Lifetime Brands, Inc. · NASDAQ:LCUT
Lifetime Brands — Investor Presentation (March 2018)
33 slides from Lifetime Brands's investor presentation, Mar 29, 2018
Slide 1: A Transformation
A Transformation NASDAQ: LCUT www.LifetimeBrands.com March 2018 Exhibit 99.1
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements, including statements concerning Lifetime’s future prospects that represent the Company’s current judgment about possible future events. The Company believes these judgments are reasonable, but these statements are not
Slide 3: Lifetime Brands, Inc.
LIFETIME BRANDS, INC. Lifetime Brands is one of the world’s leading designers, developers, and marketers of a broad range of nationally branded consumer products used in the home.
Slide 4: Lifetime is now the #1 North American non-electric housewares company
LIFETIME IS NOW THE #1 NORTH AMERICAN NON-ELECTRIC HOUSEWARES COMPANY Recent acquisition solidifies leadership position in housewares. Source: Euromonitor Retail Sales Data for North America CY2016 Housewares industry, including cooking utensils, dishes, tableware, cutlery, drinkware, and other smal
Slide 5: Acquisition of Filament created critical mass
Enhanced business along multiple operational and financial dimensions. Net Sales: $579 million $757 million(1) EBITDA: $40 million $83 million(2) Leading Brands: 5 8 Product Segments Served: 22 27 #1 Positions 5 9 Operational Efficiencies: Improving Enhanced Free Cash Flow: Strong Stronger Transacti
Slide 6: #1 Kitchen Tools & Gadgets Supplier in the U.S.
#1 KITCHEN TOOLS & GADGETS SUPPLIER IN THE U.S.
Slide 7: #1 Cutlery Supplier in the U.S.
#1 CUTLERY SUPPLIER IN THE U.S.
Slide 8: #1 Wine/Bar Accessory Supplier in the U.S.
#1 WINE/BAR ACCESSORY SUPPLIER IN THE U.S.
Slide 9: #1 Kitchen Measurement Supplier in the U.S.
#1 KITCHEN MEASUREMENT SUPPLIER IN THE U.S.
Slide 10: #1 Bath Measurement/Scale Supplier in the U.S.
#1 BATH MEASUREMENT/SCALE SUPPLIER IN THE U.S.
Slide 11: #1 Tea Kettle Brand in the U.S.
#1 TEA KETTLE BRAND IN THE U.S.
Slide 12: Leading Tabletop Supplier in the U.S.
LEADING TABLETOP SUPPLIER IN THE U.S.
Slide 13: Owned & Controlled Brands
OWNED & CONTROLLED BRANDS Lifetime Brands focuses on owned brands that provide flexibility domestically and can be marketed internationally. Our strong brand portfolio features leading brands that resonate with consumers.
Slide 14: Key Licensed Brands & Private Label
KEY LICENSED BRANDS & PRIVATE LABEL The company supports licensed and private label brands by leveraging product development and sourcing expertise. Lifetime helps retailers develop their own brands while minimizing their start-up costs Lifetime supports retailers with market analysis, product assor
Slide 15: Attractive Product Category Mix
Sales by Product Category ATTRACTIVE PRODUCT CATEGORY MIX Diverse portfolio and customer base position company to capitalize on U.S. demographic trends. Home Solutions 7% Kitchenware 53% Tableware 24% Lifetime has the right product mix to reach the full spectrum of consumers at the top retailers. Ba
Slide 16: Customer Diversification
Mass Market Retailers Off-Price Retailers Department Stores Specialty Stores Warehouse Clubs Online/TV Supermarkets Independent Retailers Commercial Retail Direct CUSTOMER DIVERSIFICATION Lifetime Brands sells to every major U.S. retailer that carries housewares. Over 7,000 independent retailers Lif
Slide 17: Innovation
INNOVATION Our focus is on identifying and investing in major consumer trends, new technologies, materials and designs. Over 120 professionals in the U.S., China, and the U.K. Over 1,000 design and utility patents Open Innovation program connects us with thousands of independent inventors Recent acq
Slide 18: Expanding Our Global Reach
EXPANDING OUR GLOBAL REACH In attractive markets, Lifetime has partnered with strong local business in which the Company has minority investments. Total Sales of Lifetime Brands and Our Partners (In Millions): Year ended December 31, 2017: $952.7 (1) Lifetime Brands, Inc. $579.5 Grupo Vasconia $167.
Slide 19: International Growth
INTERNATIONAL GROWTH Focus on expanding business where we see the opportunity to grow at a faster rate than in the U.S. 2011: Acquired Creative Tops in UK 2014: Expanded U.K. and continental Europe market via acquisitions of Kitchen Craft and La Cafetière 2014: Commenced sales into China and opened
Slide 20: International Customer Base
INTERNATIONAL CUSTOMER BASE Lifetime Brands sells to major international retailers that carry housewares. Garden Center Groups Supermarkets Online/TV Specialty Retailers Department Stores Discount Retailers Lifetime’s products are available in 117 countries.
Slide 21: Leading Housewares Consolidation Platform
LEADING HOUSEWARES CONSOLIDATION PLATFORM Substantial collective experience identifying and executing acquisitions. 2013 2014 2017 2014 2016 2016 2014 2012 2014 2014 2016 2012 2013 2017 14 transactions Proven integration capabilities and repeatable M&A strategy.
Slide 22: Leverage Infrastructure
LEVERAGE INFRASTRUCTURE Leverage economies of scale and relationships in sourcing and distribution to drive internal efficiencies and provide new services to retailers. Sourcing products in Far East for 50 years Network of several hundred suppliers Long-term relationships with key vendors Four offsh
Slide 23: Lifetime Next
LIFETIME NEXT™ An initiative to accelerate growth by realigning operating divisions, eliminating complexity and reducing SG&A. Phase I (Complete) Assessed opportunities to increase efficiencies to drive growth in revenues, gross margin, operating profit, and cash flow Phase II (Complete) Designed sp
Slide 24: Filament Integration Update
FILAMENT INTEGRATION UPDATE $8 million of identified synergy opportunities. Cost savings to be predominantly implemented in 2018 with the full benefit realized by 2019. Synergy Analysis Summary
Slide 25: Growth Drivers
GROWTH DRIVERS Breadth of offerings, increased efficiencies, and recent acquisitions position the company for future growth. Organic growth; Potential for continued acquisitions; Profitability improvements from Lifetime Next™ and Filament Brands synergies; Impact of combining Creative Tops and Kitch
Slide 26: The New Lifetime Brands
THE NEW LIFETIME BRANDS The transformational acquisition of Filament Brands enhances both margins and cash flow. Meaningfully Accretive +2x +400 bps +30% Net Sales EBITDA EBITDA Margin $757 $83 11% EPS Milestone on the road to surpassing $100 million in EBITDA. (1) Year ended December 31, 2017 total
Slide 27: Recent Financial Performance
RECENT FINANCIAL PERFORMANCE
Slide 28: Summary of Operating Results
SUMMARY OF OPERATING RESULTS (1) Adjusted diluted income per common share represents a non-GAAP financial measure. This non-GAAP measure is provided because management of the Company uses this financial measure in evaluating the Company's on-going financial results and trends. Management uses this n
Slide 29: Operations – Adjusted Basis
OPERATIONS – ADJUSTED BASIS (1) Adjusted net income and adjusted diluted income per common share represent non-GAAP financial measures. These non-GAAP measures are provided because management of the Company uses these financial measures in evaluating the Company's on-going financial results and tren
Slide 30: Balance Sheet Summary
BALANCE SHEET SUMMARY (1) The pro forma combined balance sheet summary is intended to reflect the impact of the Filament acquisition as if it had occurred on December 31, 2017, after giving effect to the assumptions and adjustments as described in the unaudited pro forma condensed combined financial
Slide 31: Credit Profile
CREDIT PROFILE LTM Pro Forma EBITDA is calculated as Lifetime Brands adjusted EBITDA for the year ended December 31, 2017, Filament calendarized FY 2017 estimated EBITDA of $34.5 million and $8.1 million of identified synergy opportunities. (2) Financing obtained on March 2, 2018 in connection with
Slide 32: Commitment to Rapid Deleveraging
COMMITMENT TO RAPID DELEVERAGING Expect to reduce net leverage to 3.0x or below within two years. Successful pricing of financing to execute transaction Asset light model results in high levels of cash flow generation High Free Cash Flow conversion expected to drive rapid deleveraging Expect to main
Slide 33: Investment Highlights
INVESTMENT HIGHLIGHTS Broad Portfolio of Leading Brands and Diversified Customer Base An unmatched portfolio of leading owned, licensed, and private label brands across kitchenware, tableware and other home products Diversified retail customer base includes full spectrum of housewares retailers and