Boot Barn Holdings, Inc. · NYSE:BOOT
Boot Barn — Investor Presentation (August 2018)
44 slides from Boot Barn's investor presentation, Aug 13, 2018
Slide 1: Important Information: Forward-Looking Statements
IMPORTANT INFORMATION Forward-Looking Statements This presentation contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact included in this presentation are forward-looking statements. You can identify forward-looking s
Slide 2: Compelling Investment Story
COMPELLING INVESTMENT STORY • • Healthy brick and mortar same store sales growth Leader and authority in the western and work industry • Proven ability to drive growth and expansion • • Genuine lifestyle retail brand Importance of quality and fit • Private brand penetration growth • • Lifestyle expe
Slide 3: Agenda
AGENDA BOOT BARN STORY STRATEGIC INITIATIVES DRIVE SAME STORE SALES GROWTH 1 CONTINUE OMNI-CHANNEL LEADERSHIP 2 BUILD OUT EXCLUSIVE BRAND PORTFOLIO 3 EXPAND OUR STORE BASE 4 APPENDIX 4
Slide 4: An American Lifestyle
AN AMERICAN LIFESTYLE Country music popularity continues to rise2 Highest selling vehicle1 Thousands of rodeos held in the U.S. Popular spectator sport 1 Business Insider 1/7/2017, “The 20 best-selling cars and trucks in America”; 2 Forbes.com, 10/31/16, “Country Music’s Popularity and Influence Con
Slide 5: Estimated $20 Billion Industry
ESTIMATED $20 BILLION INDUSTRY1 ATTRACTIVE DYNAMICS ~$20 BILLION MARKET OPPORTUNITY • Highly fragmented • Less fashion driven than traditional apparel Western Wear 40% Work Wear 60% • Work wear purchases are often non-discretionary 1Source: Mod Advisors LLC July 3, 2014 6 DRIVERS OF WESTERN WEAR GRO
Slide 6: Sales Diversification
SALES DIVERSIFICATION PRODUCT MIX1 Footwear 53% Apparel 32% Hats, Accessories & Other 15% END USER1 Men 63% Women 24% Unisex 8% Kids 5% CHANNEL1 Stores 83% E-commerce 17% 1 Fiscal year ended March 31, 2018. 2As of March 31, 2018, western styles comprised approximately 70% of our sales, with work rel
Slide 7: Everyday Merchandise Assortment
EVERYDAY MERCHANDISE ASSORTMENT • • Low fashion quotient minimizes markdown exposure Vast majority of our merchandise sales are at full price1 ¹Excludes sheplers.com sales. 8 WORK & OTHER WESTERN SHIRTS PANTS FLAME RESISTANT OUTERWEAR RUGGED FOOTWEAR BELTS / BELT BUCKLES COWBOY HATS WESTERN SHIRTS D
Slide 8: Strong History of Growth
STRONG HISTORY OF GROWTH NET SALES ($MM) 10% CAGR ~24% $678 9% $619 $569 41% $403 48% $346 1 FY13 FY14 FY15 FY16 FY17 FY18 ADJUSTED EBITDA ($MM) ADJUSTED EBIT ($MM) $66 $49 $46 1 1 FY13 FY14 FY15 FY16 FY17 FY18 FY13 FY14 FY15 FY16 FY17 FY18 Note: Fiscal year ends March. FY13 includes 29 stores acqui
Slide 9: Strategic Initiatives Drive Same Store Sales Growth
STRATEGIC INITIATIVES DRIVE SAME STORE SALES GROWTH 1 CONTINUE OMNI-CHANNEL LEADERSHIP 2 BUILD OUT EXCLUSIVE BRAND PORTFOLIO 3 EXPAND OUR STORE BASE 4 10 10
Slide 10: Upgraded Our Creative Look and Feel
1. UPGRADED OUR CREATIVE LOOK AND FEEL 11
Slide 11: Developed Three Distinct Customer Segments
1. DEVELOPED THREE DISTINCT CUSTOMER SEGMENTS 12
Slide 12: Western Creative Addresses Core Customer
1. WESTERN CREATIVE ADDRESSES CORE CUSTOMER DIRECT MAIL SOCIAL EMAIL ... 1m booU>om..ofllclol
Slide 13: Work Creative Is Geared More Male
1. WORK CREATIVE IS GEARED MORE MALE DIRECT MAIL EMAIL SOCIAL
Slide 14: Wonderwest Is a Developing, Growing Segment
1.WONDERWEST IS A DEVELOPING,GROWING SEGMENT SOCIAL DIRECT MAIL EMAIL .. • • wonct«wtatnvt• St hC•rortu·•CourtfryMUMr••trv.. ... • wonc:t..-w. .tttyt. hfett•.... f; "' 1/lll\1\1 H>O'', Dan Post Bone Hummingbird Wingtip Boots <V-15
Slide 15: Buying Portion of Media on a National/Local Basis
1. BUYING PORTION OF MEDIA ON A NATIONAL LOCAL RADIO DELIVERY (FY 2017) BASIS NATIONAL/LOCAL RADIO DELIVERY (FY 2018) 16
Slide 16: Leveraging Broad Reach of TV to Attract New Customers
1.LEVERAGING BROAD REACH OF TV TO ATTRACT NEW CUSTOMERS - - --17
Slide 17: Drive Same Store Sales Growth
1. DRIVE SAME STORE SALES GROWTH 19.6% 17.8% 14.3% 12.1% 11.6% 7.7% 7.3% 7.2% -0.9% 1.2% -2.0% Q1Q2Q3Q4Q1 Q2Q3 '12'12 Q4Q1Q2 '12'13'13 Q3Q4Q1Q2Q3Q4Q1 '13'13'14'14'14'14'15 Q2 '15 Q3 '15 Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1 '15'16'16'16'16'17'17'17'17'18'18'18'18'19 '11 '11'11'11'12 18 18.1% 16.2% 13.8%14.2%
Slide 18: Strategic Initiatives Drive Same Store Sales Growth
STRATEGIC INITIATIVES DRIVE SAME STORE SALES GROWTH 1 CONTINUE OMNI-CHANNEL LEADERSHIP 2 BUILD OUT EXCLUSIVE BRAND PORTFOLIO 3 EXPAND OUR STORE BASE 4 19 19
Slide 19: Continue Omni-Channel Leadership
2. CONTINUE OMNI-CHANNEL LEADERSHIP .,-I SHEPLERS •WES'I'ERHSTOW• COUNTRY OUTFITTER BOO,.BARN. . .....,._.... ----·---·---,._ ,.., o...,.,.'....'"• '"•••• or-uoro COUNTRY T!,I!!!, '••• ' ..• .,_. o...o••• O••• $" -..,. -... _,. -·,..... .....,_. - EXTRA 20% OFF ·,....... ENTIRE SITE ON SALE tt.QCQ.O
Slide 20: Google Paid Search Results
j G western boots - Google x c iSecure I https://www.google.com/search?source=hp&ei=deZPWrycKKmSO• (January 2018) All Shoppmg Maps Images News More Sett1ngs Tools Ab-ou-t 3-,04·0,0-00·res-ult·s (0-.9·9 s-eco·nd-s) ·P-P·C-(P·a-id·} -·-·-·-·-·-·-·-Shopping (Paid) • .,-·-·-·-·-·-·-··-·-·--.• • • ' Sho
Slide 21: Organic Search Results
Organic Search (Free) 22 Search Results Continued (January 2018)
Slide 22: Integrating Physical and Digital Commerce
2. INTEGRATING PHYSICAL AND DIGITAL COMMERCE HOME ONLINE OUTPOST Pick Up Online Orders Here SECURE PICK UP ·FREE SHIPPING ·EASY RETURNS & EXCHANGES WHIP WE HAVE IT PROMISE * Our IN STORE TABLET is an endless aisle of boots, jeans, shirts., hats &. more! * FREE ·2-DAY SHIPPING on all boot purchases*
Slide 23: Building Omni-Channel Leadership
2. BUILDING OMNI-CHANNEL LEADERSHIP IN-STORE COMMERCIAL ONLINE DIRECT STORE POS EVENTS SHIP FROM DC SELL NEW SITES SPECIAL ORDER SHIP FROM VENDOR MOBILE ECOM WHIP COMMERCIAL ACCOUNTS ORM SOCIAL CREDIT CARD CRM OUTPOST 24 TRANSACT FULFILL
Slide 24: Strategic Initiatives Drive Same Store Sales Growth
STRATEGIC INITIATIVES DRIVE SAME STORE SALES GROWTH 1 CONTINUE OMNI-CHANNEL LEADERSHIP 2 BUILD OUT EXCLUSIVE BRAND PORTFOLIO 3 EXPAND OUR STORE BASE 4 25
Slide 25: Build Out Exclusive Brand Portfolio
3. BUILD OUT EXCLUSIVE BRAND PORTFOLIO 13.5% (% of sales) • Growth penetration of 2 ppts annually • Margin enhancement (900 - 1,000 bps) • Continued growth opportunities 1 Represents total company exclusive brand penetration. FY2012 FY2018 26 3% EXCLUSIVE BRAND SALES PENETRATION1 EXCLUSIVE BRAND GRO
Slide 26: Cody James Exclusive Brand Growth Plan
C@DY JAMES * Growth penetration of 2 ppts annually Margin-enhancement (900 - 1,000 bps) Continued growth opportunities * Reoresents total company exclusive brand penetration, FY2012 FY2018 6
Slide 27: In-Store Fixtures, Facebook and Instagram Pages, Email
In-Store Fixtures Facebook and Instagram Pages Email 28
Slide 28: Facebook and Instagram Pages
Facebook and Instagram Pages ‘SHOP WOMEN'S BOOTS SHOP MEN'S BOOTS +SHYANNES For the gals that live down the road, and the free-spirits that are ‘constantly on the go. aa SHOP NOW wz Email 28
Slide 29: In-Store Fixtures, Email, Facebook and Instagram Pages
In-Store Fixtures Email Facebook and Instagram Pages 30
Slide 30: Exclusive Brands Are Leading Brands in the Store
3.EXCLUSIVE BRANDS ARE LEADING BRANDS IN THE STORE Work I Other c:arhart:t:ti. r------MA!JU • ir«O :: ARIAT. L------I ..---, Wrangler :ff-2OAA(\,-: L-------1 I -=:;-I GRACE DANPOST 1 1 I...,. I L---J :lntss:lne® Wrangler :-sH-YANNE+: Built For Work. ·--------ARIAT Iilii Roar· ---------.. · DG) O L J
Slide 31: Strategic Initiatives Drive Same Store Sales Growth
STRATEGIC INITIATIVES DRIVE SAME STORE SALES GROWTH 1 CONTINUE OMNI-CHANNEL LEADERSHIP 2 BUILD OUT EXCLUSIVE BRAND PORTFOLIO 3 EXPAND OUR STORE BASE 4 3322
Slide 32: Expand Our Store Base
4. EXPAND OUR STORE BASE COMPELLING NEW STORE ECONOMICS HISTORICAL STORE BASE 17.5% CAGR 208 232 Store Size (sq. ft.) Year 1 Net Sales Net Cash Investment Cash on Cash Return (Yr. 1) Payback Period New stores/Tuck-ins FY12 - FY18 10,000 $1.7mm $0.8mm ~30% ~3 Years 76 226 219 169 152 117 86 FY 12 FY
Slide 33: Store Footprint Continues to Build
4. STORE FOOTPRINT CONTINUES TO BUILD E-COMMERCE1 STORES More FY12 • 86 stores • 8 states TODAY • 232 stores • 31 states Less 34 1Represents e-commerce sales dollars by state for the fiscal year ended March 31, 2018.
Slide 34: Accelerate Store Openings with Tuck-Ins
4. ACCELERATE STORE OPENINGS WITH TUCK-INS WESTERN WEAR CHAINS (ESTIMATED STORE COUNT)1 232 Tuck-In Acquisitions: National > 2.5x as many stores as closest competitor Woods Boots 79 Regional (Mostly Texas) • • 4 stores in West Texas Acquired 9/11/2017 9 Lone Star North & South Carolina • • 3 stores
Slide 35: Boot Barn Is Now Industry Leading Player
4. BOOT BARN IS NOW INDUSTRY LEADING PLAYER RANK OF U.S. WESTERN RETAILERS AUGUST 2012 AUGUST 2013 AUGUST 2014 TODAY 1 3 36
Slide 36: Boot Barn Is Now Industry Leading Player
4. BOOT BARN IS NOW INDUSTRY LEADING PLAYER RANK OF U.S. WESTERN RETAILERS AUGUST 2012 AUGUST 2013 AUGUST 2014 TODAY BOOT BARN CAVENDER'S, CAVENDERS, BO! WENDERS CAYENDERS ay SHEPLERS SHEELERS SHEPLERS RSS BASKiNS BASKINS nen 2 = — 36
Slide 37: Authority on Boots
4. AUTHORITY ON BOOTS 38
Slide 38: Strong Work Boot Selection
4. STRONG WORK BOOT SELECTION 39
Slide 39: Broad and Deep Denim Assortment
4. BROAD AND DEEP DENIM ASSORTMENT 40
Slide 40: Engaging In-Store Merchandising
4. ENGAGING IN-STORE MERCHANDISING 41
Slide 41: Investment Highlights
INVESTMENT HIGHLIGHTS Genuine lifestyle retail brand Clear national leader in a large and fragmented market niche Significant new store growth opportunity Great omni-channel brand with three leading e-commerce sites Proven ability to drive same store sales growth Strong portfolio of exclusive brands
Slide 42: Investment Highlights
INVESTMENT HIG Genuine lifestyle retail brand aE <> Clear national leader in a large and fragmented market niche Significant new store growth opportunity a Great omni-channel brand with three leading e-commerce sites © Ret ST eae Strong portfolio of exclusive brands i Loyal customer base - Experienc
Slide 43: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION 1The fiscal 2017 column has been adjusted to reflect management’s estimated 52-week results as fiscal 2017 was a 53-week year. The Company estimated that included in fiscal 2017 reported earnings per share was $0.03 attributed to the 53rd week. As such, the Company has
Slide 44: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION Fiscal Year Ended 7 (in thousands) ‘March 3, | April, March 26, March 28, March 29, March 30, 2018 2017" 2016 2015 2014 2013, EBITDA Reconciliatio: Net income $28,879 $ 13,389 $ 9,868 $ 13,730 $ 5,660 $ 680 Income tax expense 2,300 3414 7,403 3,466 3,321 826 Interest e
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