Srx Health Solutions, Inc. · AMEX:SRXH
Srx Health Solutions — Better Choice — FY2020 Earnings Presentation
24 slides from Srx Health Solutions's earnings presentation, Mar 31, 2021
Slide 1: Q4 and 2020 Full Year Financial Results
Better Choice Company, Inc. Q4 and 2020 Full Year Financial Results March 31, 2021
Slide 2: Safe Harbor
Safe Harbor This presentation contains information, statements, beliefs and opinions which are forward-looking, and which reflect current estimates, expectations and projections about future events, referred to herein and which constitute “forward-looking statements” or “forward-looking information”
Slide 3: BTTR Has A Clear Strategy For Rapid Growth
BTTR Has A Clear Strategy For Rapid Growth BECOME A CLEAR LEADER IN PREMIUM+ PET FOOD FOR CATS AND DOGS. LEAD GLOBAL INNOVATION IN THE PREMIUM+ PET FOOD CATEGORY. UTILIZE AN OMNI-CHANNEL APPROACH LEVERAGING ECOMMERCE. 3Note: Premium+ defined as the premium through ultra-premium segments
Slide 4: With A Dynamic Company Culture
With A Dynamic Company Culture • Our Mission: Become the most innovative premium pet food company in the world. • Our Vison: The pet food company that excites creativity, optimism, and well-being. • Company Values: o Make products with integrity o Treat pets and their parents with respect o Create l
Slide 5: We Have Assembled A World Class Team
We Have Assembled A World Class Team Ready to take the lead position in the pet food industry 5
Slide 6: A Leadership Team Positioned To Win
A Leadership Team Positioned To Win Scott Lerner CEO Alex Vournas VP Supply Chain Donald Young EVP Retail Sales Sharla Cook CFO Rob Sauermann EVP Strategy Ryan Wilson VP Marketing Jenny Condon EVP Digital Sales 6 • Scott Lerner – Consumer products veteran with 20+ years of experience; track record o
Slide 7: BTTR Has 35+ Years of Success
BTTR Has 35+ Years of Success • The Halo and TruDog brands have a long history of success in the market and have positioned the company for growth • Both brands were born out of the idea to deliver BETTER nutrition and wellness CHOICES to help furry family members live healthier, happier and longer
Slide 8: Two Complementary Brands With Innovative Opportunities for Consolidation Over Time
Two Complementary Brands With Innovative Opportunities for Consolidation Over Time • A 35-year-old, super premium natural pet food brand uniquely differentiated from its competitors • Using natural whole meat and no rendered meat meal • Highly digestible due to the use of real whole protein ▪ Histor
Slide 9: Best-in-Class Products Delivering On Core Consumer Needs
Best-in-Class Products Delivering On Core Consumer Needs 9
Slide 10: Simplifying Our Business To Drive Success
10 Simplifying Our Business To Drive Success • Growing 2 differentiated business models is overly complex, costly, and time consuming
Slide 11: One Halo Brand!
One Halo Brand! Driven by creativity and innovation 11
Slide 12: Creates A Smarter Approach
Creates A Smarter Approach 12 One mega Halo brand that spans across all channels domestically and internationally. 01 Allows for a strong “Halo” marketing effect across all sub-brands to maximize spending. 02 While talking to the consumer at an efficient higher master brand and emotional level. 03 E
Slide 13: And Leverages A Differentiated Omni-Channel Strategy
And Leverages A Differentiated Omni-Channel Strategy Ecommerce Brick & Mortar DTC• Multiple channels allows BTTR to optimize margin by maneuvering revenue from one channel to the next on a monthly basis as needed • By eliminating channel conflict it opens up our ability to share resources from one c
Slide 14: International Expansion Is A Key Strategy
International Expansion Is A Key Strategy • We believe growth in Asia is fueled by increasing levels of economic financial status and demand for premium, western manufactured products, with China representing the largest market opportunity for growth • Halo realized an impressive 95% YoY sales growt
Slide 15: BTTR Has A First-Mover Advantage In China
BTTR Has A First-Mover Advantage In China 15 Chinese Market Opportunity: • Chinese pet market estimated to be ~$7 billion by 2022 • Only ~10% of urban households in China own a pet (Mordor Intelligence) • Premium dry cat food market growing at 28% CAGR (2015 – 2025F; Euromonitor) • Premium dry dog f
Slide 16: BTTR Is Focused on Maximizing Shareholder Value
BTTR Is Focused on Maximizing Shareholder Value • E-Commerce, DTC & Pet Specialty work together to create a “Halo” effect • Recent team member additions expected to drive Pet Specialty growth Anchored in high growth channels • Consistent near-doubling of international sales YoY with contracted minim
Slide 17: While Simultaneously Sourcing & Evaluating Transformative M&A Transactions
• We remain committed to locating the right assets that meet our investment criteria • Strong industry contacts increase our ability to source transactions internally and avoid highly competitive auctions • Preference for asset light models that avoid channel confliction / competition with Halo & Tr
Slide 18: 4Q and 2020 Full Year Financial Highlights
4Q and 2020 Full Year Financial Highlights Strong Base for Growth in Core Channels 2020 Results: Gross Sales: $51m 2020 Net Sales: $43m Adj. Gross Profit: $17m 2020 Net Sales by Channel: E-Commerce: 34% DTC: 25% Brick & Mortar: 21% International: 20% Near Break-Even Pro Forma Adjusted EBITDA 2020 Ad
Slide 19: Adjusted EBITDA Reconciliation 4Q and FY 2020
1919 Adjusted EBITDA Reconciliation 4Q and FY 2020 ($ 000’s) Year Ended Three Months Ended Three Months Ended Three Months Ended Three Months Ended December 31, December 31, September 30, June 30, March 31, 2020 2020 2020 2020 2020 Net and comprehensive loss (59,438)$ (29,784)$ (1,728)$ (18,438)$ (9
Slide 20: Three Months Ended December 31, 2020 Adjusted Income Statement
2020 Three Months Ended December 31, 2020 Non-Cash Non-Recurring Adjusted Net sales 9,288$ 9,288$ Cost of goods sold 5,924 (217) A 5,707 Gross profit 3,364 217 - 3,581 Operating expenses: General and administrative 2,668 (751) B 605 D 2,522 Share-based compensation 1,893 (1,893) C - Sales and market
Slide 21: FY Income Statement to Adjusted EBITDA Reconciliation
2121 FY Income Statement ➔ Adjusted EBITDA Reconciliation Adjusting for Non-Cash and Non-Recurring Charges, FY20 Pro Forma Adjusted EBITDA was ($1,574) Year Ended December 31, 2020 Non-Cash Non-Recurring Adjusted Net sales 42,590$ 42,590$ Cost of goods sold 26,491 (1,111) A 25,380 Gross profit 16,09
Slide 22: Refinancing and Balance Sheet Update
• January 2021: $12.0m Credit Facility closed with Wintrust Financial ($6.0m TL; $6.0m Revolver) • Completed refinancing of the Bridge Loan, extending existing maturities and reducing annual cash interest expense by ~$2m • Reduction in leverage of ~$2m relative to December 31, 2020 balance sheet • J
Slide 23: The New Halo Brand Strategy Simply Works!
The New Halo Brand Strategy Simply Works! 1. Easy to execute in market 2. Creates a “Halo” effect 3. Leverages internal scale 4. Allows for selective M&A opportunities over time 23
Slide 24: Thank You
Thank You 24