Carparts.com, Inc. · NASDAQ:PRTS
Carparts.com — U.S. Auto Parts Network — Investor Presentation (October 2018)
24 slides from Carparts.com's investor presentation, Oct 30, 2018
Slide 1: Safe Harbor
Safe Harbor 1 This presentation contains “forward-looking” statements, within the meaning of the federal securities laws, that are based on our management’s beliefs and assumptions and on information currently available to management. Forward-looking statements include information concerning our pos
Slide 2: Company Overview
Company Overview US Auto Parts is a leading pure-play internet retailer of aftermarket auto parts We operate online sites, marketplace storefronts and wholesale channels focused on the do-it-yourself (DIY) customer Offer over 1.5 million SKUs of high quality private label and branded aftermarket pro
Slide 3: Online Aftermarket Auto Parts Sales Benefits From Macro Trends
Online Aftermarket Auto Parts Sales Benefits From Macro Trends 3 Source: US Auto Care Association Average age of light vehicles on the road remains high Online aftermarket sales to more than double by 2023 as market share continues to increase Source: IHS 17% CAGR (in years) 10.0 10.1 10.3 10.6 10.9
Slide 4: How We Go To Market: Channels & Percent of Revenue
How We Go To Market: Channels & Percent of Revenue 4 89% Offline/Wholesale: Products distributed directly to commercial customers and our Kool-Vue® branded products sold to wholesale distributors. 11% Based on estimates using Trailing Twelve Months (TTM) Q3-18 eCommerce Websites: Network of flagship
Slide 5: Key Avenues for Growth – Increase Customer Lifetime Value
Increased customer LTV would result in greater mix of traffic from both direct-to-website and paid channels, and less dependence on organic search Key Avenues for Growth – Increase Customer Lifetime Value Gross Profit per Transaction Average Order Size Repeat Purchase Conversion Reach Efficient sour
Slide 6: Price & Product Availability: Customer Value Proposition
Price & Product Availability: The Two Most Important Factors for DIY Customers Customer Value Proposition 6 Value Cost-conscious customers are able to purchase our private label products at a significant cost savings. Private label product pricings when compared against the same branded product aver
Slide 7: We Address the Market with an Expansive Product Offering
We Address the Market with an Expansive Product Offering Over 1.5 Million SKUs Across Several Categories 7 Brake Discs Catalytic Converters Radiators Headers Oxygen Sensors Alternators Exhaust Driveshaft Fuel Injection / Delivery Lamps Mirrors Bumpers Hoods Tailgates Doors Grills Wheels Window Regul
Slide 8: Efficient Supply Chain Creates a Pricing Advantage
Efficient Supply Chain Creates a Pricing Advantage 8 USAP has built a vertically integrated online business Importer Center Brand Warehouse Distributor Service Center Consumer Retail Store Consumer Off-Shore Manufacturing ~20% of Units Drop-Ship Jobber ~80% of Units Stock-Ship DIY DIFM = Product Flo
Slide 9: Efficient Supply Chain Creates a Pricing Advantage
Efficient Supply Chain Creates a Pricing AUTOPARTS' Advantage NASDAQ:PRTS USAP has built a vertically integrated online business — _ = Product Flow for Private Label ----- = Product Flow for Drop Ship Vendors ~80% of Units Stock-Ship ’ ~20% of Units / Drop-Ship 1 Off-Shore 8 Manufacturing it) Retail
Slide 10: Company Profile
Company Profile Revenues ~ $300M Q3-18 TTM Net loss of ($3.4M) which included a non cash tax impact of ~($4M) for the Tax Cuts & Jobs Act Q3-18 TTM Adjusted EBITDA of $12.3M1 High Margin private label business was 74% of sales for Q3-18 TTM Positive Free Cash Flow with no revolver debt Public Compan
Slide 11: Strong Net Income & Adjusted EBITDA Growth Trends
Strong Net Income & Adjusted EBITDA¹ Growth Trends for U.S. Auto Parts Non-GAAP financial measure Adjusted EBITDA consists of net income before interest expense, net; income tax provision; depreciation and amortization expense; amortization of intangible assets; restructuring costs; share-based comp
Slide 12: Financial Performance
Financial Performance 12 Non-GAAP financial measure Adjusted EBITDA consists of net income before interest expense, net; income tax provision; depreciation and amortization expense; amortization of intangible assets; restructuring costs; share-based compensation expense; and costs associated with ou
Slide 13: Two Year Stacked Private Label Quarterly Sales Trend
2 Year Stacked Private Label Quarterly Sales Trend1 13 Private Label continues to be a major focus of our business Two Year Stack Comps 1Comparables net sales was calculated by excluding $2.0M in private label sales related to the extra week in Q4-14, as well as $1.7M, $1.4M, $0.8M and $0.5M in sale
Slide 14: Key Takeaways
Key Takeaways A leading pure-play internet retailer of aftermarket auto parts $13 billion on-line market expected by 2018 and anticipated to nearly double by 20231 Extensive reach across our websites and marketplace partnerships Maintaining a higher mix of private label products to drive increased c
Slide 15: Key Takeaways
AUTOPARTS NASDAQ:PRTS Key Takeaways > A leading pure-play internet retailer of aftermarket auto parts > $13 billion on-line market expected by 2018 and anticipated to nearly double by 2023 > Extensive reach across our websites and marketplace partnerships > Maintaining a higher mix of private label
Slide 16: Company History
Launched first internet site selling automotive Collision Line Launches a network of sites catered to various consumer segments Company begins significantly expanding its private label engine line JC Whitney completely integrated 1995 2000 2010 2005 2006 2011 Acquires JC Whitney Adds Accessories Lin
Slide 17: Experienced Leadership Team
Experienced Leadership Team Aaron E. Coleman Chief Executive Officer Since April 2017 President since October 2016 and COO since September 2010 Vice President of Operations and CIO from April 2008 - September 2010 Over 18 years of e-commerce experience Senior Vice President – Online Systems at Block
Slide 18: Financial Highlights – Q3-18
Financial Highlights – Q3-18 Total revenue $69.5M Net income from continuing operations was $0.4M vs. the prior year $0.9M Adjusted EBITDA1 $2.5M vs. prior year of $3.6M $8.3M in cash with zero revolver debt vs. last year of $6.7M in cash with zero revolver debt Added approximately 1,700 Private Lab
Slide 19: Focusing on the consumer experience to increase conversion
By focusing on the consumer experience, we will increase conversion which we believe will allow us to drive more traffic Product Discovery The Customer Journey Experience Landing Experience “To captivate and engage customers with our website in order to win their attention.” Post-Purchase Experience
Slide 20: Overview of Customs Issues
Overview of Custom Issues On April 2, 2018, U.S. Auto Parts filed a lawsuit against the United States Department of Homeland Security (“DHS”) which has oversight over the Customs and Border Protection (“Customs”) in the United States Court of International Trade (the “Court”) (Case No. 1:18-cv-00068
Slide 21: Yearly Adjusted EBITDA Reconciliation
Yearly Adjusted EBITDA Reconciliation Non-GAAP financial measure Adjusted EBITDA consists of net income before interest expense, net; income tax provision; depreciation and amortization expense; amortization of intangible assets; restructuring costs; share-based compensation expense; costs associate
Slide 22: Quarterly Adjusted EBITDA Reconciliation
Quarterly Adjusted EBITDA Reconciliation 22 Non-GAAP financial measure Adjusted EBITDA consists of net income before interest expense, net; income tax provision; depreciation and amortization expense; amortization of intangible assets; restructuring costs; share-based compensation expense; costs ass
Slide 23: Key Stats: PRTS (NASDAQ) – Consolidated
Key Stats: PRTS (NASDAQ) – Consolidated Data sources: Yahoo! Finance, S&P Capital IQ, company filings. Includes 2.8M preferred shares As of September 30, 2018 Trading Data (@ October 24, 2018) Stock Price $1.43 52 Wk. High/Low $2.74/1.08 Avg. Daily Vol. (3 mo.) 160,952 Shares Outstanding1 35.0M Inst
Slide 24: Key Stats: PRTS (NASDAQ) – Consolidated
Key Stats: PRTS (NASDAQ) — Consolidated AUTOPARTS NASDAQ:PRTS Trading Data (@ october 24, 2018) Financial Highlights (@ sept 29, 2018) Stock Price $1.43 Revenues (77M) 52 Wk. High/Low $2.74/1.08 Gross Margin (T™m) Avg. Daily Vol. (3 mo.) 160,952 Cash & Equiv. Shares Outstanding? 35.0M Total Assets I
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