Slide 1: Coty Fourth Quarter FY19 Financial Results
COTY FOURTH QUARTER FY19 FINANCIAL RESULTS August 28, 2019
Slide 2: FY19 Profit and Cash Delivered as Planned
FY19 PROFIT AND CASH DELIVERED AS PLANNED Roadmap in Place STABILIZED MET FINANCIAL CLEAR FINANCIAL BUSINESS COMMITMENTS POLICY Resolved supply Regained control of Relevant financial policy chain disruptions profit and cash with a sustained dividend. which impacted flows 1H19 Service levels
Slide 3: Turnaround Plan: Solid Roadmap in Place
TURNAROUND PLAN Solid Roadmap in Place GROWTH Completed root cause analysis in Consumer Beauty Positive customer feedback Now deploying strategy to other countries OPERATIONAL Substantial value at stake in direct and indirect costs LEADERSHIP Savings opportunities in G&A Will provide mar
Slide 4: Next Step: Strengthening Our Innovation Pipeline
NEXT STEP Strengthening Our Innovation Pipeline 4
Slide 5: 4Q19 and FY19 Revenues: Results In-line with Expectations
4Q19 AND FY19 REVENUES Results In-line with Expectations LFL NET REVENUE TREND 4Q FY • 4Q19 revenue trend in-line with full year -3.5% -4.1% • Strong Luxury LFL, offset by Consumer and Professional Beauty divisions ADJUSTED OPERATING MARGIN • Gross margin and continued +30 bps 12.2% cost control dro
Slide 6: Luxury Brand Highlights
DAISY LOVE MARC JACOBS EAU SO SWEET BURBERRY | = = LUXURY BRAND HIGHLIGHTS
Slide 7: Luxury 4Q19 and FY19 Results
LUXURY 4Q19 AND FY19 RESULTS Strong Topline and Profit Growth LFL NET REVENUE TREND ALMEA, particularly China, and Travel Retail 4Q FY strong growth contributors for FY19 5.8% Strong growth in Burberry, Gucci, and Calvin Klein 4.7% Successful relaunch of Gucci makeup in May, starting with lips
Slide 8: Consumer Beauty Brand Highlights
8 CONSUMER BEAUTY BRAND HIGHLIGHTS 8
Slide 9: Consumer Beauty 4Q19 and FY19 Results
CONSUMER BEAUTY 4Q19 AND FY19 RESULTS Continued Topline Pressure, Focus on Building Healthier Base Q4 and FY19 sell-out down high single digits ALMEA revenues rose single digits primarily on Brazil strength ADJUSTED OPERATING MARGIN Currently, increasing working media on priority brands 10.4%
Slide 10: Professional Beauty Brand Highlights
PROFESSIONAL BEAUTY BRAND HIGHLIGHTS 10
Slide 11: Professional Beauty 4Q19 and FY19 Results
PROFESSIONAL BEAUTY 4Q19 AND FY19 RESULTS LFL Below Long Term Trend, Improving Profitability LFL REVENUE TREND One-off trade inventory de-stocking at 4Q FY key customers negatively impacted 4Q ghd continues to exhibit strong growth -1.7% across geographies Strong margin expansion despite -3.1%
Slide 12: Strong E-Commerce Momentum Across All Divisions
STRONG E-COMMERCE MOMENTUM Across all divisions E-Commerce Penetration (% of Net Revenues, excludes Younique) 14% >30% Rev ~30% Rev Growth 12% Growth >30% Rev Growth 10% High single digits penetration 8% Mid single digits >25% Rev penetration 6% Growth 4% 2% Luxury Consumer Beauty Professional Beaut
Slide 13: 4Q19 P&L Focused on Profit Delivery
4Q19 P&L FOCUSED ON PROFIT DELIVERY Gross margin up, driven by Luxury Adjustment of A&CP and strong fixed cost reduction Adjusted operating margin strongly up Solid EPS delivery Adjusted Gross Margin Adjusted Operating Margin Adjusted EPS 62.1% 12.2% $0.16 61.9% $0.14 10.0% 4Q18 4Q19 4Q18 4Q
Slide 14: FY19 P&L Focused on Profit Delivery
FY19 P&L FOCUSED ON PROFIT DELIVERY Gross margin down on supply chain disruptions Strong fixed cost reduction and A&CP reallocation Adjusted operating margin up 30 bps, with strong Luxury and Professional Beauty delivery Adjusted EPS broadly stable at constant FX Adjusted Gross Margin Adjust
Slide 15: Strong FY19 Free Cash Flow Growth
STRONG FY19 FREE Adj Operating Income 4Q19 258 FY19 951 CASH FLOW GROWTH Depreciation Adj EBITDA 100 358 379 1,329 Deleveraging Remains Noncash Addbacks 43 92 a Top Priority Working Capital (incl one-off costs) Capex (96) (96) (423) (427) Interest (Cash) (95) (248) FY19 FCF up significantly YoY Ta
Slide 16: Key Recent Developments
KEY RECENT DEVELOPMENTS Announced Turnaround Plan on July 1st, 2019 Credit agreement amended to align with our deleverage target and provide operational flexibility Exit of Younique to increase focus on core categories $3.9B asset impairment, primarily related to Consumer Beauty, reflecting
Slide 17: FY20 Outlook: Solid Dynamics
FY20 OUTLOOK Solid Dynamics LFL NET REVENUES Stable to slightly down YoY ADJUSTED OI +5-10% YoY (At Constant Scope Strong A&CP reinvestment and Currency) ADJUSTED EPS Mid-single digit growth YoY FREE CASH FLOW Moderate improvement YoY
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Slide 19: Disclaimer
DISCLAIMER Forward-Looking Statements Certain statements in this presentation are forward-looking statements. These forward-looking statements reflect Coty Inc.’s (“Coty’s”) current views with respect to, among other things, Coty’s Turnaround Plan, strategic planning, targets, segment reporting and