Business
Karat Packaging Reports 2023 Second Quarter Financial Results
-- Sustained Strong Margin Expansion -- CHINO, Calif., Aug. 09, 2023 (GLOBE NEWSWIRE) -- Karat Packaging Inc. (Nasdaq: KRT) (“Karat” or the “Company”), a
About this update from Karat Packaging Inc.
[{"type":"text","content":"-- Sustained Strong Margin Expansion -- CHINO, Calif., Aug. 09, 2023 (GLOBE NEWSWIRE) -- Karat Packaging Inc. (Nasdaq: KRT) (“Karat” or the “Company”), a specialty distributor and manufacturer of environmentally friendly, disposable foodservice products and related items, today announced financial results for its quarter ended June 30, 2023. Second Quarter 2023 Highlights Quarterly net sales of $108.7 million, down 5.3 percent from the prior-year quarter.Gross profit of $41.9 million, up 23.3 percent from the prior-year quarter.Gross margin of 38.5 percent versus 29.6 percent in the prior-year quarter.Net income of $10.7 million, up 48.3 percent from the prior-year quarter.Net income margin of 9.8 percent versus 6.3 percent in the prior-year quarter.Adjusted EBITDA of $21.1 million, up $9.3 million, or 78.6 percent from the prior-year quarter.Adjusted EBITDA margin of 19.4 percent versus 10.3 percent in the prior-year quarter. 2023 Guidance Net sales for the 2023 third quarter expected to decrease 3 to 4 percentage, compared with prior-year period, primarily due to implementation delays by new chain accounts and in opening new warehouses, and lower revenue from logistics services and shipping fees.Net sales for the 2023 fourth quarter expected to increase 10 to 15 percent over the prior year period.Net sales for the 2023 full year expected to decrease by low single digits.Gross margin goal for the 2023 full year: 36 to 37 percent versus 31.2 percent for 2022.Eco-friendly product sales objective for the 2023 full year: 35 percent of total sales, compared with 27 in 2022. “Karat achieved excellent second quarter results, despite net sales being impacted by price reductions and lower revenue from logistics services and shipping charges, as we had anticipated,” said Alan Yu, Chief Executive Officer. “Sales of our core products grew during the quarter, with volume increasing five percent over the prior year period, and we again experienced solid demand for our eco-friendly products. “Gross margin remained at record level, as we continued to implement our strategic initiatives, which include reducing our manufacturing footprint in certain locations, increasing import items and improving inventory management and fill-rates. “We continued to generate strong operating cash flow, and as announced earlier today, our Board of Directors decl...