Roots Corp. · TSX:ROOT
Roots — Q1 2025 Earnings Presentation
21 slides from Roots's earnings presentation, Jun 13, 2025
Slide 1: Quarterly Summary Q1 2025
Quarterly Summary Q1 2025 June 13, 2025 PAGE 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain information in this presentation contains forward-looking information. This information is based on management’s reasonable assumptions and beliefs in light of the information currently available to us and are made as of June 12, 2025. Actual results and the timing
Slide 3: Our Mission
OUR MISSION To Inspire the World to be At Home with Nature PAGE 3
Slide 4: Our Roots
Our Roots Roots was founded in 1973 by Michael Budman and Don Green, who met at summer camp in Algonquin Park, where they first fell in love with the ideals and beauty of Canada. Starting from a little cabin, they were inspired by nature and Canada's wilderness to create Roots. With its uncompromisi
Slide 5: Iconic Canadian Brand with a Global Community
Iconic Canadian Brand with a Global Community 1 Rich heritage of delivering high-quality, versatile and stylish products to customers that span all ages and genders High-Quality, Versatile, Purpose-Driven Products 2 Mix of iconic classics and new pieces that resonate with customers Omni-Channel Stra
Slide 6: Our Values | What Guides Us
Our Values | What Guides Us Community Authenticity Integrity Freedom We are a place of inclusivity, diversity and open- While we draw inspiration from We always strive to do We celebrate the individuality of mindedness. the world around us, we never what’s right and to build style as a form of self-
Slide 7: Q1 2025 Financial Overview
Q1 2025 Financial Overview • Sales of $40.0M, a 6.7% increase compared to $37.5M last year o DTC sales were $34.6M, compared to $31.4M last year o DTC comparable sales growth was +14.1% • DTC gross margin improved 80bps year-over-year o DTC product margin increased by 270bps, driven by improved cost
Slide 8: Brand & Customer Engagement
Brand & Customer Engagement • Executed on multi-pronged marketing strategy with a focus on paid media, customer engagement, and elevating our brand messaging. • Partnered with Canadian NCAA basketball player, Toby Fournier of Duke University, to highlight our breadth of soft performance- based activ
Slide 9: Product Highlights
Product Highlights • Roots product continues to be recognized by consumers for its comfort, craftsmanship and premium materials. • Our key core fleece collections continue to stand out, with heritage and new styles resonating, further amplified by stronger in-stock positions year-over-year. • Strong
Slide 10: Operational Initiatives
Operational Initiatives • Strong results in automated replenishment system, enabling us to better align our product offering with customer demand • Adopting technology to offer personalized customer experience and efficiencies in customer service & returns. • Integration of advance technologies, lik
Slide 11: Q1 Sales Summary
Q1 Sales Summary Total Sales DTC Sales P&O Sales $37.5M $40.0M $34.6M $31.4M $6.1M $5.4M Q1-2024 Q1-2025 Q1-2024 Q1-2025 Q1-2024 Q1-2025 • DTC comparable sales grew 14.1%. • Sales drove double-digit growth across both • Sales decline to our international operating • P&O sales lower to last year driv
Slide 12: Q1 Gross Margin
Q1 Gross Margin Total DTC 62.1% 62.9% 61.5% 59.0% Q1-2024 Q1-2025 Q1-2024 Q1-2025 • DTC product margin expansion (+) • Improved DTC product costing and lower discount sales (+) • Increased mix of royalties from licensing of the Roots brand (+) • Partially offset by unfavourable foreign exchange impa
Slide 13: Drivers of Q1 DTC Gross Margin Expansion
Drivers of Q1 DTC Gross Margin Expansion Improved product costing and lower discounting (190) bps 270 bps 62.9% 62.1% Q1-2024 Product Margin Unfavourable FX and Q1-2025 Expansion Higher Freight Costs 80 basis points increase in DTC gross margin PAGE 13
Slide 14: Q1 SG&A Expenses
Q1 SG&A Expenses $0.8M $0.5M $33.3M $32.0M Q1-2024 Unfavourable Revaluation Higher Marketing Variable Selling Costs offset Q1-2025 of Cash-Settled DSUs Investments by Store Fleet Optimization • SG&A expenses increased 2.6% excluding the unfavourable DSU impacts (noted below), primarily reflecting hi
Slide 15: Drivers of Q1 Profitability Improvement
Drivers of Q1 Profitability Improvement Driven by improvements in sales and gross margin, and scaling of operating costs. ($7.4M) ($7.9M) $1.5M ($0.5M) ($8.9M) Q1-2024 Year-over-Year scaling Q1-2025 Unfavourable Revaluation Q1-2025 Net Loss through sales and costs Net Loss of Cash-Settled DSUs Net L
Slide 16: Q1 Adjusted Net Loss and Adjusted EBITDA
Q1 Adjusted Net Loss and Adjusted EBITDA Adjusted Net Loss (1) Adjusted EBITDA(1) ($7.4M) ($7.1M) ($8.1M) ($8.0M) Q1-2024 Q1-2025 Q1-2024 Q1-2025 (21.7%) of sales (18.4%) of sales (21.2%) of sales (17.8%) of sales Adj. Net Loss per Share Adj. Net Loss per Share ($0.20) ($0.18) (1) Adjusted Net Loss
Slide 17: Q1 Balance Sheet Highlights
Q1 Balance Sheet Highlights Net Debt(1) $65.9M Total Liquidity ~1.3x $31.7M $29.6M Leverage Ratio (1) $40.5M (14.5% YoY increase) Healthy Inventory Position 115K Common Shares Repurchased Q1-2024 Q1-2025 NCIB Buyback (1) Net Debt is a non-IFRS measure defined as long-term debt less cash (net of bank
Slide 18: Summary
Summary • Continue to execute on our strategic objectives while navigating through the dynamic environment. • Q1 marks our third quarter of consecutive growth in sales, gross margin, and Adj. EBITDA. • Balance sheet remains strong with low net debt leverage and ample liquidity. • Inventory is health
Slide 19: Appendix
Appendix PAGE 19
Slide 20: Non-IFRS Measures and Industry Metrics
Non-IFRS Measures and Industry Metrics This presentation makes reference to certain non-IFRS measures including certain metrics specific to the industry in which we operate. These measures are not recognized measures under International Financial Reporting Standards as issued by the International Ac
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