Cadre Holdings, Inc. · NYSE:CDRE
Cadre — Q1 2022 Earnings Presentation
20 slides from Cadre's earnings presentation, 2022
Slide 1: First Quarter 2022
LADRE HOLDINGS FIRST QUARTER 2022
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Except for historical information, certain matters discussed in this presentation may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include but are not limited to all projections and ant
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 3
Slide 4: Agenda
AGENDA • Q1 Review • 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 in a challenging supply chain and inflationary environment Commentary Pricing Growth: ✅ Significantly exceeded our 1% target above material inflation Adjusted EBITDA ✅ Generated strong EBITDA conversion of 92% in Q1 Convers
Slide 6: Macro Tailwinds Support Long Term Sustainable Growth Opportunity
MACRO TAILWINDS SUPPORT LONG TERM SUSTAINABLE GROWTH OPPORTUNITY Police protection expenditures have continued to trend upward even during previous financial and industrial recessions Major US cities continue to increase police budgets The American Rescue Plan provides $350 billion to hire more poli
Slide 7: Latest Market Trends
LATEST MARKET TRENDS Domestic Law Enforcement • Budgets are healthy but police departments are struggling to fill open positions Geopolitical • Watching customer priorities closely amid War in Ukraine Landscape • Inquiries continue but no large opportunities to provide our safety and survivability e
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 ofsubstitution Leading anddefensible technology Mission-critical tocustomer Strong brandrecognition Financial Recurring revenueprofile Asset-light Attractive ROIC Market
Slide 9: Acquisition of Cyalume Technologies
ACQUISITION OF CYALUME TECHNOLOGIES Over 60 years as a leading manufacturer of chemical light Route / Landing Markings solutions. Preeminent supplier of light sticks, chemi- luminescent ammunition and infra-red devices to US, NATO military forces, and commercial and law enforcement markets. KEYM&A C
Slide 10: First Quarter 2022 Financial Performance
FIRST QUARTER 2022 FINANCIAL PERFORMANCE Q1 2022 Q1 2021 NET SALES $104.4M $110.5M GROSS MARGIN 38.5% 39.8% NET (LOSS) INCOME ($10.2M) / ($0.30) $6.9M / $0.25 per share per share ADJUSTED EBITDA 1 $14.2M $20.2M ADJUSTED EBITDA MARGIN 1 13.6% 18.3% • Achieved pricing growth that significantly exceede
Slide 11: Net Sales and Adjusted EBITDA
NET SALES AND ADJUSTED EBITDA Net Sales / Adj. EBITDA Full Year Guidance for Net Sales / Adj. EBITDA NET SALES ($MM) ADJ. EBITDA1 ($MM) % Y/Y GROWTH % Y/Y 4.8% GROWTH at Guidance 5.0% Midpoint at Guidance Midpoint FY 2022 Guidance Range FY 2022 $444M to $452M Guidance Range $427.3M $72.5M to $77.5M
Slide 12: 1Q22 Capital Structure
1Q22 CAPITAL STRUCTURE March 31, 2022 (in thousands) Cash and cash equivalents $ 9,877 Debt: Revolver $ — Current portion of long-term debt 11,700 Long-term debt 146,599 Capitalized discount/issuance costs (1,938) Total debt, net $ 156,361 Net debt (Total debt net of cash) $ 146,484 Total debt / LTM
Slide 13: 2022 Management Outlook
2022 MANAGEMENT OUTLOOK 2022 GUIDANCE Current Prior NET SALES NET SALES $444M to $452M $434M to $441M Adj. EBITDA Adj. EBITDA $72.5M to $77.5M $70.0M to $75.5M Adj. EBITDA Adj. EBITDA Conversion Conversion 92% to 95% 92% to 95% 13
Slide 14: Conclusion
CONCLUSION Accelerate Organic Revenue Growth Continuously Improve Gross and Adj. EBITDA Margins Pursue M&A Opportunities 14
Slide 15: Appendix
APPENDIX CADRE HOLDINGS
Slide 16: Statement of Operations
STATEMENT OF OPERATIONS UNAUDITED (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) Three Months Ended March 31, 2022 2021 Net sales $ 104,406 $ 110,536 Cost of goods sold 64,217 66,577 Gross profit 40,189 43,959 Operating expenses Selling, general and administrative 53,950 28,051 Restructuring and
Slide 17: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION (IN THOUSANDS) Year ended Three Months Ended March 31, LTM December 31, 2021 2021 2022 March 31, 2022 Net (loss) income $ 12,661 $ 6,864 $ (10,165) $ (4,368) Add back: Depreciation and amortization 13,718 3,539 3,544 13,723 Interest expense 16,425 5,044 1,490 12,871 (Benefit)
Slide 18: Statement of Cash Flows
STATEMENT OF CASH FLOWS UNAUDITED (IN THOUSANDS) Three Months Ended March 31, 2022 2021 Cash Flows From Operating Activities: Net (loss) income $ (10,165) $ 6,864 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 3,544 3,539 Amortization
Slide 19: Statement of Cash Flows - Continued
STATEMENT OF CASH FLOWS - CONTINUED UNAUDITED (IN THOUSANDS) Three Months Ended March 31, 2022 2021 Cash Flows From Financing Activities: Proceeds from revolving credit facilities — 88,593 Principal payments on revolving credit facilities — (88,593) Principal payments on term loans (2,506) (566) Pri
Slide 20: Balance Sheet
BALANCE SHEET UNAUDITED (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) March 31, 2022 December 31, 2021 Assets Current assets Cash and cash equivalents $ 9,877 $ 33,857 Accounts receivable, net of allowance for doubtful accounts of $749 and $645, respectively 52,001 48,344 Inventories 69,401 63,