YETI Holdings, Inc. · NYSE:YETI
YETI — Q2 2023 Earnings Presentation
30 slides from YETI's earnings presentation, Aug 10, 2023
Slide 1: Second Quarter 2023 Highlights
Second Quarter 2023 Highlights
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT Disclaimer We are not making any representations or warranties, express or implied, with respect to the information (financial, business , legal or otherwise) contained in this presentation. No person has been authorized to give any information other than that contained in this
Slide 3: Strategic Priorities: Q2 2023 Highlights
STRATEGIC PRIORITIES: Q2 2023 HIGHLIGHTS 1 EXPAND OUR CUSTOMER BASE Expanded YETI’s culinary presence with new activations across ambassadors, digital series and television Focused on expanding seasonal consumer touch points in addition to traditional Moms, Dads, and Grads efforts Activated new glob
Slide 4: Q2 2023 Results at a Glance
Q2 2023 RESULTS AT A GLANCE ADJUSTED Q2 2023 Q2 2023 ADJUSTED NET SALES1 FINANCIAL METRICS1 $427M Net Sales +2% Net Sales Growth Coolers & -6% +8% Equipment Coolers & Equipment Drinkware 42% $427M Drinkware 55% +4% -1% Wholesale DTC Other2 3% $67M Operating Income 15.7% Operating Margin 1. Based on
Slide 5: Brand & Product
BRAND,.& PRODUCT s BUNT FOR THE Wael
Slide 6: Growing Diverse, Global YETI Communities
GROWING DIVERSE, GLOBAL YETI COMMUNITIES 2006 Community Reach FISHING HUNTING 2023 Community Reach FISH HUNT BBQ CULINARY BEVERAGE SKATE SURF/PADDLE SKI/SNOW CLIMB/ALPINE RODEO RANCH EQUESTRIAN WELLNESS GOLF SPORTS Relevance Through Breadth & Depth 15 Communities 177 Ambassadors 6
Slide 7: Extensive Media Reach
EXTENSIVE MEDIA REACH LARGE AND GROWING SOCIAL MEDIA PRESENCE EARNED MEDIA AWARDS Followers1 5.3M 5.2M 4.6M 1.9M 1.1M 1.0M 982K ROADIE® 48 WHEELED TUNDRA® HAUL LOADOUT GOBOX® 624K COOLER WHEELED COOLER GEAR CASE 581K BROAD EARNED MEDIA COVERAGE 1 Instagram followers as of August 1, 2023. 7
Slide 8: Media Highlights
MEDIA HIGHLIGHTS Luxury Father's Day Gifts Dad Will Brag About for Years to Come 8
Slide 9: Coolers & Equipment Evolution
COOLERS & EQUIPMENT EVOLUTION 2017 2018 2019 2020 2021 2022 2023* Hard Coolers YETI XV Tundra Haul® Silo® YETI V Series ® Roadie® 24 Tundra® 50 Roadie® 48 Roadie® 60 Soft Coolers Hopper Flip® 8 & Flip® 18 Daytrip® Hopper® Daytrip® Hopper® Hopper® Hopper BackFlip™ Lunch Bag M30 Lunch Box M20 Backpack
Slide 10: Drinkware Evolution
DRINKWARE EVOLUTION 2017 2018 2019 2020 2021 2022 2023* Colored 10 Oz. 26 Oz. 26 Oz. Travel 25 / 35 Oz. Drinkware Tumbler Stackable Straw Cup Mugs Straw Mugs Drinkware 26 Oz. Jr. Kids 12 Oz. Yonder Yonder 18 / 26 Oz. Jug 18 Oz. 46 Oz. / 64 Oz. 26 Oz. Straw Bottle Straw Bottle HotShot Chug Bottles Bo
Slide 11: Extending Product Reach
EXTENDING PRODUCT REACH Customization Color Limited Edition CUSTOMIZATION, COLOR, AND LIMITED EDITION OFFERINGS ENCOURAGE NEW AND REPEAT PURCHASES 11
Slide 12: Channels & Supply Chain
CHANNELS & SUPPLY CHAIN 12. BUILT FOR THE WILD, we
Slide 13: Omni-Channel Strategy
OMNI-CHANNEL STRATEGY OVERVIEW • Balanced omni-channel strategy across DTC and wholesale channels • DTC business supports higher gross margin profile • Diverse group of U.S. wholesale partners with only one account exceeding 10% of total gross sales1 • International reach into Canada, Australia, New
Slide 14: Wholesale
WHOLESALE NATIONAL & REGIONAL ACCOUNTS INDEPENDENT DEALERS • Diverse dealers across BBQ, boating, building supply, camping, farming, fishing, hardware, hunting & shooting, and outdoor destinations • ~60% U.S. dealer reduction from FY15 to FY21 to strengthen our brand, drive merchandising consistency
Slide 15: DTC Channel
DTC CHANNEL YETI ECOMMERCE RETAIL GLOBAL SITES: US 14 Stores Canada Australia New Zealand EU France Germany Ireland Italy Netherlands UK CORPORATE SALES YETI AUTHORIZED 15
Slide 16: Expand Internationally
EXPAND INTERNATIONALLY EXPANSION STRATEGY INTERNATIONAL FOOTPRINT • Focused on existing markets to drive deep consumer relevance and develop optimal omni-channel distribution 2019 Entry 2017 Entry 2019 Websites: UK, EU 2019 Website: YETI.CA 2021 Websites: DE, FR, IT, IE, NL • Building localized lead
Slide 17: Global Supply Chain
GLOBAL SUPPLY CHAIN GLOBAL INFRASTRUCTURE • Partnerships with leading third-party manufacturing and logistics partners • Ongoing supplier focus on optimizing quality, delivery and best cost • Future capacity framework informed by diversification and redundancy • 3PL facilities in Memphis, Salt Lake
Slide 18: Financials
_ FINANCIALS » nd
Slide 19: Adjusted Q2 2023 Results
ADJUSTED Q2 2023 RESULTS1 ADJUSTED NET SALES $427 $420 Q2 2022 Q2 2023 CATEGORY ADJUSTED NET SALES GROWTH Coolers & Equipment $193 Drinkware $233 $181 $216 Q2 2022 Q2 2023 Q2 2022 Q2 2023 CHANNEL ADJUSTED NET SALES GROWTH Wholesale Direct-to-Consumer $195 $193 $235 $225 Q2 2022 Q2 2023 Q2 2022 Q2 20
Slide 20: Adjusted Q2 2023 Results (Cont'd)
ADJUSTED Q2 2023 RESULTS1 (CONT’D) ADJUSTED GROSS PROFIT ADJUSTED SG&A Adjusted Gross Profit $ / % Margin Adjusted SG&A $ / % Margin $234 / 54.9% $167 / 39.1% $219 / 52.2% $145 / 34.6% Q2 2022 Q2 2023 Q2 2022 Q2 2023 ADJUSTED OPERATING INCOME ADJUSTED EPS Adjusted Operating Income $ / % Margin $74 /
Slide 21: Adjusted Historical Results
ADJUSTED HISTORICAL RESULTS1 ADJUSTED NET SALES ADJUSTED GROSS PROFIT Adjusted Gross Profit % Margin $1,634 $1,000 70.0% $1,411 $900 $860 $816 $800 65.0% $700 $629 $1,092 $600 60.0% $475 $914 $500 $383 57.8% $779 $400 57.6% 55.0% $300 $200 52.0% 52.7% 50.0% $100 49.2% $0 45.0% 2018 2019 2020 2021 20
Slide 22: Adjusted Historical Results (Cont'd)
ADJUSTED HISTORICAL RESULTS1 (CONT’D) CASH FREE CASH FLOW2 $312 $351 $253 $235 $155 $80 $73 $90 $55 $55 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 CAPITAL EXPENDITUTRES TOTAL DEBT3 Capital Expenditures % of Adjusted Net Sales $70 10.0% $333 $60 $56 $300 $50 $46 8.0% $40 6.0% $32 $30 $135 $21
Slide 23: FY 2023 Outlook (as of 8/10/23)
FY 2023 OUTLOOK (as of 8/10/23) Metric Current Outlook1 Prior Outlook1 Adjusted Net Sales $1.699B to $1.715B $1.683B to $1.715B Up 4% to 5% YoY Up 3% to 5% YoY Adjusted Gross Margin 55.5% to 56.0% ~55.0% Adjusted Operating Margin 15.5% to 16.0% 15.0% to 15.5% Effective Tax Rate ~25.1% ~24.9% Adjuste
Slide 24: Appendix
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Slide 25: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION 2018(1) 2019(1)(2) 2020(1) 2021(1) 2022(1) Net sales $ 778.8 $ 913.7 $ 1,091.7 $ 1,411.0 $ 1,595.2 Product recalls(3) — — — — 38.4 Adjusted net sales $ 778.8 $ 913.7 $ 1,091.7 $ 1,411.0 $ 1,633.6 Gross margin $ 383.1 $ 475.3 $ 628.8 $ 816.1 $ 763.4 Product recalls(3) — — — —
Slide 26: Non-GAAP Reconciliation (Cont'd)
NON-GAAP RECONCILIATION (CONT’D) 2018(1) 2019(1)(2) 2020(1) 2021(1) 2022(1) Operating income $ 102.2 $ 89.8 $ 214.2 $ 274.9 $ 126.4 Non-cash stock-based compensation expense(4)(10) 13.2 52.3 9.0 15.5 17.8 Long-lived asset impairment(10) 1.2 0.6 1.1 2.5 1.2 Product recalls(3) — — — — 128.9 Business o
Slide 27: Non-GAAP Reconciliation (Cont'd)
NON-GAAP RECONCILIATION (CONT’D) Q2 2022 Q2 2023 Net sales $ 420.0 $ 402.6 Product recalls(3) — 24.5 Adjusted net sales $ 420.0 $ 427.1 Gross profit $ 219.1 $ 214.8 Product recalls(3) — 19.4 Adjusted gross profit $ 219.1 $ 234.3 Adjusted gross margin 52.2 % 54.9 % Selling, general, and administrativ
Slide 28: Non-GAAP Reconciliation (Cont'd)
NON-GAAP RECONCILIATION (CONT’D) Q2 2023 Q2 2022 Product Adjusted Product Adjusted Net Sales Recalls(3) Net Sales Net Sales Recalls(3) Net Sales Channel Wholesale $ 176.2 $ 16.4 $ 192.5 $ 195.2 $ — $ 195.2 Direct-to-consumer 226.4 8.1 234.5 224.8 — 224.8 Total $ 402.6 $ 24.5 $ 427.1 $ 420.0 $ — $ 42
Slide 29: Non-GAAP Reconciliation (Cont'd)
NON-GAAP RECONCILIATION (CONT’D) 1. Beginning with the second quarter of Fiscal 2022, YETI revised its definitions of certain non-GAAP financial measures by excluding Other expense (income) from non-GAAP results. This change was retrospectively applied to all periods presented. 2. Beginning with the
Slide 30: Historical Adjusted Net Income Recast
HISTORICAL ADJUSTED NET INCOME RECAST As Recast(1) Q1 2021 Q2 2021 Q3 2021 Q4 2021 FY 2021 Q1 2022 Net income $ 30.5 $ 56.2 $ 53.0 $ 72.9 $ 212.6 $ 25.7 Adjustments: Non-cash stock-based compensation expense(2) 3.4 4.1 3.8 4.1 15.5 4.8 Long-lived asset impairment(2) 0.3 0.9 1.2 0.1 2.5 — Other expen