Ermenegildo Zegna N.v. · NYSE:ZGN
Ermenegildo Zegna — Ermenegildo Zegna Holditalia — SPAC Merger (July 2021)
66 slides from Ermenegildo Zegna's SPAC merger presentation, Jul 19, 2021
Slide 1: Investor presentation July 2021
Exhibit 99.2 Investor presentation July 2021 CONFIDENTIALExhibit 99.2 Investor presentation July 2021 CONFIDENTIAL
Slide 2: The Group at a glance
A LEADING, MODERN AND INTEGRATED GROUP… ZEGNA SEGMENT THOM BROWNE SEGMENT The Group at a glance Branded Products 1 1 Branded Products 2 Other ▪ “Create something ▪ At the forefront Textile & 1% Strategic Alliances that people want, an idea, of the modern man €1.2bn THOM BROWNE. 13% commitment” Segme
Slide 3: Firmly positioned in the structurally attractive luxury market
…FIRMLY POSITIONED IN THE STRUCTURALLY ATTRACTIVE LUXURY MARKET Personal Luxury Goods Market Evolution (€bn) Key Drivers of Market Growth 1 % Global Market 15% 23% 23-26% 30-33% 380 Casualisation Digital & Direct Contact 360 295 281 250 217 China Emotions & Experientiality 76 Point of View on Future
Slide 4: Table of contents
TABLE OF CONTENTS 1. What makes Ermenegildo Zegna Group different 2. Focus on Zegna 3. The Thom Browne factor 4. Key financials overview 5. Transaction structure and valuation 3 C CO ON NF FIID DE EN NT TIIA AL LTABLE OF CONTENTS 1. What makes Ermenegildo Zegna Group different 2. Focus on Zegna 3. T
Slide 5: Our vision
OUR VISION …AND LET ME TELL YOU WHY WE WERE ALL WEARING A SUIT, AND TODAY I’M NOT… SECTION 1 4 C CO ON NF FIID DE EN NT TIIA AL LOUR VISION …AND LET ME TELL YOU WHY WE WERE ALL WEARING A SUIT, AND TODAY I’M NOT… SECTION 1 4 C CO ON NF FIID DE EN NT TIIA AL L
Slide 6: CONFIDENTIAL5
5 CONFIDENTIAL5 CONFIDENTIAL
Slide 7: Zegna FW 2021 collection
Zegna FW 2021 collection 6 CONFIDENTIALZegna FW 2021 collection 6 CONFIDENTIAL
Slide 8: Strong footprint in Greater China
Strong footprint in Greater China Shenzhen MixC Hong Kong Peking Road Hangzhou MixC 7 CONFIDENTIALStrong footprint in Greater China Shenzhen MixC Hong Kong Peking Road Hangzhou MixC 7 CONFIDENTIAL
Slide 9: Thom Browne FW 2021 collection
Thom Browne FW 2021 collection 8 CONFIDENTIALThom Browne FW 2021 collection 8 CONFIDENTIAL
Slide 10: Craftsmanship excellence
Craftsmanship excellence 9 CONFIDENTIALCraftsmanship excellence 9 CONFIDENTIAL
Slide 11: The team
THE TEAM ERMENEGILDO GIANLUCA EDOARDO RODRIGO ALESSANDRO THOM ANTONIO (GILDO) ZEGNA TAGLIABUE ZEGNA BAZAN SARTORI BROWNE GATTI IIAC Advisor Group CEO Group COO Chief Marketing, Digital and Thom Browne Zegna Thom Browne and CFO Sustainability Officer CEO Artistic Director Founder & Chief Investindust
Slide 12: What makes Ermenegildo Zegna Group different
1. What makes Ermenegildo Zegna Group different A UNIQUE OPPORTUNITY IN THE LUXURY SPACE 1. HERITAGE AND SUSTAINABILITY AT THE CORE 4. A NATURAL PLATFORM FOR GROWTH IN THE LUXURY SPACE (ZEGNA & THOM BROWNE) 2. THE MADE IN ITALY LUXURY LABORATORY PLATFORM 5. AN EXPERIENCED MANAGEMENT TEAM COMBINING F
Slide 13: Heritage and sustainability at the core
1.1 What makes Ermenegildo Zegna Group different HERITAGE AND SUSTAINABILITY AT THE CORE ACTIONS SPEAK LOUDER THAN WORDS * *Oasi Zegna will be demerged as part of the real estate business disposition that is expected to occur prior to the consummation of a potential transaction 12 C CO ON NF FIID DE
Slide 14: The Made in Italy luxury laboratory platform
1.2 What makes Ermenegildo Zegna Group different THE MADE IN ITALY LUXURY LABORATORY PLATFORM OUR UNIQUE STORY OF VERTICAL INTEGRATION FROM SHEEP TO SHOP, FROM MEN TO TERRITORY, FROM FACTORY TO PEOPLE This is the original dream of our founder, a fully integrated structure connecting animals to human
Slide 15: Our own luxury laboratory
1.2 What makes Ermenegildo Zegna Group different THE MADE IN ITALY LUXURY LABORATORY PLATFORM OUR UNIQUE STORY OF VERTICAL INTEGRATION OUR OWN LUXURY LABORATORY 1 ~250 people dedicated to R&D Serving proprietary brands ✓ Privileged procurement of finest fibres and fabrics Potential new acquisitions
Slide 16: Our key innovation initiatives
1.2 What makes Ermenegildo Zegna Group different THE MADE IN ITALY LUXURY LABORATORY PLATFORM OUR KEY INNOVATION INITIATIVES Made-to-Measure #UseTheExisting Digitalization of the garment making the dream of zero waste possible the king of services from design, to sampling and customer customization
Slide 17: A global group and pioneer in China
1.3 What makes Ermenegildo Zegna Group different A GLOBAL GROUP AND PIONEER IN CHINA 3 Zegna Group presence in Greater China Zegna brand performance in China vs. Selected Peers 1 Zegna Group 2021E Apparel & Accessories revenue split by region (€m) Brand Awareness 92% Gen Z awareness Rest of APAC 86%
Slide 18: A natural platform for growth in the luxury space
1.4 What makes Ermenegildo Zegna Group different A NATURAL PLATFORM FOR GROWTH IN THE LUXURY SPACE The benefits of the WHY THOM BROWNE? Platform: • Increase exposure to a new (Revenues, younger customer base 1 US$m) ✓ Fully-fledged • Established iconic brand “modular” luxury laboratory ~2x with stro
Slide 19: Focus on Zegna
Focus on Zegna SECTION 2 18 C CO ON NF FIID DE EN NT TIIA AL LFocus on Zegna SECTION 2 18 C CO ON NF FIID DE EN NT TIIA AL L
Slide 20: Zegna belongs to today: the (re)set
2. Focus on Zegna ZEGNA BELONGS TO TODAY THE (RE)SET FROM STATUS… …TO COMFORT May 2021 YTD Luxury 2016A 2019A 2023E Leisurewear @ 51% ZEGNA LUXURY LEISUREWEAR 38% 45% 53% 1 ZEGNA LEATHER ACCESSORIES 15% 14% 17% ZEGNA FORMALWEAR 44% 38% 27% 2 as a % of revenues At the forefront of the modern man – fr
Slide 21: Zegna belongs to today: the (re)set
2. Focus on Zegna ZEGNA BELONGS TO TODAY THE (RE)SET In order to retain its relevance, strengthen positioning and attract new customers, we believe a brand needs to… A B C …create iconic products …focus on being recognized visually …attract new customers that define you ONE BRAND ONE MESSAGE WITH RE
Slide 22: The new era: one brand
2.A Focus on Zegna ZEGNA BELONGS TO TODAY THE NEW ERA TODAY TOMORROW ONE BRAND A STRONG SINGLE BRAND, WITH A NEW SIGNIFIER EXPECTED TO BE LAUNCHED AT LISTING IN AUTUMN 2021 Source: Company information 21 21 CONFIDENTIAL2.A Focus on Zegna ZEGNA BELONGS TO TODAY THE NEW ERA TODAY TOMORROW ONE BRAND A
Slide 23: Creating icons: the Triple Stitch
2.B Focus on Zegna ZEGNA BELONGS TO TODAY CREATING ICONS The Triple Stitch: a successful iconic product delivering superior growth Triple Stitch sneakers have been extremely successful, as demonstrated by the superior growth they generated across channels despite COVID-19 Triple Stitch collection 20
Slide 24: Attracting new customers: Zegna x Fear of God
2.C Focus on Zegna ZEGNA BELONGS TO TODAY ATTRACTING NEW CUSTOMERS The ZEGNA X FEAR OF GOD collaboration - Some data points on a successful recent initiative Key KPIs Collection revenues split Best selling items 1 By region (%) REST OF APAC 10% EMEA 10% AMERICAS 18% GREATER CHINA 62% 1 By channel (%
Slide 25: The Thom Browne factor
The Thom Browne factor SECTION 3 24 CONFIDENTIALThe Thom Browne factor SECTION 3 24 CONFIDENTIAL
Slide 26: Distinctive modern luxury: the Thom Browne team
3. The Thom Browne factor DISTINCTIVE MODERN LUXURY The Thom Browne Team Sources: Company information 25 CONFIDENTIAL3. The Thom Browne factor DISTINCTIVE MODERN LUXURY The Thom Browne Team Sources: Company information 25 CONFIDENTIAL
Slide 27: Distinctive modern luxury
3. The Thom Browne factor DISTINCTIVE MODERN LUXURY Womenswear 26% 30% 38% as % of revenues ~15% CAGR ~25% 361 CAGR 271 139 Revenues 1 (US$m) Before acquisition Today Tomorrow (2018A) (2021E) (2023E) stable +~4% 2 Adj. EBIT as % of ~14% 14% 18% revenues +44 +25 3 Total retail network 32 76 101 ✓ Ful
Slide 28: Distinctive modern luxury
3. The Thom Browne factor DISTINCTIVE MODERN LUXURY A creative, thought-provoking designer with a strong tailoring aesthetic, Thom Browne is recognized for creating and establishing a new silhouette in menswear Sources: Company information 27 27 CONFIDENTIAL3. The Thom Browne factor DISTINCTIVE MODE
Slide 29: Craftmanship
3. The Thom Browne factor DISTINCTIVE MODERN LUXURY Craftmanship Sources: Company information 28 CONFIDENTIAL3. The Thom Browne factor DISTINCTIVE MODERN LUXURY Craftmanship Sources: Company information 28 CONFIDENTIAL
Slide 30: Brand awareness
3. The Thom Browne factor DISTINCTIVE MODERN LUXURY Brand awareness Cardi B Danai Gurira Maisie Williams Janelle Monàe OBJ Timothée Chalamet Pusha T Cole Sprouse Brie Larson Xiao Wen Ju Kristen Stewart Liu Wen LaKeith Stanfield Lee Pace LeBron James BTS Sources: Company information 29 CONFIDENTIAL3.
Slide 31: Distinctive modern luxury: the store
Rodrigo Bazan to review 3. The Thom Browne factor DISTINCTIVE MODERN LUXURY The store is unexpected, yet designed to feel like the interior of a home; always protected from view with either venetian blinds or a marble façade Sources: Company information 30 30 CONFIDENTIAL CONFIDENTIALRodrigo Bazan t
Slide 32: How we will grow the Thom Browne brand
Company/Rodrigo to review 3. The Thom Browne factor HOW WE WILL GROW THE THOM BROWNE BRAND Expansion Womenswear of clients Brand awareness & Accessories • Continue the successful • Pursue a very significant • Expand significantly development of our expansion of clients, brand awareness and product s
Slide 33: Key financials overview
Key financials overview SECTION 4 32 CONFIDENTIALKey financials overview SECTION 4 32 CONFIDENTIAL
Slide 34: Zegna Group's numbers at a glance
4. Key financials overview ZEGNA GROUP’S NUMBERS AT A GLANCE 2021E 2021E 1 Greater China share of Apparel & Core revenues 2 Accessories revenues €1,207m 51% (vs. 41% in 2019) 2021E 2021E 3 DTC share of Apparel & Core Adj. EBITDA 2 Accessories revenues €264m 77% (vs. 74% in 2019) 2021E 2021E 4 Core n
Slide 35: Zegna Group's key business plan growth levers
4. Key financials overview ZEGNA GROUP’S KEY BUSINESS PLAN GROWTH LEVERS Key positive Key growth levers Detail by brand market tailwinds 1 Luxury Leisurewear & Leather Accessories PRODUCT CATEGORIES Womenswear and accessories + Casualisation 2 Retail footprint optimization & digital acceleration CHA
Slide 36: Zegna Group key financials
4. Key financials overview ZEGNA GROUP KEY FINANCIALS Core revenues (€m) Core Adj. EBIT (€m) +11% (23%) +20% +11% +10% 9% 9% 2% 9% 11% 12% including Thom Browne 12 1 months contribution 1,476 173 1,342 1,271 1,306 142 1,207 1,173 116 111 1,005 1 103 17 2018A 2019A 2020A 2021E 2022E 2023E 2018A 2019A
Slide 37: Zegna Group current trading (2021 vs 2019)
4. Key financials overview ZEGNA GROUP CURRENT TRADING (2021 vs 2019) (8%) Core revenues (€m, at actual currency) 1,306 1,207 • Q1 21 at -4% vs Q1 19 • Apr-May 21 in acceleration: flat performance vs Apr-May 19 (2%) 508 497 2019A 2021A 2019A 2021E May-YTD Full Year Sources: Company information and e
Slide 38: Core revenues evolution by product category
4. Key financials overview ZEGNA GROUP (€m) CORE REVENUES EVOLUTION BY PRODUCT CATEGORY (€M) CAGR +3.1% CAGR 2019A-23E growth mostly driven by knitwear, outerwear, jersey, “new jackets” and growth mostly driven by sneakers “new trousers” 28 4 1,476 76 19 9 12 45 (14%) 54 1,306 95 180 126 +4% 18 1,20
Slide 39: Core revenues evolution by geography
4. Key financials overview ZEGNA GROUP CORE REVENUES EVOLUTION BY GEOGRAPHY ( (€ €M m)) +3.1% CAGR CAGR 2019A-23E 4 1,476 28 45 88 19 54 (14%) 44 1,306 180 60 126 +4% 18 1,207 Textile & 97 Strategic 15 (2%) 200 75 110 Alliances 151 • return to pre-COVID levels 76 206 • Americas decline vs. 2019 Whol
Slide 40: Core Adj. EBIT evolution
4. Key financials overview ZEGNA GROUP CORE ADJ. EBIT EVOLUTION From 2019A to 2020A Adj. EBIT From 2020A to 2021E Adj. EBIT From 2021E to 2023E Adj. EBIT Dec-YE COVID-19 Breakup Recovery Phase Expansion Phase 2019A 2020A 2021E Starting Core Adj. EBIT 9% 2% 9% €116m €17m €111m ∆ revenues ~(€300m) ~+€
Slide 41: Focus on Zegna segment key financials
4. Key financials overview 1 FOCUS ON ZEGNA SEGMENT KEY FINANCIALS Core revenues (€m) Core Adj. EBIT (€m) (0%) (28%) +18% +10% +9% 9% 8% n.m. 8% 9% 10% 119 1,179 1,153 1,150 1,082 985 99 96 94 834 80 (10) 2018A 2019A 2020A 2021E 2022E 2023E 2018A 2019A 2020A 2021E 2022E 2023E 2 x% Core revenues y-o-
Slide 42: Focus on Thom Browne segment key financials
4. Key financials overview FOCUS ON THOM BROWNE SEGMENT KEY FINANCIALS Revenues (€m) Adj. EBIT (€m) 1 +37% +12% +28% +17% +14% n.m. 14% 15% 14% 17% 18% 306 268 55 230 46 including Thom Browne 2 12 months contribution 180 161 31 117 27 • 22 Thom Browne consolidated since 30-Nov-18 19 2 19 n.m. 2018A
Slide 43: Transaction structure and valuation
Transaction structure and valuation SECTION 5 42 CONFIDENTIALTransaction structure and valuation SECTION 5 42 CONFIDENTIAL
Slide 44: Transaction structure
5. Transaction structure and valuation TRANSACTION STRUCTURE Sources & Uses Key Transaction Highlights Sources ($m) Uses ($m) Headline Valuation Existing Shareholders Rollover Equity 1,554 Existing Shareholders Rollover Equity 1,554 $3,171m 18.0x 2 3 Core Enterprise Value 2022E Adj. EBIT Multiple 4
Slide 45: Operational benchmarking
5. Transaction structure and valuation Luxury Conglomerates Luxury Players OPERATIONAL BENCHMARKING : 9.4% : 15.3% 14.3% 2 11.1% 10.6% 10.1% 9.8% 9.6% 8.7% 8.6% 8.3% 3 11 23 29 9 15 12 29 18 2 : 21.7% : 32.2% 67.3% 36.8% 3 25.8% 24.7% 18.6% 13.6% 13.5% 13.1% 1 nm Source: IBES and Refinitiv Eikon as
Slide 46: Compelling valuation for investors
5. Transaction structure and valuation Luxury Conglomerates Luxury Players COMPELLING VALUATION FOR INVESTORS EV / EBIT 44.8x 37.2x 34.4x 24.3x 24.1x 1 19.4x 18.6x 18.0x nm 39.4x 29.0x 25.3x 21.7x 21.0x 17.6x 16.7x 1 14.7x nm Source: IBES and Refinitiv Eikon as of 25-Jun-21, company public informati
Slide 47: Thank you
THANK YOU 46 CONFIDENTIALTHANK YOU 46 CONFIDENTIAL
Slide 48: Appendix
Appendix 47 CONFIDENTIALAppendix 47 CONFIDENTIAL
Slide 49: Zegna Group's key financials
ZEGNA GROUP’S KEY FINANCIALS (€m) 2021E 2021E 2021E 2021E 2021E 2021E 3 1 Greater China share of Apparel DTC share of Apparel & Core revenues Core Adj. EBITDA Core Adj. EBIT Core net financial 2 2 4 & Accessories revenues Accessories revenues indebtedness €1,207m €264m €111m €84m 51% 77% (vs. 41% in
Slide 50: Core revenues evolution by channel
ZEGNA GROUP (€m) CORE REVENUES EVOLUTION BY CHANNEL (€M) +3.1% CAGR CAGR 2019A-23E 28 4 1,476 74 19 164 54 (14%) 1,306 180 126 +4% Textile & 18 1,207 driven by Thom Browne Wholesale growth and Zegna recovery Strategic 97 (close to 2019 levels); Travel Retail as a key factor in APAC 15 Alliances 75 1
Slide 51: Zegna Group core net financial indebtedness
ZEGNA GROUP 1 CORE NET FINANCIAL INDEBTEDNESS • including €11m impact from 2 acquisitions announced in 2021 • total impact of one-off cash outflows of €92m includes impact of one-off cash outflows such as: €43m purchase price 84 and related charges for the acquisition of 50% of the New Bond Street (
Slide 52: Core Adj. operating cash flow
ZEGNA GROUP 1 CORE ADJ. OPERATING CASH FLOW (MANAGEMENT ESTIMATES) 62 54 (28) 2018A 2019A 2020A Core net cash from 245 240 113 2 operating activities Core operating capex (57) (57) (33) Core payment of lease liabilities (126) (129) (107) Source: Company information and estimates Notes: See Glossary
Slide 53: Glossary
GLOSSARY METRIC DEFINITION The “core” measures included in this presentation are unaudited. Such measures exclude certain businesses of the Company that are expected to be divested (by way of one or more demergers or other transfers) prior to the consummation of the Transaction (such divestitures, c
Slide 54: Summary non-IFRS core financials (1/2)
SUMMARY NON-IFRS CORE FINANCIALS (1/2) Key income statement items (€m) 1 €m 2018A 2019A 2020A 2021E 2022E 2023E Zegna Segment core revenues 1,153 1,150 834 985 1,082 1,179 Thom Browne Segment revenues 19 161 180 230 268 306 Eliminations between Segments (0) (6) (8) (8) (8) (9) Core revenues 1,173 1,
Slide 55: Summary non-IFRS core financials (2/2)
SUMMARY NON-IFRS CORE FINANCIALS (2/2) Key balance sheet and cash flow items (€m) €m 2018A 2019A 2020A 1 Core Net Financial Indebtedness 10 18 32 Core IFRS16 lease liabilities 556 546 443 301 308 320 Core inventories Core trade receivables 164 178 140 Core trade liabilities including customer advanc
Slide 56: IFRS reconciliations (1/6)
IFRS RECONCILIATIONS (1/6) Core revenues reconciliation (€m) €m 2018A 2019A 2020A Zegna Segment Core revenues 1,153 1,150 834 Thom Browne Segment revenues 19 161 180 Eliminations between Segments (0) (6) (8) Core revenues 1,173 1,306 1,005 10 16 10 Disposition reversal Revenues (IFRS) 1,183 1,321 1,
Slide 57: IFRS reconciliations (2/6)
IFRS RECONCILIATIONS (2/6) Core Adj. EBIT reconciliation (€m) €m 2018A 2019A 2020A Zegna Segment Core Adj. EBIT 99 94 (10) Thom Browne Segment Adj. EBIT 4 22 27 103 116 17 Core Adj. EBIT Disposition reversal (3) (5) (4) Adj. EBIT 100 111 13 1 Adjustments / Reconciling Items (9) (14) (41) Operating p
Slide 58: IFRS reconciliations (3/6)
IFRS RECONCILIATIONS (3/6) Core Adj. EBITDA reconciliation (€m) €m 2018A 2019A 2020A Core Adj. EBITDA 261 287 188 Disposition reversal (2) (7) (7) Adj. EBITDA 259 280 181 Depreciation and amortization (159) (170) (168) 1 Adjustments / Reconciling Items (9) (14) (41) Operating profit (IFRS) 91 97 (28
Slide 59: IFRS reconciliations (4/6)
IFRS RECONCILIATIONS (4/6) Key balance sheet items reconciliation (€m) €m 2018A 2019A 2020A 1 Core Net Financial Indebtedness 10 18 32 Disposition reversal (29) (30) (26) Net Financial Indebtedness (20) (12) 6 556 546 443 Core IFRS16 lease liabilities Disposition reversal (8) (38) (35) IFRS16 lease
Slide 60: IFRS reconciliations (5/6)
IFRS RECONCILIATIONS (5/6) Key balance sheet items reconciliation – focus on Core Net Financial Indebtedness (€m) €m 2018A 2019A 2020A Non current financial borrowings 635 514 559 Current financial borrowings 131 106 91 Derivative financial instruments 9 12 12 Other non current financial liabilities
Slide 61: IFRS reconciliations (6/6)
IFRS RECONCILIATIONS (6/6) Key cash flow items reconciliation (€m) €m 2018A 2019A 2020A Net cash provided by operating activities 203 205 70 Cash-out of financial interest add-back 4 5 4 Cash-out of income taxes add-back 28 23 31 Net cash provided by operating activities, excluding cash out for inco
Slide 62: DOS network evolution
DOS NETWORK EVOLUTION 1 2 2 Zegna Branded Products (# DOS ) Thom Browne (# DOS ) at year end at year end 6 (1) 7 244 [ ] (6) 238 5 68 3 46 39 3 9 19 9 65 71 38 16 4 45 46 6 13 34 88 82 15 2020A Greater Rest of EMEA Americas 2023E 2020A Greater Rest of EMEA Americas 2023E China APAC China APAC Greate
Slide 63: Investindustrial Acquisition Corp. overview
INVESTINDUSTRIAL ACQUISITION CORP. OVERVIEW Team Overview Investindustrial Overview Investindustrial Acquisition Corp. Leadership Advisory Board European leader with strong presence in Southern Europe • Founded in 1990 with backing from an industrial conglomerate, active since the late 20th century
Slide 64: Risk factors
RISK FACTORS All references to Zegna refer to the business of Ermenegildo Zegna Holditalia S.p.A. and its consolidated subsidiaries. The risks presented below are certain of the general risks related to the business of Zegna and to the contemplated business combination and such list is not exhaustiv
Slide 65: Disclaimer (1/2)
DISCLAIMER (1/2) Confidentiality and Disclosures This presentation (the “Presentation”) is provided for information purposes only and has been prepared in connection with a possible business combination (a “Transaction”) involving Ermenegildo Zegna Holditalia S.p.A. (the “Company”) and a special pur
Slide 66: Disclaimer (2/2)
DISCLAIMER (2/2) Non IFRS Financial Measures The document includes certain non-IFRS financial measures (including on a forward-looking basis), such as Adjusted EBIT, Adjusted EBITDA, Net Financial Indebtedness, Operating Capex and Adjusted Operating Cash Flow.These non-IFRS measures are an addition,
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