Business
CPI Card Group Inc. Reports Fourth Quarter and Full Year 2023 Results
Fourth Quarter Sales Affected by Cautious Customer Spending as Expected; Fourth Quarter Net Sales Decreased 19%; Net Income Decreased 78%; Adjusted EBITDA
About this update from Cpi Card Group Inc.
[{"type":"text","content":"\nFourth Quarter Sales Affected by Cautious Customer Spending as Expected; Fourth Quarter Net Sales Decreased 19%; Net Income Decreased 78%; Adjusted EBITDA Decreased 27%\n\n\nFull Year Net Sales Decreased 7% to $445 Million; Net Income Decreased 34% to $24 Million; Adjusted EBITDA Decreased 8% to $89 Million\n\n\nCompany Anticipates Gradual Market Recovery in 2024; Financial Outlook Projects Company to Return to Sales Growth for Full Year\n\n\n LITTLETON, Colo.--(BUSINESS WIRE)--\nCPI Card Group Inc. (Nasdaq: PMTS) (“CPI” or the “Company”), a payments technology company and leading provider of credit, debit, and prepaid card and digital solutions, including Software-as-a-Service-based instant issuance, today reported financial results for the fourth quarter and full year ended December 31, 2023 and provided its initial financial outlook for 2024.\n\n\nAs anticipated, fourth quarter sales were similar to third quarter levels as customers generally remained cautious with spending and continued their focus on managing inventory levels. Net sales decreased 19% to $102.9 million in the quarter; net income decreased 78% to $2.7 million, reflecting the impact of the sales decline and an executive retention accrual; and Adjusted EBITDA decreased 27% to $19.9 million. Sales declines also reflect challenging comparisons with the record level in the prior year quarter, when the Company posted net sales growth of 36%.\n\n\nFor the full year, net sales decreased 7% to $444.5 million, net income decreased 34% to $24.0 million, and Adjusted EBITDA decreased 8% to $89.5 million. Cash from operating activities increased 9% to $34.0 million and Free Cash Flow of $27.6 million more than doubled from 2022. The year-end Net Leverage Ratio of 3.1x was relatively consistent with the prior year level.\n\n\nThe Company anticipates cautious customer spending will continue into 2024, with the market gradually recovering over the course of the year. The Company’s initial financial outlook for 2024 projects slight increases in both net sales and Adjusted EBITDA.\n\n\n“Fourth quarter business trends were largely in-line with expectations, as customers continued to prioritize managing inventory levels,” said John Lowe, President and Chief Executive Officer. “We believe card issuance trends to consumers remain healthy and we will continue to focus on gaining ...