YETI Holdings, Inc. · NYSE:YETI
YETI — Q4 2022 Earnings Presentation
31 slides from YETI's earnings presentation, Feb 23, 2023
Slide 1: Fourth Quarter 2022 Highlights
Fourth Quarter 2022 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: Q4 2022 Highlights
STRATEGIC PRIORITIES: Q4 2022 HIGHLIGHTS 1 EXPAND OUR CUSTOMER BASE Elevated YETI gifting consideration and highlighted year-round usage with “Use Your Gifts” holiday campaign Announced global partnership with the World Surf League (WSL) in January 2023 Debuted first wellness-oriented brand campaign
Slide 4: FY 2022 Results at a Glance
FY 2022 RESULTS AT A GLANCE ADJUSTED FY 2022 FY 2022 ADJUSTED NET SALES1 FINANCIAL METRICS1 $1.63B Net Sales +16% Net Sales Growth Coolers & +18% +14% Equipment Coolers & Equipment Drinkware 40% $1.63B Drinkware 58% +18% +13% Wholesale DTC Other2 2% $274M Operating Income 16.8% Operating Margin 1. B
Slide 5: Brand & Product
BRAND & PRODUCT 5
Slide 6: Building Diverse YETI Communities
BUILDING DIVERSE YETI COMMUNITIES 2006 Community Reach FISHING HUNTING 2022 Community Reach FISHING HUNTING BEER & BBQ CULINARY SKI/SNOWBOARD SKATEBOARD SURF/PADDLE CLIMB/ALPINE RODEO RANCH WELLNESS MUSIC SPORTS Relevance Through Breadth & Depth 13 Communities 162 Ambassadors 6
Slide 7: Strong, Diverse Media Reach
STRONG, DIVERSE MEDIA REACH LARGE AND GROWING SOCIAL MEDIA PRESENCE EARNED MEDIA AWARDS Followers1 5.3M 5.1M 4.4M 1.8M 1.1M 1.0M 871K 617K TUNDRA® 65 HARD ROADIE® 48 WHEELED TRAILHEAD® COOLER COOLER DOG BED 564K BROAD EARNED MEDIA COVERAGE 1 Instagram followers as of February 12, 2023. 7
Slide 8: Media Highlights
MEDIA HIGHLIGHTS Forbes WSJ Yeti’s Latest Yonder Bottles Ditch The The Yeti Water Bottle Everyone Me . - We tried the Yeti Yonder, the Heavy-Duty Metal Hardware Needs The 8 Best Water Bottles Under $50 brand’s lightest water bottle yet Best plastic water bottle SELF Forbes ‘ ‘ ; The Best Coolers For
Slide 9: Broadening Awareness
BROADENING AWARENESS DOMESTIC UNAIDED BRAND AWARENESS BY REGION1 2016 2018 2020 2022 20% 19%19% 18% 17% 17% 16% 16% 15% 15%15% 15% 14% 14% 14% 14% 14%14% 13% 13% 13% 13% 13% 11% 10% 10% 10% 9% 8% 8% 7% 6% 5% 5% 4% 3% 2% 2% 1% 1% East South West South New England West North East North South Atlantic
Slide 10: Product & Category Evolution Since 2017
PRODUCT & CATEGORY EVOLUTION SINCE 2017 2017 2018 2019 2020 2021 2022 Hard Coolers YETI Roadie® YETI XV Roadie® Roadie® Haul™ Silo® V Series™ 24 Tundra 50 48 60 Soft Coolers Hopper Flip® 8 Daytrip® Hopper® Daytrip® Hopper® Hopper® Coolers & Equipment Hopper® Two & Flip® 18 Hopper BackFlip™ Lunch Bag
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
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% dealer reduction from FY15 to FY21 to strengthen our brand, drive merchandising consistency, and
Slide 15: DTC Channel
DTC CHANNEL YETI ECOMMERCE RETAIL AUSTIN South Congress AUSTIN Domain CARLSBAD CHARLESTON CHICAGO DALLAS DENVER EL SEGUNDO LAS OLAS HOUSTON SAN ANTONIO SCOTTSDALE SOUTHLAKE 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 • Building localized leadership and talent, processes, and 2019 Entry brand elements to scale opportunities 2017 Entry 2019 W
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 18
Slide 19: Adjusted Q4 2022 Results
ADJUSTED Q4 2022 RESULTS1 ADJUSTED NET SALES $486 $443 Q4 2021 Q4 2022 CATEGORY ADJUSTED NET SALES GROWTH Coolers & Equipment Drinkware $169 $308 $152 $286 Q4 2021 Q4 2022 Q4 2021 Q4 2022 CHANNEL ADJUSTED NET SALES GROWTH Wholesale Direct-to-Consumer $316 $179 $171 $264 Q4 2021 Q4 2022 Q4 2021 Q4 20
Slide 20: Adjusted Q4 2022 Results (Cont'd)
ADJUSTED Q4 2022 RESULTS1 (CONT’D) ADJUSTED GROSS PROFIT ADJUSTED SG&A Adjusted Gross Profit $ / % Margin Adjusted SG&A $ / % Margin $264 / 54.3% $175 / 36.0% $255 / 57.5% $155 / 35.0% Q4 2021 Q4 2022 Q4 2021 Q4 2022 ADJUSTED OPERATING INCOME ADJUSTED EPS Adjusted Operating Income $ / % Margin $100
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
FY 2023 OUTLOOK (as of 2/23/23) Metric Outlook1 Adjusted Net Sales $1.683B to $1.715B Up 3% to 5% YoY Adjusted Gross Margin ~55.0% Adjusted Operating Margin 15.0% to 15.5% Effective Tax Rate ~24.9% Adjusted Income per Diluted Share $2.12 to $2.23 Down 5% to 10% YoY Diluted Weighted Avg. Shares Outst
Slide 24: Appendix
APPENDIX 24
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
NON-GAAP RECONCILIATION 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 optimizati
Slide 27: Non-GAAP Reconciliation (Cont'd)
NON-GAAP RECONCILIATION (CONT’D) Q4 2021 Q4 2022 Net sales $ 443.1 $ 448.0 Product recalls(3) — 38.4 Adjusted net sales $ 443.1 $ 486.4 Gross margin $ 254.8 $ 167.0 Product recalls(3) — 97.0 Adjusted gross margin $ 254.8 $ 264.0 Adjusted gross profit 57.5 % 54.3 % Selling, general, and administrativ
Slide 28: Non-GAAP Reconciliation (Cont'd)
NON-GAAP RECONCILIATION (CONT’D) Q4 2022 Q4 2021 Product Adjusted Product Adjusted Net Sales Recalls(3) Net Sales Net Sales Recalls(3) Net Sales Channel Wholesale $ 138.5 $ 32.2 $ 170.7 $ 179.2 $ — $ 179.2 Direct-to-consumer 309.5 6.2 315.7 263.9 — 263.9 Total $ 448.0 $ 38.4 $ 486.4 $ 443.1 $ — $ 44
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
Slide 31: Historical Adjusted Net Sales by Geography
HISTORICAL ADJUSTED NET SALES BY GEOGRAPHY Beginning in 2022, YETI will report net sales by geographic region based on end-consumer location. Historically, YETI reported net sales by geographic region based on shipment origination. Sales by Amazon Canada and our international authorized dealers were