Duluth Holdings Inc. · NASDAQ:DLTH
Duluth — Q1 2022 Earnings Presentation
23 slides from Duluth's earnings presentation, Jun 3, 2022
Slide 1: Investor Presentation First Quarter 2022
DTH TRADING —<"C 0 > Investor Presentation First Quarter 2022 June 3, 2022
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation dated June 3, 2022 includes “forward-looking statements” within the meaning ofthe Private Securities Litigation Reform Act of 1995. Allstatements, other than statements of historical facts included in this presentation, including statements con
Slide 3: Introduction to Duluth Trading Co.
INTRODUCTION TO DULUTH TRADING CO.
Slide 4: There's Always Gotta Be a Better Way
THERE’S ALWAYS GOTTABE A BETTER WAY Duluth Trading Co. was founded on the belief that there’s always a better way to be found. A better way to solve. A better way to make. A better way to be. We're on a mission to build better, harder-working apparel and gear that helps enable everyone from the youn
Slide 5: Better Brands, Innovation, Marketing, Experiences, Distribution
Better Brands A brood of sub-brands all bonded by the belief that you can accomplish anything that you put your own mind and own two hands to Better Innovation Long, colorful history of product innovation and solution-based design Better Marketing Distinctive marketing made to break through the clut
Slide 6: Brand Positioning
Brand Positioning @ Common Brand Values e@ Common Target Customers for Both Men and Women e@ Unique Sub-Brands for Unique End Uses DuwtH Duluth buildshardworking apparel and gearfor hardworking men and women wholive alife of doing. Ingenious, solution- filled gear that’s designed andtested to one-up
Slide 7: Financial Review
FINANCIAL REVIEW
Slide 8: Financial Highlights
Financial Highlights e Net sales of $122.9M compared to $133.4M in the prior year first quarter e Gross profit margin improved 470 basis points to 54.6% compared to 49.9% in the prior year first quarter » Net loss of ($1.3M), or ($0.04) per diluted share, compared to net income of $0.5M, or $0.02 pe
Slide 9: Three Months Ended May 1, 2022
Three Months Ended May 1, 2022 $133.4 (7.9)% a $122.9 45 2021 2022 2021 2022 (5/2/2021) (5/1/2022) (5/2/2024) (5/1/2022) m Retail Direct 49.9% Margin 54.6% Net Sales Gross Profit (Sin millions) (Sinmillions) + Adjusted to reflect the add-back of stock compensation expense, + Excludes net lose) incom
Slide 10: Net Sales and Adjusted EBITDA
Net Sales and Adjusted EBITDA e Strong track record of 15% Net Sales and 15% Adjusted EBITDA growth e Strategic investments and operating efficiencies support long-term objectives of accelerated earnings growth 2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021 Net Sales Adjusted
Slide 11: Strong Balance Sheet, Liquidity and FCF
Strong Balance Sheet, Liquidity and FCF Debt to Capital) Free Cash Flow (Sin millions) As of May 1, 2022 Cash $40.4 Debt: Line of Credit 0.0 Term Loan 0.0 Total Debt 0.0 Total Shareholders’ Equity $224.6 Total Capitalization $265.0 Debt to Capital ratio 0.0% 1 Balances de ntincde TA Holings, LC, ova
Slide 12: Long-Term Financial Targets
Long-Term Financial Targets 2022 2025 ($in millions) itlook Targets Net Sales $568.1 $615.6 $638.8 $698.6 $730 - $755 $1.0B Operating Margin % 6.5% 4.6% 3.8% 6.3% 6.3 - 6.6% 9- 10% Adj. EBITDA % 9.1% 8.4% 8.6% 11.1% 11.5 -11.7% 14 - 15% Free Cash Flow ($21.9) ($22.4) $38.5 $81.6 $15 - $20 Positive J
Slide 13: Fiscal 2022 Financial Guidance
Fiscal 2022 Financial Guidance snmtoms | 2022 | 2022 Guidance Reconciliation to 2022 Forecasted Adj. EBITDA Fiscal Year Ended January 29, 2023 Net Sales $698.6 $730 to $755 a 44.5% to 48.1% Forcasted (Sin millions) Low High Net Income $30.8 $33.5 +) Depreciation and amortization 32.2 32.6 Adj. S774
Slide 14: Investment Highlights
Investment Highlights e Growing lifestyle platform of sub-brands with well-established digitally-led omnichannel business e Multiple revenue growth opportunities led through five strategic pillars e Strategic investments support long-term EBITDA margin expansion e Generating positive cash flow with
Slide 15: Growth Blueprint
BG DAM BLUEPRINT
Slide 16: Our Multi-Brand Platform and Owned DTC Channels
3 OurMutti- Optimize Our nd Platform Owned DTC Chann
Slide 17: Lead With a Digital-First Mindset
Lead With a Digital-First Mindset e e Transform Duluth into a digitally-led organization integrating data and digital technology into all areas of our business, fundamentally changing how we operate and deliver value to customers e Our digital transformation will provide the structure for how we pri
Slide 18: Intensify Efforts to Optimize Our Owned DTC Channels
Intensify Efforts to Optimize Our e Owned DTC Channels e Increase our focus and investments in our direct channel as our primary growth vehicle e@ Our customer places a high value on our stores and they will continue to serve asa critical piece of the omnichannel ecosystem: » Convenient touchpoint f
Slide 19: Evolve our Multi-brand Platform as a New Pathway to Grow the Business
Evolve our Multi-brand Platform as a C3) New Pathway to Grow the Business e Ladder to the Greater Purpose: “Celebrating the can-do spirit by enabling anyone who takes on life with their own two hands.” e Focus on features, benefits, durability, innovation and a strong value proposition e Prioritize
Slide 20: Test & Learn to Unlock Long-term Growth Potential
Test & Learn to Unlock Long-term C4] Growth Potential e Gain operational learnings to implement wholesale opportunities including logistics, systems and people needed to scale efficiently e@ = Gain direct-from-manufacturer operational learnings to offer unique and customized products based on custom
Slide 21: Increase and Accelerate Investments to Future Proof the Business
Increase and, in Some Areas, Accelerate Investments to Future Proof the Business e Analyze and identify investments that will allow us to scale more easily and effectively, as well as deliver on ever-evolving customer expectations: Increased investments in automation across our logistics network to
Slide 22: Thank You
THANK YOU
Slide 23: Appendix: Reconciliation to Adjusted EBITDA and Free Cash Flow
Appendix Reconciliation to 2022 Adjusted EBITDA and Free Cash Flow Adjusted EBITDA ee Cash Flow {Sin millions) Net Income (+) Depreciation and amortization (+) Amortization of internal-use software hosting subscription implementation costs (+) Interestexpense (+) Incometax expense EBITDA (+) Stock b