Q2 FY 2022 EARNINGS WEBCAST NOVEMBER 3, 2021 - elf Beauty
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Q 2 F Y 2 0 2 2 E A R N ING S W EBC AS T
N O V E MB E R 3, 2 0 21
S K I N
As a reminder, this call contains forward-looking statements that are based
on management’s expectations – including those relating to the category
trends and longer-term outlook – and are subject to known and unknown
risks and uncertainties, and therefore, actual results may differ materially.
Important factors that may cause actual results to differ are detailed
in today’s press release and the company’s SEC filings.
In addition, the company’s presentation today includes information
presented on a non-GAAP basis. We refer you to today’s press release for
a reconciliation of the differences between the non-GAAP presentation
and the most directly comparable GAAP measures.
TARANG P. AMIN
CHAIRMAN &
CHIEF EXECUTIVE OFFICER
TODAY’S AGENDA 1 2 Q2 FY 2022 RESU LTS OUTLOOK
+ 27 % $ 92 MILLION Q2 FY 2022 NET SALES
11 CONSECUTIVE QUARTERS OF NET SALES GROWTH
+50%
+27%
+24%
+16%
+11% +10%
+7% +8% +8% +7%
+3%
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
FY 19 FY 20 FY 20 FY 20 FY 20 FY 21 FY 21 FY 21 FY 21 FY 22 FY 22
NET SALES GROWTH BY QUARTER, EXCLUDING E.L.F. STORES (CLOSED IN FEBRUARY 2019)
+ 29 % $ 18 MILLION Q2 FY 2022 ADJUSTED EBITDA
RAISING FY 202 2 NET SALES G UIDA NCE
DI G I TA L C O R E VA L UE A DA PT AT STR EN GT H P R O PO S I T I ON E .L.F. SPE ED
C O L OR C OS M E T I C S C ATEG ORY
S A L E S T R E N D VS . 2 01 9 LE VE LS
8%
2% 2%
0% -2% -1% -1%
-2%
-4%
-8% -8%
-9%
-10%
-12%
-14%
-15% -15%
-15% -17% -17%
-19%
-20%
-23%
-29%
-30%
20
20
20
20
20
20
21
21
21
21
21
B
PR
N
G
CT
EC
N
R
AY
L
PT
JU
FE
A
U
JU
JA
O
SE
D
A
M
M
A
YOY $ SALES GROWTH VS. 2019 LEVELS, NIELSEN XAOC ENDING 9/11/2021, COLOR COSMETICS CATEGORYSAL ES TREND VS . 2019 LEVELS:
TOP 5 COLOR COS MET ICS B RANDS
E.L.F.
30 +27%
22.5
15
7.5
0
MAYBELLINE
-7.5
-2% L’OREAL
-6% REVLON
-15
COVERGIRL -10%
-22.5 -15%
Maybelline L'Oreal Cover Girl Revlon e.l.f.
NIELSEN XAOC LATEST 12 WEEKS ENDING 9/11/2021, COLOR COSMETICS CATEGORY5.6%
MARKET SHARE
+30 BPS
NIELSEN XAOC LATEST 12 WEEKS ENDING 9/11/2021, COLOR COSMETICS CATEGORYSHARE TREND (BPS) VS. 2019 LEVELS:
TOP 5 COLOR COS MET ICS B RANDS
E.L.F.
140 +120
105
70
35
0
-35 MAYBELLINE
-20
-70
L’OREAL REVLON
-105 -60 -70
-140
Maybelline L'Oreal COVERGIRL
Cover Girl Revlon e.l.f.
-140
NIELSEN XAOC LATEST 12 WEEKS ENDING 9/11/2021, COLOR COSMETICS CATEGORYDRIVE DRIVING COST
STEP UP LEADING
BRAND P R O D U C T- S AV I N G S
D I G I TA L I N N O VAT I O N
DEMAND IVITYDRI VE BR AND DEMA ND
MUSIC GAMING
TRANSCENDING
BEAUTY
BOUNDARIES
ORIGINAL CONTENT BRAND-ON-BRAND
CREATION PARTNERSHIPSTEAMED UP WITH TIERRA WHACK TO LAUNCH BIG MOOD MASCARA
#1EYE PR ODUCT ON
ELFCOSMETICS.C OM
BEST MA SCA RA
BEA UTY STEA LPOP CULTURE MOMENT ON JEOPARDY
LAUNCHED A NEW E.L.F. VALUE CAMPAIGN
INTERNAL STUDY
66%
SAID PRICE IS MOST IMPORTANT
WHEN PURCHASING MAKEUP
BOVITZ, INC. (2020, JUNE) MAKEUP CATEGORY ATTITUDES & USAGE STUDY COMMISSIONED BY E.L.F. COSMETICSGEN-Z
#1
AMONG AVERAGE
FAVORITE INCOME TEENS
MAKEUP
#2
BRAND
OVERALL
PIPER SANDLER TAKING STOCK WITH TEENS SURVEY, FALL 2021BEST PERFORMING BEAUTY COMPANY IN 2021, LARGE CAP
~6B PRESS IMPRESSIONS
ALICIA KEYS AT THE MET GALA WITH KEYS SOULCARE
> TRAFFIC TO KEYSSOULCARE.COM +45%BEST BOD Y OIL
CONSUMER INSIGHTS STU DY
BRAND APPEAL IS HIGH
PRODUCT DIFFERENTIATORS
ARE RESONATINGMAJOR STEP U P IN
DIGITALTRIPLE
DI GIT
GROW TH
Q2 FY 2022 DIGITAL CONSUMPTION GROWTH ON 2-YEAR STACK BASIS VS. 2019 LEVELSDIG ITAL COMMERCE PENETR ATION 8% 12 % Q2 Q2 FY 2020 FY 2022
>50%
NEW CONSUMERS
SHOPPING
ELFCOSMETICS.COM
% OF NEW CONSUMERS PURCHASING ON ELFCOSMETICS.COM, Q2 FY 2022E.L.F. COSMETICS BEAUTY SQUAD LOYALTY PROGRAM
>2.6M
MEMBER S
~ 30 %
GR OWTH
~ 70 %
OF SA LES ON ELFCOSMETIC S.COM
BEAUTY SQUAD LOYALTY MEMBERS AS OF 9/30/2021 | Q2 FY 2022 GROWTH IN TOTAL ENROLLMENT VERSUS PYLAUNCHED BEAUTY SQUAD 2.0: RECHARGED LOYALTY PROGRAM
LEADIN G INNOVATIO N
OUR SUPERPOWERS CRUELTY PREMIUM ACCESSIBLE BROAD FREE QUALITY PRICES APPEAL
STRENG TH IN C ORE SEGMENT S
#1 #1 #2 #2 #2
NIELSEN XAOC LATEST 12 WEEKS ENDING 9/11/2021, EXCLUDES PRIVATE LABEL
BRUSHES PRIMERS CONCEALER EYEBROW SPONGES
$ SHARE $ SHARE $ SHARE UNIT SHARE $ SHARESKINCARE F OCU S
SKI NC A RE C ON S U M P T I ON
+22%
+7%
E.L.F. SKINCARE
C AT E G O RY
YOY CONSUMPTION GROWTH. NIELSEN XAOC LATEST 12 WEEKS ENDING 9/11/2021#13
GROWING
AWARENESS
FALL 2021
#17
FALL 2020
PIPER SANDLER TAKING STOCK WITH TEENS SURVEY, FALL 2021LAUNCHED SKINCARE FOR W3LL PEOPLE
W3LL PEOPLE ACCELERATED OUR EFFORTS IN CLEAN BEAUTY
CLEAN BEA UTYDR. RENÉE SNYDER BOAR D-CERTIFIED DER MATOLOGIST CO- F OUNDER, W3L L PEOPLE HELPED CR EATE KEY S SOU LCAR E
E.L.F. COSMETICS
100%
CLEA N
1650+ I NGREDIEN TS
WE DO NOT USE
REFORMULATED
350+ SKUSA D D I N G T O O UR SU PE RPOW ERS PREMIUM ACCESSIBLE CLEAN VEGAN CRUELTY QUALITY PRICES FREE
DRIVING PRODU CTIVITY
CONTINUE TO SEE SHELF SPACE OPPORTUNITIES
E.L.F. COS METICS SPACE EXPANSION FAL L 2 0 2 1 S P R I NG 20 2 2 SPRING 2 0 22
INTERNATION AL
SALES TR END - TOP 10 U.K . MAS S COLOR COSMETICS BRANDS
MAYBELLINE -1%
RIMMEL -14%
L’OREAL -12%
MAX FACTOR -22%
REVOLUTION -30% #8
COLLECTION -9% 2021
REVLON -21%
E.L.F. +30%
+30%
BARRY M -13%
PRIVATE LABEL -24%
-30 -22.5NIELSEN UK,
-15LATEST 52 WEEKS
-7.5 ENDING 7/3/2021
0 7.5 15 22.5 30GLOBAL
RETAIL
STRAT EGY
53W3LL PEOPLE G AINED IT S F IRST IN-LINE PL ACEMENT IN A S UB - SET OF U LTA BEAU TY STORES, SPRING 2022
COST SAVIN GS
GLOBAL CON TAINER IMBALANCE
ABILITY T O OPERATE THROUGH
UNCERTAINTY
FOREGO 2021 HOL IDAY
PROGR AM T O > INVE NTORY
~95% I N S TOCK LEV ELSSTRATEGIC FRAMEWORK
E.L.F. BEAUTY MISSION BEST OF BEA UT Y ACCES SI BLE TO EVERY EYE, LI P A ND FA CE
PORTFOLIO OF C OMPLEMENTARY YET D IST INCT BRANDS
ACCESSIB LE DISTRIBUTION PRESTIGE PRICE
EXC LUSIVE D ISTRIBU TION
~$ 23 AU R
~$17 AUR
~$ 9 AUR
~$5 AU R MASS PRICEWe build brands designed to disrupt industry norms, shape culture and connect communities through positivity, inclusivity and accessibility.
MANDY FIELDS SENIOR VICE PRESIDENT & CHIEF FINANCIAL OFFICER
+ 27 % $ 92 MILLION Q2 FY 2022 NET SALES
63 %
GROSS MARGIN
Q2 FY 2022GR O S S MA R G I N DRIVE RS
M A RG IN
CO ST P R IC E FX TRA NSPORT
AC C RE T I VE
SAVI N G S I N C R E A SE S RATES C OSTS
MIX
Q2 FY 2022ADJ USTED SG&A 51 % 49 % Q2 Q2 FY 2021 FY 2022
MARKETING & DIGITAL
INVESTMENT
15 % 16 %
Q2 Q2
FY 2021 FY 2022
MARKETING & DIGITAL INVESTMENT AS A % OF NET SALES20 %
MARGIN
$ 18M
ADJUSTED EBITDA
Q2 FY 2022AD J US T ED N E T I N C OM E A DJU STED EP S
$ 11M $ 0.21
$ 8M $ 0.16
Q2 Q2 Q2 Q2
FY 2021 FY 2022 FY 2021 FY 2022STRONG LIQUIDIT Y
~ 130
$
MILLION
C AS H O N H A N D + R E VO LV ING C REDIT FA CILITY
Q2 FY 2022C A S H B A L ANC E $ 41 M $ 42 M Q2 FY 2021 Q 2 FY 2 02 2
INVENTORY
$ 77M
$ 64M
Q2 Q2
FY 2021 FY 2022INVENTORY DRIVERS L ON GE R H I GH E R K EY S C ONTINU E D L EA D T R A N S P OR TAT I O N SO ULC A RE & BU SINESS TI ME S COSTS W E LL PE OPLE MO ME NTU M
C A S H P R IO RITIES I NV E S T I N G I N SU P P ORTING F IV E S T R AT E GI C STRATE GIC I M P E RAT I VE S E XTE NSIO NS
NET SALES ADJUSTED EBITDA
+14 % TO 16 % $ 66.5M TO $ 68.0M
FISCAL 2022
OUTLOOK
ADJUSTED EPS ADJUSTED NET INCOME
$ 0.65 TO $ 0.68 $ 36.0M TO $ 37.5MRAISED TOP-LI NE OUTLOOK
DY NAM IC SUP PLY CHAIN
ENVI RONMEN TA D J U S T E D EBITDA
$ 66.5 – $ 68.0
MILLION
FY 2022 OUTLOOKA D J U S T E D EBITDA
+9-11%
YOY
GR OWTH
FY 2022 OUTLOOKM I T I GAT E I M PAC T
COST NON- M A RKE TING
S AV I N GS SG &A S PE ND
FY 2022 COMMENTARYCYCLING +24%
Q3>Q4
Q4 FY21
NET SALES
OUTLOOK
NO HOLIDAY NIELSEN
PROGRAM VOLATILITYI N C L U S IV E . A C C E S S I B LE . CRU E LTY FREE .
S K I NQUEST IONS
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