Coty Inc. · NYSE:COTY
Coty — Investor Day (November 2021)
83 slides from Coty's investor day presentation, November 2021
Slide 1: Accelerating Luxury Fragrances, Prestige Make Up and Skin Care
ACCELERATING LUXURY FRAGRANCES, PRESTIGE MAKE UP AND SKIN CARE I S A B EL L E B O N F AN TI, C O N S TAN TIN S K L A VEN ITIS & A N DR EW S T A N LE ICK 1
Slide 2: Prestige beauty category consistently resilient, increasing share of total beauty
THE PRESTIGE BEAUTY CATEGORY HAS BEEN CONSISTENTLY RESILIENT AND CONTINUES TO INCREASE ITS PERCENTAGE IN TOTAL BEAUTY CAGR 2021- 2025: 48% +6.7% CAGR 2006- 2019: +3.1% 45% 43% 2006 2019 2025 % OF TOTAL BEAUTY Source: Euromonitor 2
Slide 3: Coty global leader in fragrances with potential in other categories
COTY IS A GLOBAL LEADER IN FRAGRANCES WHILE ALSO HOLDING HUGE POTENTIAL IN OTHER CATEGORIES CAGR 2021-2025: +7% +5% 2% 26% 4% 39% +8% 94% 35% +5% Fragrance Skincare Makeup Source: Euromonitor, Coty internal 3
Slide 4: Prestige Fragrance
PRESTIGE FRAGRANCE 4
Slide 5: Ambition to remain #1 in male and become #1 in female fragrances
OUR AMBITION IS TO REMAIN #1 IN MALE FRAGRANCES & BECOME #1 IN FEMALE FRAGRANCES ~$27.2B Total Market ~$13.3 B Total market #15 #2 #1 #15 14.1% 17.0% ~$1.1 B 0.5% Share of Market Share of Market 0.5% SOM Total market SOM FEMALE FRAGRANCES MALE FRAGRANCES HIGH-END Source: Coty internal 2019 for Male/
Slide 6: Maximize opportunities on leading and high growth markets
MAXIMIZE OPPORTUNITIES ON LEADING AND HIGH GROWTH MARKETS Travel Retail #2 #3 #1 16.0% 12.1% 20.2% Share of Market Share of Market Share of Market Source: Coty internal 2019 6
Slide 7: Working with the current creative elite of the world
WORKING WITH THE CURRENT CREATIVE ELITE OF THE WORLD 7
Slide 8: Making our portfolio the best known for consumers
MAKING OUR PORTFOLIO THE BEST KNOWN FOR CONSUMERS COTY LVMH L’OREAL PUIG 100% (91%) (90%) (89%) (92%) (89%) (82%) (84%) 80% AWARENESS (75%) (74%) (71%) (71%) (70%) 60% (59%) (46%) 40% Source: Prompted Awareness Fragrance Brands – EU5+US – Fine Fragrance barometer 2021 by MetrixLab 8
Slide 9: Most beautiful fragrance portfolio in the market
WE HAVE THE MOST BEAUTIFUL FRAGRANCE PORTFOLIO IN THE MARKET 9
Slide 10: Focused approach to prestige fragrance portfolio
FOCUSED APPROACH TO PRESTIGE FRAGRANCE PORTFOLIO CONCENTRATED BRAND PORTFOLIO KEY STRATEGIC CRITERIA TOP 6 Fashion-driven brands that can BRANDS become global powerhouses of prestige fragrance sales Multi-category potential Resonate in key focus markets like China 10
Slide 11: Globalizing Regional Heroes
GLOBALIZING REGIONAL HEROES Source: NPD panel FY21 11
Slide 12: Marc Jacobs Perfect
PERFECT MARC JACOB
Slide 13: Marc Jacobs
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Slide 15: Burberry Hero
BURBERRY HERO
Slide 16: Video Hero
VIDEO HERO Place holder GDM, LUXURY PLENARY SESSION
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Slide 19: Video Flora
VIDEO FLORA GDM, LUXURY PLENARY SESSION
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Slide 21: Rise of exclusive niche fragrances
RISE OF EXCLUSIVE NICHE FRAGRANCES Growth vs Total Market Growth vs Total Market Source: NPD & Beaute Research panels FY21 21
Slide 22: Coty growing in the high-end market
COTY GROWING IN THE HIGH-END MARKET
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Slide 25: Coty superiority in fragrances
COTY SUPERIORITY IN FRAGRANCES 25
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Slide 27: Prestige Skin Care
PRESTIGE SKIN CARE 27
Slide 28: Future portfolio addresses key beauty trends
FUTURE PORTFOLIO ADDRESSES 5 KEY BEAUTY TRENDS GREEN CLINICAL DERM-LED & CUTTING REGENERATIVE INFLUENCERS-LED MICROBIOME SCIENCE EDGE INGREDIENTS MEDICINE BRANDS SCIENCE Kim Kardashian West SKIN Skincare 28
Slide 29: Unique recognized expertise built over 75 years
A UNIQUE RECOGNIZED EXPERTISE BUILT OVER 75 YEARS Scientific #50 ACTIVE PATENTS and communications recent EXCITING NEW FILING preparing our FUTURE Scientific publications Years of visionary research into DNA & anti-oxydant Years of visionary research into oxygen Years of UV expertise and full light
Slide 30: We are building a leading skincare organization
WE ARE BUILDING A LEADING SKINCARE ORGANIZATION DR. SHIMEI FAN VÉRONIQUE SCHWARTZ Coty Chief Scientific Officer SVP Product Development 30
Slide 31: Goal: double-digit skincare growth and 100% clean, vegan, cruelty free
OUR GOAL IS TO DELIVER DOUBLE-DIGIT GROWTH IN SKINCARE INNOVATION & TRANSFORM PORTFOLIO TO BECOME 100% CLEAN, VEGAN & CRUELTY FREE BY THE END OF 2024
Slide 32: Lancaster Monaco
ZANCASTER MONACO
Slide 33: Upcoming Lancaster project in ultra-premium trend
UPCOMING LANCASTER PROJECT Preferred over TO EMBARK ON THE BOOMING ULTRA-PREMIUM TREND #1 market leader #2 market leader AMAZING RESULTS FOR 80% OF CHINESE WOMEN WHO TRIED IT
Slide 34: Master skin barrier science
MASTER SKIN BARRIER SCIENCE DISTRIBUTED IN THE MOST SELECTIVE ULTRA-PREMIUM DOORS ACROSS 15 COUNTRIES
Slide 35: Tackling the indie market
TACKLING THE INDIE MARKET
Slide 36: FY23 is the year of skincare for Coty
FY23 IS THE YEAR OF SKINCARE FOR COTY Kim Kardashian West Skincare SKIN 36
Slide 37: Prestige Makeup
PRESTIGE MAKEUP
Slide 38: Growing couture segment confirms potential for Gucci and Burberry
THE GROWING COUTURE MARKET SEGMENT CONFIRMS THE POTENTIAL FOR GUCCI & BURBERRY WHILE INDIES FOR KYLIE COUTURE INDIES MAKEUP ESTABLISHED ARTISTS BRANDS 2014 11% 21% 27% 31% 2019 15% 24% 22% 22% 2025 21% 25% 15% 14% Source: NPD & Beaute Research panels FY data % of the market (value sales) 38
Slide 39: High-end fashion combined with playfulness
HIGH-END FASHION COMBINED WITH PLAYFULNESS REACHING THE TOP IN KEY RETAILERS THANKS TO INNOVATIVE PRODUCTS AND POWERFUL PACKAGING
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Slide 42: Heroing all beauties with an armour of extraordinary
HEROING ALL BEAUTIES WITH AN ARMOUR OF EXTRAODINARY TO EXPLORE THE WORLD WITH CONFIDENCE
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Slide 44: New, profitable business model for couture and indie brands
NEW, PROFITABLE BUSINESS MODEL FOR COUTURE AND INDIE BRANDS OLD BUSINESS MODEL Numerous counters New, Profitable Business Model NEW BUSINESS MODEL Fewer stores Online business Lower CAPEX 44
Slide 45: Andrew Stanleick
ANDREW STANLEICK 45
Slide 46: Kylie's phenomenal trajectory
KYLIE’S PHENOMENAL TRAJECTORY 1 How The Brand Started 2 Kylie I The Queen of Social 3 Full Relaunch and Expanded Reach 4 The Making of a Mega-Brand 46
Slide 47: How the brand started
HOW THE BRAND STARTED 47
Slide 48: The lip kits that started it all
THE LIP KITS THAT STARTED IT ALL From lip insecurity to lip segment breakthrough An all-in-one kit, with matching liner and liquid lipstick, to define, line and fill lips Day one: November 30, 2015 45k units 3 shades sold out in minutes …and the rest is history 48
Slide 49: Queen of Social
KYLIE JENNER KYLIE ALLEL AEE
Slide 50: Most followed female in the world @kyliejenner
MOST FOLLOWED FEMALE IN THE WORLD @KYLIEJENNER AS OF SEPTEMBER 2021, KYLIE IS THE MOST FOLLOWED FEMALE ON INSTAGRAM & 3RD MOST FOLLOWED PERSON GLOBALLY IG followers evolution Sept 2020 196M Sept 2021 271M +75M followers (+38%) 50
Slide 51: @kyliejenner on TikTok is growing exponentially
@KYLIEJENNER ON TIKTOK IS GROWING EXPONENTIALLY 37.4M FOLLOWERS I +2M GAINED IN LAST 8 WEEKS 51
Slide 52: Kylie continues to break views and engagement records
KYLIE CONTINUES TO BREAK VIEWS & ENGAGEMENT RECORDS VOGUE ‘73 QUESTIONS’ VIDEO INTERVIEW ▪ Broke all Vogue engagement records ▪ 6M+ views in the first 24 hours ▪ 9K views per minute ▪ #1 trending video on YouTube KYLIE BABY PREMIERE VIDEO ▪ 27M+ views overall ▪ 15M+ views in 24 hours 52
Slide 53: Progress since partnering
PROGRESS SINCE PARTNERING 53
Slide 54: New makeup line created in the midst of a pandemic
WE CREATED A NEW & EXCITING MAKE-UP LINE IN THE MIDST OF A PANDEMIC Clean. Cruelty Free. Gluten Free. Vegan Stunning new packaging 347 SKUs, 10M units created New agile ‘Collections Drop’ model All within 12 months! 54
Slide 55: New website alongside seamless in-store brand experience
WE LAUNCHED A NEW WEBSITE ALONGSIDE A SEAMLESS IN-STORE BRAND EXPERIENCE 55
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Slide 58: Kylie Cosmetics Relaunch
58 KYLIE COSMETICS RELAUNCH
Slide 59: 24K Birthday Collection
INSERT PICTURE OF TIMES SQUARE AND LA BILLBOARD FOR BIRTHDAY SAME STYLE AS PREVIOUS PAGE 59 24K BIRTHDAY COLLECTION
Slide 60: 24K Birthday Collection
60 24K BIRTHDAY COLLECTION
Slide 61: Kylie Baby
61 KYLIE BABY
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Slide 63: Kylie x Nightmare on Elm Street
KYLIE x NIGHTMARE ON ELM STREET
Slide 64: Kylie x Nightmare on Elm Street
64 KYLIE x NIGHTMARE ON ELM STREET
Slide 65: Kylie remains an active founder
KYLIE REMAINS AN K ACTIVE FOUNDER • BRAND ASSET CREATIVE DIRECTOR • PRODUCT DEVELOPMENT LEADER ACROSS ALL CATEGORIES • KEY RETAILER ENGAGEMENT TITLE OF THE PRESENTATION 65
Slide 66: Our vision
SN SS SS ~ aw. ( KYLIE KYLIE JENNER
Slide 67: Our vision: a destination for glam
OUR VISION: A DESTINATION FOR GLAM Kylie is an omni-channel global beauty destination With an innovative multi- category offering Kylie Beauty will become a Global Mega-Brand 67
Slide 68: Strategic priorities
3 STRATEGIC PRIORITIES BUILD STRONG 1 2 STRENGTHEN 3 OVERDRIVE IN GLAM PILLARS GLOBAL PRESENCE SOCIAL & INFLUENCE COSMETICS SKIN 68
Slide 69: Build strong glam pillars
1 BUILD STRONG GLAM PILLARS 69
Slide 70: Conquer makeup, accelerate skin, expand the glam tool box
CONQUER ACCELERATE EXPAND THE MAKEUP SKIN GLAM TOOL BOX COMING SOON 70
Slide 71: Collections remain key to driving recruitment, buzz and revenue
COLLECTIONS REMAIN KEY TO DRIVING RECRUITMENT, BUZZ AND REVENUE NEW SOCIAL WINDOW INTO PRODUCT LAB ACCELERATOR KYLIE’S MAKEUP VISION 71
Slide 72: Strengthen global presence
2 STRENGTHEN GLOBAL PRESENCE 72
Slide 73: Omni-channel commercial strategy
OMNI-CHANNEL COMMERCIAL STRATEGY DTC FIRST KEY RETAILERS ULTRA PREMIUM PREMIUM PLUS PREMIUM ACCESSIBLE 73
Slide 74: Launched the Kylie DTC experience in 5 markets
WE LAUNCHED THE KYLIE DTC EXPERIENCE IN 5 MARKETS 74
Slide 75: Continue to expand the global retail footprint
WE CONTINUE TO EXPAND THE GLOBAL RETAIL FOOTPRINT 27 MARKETS, 10 RETAILERS, 3,500+ B&M DOORS I COTY HAS ADDED +2,500 ACROSS 3 CONTINENTS SINCE 2019 RUSSIA EUROPE & UK 21 DOORS 1,796 DOORS N. AMERICA 1,569 DOORS AUS 76 DOORS 75
Slide 76: Overdrive in social and influence
3 OVERDRIVE IN SOCIAL & INFLUENCE 76
Slide 77: Overdrive in social and influence
OVERDRIVE IN SOCIAL & INFLUENCE 77
Slide 78: The journey has just begun
THE JOURNEY HAS JUST BEGUN 78
Slide 79: Coming end FY22
COMING END FY22… 79
Slide 80: Toward a more balanced prestige beauty business
ON THE WAY TO A MORE BALANCED PRESTIGE BEAUTY BUSINESS WITH SKINCARE AND MAKEUP EXPANSION % of Total Coty FY19 FY21 FY25 Net Revenues PRESTIGE FRAGRANCES 51% 51% Mid 40% PRESTIGE High 4% 5% SKINCARE single digits PRESTIGE MAKEUP - 3% ~10% 80
Slide 81: Strong sales and profit growth for Prestige
STRONG SALES AND PROFIT GROWTH FOR PRESTIGE FY21 FY22E FY22-FY25E NET REVENUE HSD LFL $2.7B High-teens LFL / LFL SALES CAGR Growth Growth ADJ EBITDA $504M outpacing sales outpacing sales ADJ EBITDA Several Points 18.5% Expansion MARGIN of Expansion 81
Slide 82: Key takeaways for our Prestige business
Targeting leadership position in female fragrances, while keeping number one position in male fragrances Aiming to become a top player in the highly profitable niche fragrance segment Leveraging key brands in the two fastest growing and KEY TAKEAWAYS most profitable segments for prestige makeup cate
Slide 83: 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, strategic planning, targets