: Strong Balance Sheet and Liquidity
Strong Balance Sheet and Liquidity Debtto Capital": 2 Year to Date Free Cash Flow As of August 1, ($ in milions) 2021 $21.5 Debt: Line of Credit 0.0 | | Term Loan 0.0 Total Debt 0.0 $(22.0) Total Shareholders’ Equity 204.4 2020 2021 Total Capitalization $ 204.4 (8/2/2020) (8/1/2021) Debtto Capital r
Slide 20: Fiscal 2021 Updated Financial Guidance
Fiscal 2021 Updated Financial Guidance 2020 2021 Guidance Reco! to 2021 Forecasted Adj. EBITDA (S in millions) Fiscal Year Ended January 30, 2022 ($ in millions) Low High Net Sales $638.8 | $700-$715 Forested Netincome $ 235 $ 25.0 19.6% — 119% (+) Depreciation and amortization 28.2 282 (+) Amorizat
Slide 21: Long-Term Financial Targets
Long-Term Financial Targets ($ in millions) Net Sales Operating Margin % Adj. EBITDA % Free Cash Flow 2017 2018 2019 2020 2025 Targets $471.4 $568.1 $615.6 $638.8 $1.0B 7.9% 6.5% 4.6% 3.8% 9-10% 9.8% 9.1% 8.4% 8.7% 14-15% ($16.6) ($21.9) ($22.4) $38.5 Positive Sieber a
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Slide 23: Reconciliation to Q2 2021 Adjusted EBITDA and Free Cash Flow
Reconciliation to Q2 2021 Adjusted EMTDA and Free Cash Flow pers? Adjusted EBITDA ee Cash Flow 3. Months Ended 6 Months Ended ‘Aug, ‘Aug2, ‘Aug, ‘Aug 2, (Sin milfons) 2024 2020 (Sin millions) 2024 2020 Net income (loss) aa SS _Netoashprovided by operating activites z 255 (128) ()Deprediation and amo