XPEL, Inc. · NASDAQ:XPEL
XPEL — Q3 2019 Earnings Presentation
25 slides from XPEL's earnings presentation, November 2019
Slide 1: Investor Presentation November 2019
INVESTOR PRESENTATION NOVEMBER 2019
Slide 2: Forward Looking Statements
This Presentation contains certain forward-looking statements in respect of various matters including upcoming events that involve known and unknown risks and uncertainties that are beyond the control of Management. Those risks and uncertainties include, among other things, risks related to: share p
Slide 3: The Leader in Protective Films
AUTOMOTIVE PAINT PROTECTION FILMS AUTOMOTIVE WINDOW TINT ARCHITECTURAL WINDOW FILMS THE THE LEADER LEADER IN IN PROTECTIVE PROTECTIVE FILMS FILMS 3
Slide 4: A Brand Built Over 20+ Years
HEADQUARTERED IN 2400+ CUSTOMERS SAN ANTONIO, TX OPERATIONS IN 6 COUNTRIES FOUNDED IN 1997 9 COMPANY OWNED NASDAQ: XPEL INSTALL CENTERS 200 FULL TIME EMPLOYEES A BRAND BUILT OVER 20+ YEARS 4
Slide 5: Global Footprint
MONTREAL, QUEBEC CANADIAN HEADQUARTERS LETCHWORTH, UNITED KINGDOM UK HEADQUARTERS YILAN, TAIWAN ASIA HEADQUARTERS SAN ANTONIO, TX US/GLOBAL HEADQUARTERS TILBURG, NETHERLANDS EUROPEAN HEADQUARTERS STUTTGART, GERMANY GERMANY HEADQUARTERS GUADALAJARA, MEXICO MEXICO HEADQUARTERS COMPANY OWNED INSTALLATI
Slide 6: History That Continues to Set the Standards
OPEN PA R A S O L ASIA OFFICE C A N A DA ACQUISITION ULTIMATE ULTIMATE PLUS PA I N T P R O T E C T I O N F I L M A U T O M O T I V E W I N D OW F I L M PA I N T P R O T E C T I O N F I L M 1998-2005 2007 2010 2011 2014 2015 2016 2017 2018 2019 (SYMBOL: XPEL) STANDARD PA I N T P R O T E C T I O N F I
Slide 7: Competitive Differentiators
FILM TECHNOLOGY DISTRIBUTION INFRASTRUCTURE Self-healing, Durable & Stain Resistant Inventory In Several Locations Globally Ease of Installation Meets Just In Time Needs of Customers DAP SOFTWARE CUSTOMER SERVICE Unmatched Quality & Fit, Saves Installation, Software & Installer Time & Money Training
Slide 8: Key Investment Highlights
Strong Recognition as Premium Brand M TECHNOLOGY FIL DA Significant Domestic and International C E P I RV SO Market Opportunity SE FT WA R ME RE CUSTO Robust Growth, Profitability and Strong Balance Sheet MARKE PRODUCTS URE TIN High Insider Ownership Creates Firm CT G RU Alignment with Shareholders
Slide 9: Ultimate Plus
ULTIMATE PLUS TM PA I N T P R OT E C T I O N F I L M Protects: Bumpers, Hood, Headlights/ Fog Lights, Fenders, A-Pillars, Roofline, Mirrors, Door Edges, Door Cups, Door Sills, Rocker Panels, Rear Wheel Impact, and Luggage Strip COVERAGE BUMPER HOOD HEADLIGHTS & FOG LIGHTS FENDERS MIRRORS A-PILLARS &
Slide 10: Automotive Products
ULTIMATE PLUS PA I N T P R O T E C T I O N F I L M A U T O M O T I V E W I N D OW F I L M C E R A M I C C O A T I N G Invisible, Cut-To-Fit Film for Heat Rejection, Hydrophobic Coating Protection Film Security and Appearance Applied to PPF and Painted Surfaces Protects from Rock Chips, 4 Core Lines
Slide 11: End Customer PPF Economics
COVERAGE - FULL CAR COVERAGE - FULL FRONT COVERAGE - PARTIAL HOOD Covers entire car. Covers entire painted front bumper, hood, fenders, Covers 6” - 12” of leading edge of hood. headlights and backs of the painted mirrors. $4000 - $5000 $100 - 200 $1800 - $2500 PRICE DETERMINATION Complexity Of Insta
Slide 12: Architectural Window Films
ARCHITECTURAL WINDOW FILMS RX PROTECTION FILM SURFACE PROTECTION Solar Control and Security Anti-Microbial Surface Sell to a Variety of Niche for Commercial and Protection Non-Automotive Uses Residential Applications Screens, Electronics, Electronics, Stainless Steel, Distinct Customer Set, But Cons
Slide 13: The XPEL Difference
CERTIFIED BRAND TRAINING PRESENCE Cloud-Based Application Essential to New Customer Extensive On and Off-line Updated Daily with 80,000 Success and Industry Growth Marketing and Lead Vehicle Applications Generation Corporate Training Facilities Pre-Cut Film Prevents in 5 Countries Sponsorships, Even
Slide 14: XPEL Revenue Ecosystem
PRODUCT REVENUE 94 % INSTALLATION SERVICE REVENUE 6% $ 150 - $ 375 / CAR DIRECT - 65 % INDIRECT - 35 % SERVICE LOCATIONS US UK CANADA INTERNATIONAL DISTRIBUTORS 6 1 2 INDEPENDENT NEW CAR INSTALLERS DEALERSHIP $ 800 - $ 2500 $ 600 - $ 1500 / CAR / CAR END END NEW CAR CONSUMER CONSUMER DEALERSHIP XPEL
Slide 15: Strategic Initiatives
CONTINUE GLOBAL EXPANSION XPEL European Headquarters Established in 2017 XPEL Taiwan Headquarters Established in 2018 XPEL Germany Headquarters Established in 2019 Build Out Sales Team In Under-penetrated Geographies DRIVE GLOBAL BRAND AWARENESS High Visibility At Premium Events Advertising Placemen
Slide 16: Annual Revenue
$109.9M $110,000 $100,000 $90.4M $90,000 Q3 GR $35.6 M $80,000 C A 21.9% % 8.8 GROWTH 63.4% $70,000 3 Q vs Q $67.3M $60,000 29.9% $51.8M $50,000 Q2 24.8% $30.1 M $41.5M 4.5% $40,000 GROWTH 39.9% Q vs Q $29.6M $30,000 Q1 $20,000 $24.7 M (1.6%) $10,000 GROWTH Q vs Q 2014 2015 2016 2017 2018 2019 IFRS
Slide 17: Sept 2019 YTD Sales Mix by Region
CONTINENTAL EUROPE 5.9% UK CANADA 3.1% 14.7% UNITED STATES 49.5% CHINA 18.8% ASIA PACIFIC 3.4% LATIN MIDDLE EAST / AMERICA AFRICA 1.7% 2.6% OTHER 0.3% SEPT 2019 YTD SALES MIX BY REGION 17
Slide 18: Gross Margin Trend
$40,000 50.0% $33.4M $35,000 40.0% $30,000 35.3% 34.5% 33.0% 31.2% 30.4% 29.7% $25,000 30.0% 27.1% 24.8% $20,000 GROSS $16.7M 20.0% GROSS MARGIN MARGIN $ % $15,000 $14.0M $12.3M $12.3M $10.6M 10.0% $10,000 $9.3M $8.2M $5,000 0.0% 2014 2015 2016 2017 2018 Q1 2019 Q2 2019 Q3 2019 IFRS U.S. GAAP GROSS
Slide 19: EBITDA Profile
$13.2M $13.0M $13,000 85.0% $12,000 80.0% $11,000 75.0% 70.0% $10,000 65.0% $9,000 60.0% $8,000 55.0% 50.0% $7,000 45.0% $6,000 40.0% 35.0% $5,000 EBITDA $4.4M EBITDA 30.0% $ % $4,000 $3.6M $3.6M 25.0% $3.3M $3,000 20.0% 15.0% $2,000 14.5% 11.9% 10.0% 11.1% $1,000 8.6% 8.5% 5.0% 5.4% 0.0% 2014 2015
Slide 20: Net Income
$10,000 $9.4M $9,000 $8.7M 50.0% $8,000 45.0% $7,000 40.0% $6,000 35.0% NET $5,000 30.0% NET INCOME INCOME $ 25.0% % $4,000 $3.1M 20.0% $3,000 $2.2M 15.0% $2,000 $1.5M 10.0% $1.0M 10.4% 10.4% $1,000 7.9% 5.0% 3.6% 4.2% 1.5% 0.0% 2014 2015 2016 2017 2018 Q3 2019 YTD IFRS U.S. GAAP NET INCOME (IN MILL
Slide 21: Strong Financial Position
2017 2018 Q 3 2019 CURRENT RATIO 1.45 2.48 2.59 NET WORKING CAPITAL $6.3M $12.5M $20.3M ACCOUNTS RECEIVABLE $5.4M $5.6M $7.3M TOTAL INVENTORY $10.5M $10.8M $16.4M TOTAL ASSETS $27.8M $30.5M $47.4M TOTAL DEBT $4.0M $1.8M $1.0M (EXCLUDES LEASE OBLIGATIONS) DEBT TO EQUITY RATIO 31.6 % 8.8 % 3.3% (EXCLU
Slide 22: Macro Growth Opportunities
Rock Chips Are Top Consumer Complaint Paint Protection Film Low Penetration to New Cars Sold Fragmented Market Provides Opportunity Ripe for Consolidation Dealerships Need Tangible, Profitable Products Window Film First Example of Leveraging Channel Opportunity Equivalent Opportunities Domestically
Slide 23: Appendix
APPENDIX
Slide 24: Non-GAAP Measures EBITDA Reconciliation
THREE MONTHS THREE MONTHS THREE MONTHS NINE MONTHS YEAR ENDED ENDED ENDED ENDED ENDED DEC 31, 2018 MARCH 31, 2019 JUNE 30, 2019 SEPT 30, 2019 SEPT 30, 2019 NET INCOME $8,721,232 $1,860,003 $3,007,310 $4,509,285 $9,376,598 INTEREST $168,389 $28,706 $29,074 $23,851 $81,631 TAXES $2,760,073 $565,888 $9
Slide 25: Complete Protection, Unseen.
San Antonio, TX USA +1 210-678-3700 XPEL.COM COMPLETE PROTECTION, UNSEEN.