Traeger, Inc. · NYSE:COOK
Traeger — Q1 2022 Earnings Presentation
35 slides from Traeger's earnings presentation, Jul 23, 2022
Slide 1: Investor Presentation First Quarter 2022
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT 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, incl
Slide 3: Press coverage of Traeger's new Timberline grill
POPULAR SCIENCE CONSUMER TECH Traeger’s new Traeger’s All-New Timber] g 1 , imberline series TRAEGER"S NEW ” Provides The Ultimate Outc 7 m TIMBERLINE GRILL Gaeta ghana grills can cook UPGRADES WOOD : 8 pretty much PELLET COOKING WITH anything outside TOUCHSCREENS AND A : : “FREEFLOW’ FIREPOT = GEAR
Slide 4: CEO Commentary
CEO Commentary "Despite the headwinds that we faced in the first quarter, we are pleased to report better than expected revenue and adjusted EBITDA for the quarter. During the first quarter, we continued to execute on our strategic growth pillars. We successfully introduced our new platform of innov
Slide 5: Traeger 1st Quarter at a Glance
AN TRAEGER 1st QUARTER AT A GLANCE Revenue Mix $224MM 37.4% Revenue Gross Margin S3IMM 13.8% Adj. EBITDA © Adj. EBITDA Margin © oh TRAEGER
Slide 6: Growth Pillars: Quarterly Highlights
GROWTH PILLARS: QUARTERLY HIGHLIGHTS Accelerate Brand Awareness and Penetration + Expanded assortment of Traeger products at ~350 Home Depot doors * Launched a new brand campaign, Traegerhood Tales, with TV spots and digital ads * Traeger.com US saw strong topline growth in QI 22 Disrupt Outdoor Coo
Slide 7: Investment Highlights
INVESTMENT HIGHLIGHTS DISRUPTOR IN THE OUTDOOR CoeKING CATEGORY as the market leader in the share-gaining Wood Pellet Grill segment F 7 . ji Ot . % id ‘ ‘ 2. AUTHENTIC AND INVITING BRA iD’ ti eens! and vist eral assion, embodied in our diverse community of advocates: THE. ‘ Ae Sy 3. RECURRING REVENU
Slide 8: Section 1: Brand, Product and Industry
BRAND, PRODUCT AND INDUSTRY
Slide 9: Traeger at a Glance
ee || TRAEGER AT A GLANCE FY 2021 Revenue Mix "Grills "Accessories = Consumables FY2019 Ah TRAEGER Grills Installed Base (MM) FY2020 25 Fy2021 $786MM FY 202I Revenue SIOOSMM FY 2021 Adj. EBITDA (lOMM Cooks in 2021 44% FY 202I Revenue Growth 14% FY 2021 Adj. EBITDA Margin © 1.7MM Instagram & Facebook
Slide 10: Traeger's U.S. Market Opportunity
TRAEGER’S U.S. MARKET OPPORTUNITY TRAEGER =e —a TOTAL U.S. HOUSEHOLDS Current Penetration 2% TRAEGER U.S. TAM Total U.S. Households that own a grill as of 2021 Current Penetration 3.5% TRAEGER U.S. SAM Total U.S. Households that value Traeger’s differentiated quality, technology and convenience, acc
Slide 11: Our Market Opportunity
OUR MARKET OPPORTUNITY total U.S. spend on food at home in 2021 of consumers plan to spend the same or more on their next grill purchase U.S. households own a grill, with second grill purchases rising in popularity grill replacement rate, on average Sources: US Census Bureau (2021), US Bureau of Eco
Slide 12: Wood Pellet Grills Are Disrupting the Market
WOOD PELLET GRILLS ARE DISRUPTING THE MARKET WITH TRAEGER AS THE CATEGORY LEADER Barbecue Grill - Dollar Share by Fuel Type 80% GAS GRILLS 70% GAS GRILL MARKET HAS Cex BEEN IN LONG-TERM DECLINE 50% 40% 30% CHARCOAL GRILLS 20% WOOD PELLET GRILL 10% CATEGORY DOUBLED SHARE SINCE 2017 PELLET GRILLS 0% 2
Slide 13: The Traegerhood
THE TRAEGERHOOD 47 number of cooks for the average owner on their Traeger in 2021 5 number of people the average Traeger owner recommends the brand to, as compared to 2 for non-wood pellet grills 75% estimated percent of Traeger owners that believe the brand reflects who they are as people PIM sourc
Slide 14: The Largest Social Media Community of Any Grilling Brand
THE LARGEST SOCIAL MEDIA COMMUNITY OF ANY GRILLING BRAND TRAEGER 1.7 MILLION FOLLOWERS ACROSS FACEBOOK AND INSTAGRAM IN 2021, OUR FACEBOOK AND INSTAGRAM FOLLOWING GREW 20%, AND ORGANIC IMPRESSIONS GREW 29% 400 THOUSAND POSTS RECORD USER GENERATED CONTENT IN 2021 14
Slide 15: Our Secret Sauce: Organic and Authentic Brand Position
OUR SECRET SAUCE: WE HAVE AN ORGANIC AND AUTHENTIC BRAND POSITION a: | , ae COMMUNITY RETAIL COMMUNITY SOCIARM IBIS: AMBASSADORS CONTENT Ah TRAEGER
Slide 16: Section 2: Growth Thesis
GROWTH THESIS
Slide 17: Growth Pillars
GROWTH PILLARS 1) Accelerate Brand Awareness and Penetration e Disrupt Outdoor Cooking with Product Innovation 6 Drive Recurring Revenue 4 ) Expand Traeger Brand Globally Ih TRAEGER
Slide 18: Accelerate Brand Awareness and Penetration
@ ACCELERATE BRAND AWARENESS... Traeger Household Penetration by State Business has Utah’s household penetration, which is the highest for the brand, more than doubled from in 2018 to 16% in 2021 © => 10% @ = 5%10% @ =2%5% @ = 0%-2% Source: Company Estimates Note: Traeger household penetration as of
Slide 19: Invest to Maximize Retail Productivity
AND PENETRATION Invest to Maximize Retail Productivity * Partner with retailers willing to invest in Traeger footprint * Investing alongside retail partners into premium merchandise and expansive product assortment * Deliver authentic in-store merchandising experiences that are optimized for convers
Slide 20: Disrupt Outdoor Cooking with New Innovations
DISRUPT OUTDOOR COOKING WITH NEW INNOVATIONS Pt Induction CO! Pop & Lock (PAL) y | oo FORRES Access} Accessory Rail gpper Bs: diSspout Grease & Ash Collection Front Close Cabinet Doors” cooking hal Ih TRAEGER 20
Slide 21: Drive Recurring Revenue Through Consumables Business
e DRIVE RECURRING REVENUE THROUGH CONSUMABLES BUSINESS TRAEGER 17% of sales in 2021 Driving consumables revenue through expanded distribution and new product launches Strengthening portfolio margins and driving excitement through a recurring Limited Edition Pellets strategy In Ql 2022, we added 2,20
Slide 22: Expand Internationally
© EXPAND INTERNATIONALLY Revenue from Rest of World International busines over year in FY 202 2% FY 2019 FY 2020 Note: Rest of World excludes North America IN TRAEGER FY 2021
Slide 23: Section 3: Channels and Supply Chain
CHANNELS AND SUPPLY CHAIN
Slide 24: Our Omnichannel Sales Strategy Creates an Authentic Experience
OUR OMNICHANNEL SALES STRATEGY CREATES AN AUTHENTIC EXPERIENCE FOR NEW CUSTOMERS AND THE TRAEGERHOOD CHANNEL BREAKDOWN FY 2021 4 TRAEGER.com E-Commerce, 8% DTC, 10% Retail, 82% Note: Channel breakdown based on % of revenue AN TRAEGER WE METHODICALLY BUILD RELATIONSHIPS WITH OUR DISTRIBUTION PARTNERS
Slide 25: Our Diverse Grill Supply Chain Continues to Grow
OUR DIVERSE GRILL SUPPLY CHAIN CONTINUES TO GROW Manufacturing and Supply Chain Update * Mexico facility planned to open for mass production in 2022 ¢ Evaluating other opportunities to bring manufacturing closer to the US * Product team maximizing efficiency in design to drive margin ¢ Internal task
Slide 26: Financials
FINANCIALS
Slide 27: Q1 2022 Financial Results
Note: Q1 2022 Total Revenue and Accessories Revenue includes MEATER
Slide 28: Q1 2022 Financial Results (continued)
Note: Q1 2022 Total Revenue and Accessories Revenue includes MEATER
Slide 29: Q1 2022 Results Including MEATER
Note: Q1 2022 results include MEATER
Slide 30: FY 2022 Guidance
FY 2022 GUIDANCE GIVEN THAT OUR FIRST QUARTER REVENUES BENEFITED FROM A SHIFT IN THE TIMING OF GRILL SHIPMENTS, AS WELL AS OUR BELIEF THAT THE MACRO BACKDROP WILL REMAIN VOLATILE FOR THE BALANCE OF THE YEAR, WE ARE REITERATING OUR PRIOR 2022 OUTLOOK DESPITE REPORTING FIRST QUARTER RESULTS AHEAD OF O
Slide 31: Gross Margin Bridge: FY 2019 vs. FY 2021 vs. FY 2022 Guidance
Gross Margin Bridge: FY 2019 vs. FY 2021 vs. FY 2022 Guidance GROSS MARGIN 42.9% 38.7% — 34-35% FY 19 Actual Grill Price Grill Cost & Mix FX Freight & Other FY 21 Actual Grill Price Grill Cost & Mix Freight & Other FY 22 Guidance Logistics Logistics FACTORS IMPACTING FY 22 GROSS MARGIN GUIDANCE * SI
Slide 32: Appendix
APPENDIX TRAEGER
Slide 33: Footnotes
FOOTNOTES |. Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures. See the appendix to this presentation for a presentation of, and a reconciliation of these measures to, the nearest comparable GAAP measures, including Net Income (Loss) and Net Income (Loss) Margin, respectively. 2. Base
Slide 34: Information Regarding Non-GAAP Financial Measures
INFORMATION REGARDING NON-GAAP FINANCIAL MEASURES In addition to our results and measures of performance determined in accordance with U.S. GAAP, we believe that certain non-GAAP. financial measures are useful in evaluating and comparing our financial and operational performance over multiple period
Slide 35: Non-GAAP Reconciliation Notes
Notes: 1. Represents gains (losses) on disposal of property, plant, and equipment, impairments of long-term assets, and unrealized gains (losses) from derivatives 4. Represents expenses for legal and consulting costs incurred in connection with our IPO process 2. Represents external legal expenses f