Cadre Holdings, Inc. · NYSE:CDRE
Cadre — Q1 2024 Earnings Presentation
21 slides from Cadre's earnings presentation, May 7, 2024
Slide 1: First Quarter 2024
FIRST QUARTER 2024
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Please note that in this presentation we may use words such as “appears,” “anticipates,” “believes,” “plans,” “expects,” “intends,” “future,” and similar expressions which constitute forward-looking statements within the meaning of the safe harbor provisions of the Private
Slide 3: Today's Presenters
TODAY’S PRESENTERS WARREN KANDERS BRAD WILLIAMS BLAINE BROWERS Chief Executive Officer and President Chief Financial Officer Chairman of the Board 4
Slide 4: Agenda
AGENDA • Q1 Highlights • Business Overview • Financial Summary • Full Year Outlook • Conclusion and Q&A 4
Slide 5: Continued Execution in Q1
CONTINUED EXECUTION IN Q1 Cadre continues to deliver on strategic objectives, generating record quarterly Adj. EBITDA and strong margins Commentary: Pricing Growth: Exceeded target Q1 Mix: − Neutral mix in the quarter, positive product mix offset by portfolio mix Orders Backlog: − As expected, Arm
Slide 6: Long-Term Industry Tailwinds Supporting Sustainable Growth Opportunity
LONG-TERM INDUSTRY TAILWINDS SUPPORTING SUSTAINABLE GROWTH OPPORTUNITY Public Safety Tailwinds Police protection expenditures have continued to trend upward even during previous financial and industrial recessions Major US cities continue to increase police budgets European leaders continue to advoc
Slide 7: Latest Market Trends
LATEST MARKET TRENDS North American • Spend per officer remains stable but police departments still struggling to fill open Law Enforcement positions Geopolitical • Future opportunities to provide safety and survivability equipment—primarily EOD Landscape products—as war in Ukraine de-escalates Supp
Slide 8: Cadre's Key M&A Criteria
CADRE'S KEY M&A CRITERIA CADRE'S KEY M&ACRITERIA Business Leading market position Cost structure where material > labor High cost of substitution Leading and defensible technology Mission-critical tocustomer Strong brand recognition Financial Recurring revenueprofile Asset-light Attractive ROIC Mark
Slide 9: Q1 Financial Results
Q1 Financial Results 9
Slide 10: First Quarter 2024 Highlights
FIRST QUARTER 2024 HIGHLIGHTS Q1 2024 Q4 2023 Q1 2023 NET SALES $137.9M $124.6M $111.7M GROSS MARGIN 41.8%2 39.9% 41.7% $6.9M / $9.6M / $7.0M / NET INCOME $0.18 per $0.25 per $0.19 per diluted share diluted share diluted share ADJUSTED EBITDA 1 $24.5M $20.7M $18.6M ADJUSTED EBITDA MARGIN 1 17.8% 16.
Slide 11: Net Sales and Adjusted EBITDA
NET SALES AND ADJUSTED EBITDA NET SALES ($MM) ADJ. EBITDA1 ($MM) % CAGR % CAGR 19.1% % Y/Y 10.8 % GROWTH % Y/Y GROWTH 23.5% at guidance 16.6% midpoint at guidance midpoint FY 2024 FY 2024 Guidance Guidance Range FY 2023 Range FY 2023 $104M to $482.5M $553M to $85.8M $0.0 $108M FY 2022 $572M FY 2022
Slide 12: Q1 2024 Capital Structure
Q1 2024 CAPITAL STRUCTURE March 31, 2024 (in thousands) Cash and cash equivalents $ 87,052 Debt: Revolver $ — Current portion of long-term debt 15,234 Long-term debt 202,453 Capitalized discount/issuance costs (1,852) Total debt, net $ 215,835 Net debt (Total debt net of cash) $ 128,783 Total debt /
Slide 13: 2024 Management Outlook
2024 MANAGEMENT OUTLOOK 2024 GUIDANCE NET SALES $553M to $572M ADJ. EBITDA $104M to $108M CAPITAL EXPENDITURES $8M to $10M 1. A non-GAAP financial measure. See slide 20 for definitions and reconciliations to the nearest GAAP measures 13
Slide 14: Conclusion
CONCLUSION Continued strong execution in Q1 Ongoing implementation of Cadre operating model Increased Quarterly Net Sales, Gross Margin, Adjusted EBITDA and Adjusted EBITDA Margin Committed to improving gross and Adj. EBITDA margins Continuously focused on M&A opportunities Capitalizing on strong ma
Slide 15: Appendix
APPENDIX 15
Slide 16: Balance Sheet
BALANCE SHEET UNAUDITED (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) March 31, 2024 December 31, 2023 Assets Current assets Cash and cash equivalents $ 87,052 $ 87,691 Accounts receivable, net of allowance for doubtful accounts of $1,087 and $635, respectively 68,107 58,360 Inventories 95,759
Slide 17: Statement of Operations
STATEMENT OF OPERATIONS UNAUDITED (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) Three Months Ended March 31, 2024 2023 Net sales $ 137,860 $ 111,748 Cost of goods sold 80,232 65,130 Gross profit 57,628 46,618 Operating expenses Selling, general and administrative 40,719 35,250 Restructuring and
Slide 18: Statement of Cash Flows
STATEMENT OF CASH FLOWS UNAUDITED (IN THOUSANDS) Year Ended March 31, 2024 2023 Net income $ 6,928 $ 7,002 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 3,942 4,261 Amortization of original issue discount and debt issue costs 149 64 A
Slide 19: Statement of Cash Flows - Continued
STATEMENT OF CASH FLOWS - CONTINUED UNAUDITED (IN THOUSANDS) Year Ended March 31, 2024 2023 Cash Flows From Financing Activities: Proceeds from revolving credit facilities 5,500 — Principal payments on revolving credit facilities (5,500) — Proceeds from term loans 80,000 — Principal payments on term
Slide 20: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION (IN THOUSANDS) Year ended Three Months Ended March 31, LTM December 31, 2023 2024 2023 March 31, 2024 Net income $ 38,641 $ 6,928 $ 7,002 $ 38,567 Add back: Depreciation and amortization 15,737 3,942 4,261 15,418 Interest expense 4,531 1,637 1,641 4,527 Provision for income t
Slide 21: Use of Non-GAAP Measures
USE OF NON-GAAP MEASURES The Company reports its financial results in accordance with U.S. generally accepted accounting principles (“GAAP”). The presentation contains the non-GAAP measures: (i) earnings before interest, taxes, other income or expense, depreciation and amortization (“EBITDA”), (ii)