Signet Jewelers Limited · NYSE:SIG
Signet Jewelers — Investor Presentation (August 2023)
36 slides from Signet Jewelers's investor presentation, Aug 31, 2023
Slide 1: August 2023 Investor Presentation
AUGUST 2023 INVESTOR PRESENTATION Exhibit 99.2
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT This presentation contains certain forward-looking statements. Any statements that are not historical facts are subject to a number of risks and uncertainties, and actual results may differ materially. We urge you to read the risk factors, cautionary language, and other disclos
Slide 3: A Transformed Signet Presents a Strong Investment Thesis
Attractive Category Within Retail Growth Oppor tunities A Transformed Company Differentiated banners Retail footprint optimization Flexible operating model Stronger financial performance Growth Potential with Unique Scale in the Attractive Jewelry Category A TRANSFORMED SIGNET PRESENTS A STRONG INVE
Slide 4: Signet Is the Leading Global Diamond Retailer at 3x the Size of Nearest Competitor
1 - As of FY23 year-end 2 – Jewelry market reflects the combination of CY22 US estimated market of $65 billion, Canadian estimated market of C$5.7 billion and UK estimated market of £6.4 billion translated at 12/30/22 Fx rates 3 - Average of FY22-FY23 actuals and FY24 based on the mid-point of FY24
Slide 5: Balanced Capital Allocation Strategy and Widening Competitive Advantages
Balanced capital allocation strategy Widening competitive advantages: estimated 3 points share growth in 3 years1 • Utilize scale to capture sourcing benefits • Leverage acquisition integration opportunities • Personalization and digital • Connected commerce provides unique shopping journey • Organi
Slide 6: Transformation Over the Last 4 Years Has Doubled Non-GAAP Operating Income
5.2% 9.1% FY20 FY24 Guide 2 $318.3 $655.0 FY20 FY24 Guide 2 $6.1 $7.2 FY20 FY24 Guide 2 6.6% 9.7% FY19 FY2320 Revenue $ (in billions) Estimated U.S. Market Share3 Returned more than $940 million to shareholders through dividends and share repurchases since the star t of FY2020, or near ly 30% of cur
Slide 7: Leverage Ratios and Balance Sheet
All data as of Q2 FY2024 1 - Converted Preferred shares increase diluted share count by 8.2 million shares 2 - See Appendix for reconciliation and definition 3 - The adjusted debt leverage ratios are presented on a trailing twelve-month (“TTM”) basis, which uses Adjusted EBITDAR calculated on the pr
Slide 8: Signet Jewelers: Our Transformation
SIGNET JEWELERS: OUR TRANSFORMATION
Slide 9: Signet Has Fundamentally Transformed Over the Last 5 Years
Old Signet SIGNET HAS FUNDAMENTALLY TRANSFORMED OVER THE LAST 5 YEARS New Signet Mid-Fine & Primarily Bridal Diverse Portfolio Across Semi-Fine, Mid-Tier and Accessible Luxury with Higher Fashion Penetration Banners Overlap and Compete with Each Other Differentiated Banner Value Propositions Aimed a
Slide 10: Customer Segments and Jewelry Market Opportunity
Express their personalities through unique and meaningful design choices and combinations. Unexpected Individualize d Seek to be seen and acknowledged for their taste. Choose jewelry that reflects their/ others style. Bold Stylish On Trend Select and create thoughtful gifts for others which are tied
Slide 11: Strategic Investments, Acquisitions and Fleet Optimization Changed Our Business
Optimizing our physical and digital footpr int has helped dr ive a ~50% increase to FY17 sales PSF STRATEGIC INVESTMENTS, ACQUISITIONS AND FLEET OPTIMIZATION HAVE CHANGED THE ARCHITECTURE OF OUR BUSINESS Digital Investments & Fleet Transformation Have Reduced Mall Penetration ~20 Points Investments
Slide 12: Investments in Digital Lead Our Retail Footprint Optimization
FY17 FY20 FY23 6 Year Change eCommerce Penetration 6% 12% 20% +1400 bps Number of Stores 3,682 3,208 2,808 (24%) Sales Per Square Foot $1,255 $1,334 $1,864 +49% INVESTMENTS IN DIGITAL LEAD OUR RETAIL FOOTPRINT OPTIMIZATION ~ 2/3 of customers utilize both digital and in store channels in their shoppi
Slide 13: Shift From On-Balance Sheet Credit to Third-Party Partnerships
c Provides credit to the large major ity of Signet customers Often offers credit to customers that are passed on for the initial underwr iting Provides customers with an alternative payment option that is not FICO dependent Payment solutions that are becoming increasingly popular with Millennials an
Slide 14: FY24 Revenue Gains Are From Core Market Share Growth & Acquisitions
1 - Reflects mid-point of FY24 guidance, as of 8/31/23 1 SIG’S FY24 REVENUE GAINS ARE FROM CORE MARKET SHARE GROWTH & ACQUISITIONS, NOT A SUSTAINING COVID IMPACT Strategic organic investments and acquisitions drove market share growth, par tially offset by pandemic reduced engagement activity in FY2
Slide 15: Higher Margins Generated by Initiatives & Flexible Model
$318m $655m 5.2% +0 .4% +2.7% +2.9% +3.1% (1.7%) (2.6%) (2.2%) 9.1% +1.3% 1 More than $700 million in cost outs over 4 years HIGHER MARGINS GENERATED BY INITIATIVES & FLEXIBLE MODEL We believe strategic investments position Signet to fur ther grow market share 1 - Reflects mid-point of FY24 guidance
Slide 16: Mid-Term Growth Strategy
MID-TERM GROWTH STRATEGY KAY ZALES JARED Banter | © BlueNile @jousAuss TOCKSbox PEOPLES Jysiener HSAMUEL cmnesr jones GIGNET
Slide 17: Strategy Provides a Clear Path to Strong Growth Over Next 3-5 Years
WE BELIEVE OUR STRATEGY PROVIDES A CLEAR PATH TO DELIVER STRONG GROWTH OVER THE NEXT 3-5 YEARS Signet’s Mid- term Goals 1 - Based on midpoint of FY2024 guidance range as of August 31, 2023 2 - Midterm EPS assumes continued dilution from preferred shares, constant share count and 25% statutory tax ra
Slide 18: Significant Runway for Growth Driven by Strategic Investments
$1B+ Ad d it ion a l Re ve n u e Gr owt h Dr ive r s Win n in g in Dig i t a l So u r c in g C o n n e c t e d C o m m e r c e / O m n i - C h a n n e l a p p r o a c h Fle xib le Op e r a t in g Mo d e l Cap ab ilit y Leve r s Cu lt u r e $0 .6B Ad d it ion a l Re ve n u e $0 .5B Ad d it ion a l Re
Slide 19: Engagement Recovery Expected to Begin Late This Year
ENGAGEMENT RECOVERY EXPECTED TO BEGIN LATE THIS YEAR, WITH MORE THAN 25% GROWTH THROUGH 2026 Engagements: Derived from number of weddings and company estimates. Past internal primary research provides the historical relationship between engagements and weddings. Lisa W. Miller & Associates provided
Slide 20: Accessible Luxury Represents an Attractive Growth Category
Doubling Pace of Openings by Expanding to New Markets End to End ‘White Glove’ Shopping Experience Mature Stores Average More than $15m per Year Leveraging Our Scale & Market Insights Customization Innovations Like the Foundry that Provide Customers with the Opportunity to Design Pieces from Scratch
Slide 21: Leaning Into Accessible Luxury Is Improving Average Transaction Value
• More than 90% of ATV increase in Jared over last 4 years has come from assortment changes and premiumization, with a low single digit impact from taking price • Positioning Jared as an Accessible Luxury Banner, above Kay and Zales Q2 FY24 to Q2 FY20 +40% +60% Compared to N. America ATV >3x N. Amer
Slide 22: Accelerating Margin Accretive Services to Drive Growth
P r i m a r y Se r vi c e O f fe r i n g s Increasing attachment rates through visibility & education Future offerings like foreign repair ESAs Industry leading turnaround times Repair tracker provides peace of mind & transparency B2B opportunity Engraving services Online and in-store ring design ~3
Slide 23: Our Digital Innovation Roadmap
Online Shopping Standard self-directed search & browse Visual search, virtual try-on, virtual appointments AI & data driven content pushes for personalized shopping experiences Fulfillment Standard delivery to customer address Buy online pickup in-store, ship from store, ship to store, same day deli
Slide 24: Margin Expansion Initiatives Fuel Growth
MARGIN EXPANSION INITIATIVES FUEL GROWTH Strategic Revenue Management Optimizing Pricing & Promotions Merchandise Planning Advanced Assortment Planning and Demand Forecasting Driven by AI/Machine Learning NextGen Flexible Fulfillment Reverse Logistics and Inventory Management Supply Chain Acquisitio
Slide 25: A Transformed Signet Presents a Strong Investment Thesis
Attractive Category Within Retail Growth Oppor tunities A Transformed Company Differentiated banners Retail footprint optimization Flexible operating model Stronger financial performance Growth Potential with Unique Scale in the Attractive Jewelry Category A TRANSFORMED SIGNET PRESENTS A STRONG INVE
Slide 26: Sustainability & Culture
SUSTAINABILITY & CULTURE KAY ZALES JARED Banter om Bue Nile @PjwusAuss TOCKSDOX PEOPLES Jysiever H.SAMUEL cRuesr jones SIGNET
Slide 27: Our Purpose: Inspiring Love
OUR PURPOSE: INSPIRING LOVE Our Purpose of Inspiring Love is evident in everything we do, from the ways we empower our 29,6601 diverse team members to all the ways we enable our customers to celebrate their lives and express their love. And, as a Purpose-driven and sustainability-focused company, Si
Slide 28: Our Three Loves: Our Sustainability Framework
2030 Corporate Sustainability Goals OUR THREE LOVES: OUR SUSTAINABILITY FRAMEWORK Love for Our Planet and ProductsLove for All People Social Change Advocates Signet Love Inspires Foundation Governing with Purpose Love for Our Team Employer of Choice Community of Inclusiveness Purpose and Appreciatio
Slide 29: Signet's Three Loves Sustainability Framework
Signet’s Three Loves Sustainability Framework 1. Love for All People 2. Love for Our Team 3. Love for Our Planet and Products https://www.signetjewelers.com/sustainability/report/default.aspx ANNUAL CORPORATE CITIZENSHIP AND SUSTAINABILITY REPORT Highlights • Human Capital Management and DEI Data •
Slide 30: Third Party Recognition
THIRD PARTY RECOGNITION For the four th consecutive year , Signet was designated as a Great Place to Work- Cer tified ق company based on survey responses from our team members. Five consecutive year s selected for the Bloomberg Gender - Equality Index and the only specialty jewelry retailer . WOMEN
Slide 31: Appendix
APPENDIX KAY ZALES JARED Banter BlueNile @Pjaes Aue TOCKsbox Jouoser HSAMUEL envesrsones SIGNET
Slide 32: Annual Spend on Jewelry Gifting Creates Attractive Opportunities
The engagement category is one of the ‘stickiest’ entry points, creating lifelong customers for var ious gifting occasions ~$17B ANNUAL SPEND ON JEWELRY GIFTING CREATES ATTRACTIVE OPPORTUNITIES BIRTHDAY ANNIVERSARY GRADUATION RELATIONSHIP MILESTONE SPECIAL EVENT (E.G., PROM/ RELIGIOUS) REMEMBRANCE %
Slide 33: Dating Has Returned to Pre-COVID Levels
DATING HAS RETURNED TO PRE-COVID LEVELS 20 30 40 50 60 70 80 90 100 20 19 -0 1 20 19 -0 2 20 19 -0 3 20 19 -0 4 20 19 -0 5 20 19 -0 6 20 19 -0 7 20 19 -0 8 20 19 -0 9 20 19 -1 0 20 19 -1 1 20 19 -1 2 20 20 -0 1 20 20 -0 2 20 20 -0 3 20 20 -0 4 20 20 -0 5 20 20 -0 6 20 20 -0 7 20 20 -0 8 20 20 -0 9 2
Slide 34: Non-GAAP Reconciliations Tables
NON-GAAP RECONCILIATIONS TABLES (in millions) Fiscal 2020 Sales $ 6,137.1 Operating income $ 158.3 Charges related to transformation plan (1) 79.1 Asset impairments (2) 47.7 Shareholder settlements (3) 33.2 Non-GAAP operating income $ 318.3 Operating margin 2.6 % Non-GAAP operating margin 5.2 % (1)
Slide 35: Non-GAAP Reconciliations Tables (cont.)
NON-GAAP RECONCILIATIONS TABLES (cont.) As of (in millions) July 29, 2023 Adjusted debt and adjusted net debt: Current portion of long-term debt $ 147.5 Redeemable Series A Convertible Preference Shares 654.7 Adjustments: 5x Rent expense 2,232.0 Adjusted debt $ 3,034.2 Less: Cash and cash equivalent
Slide 36: Safe Harbor & Forward-Looking Statement
SAFE HARBOR & FORWARD-LOOKING STATEMENT This release contains statements which are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based upon management's beliefs and expectations as well as on assumptions made by and data c
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