Slide 1: 1Q19 Financial Results
1Q19 FINANCIAL RESULTS November 7, 2018
Slide 2: 1Q19 Financial Highlights
1Q19 FINANCIAL HIGHLIGHTS A CHALLENGING QUARTER REFLECTING IMPACT OF DISRUPTION • 1Q19 Net Revenue LFL (7.7%), or ~(2.5%) when ~2,137 excluding temporary external and internal $1,150M (+150M) supply chain disruptions related to: -90 Supply chain footprint consolidation LFL (7.7%) Underlying ~(2.5%
Slide 3: Overview of Temporary Q1 Supply Headwinds
OVERVIEW OF TEMPORARY Q1 SUPPLY HEADWINDS Internal Supply Chain External Supply Disruption – Consolidation – ~1/3 of Impact ~2/3 of Impact • European planning hub • Certain component • U.S. Hurricane Florence • European warehouse shortages (pumps and impacting North Issue • U.S. warehouse glass bott
Slide 4: 1Q19 Results Mask Underlying Performance
1Q19 RESULTS MASK UNDERLYING PERFORMANCE STRONG CONSUMER DEMAND IN 2 DIVISIONS • Supply chain headwinds are a temporary setback in achieving our financial targets • We continue to see strong underlying consumer demand in Luxury and Professional Beauty • Consumer Beauty results not where they should
Slide 5: Earnings Model to Reach High Teen Adjusted Operating Margin
EARNINGS MODEL TO REACH HIGH TEEN ADJUSTED OPERATING MARGIN UNDERPINS OUR STRATEGIC CHOICES Sustain above-market top line expansion through strong Luxury innovation capabilities, geographic expansion & development of Top line growth prestige skincare and colour cosmetics offering Professional Accele
Slide 6: Luxury 1Q19 Results
LUXURY 1Q19 RESULTS • 1Q19 Net Revenue LFL (2.1%), or up ~5% when excluding ~844 temporary external and internal supply chain $1,150M (+150M) disruptions • Adjusted operating income of -90 $102M (+13% YoY), reaching LFL Underlying 12.8% adjusted operating (2.1%) +~5% margin • Share gains in core bra
Slide 7: Luxury Highlights
LUXURY HIGHLIGHTS 7
Slide 8: Professional Beauty 1Q19 Results
PROFESSIONAL BEAUTY 1Q19 RESULTS • 1Q19 Net Revenue LFL (2.6%), or up ~1.5% when excluding temporary supply chain headwinds ~426 • Adjusted operating income of -90 $1,150M $24M (+41% YoY), with (+150M) adjusted operating margin of 5.8% LFL Underlying (2.6%) + ~1.5% • Continued growth of Coty’s large
Slide 9: Professional Beauty Highlights
PROFESSIONAL BEAUTY HIGHLIGHTS WELCOME TO WELLASTORE 9
Slide 10: Consumer Beauty 1Q19 Results
CONSUMER BEAUTY 1Q19 RESULTS • 1Q19 Net Revenue LFL (14.0%), or down ~(9%) when excluding temporary headwinds ~867 $1,150M • Adjusted operating income of $15M -90 (+150M) (-83% YoY) • Strong growth in Brazil and Middle LFL Underlying East & Africa (14.0%) ~ (9%) • Strong innovation performance in We
Slide 11: Consumer Beauty Highlights
CONSUMER BEAUTY HIGHLIGHTS 11
Slide 12: Consumer Beauty Turnaround Plan
CONSUMER BEAUTY TURNAROUND PLAN Critical First Steps – FY19 Actions – Strengthening Operational Strategic Changes Discipline Restoring service levels Refocusing investment to higher-potential businesses Innovation focus and Continued fixed cost savings execution Greater discipline in trade Investmen
Slide 13: Net Debt Increase in 1Q19 Largely Tied to Supply Chain Disruption
NET DEBT INCREASE IN 1Q19 LARGELY TIED TO SUPPLY CHAIN DISRUPTION • Net Debt increased by $370M in 1Q19, resulting in Net Debt / Adj. EBITDA ratio of 5.8x $ Millions 7,661 • Supply chain disruptions had significant repercussions on working capital, driving poor Free Cash Flow result in 1Q19 $1,150M
Slide 14: Outlook
OUTLOOK 2Q19 FY19 • Continue to expect operating profit and margin growth, • Expect an improved LFL trend vs. 1Q19, across all driven by significant progress in fixed cost reductions and three divisions, inclusive of expected supply chain synergy delivery headwinds • Maintain synergies commitment of
Slide 15: 1Q19: Key Take-Aways
1Q19: KEY TAKE-AWAYS • 1Q19 was a setback in achieving our financial targets and bold strategic goals, driven by our temporary supply chain headwinds • We remain absolutely convinced that the fast paced and ambitious transformational agenda we are pursuing is ultimately building a much stronger Coty
Slide 16: Disclaimer
DISCLAIMER Forward-Looking Statements Certain statements in this presentation are forward-looking statements. These forward-looking statements reflect Coty Inc.’s (“Coty’s”) current views with respect to, among other things, Coty’s targets and outlook for future reporting periods (including the exte
Slide 17: Appendix
APPENDIX COTY
Slide 18: Reconciliation of Reported to LFL and Underlying NR & Reported to Adjusted Operating Income
RECONCILIATION OF REPORTED TO LFL AND UNDERLYING NR & REPORTED TO ADJUSTED OPERATING INCOME 1Q FY19 Net Revenue Change YoY QTD New Revenue Foreign Impact from Supply Chain Recognition Reported Basis Exchange Acquisitions Organic LFL NR Disruptions Hurricane Impact Guidance Underlying NR Coty Inc. (9