Transformation May 2017
Forward Looking Statements and Non-GAAP Information Forward Looking Statements: Certain written and oral statements made by our Company and subsidiaries of our Company foreign sources of supply and foreign manufacturing, and associated operational risks including, may constitute "forward-looking statements" as defined under the Private Securities Litigation but not limited to, long lead times, consistent local labor availability and capacity, and timely Reform Act of 1995. This includes statements made in this presentation. Generally, the words availability of sufficient shipping carrier capacity, risks to the Nutritional Supplements segment "anticipates", "believes", "expects", "plans", "may", "will", "should", "seeks", "estimates", "project", associated with the availability, purity and integrity of materials used in the manufacture of "predict", "potential", "continue", "intends", and other similar words identify forward-looking vitamins, minerals and supplements, the impact of changing costs of raw materials, labor and statements. All statements that address operating results, events or developments that we energy on cost of goods sold and certain operating expenses, the geographic concentration and expect or anticipate will occur in the future, including statements related to sales, earnings per peak season capacity of certain U.S. distribution facilities increases our exposure to significant share results, and statements expressing general expectations about future operating results, shipping disruptions and added shipping and storage costs, our projections of product demand, are forward-looking statements and are based upon our current expectations and various sales and net income are highly subjective in nature and future sales and net income could vary assumptions. We believe there is a reasonable basis for our expectations and assumptions, but in a material amount from such projections, the risks associated with the use of trademarks there can be no assurance that we will realize our expectations or that our assumptions will licensed from and to third parties, our ability to develop and introduce a continuing stream of new prove correct. Forward-looking statements are subject to risks that could cause them to differ products to meet changing consumer preferences, increased product liability and reputational materially from actual results. Accordingly, we caution readers not to place undue reliance on risks associated with the formulation and distribution of vitamins, minerals and supplements, the forward-looking statements. The forward-looking statements contained in this presentation risks associated with potential adverse publicity and negative public perception regarding the use should be read in conjunction with, and are subject to and qualified by, the risks described in the of vitamins, minerals and supplements, trade barriers, exchange controls, expropriations, and Company's Form 10-K for the year ended February 28, 2017 and in our other filings with the other risks associated with U.S. and foreign operations, the risks to our liquidity as a result of SEC. Investors are urged to refer to the risk factors referred to above for a description of these changes to capital market conditions and other constraints or events that impose constraints on risks. Such risks include, among others, our ability to deliver products to our customers in a our cash resources and ability to operate our business, the costs, complexity and challenges of timely manner and according to their fulfillment standards, the costs of complying with the upgrading and managing our global information systems, the risks associated with information business demands and requirements of large sophisticated customers, our relationships with key security breaches, the increased complexity of compliance with new government regulations customers and licensors, our dependence on the strength of retail economies and vulnerabilities covering vitamins, minerals and supplements, the risks associated with product recalls, product to any prolonged economic downturn, our dependence on sales to several large customers and liability, other claims, and related litigation against us, the risks associated with accounting for tax the risks associated with any loss or substantial decline in sales to top customers, expectations positions, tax audits and related disputes with taxing authorities, the risks of potential changes in regarding our recent and future acquisitions or divestitures, including our ability to realize laws in the U.S. or abroad, including tax laws, regulations or treaties, employment and health anticipated cost savings, synergies and other benefits along with our ability to effectively insurance laws and regulations, and laws relating to environmental policy, financial regulation, integrate acquired businesses or separate divested businesses, circumstances which may transportation policy and infrastructure policy along with the costs and complexities of contribute to future impairment of goodwill, intangible or other long-lived assets, the retention and compliance with such laws, and our ability to continue to avoid classification as a controlled recruitment of key personnel, foreign currency exchange rate fluctuations, disruptions in U.S., foreign corporation. We undertake no obligation to publicly update or revise any forward-looking U.K., Euro zone, and other international credit markets, risks associated with weather conditions, statements as a result of new information, future events or otherwise. the duration and severity of the cold and flu season and other related factors, our dependence on 2
HELE Business Overview A leading global consumer products Highly Favorable Business Fundamentals company offering creative solutions for its customers through a strong Powerful Global Brands diversified portfolio of well-recognized and widely-trusted brands in Health & Exciting Growth Drivers Home, Beauty, Housewares and Nutritional Supplements. Highly Attractive Business Economics Housewares Beauty Health & Home Nutritional 27.2% 23.1% 41.2% Supplements of total of total of total 8.5% Net Sales * Net Sales * Net Sales * of total Net Sales * * Based upon FY 17 Consolidated Net Sales Revenue 3
Track Record of Sustained Growth FY17 Highlights $1,546 $1,537 $1,445 • Revenue -0.5%; over base of +7% in FY16 $1,317 • Adj. operating margin +0.4 percentage $1,288 Net Sales points ($ in Millions) • Adj. diluted EPS +7.7% FY 13 FY 15 FY 14 FY 16 FY 17 • Cash flow from operations +22% • Inventory reduction of -4.1% $238 $232 • Debt ratio down to 2.1X from 2.95X end of $220 FY16 Adjusted EBITDA • Made accretive acquisition $195 $190 ($ in Millions) • Returned capital through ~$75MM share FY 13 FY 15 FY 14 FY 16 FY 17 buy-back $6.73 Three Year Performance $6.25 Since New Strategic Plan in FY15 $5.85 • Sales: +16.7% Adjusted $4.47 $4.50 Diluted EPS • Cash from Operations: +48.2% FY 13 FY 14 FY 15 FY 16 FY 17 • Adjusted diluted EPS: +49.6% Throughout this presentation we refer to certain GAAP and non-GAAP measures used by management to evaluate financial performance. Please see explanation of certain terms and measures and reconciliations of Non-GAAP financial measures in the Appendix section. * Source: Helen of Troy 4
Launched New Transformational Strategy in FY 15 Transformation 5
Efficient, Collaborative Operating Structure Transforming from Holding Company to Operating Company FY 2014 Today Improved Performance Corporate & Support Services Supplements Housewares Nutritional & Home Health Beauty Healthcare & Home Housewares Beauty Environment Global Shared Services Platform Strategic Plan Culture 6
Comprehensive Strategy and Operating Model More Efficient and Transformational World Class Strategy Collaborative Brands Operating Structure Improved Performance + + Supplements Housewares Nutritional & Home Health Beauty Global Shared Services Platform Strategic Plan Strategic Plan Culture Culture 7
With Proven Ability to Acquire and Integrate in Attractive Sectors • FY17 Net sales of $1.537 B: built from acquisition and organic growth • Bolting On : success adding new categories, geographies and channels • Tucking In: new brands and adjacencies for additional growth • Right Balance: of integration and independence 2016 2003 2004 2007 2008 2009 2010 2010 2011 2014 2015 Health & Home Beauty Housewares Nutritional Supplements FY17 Net Sales: $355.8 MM FY17 Net Sales: $632.7 MM FY17 Net Sales: $418.1 MM FY17 Net Sales: $130.5 MM 8
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