Slide 1: Tapestry
tapestry
Slide 2: Forward-looking statements
2 This presentation contains certain “forward-looking statements” based on management’s current expectations. Forward-looking statements include, but are not limited to statements which can be identified by the use of forward-looking terminology such as "may," "will," “can,” "should," "expect," "int
Slide 3: No Offer or Solicitation; Additional Information
3 No Offer or Solicitation This communication is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offe
Slide 4: Acquisition builds on TPR's core tenets as brand-builders and disciplined operators
Acquisition builds on TPR’s core tenets as consumer-centric brand-builders and disciplined operators, accelerating its strategic & financial growth agenda 01 EXPANDS PORTFOLIO 02 LEVERAGES CONSUMER ENGAGEMENT PLATFORM 03 UNLOCKS SYNERGY OPPORTUNITY 04 GENERATES STRONG CASH FLOW 05 EMPOWERS CULTURE 0
Slide 5: Tapestry announces definitive agreement to acquire Capri Holdings
TAPESTRY ANNOUNCES DEFINITIVE AGREEMENT TO ACQUIRE CAPRI holdings, ESTABLISHING A powerful global house of iconic luxury & fashion brands 5
Slide 6: Expands Portfolio
01 EXPANDS PORTFOLIO
Slide 7: Courage to be Real combines iconic luxury & fashion brands
7 Courage to be Real combines iconic luxury & fashion brands across consumer segments globally Glamour and Daring Spirit Joy Colors Life Celebrate Women Who Stand Strong Iconic Italian Heritage and Bold Confidence The Jet Set Lifestyle
Slide 8: Builds presence in attractive, growing & resilient categories
$12B Pro Forma Tapestry(2) Handbags, SLGs & FTW (1) Handbags, SLGs, FTW & Apparel(1) Personal Premium Goods(1) $200B+ $320B+ Notes: Global market; Source Euromonitor CY23. Global personal premium goods includes handbags/SLGs, footwear, apparel including outerwear, jewelry, watches, super premium bea
Slide 9: Enhances global reach & geographic diversification
Enhances global reach & geographic diversification and increases penetration in lifestyle categories EXTENDS GLOBAL REACH BROADENS PRODUCT OFFERING & TAPESTRY CAPRI PRO FORMA TAPESTRY 9 Note: Tapestry revenue figures represent FY2023 and Capri revenue figures represent LTM as of 7/1/23.
Slide 10: Pro forma Tapestry: revenue of $12.1B, adjusted operating profit of $1.9B
REVENUE OF $12.1B ADJUSTED OPERATING PROFIT OF $1.9B PRO FORMA TAPESTRY TAPESTRY CAPRI 10 TAPESTRY CAPRI Establishes a powerful portfolio of brands Note: Figures represent FY2023 Tapestry financials and LTM 7/1/2023 Capri financials. PRO FORMA TAPESTRY
Slide 11: Leverages Consumer Engagement Platform
02 LEVERAGES CONSUMER ENGAGEMENT PLATFORM
Slide 12: Utilizes Tapestry's data-driven & agile platform to drive consumer engagement
MODERN TECHNOLOGY INFRASTRUCTURE AGILE, EFFICIENT SUPPLY CHAIN CONSUMER ENGAGEMENT PLATFORM 12 utilizes TAPESTRY’S dynamic, data-driven & agile platform to drive consumer engagement 12
Slide 13: Opportunity to increase DTC penetration over time
13 leverages TAPESTRY’S proven and profitable Direct-to-Consumer model with a goal of increasing Capri’s direct-to-consumer penetration OPPORTUNITY TO INCREASE DTC PENETRATION OVER TIME TAPESTRY 88% DTC 68% DTC 79% DTC CAPRI PRO FORMA TAPESTRY Note: Tapestry revenue figures represent FY2023 and Capr
Slide 14: Unlocks Synergy Opportunity
03 UNLOCKS SYNERGY OPPORTUNITY
Slide 15: $200M+ run-rate cost synergies within three fiscal years
15 $200M+ ACHIEVED WITHIN THREE FISCAL YEARS POST-CLOSE ACROSS: OPERATING COSTS SUPPLY CHAIN EFFICIENCIES OF RUN-RATE COST SAVINGS Expects to realize significant cost synergies
Slide 16: Generates Strong Cash Flow
04 GENERATES STRONG CASH FLOW
Slide 17: Significant and consistent cash flow; unlevered pre-tax FCF of $1.9B
17 SIGNIFICANT AND CONSISTENT CASH FLOW enables RE-INVESTMENT IN THE BUSINESS, RAPID DELEVERAGe, AND PAYMENT OF DIVIDENDS UNLEVERED PRE-TAX FREE CASH FLOW(1) OF $1.9B TAPESTRY CAPRI PRO FORMA TAPESTRY Notes: Figures represent FY2023 Tapestry financials and LTM 7/1/2023 Capri financials. Does not inc
Slide 18: Empowers Culture
05 EMPOWERS CULTURE
Slide 19: Brings together more than 33,000 employees
19 33,000 employees BRINGS TOGETHER MORE THAN Combines each company’s shared values of innovation, inclusivity and creativity Provides new opportunities for internal career mobility & growth ESG strategy POSITIONED TO ADVANCE COMPREHENSIVE & IMPACTFUL Focused on a shared mission to drive progress to
Slide 20: Creates Path to Enhanced TSR
06 CREATES PATH TO ENHANCED TSR
Slide 21: Significant financial returns and commitment to capital return
21 SIGNIFICANT FINANCIAL RETURNS Combination expected to deliver strong double-digit EPS accretion on an adjusted basis and compelling ROIC ACCRETIVE TO TOTAL SHAREHOLDER RETURN PLAN Acquisition is accretive to Tapestry’s existing standalone high-teens TSR plan, underscoring financial discipline and
Slide 22: Transaction Details
- Transaction Details tapestry
Slide 23: Applying Tapestry's Four Lens Framework to the Acquisition of Capri
Four Lens Framework Broadens our reach within attractive & resilient categories, while deepening access to luxury consumer segments in the market Strengthens our geographic diversification given highly complementary positions in Asia & Europe Expands our penetration of lifestyle categories STRATEGY
Slide 24: Key Transaction Terms
Key Transaction Terms 24 Tapestry to acquire all outstanding shares of Capri for a total consideration of $57.00 per share in cash $8.5B enterprise value(1)(2), consisting of $6.8B in equity value and $1.7B in net debt PURCHASE PRICE VALUATION MULTIPLE 9x EV / LTM Adj. EBITDA(2) 7x EV / LTM Adj. EBI
Slide 25: Capital Allocation Priorities
Capital Allocation Priorities Focused on Driving Organic Growth, Profitability, and Shareholder Value 01 REINVEST IN THE BUSINESS 02 RAPID DEBT PAYDOWN 03 RETURN CAPITAL TO SHAREHOLDERS Continuing to invest in brand-building activities and platform enhancements to fuel long-term growth Prioritize de
Slide 26: Quote from Joanne Crevoiserat, CEO, Tapestry
JOANNE CREVOISERAT, CHIEF EXECUTIVE OFFICER, TAPESTRY “The combination of Coach, Kate Spade, and Stuart Weitzman with Versace, Jimmy Choo, and Michael Kors creates a new powerful global luxury house, unlocking a unique opportunity to drive enhanced value for our consumers, employees, communities, an
Slide 27: Non-GAAP financial measures
27 Each of Tapestry, Inc. and Capri Holdings Limited report information in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). Tapestry’s management does not, nor does it suggest that investors should, consider non-GAAP financial measures in isolation from, or as a substitute for
Slide 28: Tapestry
tapestry