G-III Apparel Group, Ltd. · NASDAQ:GIII
G-III Apparel — Q2 FY2025 Earnings Presentation
43 slides from G-III Apparel's earnings presentation, September 2024
Slide 1: G-III Apparel Group
Slide 2: G-III Apparel
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Slide 3: A Global Leader in Fashion
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Slide 4: Who We Are
WHO WE ARE We own and license a portfolio of global brands. With expertise in design, sourcing, distribution and marketing, we bring excitement and confidence to consumers through the fashion we create. 4
Slide 5: G-III at a glance: key facts and figures
$3.10B 600+ 8 GLOBAL REVENUE RETAIL STORES COUNTRIES WITH OPERATING OUR GLOBALLY * CORPORATE OFFICES FY 2024 * Company and partner operated stores * $4.04 $75M 8 RETAIL WEBSITES NON-GAAP (DKNY, DK, KL, KLP, LICENSING REVENUE VBQ, BASS, WILSONS DILUTED EPS LEATHER, SONIA RYKIEL) 30+ 1,200 3,500 BRAND
Slide 6: Our Brands
OUR BRANDS 6
Slide 7: Our Brands
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Slide 8: Our Brands
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Slide 9: Our Brands
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Slide 10: Key Milestones: 65+ Year History
KEY MILESTONES: 65+ YEAR HISTORY • G-III has transformed its business from a niche outerwear manufacturer to a global leader in fashion • Continual evolution of business model with an eye towards the future to drive diversified growth 1950’s 2000’s 2010’s 2020’s FOUNDING BUILDING ACCELERATING EVOLVI
Slide 11: Foundation for Success
FOUNDATION FOR SUCCESS High-performing, Unparalleled Significantly forward-thinking Merchant expertise Diversified expertise across developed sourcing team and in product distribution network categories to deliver and supply chain experienced senior development lifestyle collections infrastructure l
Slide 12: Experienced Leadership
FOUNDATION FOR SUCCESS EXPERIENCED LEADERSHIP • Demonstrated track record of delivering strong operating performance through brand-building initiatives and ability to navigate varied business cycles • Average executive tenure of 21 years Morris Goldfarb Sammy Aaron Jeffrey Goldfarb Dana Perlman Neal
Slide 13: Values
FOUNDATION FOR SUCCESS VALUES ACROSS ALL AREAS OF G-III, OUR TEAM IS: • Passionate about Our Product • Entrepreneurial in Our Thinking • Proud of Our Partnerships • Agile in Our Execution • Accountable for Our Results 13
Slide 14: Merchant Expertise in Product Development
FOUNDATION FOR SUCCESS MERCHANT EXPERTISE IN PRODUCT DEVELOPMENT ACROSS A DIVERSIFIED BRAND PORTFOLIO • Introduction of new brands and growth of existing brands enables G-III to develop scale and capabilities that can be leveraged across the portfolio ASPIRATIONAL & LUXURY BETTER AFFORDABLE 14
Slide 15: Expertise Across Categories
FOUNDATION FOR SUCCESS EXPERTISE ACROSS CATEGORIES TO DELIVER LIFESTYLE COLLECTIONS • Capabilities across women’s and men’s product • Proven track record of expertise, having significantly diversified from outerwear to a broad range of other categories over the last 20 years 2005 2024 OTHER DRESSES
Slide 16: Diversified Distribution
FOUNDATION FOR SUCCESS DIVERSIFIED DISTRIBUTION STRONG RELATIONSHIPS AS A VENDOR OF CHOICE ACROSS CUSTOMERS AND CHANNELS DEPARTMENT DIGITAL PURE OWNED STORES INTERNATIONAL LICENSOR SPECIALTY LUXURY STORE PLAY + WEBSITES PARTNERS* OWNED OFF-PRICE RETAILERS Middle East Asia Europe Latin America * Dist
Slide 17: Developed Sourcing & Supply Chain Infrastructure
FOUNDATION FOR SUCCESS SIGNIFICANTLY DEVELOPED SOURCING & SUPPLY CHAIN INFRASTRUCTURE • Diversified model with best-in-class partners and continual expansion of capacity, capabilities, and countries of manufacturing • Scale and nimble infrastructure ensures preferred pricing, speed to market, and mi
Slide 18: Strategic Priorities for Growth
STRATEGIC PRIORITIES FOR GROWTH Further expand our Expand private portfolio through Extend Drive our Maximize label and sourcing ownership of brands our key brands omni-channel services for 3rd and their licensing global reach across categories opportunities party brands and opportunities retailers
Slide 19: Expand Ownership of Brands
STRATEGIC PRIORITY EXPAND OWNERSHIP OF BRANDS • Generated net revenue of ~$1.5 billion in FY 2024 with highest profitability compared to licensed brands • Extend reach Internationally and into lifestyle categories through licenses • Continue to evaluate future opportunities PORTFOLIO & CATEGORY GROW
Slide 20: Brand Extensions Through Licensing
STRATEGIC PRIORITY BRAND EXTENSIONS THROUGH LICENSING • Broadens reach to consumers through a full range of lifestyle categories •Category expansion, experiential, global store partners •In FY 2024, ~$75M royalty income stream •Strong licensing capability for owned brands with best- in-class partner
Slide 21: Experiential Licensing
STRATEGIC PRIORITY EXPERIENTIAL LICENSING •These concepts are unique ways for fashion brands to drive consumer engagement and fuel brand awareness • Karl Lagerfeld hotel in Macau and Malaysia and multiple luxury residential projects in the works •Vilebrequin beach club in Cannes and multiple other p
Slide 22: Extend Our Global Reach
STRATEGIC PRIORITY EXTEND OUR GLOBAL REACH • Continue to build a strong global platform for growth to enable expansion with current and future brands, including Donna Karan • 200+ company and partner •~165+ company and • ~195+ stores (company and operated stores internationally partner stores partne
Slide 23: Drive Key Brands with Emphasis on Owned Brands
STRATEGIC PRIORITY DRIVE KEY BRANDS WITH AN EMPHASIS ON OWNED BRANDS • Track record of developing brands quickly, having created significant scale in North America and now expanding internationally •Acquired in 2016 •Acquired remaining 80% of Karl Lagerfeld •Acquired in 2016 brand in 2022 •GIII has
Slide 24: International Expansion: Net Sales Potential
GLOBAL REPORTED NET SALES POTENTIAL CURRENT PORTFOLIO OF GO-FORWARD BRANDS • G-III has built a strong corporate foundation • Proven track record and diversified foundation enables G-III to acquire or license brands • Enables G-III to grow current portfolio of brands as well as newly acquire or licen
Slide 25: Digital Sales
STRATEGIC PRIORITY DIGITAL SALES • Grew total digital sales by ~15% in FY 2024 • Strong presence on retail partner sites including department stores, specialty stores, online retailers and marketplaces • Building presence with pureplay partners including, Amazon, Zalando and Fanatics • Continuing to
Slide 26: Grow Private Label Business
STRATEGIC PRIORITY GROW PRIVATE LABEL BUSINESS • Brands and retailers benefit from strength of our overseas sourcing operations • Hired new executive tasked with development of private label business • Incremental revenue opportunity leveraging already existing capabilities and platforms PRIVATE LAB
Slide 27: Business Update
BUSINESS UPDATE 27
Slide 28: Q2 FY 2025
Q2 FY 2025 28
Slide 29: Q2 FY25 Strategy & Brand Highlights
Q2 FY25 STRATEGY & BRAND HIGHLIGHTS We delivered strong second quarter results with earnings per diluted share significantly exceeding expectations, led by our owned brands. DKNY and Karl Lagerfeld collectively grew double-digits and the Donna Karan relaunch has been incredibly successful, in additi
Slide 30: Key Financial Results
Q2 FY25 KEY FINANCIAL RESULTS Three Months Ended July ($ in millions, except per share amounts) 31, 2024 2023 (Unaudited) ● Non-GAAP Net income for the second quarter was $24.2 million, or $0.52 cents per diluted share, compared to $16.4 Net sales $ 645 $ 660 Cost of goods sold 369 383 million, or $
Slide 31: Balance Sheet Highlights
Q2 FY25 BALANCE SHEET HIGHLIGHTS ● Inventory remains in a good position, down approximately 24% ○ We continue to actively manage inventory levels, which are well-aligned with future sales ($ in thousands) ● In August, repaid $400 Million senior secured notes due August 2025 ● Repurchased 1.2 Million
Slide 32: Guidance & Strategy Update
FULL YEAR FISCAL 2025 GUIDANCE & STRATEGY UPDATE “Given our second quarter earnings per diluted share outperformance, we are reaffirming our fiscal year 2025 net sales and, once again, raising our earnings per diluted share outlook. Despite the uncertain macroeconomic environment, we remain optimist
Slide 33: FY 2024
FY 2025 FY 2024 33
Slide 34: Strategic Accomplishments
FISCAL 2024 OPERATING RESULTS STRATEGIC ACCOMPLISHMENTS FY 2024 was an important year for the Company, as we accelerated our long-term priorities and quickly developed new opportunities as we transitioned away from the Calvin Klein and Tommy Hilfiger brands. ● Sales penetration of the brands excludi
Slide 35: Key Financial Results: Full Fiscal Year 2024
FULL FISCAL YEAR 2024 KEY FINANCIAL RESULTS ($ in thousands, except per share amounts) ● FY2024 non-GAAP net income per diluted share increased 42% to $4.04 from $2.85 in the prior fiscal year and was above our guidance o Second highest in company history ● Net sales were $3.1 billion, compared to $
Slide 36: Balance Sheet Highlights: Full Year Fiscal 2024
FULL YEAR FISCAL 2024 BALANCE SHEET HIGHLIGHTS ($ in thousands) ● Inventory decreased 27% to $520 million, from last year’s $709 million o Made strong progress rightsizing higher inventory levels carried over from last year o Inventory levels are now better aligned with future sales ● Further streng
Slide 37: Quote from Morris Goldfarb, Chairman & CEO
“We have grown and evolved significantly over the past 50 years because we lead with an entrepreneurial approach and value relationships. This proven formula will drive G-III as we enter the next phase of our business.” MORRIS GOLDFARG, CHAIRMAN & CEO 37
Slide 38: Appendix
APPENDIX 38
Slide 39: Fiscal 2023 P&L
FISCAL 2023 FISCAL 2023 P&L ($ in thousands, except per share amounts) 39
Slide 40: GAAP to Non-GAAP Reconciliation Results
FISCAL 2023 GAAP TO NON-GAAP RECONCILIATION RESULTS ($ in thousands, except per share amounts) 40
Slide 41: GAAP to Non-GAAP Reconciliation Results
FISCAL 2024 GAAP TO NON-GAAP RECONCILIATION RESULTS ($ in thousands, except per share amounts) Net Income to Adjusted EBITDA For the Year Ended January 31, 2024 Q1 Q2 Q3 Q4 Full Year Net Income $ 3,236 $ 16,438 $ 127,640 $ 28,854 $ 176,168 Asset impairments - - 222 6,536 6,758 Expenses related to Ka
Slide 42: GAAP to Non-GAAP Reconciliation Results
FISCAL 2025 GAAP TO NON-GAAP RECONCILIATION RESULTS ($ in thousands, except per share amounts) Forecasted and Actual GAAP Net Income to Forecasted and Actual Non-GAAP Net Income For the Year Ended January 31, 2025 Actual Actual Forecasted Forcasted Q1 Q2 Q3 Full Year Net Income $ 5,802 $ 24,212 $ 97
Slide 43: G-III Apparel Group
G-Ill Apparel Group
G-III Apparel Group — Q2 FY2025 Earnings Presentation on 6ix