Waldencast Plc · NASDAQ:WALD
Waldencast — Waldencast Acquisition — SPAC Merger (November 2021)
44 slides from Waldencast's SPAC merger presentation, Nov 15, 2021
Slide 1: Waldencast Acquisition Corp. Investor Presentation
Waldencast Acquisition Corp. Investor Presentation November 2021
Slide 2: Forward-Looking Statements
This presentation (this “Presentation”) relates to a proposed business combination (the “Business Combination”) between Waldencast Acquisition Corp. (“Waldencast”) and OBAGI Global Holdings Limited and its subsidiaries (“OBAGI”) and Milk Makeup, LLC (“Milk”). F or wa rd L oo k i ng S t a te m e n t
Slide 3: The Waldencast executive team
The Waldencast executive team We are a team deeply experienced across the beauty, wellness , and consumer goods industries, building a world - class brand development platform to identify, conceptualize, launch, and profitably scale brands Michel Brousset Founder and CEO 25+ years experience ■ Previ
Slide 4: Our ambition is to build a global beauty and wellness multi-brand platform
Our ambition is to build a global best - in - class beauty and wellness multi - brand platform by creating, acquiring, accelerating, and scaling the next generation of high - growth, purpose - driven brands.
Slide 5: The Opportunity
The Opportunity
Slide 6: Beauty is a proven and resilient, high-growth and highly profitable market
Beauty is a proven and resilient, high - growth and highly profitable market 1 Euromonitor International; Beauty & Personal Care, 2021ed, retail value sales, current prices, 2020 fixed ex rates • • • • Massive addressable market with attractive category dynamics... Global % of BPC 2021 - 2023 Key dr
Slide 7: Fragmented market with growth driven by independent brands
10% 8% 3% 4% 7% 68% New consumer trends and technology are driving an explosion of new independent brands Clear opportunity to aggregate emerging brands under a new platform to accelerate growth and scale Highly fragmented market with growth driven by independent brands ’20 market share and change (
Slide 8: Incumbents vs indies
EROSION OF TRADITIONAL SOURCES OF COMPETITIVE ADVANTAGE FOR INCUMBENTS • Large advertising budgets allocated primarily toward traditional media • Diminishing ability to dominate physical shelf space in retailers • Asset - heavy infrastructure to support in - house R&D and manufacturing facilities re
Slide 9: Incumbents vs indies and operating model
EROSION OF TRADITIONAL SOURCES OF COMPETITIVE ADVANTAGE FOR INCUMBENTS • Large advertising budgets allocated primarily toward traditional media • Diminishing ability to dominate physical shelf space in retailers • Asset - heavy infrastructure to support in - house R&D and manufacturing facilities re
Slide 10: Growth-Oriented Business Model
Growt h - Oriente d Business Model Identify and create high potential brands that we can leverage and scale through our platform Allocate capital across organic and inorganic opportunities with strong internal product and brand development capabilities B e a u t y a n d Wellnes s Pur e - Player Deep
Slide 11: Building a multi-brand platform
BRAND 3 BRAND n Following our first acquisitions, we intend to embark on a multi - year journey to build a multi - branded platform focused on the next generation of high growth, purpose - driven brands
Slide 12: Next-generation beauty and wellness platform investment criteria
We are building the next - generation beauty and wellness platform investment criteria x x x x x x x x x x x x x x x x Strong brand identity with enduring brand equity 1 2 High level of consumer affinity 3 Differentiated offering and market positioning 4 Multiple levers for long - term sustainable g
Slide 13: OBAGI
OBAGI'
Slide 14: OBAGI: best-in-class dermo-cosmetic brand
1 ‘oan Sun Shield) OBAGI Best-in-class dermo-cosmetic brand with strong anchor capabilities and attractive potential growth opportunities With a 33-year legacy of science and innovation, OBAGI created the professional skincare category and has continued to pioneer its space since launching in 1988
Slide 15: OBAGI key metrics
OBAGI $168mm 2021E net revenue! 14% 2019 - 2021E net revenue CAGR! 25% 2021E Adj. EBITDA margin’ #1 perceived best performing brand among US providers? 200+ SKUs from Rx to Consumer? 2 084GI management projections: 2021 OBAGI nani esimotesexlsv of Ching business 2°2020 Kline PysiconDapensed Skincare
Slide 16: An experienced leadership team of dermo-cosmetics experts
An experienced leadership team of dermo-cosmetics experts 8 i! Jaime Castle Lisa Errecart Trish Mentas David Bell Dr. Laurence Dryer President & CEO EVP, Global Operations VP. Finance EVP, Global Sales EVP, R&D 21+ 18+ 25+ 21+ 28+ Fea 7+ 18+ 13+ 8+ 8+ EXPERIENCE Me WYALEANT,
Slide 17: OBAGI is a leader in the fastest growing segment of skincare
OBAGI is a leader in the fastest growing segment of skincare Global skincar y 2021 N 2021 revenue $168mm4 \Euomonta tmatina: Buty & Pessoal Care, 20214, etal vl oles, ce rice, 2020 fed ex ates ncluing the United States and Conod* “How to Taga Premium Beouly Baers” repon by Key markets Middle East an
Slide 18: Market leader within professional skincare
Market leader within professional skincare LARGEST U.S. PROFESSIONAL SKINCARE PRODUCTS COMPANIES! 30+ years é BY ESTIMATED SALES (2019) of clinical cerns $130 g ‘SkinCeuticals Dermologica Skinmedica ZO Skin PCA Skin EltaMD Revision Skinbetter WOreal OBAGI (Unilever (allergen) Health [ColgotePolmave)
Slide 19: Science-backed formulations trusted and recommended by physicians worldwide
Science-backed formulations and services trusted and recommended by physicians worldwide High-performance products ...Widely recognized by physicians, with high standards of medical efficacy... driving long-standing customer relationships? 69% ELASTIderm® OBAGI360® System OBAGI-C® RX Facial Serum 88
Slide 20: Robust portfolio of highly-effective science-based products
Robust portfolio of highly-effective science-based products CORE BUSINESS GROWTH OPPORTUNITIES ws bei = : i 7 J x Transformational skincare products 5 . . . . . High-quality products designed for formulated to brighten, nourish, protect products designed for retexturizing, First professionaluse devi
Slide 21: Ambition to make OBAGI the top dermo credentialed brand
Our ambition is to make OBAGI the top dermo credentialed brand in the world, driving strong growth through channel and geographic diversification BRAND CHANNEL INTERNATIONAL WALDENCAST EXPANSION EXPANSION GROWTH PLATFORM Capitalize on medical credentials ‘and technology Deepen penetration of dermo c
Slide 22: Milk Makeup
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Slide 23: Leading clean make-up brand with a cult following among Gen-Z
23 Leading clean make - up brand with a cult following among Gen - Z consumers known for its cultural relevance and iconic products Anchored by strong community following with significant growth opportunities
Slide 24: Milk key metrics
¹ Milk financials for 2018 and management projections for 2021; 2 Sephora management; 3 Sephora website; 4 As of September 21, 2021 at 3:00 pm ET 24% 2018 – 2021E Net revenue CAGR 1 Best - Seller Face primer at Sephora 3 $47M 2021E Net revenue 1 #2 Clean Brand at Sephora US 2 Best - Seller Mascara a
Slide 25: Milk Makeup leadership team
YEARS IN S P ECI A L TY YEARS AT MILK EXPERIENCE 20+ 1+ 18+ 3+ 20+ 6+ 15+ 6+ Tim Coolican CEO Steve Nguyen CFO Mazdack Rassi Co - Founder & Chief Brand Officer Dianna Ruth Co - Founder and COO MILK MAKEUP LEADERSHIP TEAM
Slide 26: Large and exciting category with potential for growth
by 2025 $86bn 1 Color cosmetics 2021 $66bn 1 Premium color cosmetics 2021 $27bn 1 2021E revenue $47mm 4 $25 $16 $12 $5 $4 $3 Asia Pacific Western Europe Latin America Middle East and Africa Eastern Europe 202 1 colo r cosmet i c s ma r ke t s iz e ( $ b n) C A GR 202 1 - 2025 3% 11 % 10 % 5 % Key ma
Slide 27: Leading brand with exciting portfolio of cult products
LEADING BRAND WITH EXCITING PORTFOLIO OF CULT PRODUCTS AMPLE OPPORTUNITY TO INNOVATE WITHIN MAKE - UP AND SKIN AND EXPAND INTO OTHER BEAUTY CATEGORIES Innovative, iconic products Category champions with global resonance Cross - category heroes Vegan, clean, cruelty - free
Slide 28: A brand built organically on community and culture
A BRAND BUILT ORGANICALLY ON COMMUNITY AND CULTURE INCLUSIVE COMMUNITY 1 1.9M INSTAGRAM FOLLOWERS 8.5M TIKTOK LIKES 108.4K FACEBOOK FOLLOWERS VALUES ALIGNED WITH NEXT GENERATION 100% vegan Paraben - Free Pledged never to use 2,500+ controversial ingredients Packaging x Petroleum - free plan t - base
Slide 29: Growth driven by brand awareness and innovation
GROWTH DRIVEN BY BRAND AWARENESS AND INNOVATION Milk Awareness by age 1 Active + Whitespace Milk Categories 2 1 Survey conducted June 11 - 21, 2020 with female participants ages 13 - 64 who have purchased beauty products for themselves in the past 3 months and do not work in the beauty industry; 2 M
Slide 30: Established US footprint; building on partnership with Sephora
Established footprint in US with opportunity to increase presence in high - growth, international markets ¹ Data provided by Sephora; Sephora doors include Kohl’s and SiJCP 1 , 33 5 82 233 21 12 82 24 Strong position in Sephora today with room to grow Sephora Door Penetration 1 100% 1,335 100% 16% 1
Slide 31: Untapped distribution opportunities
UNTAPPED DISTRIBUTION OPPORTUNITIES Significant opportunity to expand into other beauty retail doors worldwide Note: Door counts represent expansion opportunities in brick and mortar stores Source: Retailer company websites Current Milk Presence in Brick & Mortar Expansion Opportunity ~1 ,300 of 2 ,
Slide 32: Growth levers: consumer base, internationalization, Waldencast platform
GROW CONSUMER BASE INTERNATIONALIZE WALDENCAST PLATFORM Drive awareness and trial Build global brand availability Leverage data - driven asset light Waldencast platform Reinvest operational efficiencies in increased marketing spend and leverage current ecosystem to drive awareness, trial and topli
Slide 33: Financial Overview
Financia l Overview
Slide 34: OBAGI financial profile
$104 $71 $69 $90 $60 $127 $150 $168 2018A 2019A 1 2020A 1 2021E 2022E 2023E $130 $90 $94 $117 $79 $168 $190 $213 2018A 2019A 1 2020A 1 2021E 2022E 2023E financial profile $18 $24 $7 $42 $50 $63 2018 A 3 2019 A 3 2020 A 3 2021 E 2022 E 2 2023 E 2 Adjusted EBITDA ($mm) Net sales ($mm) Gross profit ($m
Slide 35: Milk financial profile
Source: Milk financials for the periods from 2018 to 2020, management estimates for the periods from 2021E to 2023E $25 $51 $40 $47 $66 2018A 58.9% 2019A 105.3% 2020A (22.2%) 2021E 18.9% 2022E 40.4% 2023E 53.0% $11 $27 $16 $23 $39 $63 2018A 2019A 2020A 2021E 2022E 2023E Growth % Margin % 44 . 6 % 54
Slide 36: Combined financial forecast
$119 $181 $130 $215 $256 $314 $94 $130 $90 $168 $190 $213 $25 $51 $40 $47 $66 $101 2 0 20A 3 2 0 21E 2 0 22E 2 0 23E OBAGI Standalone Milk Standalone combined financial forecast 2018A Margin % Margin % Adjusted EBITDA ($mm) Net sales ($mm) Gross profit ($mm) $80 $131 $87 $150 $189 $231 $69 $104 $71
Slide 37: Transaction Overview
“= Wiransaction ' Overview
Slide 38: Transaction summary and sources and uses
transaction summary Sources and uses ($mm) Sources for equity consideration: IPO cash proceeds 6 345 PIPE Cash proceeds 3 105 Founder FPA proceeds 160 3 rd party FPA proceeds 173 Seller rollover equity 475 Total sources $1,258 Uses for equity consideration: Cash to balance sheet 202 Cash to sellers
Slide 39: Waldencast peer benchmarking
Waldencast Peer benchmarking 21% 8% 10% 8% 28% 27% 16% 22% 32% 19% 20% 25% 24% 19% 62% 14% 26% 31% 20% 28% 40% 8% 13% 15% 20% 65% 19% 23% 30% 24% 2021E - 2023E Revenue CAGR 2021 E - 2023E Adj. EBITDA CAGR 1 Pee r group average Beauty High - growth consumer Source: Historical data from company filing
Slide 40: Trading metrics for relevant peers
Beauty High - growth consumer Peer group average Trading metrics for relevant peers 4.8x 6.2x 6.7x 4.7x 29.0x 14.0x 8.3x 11.5x 15.0x 11.9x 3.9x 5.8x 6.2x 4.3x 23.2x 11.0x 7.3x 9.5x 11.3x 9.8x 25.3x 28.0x 24.2x 46.6x 96.4x 32.6x 37.4x 74.9x 45.7x 24.7x 1 23.6x 25.2x 20.5x 38.8x 61.8x 27.8x 29.7x 54.4
Slide 41: Appendix
Appendix
Slide 42: Adjusted EBITDA reconciliation
Adjusted EBITDA reconciliation $mm 2020 2019 Consolidated Carve - out Post C a r ve - out Consolidated Carve - out Post C a r ve - out Net Income / (Loss) (9.2) (2.3) (6.8) 5.8 - 5.8 Interest 6.3 - 6.3 6.8 - 6.8 Taxes (5.1) 0.0 (5.1) (1.6) - (1.6) Depreciation & Amortization 13.4 0.4 13.1 12.9 - 12.
Slide 43: Transaction detail
transaction detail ($mm) Net sales 2022E $66 EBITDA 2022E $6 Implied net sales multiple 5.8x Milk enterprise value $382 Net debt (cash) 3 (8) Equity value $390 Less: promote and fees (50) Equity value to Milk owners $340 Rollover equity to Milk owners $200 Cash proceeds to Milk owners 4 $140 ($mm) N
Slide 44: Key expansion opportunities in the US and international markets
Key expansion opportunities in the US and international markets Expand internationally first through OBAGI Medical Key strategic initiatives and then leverage OBAGI Rxto-OTC virtuous circle in each market = a ‘ aVv/+| Increase penetration and share of wallet among dermatologists Gant Growth driven b