Cadre Holdings, Inc. · NYSE:CDRE
Cadre — Q2 2024 Earnings Presentation
21 slides from Cadre's earnings presentation, Aug 9, 2024
Slide 1: Second Quarter 2024
ADRE fe) {i 1D) | IN GS SECOND QUARTER 2024
Slide 2: Forward-Looking Statements
2 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 Priva
Slide 3: Today's Presenters
TODAY’S PRESENTERS 4 BRAD WILLIAMS President BLAINE BROWERS Chief Financial Officer WARREN KANDERS Chief Executive Officer and Chairman of the Board
Slide 4: Agenda
4 AGENDA • Q2 Highlights • Business Overview • Financial Summary • Full Year Outlook • Conclusion and Q&A
Slide 5: Continued Execution in Q2
5 CONTINUED EXECUTION IN Q2 Cadre continues to deliver on strategic objectives, generating significant quarterly Adj. EBITDA growth and strong margins Pricing Growth: ✓ Exceeded target Q2 Mix: − Neutral mix in the quarter, positive portfolio mix offset by product mix Orders Backlog: − As expected, E
Slide 6: Long-Term Industry Tailwinds Supporting Sustainable Growth Opportunity
6 LONG-TERM INDUSTRY TAILWINDS SUPPORTING SUSTAINABLE GROWTH OPPORTUNITY Public Safety Tailwinds Nuclear Safety Tailwinds Environmental Safety: Growing DoE environmental liability across multiple sites requiring remediation spend spanning 60+ years National Security: Expanding national defense progr
Slide 7: Latest Market Trends
7 • Police protection expenditures remain stable as recruiting to fill open positions continues • Demand for EOD products after global conflicts de-escalate will lead to future opportunities • While demand for Cadre’s products was strong in Q2, macro consumer weakness remains a concern for businesse
Slide 8: Key M&A Criteria
8 KEY M&A CRITERIA Business Financial Market Leading market position Cost structure where material > labor High cost of substitution Leading and defensible technology Mission -critical to customer Strong brand recognition Recurring revenue profile Asset -light Attractive ROIC Niche market No large -
Slide 9: Q2 Financial Results
9 Q2 Financial Results
Slide 10: Second Quarter 2024 Highlights
10 1. A non-GAAP financial measure. See slide 20 for definitions and reconciliations to the nearest GAAP measures 2. Includes 170 bps of cost related to amortization of inventory step up and intangibles 3. Includes 95 bps of cost related to amortization of inventory step up and intangibles • Q2 net
Slide 11: Net Sales and Adjusted EBITDA Growth
11 NET SALES AND ADJUSTED EBITDA GROWTH 1. A non-GAAP financial measure. See slide 20 for definitions and reconciliations to the nearest GAAP measures NET SALES ($MM) $0.0 $232.8M 2Q23 FY 2022 $457.8M 2022 2023 2024E FY 2023 $482.5M ADJ. EBITDA1 ($MM) $41.4M 2Q23 2022 2023 2024E FY 2024 Guidance Ran
Slide 12: Q2 2024 Capital Structure
12 Q2 2024 CAPITAL STRUCTURE 1. Non-GAAP financial measures. See slide 20 for definitions and reconciliations to the nearest GAAPmeasures June 30, 2024 (in thousands) Cash and cash equivalents $ 105,903 Debt: Revolver $ — Current portion of long-term debt 13,128 Long-term debt 199,885 Capitalized di
Slide 13: 2024 Management Outlook
13 2024 MANAGEMENT OUTLOOK 2024 GUIDANCE NET SALES $571M to $582M ADJ. EBITDA $103M to $109M CAPITAL EXPENDITURES $7M to $9M 1. A non-GAAP financial measure. See slide 20 for definitions and reconciliations to the nearest GAAP measures
Slide 14: Conclusion
CONCLUSION 14 Continued strong execution in Q2 Increased Quarterly Net Sales, Net Income, Adjusted EBITDA and Adjusted EBITDA Margin Ongoing implementation of Cadre operating model Committed to improving gross and Adj. EBITDA margins Capitalizing on strong macro tailwinds driving demand and visibili
Slide 15: Appendix
15 APPENDIX
Slide 16: Balance Sheet
16 BALANCE SHEET UNAUDITED (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) June 30, 2024 December 31, 2023 Assets Current assets Cash and cash equivalents $ 105,903 $ 87,691 Accounts receivable, net of allowance for doubtful accounts of $1,349 and $635, respectively 72,685 58,360 Inventories 95,6
Slide 17: Statement of Operations
17 STATEMENT OF OPERATIONS UNAUDITED (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Net sales $ 144,309 $ 121,087 $ 282,169 $ 232,835 Cost of goods sold 85,659 70,340 165,891 135,470 Gross profit 58,650 50,747 116,278 97,3
Slide 18: Statement of Cash Flows
18 STATEMENT OF CASH FLOWS UNAUDITED (IN THOUSANDS) Six Months Ended June 30, 2024 2023 Cash Flows From Operating Activities: Net income $ 19,495 $ 17,994 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 8,562 8,220 Amortization of origi
Slide 19: Statement of Cash Flows - Continued
19 STATEMENT OF CASH FLOWS - CONTINUED UNAUDITED (IN THOUSANDS) Year Ended June 30, 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 te
Slide 20: 1. Reflects the “Restructuring and transaction costs” line item on our consolidated statement of
20 1. Reflects the “Restructuring and transaction costs” line item on our consolidated statement of operations and comprehensive income, which primarily includes transaction costs composed of legal and consulting fees. In addition, this line item reflects a $1.0 million transaction fee payable to Ka
Slide 21: Use of Non-GAAP Measures
21 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”), (i