Kontoor Brands, Inc. · NYSE:KTB
Kontoor Brands — Merger or Acquisition (February 2025)
20 slides from Kontoor Brands's merger presentation, February 2025
Slide 1: Kontoor Brands Acquires Iconic Outdoor and Workwear Brand Helly Hansen
KONTOOR BRANDS ACQUIRES ICONIC OUTDOOR AND WORKWEAR BRAND HELLY HANSEN Notes:
Slide 2: Safe Harbor
Safe Harbor Forward-Looking Statements Certain statements included in this presentation and attachments are "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements are made based on our expectations and beliefs concerning future events impacting the
Slide 3: We Remain Committed to Enhancing Our TSR Model
We Remain Committed to Enhancing Our TSR Model ACCELERATING INCREASING CASH FUNDAMENTAL + FLOW OPTIONALITY GROWTH = ENHANCED TSR COMMITMENT 3
Slide 4: KTB Continues to Deliver Against Our Strategic Vision
KTB Continues to Deliver Against Our Strategic Vision DRIVE LONG-TERM ACCELERATION TSR Drivers Cash Flow Optionality, Revenue and Margin Growth Dividend, De-leverage of Balance Sheet and Margin Strong organic performance Driven and now in an advantaged position to accelerate our model through accret
Slide 5: Helly Hansen Checked All the Boxes in Our Acquisition Framework
Helly Hansen Checked All the Boxes in Our Acquisition Framework ACQUISITION CRITERIA Authentic Brand in Structurally Attractive Addressable Markets Immediately Accretive to Our Financial Profile Retain Balance Sheet Flexibility; Strong Cash Generation & Returns on Capital Complementary to Our
Slide 6: Acquisition Provides Compelling Value Creation Opportunity
Acquisition Provides Compelling Value Creation Opportunity • Accelerates Kontoor’s revenue, earnings growth and • Benefits from Kontoor’s scale and operational capabilities cash flow profile • Leverages Kontoor’s expertise in the U.S. market to more • Diversifies portfolio in large, growing markets
Slide 7: Acquisition Strengthens Presence in Attractive Markets with Tailwinds
Acquisition Strengthens Presence in Attractive Markets with Tailwinds Kontoor Brands’ Helly Hansen Unlocks Significant Market Opportunity Existing Category Focus in Structurally Attractive Categories • Massive TAM opportunity and category tailwinds Outdoor / Global +HSD% • Functional category insula
Slide 8: Helly Hansen Fits Kontoor Brands' Investment Thesis
Helly Hansen Fits Kontoor Brands’ Investment Thesis Enhance / Accelerate the Core Diversification in Higher-Growth Categories • U.S. Opportunity with Complementary, Diversified • Diversification into Large and Growing $300B Outdoor and $30B Distribution Footprint Workwear Categories • Elevates a
Slide 9: Two Distinct Business Segments HH Sport | HH Workwear
Experts in Innovative, Delivering Workwear for Outdoor Professional- the World’s Harshest Grade Gear Environments Two Distinct Business Segments HH Sport | HH Workwear Notes:
Slide 10: Helly Hansen Has Separated Itself From the Pack
Helly Hansen Has Separated Itself From the Pack Revenue USD $1B 2024 2018 2013 10 Sources: Company Reports, Kontoor Brands Estimates
Slide 11: Helly Hansen is a Global Brand With Deep Heritage and Compelling Financial Profile
Helly Hansen is a Global Brand With Deep Heritage and Compelling Financial Profile ~3x ~$650MM ~$75MM Growth Over the Last 10 Years 2024 Revenue 2024 EBITDA Strong management team ~75% ~75% with long track record of Outdoor and Active Mix International Sales Mix success 11
Slide 12: Helly Hansen Growth Fueled by Large Opportunity in the U.S.
Helly Hansen Growth Fueled by Large Opportunity in the U.S. Global Revenue Growth Significant Growth Opportunity in the U.S. to 2019-2024 Capture Share in Growing Categories Revenue $651M +10% CAGR (1) U.S. ’19-’24 CAGR ~20% ‘24: $150M 2019 2024 HH Competitor A Competitor B Competitor C Competitor D
Slide 13: Helly Hansen Is Just Getting Started in China
Helly Hansen Is Just Getting Started in China Significant growth opportunity in China Helly Hansen entered the China market in 2021 through a joint venture ‒ Accelerating store and digital growth ‒ Strong profit improvement China is one of the fastest growing Outdoor markets in the world ‒ 19% marke
Slide 14: Transaction Summary
KONTOOR] HH TRANSACTION SUMMARY
Slide 15: Transaction Summary
Transaction Summary PURCHASE PRICE • $1,276 million CAD (equivalent to ~$900 million USD) enterprise value VALUATION MULTIPLE • 11x full year 2025E adjusted EBITDA, excluding synergies • Expected closing in Q2 2025 subject to satisfaction of customary closing conditions and ESTIMATED CLOSING regulat
Slide 16: Acquisition Significantly Enhances and Diversifies Our Portfolio
Acquisition Significantly Enhances and Diversifies Our Portfolio Revenue (2024) Diversification Across Channel, Category And Geography $3,259MM PRO FORMA KONTOOR KONTOOR $3,259 12% 15% CHANNEL Wholesale $2,608 88% 85% DTC 4% + 8% Denim CATEGORY 22% 32% 60% Outdoor 75% Workwear $651 6% 7% GEOGRAPHY 9
Slide 17: Significant Synergy Potential and Cash Flow Optionality
Significant Synergy Potential and Cash Flow Optionality We Anticipate Synergies Across the Business Supply Chain Efficiencies ‒ Sourcing and Logistics Optimization ‒ Distribution Efficiencies Significant Working Capital Operational Efficiencies + Opportunity Drives ‒ Real Estate Optimization Increme
Slide 18: Transaction Enhances our Total Shareholder Return Commitment
Transaction Enhances our Total Shareholder Return Commitment 15% >15% Revenue Growth Margin Expansion Dividend Yield Organic Total Share Repurchase Multiple Expansion M&A Total Shareholder Shareholder Return Return
Slide 19: Summary Value Drivers
Summary Value Drivers Expands opportunity in structurally attractive Diversifies portfolio across channels, markets with strong growth characteristics geographies, categories and consumers and secular tailwinds Materially increases revenue and earnings Immediately accretive to shareholder returns gr
Slide 20: Notes:
_ KONTOoR] HH BE | F
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