Tile Shop Holdings, Inc. · OTC:TTSH
Tile Shop — Investor Presentation (January 2016)
30 slides from Tile Shop's investor presentation, Jan 12, 2016
Slide 1: The Tile Shop Investor Presentation
The Tile Shop Investor Presentation January 12, 2016
Slide 2: Forward Looking Statements and Non-GAAP Information
Forward Looking Statements and Non-GAAP Information ‘These sles and accompanying ol presentation conta “orwarlokng statements” within the meaning of the “safe hafbor prov'sions of he Unted States Private Securties Ligation Reform Act o 1995. Forvareioolng statements may be Kentifea bythe use of word
Slide 3: Founded in 1985
Founded in 1985 V Dedicated retailer to the home tile market with a strong growth story A Operate 114 stores in 31 states with a long-term goal of 300-400 stores « * Four distribution centers that are well-positioned to support near term growth Key Differentiation Points drive nearly 70% Gross Margi
Slide 4: Historical Financial Performance
Historical Financial Performance Net Sales Approx, Growth vs. Macro/Industry Indicators“ $293 $257 mTISsomeStoreSsiesGouth mEdstng HomeSaes u Foor Covering Stores $229 $183 gus sts 153 2009 2010 2011-2012 2013:« 2014-2015 Outlook 2011 2012 2013 2014 —— Adjusted EBITDA $97 Adjusted EBITDA Margin; +10
Slide 5: Year to Date Results
Sales $22.4 $193.9 Comparable Store Sales Growth 6.6% (0.5%) Gross Margin 69.2% 69.6% Non-GAAP EPS 1 $0.25 $0.20 Adjusted EBITDA $4.2 $37.2 Adjusted EBITDA Margin 20.0% 19.2% Additional Q3 YTD 2015 Highlights: + Professional customer segment sales growth strongly outpacing balance of chain + Signifi
Slide 6: 2015 Full Year Outlook
2015 Full Year lo Sales Approx. $293 $257.2 + Approx. 14% Comparable Store Sales Growth + Mid-single digits (0.4%) Non-GAAP Earnings per Share () $0.31 to $0.33 $0.23 +3596 - 439% Tile Shop
Slide 7: Establishment of Successful Model / Investment Phase
ed i on Establishment of / Investment Successful Model Phase . = AVUUUVae iusTile Shop
Slide 8: Establishment of Successful Model 1985-2011
1985 2011 sa sg Establishment of Successful Model
Slide 9: Differentiation Points Enable Best in Class Margins
Differentiation Points Enable Best in Class M Vertically Integrated Value Chain Striking Visual Product Presentation , EL ile Shop
Slide 10: Striking Visual Product Presentation
g Visual Product Presentati Display “vignettes” are the catalyst for a strong mix of finishing and accessory products such as bullnose, thresholds, corner shelves, et
Slide 11: 2014 Total Company Adjusted EBITDA Margin
2014 Total Company Adjusted EBITDA Margin 18.5% 15% 15% 18% 13% } ; | [ I Mattress Firm Pier 1imports Lowe's Select Comfort. Lumber williams TheHome Bed Bath& —TheTTile Shop Liquidators Sonoma Depot Beyond TERT aan Gia pee Sam eS a Tence reba te gp nea tear acm eae NET SOD
Slide 12: Investment Phase 2012-2014
Slide 13: Distribution, Corporate and IT Infrastructure Investments
2012-2014 Distribution and Manufacturing Facilities Corporate and iT Infrastructure Investments fensity, SG&A % and EBITDA margin
Slide 14: Doubling of Store Base
Doubling of Store Base Growth rate of store openings ’ Store Count tripled over the period (end of year) \ 16h I emma . 48 TT ss lal lw . 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Rent, Taxes, CAM, Other Occupancy and certain Wages fully incurred at store opening wt Tile Shop
Slide 15: New Distribution & Manufacturing Facilities
New Distribution & Manufacturing Facilities Built Manufacturing capability at Ridgeway, VA in 2012-2013 Opened Durant, OK Distribution and Manufacturing facility in 2013 to support Southwest growth No significant additional investments needed in the near term Distribution Center and Manufacturing Ca
Slide 16: 2015 and Beyond
2015 and Beyond
Slide 17: 2015 Strategic Initiatives, 2016 in Focus
2015 Strategic Initiatives 2016 in Focus Expand Focus on Professional Customer Increase Marketing Effectiveness Store Size
Slide 18: Retail Talent Identification and Training
Retail Talent Identification and Training 2015 In Focus 1. Improved hiring and selection process for Store Managers ba Multiple strong candidates competing * Robust interview process including CEO. be Goal is to have a manager at a new store opening at least 30 days in advance of opening Accelerate
Slide 19: Pro Mix Has Increased Dramatically in 2015
Pro Mix has increased dramatically in 2015, 2015 in Focus accelerating each quarter Pro Mix % of Total Revenue - Increase vs. 2014 +300bps +200bps +100bps Qi a2 a3 iaiuel ile Shop
Slide 20: Growing the Mix of Pro Enables Higher Store Sales Volume
Growing the Mix of Pro is a Proven Enabler to A Higher Total Store Sales Volume 2015 in Focus Average Pro Mix by Total Annual Revenue 0% of Pro Mix % = G Growth Pro Mix% of Total Store Sales <$2M S5M+ Annual Total Store Revenue iaiuel ile Shop
Slide 21: Goals of 2015 Strategic Initiatives
Goals of 2015 Strategic Initiatives 2015 in Focus * Consistently achieve positive comparable store sales growth Y * Improve 2013-2015 new store sales productivity v * Increase Pro Segment mix of sales vy * Decrease retail turnover YW * Increase Adj. EBITDA Margin iaiuel ile Shop
Slide 22: 2016 Strategic Initiatives
2016 Strategic Initiatives * Retail Talent Development * Continue to Grow our Pro Business * Strong Execution of Unit Growth Increase annual growth to 8 to 12% * Openings focused in current markets Targeted store size of mid-teens or less (square feet, thousands) le Shop
Slide 23: Store Growth
Store Growtl Store Count (end of year) = ee en syecacnin store cout verte ptiod “2005 2006 2007 2008 2009 2010 2011 2012-2013 2014 2015 2016 20176 2018 Plan is for 8-12% Store Growth over the next several Cousens) Average Square Footage per Store years 23.2k oe Majority of openings will be in existi
Slide 24: Revenue and Adjusted EBITDA Margin Targets
mn Matons) Revenue Approx. $400 Approx. $293 $257 229 2012 2013 2014 2016E 2017E 2018E Adjusted EBITDA Margin +100 + Approx. 0 100bps 100bps 100bps 24% 7 I 7 ‘ J a = | 2012 2013 2014 2015 2016E 2017E + Approx, + Approx.
Slide 25: Appendix
Appendix iaiuel ile Shop
Slide 26: Q3 2015 YTD Non-GAAP EPS and EBITDA Reconciliations
Q3 2015 YTD Non-GAAP EPS and EBITDA Reconciliations Agena Sintowasa) iaiuel ile Shop
Slide 27: Non-GAAP Net Income and Adjusted EBITDA Guidance Reconciliation
Non-GAAP Net Inco (inaalions) Income before income taxes Loss on extinguishment of debt approx. $0.2 Special charges approx. $1.2 ‘Non-GAAP net income before taxes $26 - $28 Provision for income taxes si0-sit Non-GAAP net income S16 -$17 Fully diuted shares outstanding approx. $1 millon ‘Non-GAAP Di
Slide 28: Historical Non-GAAP EPS and EBITDA
AAP EPS and EBIT Historical Nor Noo GAAP Net come (Sinomand, cogtslareandper stared) eps icone (ous) bfe nae oes 510370 Adjusted BTDA (Sinton) Neincene os) Treometes Depecaten snd mociaton Steckbased conperstion Adjusted EBTDA Tile Shop
Slide 29: Store Locations by State as of Dec. 31, 2015
114 Store Locations by State as of Dec. 31, 2015 iaiuelile Shop
Slide 30: Store Map
Store Map
Tile Shop Holdings — Investor Presentation (January 2016) on 6ix