Slide 1: Investor Presentation
INVESTOR PRESENTATION February 2021
Slide 2: Forward-Looking Statement
Some information provided in this document will be forward-looking, and accordingly, is subject to the Safe Harbor FORWARD-LOOKING provisions of the federal securities law. These statements include, but are not limited to, statements regarding potential impacts to our business related to the COVID-1
Slide 3: Content
• 2020 Highlights CONTENT • Positioned for Global Growth • Financial Results • Appendix 3
Slide 4: Executive Summary
Executive Summary • Highest quarterly revenue in company history achieved in the fourth quarter • Record 2020 revenue of $1.4bn, up over 12%, which was in line with pre-COVID guidance • 2020 Digital revenue growth +50% resulting in record digital penetration of 42%; DTC comparable sales +39% • 2020
Slide 5: 2020 Highlights
2020 HIGHLIGHTS Source: Image from Reddit. 5 Source: Images from Instagram, Twitter.
Slide 6: Incredible Year for Crocs
2020 HIGHLIGHTS Incredible Year for Crocs • Record revenue of $1.4bn in 2020, +13% amidst the COVID-19 pandemic • Awarded Footwear News Achievement Awards (FNAA) 2020 Brand of the Year • Increased brand desirability, relevance and consideration by double digits for 4th consecutive year • Accelerated
Slide 7: Exceptional Revenue Growth and Adjusted Operating Margin
2020 HIGHLIGHTS Exceptional Revenue Growth and Adjusted Operating Margin 2,000 30.0% $1,730 25.0% $1,660 1,500 $1,386 $1,231 20.0% $1,088 18.9% ~18-19% 1,000 15.0% 11.6% 10.0% 500 7.7% 5.0% 0 0.0% 2018 2019 2020 2021E YOY Growth +6.3% +13.1% +12.6% +20-25% Note: Revenue in USD millions. 7
Slide 8: Best in Class Marketing Activations: 4Q 2020
2020 HIGHLIGHTS Best in Class Marketing Activations: 4Q 2020 8
Slide 9: Accelerated Digital Growth in 2020
2020 HIGHLIGHTS Accelerated Digital Growth in 2020 • 2020 Digital revenue +50% with growth in all regions • Strong 2020 e-commerce growth of +58% • Double-digit growth across multiple e-tail platforms 2020 Digital Penetration 55% 39% 39% 40% 42% 29% 28% 31% Americas Asia Pacific EMEA 2019 2020 2019
Slide 10: Positioned for Global Growth
POSITIONED FOR GLOBAL GROWTH Four Key Powerful Social & Digital-Led Largest Long-Term Product Pillars Digital Marketing Route to Market Growth Opportunity in Asia Clogs: Innovate & grow clog Digital and social focus globally E-commerce: Double-digit plus Americas: Strong growth relevance growth cont
Slide 11: Significant Long-Term Growth Potential in Sandals
POSITIONED FOR GLOBAL GROWTH Significant Long-Term Growth Potential in Sandals • $30B global category growing ~4% p.a. − Fragmented market with no clear leader − Crocs opportunity is to grow our share • Consistent track record of growth ‒ 18% of footwear sales in 2020 ‒ Pre-COVID, three consecutive
Slide 12: Capitalize on Personalization Trend with Jibbitz Charms
POSITIONED FOR GLOBAL GROWTH Capitalize on Personalization Trend with JibbitzTM Charms • Personalization is a global megatrend • Optimistic story-telling and personalization will be even more critical post COVID-19 • Offers newness and inspiration at a compelling price point at point of sale • Enhan
Slide 13: Digital-Led Route to Market
POSITIONED FOR GLOBAL GROWTH Digital-Led Route to Market 42% 31% 17% 15% 11% 13% 2015 2016 2017 2018 2019 2020 E-Commerce Penetration E-Tail Penetration 4Q 2020 represented 15th consecutive quarter of double-digit e-commerce revenue growth Note: Chart reflects digital sales (e-commerce and e-tail) a
Slide 14: The China Opportunity
POSITIONED FOR GLOBAL GROWTH The China Opportunity Significant Whitespace • 2nd largest footwear market in the world • Underpenetrated with only ~5% of our 2019 sales in China Investing for Growth • Building brand awareness in second year with Yang Mi • Developing local-for-local marketing and colla
Slide 15: Financial Results
FINANCIAL RESULTS 15
Slide 16: 2020: A Very Successful Year
FINANCIAL RESULTS 2020: A Very Successful Year • Robust revenue growth (+13%) • Improved quality of revenues ‒ Fewer discounts and promotions • Expanded margins ‒ Higher prices ‒ Fewer discounts and promotions ‒ Favorable product mix ‒ Leveraged SG&A, while supporting growth • Invested to support fu
Slide 17: 2020 Q4 Financial Results
FINANCIAL RESULTS 2020 Q4 Financial Results Q4 vs. PY Revenue $411.5 +56.1%* Gross Margin 55.7% +770 bp Adj. Gross Margin** 56.0% +670 bp Adj. SG&A as % of Revenue** 34.9% +950 bp Operating Margin 15.7% +1,250 bp Adj. Operating Margin** 21.1% +1,620 bp Diluted EPS $2.69 +827% Adj. Diluted EPS** $1.0
Slide 18: 2020 Financial Results
FINANCIAL RESULTS FINANCIAL RESULTS 2020 Financial Results 2020 vs. PY Revenue $1,386.0 +13.5%* Gross Margin 54.1% +400 bp Adj. Gross Margin** 54.6% +350 bp Adj. SG&A as % of Revenue** 35.6% +390 bp Operating Margin 15.4% +490 bp Adj. Operating Margin** 18.9% +730 bp Diluted EPS $4.56 +175% Adj. Dil
Slide 19: Shareholder Returns: Share Repurchase
FINANCIAL RESULTS Shareholder Returns: Share Repurchase • Since 2016, we have repurchased $431M in shares at an average price of $22.65 per share $171 $147 $63 $50 $0 0 2016 2017 2018 2019 2020 % of Basic WASO -- 7.8% 8.6% 8.6% 5.5% Avg. Repurchase Price -- $8.82 $17.44 $24.20 $46.50 Share Count (10
Slide 20: 2020 Tax Restructure
FINANCIAL RESULTS 2020 Tax Restructure • In Q4, we completed a series of transactions resulting in changes to our international legal structure, including a transfer of certain intellectual property (IP) rights to the Netherlands, primarily to align with current and future international operations •
Slide 21: 2021 Reporting Changes
FINANCIAL RESULTS 2021 Reporting Changes • To reflect the importance of Direct to Consumer (DTC), we will report two channels – DTC and Wholesale ‒ Combining Retail and E-Com channels into a new DTC channel ‒ Reporting DTC Revenue and DTC Comp only ‒ Continuing to report Digital as a % Revenue • Rep
Slide 22: 2021 Outlook
FINANCIAL RESULTS 2021 Outlook Assuming no impact of future COVID-related shutdowns in major markets, we expect: Q1 2021E FY 2021E Revenue Growth 40-50% 20-25% Non-GAAP Adjustments to Gross Margin $3M $12-15M Adjusted Operating Margin 17-18% 18-19% GAAP Tax Rate 25% Non-GAAP Tax Rate 16-18% Capital
Slide 23: Key Investment Highlights
Key Investment Highlights • Leading Global Footwear Brand Anchored by Iconic Product with Democratic Appeal • Market Leader in Clog Category with Significant Whitespace in Sandals and Personalization • Accelerating Our Industry Leading Digital Penetration • Global Footprint with Opportunity to Grow
Slide 24: Appendix
APPENDIX 24
Slide 25: Comprehensive ESG Commitment
COMPREHENSIVE ESG COMMITMENT Environment Social Governance • Sustainable Ingredients • Human Capital • Board and Management • Resource Use • Social Capital • Business Ethics / Risk Management • Packaging • Community Involvement / Crocs Cares • Accounting Practices / Internal • End of Life Controls W
Slide 26: Select ESG Data
Select ESG Data Environment Social Governance • Joined Sustainable Apparel Coalition (SAC) • Diverse workforce with diversity recruiting strategy • Remains an area of strength evidenced by ISS − Female: 52% Management / 68% All Other and MSCI rankings • Exploring environmentally-friendly raw materia
Slide 27: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION Non-GAAP cost of sales, gross profit, and gross margin reconciliation: Non-GAAP selling, general and administrative expenses reconciliation: Three Months Ended December Year Ended Three Months Ended December Year Ended 31, December 31, 31, December 31, 2020 2019 2020 2019 202
Slide 28: Non-GAAP Reconciliation (cont'd)
NON-GAAP RECONCILIATION (cont’d) Non-GAAP income from operations and operating margin reconciliation: Non-GAAP income tax expense (benefit) and effective tax rate reconciliation: Three Months Ended December Year Ended Three Months Ended December Year Ended 31, December 31, 31, December 31, 2020 2019
Slide 29: Non-GAAP Reconciliation (cont'd)
NON-GAAP RECONCILIATION (cont’d) Non-GAAP earnings per share reconciliation: RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL GUIDANCE Three Months Ended Year Ended December 31, December 31, First Quarter 2021: 2020 2019 2020 2019 Approximately: (in thousands, except per share data) Non-GAAP operating m
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