Investor Presentation August 2018
SAFE SAFE HARBOR HARBOR ST STATE TEME MENT NT This presentation contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “ may, ” “ might, ” “ will, ” “ would, ” “ should, ” “ expect, ” “ plan, ” “ anticipate, ” “ could, ” “ intend, ” “ target, ” “ project, ” “ contemplate, ” “ believe, ” “ estimate, ” “ predict, ” “ likely, ” “ potential ” or “ continue ” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. These forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by the Company and its management, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to, those factors identified in the Company ’ s prospectus in the sections titled “ Risk factors, ” “ Special note regarding forward-looking statements ” and “ Management ’ s discussion and analysis of financial condition and results of operations. ” Nothing in this presentation should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. The Company undertakes no duty to update these forward-looking statements. 2
MANAGEMENT MAN GEMENT PRE PRESE SENTE NTERS RS Larry Enterline CEO Over 40 years in technology businesses - 7 years with FOX Zvi Glasman CFO Over 30 years of experience; 17 years as a CFO - 10 years with FOX Dan Robbins Director, Corporate Marketing & IR Over 20 years of marketing, brand building, technology, and product experience - 9 years with FOX 3
OUR BUSI OUR USINES NESS FO FOX X IS FO FOCU CUSED D ON M MAK AKING ITS CU CUSTOMERS RS ’ VE VEHICLE CLES PERFO RFORM RM BE BETTER We develop purpose-built, vehicle-specific, performance defining solutions that enable our customers ’ vehicles to: • Go Faster • Go Farther • Ride Safer • Last Longer • Have Better Control 4
ASP ASPIRA IRATIO TIONAL L BRAND BRAND Professional Athletes Demand the best product for a competitive edge Weekend Warriors & Enthusiasts Look for the same performance as the professional athletes they admire Diehard Brand Evangelists 5
PE PERFOR RFORMA MANCE NCE DEFINI DEFINING NG PR PRODUC ODUCTS TS THR THROU OUGH GH IN INNO NOVATIVE TIVE TEC TECHN HNOL OLOG OGIES IES Aaron Gwin Rob MacCachren 2011, 2012, 2015, 2016 2014, 2015, & 2016 BAJA 1000 & 2017 Downhill World Champion. 2017 Mint 400 Champion. Cup Series Champion 2018 Baja 500 Champion. Live Valve Electronic Suspension Rusty Butcher F eatured on 2019 Ford F-150 Raptor and Harley Ambassador/Flat Tracker Polaris RZR XP1000 6
DIVE DIVERSI RSITY OF TY OF APP APPLI LICA CATI TIONS ONS AND AND MAR MARKE KETS TS BR BROADENS ADENS OUR OUR POR PORTFOLIO TFOLIO OF OF PR PRODUCTS, ODUCTS, CUST CUSTOMERS, OMERS, AND AND GL GLOB OBAL AL REA REACH CH 7
FO FOX ’ S S CORE CORE CONSUM CONSUMERS ERS Opportunity to capture a greater share of the Performance Enthusiast and General Consumer markets 8
MAR MARQU QUEE EE CUST CUSTOMER OMER RELA RELATIONS TIONSHIP HIPS S 9
A A COMP COMPANY ANY OF OF PASS ASSION IONATE E ENT ENTHUSIAS HUSIASTS TS El CAJON PRODUCTION TECHNICAL MARKETING SPECIALIST DESIGN ENGINEER 10
GR GROWTH WTH OPP OPPOR ORTUNI TUNITI TIES ES CON ONTIN TINUE UE PENETRA PENETRATIO TION N IN IN EX EXISTI ISTING NG VEHI EHICLE LE CATEGORIES TEGORIES Round out our participation across customer product portfolios Continue to focus on growing categories Innovative new product introductions Capitalize on expanding aftermarket opportunity 11
GR GROWTH WTH OPP OPPOR ORTUNI TUNITI TIES ES EXP XPAN AND BRAN BRAND INTO RELEV RELEVANT ANT PE PERFORMANCE DEFI RFORMANCE DEFINING NING ADJ ADJACEN CENCI CIES ES • LIFT KITS • BRAKES • WHEELS • OTHERS Tuscany Acquisition Closed: 12/01/2017 Race Face/Easton Acquisition Closed: 12/12/2014 Sport Truck USA Acquisition Closed: 3/31/2014 12
GR GROWTH WTH OPP OPPOR ORTUNI TUNITI TIES ES NEW VEHICLES • NEW CUSTOMERS • EXPANDED GEOGRAPHIES WHITE SPACE 13
FO FOX FACTOR ORY DELIV LIVERED STRON ONG G 20 2017 17 RESUL ULTS Full Year 2017 Financial Highlights $62M $94M $476M +18% +32% +32% Sales Adjusted Net Income Adjusted EBITDA 14
STRON ONG G SALE LES GR GROWT WTH H FUE FUELE LED BY PR PROD ODUC UCT LE LEADERSHI HIP AND ND NEW EW MA MARKET ETS S $ in millions Sales Growth – Consolidated Sales Growth – By Major Market 3 Year CAGR of 16% 3 Year CAGR (2014-2017) 2017 YoY Growth of 18% 2018 YTD Bike 3-year CAGR of 11% +26% Powered Vehicles 3-year CAGR of 22% Strong sales growth has often exceeded our long term targets. 15
SALES SALES BR BREAKDO EAKDOWN WN BY BY MA MAJOR JOR MA MARKET RKET $ in millions Sales Growth – Bike Sales Growth – Powered Vehicles 3 Year CAGR of 11% 3 Year CAGR of 22% 2017 YoY Growth of 8% 2017 YoY Growth of 31% 2018 YTD +40% 2018 YTD +13% Strong growth in Off-Road capable On-Road Solid growth in existing premium mountain bike markets further strengthened by Off-Road sport / product lines coupled with product line expansion recreational markets and acquisitions has has enabled FOX to exceed our mid to high single enabled FOX to exceed our low double digit long digit long term growth target term growth target 16
LE LEVER VERGI GING NG ST STRENG RENGTH TH IN IN T THE HE AFT AFTERMARKET ERMARKET TO O DRIVE DRIVE OEM SPE OEM SPEC C GR GROWTH WTH AND AND EXP EXPAND AND CUST CUSTOM OMER B ER BASE ASE • FOX typically enters new markets in the aftermarket channel to drive end-consumer YTD 2018 adoption and brand value which often leads to OEM spec wins • Recent acquisitions have been targeted more towards the aftermarket channel as we expand into, and build up new markets to broaden our customer base • Focused on maintaining a healthy balance between the two channels to sustain long term growth and competitive advantage • Fluctuations between quarters and years based on seasonality and timing of product introductions are typical 17
IMPR IMPROVIN ING G PROFIT OFITABILITY ILITY THR HROU OUGH GH STRATEGI GIC IN INITIA ITIATIV IVES $ in millions Adjusted EBITDA (1) Adjusted EBITDA Growth Opportunity exists to achieve a +20% 3 Year CAGR of 19% Adjusted EBITDA margin over next few 2017 YoY Growth of 32% years through continued improvement initiatives 2017 Adjusted EBITDA Margin of 19.7% Initiatives Include: 2018 YTD Growth • Further optimizing bike production in Taichung, 28% Taiwan facility • Powered vehicle production and supply chain optimization in North America • Other process related efficiency initiatives including a new ERP system (1) See appendix for definition. 18
SOLID SOLID LIQU LIQUIDIT IDITY AND AND CAS CASH H GENE GENERA RATIO TION Low liquidity ratios provide flexibility on capital allocation Positive cash flow provides additional flexibility (1) 2018-19 annual capex range is expected to run between 5 - 6% of sales; higher than targeted 3.0% to 4.0% of sales due to near term capacity expansion and strategic initiatives. 19
PR PROFIT OFITABLE ABLE BUSINE USINESS SS MODE MODEL L PR PROVID VIDES ES FUR FURTHE THER R GR GROWTH WTH OPP OPPOR ORTUN TUNITIES ITIES OR OR LEVE LEVERA RAGE GE RED REDUCTIO UCTION • Positive cash flow enables capital allocation Solid Cash Generation opportunities • Organic market growth, technology and brand Invest for Growth • Ongoing Operational and Strategic initiatives • M&A screen for possible future acquisitions • Debt paydown as appropriate Other Uses • Potential share repurchases depending on market conditions 20
WRAP UP WRAP UP Aspirational Brand Performance Defining Products Innovative Technologies SUS SUSTAIN AINAB ABLE LE COM COMPE PETI TITI TIVE VE AD ADVANT ANTAGE GE Diversity of Applications and Markets TO E O ENABLE F ABLE FUT UTURE G URE GROWT WTH A Company of Passionate Enthusiasts Organic and Adjacent Growth Opportunities Proven Track Record of Financial Success 21
Q&A Q&A
APPENDIX APPENDIX
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