Brilliant Earth Group, Inc. · NASDAQ:BRLT
Brilliant Earth — William Blair 42nd Annual Growth Stock Conference (June 2022)
28 slides from Brilliant Earth's conference presentation, Jun 8, 2022
Slide 1: William Blair 42nd Annual Growth Stock Conference
William Blair 42nd Annual Growth Stock Conference June 8, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation and statements to be made on the earnings conference call (collectively, the “Presentation”), contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical
Slide 3: Our mission is to create a more transparent, sustainable and compassionate jewelry industry
Our mission is to create a more transparent, sustainable and compassionate jewelry industry 3
Slide 4: The Next Generation Fine Jeweler
The Next Generation Mission-Driven Ethos Fine Jeweler for Today’s Personalized, Digitally Native, Consumer Joyful Omnichannel Customer Tech-Driven and Customer- Experience Obsessed Unique and Brilliant Earth is a global leader in fine jewelry. Award-Winning We are successfully executing our strategy
Slide 5: Brilliant Earth by the Numbers
Brilliant Earth by the Numbers Proven Financial $410mm 50% $3,174 50% 12.8% Performance TTM Q1 FY22 Revenue1 Y/Y Revenue Growth1 AOV1 Gross Margin1 Adj. EBITDA1 75+ 62% High Brand NPS 2 Aided Brand Awareness 3 Affinity Our success is driven by our highly tech-focused and customer-centric approach 1
Slide 6: Company History
Company History Brilliant Earth reaches consumers in all U.S. states and over 50 countries through our e-commerce platform and 19 showrooms 2019 2015 >$200mm in sales 2013 >$50mm in sales Launches blockchain 2005 2008 >$25mm in sales Launches Brilliant Earth enabled diamonds Mobile School in the Fou
Slide 7: Investment Highlights
Investment Highlights
Slide 8: Investment Highlights
Investment Highlights 1 Authentic, Mission-Driven Brand 2 Founder-Led and Diverse Leadership Team Committed to Inclusion 3 Massive Market Opportunity 4 Technology Enabled, Data-Driven Business Model 5 Unique and Exclusive Products 6 Exceptional Customer Experience 7 Capital Efficient Operating Model
Slide 9: Authentic Brand for a New Generation of Consumer
1 Authentic, Mission-Driven Brand Authentic Brand for a New Generation of Consumer Mission-Driven Unique and Exceptional Omnichannel Values Award-Winning Designs Customer Experience ✦ Transparent, responsible sourcing ✦ Unique, proprietary designs ✦ High-touch premium service ✦ Sustainability practi
Slide 10: Leader in ESG
2 Founder-Led and Diverse Leadership Team Committed to Inclusion D R I VI NG C OR P ORAT E, T E A M, A N D P R OD UCT I N I T I ATI VES Leader in ESG 88% ✦ Hulu’s Happiest Season with ✦ Blockchain Technology Kristen Stewart and Dan Levy of employees say Simone I. Smith ✦ GIA Origin Report Diamonds ✦
Slide 11: Tailwinds from Changing Consumer Preferences
3 Massive Market Opportunity Tailwinds from Changing 73% Consumer Preferences of Millennials are willing to spend more on a Engaged with social and environmental product if it comes from a issues brand that stands for sustainability3 ✦ Digitally savvy shoppers ✦ Expect to shop whenever and wherever
Slide 12: Data Capabilities Drive The Brilliant Earth Experience
4 Technology Enabled, Data-Driven Business Model Data Capabilities Drive The Brilliant Earth Experience Tech-enabled data analysis drives curated Customer interactions are tracked and analyzed product assortment in-store and online in an integrated CRM / ERP system Refined testing and sophisticated
Slide 13: Unique, Personalized Products
5 Unique and Exclusive Products Unique, Known for beautiful, unique designs Personalized ✦ In-house, award-winning design studio ✦ Hand-crafted designs exclusive to Brilliant Earth ✦ Over two-thirds of designs are proprietary 1 Products ✦ Innovative, curated collection Agile product development ✦ Cu
Slide 14: Create-Your-Own Model Drives High Inventory Turns and Negative Working Capital
6 Exceptional Customer Experience Create-Your-Own Model Drives High Inventory Turns and Negative Working Capital Select Setting Metal Ring Higher-Quality Diamond Style Choice Size Finished Product 150k+ Virtual inventory of natural & lab-grown diamonds offers broad range of options for customers1 6
Slide 15: Modern Digital Experience
6 Exceptional Customer Experience Modern Digital Experience IN D U STRY L E A DIN G C A P ABILITI ES L E A D T O H I GH E R E N GA GE ME N T A N D C ON V E R SION Strong product personalization ✦ Leading product visualization ✦ Augmented Reality virtual try on Smart product technology ✦ Product conf
Slide 16: Delightful Showroom Experience
6 Exceptional Customer Experience Delightful Showroom Experience Tech-enabled • Custom curated inventory • 1x1 appointment vs 16 “They had plenty of staff yet nobody came to our “When we arrived she already knew our preferences and assistance. We sat for a good ten minutes until we had arranged a ni
Slide 17: Capital-Efficient Showroom Strategy
7 Capital Efficient Operating Model Capital-Efficient Showroom Strategy Virtual Operating leverage from inventory model flexible staffing model Limited inventory required per store; curated for Tech-enabled team supports customer appointments and optimized across customers in other channels when sho
Slide 18: Opportunities
Opportunities
Slide 19: Major Growth Opportunities
Major Growth Expand Internationally Opportunities Expand Purchase Occasions with Existing and New Customers Expand Omnichannel Presence Increase Brand Awareness 19
Slide 20: Continue to Increase Market Share
Continue to Increase Market Share Drivers Opportunity ✦ Scale drives awareness and marketing efficiencies Increase ✦ Frequency of content and engagement across multiple touchpoints 62% Brand ✦ Global influencer partnerships Aided Brand Awareness ✦ Partnership collaborations and marketplace opportuni
Slide 21: Bridal is Just the Beginning
Bridal is Just the Beginning Fine jewelry represented Special occasions & self-purchase 63% of the global jewelry ✦ Leverage in-house design capabilities market in 20201 ✦ Nimble, data-driven product Bridal focus development Traditional today Jeweler ✦ Enhanced CRM for existing loyal customer base B
Slide 22: Positioned to be the Category Winner
Positioned to be the Category Winner ✓ Authentic, Mission-Driven Brand ✓ Founder-Led and Diverse Leadership Team Committed to Inclusion ✓ Massive Market Opportunity ✓ Technology Enabled, Data-Driven Business Model ✓ Unique and Exclusive Products ✓ Exceptional Customer Experience ✓ Capital Efficient
Slide 23: Financial Overview
Financial Overview
Slide 24: Historical Financial Results
Historical Financial Results NET REVENUE ($MILLIONS) TOTAL ADJUSTED EBITDA 1 +51% ($MILLIONS) YoY $380 $50 $252 $201 $28 $148 $112 $83 2016 2017 2018 2019 2020 2021 2020 2021 Gross profit 43% 43% 43% 42% 45% 49% margin 11% 13% 1 See Non-GAAP metrics and reconciliations for a walk from Net Income to
Slide 25: Fiscal Year 2021 Financial Results
Fiscal Year 2021 Financial Results NET SALES ($MILLIONS) TOTAL ADJUSTED EBITDA1 ($MILLIONS) TOTAL ORDERS ($THOUSANDS) $380 118 +89% $50 $252 80 $201 +51% $28 +83.4% FY 2020 FY 2021 FY 2019 FY 2020 FY 2021 FY 2020 FY 2021 +48% YoY GROWTH GROSS MARGIN EXPANSION ($MILLIONS) TOTAL ADJUSTED EBITDA1 MARGI
Slide 26: First Quarter FY22 Financial Results
First Quarter FY22 Financial Results Q1 NET SALES ($MILLIONS) Q1 GROSS MARGIN EXPANSION ($MILLIONS) Q1 ADJUSTED EBITDA1 50.1% $100.0 $70.7 $50.1 $8.4M 45.8% $32.4 8.4% OF NET SALES Q1 2021 Q1 2022 Q1 2021 Q1 2022 41.5% SALES GROWTH +432 bps YoY GROWTH 1 See Non-GAAP metrics and reconciliations for a
Slide 27: Long-term Target Model
Long-term Target Model Target Drivers Net Revenue Growth High 20%s – low 30%s Growth across our product lines and our omnichannel model Premium products and brand, price Gross Profit Margin Mid 50%s optimization engine, procurement efficiencies and growth of higher margin fine jewelry Growth of bran
Slide 28: Non-GAAP Metrics and Reconciliations
Non-GAAP Metrics and Reconciliations Three months ended Twelve months ended ADJUSTED EBITDA March 31, December 31, ($THOUSANDS) 2022 2021 2021 2020 Net income, as reported 3,369 2,408 26,256 21,576 Interest expense 1,776 1,926 7,589 4,942 Income tax expense/(benefit) 96 - (316) - Depreciation expens
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