Deckers Outdoor Corporation · NYSE:DECK
Deckers Outdoor — ICR XChange 2013
32 slides from Deckers Outdoor's conference presentation, January 2013
Slide 1: Deckers Outdoor Corporation
Deckers Outdoor Corporation ICR XChange January 2013
Slide 2: Safe Harbor
We make forward-looking statements in this presentation which represent our expectations or beliefs about future events and Safe Harbor financial performance. Forward-looking statements are identifiable by words such as “believe,” “anticipate,” “expect,” “intend,” “plan,” “will,” “may” and other sim
Slide 3: Brand Portfolio
Brand Portfolio Brand LTM Net Sales at 9-30-12 84% Accessible luxurious comfort 9% Outdoor Performance 6% Action Sports 1% Emerging Brands
Slide 4: Overview
Overview • 2012 Was a Challenging Year • UGG Australia Brand Strength • Diversified Growth Strategy
Slide 5: 2012 Was a Challenging Year
2012 Was a Challenging Year • Impact of weather on the business • Difficult macroeconomic conditions in Europe • Record high sheepskin prices = Pressure on sales and margins
Slide 6: UGG Australia Strength
UGG Australia Strength UGG consideration, purchase rates, purchase interest and opinion have increased steadily since 2010 Among US Women who are aware of UGG 67% 61% 54% 51% 37% Feb 2010 32% 27% July 2012 24% % Considered % Ever Purchased Future Purchase % Rating "Excellent" Purchase Interest * or
Slide 7: UGG Australia Strength
UGG Australia Strength UGG has strong relevance, outpacing the competition “Is on its way up and is doing a lot/some different things at the moment” 57% 50% UGG Competitive Average Source: M+C Women's Quant Feb 2012 (Competitors: Michael Kors, Hunter, Cole Haan, Frye, Tory Burch & Coach)
Slide 8: UGG Australia Strength
UGG Australia Strength Facebook fans have increased steadily, doubling in the last year, to nearly 2 million 2,500,000 2,000,000 1,955,000 1,500,000 M 1,358,000 1,000,000 949,000 787,000 500,000 549,000 0 11/1/10 5/1/11 11/1/11 5/1/12 1/13/13 Source: facebook.com
Slide 9: UGG Australia Strength
UGG Australia Strength • #1 Online searched term during 2012 shopping season, beating out popular brands such as Apple and Amazon* • Ecommerce sales increased 24% over prior year on M Black Friday and Cyber Monday • Very important and profitable brand for all retailers *Source: Experian
Slide 10: UGG Australia Growth Strategy Drivers
UGG Australia Growth Strategy Drivers Continued expansion of products and categories Accelerate international growth Grow retail business Increase emphasis on integrated marketing
Slide 11: Continued Expansion of Products & Lifestyle Categories
Continued Expansion of Products & Lifestyle Categories Expand categories including heritage, casuals and casual boots Expand spring business Grow UGG for Men’s business Further develop handbags, apparel and accessories collections
Slide 12: Continued Expansion of Products & Categories: Heritage
Continued Expansion of Products & Categories: Heritage
Slide 13: Continued Expansion of Products & Categories: Women's
Continued Expansion of Products & Categories: Women’s
Slide 14: Continued Expansion of Products & Categories: Men's
Continued Expansion of Products & Categories: Men’s
Slide 15: Continued Expansion of Products & Categories: Kids'
Continued Expansion of Products & Categories: Kids’
Slide 16: Continued Expansion of Products & Categories: Handbags & Apparel
Continued Expansion of Products & Categories: Handbags & Apparel
Slide 17: Continued Expansion of Products & Categories: Shop in Shops
Continued Expansion of Products & Categories: Shop in Shops Mitsukoshi Taichung, Taiwan Englin’s Fine Footwear, Indianapolis
Slide 18: Continued Expansion of Products & Categories: Shop in Shops
Continued Expansion of Products & Categories: Shop in Shops Expand shop-in-shops Drive 35% to 50% increase in sales to showcase product range Showcase 100 styles Currently 380 total shop-in-shops vs. 40 styles at typical account worldwide
Slide 19: Accelerate International Growth
Accelerate International Growth 70% Deckers owned 30% distributor owned Increase penetration of entire product line in subsidiary markets Establish additional subsidiaries in key developed markets Establish/grow 3rd party distributors in less-developed markets Continue to develop subsidiaries’ infra
Slide 20: Asia: Significant Growth Opportunity
Asia: Significant Growth Opportunity • Assumed Japanese distribution in 2009 and acquired minority interest in China JV in early 2012 • Japan sales grew approximately 80% in 2012 driven by expansion of wholesale and retail operations and the launch of ecommerce website - # 3 international market • C
Slide 21: Europe: Still Challenging
Europe: Still Challenging • Assumed U.K. and Benelux distribution in 2011 - # 1 and # 2 international markets • Warm 2011/2012 and challenging macroeconomic conditions created headwinds • Significant progress in the U.K. through rationalizing distribution and improving infrastructure, next tackling
Slide 22: Grow Retail Business
Grow Retail Business Store Count 2012 Location Concept Outlet Total US 15 11 26 Canada 2 1 3 EMEA 9 5 14 Japan 12 2 14 China 18 2 20 Total 56 21 77 Profitable with accretive margins, fast paybacks and strong sales per square foot Opened 30 stores in 2012 By 2015, 200 stores
Slide 23: Strong Retail Store Economics
Strong Retail Store Economics • Average concept store is approximately 2,800 square feet • Sale per square foot on trailing twelve month basis was $1700* • Average store investment = $1 million • 1 year payback period • Going forward: Smaller stores and lower CapEx investment * As of September 30, 2
Slide 24: Grow Retail Business
Grow Retail Business Piccadilly, United Kingdom UGG For Men, Madison Avenue, New York Seoul, Korea
Slide 25: Increase Emphasis on Marketing
Increase Emphasis on Marketing Increased marketing spend in 2012 to over 5% of sales vs. 4% in 2011 Aggressive UGG for Men marketing program Reaching and converting prospects Grow and refine social media strategy and management Fully integrated campaigns
Slide 26: Integrated Marketing: Holiday Campaign
Integrated Marketing: Holiday Campaign Online In-Store Outdoor Digital
Slide 27: Growth strategy: Teva brand
Growth strategy: Teva brand Repositioned as the innovation leader in the Outdoor Footwear Market, inspiring adventure on water and trail A year-round product offering with superior wet weather technology Build brand loyalists among younger, active consumers by focused integrated marketing support in
Slide 28: Teva Product Diversification
Teva Product Diversification
Slide 29: Growth Strategy: Sanuk brand
Growth Strategy: Sanuk brand Expand year ‘round product offering Global Expansion New Consumers Direct to Sanuk Consumer and ecommerce Build Brand Awareness
Slide 30: Sanuk Product Assortment
Sanuk Product Assortment
Slide 31: Key investment highlights
Key investment highlights Own $1 billion+ UGG brand and six other non-competing lifestyle brands Meaningful domestic growth opportunities Significant international potential Growing direct-to-consumer business Solid earnings, cash flow and strong balance sheet
Slide 32: Thank you.
Thank you. Visit www.deckers.com/investors for more info.