Funko, Inc. · NASDAQ:FNKO
Funko — Investor Presentation (March 2024)
24 slides from Funko's investor presentation, March 2024
Slide 1: Funko Investor Presentation March 2024
Funke INVESTOR PRESENTATION P MARCH 2024
Slide 2: Cautionary Notes
Cautionary Notes This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this presentation that do not relate to matters of historical fact should be considered forward-looking statements, including
Slide 3: Funko is a Pop Culture Collectibles Company
Funko is a Pop Culture Collectibles Company The company designs, sources and distributes licensed pop culture products for consumers who seek tangible ways to connect with their favorite pop culture brands and characters. Product categories include vinyl figures, action toys, apparel and accessories
Slide 4: At a Glance
At a Glance 2023 Sales by... Ticker: Nasdaq: FNKO * IPO:2017 * Founded: 1998 Net Sales 2023: $1.1 Billion Multiple Sales Channels: Two Flagship retail stores + E-commerce sites: Funko.com, \ FunkoEurope.com, Loungefly.com, Mondoshop.com * 1,000+ Retail Partners a * International Distributors HQ: Eve
Slide 5: Core Collectibles and Brands
Core Collectibles, includes Pop! Vinyl, company’s best- known product line; thousands of licensed characters Y Fints) Funko, LLC © 2024 BRANDS Pop culture fashion items, soft-lines including backpacks, bags, wallets and apparel High-end, limited edition collectible figures, posters and vinyl records
Slide 6: Investing in the Rise of Pop Culture
INVESTING IN THE RISE OF POP CULTURE Ec 2017 | 2021 | | 2023 | Funkolaunches Launches FIRST POP! PRODUCT INITIAL PUBLIC a Bitty Pop! and Digital Pop! NFTs PRODUCED OFFERING Pop! Yourself Online Or: 2009 OBTAINS DISNEY | 2017 | | 2019 | 2022 LICENSES: Dz Funko completes cieetenieanealial Funko comple
Slide 7: We Believe That Everyone Is a Fan of Something
Wl oat Fale we Bevieve THAT EVERYONE ISA OF SOMETHING
Slide 8: Sampling of current portfolio offerings
Note: Represents a sampling of our current portfolio offerings as of December 2023. 8
Slide 9: 9
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Slide 10: We Have a Broad and Deeply Engaged Fanbase
WE HAVE A BROAD AND DEEPLY ENGAGED FANBASE CONSUMER COMPOSITION CONSUMER ENGAGEMENT Our products have broad appeal across age and gender. AGE RANGE 18-45 Social Media Following a6 Oo oa Total Total Total Total Total Followers: Followers: Followers: Followers: Followers: 1.7M 1.4M 44M 1M 1.2M Our cus
Slide 11: Global Distribution Across Multiple Channels
GLOBAL DISTRIBUTION ACROSS MULTIPLE CHANNELS Direct-to-Consumer is M s © our largest distribution Ue, ass Walmart >,< camera channel at 21%* = E-Comm amazon @) Walmart com Specialty HOTTOPIC GameStop BOXLUNCH > f ¢ 5 No single customer Walle B five BECW [>]fe) accounted for over 10%* of revenues Dis
Slide 12: Sales by category 2017 vs 2023
$1,200 $400 $300 $300 $300 $800 $200 $200 $200 $400 $100 $100 $100 $- $- $- $- 2017 2023 2017 2023 2017 2023 2017 2023 12
Slide 13: Net Sales and Adjusted EBITDA Margin
2017 2018 2019 2020 2021 2022 2023 2024* Net Sales Adjusted EBITDA Margin 13
Slide 14: Stabilize Operations, Focus, Add Revenue Streams, Build Growth
STABILIZE OPERATIONS Run the business like a lean startup, rejecting complexity Right-size inventory levels Invest only in the most critical IT Systems Optimize distribution center in Buckeye, AZ Reduce fixed-cost base Funk) FOCUS ON CORE PRODUCT LINES Focus on fewer products, done extremely well Pr
Slide 15: Strategy Elements: Stabilize Operations
STRATEGY ELEMENTS FOCUS ON Sue Et ed CORE PRODUCT OPERATIONS Eliminated extremely expensive short-term storage costs LINES Overhauled Funko’s Supply Chain: Improved order fulfill ment timelines and reduced labor costs Re-negotiated key freight and logistics contracts Lowered inventory levels by 54%
Slide 16: Simplify the business, focus on most profitable core products
Simplify the business, focus on most profitable core products + SKUs have been rationalized by approximately 30% Allowing us to be: Responsive to rapidly changing pop culture Quicker to market Nimble and creative in product design Evergreen product line + Core list of ~160 best-selling items to be c
Slide 17: Selectively invest in key value driving initiatives
Selectively invest in key value driving initiatives + Natural extensions of core product lines * Develop margin-accretive products like Pop! Yourself ($30 MSRP with no royalties) + Create product and customer segmentation opportunities with Bitty Pop! * Data driven approach Expand into new verticals
Slide 18: Strategy Elements: Build Long-Term Profitable Growth
STRATEGY ELEMENTS FOCUS ON ADD NEW BUILD STABILIZE LONG-TERM OPERATIONS RF INES STREAMS PROFITABLE 4 GROWTH Direct to Consumer (DTC) International Continue to Improve Customer Experience Expand beyond US and EMEA: Connect with Customers: + Latin America, Asia-Pacific, Australia, Canada - geographies
Slide 19: We Have an Experienced Management Team with a Deep Bench
WE HAVE AN EXPERIENCED MANAGEMENT TEAM WITH A DEEP BENCH MICHAEL YVES ANDY TRACY SARAH LUNSFORD LEPENDEVEN ODDIE DAW MARTINEZ Interim CEO ‘Acting CFO Chief Commercial Officer Chief Legal Officer Senior VP, People and Culture JOHANNA MARC HUSNAL MALCOLM ROB GEPFORD SIEGEL SHAH OTTLEY CASSIDY Senior V
Slide 20: Powerful pop culture platform with passionate fans
Powerful pop culture platform with passionate fans Results-oriented management team with a deep bench 20
Slide 21: Thank You
Vd THANK YOU
Slide 22: Adjusted EBITDA outlook reconciliation
A reconciliation of adjusted EBITDA and adjusted EBITDA margin outlook to the corresponding GAAP measures on a forward- looking basis cannot be provided without unreasonable efforts, as we are unable to provide reconciling information with respect to certain items. However, for the full year 2024 th
Slide 23: Adjusted EBITDA margin definition
*Adjusted EBITDA margin is defined as Adjusted EBITDA divided by Net Sales. 23
Slide 24: Reconciliation of Non-GAAP Financial Metrics Cont.
Reconciliation of Non-GAAP Financial Metrics Cont. f 1) Represents non-cash charges related to equity-based compensation programs, which vary from period to period depending on the timing of awards. (2) Represents monitoring fees paid pursuant to a management services agreement with ACON that was en