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LUVU BRANDS, INC Investor Update Fiscal Year 2026 Summary of financial performance and strategic progress
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SAFE HARBOR / FORWARD LOOKING STATEMENT This investor presentation contains forward-looking information and other forward-looking statements within the meaning of applicable Canadian and/or U.S. securities laws, including our discussion of improvements in the housing market and related markets and the effects of our pricing and other strategies. When used in this Investor Presentation, such forward-looking statements may be identified by the use of such words as “may,” might, “could,” “will,” would,” “should,” “expect,” “believes,” “outlook,” “predict,” “forecast,” “objective,” “remain,” “anticipate,” “estimate,” “potential,” “continue,” “plan,” “project,” “targeting,” or the negative of these terms or other similar terminology. Forward-looking statements involve significant known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Liberator, Inc., or industry results, to be materially different from any future plans, goals, targets, objectives, results, performance or achievements expressed or implied by such forward-looking statements. As a result, such forward-looking statements should not be read as guarantees of future performance or results, should not be unduly relied upon, and will not necessarily be accurate indications of whether or not such results will be achieved. Factors that could cause actual results to differ materially from the results discussed in the forward-looking statements include, but are not limited to, general economic, market and business conditions; levels of residential new construction, residential repair, renovation and remodeling and non-residential building construction activity; competition; our ability to successfully implement our business strategy; our ability to manage our operations including integrating our recent acquisitions and companies or assets we acquire in the future; our ability to generate sufficient cash flows to fund our capital expenditure requirements and to meet our debt service obligations, including our obligations under our senior notes and our senior secured asset-backed credit facility; labor relations (i.e., disruptions, strikes or work stoppages), labor costs, and availability of labor; increases in the costs of raw materials or any shortage in supplies; our ability to keep pace with technological developments; the actions by, and the continued success of, certain key customers; our ability to maintain relationships with certain customers; new contractual commitments; our ability to generate the benefits of our restructuring activities; retention of key management personnel; environmental and other government regulations; limitations on operating our business as a result of covenant restrictions under our existing and future indebtedness, including our senior notes and senior secured asset-based credit facility; and other factors publicly disclosed by the company from time to time. NON-GAAP FINANCIAL MEASURE Adjusted EBITDA represents net income (loss) before interest income, interest expense and financing costs, other expenses, income taxes, depreciation, amortization, and stock-based compensation expense. We have excluded the non-operating item, amortization of debt issuance costs, because it represents a non-cash charge that is not related to the Company’s operations. We have excluded the non-cash expense, stock-based compensation, as it does not reflect the cash-based operations of the Company. Adjusted EBITDA is a non-GAAP financial measure which is not required by or defined under GAAP (Generally Accepted Accounting Principles). The presentation of this financial measure is not intended to be considered in isolation or as a substitute for the financial measures prepared and presented in accordance with GAAP, including the net income of the Company or net cash used in operating activities. Management recognizes that non-GAAP financial measures have limitations in that they do not reflect all of the items associated with the Company’s net income or net loss as determined in accordance with GAAP, and are not a substitute for or a measure of the Company’s profitability or net earnings. Adjusted EBITDA is presented because we believe it is useful to investors as a measure of comparative operating performance and liquidity, and because it is less susceptible to variances in actual performance resulting from depreciation and amortization and non-cash charges for amortization of debt issuance costs and stock-based compensation expense.
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LIBERATOR JAXX Avana Company Background and Mission Founded in 2001 , Luvu Brands focuses on delivering innovative, high-quality lifestyle products to consumers. Our mission centers on enhancing consumer lifestyles through thoughtful design and premium quality. Core Brand Portfolio Luvu Brands operates key brands like Liberator , Avana , and Jaxx , each targeting wellness, comfort, and modular furniture markets with distinct positioning and customer bases. Manufacturing Capabilities Distribution Channels and Market Position Products sell via e-commerce , major online marketplaces, and select retail partners, focusing on premium design and comfort with strong brand differentiation. The 140,000 sq ft Georgia factory supports foam fabrication, textile sewing with lean quality-controlled processes enabling rapid response to customer orders and lean inventory levels. Company Overview
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Product Portfolio Liberator Products for sensuality and intimacy Jaxx Daybeds, sofas and bean bags Avana Yoga, sleep comfort and bed therapy
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FY26 Financial Highlights Net Sales $27.36M ↑ 5.8% vs FY25 Gross Profit $8.61M ↑ 12.8% vs FY25 Gross Margin 31.5% ↑ 200 bps vs FY25 Net Loss $(246)K vs $(448)K net loss in FY25 Key Performance Factors Wholesale up 8% to $19.06M on dropship and international demand; DTC up 2%• Sourcing and lower headcount offset higher Middle East fuel and freight costs• Operating income of $876K vs $(69)K; Adjusted EBITDA up 218% to $1.26M• Net loss reflects a $675K non-cash tax provision tied to the facility lease renewal•
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Balance Sheet Summary Assets (in thousands) Cash & Cash Equivalents $1,199 Accounts Receivable $1,854 Inventories $3,631 Other Assets $4,723 Total Assets $11,407 Liabilities & Equity (in thousands) Current Liabilities $4,897 Long-term Liabilities $4,309 Total Liabilities $9,206 Stockholders' Equity $2,201 Key Balance Sheet Changes (vs June 30, 2025) Cash Position: Up 63% to $1.2M Equity Decline: Down 9% to $2.2M Total Assets: Up 30% to $11.4M Liabilities: Up 45% on facility lease renewal
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FISCAL YEAR ENDED JUNE 30, 2026 OPERATING ACTIVITIES $773K INVESTING ACTIVITIES $(29)K FINANCING ACTIVITIES $(280)K NET CHANGE $464K BEGINNING CASH $735K ENDING CASH $1,199K Cash Flow Waterfall (‘000) Beginning Cash Operating Investing Financing Ending Cash -400 -200 0 200 400 600 800 1,000 1,200 Cash Flow Highlights Strong Operating Performance: Generated $773K in operating cash flow vs $(410)K used in FY25 Liquidity Improvement: Cash position strengthened 63% from $735K to $1.2M Strategic Investments: $29K invested in woodworking equipment to expand production capabilities Positive Free Cash Flow: $744K after capital expenditures Cash Flow Analysis
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Navigating Tariffs, Fuel Costs & Consumer Sentiment Supplier Diversification Sourcing more raw materials from China and India lowers input costs and reduces dependency on any single supplier. Targeted Marketing Strategies Social media influencer and pay-per-click campaigns grew Direct- to-Consumer sales 2% across our three websites. Operational Efficiency Lower headcount, better forecasting and selective price increases offset higher fuel, freight and raw material costs in FY26.
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Cost Reduction Strategies Significant and ongoing reductions in raw material costs are being pursued to improve cost efficiency and enhance profitability. This involves strategic sourcing, renegotiating contracts, and exploring alternative suppliers for key raw materials. Raw Materials Manufacturing ManagementInventory A comprehensive reorganization of manufacturing management, including staff restructuring and process optimization, is underway to streamline operations and reduce overhead costs. Enhanced inventory management practices are being implemented to achieve cost reductions by minimizing holding costs, improving turnover rates, and optimizing stock levels based on demand forecasting and supply chain efficiencies.
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Key Takeaways & Outlook FY26 Performance Revenue grew 5.8% to $27.36M vs prior year• Gross margin expanded to 31.5% from 29.5%• • Operating income of $876K vs $(69)K loss Balance Sheet Strength Cash position improved 63% to $1.2M• Operating cash flow turned positive at $773K• Working capital up to $1.9M from $1.0M• Operational Challenges Higher fuel and freight costs from Middle East conflict• $675K non-cash tax provision drove the net loss• Lease liabilities up after facility lease renewal• Continue strategic cost controls and analysis• Strategic Focus Areas Wholesale dropship and international growth• Margin improvement through cost optimization• Operational efficiency enhancements• Maintaining strong liquidity position• Management Outlook FY26 returned Luvu Brands to positive operating and pre-tax income, with Adjusted EBITDA up 218% to $1.26M. Management will keep its disciplined cost structure, invest in margin expansion and scalable growth, and work to offset rising fuel-related costs.
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OUR LEADERSHIP TEAM Louis Friedman CEO & Founder Chris Knauf CFO Dan Friedman VP of Operations Jordan Friedman VP of eCommerce Danny Griffin VP of Creative Services John Robinson VP of Sales
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For investor relations questions: Christopher Knauf CFO 770-246-6426 chris.knauf@luvubrands.com Additional Information & Contact