Slide 1: Q1 2020 Results
THE ANALYST DAY PRESENTATION 2018 Q1 2020 RESULTS May 13, 2020
Slide 2: Note on Forward-Looking Statements
PAGE 2 Note on Forward-Looking Statements Information in this presentation contains forward-looking statements as defined within the meaning of U.S. federal securities laws, including, but not limited to, statements regarding our expectations around the continued impact of the COVID-19 pandemic on o
Slide 3: Statement on One-Time Disclosures Due to COVID-19
PAGE STATEMENT ON ONE-TIME DISCLOSURES DUE TO COVID-19 3 COVID-19 Impact Began in March: The COVID-19 outbreak has severely affected consumer spending across many sectors of the global economy and had a significant negative impact on REVOLVE’s results for the first quarter ended March 31, 2020 and f
Slide 4: Summary: Good Start to Q1 2020, Offset by COVID-19 Impact in March
PAGE SUMMARY: GOOD START TO Q1 2020, OFFSET BY COVID-19 IMPACT IN MARCH 4 Monthly trends for March reflects partial impact and April reflects full impact of the COVID-19 Pandemic, including “shelter in place” mandates and shifting consumer demand (1st month only) Q1 2020 Ended March 31, 2020 Q2 2020
Slide 5: Summary of Initial Response to COVID-19
PAGE SUMMARY OF INITIAL RESPONSE TO COVID-19 5 OPERATIONAL FINANCIAL Protecting Employees Managing Cost Structure • Ensuring the safety of employees is our top • Managing every aspect of cost structure to priority “variabilize” costs as much as possible • Corporate staff successfully transitioned to
Slide 6: Income Statement Highlights
PAGE INCOME STATEMENT HIGHLIGHTS (YoY comparisons skewed by COVID-19 impact in March) 6 NET SALES ($MM) GROSS MARGIN NET INCOME ($MM) ADJUSTED EBITDA(1) ($MM) % ADJ. EBITDA MARGIN +6% YoY $146.1 $137.3 (34%) YoY (290 BPs) YoY (16%) YoY $8.5 51.5% 48.6% $5.0 $5.6 $4.2 6.2% 3.8% Q1 2019 Q1 2020 Q1 201
Slide 7: Operating Metrics Highlights
OPERATING METRICS HIGHLIGHTS PAGE (YoY comparisons skewed by COVID-19 impact in March) 7 ACTIVE CUSTOMERS(1) (000s) TOTAL ORDERS PLACED(1) (000s) AVERAGE ORDER VALUE(1) (TRAILING 12 MONTHS) +21% YoY 1,528 Flat YoY 1,262 +3% YoY $259 $259 1,135 1,172 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Q1 2019 Q1 2020 No
Slide 8: Net Sales by Geography
NET SALES BY GEOGRAPHY PAGE (YoY comparisons skewed by COVID-19 impact in March) 8 U.S. / INTERNATIONAL INTERNATIONAL MIX OF TOTAL NET SALES YoY NET SALES GROWTH Q1 2020 Q1 2019 Q1 2020 + 17% 16% 18% + 4% U.S. International INTERNATIONAL NET SALES U.S. NET SALES
Slide 9: Segment Net Sales
PAGE SEGMENT NET SALES (YoY comparisons skewed by COVID-19 impact in March) 9 REVOLVE SEGMENT NET SALES ($MM) FORWARD SEGMENT NET SALES ($MM) +1% YoY $122.7 $124.5 $97.0 $74.1 +47% YoY $21.6 $16.1 $16.3 $14.7 Q1 2017 Q1 2018 Q1 2019 Q1 2020 Q1 2017 Q1 2018 Q1 2019 Q1 2020
Slide 10: Segment Gross Profit
PAGE SEGMENT GROSS PROFIT (YoY comparisons skewed by COVID-19 impact in March) 10 REVOLVE SEGMENT GROSS PROFIT ($MM) FORWARD SEGMENT GROSS PROFIT ($MM) (4%) YoY $65.3 $62.4 $50.6 $34.0 +56% YoY $8.6 $5.8 $5.5 $4.8 Q1 2017 Q1 2018 Q1 2019 Q1 2020 Q1 2017 Q1 2018 Q1 2019 Q1 2020
Slide 11: GAAP Cost Structure
PAGE GAAP COST STRUCTURE 11 Q1 COSTS YoY CHANGE AS A % OF NET SALES (ROUNDED) OBSERVATIONS: Marketing: Marketing deleverage primarily reflects increased 12.9% 14.0% investment costs in the quarter as well as reduced efficiency from the negative COVID-19 impact on net sales late in the quarter and Br
Slide 12: Earnings Per Share and the EPS Math
EARNINGS PER SHARE PAGE (YoY comparisons skewed by COVID-19 impact in March) 12 EARNINGS PER THE EPS MATH SHARE (000s, except per share figures) Q1 2020 Q1 2019 Net income $4,156 $4,962 Net income attributable to participating security ---- (1,785) (14%) YoY Net income attributable to common stockho
Slide 13: Cash Flow Highlights
CASH FLOW HIGHLIGHTS PAGE (YoY comparisons skewed by COVID-19 impact in March) 13 NET CASH PROVIDED BY OPERATING ACTIVITIES ($MM) CAPITAL EXPENDITURES ($MM) FREE CASH FLOW (1) ($MM) $15.9 $10.9 $8.1 $7.5 $5.0 $0.6 Q1 2019 Q1 2020 Q1 2019 Q1 2020 Q1 2019 Q1 2010 Notes: 1. See Slide 16 for a definitio
Slide 14: Cash and Equivalents Bridge ($M)
PAGE CASH AND EQUIVALENTS BRIDGE ($M) 14 $30.0 $0.7 $103.6 $7.5 $65.4 Credit Line Summary as of 3/31/2020 Total line $75 Million(1) Drawn $30 Million Interest rate 1.5% + 6 month LIBOR Cash at Free Cash Flow Draw from Credit Proceeds from Cash at 12/31/2019 Line Exercise of Stock 3/31/2020 Options /
Slide 15: Capital Expenditures Trend and Outlook
PAGE CAPITAL EXPENDITURES TREND AND OUTLOOK 15 ANNUAL CAPITAL EXPENDITURES ($M) CAPEX % OF NET SALES $12.5 FY 2020 CapEx Target Reduced 60% 2.1% $5.0 $3.0 1.0% $3.0 $2.3 $2.0 0.6% 0.6% 0.4% 2016 2017 2018 2019 2020 Prior 2020 New 2016 2017 2018 2019 Q1 2020 Est. Est.
Slide 16: Metrics Definitions
PAGE METRICS DEFINITIONS 16 Non-GAAP Financial Measures Adjusted EBITDA is a non-GAAP financial measure that we calculate as net income before other expense, net, taxes, depreciation and amortization, adjusted to exclude the effects of equity-based compensation expense, and certain non-routine expen
Slide 17: GAAP to Non-GAAP Reconciliation
PAGE GAAP TO NON-GAAP RECONCILIATION 17 - ADJ. EBITDA ($MM) Q1 2020 Q1 2019 NET INCOME $4.2 $5.0 (+) OTHER (INCOME) EXPENSE, NET (0.1) 0.2 (+) (BENEFIT FROM) PROVISION FOR INCOME TAXES (0.2) 1.7 (+) DEPRECIATION AND AMORTIZATION 1.2 0.7 (+) EQUITY-BASED COMPENSATION 0.6 0.5 (+) NON-ROUTINE EXPENSES