March 2017 Safe Harbor Certain statements in this presentation that - - PowerPoint PPT Presentation

March 2017

Certain statements in this presentation that are not historical fact may be deemed “forward-looking statements” 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 Summer’s products; and Summer’s 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 Summer’s business with retail customers; the ability of Summer to compete in its industry; Summer’s dependence on key personnel; Summer’s 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 Summer’s 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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Investor Highlights

Leading provider of juvenile products with strong, well- known brands and emerging sub-brands

• Summer - Monitors, Safety, Gear, & Bath
• SwaddleMe - Nursery
• Born Free - Feeding

Positive industry dynamics

• Stabilization of birth rates and 1st child spend are up
• More Millennial parents with higher disposable income
• Baby boomers spending on duplicate equipment for grandparents home

New management

• Enhanced experience across functional areas
• Focus on improving operating performance and continued debt reduction

Expanding revenue potential

• Focus on consumer driven innovation in core categories
• International markets
• Brand protection

Earnings expansion underway

• Streamlined operations
• Exited poorly performing products / licensing arrangements
• Focus on high-margin categories and effective pricing strategies

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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 4

Business Overview

Turnaround Progressing

Streamlined, Focused Operations

• Exited non-core, low-margin areas & licensing

agreements

• Slashed $4M in annual costs
• G&A expenses down 10% versus 2015
• Reduced inventory to lowest levels in recent history
• Greatly improved quality of inventory
• Restructured credit facilities, saving $1M in cash

annually

• Now focused on high-margin, targeted growth

markets

• Continue to drive cash flow
• Further reduce debt and de-lever balance sheet

Summer Infant in Strong Position to Accelerate Top Line Expansion

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Focus on Core Brands & Channel Diversification

Focus on Core Brands

• Reduction or elimination of lower profit

licensed and private label products

• Product innovation focus on Summer and

SwaddleMe brands and sub brands

• Goal of new product introductions each year

representing at least 20% of annual revenue

Customer & Channel Diversification

• Increased focus and growth from e-commerce;

now 30% of sales from 23% in 2015

• Future revenue opportunities identified in

International, emerging sub brands, and new product introductions

• Working with select large retailers to enhance

presence on their websites

• 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

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

• nline 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

Retail Partners

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Worldwide distribution

Toys r Us Dubai

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Award winning Products!

Summer Monitors

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Wide View 2.0

• Large 5” color LCD video display
• Wide view lens technology
• Soft glow night light
• Automatic night vision
• Digital zoom
• Talk back to baby
• Sound lights
• Add up to 4 cameras
• 800ft range
• Adjustable swivel camera
• Table top or wall mountable

Wide view lens allows parent’s to see 4x more

• f baby’s room

Summer Safety

 My Size Potty

• Look and feel of an adult toilet
• Helps ensure a comfortable and confident

transition to the real thing.

• Toilet handle makes a flushing sound
• With built in wipe dispenser
• Exceeding all expectations
• 4.3 stars on Amazon

 Waterfall Baby Bather

• Soothing waterfall feature circulates water to

help clean and warm baby

• Removable bolster to support newborns

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Summer Strollers

In Industry Top Five in 3 Years

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3Dtote

• Convenience stroller with large storage
• XXL expandable storage basket
• Diaper bag hooks on handlebars
• Side & back storage pockets
• Cup holder, baby bottle holders, & toy loops
• 1 hand recline
• Large canopy with peek window
• Compact fold with auto-lock & carry strap
• Smooth glide wheels
• Super padded contoured hand grips
• Holds up to 50lbs



SwaddleMe – 4 Stages of Swaddles

• 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

• Mother & Baby Awards, Best Newborn Sleep

Aid – BRONZE 2010

• She Knows Parenting Awards 2013
• American Baby, BESTS 2013
• Mom’s Choice Awards, SILVER 2015

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

Pop Line – Portable On The Go Products

Pop ‘n Jump is the perfect entertainer for parents and babies on the go! It’s compact, light-weight folding frame comes fully assembled and sets up in seconds.

• Pop ‘n 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

• Pop ‘n 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.

• Pop’n Play Ultimate Playard allows you to create a

safe portable play area for baby. Consumer Digest Best Buy 15

Financials

Gross Margin Growth Year/Year

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December 31, 2016 January 2, 2016 December 31, 2016 January 2, 2016 Net sales 45,531 $ 50,779 $ 194,328 $ 205,804 $ Cost of goods sold 31,233 35,180 132,577 143,854 Gross profit 14,298 $ 15,599 $ 61,751 $ 61,950 $ General and administrative expenses(1) 10,823 10,897 41,292 46,132 Selling expense 3,785 4,485 15,269 17,780 Depreciation and amortization 1,568 2,853 5,011 6,780 Impairment of intangible assets 2,993

• 2,993
• Operating loss

(4,871) $ (2,636) $ (2,814) $ (8,742) $ Interest expense 781 580 2,682 3,333 Loss before taxes (5,652) $ (3,216) $ (5,496) $ (12,075) $ Income tax expense benefit (1,174) (111) (1,174) (3,424) Net loss (4,478) $ (3,105) $ (4,322) $ (8,651) $ Loss per diluted share (0.24) $ (0.17) $ (0.23) $ (0.47) $ Shares used in fully diluted EPS 18,488,342 18,351,914 18,440,436 18,267,596

(1) Includes stock based compensation expense

Three Months Ended Twelve Months Ended

Balance Sheet

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December 31, 2016 January 2, 2016 Cash and cash equivalents $ 999 $ 923 Trade receivables, net 34,137 40,514 Inventory, net 36,140 36,846 Property and equipment, net 9,965 12,007 Intangible assets, net 14,813 18,512 Other assets 5,683 4,336 Total assets $ 101,737 $ 113,138 Accounts payable $ 30,684 $ 29,541 Accrued expenses 7,757 9,584 Current portion of long-term debt 4,500 3,318 Long term debt, less current portion (1) 41,206 48,767 Other long term liabilities 2,770 2,962 Total liabilities 86,917 94,172 Total stockholders’ equity 14,820 18,966 Total liabilities and stockholders’ equity $ 101,737 $ 113,138

Adjusted EBITDA & EPS Reconciliation

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December 31, 2016 January 2, 2016 December 31, 2016 January 2, 2016 Reconciliation of Adjusted EBITDA Net loss (GAAP) (4,478) $ (3,105) $ (4,322) $ (8,651) $ Plus: interest expense 781 580 2,682 3,333 Plus: benefit for income taxes (1,174) (111) (1,174) (3,424) Plus: depreciation and amortization 1,568 2,853 5,011 6,780 Plus: impairment of intangible assets 2,993

• 2,993
• Plus: non-cash stock based compensation expense

88 165 482 865 Plus: permitted add-backs 1,088 1,454 4,934 10,794 Adjusted EBITDA (Non-GAAP) 866 $ 1,836 $ 10,606 $ 9,697 $ Reconciliation of Adjusted EPS Net loss (GAAP) (4,478) $ (3,105) $ (4,322) $ (8,651) $ Plus: permitted add-backs 1,088 1,454 4,934 10,794 Plus: accelerated amortization

• 1,532
• 1,532

Plus: impairment of intangible assets 2,993

• 2,993
• Plus: unamortized financing costs
• 685

Tax impact of items impacting comparability (1,072) (973) (2,322) (4,241) Adjusted Net (loss)/income (Non-GAAP) (1,469) $ (1,092) $ 1,283 $ 119 $ Adjusted (Loss)/Earnings per diluted share (Non-GAAP) (0.08) $ (0.06) $ 0.07 $ 0.01 $ Three Months Ended Twelve Months Ended

Investor Highlights

• Leading Designer &

Supplier of Juvenile Products

• Strong Well-Known

Brands

• Positive Industry

Dynamics

• Experienced

Management Team

• Focused on Core

Strengths: R&D, Leveraging our Brands, and Operational Excellence

• Targeted Growth

Strategies in all Product Categories .

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Use of Non-GAAP Financial Metrics

This presentation includes certain financial information not derived in accordance with generally accepted accounting principles (“GAAP”). 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 Summer’s 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, Summer’s Annual Report on Form 10-K for the year ended December 31, 2016. You can obtain a copy

• f 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 SEC’s website, www.sec.gov.

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Thank You

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