Capri Holdings Limited · NYSE:CPRI
Capri — Q3 2022 Earnings Presentation
16 slides from Capri's earnings presentation, Feb 2, 2022
Slide 1: 3Q Fiscal Year 2022 Earnings Presentation
3Q Fiscal Year 2022 Earnings Presentation February 2, 2022
Slide 2: Third Quarter Fiscal 2022 Highlights
THIRD QUARTER FISCAL 2022 HIGHLIGHTS • Revenue increased 24%, with strong double-digit growth across all three luxury houses • Adjusted gross margin of 65.1% expanded 40 bps vs LY and 560 bps vs LLY, despite increased supply chain costs • Adjusted operating margin of 22.3% expanded 260 bps vs LY and
Slide 3: Growth Initiatives
GROWTH INITIATIVES • COMMUNICATION STRATEGY • Capitalize on high brand engagement and awareness • Reinforce three house pillars • Accelerate database growth • PRODUCT STRATEGY • Expand accessories to $1 billion • More than double footwear revenue • Further capitalize on iconic brand codes • Drive Si
Slide 4: 3Q 2022 Highlights
3Q 2022 HIGHLIGHTS • Revenue increased 29% • Meaningful gross margin expansion • Operating margin expanded 600 bps to 12.7% • Global database +30% year-over-year • La Greca signature represented 17% of sales 4
Slide 5: Growth Initiatives
GROWTH INITIATIVES • COMMUNICATION STRATEGY • Own glamour through Time to Dare campaign • Combine storytelling with data analytics • Double database size • PRODUCT STRATEGY • Capitalize on iconic brand codes • Grow accessories to 30% of revenue • Maximize casual opportunity • Introduce new categorie
Slide 6: 3Q 2022 Highlights
3Q 2022 HIGHLIGHTS • Revenue increased 47% • Significant gross margin expansion • Operating margin of 9%, substantially above expectations • Global database +23% year-over-year • Now anticipate positive operating profit in FY 2022 6
Slide 7: Growth Initiatives
GROWTH INITIATIVES • COMMUNICATION STRATEGY • Emotional brand engagement • Combine storytelling with data analytics • Accelerate database growth • PRODUCT STRATEGY • Increase Signature to 50% of the business • Grow MKGO to $500M • Build Men’s to $500M • OMNI-CHANNEL STRATEGY • Leverage seamless omni
Slide 8: 3Q 2022 Highlights
3Q 2022 HIGHLIGHTS • Revenue increased 20% • GM impacted by higher than anticipated supply chain costs • Operating margin ~ flat to LY and +460bps vs LLY to 28.4% • Global database +20% year-over-year • Global retail AUR increased high teens 8
Slide 9: Fiscal Year 2023 Outlook
FISCAL YEAR 2023 OUTLOOK 1Q 2Q 3Q 4Q FY Revenue ~$1.35B ~$1.45B ~$1.75B ~$1.55B ~$6.1B Versace ~$1.3B Jimmy Choo ~$675M Michael Kors ~$4.125B Adjusted Operating Margin ~18.5% ~18.0% ~23.5% ~15.0% ~19.0% Versace ~18.0% Jimmy Choo ~8.0% Michael Kors ~25.0% Adjusted EPS ~$1.45 ~$1.60 ~$2.50 ~$1.05 ~$6.
Slide 10: Highest Revenue & EPS in Company History
HIGHEST REVENUE & EPS IN COMPANY HISTORY * $7.0B 50.0% ~ $6.10B 45.0% $6.0B $5.55B ~ $5.56B 40.0% $5.24B 35.0% $5.0B 30.0% $4.06B $4.0B 25.0% ADJUSTED ~ 19.0% ~ 19.0% 17.0% 20.0% OPERATING $3.0B 13.6% 15.0% MARGIN 10.7% 10.0% $2.0B 5.0% $1.0B 0.0% FY2019 FY2020 FY2021 FY2022E FY2023E Adj. EPS $4.97
Slide 11: Non-GAAP financial measures notice
This presentation includes certain non-GAAP financial measures that exclude certain costs associated with COVID-19 related charges, long-lived asset impairments, ERP implementation costs, Capri transformation costs, restructuring and other charges. The Company uses non-GAAP financial measures, among
Slide 12: Reconciliation of GAAP to Non-GAAP Financial Measures
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In millions, except per share data) Three Months Ended December 25, 2021 Restructuring COVID-19 As Impairment and Other Related ERP Capri As Reported Charges Charges (1) Charges Implementation Transformation Adjusted Gross profit $ 1,048 $ — $ —
Slide 13: Reconciliation of GAAP to Non-GAAP Financial Measures
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In millions, except per share data) Nine Months Ended December 25, 2021 Restructuring COVID-19 As Impairment and Other Related ERP Capri As Reported Charges Charges(1) Charges Implementation Transformation Adjusted Gross profit $ 2,788 $ — $ — $
Slide 14: Reconciliation of GAAP to Non-GAAP Financial Measures
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In millions, except per share data) Three Months Ended December 26, 2020 Restructuring and COVID-19 Related As Reported Impairment Charges Other Charges (1) Charges As Adjusted Gross profit $ 848 $ — $ — $ (5) $ 843 Operating expenses $ 681 $ (9
Slide 15: Reconciliation of GAAP to Non-GAAP Financial Measures
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In millions, except per share data) Nine Months Ended December 26, 2020 Restructuring COVID-19 Impairment and Other Related Capri ERP As Reported Charges Charges(1) Charges Transformation Implementation As Adjusted Gross profit $ 1,860 $ — $ — $
Slide 16: Safe Harbor Statement
SAFE HARBOR STATEMENT This presentation contains statements which are, or may be deemed to be, “forward-looking statements.” Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of the management of Capri Holdi