Crocs, Inc. · NASDAQ:CROX
Crocs — Q3 2024 Earnings Presentation
31 slides from Crocs's earnings presentation, Oct 29, 2024
Slide 1: Q3 2024 Investor Presentation
Q3 2024 Investor Presentation
Slide 2: Forward Looking Statement
Forward Looking Statement This document includes estimates, projections, and statements relating to our business plans, commitments, objectives, and expected operating results that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27
Slide 3: Contents
Contents • Company Highlights • Financial Review • Appendix
Slide 4: Company Highlights
Company Highlights 4
Slide 5: Q3 2024 Highlights
Q3 2024 HIGHLIGHTS Q3 2024 Highlights (1) • Revenues of $1,062M, +2% (1) ◦ Crocs Brand revenues of $858M, +8% (1) ▪ North America revenues +2% (1) ▪ International revenues +17% (1) (1) ▪ DTC +8% and WHL +8% ◦ HEYDUDE Brand revenues of $204M, (17)% ▪ DTC (9)% and WHL (23)% (2) • Adjusted operating ma
Slide 6: Diversified Sources of Growth
Q3 2024 HIGHLIGHTS (1) Diversified Sources of Growth HEYDUDE 20% ENTERPRISE SHARE OF WHL DTC Brand Channel 49% 51% Crocs 80% International CROCS BRAND 44% SHARE OF Geography North America 56% 1. Trailing Twelve Month ratio 6
Slide 7: Driving Durable & Consistent Growth
Q3 2024 HIGHLIGHTS Driving Durable & Consistent Growth #2 #3 #1 Tier 1 Market Attract New Ignite Our Icons Share Gains Consumers through driving awareness through strategic through methodically and global relevance for investment behind talent, diversifying our product new and existing marketing, di
Slide 8: Crocs Brand Highlights
Q3 2024 HIGHLIGHTS Crocs Brand Highlights Q3 2024 Revenues $858M (1) year-over-year growth of +8% Brought McDonald's, Bath & Body Works, Squishmallow and more collaborations to life Launched "Live Life Fully Loaded" campaign leading to high consumer engagement in-store and online for Classic Clog an
Slide 9: Crocs Brand | Our Product Franchises
Q3 2024 HIGHLIGHTS Crocs Brand | Our Product Franchises Crocs x Squishmallow Crocs x Bath & Body Works Cozzzy Slipper Crocs x McDonald's Crocs x Batman Echo Surge 9
Slide 10: Global Market Highlights
Q3 2024 HIGHLIGHTS Global Market Highlights Strong international growth (1) from our Crocs brand, +17% led by Australia, China, France and Germany (1) China grew >20% on top of (1) >90% growth, with 2/3 of growth driven by mono-brand partner stores Tier 1 Markets: China, India, Japan, South Korea, t
Slide 11: HEYDUDE Brand Highlights
Q3 2024 HIGHLIGHTS HEYDUDE Brand Highlights Q3 2024 Revenues $204M year-over-year change of (17)% Iterated on Wendy and Wally Icons through color, graphics, height and personalization Opened 11 outlet locations, bringing YTD net openings* to 29 locations *YTD net openings includes 30 openings, 1 clo
Slide 12: HEYDUDE Brand | Our Product Franchises
Q3 2024 HIGHLIGHTS HEYDUDE Brand |Our Product Franchises HEYDUDE x SpongeBob Wendy COMF Wendy Stretch Sox Funk Mono Wally Stretch Canvas HEYDUDE x Beetlejuice Jelly Roll Wally Slip 12
Slide 13: HEYDUDE Brand | Strategic Pillars
Q3 2024 HIGHLIGHTS HEYDUDE Brand | Strategic Pillars Drive youth female culture and create a HEYDUDE brand community Build the core, our Wendy and Wally, and add more Stabilize, then accelerate North America 13
Slide 14: Financial Highlights
Financial Highlights 14
Slide 15: Q3 2024 Financial Highlights
FINANCIAL HIGHLIGHTS (1) Q3 2024 Financial Highlights B/(W) ($M) Q3 vs. PY Revenues $1,062 +2% (2) Adjusted Gross Margin 59.6% +220 bp (2) Adjusted SG&A as % of Revenue 34.2% (510) bp 430 (2) Adjusted Operating Income $270 (9)% (2) Adjusted Operating Margin 25.4% (290) bp (2) Adjusted Diluted EPS $3
Slide 16: Q3 Adjusted Gross Margins
FINANCIAL HIGHLIGHTS (1,2) Q3 Adjusted Gross Margins 62.1% 62.5% 57.4% 59.6% 47.9% 42.8% Q3'23 Q3'24 Q3'23 Q3'24 Q3'23 Q3'24 1. See reconciliation to GAAP equivalents in Appendix. 2. During the periods, there were no non-GAAP adjustments for the HEYDUDE brand. 16
Slide 17: Q3 Adjusted Operating Margin
FINANCIAL HIGHLIGHTS (1) Q3 Adjusted Operating Margin 28.3% 25.4% Q3'23 Q3'24 1. See reconciliation to GAAP equivalents in Appendix. 17
Slide 18: Q3 Inventory Levels
FINANCIAL HIGHLIGHTS Q3 Inventory Levels 6% YoY decrease $390M $367M Q3 '23 Q3 '24 18
Slide 19: 2024 Capital Allocation Priorities
FINANCIAL HIGHLIGHTS 2024 Capital Allocation Priorities Brand Growth Debt Return of Capital to Investment Paydown Shareholders 2024 is an investment year Repaid $110M of debt, with Repurchased 1.1M shares, supported by our best-in- total borrowings now $549M remaining on current class gross margins
Slide 20: Financial Outlook
Financial Outlook CROCS ine:
Slide 21: Guidance: Q4 and Full Year 2024
FINANCIAL OUTLOOK Guidance: Q4 and Full Year 2024 Q4 2024 FY 2024 Total Revenue Growth Flat to Up Slightly Approximately ~3% Revenue Growth Approximately ~2% Approximately ~8% Revenue Growth (6%) to (4%) Approximately (14.5%) (1,3) Adjusted Operating Margin ~19.5% Over 25% (1,3) Adjusted One Time Co
Slide 22: Appendix
Appendix 22
Slide 23: Non-GAAP Reconciliation
APPENDIX Non-GAAP Reconciliation In addition to financial measures presented on the basis of accounting principles generally accepted in the United States of America (“GAAP”), we present "Non-GAAP gross profit," “Non-GAAP gross margin,” “Non-GAAP gross margin by brand,” "Non-GAAP selling, general, a
Slide 24: Non-GAAP Reconciliation
APPENDIX Non-GAAP Reconciliation Non-GAAP Gross Profit and Gross Margin Reconciliation: Three Months Ended September 30, 2024 2023 (in thousands) GAAP revenues $ 1,062,200 $ 1,045,717 GAAP gross profit $ 633,339 $ 581,636 (1) Distribution centers — 18,797 Non-GAAP gross profit 633,339 600,433 GAAP g
Slide 25: Non-GAAP Reconciliation (Cont'd)
APPENDIX Non-GAAP Reconciliation (Cont'd) Non-GAAP Gross Margin Reconciliation by Brand: Three Months Ended September 30, 2024 2023 GAAP Crocs Brand gross margin 62.5 % 61.9 % Non-GAAP adjustments: (1) Distribution centers —% 0.2 % Non-GAAP Crocs Brand gross margin 62.5 % 62.1 % Three Months Ended S
Slide 26: Non-GAAP Reconciliation (Cont'd)
APPENDIX Non-GAAP Reconciliation (Cont'd) Non-GAAP selling, general and administrative reconciliation: Three Months Ended September 30, 2024 2023 (in thousands) GAAP revenues $ 1,062,200 $ 1,045,717 GAAP selling, general and administrative expenses $ 363,510 $ 307,784 Impairment related to informati
Slide 27: Non-GAAP Reconciliation (Cont'd)
APPENDIX Non-GAAP Reconciliation (Cont'd) Non-GAAP Income from Operations and Operating Margin Reconciliation: Three Months Ended September 30, 2024 2023 (in thousands) GAAP revenues $ 1,062,200 $ 1,045,717 GAAP income from operations $ 269,829 $ 273,852 (1) Non-GAAP gross profit adjustments — 18,79
Slide 28: Non-GAAP Reconciliation (Cont'd)
APPENDIX Non-GAAP Reconciliation (Cont'd) Non-GAAP Income Tax Expense (Benefit) and Effective Tax Rate Reconciliation: Three Months Ended September 30, 2024 2023 (in thousands) GAAP income from operations $ 269,829 $ 273,852 GAAP income before income taxes 244,897 233,405 (1) Non-GAAP income from op
Slide 29: Non-GAAP Reconciliation (Cont'd)
APPENDIX Non-GAAP Reconciliation (Cont'd) Non-GAAP Earnings Per Share Reconciliation: Three Months Ended September 30, 2024 2023 (in thousands, except per share data) Numerator: GAAP net income $ 199,801 $ 177,025 (1) Non-GAAP gross profit adjustments — 18,797 (2) Non-GAAP selling, general and admin
Slide 30: Non-GAAP Reconciliation (Cont'd)
APPENDIX Non-GAAP Reconciliation (Cont'd) Reconciliation of GAAP to Non-GAAP Financial Guidance: Full Year 2024: Approximately: Non-GAAP operating margin reconciliation: GAAP operating margin Over 24% (1) Non-GAAP adjustments, primarily related to IT system impairments 1% Non-GAAP operating margin O
Slide 31: Crocs, Inc.
CROCS inc: