November 2015 (NYSE: VSI)

Transcription

1 November 2015 (NYSE: VSI) 1

2 Safe Harbor Statements This presentation contains forward-looking statements that are subject to risks and uncertainties. Statements in this presentation that do not constitute historical facts, including, without limitation, statements under the captions The Current Opportunity, The Larger Opportunity, Private Brands The Opportunity, Customer Experience Reinvention, and 2015 Outlook statements regarding introduction of new product offerings, expense savings, store growth, revenue and other statements that are predictive in nature or depend upon or refer to events or conditions or that include words such as outlook, believes, expects, potential, continues, may, will, should, seeks, approximately, predicts, intends, plans, believes, estimates, targets or could, are forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of These forward-looking statements are subject to various risks and uncertainties, many of which are outside our control, including, among others, including the strength of the economy, changes in the overall level of consumer spending, the performance of the Company's products within the prevailing retail environment, trade restrictions, availability of suitable store locations at appropriate terms, the availability of raw materials, compliance with regulations, certifications and best practices with respect to the development, manufacture, sales and marketing of the company s products and other specific factors discussed here and in other releases and public filings made by the company (including Vitamin Shoppe s reports on Forms 10-K and 10-Q filed with the Securities and Exchange Commission). Vitamin Shoppe believes that all forward-looking statements are based on reasonable assumptions when made; however, we caution that it is impossible to predict actual results or outcomes or the effects of risks, uncertainties or other factors on anticipated results or outcomes and that, accordingly, one should not place undue reliance on these statements. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to update these statements in light of subsequent events or developments. Actual results may differ materially from anticipated results or outcomes discussed in any forward-looking statement. Please refer to the Company s annual reports filed on Form 10-K and other filings with the Securities and Exchange Commission as well as recent press releases. These filings can be accessed over the Internet at in the Investor Relations section. 2

3 Latest Financials - 3Q15 Highlights Revenue Drivers Total comparable sales growth of 0.1% E-commerce revenue increased 0.6% Total revenue increased 1.6% Profitability Gross profit margin increases 90 basis points Adjusted earnings per share of $0.52, compared to adjusted $0.47 in 3Q14 Operational Opened 15 stores, closed 1 Balance Sheet and Cash Flow Ending cash balance of $2.0 million Repaid $10 million on line of credit Re-purchased 355,021 shares for total cost of $12.4 million Capital Expenditures of $9.6 million 3

4 Who We Are - Leading Health & Wellness Retailer Nationwide presence 21 consecutive years of positive comparable sales growth 2014 sales of $1.2bn & operating income of $103mm Strong e-commerce presence Attractive value proposition Vertically integrated with June 2014 acquisition of Nutri-Force 4

5 Who is Our Health & Wellness Customer? Health & Wellness customers are on a never-ending journey to improve both overall health & quality of life through nutrition, fitness and supplements They are constantly searching for new and trusted sources of information and solutions that can help them improve their regimens Our primary customer: health & well-being seekers age: % Female - 40% Male optimizers 5

6 Concept Proven Nationwide Concept Proven Nationwide WA 35 OR 9 CA HI 7 NV 92 7 ID 2 UT 3 AZ 12 CO 8 NM 3 SD 1 NE 2 KS 3 OK 3 TX 52 MN 10 IA 3 MO 8 AR 2 7 LA WI MI 6 18 IL IN OH PA VA 5 KY 26 TN 12 MS AL 1 4 NC 22 SC GA FL 71 NY 72 DC DE MD VT ME 2 CT 11 NJ NH MA RI ~748 stores ~50 new stores for Toronto, Canada 3 PUERTO RICO 39 new stores thru September

7 Knowledge-Driven Health Enthusiasts Competitive Advantage Health Enthusiasts Approximately 4,500 Health Enthusiasts nationwide Passion for wellness many have degrees in Nutrition or Physical Therapy We Pay for Knowledge Are trained to provide the highest level of product knowledge to our customers Provide ongoing training for Health Enthusiasts Opportunity for associates to increase base pay Community Outreach Share the Health events 4 times/year Fitness Expos Wellness partner outreach programs 7

8 Historical Performance (2011 adjusted, 52 week) Revenue ($mm) Comparable Store Sales $675 $752 $841 $951 $1,087 $1, % 7.1% 7.4% 8.2% 3.5% 2.8% FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 Operating Income ($mm) Operating Margin $60 $79 $99 $111 $ % 7.9% 9.4% 10.5% 10.1% 8.5% $41 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 8

9 The Opportunity 9

10 The Current Opportunity - VMS Industry Industry exhibits consistent growth through economic cycles E-commerce represents approximately 5% of total industry sales and growing at approximately 10% per year $46.0 $52.0 $26.9 $28.2 $30.2 $32.5 $34.9 $36.7 $ A 2010A 2011A 2012A 2013A 2014A 2015E 2018E 2020E Source: 2015 Nutrition Business Journal $ in billions 10

11 The Larger Opportunity Broader Health and Wellness Total Industry projected to grow from $109 billion to $274 billion Projected to grow at high single-digit rate annually VSI is experiencing strong growth in On-the-Go products $273.9 $26.3 $179.3 CAGR 9.0% $109.7 CAGR 9.7% $195.6 CAGR 6.0% $ A 2015E 2020E VMS Natural & Organic Food Nat & Organic Home/Personal Care Source: 2015 Nutrition Business Journal $ in billions 11

12 Assortment Broad Product Selection We see opportunities to evolve our VMS assortment and improve overall shop-ability and navigation New category brands & innovation particularly strong at the Vitamin Shoppe now reinforced with Brand Blast promos Major push into Adjacent Categories that Offer Accelerated Growth, Strong Margin Opportunity and will attract New Customers Aromatherapy being rolled out across the chain New Protein Pantry available nationwide Expect 1-2 additional categories in 2016 Omni-channel Enables assortment optimization We will complete the remaining capabilities needed to be fully omni-channel BOPUS and aggressive move into Mobile 12

13 Brand Blasts /website in-store 13

14 Private Brands Currently a $200+ million business Have introduced several subbrands over the past 4 years Recent double-digit increases with private brands 14

15 Private Brands The Opportunity Private brands account for approximately 20% of total revenue Private Brands Triple Win Better Value for Customers Create Differentiation Enhance Profitability June 2014 Acquisition of Nutri-Force Each one percentage point increase in private brand penetration contributes between basis points to product margin 15

16 Customer Experience - Reinvention Today: We excel at helping our customers navigate the complex categories in health and wellness while building a trusted relationship Health Enthusiasts We are undertaking research to gain deep insights into customer segmentation and shoppers journeys How we will Respond: Marketing Digital Training Omni-channel 16

17 2015 Outlook (Provided November 4, 2015) 50 ~5% new stores Unit Growth Total Revenue Growth ~Flat Total Comparable Sales Growth $ Earnings per Share 17

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