DECK Deckers Outdoors Jan 2010 Presentation

8/14/2019 DECK Deckers Outdoors Jan 2010 Presentation

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Investor Presentation

12thAnnual ICR XChange

January 2010


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Safe Harbor

We make forward-looking statements in this presentation

which represent our expectations or beliefs about future events

and financial performance. Forward-looking statements are

identifiable by words such as believe, anticipate, expect, intend, plan, will , may and other similar expressions.

In addition, any statements that refer to expectations,

projections or other characterizations of future events or

circumstances are forward-looking statements. Forward-

looking statements are subject to known and unknown risks

and uncertainties, including those described in the Companys

filings with the Securities and Exchange Commission. In

addition, actual results could differ materially from those

suggested by the forward-looking statements, and therefore

you should not place undue reliance on the forward-looking

statements.


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Key Investment Highlights

Operate 5 non-competing lifestyle brands

UGGAustralia / Teva / Simple Shoes / TSUBO

Ahnu

Meaningful domestic growth opportunities

Significant untapped international potential ~ 30% oftotal sales by 2012

Solid earnings, cash flow and strong balance sheet Seasoned management team with strong track record

of success


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Brand

LTM NetSales @9/30/09

87% Accessible luxury comfort

10% Outdoor performance

2% Sustainability with style

1% Style & comfort , Outdoor lifestyle

Brand Development Platform

Grow lifestyle brands into global market leaders.


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2010 Corporate Strategy

Continue to drive UGG Australia growth - transcend

great products to grow a great brandAccelerate international growth

Grow retail business

Continue to develop infrastructure to support growth

Cultivate incubator brands

Explore cash usage - internal investment and/orpotential acquisitions


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UGG Brand: The Premier Brand in Luxury andComfort


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UGG Brand Profile

Lifestyle brand based on accessible comfort andaffordable luxury

Once you discover comfort you dont go back todiscomfort.

Multiple collections of boots and casual footwear for

women, men, and children

Year round consumer demand for product line

Strong retail relationships with key department stores,

specialty stores, and independents

Controlled premium distribution

Accelerating international and retail expansion


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UGG Brand Performance Explosive Growth

- Eleven consecutive years of double-digit growth

Note: Net sales in millions.

Goal

$24 $37

$116$172

$212

$348

$900

2002 2003 2004 2005 2006 2007 2008 2012

$582


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UGG Brand Growth Strategy

Transcend Great Products to Grow a Great

Brand Diversify product line on a foundation of multiple

categories to keep the brand fresh & appeal to a

broader audience Increase retail penetration selectively at premium doors

and Company-owned retail stores

Expand international presence Increase emphasis on marketing


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Tier 1(Innovators)20% of UGG

members

Tier 2(Influencers)39% of UGG

members

Tier 3(Experimenters)

30% of UGGmembers

Tier 4(Followers)11% of UGG

members

Extremely

innovative/

Earlyadopters

Notinnovative/

Late

adopters


High Potential Brand

Quantitative JWT online survey of email database members, 11/09.

UGG Australia Adoption Profile

UGG Brand profiles as an emerging brand with high growth potential


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HowlikelyareyoutorecommendUGGAustraliaproductstosomeoneyouknow?

Answersonascalefrom010

Net Promoter Score*

All-StarsUSAA 82%

Harley-Davidson 81%Costco 79%

UGG 75%Amazon 73%

Chick-Fil-A 72%Ebay 71%

Vanguard 70%SAS 66%

Apple 66%Intuit 58%Cisco 57%

Federal Express 56%Southwest Airl ines 51%American Express 50%



* Net Promoter is a customer loyalty metric developed by Fred Reichheld, Bain & Company, and Satmetrix.


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39% of members;typically enter via

Classic Boot

48% of members;2nd and 3rd items

Slippers, Knits/Fashion Boots

13% of members;Fashion Boots, Accessories

Quantitative JWT online survey of UGGAustralia.com email database members, 11/09.

Key takeaways:

UGG adoption profi le is very balanced, with innovators continuing to play a key role

Net Promoter Score indicates high loyalty and brand potential

New categories are succeeding at keeping the brand fresh and increasing share of closet


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Diversify Product Line

Expand cold weather collection

Grow mens & kids businesses

Continue to expand Spring business

Further develop apparel & accessories collections


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Diversify Product Line


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Expand shop-in-shops to showcase product range

Showcase ~ 100 styles vs. ~ 40 styles at typical account

Drives 35% to 50% increase in sales

Plan to have 100 total domestic shop-in-shops for 2010 vs. 70 in 2009 and

130 total internationally vs. 80 in 2009

Selectively open new premium doors

Harrods in London Aiden in New York

Increase Retail Penetration Wholesale


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Increase Retail Penetration Company owned stores

Currently operate worldwide10 full price stores and 8 outlets allprofitable with accretive margins, fast paybacks and strong sales persquare foot

Premium locations in major metropolitan cities around the world

Plan to open approximately 10 stores per year as appropriate locationsemerge

Manchester Bicester Tokyo



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Expand International Presence

Establish subsidiaries in key developed markets

Establish/maintain third party distributor relationships inless developed markets

Continue to develop subsidiary infrastructure platforms inEurope and Asia

Expand Company owned retail stores

International sales goal ~ 30% of total sales in 2012


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UGG Brand % of International Sales by Country

Global sales would increase 50% if international penetration, in existing markets(excluding China and Russia) , would equal ~ 1/2 of US per capita penetration.


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Increase awareness of the breadth of our product line to keepthe adoption curve dynamic

Expand our brand equity by communicating our authenticheritage and superior product quality

Tap into the phenomenal love for this brand via social media

UGG Brand is in the top 1% of fan pages with 289,000fans on Facebook (despite limited investment to date)

Increase Emphasis on Marketing


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UGG Brand Summary

$900 Million in sales by 2012

Domestic sales growth driven by:

Evolving our product line

Increasing productivity at existing wholesale accounts

Selectively adding new wholesale distribution andgrowing company owned retail

Increasing emphasis on marketing

International growth driven by:

Increasing penetration/direct distribution in key markets Opening new markets

Growing Company owned retail


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Teva Brand Outdoor Performance


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Re-positioned Teva as an iconic adventure water brand forthose who seek performance, camaraderie and freedom

Younger, more active consumer

Year-round product line with superior wet weather technology

Diversified distribution strategy

Improved retail presence and online

More targeted, non-traditional marketing

Teva Brand Growth Strategy

Sales goal - $120 million in 2012


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GROWTHBEST CUSTOMERS

Teva Brand Consumer Profiles

LOYALIST FLIP FLOPFANATIC

GEARJUNKIE

FORMERLYOUTDOORS

CASUALBUYER


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Simple Shoes Sustainability with Style


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Simple Brand Growth Strategy

Introducing a new line of thinking: Consumers no longer have tochoose style over sustainability

Increase awareness and distribution behind brand strategy

Target is youthful, concerned about the environment, andlooking for practical ways to make a positive difference

Branding is more human, playful, optimistic and engaging

Environmental benefits are aspirational but also practical

Product that melds style, comfort and sustainability

Focus on sneakers

Premium distribution strategy and superior service

Sales goal - $35 million by 2012


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TSUBO Brand Style Meets Comfort


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TSUBO Brand Growth Strategy

Reinforce heritage as innovators - the first to create the confluence offashion and athletic shoes providing the comfort of a sneaker +

cutting edge style

Target consumer is the creative class influencer Men and women, live in metropolitan areas, enjoy the

discovery of finding and adopting new fashion brands

Selective distribution in urban boutiques and high enddepartment stores.

2010 is the bridge year back to the original TSUBO heritage anddistinctive voice


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Ahnu Brand Performance Meets Lifestyle


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Ahnu Brand Growth Strategy

Ahnu is a fresh and modern interpretation of the hikingshoe

Lightweight and versatile enough to transition fromtrail to pavement

Infusion of fashion and color Neutral Positioning System (NPS) keeps foot

centered without the heaviness of a traditionalhiking boot

Target consumer is the Outdoor Enthusiast who seeksbalance lifestyle between work and play

Blurring the Lines between Performance andLifestyle


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Ahnu - Performance Meets Lifestyle


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Ahnu - Performance Meets Lifestyle


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FINANCIAL PERFORMANCE


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M i P f


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Margin Performance

1) Operating income results are pro forma, adjusted to exclude litigation expenses (income) of ($0.5)M in 2003 andimpairm ent losses of $15.3 million in 2006 and $35.8 million in 2008.

2) As o ri ginal ly f il ed before r es tatem en t.


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Peer Group Performance Margins

Note: Based on TTM as of most recent reported quarter. Deckers operating margin excludes impairment charges.


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EPS Performance

1) Results are pro form a, adjusted to exclude lit igation expense/(incom e) of ($0.03) in 2003.

2) Results are before restatement.

3) Results are before impairment and restatement.

4) Results are before impairment

Balance Sheet & Cash Flow Highlights: Twelve Months


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Balance Sheet & Cash Flow Highlights: Twelve MonthsEnding

Notes: Amounts in millions

12/31/2006 12/31/2007 12/31/2008 9/30/2009

Cash and short-term investments $99 $168 $195 $126

Total debt $ - $ - $ - $ -

Total equity $210 $299 $385 $421

Total capitalization $210 $299 $385 $421

Cash flow from operations $49 $61 $53 $100

Capital expenditures $6 $6 $22 $16

Depreciation, amortization &accretion $3 $4 $6 $9


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2012 Sales Goal Growth Targets

$1.1 bil lion

UGG Australia: $900 Million

Teva: $120 Million

Simple: $35 Million

TSUBO and Ahnu: $45 million



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Operate 5 non-competing lifestyle brands

Meaningful domestic growth opportunities

Significant untapped international potential ~ 30% oftotal sales by 2012

Solid earnings, cash flow and strong balance sheet

Seasoned management team with strong track record

of success

DECK Deckers Outdoors Jan 2010 Presentation

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