The document provides an overview of Summer Infant, Inc., a leading designer and supplier of juvenile products. It summarizes the company's financial turnaround progress, including streamlining operations, exiting underperforming products, and focusing on high-margin categories. It also outlines the company's strategies to improve performance through focusing on core brands, diversifying sales channels, understanding millennial customers, and expanding revenue opportunities internationally. Financial data shows improving gross margins and adjusted EBITDA as the turnaround progresses.
2. Certain statements in this presentation that are not historical fact may be deemed โforward-looking
statementsโ within the meaning of the Private Securities Litigation Reform Act of 1995, and Summer intends
that such forward-looking statements be subject to the safe harbor created thereby. Such forward-looking
statements include statements regarding the market position of Summer; the growth prospects of Summer;
anticipated sales and operating results; the development of new products; demand for Summerโs products;
and Summerโs business strategy. Summer cautions that these statements are qualified by important factors
that could cause actual results to differ materially from those reflected by such forward-looking statements.
Such factors include the concentration of Summerโs business with retail customers; the ability of Summer to
compete in its industry; Summerโs dependence on key personnel; Summerโs reliance on foreign suppliers; the
costs associated with pursuing and integrating strategic acquisitions; the costs associated with protecting
intellectual property; and other risks as detailed in Summerโs Annual Report on Form 10-K for the fiscal year
ended December 31, 2016, and subsequent filings with the Securities and Exchange Commission. The
information contained in this presentation is accurate as of the date set forth on the cover page. Summer
assumes no obligation to update the information contained in this presentation.
Safe Harbor
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3. Investor Highlights
Leading provider of juvenile products with strong, well-
known brands and emerging sub-brands
โข Summer - Monitors, Safety, Gear, & Bath
โข SwaddleMe - Nursery
โข Born Free - Feeding
Positive industry dynamics
โข Stabilization of birth rates and 1st child spend are up
โข More Millennial parents with higher disposable income
โข Baby boomers spending on duplicate equipment for grandparents home
New management
โข Enhanced experience across functional areas
โข Focus on improving operating performance and continued debt reduction
Expanding revenue potential
โข Focus on consumer driven innovation in core categories
โข International markets
โข Brand protection
Earnings expansion underway
โข Streamlined operations
โข Exited poorly performing products / licensing arrangements
โข Focus on high-margin categories and effective pricing strategies
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4. Business Overview
Unique
Positioning to
Meet Moms
Needs
Brand
Key
Categories
Creating a safe, calm feeding
experience
Innovative Care & Safety
products that provide peace
of mind
The authority on safe sleep
A Portfolio of Strong Brands with Focus on Key Parenting Needs
Serving Key Consumer Touch Points in Safety, Safe Sleep, and Feeding
Leveraging Brand Positioning, Breadth of Product Offering & Innovation to
Improve Consumer Relationship
Monitors
Gates
Bath & Potty
Strollers
Travel Accessories
Highchairs/Boosters
Swings/Bouncers
Bottles
Pacifiers
Teethers
Feeding
Electronics
Wearable Blankets
Infant Sleep Aids
Bedding
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Business Overview
5. Turnaround Progressing
Streamlined, Focused Operations
โข Exited non-core, low-margin areas & licensing
agreements
โข Slashed $4M in annual costs
- G&A expenses down 10% versus 2015
โข Reduced inventory to lowest levels in recent history
- Greatly improved quality of inventory
โข Restructured credit facilities, saving $1M in cash
annually
โข Now focused on high-margin, targeted growth
markets
โข Continue to drive cash flow
โข Further reduce debt and de-lever balance sheet
Summer Infant in Strong Position to Accelerate
Top Line Expansion
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6. Focus on Core Brands & Channel Diversification
Focus on Core Brands
โข Reduction or elimination of lower profit
licensed and private label products
โข Product innovation focus on Summer and
SwaddleMe brands and sub brands
โข Goal of new product introductions each year
representing at least 20% of annual revenue
Customer & Channel Diversification
โข Increased focus and growth from e-commerce;
now 30% of sales from 23% in 2015
โข Future revenue opportunities identified in
International, emerging sub brands, and new
product introductions
โข Working with select large retailers to enhance
presence on their websites
โข Working to improve mobile and e-commerce
capabilities on summerinfant.com
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All Other
12%
Baby
Specialty
21%
E-Comm
30%
International
14%
Mass
23%
2016 Sales by Channel
Babies R Us
BuyBuyBaby
Walmart (US)
Target (US)
Amazon, Diapers.com,
all Other US & Int E-Comm
7. Understanding Millennial Moms
59% bought a
product
recommended by
another mom on a
parenting site 44% make
purchases online via
their smartphone
85% of the time
they spend online
is using APPS
9,000 Babies
each day are born
to our Millennial
Mom
Millennials
represent $170
billion in annual
purchasing power
Connected:
Texting, pinning, tweeting,
status updating; she spends
on average 17.4 hours a
week on Social media.
Believe strongly
that recommendations
by other parents (46%)
and experts (35%) is
important
Share Everything/
Share Often:
Online and in-person, she talks
about her product experiences
and solicits feedback from her
peers when planning a
purchase.
7*various sources and Company data
Understanding Millennial Moms
11. Summer Monitors
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Wide View 2.0
โข Large 5โ color LCD video display
โข Wide view lens technology
โข Soft glow night light
โข Automatic night vision
โข Digital zoom
โข Talk back to baby
โข Sound lights
โข Add up to 4 cameras
โข 800ft range
โข Adjustable swivel camera
โข Table top or wall mountable
Wide view lens allows parentโs to see 4x more of
babyโs room
12. Summer Safety
๏ My Size Potty
o Look and feel of an adult toilet
o Helps ensure a comfortable and confident transition
to the real thing.
o Toilet handle makes a flushing sound
o With built in wipe dispenser
o Exceeding all expectations
o 4.3 stars on Amazon
๏ Waterfall Baby Bather
o Soothing waterfall feature circulates water to help
clean and warm baby
o Removable bolster to support newborns
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13. Summer Strollers
In Industry Top Five in 3 Years
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3Dtote
โข Convenience stroller with large storage
โข XXL expandable storage basket
โข Diaper bag hooks on handlebars
โข Side & back storage pockets
โข Cup holder, baby bottle holders, & toy loops
โข 1 hand recline
โข Large canopy with peek window
โข Compact fold with auto-lock & carry strap
โข Smooth glide wheels
โข Super padded contoured hand grips
โข Holds up to 50lbs
14. ๏ SwaddleMe โ 4 Stages of Swaddles
o SwaddleMe knows that when your baby sleeps better,
you sleep better. Our entire line of sleep products has
been expertly designed and tested to keep babies snug,
safe, and comfy every night throughout their first year.
SAFER SLEEP. BRIGHTER DAYS.
SwaddleMe Wearable Blanket
โข Mother & Baby Awards, Best Newborn Sleep
Aid โ BRONZE 2010
โข She Knows Parenting Awards 2013
โข American Baby, BESTS 2013
โข Momโs Choice Awards, SILVER 2015
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15. ๏ Pop Line โ Portable On The Go Products
Pop โn Jump is the perfect entertainer for parents and babies
on the go! Itโs compact, light-weight folding frame comes fully
assembled and sets up in seconds.
โข Pop โn Sit Portable Booster makes feeding time easy with a
removable, BPA free tray, innovative pop and fold set-up, and over
the shoulder carrying bag. Rated 4.8 stars
โข Pop โn Sit High Chair is perfect for dining on-the-go or
even in the patio with your little one. When your baby
needs a place to eat, just pop it open.
โข Popโn Play Ultimate Playard allows you to create a safe
portable play area for baby.
Consumer Digest Best Buy
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16. Awards &
Recognition
Multi-Use Extra Tall Walk-Thru Gate
About
โข A top pregnancy & parenting resource
โข Over 2M followers on social media
โข Babycenter.com receives over 26M unique
monthly visitors (UMV)
BabyCenter
2016 Momsโ Picks Award
Products are voted on by parents as their best-
in-class picks for each category.
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17. Financials
Gross Margin Growth Year/Year
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April 1, 2017 April 2, 2016
Net sales 47,340$ 49,670$
Cost of goods sold 32,051 33,944
Gross profit 15,289$ 15,726$
General and administrative expenses(1) 9,272 10,753
Selling expense 3,911 3,916
Depreciation and amortization 1,056 1,156
Operating income/(loss) 1,050$ (99)$
Interest expense 724 640
Income/(loss) before taxes 326$ (739)$
Income tax provision/(benefit) 156 (406)
Net income/(loss) 170$ (333)$
Income/(loss) per diluted share 0.01$ (0.02)$
Shares used in fully diluted EPS 18,599,386 18,386,572
(1)
Includes stock based compensation expense
Three Months Ended
18. Balance Sheet
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April 1, 2017 December 31, 2016
(unaudited)
Cash and cash equivalents $ 724 $ 999
Trade receivables, net 34,369 34,137
Inventory, net 36,839 36,140
Property and equipment, net 9,811 9,965
Intangible assets, net 14,621 14,813
Other assets 5,288 5,683
Total assets $ 101,652 $ 101,737
Accounts payable $ 28,359 $ 30,684
Accrued expenses 8,724 7,757
Current portion of long-term debt 4,500 4,500
Long term debt, less current portion 42,176 41,206
Other long term liabilities 2,728 2,770
Total liabilities 86,487 86,917
Total stockholdersโ equity 15,165 14,820
Total liabilities and stockholdersโ equity $ 101,652 $ 101,737
19. Adjusted EBITDA & EPS Reconciliation
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April 1, 2017 April 2, 2016
Reconciliation of Adjusted EBITDA
Net income/(loss) (GAAP) 170$ (333)$
Plus: interest expense 724 640
Plus: provision/(benefit) for income taxes 156 (406)
Plus: depreciation and amortization 1,056 1,156
Plus: non-cash stock based compensation expense 85 127
Plus: permitted add-backs 169 1,984
Adjusted EBITDA (Non-GAAP) 2,360$ 3,168$
Reconciliation of Adjusted EPS
Net income/(loss) (GAAP) 170$ (333)$
Plus: permitted add-backs 169 1,984
Tax impact of items impacting comparability (57) (675)
Adjusted Net income/(loss) (Non-GAAP) 282$ 976$
Adjusted Earnings per diluted share (Non-GAAP) 0.02$ 0.05$
Three Months Ended
20. Investor Highlights
โข Leading Designer &
Supplier of Juvenile
Products
โข Strong Well-Known Brands
โข Positive Industry Dynamics
โข Experienced Management
Team
โข Focused on Core
Strengths: R&D,
Leveraging our Brands,
and Operational
Excellence
โข Targeted Growth
Strategies in all Product
Categories
.
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21. Use of Non-GAAP Financial Metrics
This presentation includes certain financial information not derived in accordance with generally accepted
accounting principles (โGAAPโ). This presentation includes references to EBITDA, which is defined as income
before interest and taxes plus depreciation, amortization, deal-related fees and non-cash stock option expense.
Summer believes that the presentation of this non-GAAP measure provides information that is useful to
investors as it indicates more clearly the ability of Summerโs assets to generate cash sufficient to pay interest
on its indebtedness, meet capital expenditure and working capital requirements and otherwise meet its
obligations as they become due. This presentation includes references to adjusted EBITDA and adjusted
earnings per diluted share. Adjusted EBITDA is defined as income before interest and taxes plus depreciation,
amortization, non-cash stock option expense and bank permitted add-backs.
Recipients of the presentation and other interested persons are advised to read all reports and other filings
made by Summer with the Securities and Exchange Commission under the Securities Act of 1933, as amended,
and Securities Exchange Act of 1934, as amended, including, but not limited to, Summerโs Annual Report on
Form 10-K for the year ended December 31, 2016. You can obtain a copy of any of these filings, without charge,
by directing a request to Summer Infant, Inc., 1275 Park East Drive, Woonsocket, RI 02895, or on the Internet at
the SECโs website, www.sec.gov.
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