Crocs Inc'

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Crocs Inc.

• Group 2
• Jeremy Kliewer, Joe Masloski,
• Tanner Scott

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CROX Overview

• Crocs Inc. makes footwear for men, women, and
  children.
• The unique resin material, croslite, in all of
  their products.
• This material creates a soft, lightweight,
  non-marking, slip- and odor-resistant shoe.
• These properties make the shoes ideal for casual
  wear, as well as boating, hiking, fishing, and
  gardening.

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Recent Headlines

• Crocs Inc. signs with top teams in NASCAR a new
  driver of earnings
• Acquisition of new companies Jibbitz, Fury, and
  Ocean Minded
• Dicks along with other retailers are allocating
  more square footage for Crocs
• 4Q earnings up 236 year over year, 112 million

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International

• Increased doors by 3,000 in the past two months
• 5,900 doors in Europe currently
• Due to international sales Crocs tax rate is
  effectively 32.5
• In 2006 Savings 7.25 Million

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Distribution of Sales
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EPS Relative Valuation
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P/E Relative Valuation
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DCF Valuation

• Assumptions
• Gross Margins 57
• Operating Margins 27
• Tax Rate 32.5

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Risks

• Seasonality
• Decline in popularity
• Competition
• Operational Risk
• F/X Risk

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Recommendation

• Covered Put strategy
• Sell 5 55.00 June 2007 Puts
• Buy 500 Shares
• Costs 25,595 and would be roughly 2 of the
  portfolio

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Options

• Split between Put contracts is 3.50
• Earn of 1,750 off premium, to aid in covering
  the share purchase

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Q1-2007 Earnings Release

• Today Crocs Inc. had their first quarter of 2007
  conference call
• Key Points Made

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?Questions?