Deckers Outdoor Corporation · NYSE:DECK
Deckers Outdoor — Investor Presentation (October 2015)
31 slides from Deckers Outdoor's investor presentation, October 2015
Slide 1: Investor Presentation October 2015
INVESTOR PRESENTATION October 2015
Slide 2: Safe Harbor Language
SAFE HARBOR LANGUAGE We make forward-looking statements in this presentation which represent our expectations or beliefs about future events and financial performance. Forward-looking statements are identifiable by words such as “believe,” “anticipate,” “expect,” “intend,” “plan,” “will,” “may” and
Slide 3: Growth Strategy
GROWTH STRATEGY 1) Build on UGG success to broaden commercial appeal of the brand and increase penetration of new categories 2) Deliver world class service and enhanced consumer engagements through advanced Omni-Channel capabilities 3) Capitalize on untapped international opportunities 4) Leverage a
Slide 4: UGG
UGG 4
Slide 5: Building on UGG Success
BUILDING ON UGG SUCCESS Evolve Classic Grow Casuals and Franchise Weather Expand Non-Footwear Grow Men and Kids’ Categories 5
Slide 6: Evolve Classic Franchise
EVOLVE CLASSIC FRANCHISE • Introduced Classic Luxe, a premium sophisticated collection made in Italy • Introducing Classic Slim, a tailored version of the Classic for Holiday 2015 • Both collections offer a slimmer and more modern silhouette • Core, Slim, and Premium silhouettes will grow the Classi
Slide 7: Grow Casual and Weather
GROW CASUAL AND WEATHER • Casual and Weather styles for Fall 2015 include many popular carryover styles and some new introductions • Diverse weather boot offering that covers a variety weather events • Casual boots incorporate UGG DNA and have limited fashion risk 7
Slide 8: Grow Men and Kids'
GROW MEN AND KIDS’ • Men’s currently represents approximately 10% of UGG revenue • Long-term believe men’s business has ability to reach 20% of UGG revenue • Innovate and create new entry points for the male consumer through twinsole and Treadlite by UGG™ • Lever Kids’ strong foundation in Classics
Slide 9: Expand Non-Footwear Categories
EXPAND NON-FOOTWEAR CATEGORIES • Non-Footwear: handbags, loungewear, home and accessories currently represent approximately 5% of UGG revenue • Long-term opportunities to grow non-footwear with low risk, low capital expense • Success with loungewear: The Duffield is the best selling robe in Nordstro
Slide 10: Omni-Channel
NI-CHANNEL DECKERS — BRANDS —
Slide 11: Advanced Omni-Channel Platform
ADVANCED OMNI-CHANNEL PLATFORM • 145 company operated UGG stores worldwide • 21 local language websites • Stores and ecommerce sites becoming intertwined through numerous Omni-Channel initiatives; • Infinite UGG • Retail Inventory Online • Buy Online / Return In-store • Click and collect • In early
Slide 12: Omni-Channel Highlights
OMNI-CHANNEL HIGHLIGHTS • Opened 30 UGG stores in fiscal year 2015 • New stores performing above pro-forma store model targets • Capital efficient retail model including: own stores, partners, and pop- ups • Strong direct-to-consumer operating margins above 20% 12
Slide 13: Compelling Target Store Economic Model
COMPELLING TARGET STORE ECONOMIC MODEL • 2,500 square foot store • $1,000 sales per square foot • $750,000 in build out costs • 20% 4-wall margins • 1 year cash payback 13
Slide 14: Store Count as of 9/30/2015
STORE COUNT AS OF 9/30/2015 Location Concept Outlet Total US 26 28 54 China 28 9 37 Japan 18 8 26 EMEA 10 7 17 Canada 6 2 8 Hong Kong 3 0 3 Total 91 54 145* *Total excludes partner stores and pop-ups 14
Slide 15: Omni-Channel Evolution
OMNI-CHANNEL EVOLUTION • Selectively opening a mix of concept and outlet locations • Launching new local-language international sites • Redirecting marketing budget towards more digital programs • Piloting loyalty program • Leveraging enhanced CRM capabilities to deliver geo-targeted content and fur
Slide 16: International
INTERNATIONAL 16
Slide 17: EMEA Progress and Initiatives
EMEA PROGRESS AND INITIATIVES • Acquired distribution rights for the UGG brand in Germany on July 1, 2014 • Upgraded leadership in the region • Driving retail profitability through optimized operating model and enhanced consumer experience • Broadening merchandise assortment with focus on increasing
Slide 18: APAC Progress and Initiatives
APAC PROGRESS AND INITIATIVES • Fastest growing region led by Japan • Organizational investments in place and yielding positive returns • Significant untapped opportunities across brands and channels • Expanding door count in China through a partner model • Partner model allows for low risk, low cap
Slide 19: Growth Opportunity in Other Brands
GROWTH OPPORTUNITY IN OTHER BRANDS Outdoor / Lifestyle Active Lifestyle / Running Brand Brand Casuals Brand Key Competitors: Key Competitors: Key Competitors: 19
Slide 20: HOKA ONE ONE
HOKA ONE ONE 20
Slide 21: Growth Strategy: HOKA ONE ONE
GROWTH STRATEGY: HOKA ONE ONE • Authentic creator of the oversized running shoe category • Expanding product offering into new categories such as hiking • Increasing awareness through numerous awards including Runner’s World Editor’s Choice and through sponsorship of 2012 1500m Olympic Silver Medali
Slide 22: Teva
TEVA 22
Slide 23: Growth Strategy: Teva
GROWTH STRATEGY: TEVA • Strengthening core product strategy through the Originals sandal collection and Original derivatives • Capturing momentum from new/modern outdoor • Originals highlighted as a key fashion item in numerous media outlets including Good Morning America and Vogue; featured runway
Slide 24: Sanuk
SANUK 24
Slide 25: Growth Strategy: Sanuk
GROWTH STRATEGY: SANUK • Leverage strength and authenticity in Action Sports Surf to expand in new frontiers and speak to new audiences • The Sandal and Casual categories are established and building each season • Strategic focus on women’s with growth being led by Yoga mat Collection • Robust distr
Slide 26: Financial
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Slide 27: Financials
FINANCIALS Sales Growth $ billons $2.01B CC* $1.96B + 10.5% 2 $1.82B + 8.0% 1.8 CAGR $1.59B + 14.5% 1.6 11.1% $1.43B + 10.9% 1.4 1.2 FYE13 FYE14 FYE15 FYE16* EPS Growth $5.73 CC* 6 $5.18 + 23.0% 5.5 CAGR 5 *FYE16 estimate $4.66 + 11.2% 14.5% based on guidance 4.5 issued Oct. 29, 2015 $4.07 + 14.5% 4
Slide 28: Fiscal Year 2016 Guidance
FISCAL YEAR 2016 GUIDANCE* • Revenues to increase approximately 10.5% in constant currency over twelve month period ended March 31, 2015. On a reported basis, revenues are expected to increase 8% • Gross profit margin of approximately 48% • SG&A as percentage of sales projected to be approximately 3
Slide 29: Long-Term Operating Margin Drivers
LONG-TERM OPERATING MARGIN DRIVERS Gross Margins Expansion • Making strategic adjustments to our business model to create efficiencies in supply chain • Reducing SKU count and focusing on performance metrics to reduce development costs and improve our go-to-market process • Continued growth in our D
Slide 30: Key Investment Highlights
KEY INVESTMENT HIGHLIGHTS • Driving strong revenue and earnings growth • Significant international potential and growth opportunities across the brand portfolio • Focusing on improving operating efficiencies and generating leverage • Business model generates strong margins and significant free cash
Slide 31: Thank You
THANK YOU
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