Traeger, Inc. (NYSE:COOK) Q3 2023 Earnings Conference Call November 8, 2023 4:30 PM ET Company Participants Nick Bacchus - Vice President, Investor Relations Jeremy Andrus - Chief Executive Officer Dom Blosil - Chief Financial Officer Conference Call Participants Peter Benedict - Baird Simeon Siegel - BMO Capital Markets Peter Keith - Piper Sandler Joe Feldman - Telsey Advisory Group Brian McNamara - Cannacord Genuity Operator Hello, everyone, and thank you for joining us today. Welcome to the Traeger Third ...

7 BALANCE SHEET FLEXIBILITY AND LIQUIDITY Lowered Exposure to Rising Rates A/R Facility $6 · Entered into floating-to-fixed interest rate swap agreement on First Lien Term Loan in February 2022 $95 • Agreement provides for a notional amount of $379.2MM, hedging nearly A/R Facility $3 · Fixed base rate at 2.08% Revolving Credit Facility $125 Facility Inventory and Cost Actions Driving Enhanced Liquidity $53 · Liquidity availability has increased by roughly $50MM since 4Q 2022 (4) Total Cash & Equivalents $39 ...

ZU Continuing global economic uncertainty, terrorism and conflicts, political conditions and fiscal challenges in the United States and abroad could result in adverse macroeconomic conditions, including inflation, slower growth or recession. While our revenue increased in the three months ended September 30, 2023, as compared to the prior year period, we believe these challenging macroeconomic pressures and uncertainties have resulted in decreased discretionary consumer spending, particularly for durable go ...

FORM 10-Q For the quarterly period ended June 30, 2023 OR Table of Contents ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number) 1215 E Wilmington Ave, Suite 200 Salt Lake City, Utah 84106 (Address of principal executive offices) (Zip code) Delaware 82-2739741 (801) 701-7180 (Registrants telephone number, including area code) N/A (Former name, former address and former ...

Financial Data and Key Metrics Changes - The company reported a second quarter revenue decline of 14% to $172 million, with grill revenues down 21% to $93 million [20][51] - Consumables revenues were $35 million, down 17% year-over-year, primarily due to lower sales of pellets [21] - Adjusted EBITDA increased to $21 million from $17 million in the prior year, reflecting better-than-expected grill and consumable sales [12][51] - The net loss for the second quarter was $33 million, an improvement from a net loss of $133 million in the same period last year [51] - The company increased its full-year sales guidance to a range of $585 million to $600 million, up from $560 million to $590 million [13][53] Business Line Data and Key Metrics Changes - Grill revenue was negatively impacted by lower unit volumes and a lower average selling price due to pricing adjustments on end-of-life models [48] - Accessories revenues increased by 7% to $43 million, driven by growth in Traeger accessories and MEATER [49] - Consumables sales, excluding a specific customer that introduced a private label offering, showed healthy sell-through trends [21][8] Market Data and Key Metrics Changes - North American revenues declined by 16%, while revenues from the Rest of the World increased by 3% [49] - The company noted that dealer inventories ended the quarter in a substantially more balanced position, allowing for normalized replenishment activity in the second half of the year [46][40] Company Strategy and Development Direction - The company is focused on accelerating brand awareness and penetration in the U.S., with a current household penetration of 3.5% in grill-only households [41] - Product innovation remains a key strategic pillar, with the launch of new grills and consumables aimed at enhancing customer experience [43][18] - The company is expanding its international presence, with efforts to drive productivity and awareness through in-store marketing and product demonstrations [46][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the fluid macroeconomic environment but expressed cautious optimism for a return to growth in the second half of the year [5][47] - The company expects to see the largest year-over-year gain in gross margin in the third quarter, driven by improved fixed cost leverage [54] - Management emphasized the importance of managing expenses and inventory levels to navigate the current environment effectively [69][102] Other Important Information - The company reported a significant increase in user-generated content and media impressions, indicating strong brand engagement [6][7] - The launch of new products, such as the Ironwood grill and Flatrock griddle, received positive consumer reception and media attention [16][44] Q&A Session Summary Question: Can you elaborate on the lower Grill ASP and consumables ASP? - Management indicated that aggressive pricing adjustments were made during the pandemic, and current pricing is being normalized to stimulate volume [27][28] Question: How should we think about inventory levels moving forward? - Management noted that channel inventories are now healthy and aligned with expectations, with a moderate drawdown expected in Q4 [35][68] Question: What is the outlook for the second half of the year? - Management remains cautious but optimistic, expecting a rebound in growth driven by normalized replenishment rates [33][85] Question: How is the Flatrock product performing? - The Flatrock has exceeded expectations, with strong demand leading to plans for increased production [74][94] Question: What is the strategy for consumables in the next 6 to 12 months? - The company is focusing on grocery channel growth for consumables, with positive early indications from recent rollouts [92][71]

Financial Data and Key Metrics Changes - First quarter revenues were $153 million, a decline of 32% year-over-year, but came in towards the higher end of guidance [10][22] - Adjusted EBITDA for the quarter was $22 million, exceeding the high end of guidance by $2 million [10][44] - Net income for the first quarter was $8 million, compared to a net loss of $9 million in the same period last year [43] - Gross profit decreased to $55 million from $83 million year-over-year, with a gross profit margin of 36.2%, down 80 basis points [31][32] Business Line Data and Key Metrics Changes - Grill revenues declined 40% to $90 million, impacted by lower unit volumes due to retailer destocking [22] - Consumables revenues were $30 million, down 24% year-over-year, affected by lower pellet volumes and loss of a customer [22][28] - Accessories revenue decreased 1% to $33 million due to lower unit volumes of Traeger branded accessories [31] Market Data and Key Metrics Changes - North American revenues were down 33%, while revenues from the Rest of World decreased by 13% [31] - Sell-through of grills remained negative compared to the first quarter last year, but was in line with forecasts [12][22] Company Strategy and Development Direction - The company aims to increase household penetration from 3.5% by enhancing brand awareness and improving distribution network productivity [23] - Product innovation is a key focus, with successful launches of the new Ironwood and Flatrock griddle [20][24] - The company is optimizing its pellet manufacturing footprint by consolidating mills to improve efficiency and reduce costs [15][39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year guidance despite current challenges, reiterating revenue expectations between $560 million and $590 million [11][47] - The company anticipates a return to growth in the second half of 2023 as inventory levels normalize and sales trends improve [34][30] - Management noted that the macroeconomic environment remains volatile, but they are prepared to adapt [48] Other Important Information - The company achieved annualized cost savings exceeding $20 million due to restructuring efforts [16][43] - Social media engagement increased, with a 19% growth in followers and a 16% increase in user-generated content [17][18] Q&A Session Summary Question: Can you elaborate on the pellet mills consolidation and its impact? - The consolidation of two pellet mills is part of a broader strategy to optimize costs and improve unit economics for pellets [39][50] Question: How is the engagement and demand for pellets being affected? - Engagement is tracking back to pre-pandemic levels, with consistent usage rates among different consumer cohorts [51][62] Question: What are the expectations for gross margin improvement throughout the year? - Gross margin is expected to improve in the second half of the year as higher-cost inventory is cleared and transportation costs decrease [56][65] Question: How are channel inventories performing relative to expectations? - Channel inventories have improved ahead of plan, positioning the company well for the peak selling season [99][100] Question: What is the strategy for brand awareness and retail partnerships? - The company continues to invest in retail partnerships and community engagement to drive brand awareness and sales [71][92]

Emerging Growth Company Status – The Company is an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012 ("JOBS Act"). Under the JOBS Act, emerging growth companies can delay adopting new or revised financial accounting standards until such time as those standards apply to private companies. The Company has elected to use the extended transition period for complying with the adoption of new or revised accounting standards and as a result of this election, its financial stat ...

UPROXX | --- | --- | --- | --- | --- | --- | --- | |-------------------------|-------|-------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------|-------|-------| | | | | | | | | | Live Like Tyrese Gibson | | | | | | | | | | | | | | | | | | | engadget Traeger's redesigned Ironwood grills pack touchscreen controls and more efficiency The new models have many of the same features ...

PART III 68 Item 10. Directors, Executive Officers and Corporate Governance 68 Item 11. Executive Compensation 70 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 70 Item 13. Certain Relationships and Related Transactions, and Director Independence 70 Item 14. Principal Accountant Fees and Services 71 PART IV 72 Item 15. Exhibits and Financial Statement Schedules 72 Item 16. Form 10-K Summary 75 PART II 50 Item 5. Market for Registrant's Common Equity, ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For transition period from to | --- | |-------------------------------------------------------------| | | | | | Commission File Number 001-40694 | | Traeger, Inc. | | (Exact name ...