Tuesday Morning Corp New · OTC:TUEMQ
Tuesday Morning Corp New — Tuesday Morning — Investor Presentation (June 2017)
17 slides from Tuesday Morning Corp New's investor presentation, Jun 5, 2017
Slide 1: Safe Harbor Statement
Safe Harbor Statement Cautionary Statement Regarding Forward-Looking Statements This presentation contains forward-looking statements, which are based on management's current expectations, estimates and projections and are not guarantees of future performance. Forward looking statements include stat
Slide 2: Tuesday Morning: Who We Were
Tuesday Morning: Who We Were • Founded in 1974 as a “pop up” store in Dallas, Texas • Original concept was event driven with warehouse sales conducted 4x per year • Small assortment of first quality, closeout merchandise sold at a 50% to 80% discount • Concept evolved to being open year round • Stor
Slide 3: Tuesday Morning: Who We Are
Tuesday Morning: Who We Are • Off-price retailer offering upscale, name brand merchandise at compelling price points • Deal driven merchandise assortment, opportunistically sourced from multiple channels including close outs, contracted surplus production capacity and direct production • Merchandise
Slide 4: Tuesday Morning: Where We Are Located
Tuesday Morning: Where We Are Located 724 stores in 40 states as of 3/31/17 NH (0) VT (0) WA (14) ME (0) MA (2) ND (1) MT (0) MI (9) RI (0) OR (13) MN (9) ID (5) NY (11) SD (1) WI (7) CT (0) WY (0) PA (20) IA (5) NE (4) NJ (11) NV (6) OH (23) IL (15) IN (14) UT (6) CO (20) WV (0) DE (3) VA (34) KS (
Slide 5: Unique High-End Merchandise Assortment
Unique High-End Merchandise Assortment Merchandise Sales Contribution as of 3/31/17 • Curated merchandise assortment • Better/best national and specialty store brands Home Décor 29% Housewares 28% • Product offering unique from our competition Seasonal 15% Textiles 28% • Store environment provides a
Slide 6: Management Team and Retail Experience
Name Title Retail Experience Tuesday Morning Experience Prior Experience Steven R. Becker Chief Executi ve Officer &+Years 4+ Years Value creator with eKtensive publ c company board experience Staci e Shirl ey Executi ve Vi ce Presi dent, Chi ef Financi alOffi cer and Treasurer 24+ Years 1+ Years --
Slide 7: Strategic Opportunities to Return to Profitable Growth
Strategic Opportunities to Return to Profitable Growth Primary Areas of Strategic Focus Include: • Real Estate Repositioning • Supply Chain Efficiencies and Productivity • Merchandise and Inventory Optimization • Marketing Productivity 8
Slide 8: Real Estate Strategy: Remains #1 Priority
Real Estate Strategy:Remains #1 Priority • Touched approximately 25% of store base since FY2015 • Focus is on moving from C/D locations to solid B and better shopping centers with favorable co-tenancy and customer demographics New Prototype Original Format 9
Slide 9: Strong co-tenancy drives favorable customer demographics and traffic
Strong co-tenancy drives favorable customer demographics and traffic Tues J'torning
Slide 10: Real Estate Strategy: Development Roadmap
Real Estate Strategy: Development Roadmap FY18 1 FY15 - FY18 1 FY15 FY16 FY17 Relocation & Expansions 52 Relocations 13 Expansions 45 Relocations 10 Expansions 30 relocations 7 Expansions 46 Relocations 7 Expansions 173 Relocations 37 Expansions New Store Growth 5 New Stores 16 New Stores 22 New Sto
Slide 11: Real Estate Strategy: Relocation Economics
Real Estate Strategy: Relocation Economics Store Size 1 Year 1 Sales 2 Store Contribution Margin 3 Net Investment 4 Payback Period 10K – 12K sq/ft ~$1.6 million ~15% ~$400K ~2 years $1,840 $1,310 $1,270 $1,060 $700 $640 1 Targeted store size is 10K – 12K, but actual results vary based upon real esta
Slide 12: Supply Chain: Work to Build Efficiencies & Improve Productivity
Supply Chain: Work to Build Efficiencies & Improve Productivity • Prior to 2016, operated one distribution center in Dallas – Dallas DC consists of 5 non-contiguous buildings, creating a very inefficient process due to multiple touches required • Opened new 600K square foot state of the art DC in Q4
Slide 13: Marketing Productivity: Optimize Spend to Drive Traffic Efficiently
Marketing Productivity: Optimize Spend to Drive Traffic Efficiently Legacy Marketing Program Current Marketing Focus • • • Focused on monthly promotional sales events Majority of ad spend focused on print advertising Hired new marketing leadership Testing more effective media, reducing reliance on p
Slide 14: Merchandising/Inventory Management
Merchandising/Inventory Management • Merchandising Focus – – Created new General Merchandise Manager role Eliminating non-core businesses that are no longer aligned with our merchandise strategy Increased focus on merchandise in-store presentation to drive higher average ticket Continued testing of
Slide 15: Balance Sheet / Cash Flow
Balance Sheet / Cash Flow • Line of credit has ample room to support projected investments – – – $180M Asset Backed Facility 5 year facility maturing August 2020 No financial covenants (if specified availability levels are maintained) • Owned real estate provides additional flexibility – – Corporate
Slide 16: Tuesday Morning Future: Long Term Outlook
Tuesday Morning Future: Long Term Outlook Real Estate Repositioning Sales Supply Chain Efficiencies and Productivity Gross Margin Sales Gross Merchandise and Inventory Optimization Margin Marketing Productivity Sales 17
Slide 17: Tuesday Morning Future: Long Term Outlook
Tuesday Morning Future: Long Term Outlook Sales t Real Estate Repositioning Supply Chain Efficiencies and Productivity Gross Margin t Sales t Gross Margin t Sales t Diesdy Moringa Merchandise and Inventory Optimization i ie ae | Marketing Productivity