Boot Barn Holdings, Inc. · NYSE:BOOT
Boot Barn — Investor Presentation (August 2019)
29 slides from Boot Barn's investor presentation, Aug 6, 2019
Slide 1: August 2019
1 1 August 2019
Slide 2: Important Information: Forward-Looking Statements
2 IMPORTANT INFORMATION Forward - Looking Statements This presentation contains forward - looking statements that are subject to risks and uncertainties. All statements other than sta tements of historical fact included in this presentation are forward - looking statements. You can identify forward
Slide 3: Agenda: Boot Barn Story and Strategic Initiatives
3 APPENDIX STRATEGIC INITIATIVES CONTINUE OMNI - CHANNEL LEADERSHIP BUILD OUT EXCLUSIVE BRAND PORTFOLIO EXPAND OUR STORE BASE 1 2 3 4 BOOT BARN STORY AGENDA DRIVE SAME STORE SALES GROWTH
Slide 4: Boot Barn Is a Compelling Investment Story
4 4 BOOT BARN IS A COMPELLING INVESTMENT STORY • Healthy same store sales growth in stores and online • Importance of quality and fit • Lifestyle experience across stores, e - commerce and events • Significant e - commerce penetration STRONG OMNI - CHANNEL BRAND PRESENCE NATIONAL LEADER IN ATTRACTIV
Slide 5: A True American Lifestyle
5 1 Fox News 1/4/2019, “ The 10 best - selling vehicles in the United States in 2018 were mostly trucks and SUVs ” ; 2 Forbes.com, 10/31/16, “ Country Music ’ s Popularity and Influence Continues to Rise ” A TRUE AMERICAN LIFESTYLE Country music popularity continues to rise 2 Top 3 vehicles sold in
Slide 6: Large $20 Billion Industry Provides Growth Opportunity
6 6 LARGE $20 BILLION INDUSTRY 1 PROVIDES GROWTH OPPORTUNITY DRIVERS OF WORK WEAR GROWTH x Blue collar employment x Strength in oil & gas x Construction spending x Commercial accounts x Work safety regulations x Country music x Western events x Ranching x Horse ownership x Agriculture DRIVERS OF WES
Slide 7: Diversified Sales Mix Mitigates Risk
7 7 1 Fiscal year ended March 30, 2019. 2 As of March 30, 2019, western styles comprised approximately 70% of our sales, with work related and other styles making up t he balance. PRODUCT MIX 1 DIVERSIFIED SALES MIX MITIGATES RISK END USER 1 CHANNEL 1 Footwear 52% Hats, Accessories & Other 14% Appar
Slide 8: Everyday Merchandise with Limited Fashion Risk
8 8 EVERYDAY MERCHANDISE WITH LIMITED FASHION RISK RUGGED FOOTWEAR OUTERWEAR FLAME RESISTANT PANTS SHIRTS WORK & OTHER BOOTS DENIM WESTERN SHIRTS COWBOY HATS BELTS WESTERN • Low fashion quotient minimizes markdown exposure • Vast majority of our merchandise sales are at full price 1 ¹Excludes sheple
Slide 9: Boot Barn Has a History of Growth
9 9 BOOT BARN HAS A HISTORY OF GROWTH Note: Fiscal year ends March. FY13 includes 29 stores acquired from RCC with 7 month net sales of $35.5 million. FY14 includ es 30 stores acquired from Baskins with 10 month net sales of $63.4 million. Sheplers was acquired June 29, 2015, the beginning of Q2 FY1
Slide 10: Recap of First Quarter Results
10 10 RECAP OF FIRST QUARTER RESULTS $162.0 $185.8 Q1 FY2019 Q1 FY2020 $9.8 $16.1 Q1 FY2019 Q1 FY2020 INCOME FROM OPERATIONS ($MM) 9.4% 11.1% 0.9% Consolidated Stores E-commerce 14.7% Growth Q1 FY2020 6.1% of sales 8.6% of sales NET SALES ($MM) SAME STORE SALES 63.4% Growth
Slide 11: Strategic Initiatives: Drive Same Store Sales Growth
11 11 STRATEGIC INITIATIVES CONTINUE OMNI - CHANNEL LEADERSHIP BUILD OUT EXCLUSIVE BRAND PORTFOLIO EXPAND OUR STORE BASE 1 2 3 4 DRIVE SAME STORE SALES GROWTH
Slide 12: Segmentation Drives Marketing & Merchandising Execution
12 SEGMENTATION DRIVES MARKETING & MERCHANDISING EXECUTION SEGMENTATION MERCHANDISING MARKETING
Slide 13: Enhanced In-Store Experience Should Drive Conversion
13 13 ENHANCED IN - STORE EXPERIENCE SHOULD DRIVE CONVERSION RANGE FINDER (BOOT SELECTOR) • Creates in - store experience & increases in - store conversion • Assists customers in finding in - store inventory • Trains store associates • Provides brand and product information ENDLESS AISLE CAPABILITY
Slide 14: Strong SSS Growth While Reducing Promotions
14 14 7.4% 7.7% 13.8% 16.2% 14.2% 14.1% 18.1% 19.6% 16.9% 17.8% 14.3% 10.7% 7.5% 8.2% 7.1% 3.8% 8.9% 7.7% 7.3% 7.2% 7.0% 5.6% 0.1% - 2.0% - 1.2% 0.4% 1.8% 0.2% - 0.9% 1.3% 1.8% 5.2% 12.1% 11.6% 11.3% 9.2% 8.7% 9.4% Q4 '10 Q1 '11 Q2 '11 Q3 '11 Q4 '11 Q1 '12 Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q
Slide 15: Strategic Initiatives: Omni-Channel Leadership
15 15 15 STRATEGIC INITIATIVES CONTINUE OMNI - CHANNEL LEADERSHIP EXPAND OUR STORE BASE 1 2 3 4 DRIVE SAME STORE SALES GROWTH BUILD OUT EXCLUSIVE BRAND PORTFOLIO
Slide 16: Three Distinct Brands Online
16 16 THREE DISTINCT BRANDS ONLINE
Slide 17: Digital Innovation
17 17 DIGITAL INNOVATION BUY ONLINE PICK UP IN STORE SEAMLESS E - COMMERCE RETURNS IN STORE B2B WEBSITE SOCIAL SHOPPING INTEGRATION
Slide 18: Profitability Initiative Driving Improved E-Commerce EBIT
18 18 PROFITABILITY INITIATIVE DRIVING IMPROVED E - COMMERCE EBIT Increasing the penetration of exclusive brands online Lowering drop ship fees from our vendors Optimizing marketing spend (ROAS) Eliminating unprofitable and low - margin items 1 2 3 4
Slide 19: Strategic Initiatives: Build Out Exclusive Brand Portfolio
19 STRATEGIC INITIATIVES BUILD OUT EXCLUSIVE BRAND PORTFOLIO EXPAND OUR STORE BASE 1 2 3 4 DRIVE SAME STORE SALES GROWTH CONTINUE OMNI - CHANNEL LEADERSHIP
Slide 20: Exclusive Brands Positioned Strategically
20 20 MEN’S LADIES LEGACY CUSTOMER EXCLUSIVE BRANDS POSITIONED STRATEGICALLY WORK MEN’S LADIES LEGACY CUSTOMER EXPANDED CUSTOMER BASE
Slide 21: Penetration of Exclusive Brands Continues to Grow
21 21 • Fiscal 2020 growth penetration > 400 basis points • Margin enhancement (1,000 bps) EXCLUSIVE BRAND OPPORTUNITIES EXCLUSIVE BRAND SALES PENETRATION 1 (% of sales) 2.6% 16.2% 20% FY2012 FY2019 Q1 FY2020 1 Represents total company exclusive brand penetration. PENETRATION OF EXCLUSIVE BRANDS CON
Slide 22: Exclusive Brands Are Leading Brands in the Store
22 22 EXCLUSIVE BRANDS ARE LEADING BRANDS IN THE STORE Western Work / Other TOP 5 brands 2 1 3 4 5 = Exclusive brands
Slide 23: Strategic Initiatives: Expand Our Store Base
23 23 STRATEGIC INITIATIVES CONTINUE OMNI - CHANNEL LEADERSHIP BUILD OUT EXCLUSIVE BRAND PORTFOLIO EXPAND OUR STORE BASE 1 2 3 4 DRIVE SAME STORE SALES GROWTH
Slide 24: Opportunity Exists to Double Store Count
24 24 OPPORTUNITY EXISTS TO DOUBLE STORE COUNT 86 117 152 169 208 219 226 240 264 FY 12 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY 20 Outlook HISTORICAL STORE BASE COMPELLING NEW STORE ECONOMICS GOALS Store Size (sq. ft.) 10,000 Year 1 Net Sales $1.7mm Net Cash Investment $0.8 mm Cash on Cash Retu
Slide 25: Reach of E-Commerce Supports Store Expansion
25 25 REACH OF E - COMMERCE SUPPORTS STORE EXPANSION Today • 240 stores • 33 states STORES 1 Represents e - commerce sales dollars by state for the fiscal year ended March 30, 2019. More Less E - COMMERCE 1
Slide 26: U.S. Western Wear Chains (Estimated Store Count)
26 U.S. WESTERN WEAR CHAINS (ESTIMATED STORE COUNT) 1 7 84 240 > 2.5x as many stores as closest competitor National Regional (Mostly Texas) Independent retailers North & South Carolina 1 Store count as of July 31, 2019. Thousands TUCK - IN ACQUISITIONS ADDING OUTSIZED SALES PER STORE Tuck - In Acqui
Slide 27: Appendix
27 APPENDIX
Slide 28: Adjusted EBITDA and Adjusted EBIT Reconciliation
28 ADJUSTED EBITDA AND ADJUSTED EBIT RECONCILIATION (a) Represents non - cash compensation expenses related to stock options, restricted stock awards and restricted stock units grant ed to certain of our employees and directors. (b) Represents the non - cash accrual for future award redemptions in c
Slide 29: Potential Tariff Exposure
29 29 POTENTIAL TARIFF EXPOSURE ~ 50% ~ 40% ~ 10% All Other China sourced exclusive brands China sourced 3 rd party vendor brands Approx. % of Total Sales Sourced from China In order to maintain margin dollars on a $179 pair of boots subsequent to the 10% tariff beginning on Sept. 1 st , the new sel
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