Investor Presentation June 2012
DISCLAIMER FORWARD LOOKING STATEMENTS Certain information contained in this presentation, particularly information regarding future economic performance, finances, and expectations and objectives of management, constitutes forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and generally contain words such as “believes,” “ exp ects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates” or “anticipates” or similar expressions. O ur forward- looking statements are subject to risks and uncertainties, which may cause actual results to differ materially from those projected or implied by the forward-looking statement. For discussion of some of the important factors that could cause these variations, please read the “Risk Factors” section of the Company’s Annual Report filed on Form 20 -F. Forward-looking statements contained in this presentation are based on assumptions that we have made in light of our management’s experience in the industry as well as our perceptions of historical trends, current conditions, expected future developments and other factors that we believe are appropriate under the circumstances. You should not place undue reliance on forward-looking statements, which speak only as of the date hereof. We do not undertake to update or revise any forward-looking statements after they are made, whether as a result of new information, future events, or otherwise, except as required by applicable law. USE OF NON-GAAP FINANCIAL MEASURES This presentation includes certain measures presented on a basis other than in accordance with generally accepted accounting principles (GAAP), including Adjusted Operating Income, Adjusted Net Income and Adjusted Earnings per Share. These amounts are not an alternative to GAAP. Management believes that these measures provide investors with transparency by helping to illustrate the underlying financial and business trends relating to the Company's results of operations and financial condition and comparability between current and prior periods. Investors are encouraged to review the reconciliation of such measures to the most directly comparable GAAP term, included as an Appendix to this presentation. 2
JET SET LUXURY
INVESTMENT HIGHLIGHTS Rapidly growing global luxury lifestyle brand with compelling growth metrics Design vision led by world-renowned, award-winning designer Poised to take share in growing global accessories product category Proven multi-format retail segment with significant growth opportunity Strong relationships with premier wholesale customers Growing licensing segment Proven and experienced management team 4
MICHAEL KORS COLLECTIONS Introduced in 1981 Introduced in 2004 Positioned to address a younger demographic Reflects the pinnacle of luxury in accessories, in the accessible luxury segment womenswear and menswear Cornerstone of Michael Kors semi-annual Focuses on the accessories market runway shows Establishes the aesthetic authority of the entire brand 5
DESIGN PROCESS Michael Kors leads the overall design direction of the Company He is actively involved in the design process and personally reviews the majority of the Company’s designs Michael Kors is supported by a team of 50 designers Our global reputation enables us to attract and retain top design talent Four collections produced annually Collections are delivered 12 times per year Product is designed to support retail merchandising 6
REVENUE BY PRODUCT Accessories and related merchandise accounted for 75% of total revenue in FY 2012 These products will continue to grow and become an increasingly important driver of global comparable store sales growth Product Mix Product Mix FY 2012 Outlook Women’s Apparel, Women’s Apparel, Men’s Apparel, Men’s Apparel, and Other and Other 15-20% 25% Accessories and Accessories and Related Related Merchandise (1) Merchandise (1) 80-85% 75% (1) Includes handbags, small leather goods, footwear, watches, jewelry, eyewear and fragrances 7
REVENUE BY SEGMENT AND REGION By Region (1) By Segment FYE March FYE March ($ Millions) ($ Millions) 1,302 1,302 10 65 109 1200 1000 803 46 1000 627 Accessories (1) 800 803 1 39 800 508 344 600 25 397 508 1,183 600 20 11 397 187 400 1 114 764 400 610 497 414 200 397 297 200 263 0 0 2009A 2010A 2011A 2012A 2009A 2010A 2011A 2012A Wholesale Retail Licensing North America Europe Japan and Other Regions (1) Total revenue as recognized based on country of origin 8
RAPID GLOBAL GROWTH Adjusted Net Income (1) Total Revenue FYE March FYE March ($ Millions) ($ Millions) 163 1,302 150 1,200 120 900 803 90 73 600 508 60 397 39 300 30 13 0 0 2009A 2010A 2011A 2012A 2009A 2010A 2011A 2012A (1) For Fiscal Year 2012, amounts are adjusted for certain one-time charges. Please refer to Appendix for non-GAAP reconciliation. 9
MANAGEMENT Seasoned management team in the luxury and branded lifestyle sectors with an average of over 25 years experience in the retail industry, including a number of public companies Name Title Years in Industry Years at MK Michael Kors Honorary Chairman, Chief Creative Officer & 33 31 Director John Idol Chairman, Chief Executive Officer & Director 30 9 Joe Parsons Executive Vice President, Chief Financial Officer, 23 8 Chief Operating Officer & Treasurer President – Accessories & Footwear Anna Bakst 22 8 President – Retail Jaryn Bloom 26 7 President – Women’s Gia Castrogiovanni 26 8 President – Canada Debra Margles 27 7 President – Japan Toshi Tashiro 41 2 SVP – Europe Cedric Wilmotte 14 4 SVP – Global Licensing, Marketing Jill Fishman 18 7 SVP – Business Affairs, General Counsel & Lee Sporn 23 8 Secretary 10
MARKETING / PUBLIC RELATIONS STRATEGY A leading advertiser in global fashion publications Catalog published three times per year Print & Online Advertising Our online advertising is expected to account for a large portion of our advertising expense Use of social media to build brand awareness Reinforces Michael Kors’ designer status and high -fashion image Creates excitement around the Michael Kors collection Fashion Shows Global coverage by online and print media Strong relationships with the fashion and trade press Maintains the reputation and designer status profile of the Michael Kors brand Editorial Allows us to market key seasonal fashion products Huge marketing asset unique to Michael Kors Builds awareness of chief designer Project Runway Leverages the popularity of the show to broaden brand awareness Communicates brand image with full product assortment displayed on website – Reinforces the luxury image of our brands E-Commerce – Allows us to communicate directly with customers and drive store traffic 11
GROWTH STRATEGIES Several Key Initiatives Are Underway to Grow Sales Expand North American retail presence – Seek to expand to approximately 400 retail stores in the long-term – Increase size of existing stores Drive outstanding comparable store sales growth – Introduce new product categories such as fashion jewelry to further drive comparable store sales – Expansion of current product categories including logo products and small leather goods Grow North American shop-in-shops at select department stores – Continue to convert selling space into shop-in-shops – Increase number and expand size of existing shop-in-shops Develop European retail and wholesale businesses – Leverage fully-integrated selling offices in London, Milan, Munich, Paris and Madrid to drive continued retail and wholesale expansion – Seek to increase number of stores to approximately 100 locations and $500 million in revenue in the long-term Build out Japanese business – Established wholly-owned Japanese subsidiary in 2010 – Capitalize on existing relationships with top Japanese department stores – Seek to increase number of stores to approximately 100 locations in the long-term 12
RETAIL STORE GROWTH New store growth strategy: – Open new stores in high-traffic street and mall locations, predominately in high-income demographic areas – Adhere to already successful retail store format, which reinforces brand image and generates strong sales per square foot Michael Kors Retail Store Count (1) by Region FYE March 600 100 100 237 400 166 17 106 5 29 74 17 2 191 144 104 74 2009A 2010A 2011A 2012A Long-Term Goal North America Europe Japan (1) Includes concessions 13
SELECT RETAIL LOCATIONS MADISON AVENUE, NEW YORK REGENT STREET, LONDON
Recommend
More recommend
