Slide 1: Investor Presentation
INVESTOR PRESENTATION February 16, 2022
Slide 2: Forward-Looking Statement
This document includes estimates, projections, and statements relating to our plans, commitments, objectives, and expectations that are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E
Slide 3: Content
• Our Vision & Values • 2021 Update CONTENT • Crocs Growth Framework • HEYDUDE Acquisition Update • Financial Results & Outlook • Appendix 3
Slide 4: Our Vision: Everyone comfortable in their own shoes
OUR VISION Everyone comfortable in their own shoes 4
Slide 5: Our Values: The Path We Choose to Walk
OUR VALUES The Path We Choose to Walk INHERENT DELIGHTFULLY PEOPLE-PURPOSED SIMPLICITY DEMOCRATIC DESIGN We know smart doesn’t have to We celebrate one-of-a-kinds We think people-first at every mean complicated. So we keep and stand together with all step. We design for everything things simple, lig
Slide 6: Quarterly Highlights
“ QUARTERLY HIGHLIGHTS A strong 2021 holiday season completed a very successful year for our brand. We achieved incredible results with record revenues of $2.3 billion, 67% revenue growth and industry-leading 30% operating margin. Our fourth straight year of revenue growth was fueled by continued st
Slide 7: 2021 Company Highlights
HIGHLIGHTS 2021 Company Highlights • Revenues of $2.3B, +67% and +88% vs. PY and 2019, respectively • 3rd consecutive year of double-digit growth • Digital sales +48% and +122% vs. PY and 2019, respectively ◦ Represented 37% of 2021 sales vs. 42% and 31% in 2020 and 2019, respectively • Best in clas
Slide 8: 2021 Update
crocs 2021 Update
Slide 9: Exceptional Revenue Growth and Adjusted Operating Margin
2021 UPDATE Exceptional Revenue Growth and Adjusted Operating Margin 2018 2019 2020 2021 YoY Growth +6.3% +13.1% +12.6% +66.9% Adj. Op Margin 7.7% 11.6% 18.9% 30.1% 9 Note: Revenue in USD millions. See reconciliation to GAAP equivalent in Appendix
Slide 10: Q4 Highlights
2021 UPDATE Q4 Highlights • Revenues of $587M, +43% vs. PY ◦ Americas +51% vs. PY ◦ EMEA +23% vs. PY ◦ Asia Pacific +10% vs. PY ◦ DTC +45% vs. PY and 54% of revenues ◦ WHL +40% vs. PY and 46% of revenues • Digital sales grew 41% to represent 40% of revenues • Adjusted income from operations rose $81
Slide 11: Exceptional Fourth Quarter Results
2021 UPDATE Exceptional Fourth Quarter Results '21 vs. '20 +43% +770bps +750bps +103% '21 vs. '19 +123% +1,440bps +2,370bps +1,692% (1) (1) (1) Q4 2019 Q4 2020 Q4 2021 * Note: USD millions for Revenue. Revenue growth is on a reported basis. 11 (1) See reconciliations to GAAP equivalents in Appendix.
Slide 12: Crocs Growth Framework
CROCS GROWTH FRAMEWORK PRODUCT & DIGITAL SANDALS ASIA MARKETING INNOVATION 12
Slide 13: Expect Digital Sales to be $2.5B+ by 2026
CROCS GROWTH FRAMEWORK Expect Digital Sales to be $2.5B+ by 2026 Q4 Digital commerce growth of 41% vs. PY and 163% vs 2019 Q4 Digital sales represented 40% of total revenues Q4 Digital Penetration* Q4 2019 Q4 2020 Q4 2021 * Chart reflects percentage of Q4 2021 sales. Digital sales defined as sum of
Slide 14: Targeting 4X Sandals Revenue Growth by 2026
CROCS GROWTH FRAMEWORK Targeting 4X Sandals Revenue Growth by 2026 • Fragmented $30B casual market with no clear leader • Drive awareness through marketing • Convert existing customers and provide an additional gateway to our brand • Year-round digital opportunity • Win across 4 key sub-categories:
Slide 15: Largest Long-Term Growth Opportunity in Asia
CROCS GROWTH FRAMEWORK Largest Long-Term Growth Opportunity in Asia Asia: greatest opportunity long-term • China is the 2nd largest footwear market in the world • Strong digital growth supported by participation on key marketplace platforms • Developing local-for-local production, marketing and coll
Slide 16: Marketing Innovation Fueling Brand Strength Globally
CROCS GROWTH FRAMEWORK Marketing Innovation Fueling Brand Strength Globally User Generated Content* GLOBALLY LED Collabs & Partnerships LOCALLY RELEVANT * Source: Instagram & Tik Tok 16 16
Slide 17: Acquisition Update
Acquisition Update 17
Slide 18: HEYDUDE Acquisition Update
HEYDUDE ACQUISITION UPDATE HEYDUDE Acquisition Update • Expect to close acquisition in February 2022 • Advanced in building out our HEYDUDE leadership team with the majority of critical positions filled • Financing ◦ Secured $2B of Term Loan B commitments ◦ Issuing 2,852,280 shares to one of the sel
Slide 19: Strategic Rationale
HEYDUDE ACQUISITION UPDATE Strategic Rationale • Creates a global, scaled leader in branded casual footwear • Combines two fast-growing footwear brands and more than quadruples total addressable market to more than $160B* • Diversifies product portfolio from single-brand to multi-brand • Builds upon
Slide 20: Building HEYDUDE to $1B+ by 2024
HEYDUDE ACQUISITION UPDATE Building HEYDUDE to $1B+ by 2024 • Invest in industry-leading marketing to build brand awareness • Enhance digital capabilities to further accelerate digital • Leverage Crocs strong wholesale relationships to enhance distribution • Leverage Crocs distribution for global gr
Slide 21: Significant Value Creation From Both Brands
HEYDUDE ACQUISITION UPDATE Significant Value Creation From Both Brands High Revenue Industry Leading Exceptional Cash Growth Profitability Flow Generation 21
Slide 22: Financial Results
Financial Results 22
Slide 23: Q4 Financial Results
FINANCIAL RESULTS Q4 Financial Results Q4 vs. PY Revenues ($M) $586.6 44%* Gross Margin 63.4% +770 bp Adjusted Gross Margin** 63.7% +770 bp Adjusted SG&A as % of 35.1% (20) bp Revenue** Operating Margin 27.3% +1,160 bp Adjusted Operating Margin** 28.6% +750 bp Diluted EPS $2.57 (4)% Adjusted Diluted
Slide 24: 2021 Financial Results
FINANCIAL RESULTS 2021 Financial Results 2021 vs. PY Revenues ($M) $2,313.4 +65%* Gross Margin 61.4% +730 bp Adjusted Gross Margin** 61.6% +700 bp Adjusted SG&A as % of 31.6% +400 bp Revenue** Operating Margin 29.5% +1,410 bp Adjusted Operating Margin** 30.1% +1,120 bp Diluted EPS $11.39 +150% Adjus
Slide 25: 2022E Outlook
2022E Outlook 25
Slide 26: 2022E Guidance
2022E OUTLOOK 2022E Guidance Q1 22E FY 22E Reported Revenues $605 to $630M ~$3.4B $520 to $535M 20%+ $40M+ demand pushed to Q2(1) . (2) $85 to $95M $620 to $670M(2) Adjusted Operating Margin ~22%(3) ~26%(4) Adjusted One Time Costs ~$70M(5) ~$135M(6) Adjusted Tax Rate ~22% Adjusted Diluted EPS $9.70
Slide 27: Long Term Guidance
2022E OUTLOOK Long Term Guidance* Crocs, Inc. Revenues $5B+ $1B+ $6B+ Revenue Growth 17%+ 20%+ Adjusted Operating Margin 26%+ 26%+ 26%+ Adjusted Tax Rate ~25% Capital Expenditures ~3% of revenues * Crocs long-term guidance provided here is on a pre-acquisition standalone basis. Long term for Crocs a
Slide 28: Significant Cash Flow Generation Fuels Rapid Debt Repayment
2022E OUTLOOK Significant Cash Flow Generation Fuels Rapid Debt Repayment Net Debt / Adjusted EBITDA • Finished 2021 with net leverage <1x 2.9x • Secured $2B of Term Loan B commitments to finance a portion of the HEYDUDE Acquisition ≤ 2.0x • Committed to working towards quickly deleveraging 0.8x • S
Slide 29: Appendix
Appendix 29
Slide 30: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION Non-GAAP cost of sales, gross profit, and gross margin reconciliation: Year Ended Three Months Ended December 31, 2021 December 31, 2021 2020 2021 2020 (in thousands) GAAP revenues $ 586,626 $ 411,506 $ 2,313,416 $ 1,385,951 GAAP cost of sales $ 214,602 $ 182,422 $ 893,196 $
Slide 31: Non-GAAP Reconciliation (cont'd)
NON-GAAP RECONCILIATION (cont’d) Non-GAAP selling, general and administrative expenses reconciliation: Three Months Ended December Year Ended 31, 2021 December 31, 2021 2020 2021 2020 (in thousands) GAAP revenues $ 586,626 $ 411,506 $ 2,313,416 $ 1,385,951 GAAP selling, general and administrative ex
Slide 32: Non-GAAP Reconciliation (cont'd)
NON-GAAP RECONCILIATION (cont’d) Non-GAAP income from operations and operating margin reconciliation: Three Months Ended Year Ended December 31, December 31, 2021 2020 2021 2020 (in thousands) GAAP revenues $ 586,626 $ 411,506 $ 2,313,416 $ 1,385,951 GAAP income from operations $ 159,988 $ 64,631 $
Slide 33: Non-GAAP Reconciliation (cont'd)
NON-GAAP RECONCILIATION (cont’d) Non-GAAP income tax expense (benefit) and effective tax rate reconciliation: Year Ended Three Months Ended December 31, December 31, 2021 2020 2021 2020 (in thousands) GAAP income from operations $ 159,988 $ 64,631 $ 683,064 $ 214,124 GAAP income before income taxes
Slide 34: Non-GAAP Reconciliation (cont'd)
NON-GAAP RECONCILIATION (cont’d) Non-GAAP earnings per share reconciliation: Year Ended Three Months Ended December 31, December 31, 2021 2020 2021 2020 (in thousands, except per share data) Numerator: GAAP net income $ 154,853 $ 183,330 $ 725,694 $ 312,861 Non-GAAP cost of sales adjustments (1) 1,7
Slide 35: Reconciliation of GAAP to Non-GAAP Financial Guidance
NON-GAAP RECONCILIATION (cont’d) RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL GUIDANCE First Quarter 2022: Approximately: Non-GAAP operating margin reconciliation: GAAP operating margin 10% Non-GAAP adjustments, primarily associated with the HEYDUDE acquisition (1) 12% Non-GAAP operating margin 22%
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