Slide 1: Third Quarter 2018 Earnings
Third Quarter 2018 Earnings November 8, 2018 Exhibit 99.2
Slide 2: Cautionary Notes
Cautionary Notes This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this presentation, including statements regarding our future results of operations
Slide 3: Built on the principle that everyone is a fan of something
is built on the principle that everyone is a fan of something
Slide 4: Third Quarter 2018 Snapshot
Third Quarter 2018 Snapshot Net Sales 24% YoY Growth Adj. EBITDA(1) 26% YoY Growth Adj. Pro Forma Net Income(1) 127% YoY Growth Net Sales increased 24% to $176.9m in Q3’18 compared to Q3’17 Net Sales growth driven by broad-based growth across product categories and geographies Pop! Brand > 30% YoY G
Slide 5: Q3 & YTD Earnings Summary
Q3 & YTD Earnings Summary 3Q’18 3Q’17 % Change YTD’18 YTD’17 % Change Net Sales Gross Profit(1) Gross Margin %(1) Operating Income Operating Margin % Net Income (Loss) Adj. Pro Forma Net Income(2) Adj. Pro Forma Net Income Margin(2) Adj. Pro Forma Earnings per Share(2) Adj. EBITDA(2) Adj. EBITDA Mar
Slide 6: Q3 & YTD Active Properties & Net Sales per Active Property
Q3 & YTD Active Properties & Net Sales per Active Property Active Properties & Net Sales per Active Property Third Quarter Year to Date Active Properties Net Sales per Active Property Active Properties up 38% Net Sales per Active Property down 10% Active Properties up 28% Net Sales per Active Proper
Slide 7: Top Properties Breakout
Top Properties Breakout Q4’17 Q1’18 Q2’18 Q3’18 1 2 3 5 7 4 6 8 9 10 Top 10 Properties % of Sales 39% 38% 38% 34% No property was > 7% of sales in Q3’18 Top 10 properties were only 34% of sales in Q3’18 Evergreen content was 53% of sales in Q3’18
Slide 8: Q3 & YTD Product Category Performance
Q3 & YTD Product Category Performance Figures Other Third Quarter Year to Date Third Quarter Year to Date Select New Products + Advent Calendar $ in millions 24% Growth 30% Growth 33% Growth 26% Growth
Slide 9: Q3 & YTD Geographic Performance
Q3 & YTD Geographic Performance United States International Third Quarter Year to Date Third Quarter Year to Date Excluding Loungefly, U.S. specialty channel is up over 30% YTD due to increased shelf space and sell-through 3rd party e-commerce sites are up over 55% YTD In Q3’18, sell-through was up
Slide 10: Walmart Activation
Walmart Activation
Slide 11: Activation
Activation Consistently we see retailers looking to get into the business of pop culture and is often their solution
Slide 12: Thalia Activation (Germany)
3 Thalia Activation (Germany)
Slide 13: Other International Activations
Other International Activations (Kuwait) (UAE) (Spain)
Slide 14: Fan Engagement
Fan Engagement Will attend 50+ global consumer and Fan engagement events in 2018 Video short views across all platforms: Over 60 million in Q3 Over 150 million + YTD > 160 million impressions in Q3’18 > 460 million impressions in Q3’18 > 180 million impressions in Q3’18 > 25 million minutes spent wa
Slide 15: Trailing Five Quarters Gross Margin Trend
Trailing Five Quarters Gross Margin(1) Trend Long-term annual Gross Margin(1) goal of 39%(2) Gross Margin is calculated exclusive of depreciation and amortization. This goal is forward-looking, is subject to significant business, economic and competitive uncertainties and contingencies, many of whic
Slide 16: Q3 & YTD Adjusted EBITDA
Q3 & YTD Adjusted EBITDA(1) Adjusted EBITDA(1) Third Quarter Year to Date Adj. EBITDA Margin %(1) 18.9% 19.2% 16.8% 15.8% $ in millions, unaudited Adj. EBITDA Margin(1) increased 30bps in Q3’18 over prior year; beginning to gain operating leverage in Q3’18 See Supplemental Financial Information sect
Slide 17: Q3 & YTD Adjusted Pro Forma Net Income
Q3 & YTD Adjusted Pro Forma Net Income(1) Adjusted Pro Forma Net Income(1) Third Quarter Year to Date Adjusted Pro Forma Net Income Margin(1) 4.2% 7.8% 2.2% 4.2% $ in millions, unaudited Adjusted Pro Forma Net Income improving due to the growth in net sales, reductions in interest expense and the de
Slide 18: Key Balance Sheet Highlights
Key Balance Sheet Highlights 9/30/2018 12/31/2017 % Change Cash & Cash Equivalents Accounts Receivable, net Inventory Total Debt(1) $10.6 $127.0 $81.2 $259.1 $ in millions, unaudited Net Debt(2) $248.5 $7.7 $115.5 $79.1 $233.9 $226.2 36.9% 10.0% 2.7% 10.8% 9.9% Total Debt is defined as Line of Credi
Slide 19: Fiscal Year 2018 Guidance
Fiscal Year 2018 Guidance Fiscal Year 2018 Guidance Range(1) % Growth YoY Net Sales Adjusted EBITDA(2) Adjusted Pro Forma EPS(2) $645 to $650 million $108 to $112 million $0.68 to $0.73 25% to 26% 20% to 25% 100% to 115% The guidance should be read in conjunction with Funko’s third quarter 2018 rele
Slide 20: Refinancing Benefits and Overview
Refinancing Benefits and Overview $235.0 million term loan and $50.0 million revolving credit facility Matures in October 2023, five years from the closing date Loans will initially bear interest at LIBOR plus 3.25% $25.0 million increase option Due to the refinancing, in Q4’18 we anticipate we will
Slide 21: Supplemental Financial Information
Supplemental Financial Information
Slide 22: Q3 and YTD Condensed Consolidated Statements of Operations
Q3 and YTD Condensed Consolidated Statements of Operations $176,915 108,898 68,017 38.4% 41,267 - 9,961 16,789 5,750 1,434 9,605 1,519 $8,086 6,056 $2,030 $ in thousands, unaudited Net Sales Cost of Sales(1) Gross Profit(1) Gross Margin(1) Selling, General and Administrative Expenses Acquisition Tra
Slide 23: Condensed Consolidated Balance Sheet
Condensed Consolidated Balance Sheet 9/30/2018 12/31/2017 Cash and Cash Equivalents Accounts Receivable, net Inventory Prepaid Expenses & Other Current Assets Total Current Assets Property & Equipment, net Goodwill Intangible Assets, net Deferred Tax Asset Other Assets Total Assets Line of Credit Cu
Slide 24: Reconciliation of Non-GAAP Financial Metrics
Reconciliation of Non-GAAP Financial Metrics Represents the reallocation of net income attributable to non-controlling interests from the assumed exchange of common units of FAH, LLC for Class A common stock in periods in which income was attributable to non-controlling interests. Represents monitor
Slide 25: Reconciliation of Non-GAAP Financial Metrics Cont.
Reconciliation of Non-GAAP Financial Metrics Cont. Represents monitoring fees paid pursuant to a management services agreement with ACON that was entered into in connection with the ACON acquisition, which terminated upon the consummation of the IPO in November 2017. Represents non-cash charges rela
Slide 26: Guidance Reconciliation of Net Income to EBITDA and Adjusted Metrics
Guidance Reconciliation of Net Income to EBITDA, Adjusted EBITDA, Adjusted Pro Forma Net Income and Adjusted Pro Forma Earnings per Diluted Share Represents non-cash charges related to equity-based compensation programs, which vary from period to period depending on timing of awards. Represents lega
Slide 27: Slide 27