Hydrofarm Holdings Group, Inc. · NASDAQ:HYFM
Hydrofarm — Q2 2024 Earnings Presentation
16 slides from Hydrofarm's earnings presentation, Aug 8, 2024
Slide 1: Second Quarter 2024 Earnings Presentation
Second Quar ter 2024 Earn ings Presentat ion August 8, 2024
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements. This presentation contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to known and unknown risks, uncertainties and other important factors that may cause actual results to be materi
Slide 3: Business Overview
Business Over v iew
Slide 4: Second Quarter 2024: Key Profitability Metrics Remain On Track
Second Quarter 2024: Key Profitability Metrics Remain On Track Net Sales on track to achieve our full year outlook • Seven consecutive months of sequential net sales growth Nov’23 through May’24 • Q2 industry demand levels were generally in-line with our internal expectations Positive Adjusted EBITD
Slide 5: 2024 Strategic Priorities
2024 Strategic Priorities Positioning brand and product portfolio for potential industry catalysts Focusing on diverse revenue streams Driving improved sales mix via Proprietary Brands Continue right-sizing our cost structure Further improving our Adjusted EBITDA margin 5 Adjusted Gross Pr
Slide 6: Financial Overview
HYDREFARM Financial Overview
Slide 7: Financial Summary
Financial Summary Adjusted Gross Profit, Adjusted SG&A and Adjusted EBITDA are non-GAAP measures. Please see appendix for reconciliation of non-GAAP to GAAP measures. 7
Slide 8: Solid Q2'24 Performance vs. Challenging Q2'23 Lap
Solid Q2’24 Performance vs. Challenging Q2’23 Lap Adjusted Gross Profit and Adjusted EBITDA are non-GAAP measures. AGPM% refers to 'Adjusted Gross Profit Margin’. Please see appendix for reconciliation of non-GAAP to GAAP measures. Q2 Adjusted Gross Profit Margin % Lapped Q2’23, highest AGPM% quarte
Slide 9: Perspective on our Adjusted Gross Profit Margin Trend
Perspective on our Adjusted Gross Profit Margin Trend Adjusted Gross Profit and Adjusted EBITDA are non-GAAP measures. AGPM% refers to 'Adjusted Gross Profit Margin'. Please see appendix for reconciliation of non-GAAP to GAAP measures. Quarterly Adjusted Gross Profit Margin Sequential Adj Gross Prof
Slide 10: Liquidity and Cash Flow Remain Strong
Liquidity and Cash Flow Remain Strong 'Total Debt' is defined as Term Loan debt principal outstanding plus finance leases and other debt. Net Debt, Liquidity and Free Cash Flow are non-GAAP measures. Please see appendix for reconciliation of non-GAAP to GAAP measures. Cash and cash equivalents $30.3
Slide 11: Debt Details
Revolving Line of Credit $55MM Total Facility Size $0MM Drawn and $20MM (estimated) available as of 6/30/24 Adjusted Term SOFR Rate + grid-based spread Availability varies with borrowing base Matures June 2026 Senior Secured Term Loan $120.2MM in principal outstanding as of 6/30/24 Adj
Slide 12: Reaffirming Fiscal 2024 Outlook on Key Metrics
Net Sales1 Adjusted EBITDA 2 Free Cash Flow 3 R e a f f i r m i n g 2 0 2 4 F u l l Y e a r O u t l o o k Decline low to high teens in % terms Positive Adjusted EBITDA for the Full Year Positive Free Cash Flow for Full Year • Proprietary brand mix % to increase as % of total sales • Improving revenu
Slide 13: Appendix
HYDESFARM Appendix
Slide 14: Hydrofarm's Value Proposition
Source: Company Information Specialty hydroponic retailers Garden centers / retail eCommerce Greenhouse / channel partners Selling to a fragmented customer base… Branded manufacturer and distributor serving the CEA market Adding value within a complex value chain with barriers to entry Hydrofarm’s V
Slide 15: Leadership combines industry & consumer brands know-how
Leadership combines industry & consumer brands know-how Bill Toler Chairman & Chief Executive Officer Prior: Renah Persofsky Vice Chair & Lead Director, Tilray Susan Peters Former SVP HR, General Electric John Lindeman EVP & Chief Financial Officer Prior: Rick Moss Former CFO, Hanesbrands Mark Parke
Slide 16: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures
Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures ($ in thousands) We define Adjusted EBITDA (non-GAAP) as net loss (GAAP) excluding interest expense, income taxes, depreciation, depletion and amortization, stock- based compensation including employer payroll taxes on stoc
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