Latest news with #DavidMeniane
Yahoo
14-05-2025
- Automotive
- Yahoo
Q1 2025 Carparts.Com Inc Earnings Call
Ryan Lockwood; Chief Financial Officer, Senior Vice President - Finance; Inc David Meniane; Chief Executive Officer, Director; Inc Operator Good afternoon. (Operator Instructions) Please note, this call is being recorded. I would now like to pass the conference over to our host, Ryan Lockwood, Chief Financial Officer. Please go ahead. Ryan Lockwood Hello, everyone, and thank you for joining us for the first quarter 2025 conference call. Joining me today is David Meniane, Chief Executive Officer. Before I turn it over to David to start the call, I have some important disclosures. The prepared remarks contain certain forward-looking statements related to the business under the federal securities laws. Actual results may differ materially from those contained in or implied by these forward-looking statements due to risks and uncertainties associated with the business. For a discussion of the material risks and other important factors that could affect results, please refer to the annual report on Form 10-K and the quarterly reports on Form 10-Q, each as filed with the SEC, both of which can be found on our Investor Relations website. On the call, both GAAP and non-GAAP financial measures will be discussed. A reconciliation of GAAP to non-GAAP financial measures is provided in the press release issued today. With that, I would now like to turn the call over to David. David Meniane Thank you, Ryan, and thanks, everyone, for joining us today. At the outset, let me say that today, we are not going to take questions related to our strategic alternatives process beyond what we announced on March 5. That process is ongoing and being overseen by our Board of Directors with the assistance of financial and legal advisers. Now turning to tariffs. While the current headlines are broadly known, the final rates and applications have not been finalized yet. Our internal team, including leaders from trade compliance, procurement, forecasting, merchandising and pricing are focused on navigating and helping us make decisions. Specific to our exposure, less than one quarter of our private label products are imported from China and approximately two-thirds from Taiwan. Over time, we believe tariffs will raise part prices in the market. Historically, tariff increases have benefited our industry as used car values are expected to rise faster than the vehicle repair costs. Our team is working on mitigating tariff impacts through a variety of actions, including prebuying extra inventory prior to the main tariff implementation, potential cost concessions from vendor partnerships, dynamic pricing adjustments and identifying supply chain and operating expenses optimization. Over the last several weeks, our team conducted a comprehensive review of every product at the vendor level, assessing tariff exposure based on country of origin, material composition and other relevant factors. For products sourced from Taiwan, the majority of our purchases are currently subject to tariffs of approximately 25%. For products from China, current tariff rates range from 55% to 145% and but we are strongly encouraged by the joint announcement made yesterday between the US and China government and look forward to reviewing the details as it relates to its impact on our products and supply chain. We will be monitoring in real-time any changes in trade policy or regulations. Turning to 2025 performance. In the first two months, we saw soft consumer demand very bad weather in many parts of the country on a relative basis, and our company was not immune. In addition, we experienced a significant increase in cost per click rates on search engines, which we believe is a response to the growth of AI models taking share from traditional search, while at the same time, selling prices for parts online fell as retailers try to capture as much demand as possible. While our top line and operating expenses came in line with our expectations, the gross margin compression and advertising spend climate put significant pressure on our profitability in the first quarter. This reinforces how critical it is for us to continue upgrading our customer base with higher income and less price-sensitive customers to diversify our acquisition mix, realigning our business around products to target higher-margin sales adding high-margin fee income, growing customer lifetime value with our mobile app and increasing our focus on wholesale and other commercial opportunities. We continue to believe these are the right bets as we counteract these external pressures. Our first quarter results were disappointing, especially as measured by our profitability. But behind the scenes, we made a lot of progress, and we're seeing momentum with our 2025 plan. For the first 6 weeks of the second quarter, we are seeing revenues up double digits year-over-year on sequentially lower marketing spend. Our focus on repeat customers, mobile app traffic and high-margin fee income are all paying off and we are seeing record levels for all three. While early in the process, we're slowly changing our customer acquisition mix and margin profile to transform our company's profitability. As we continue to scale these initiatives, and grow our assortment, we can leverage our supply chain and fulfillment network, increase operating leverage and return the business to strong profitable growth. On the wholesale side, we have onboarded over 700 new commercial customers and continue to leverage our catalog to target collision shops and mechanics in key markets. During the balance of this fiscal year, we will continue to focus on navigating a dynamic macroeconomic environment, including tariffs and volatile prices. Given the uncertain environment, we are redoubling our focus on growth and profitability, supported by a strong foundation already in place. We're confident that our current investments will help unlock future opportunities and drive stronger financial performance. While certain investments will yield results sooner than others, we remain flexible, continuously refining our approach to achieve sustainable profitability. We have important work ahead and we will be laser-focused on execution. Before covering our financial results, I want to reiterate some of the strategic initiatives that are starting to pay off. Number one, we have scaled and optimized our vertically integrated supply chain with tightly controlled in-house and often proprietary capabilities, leading to an attractive product margin in the mid-50s percent. We have extra capacity in our network, which we can leverage as the business grows and drive more operating leverage. Number two, we continued investing in our fitment-based proprietary catalog, this catalog, which was built and refined over the last 20 years, serves a full assortment across collision, mechanical, private label and branded products with the ability to build custom sets and kits. Today, our catalog contains 83,000 private label SKUs, 1.5 million premium branded SKUs and continues to grow each year. Number three, we continue to be the second largest importer of aftermarket collision parts in the US and the world's number 1 seller on eBay Motors. As a reminder, our collision parts account for approximately two-thirds of our purchases and are primarily sourced from Taiwan, which is not currently subject to the same high tariffs imposed on products made in China. Number four, we fully replatformed our website with a best-in-class mobile-first, fit-specific user experience, which generates 100 million annual visits and served 10 million customers with a new search, product recommendations and fee income capabilities Our best-in-class mobile app is well on the way to 1 million users and now accounts for over 10% of our e-commerce revenue, and growing while allowing for a long-term reduction in our paid versus nonpaid traffic mix and associated customer acquisition costs. And five, our highly profitable wholesale business recently launched same and next-day last mile delivery in both the Texas and North Florida market with a contribution margin up to 3 times higher than e-commerce. We are leveraging real-time integrations with shop management and estimating systems to drive profitable volume to this business. While the first months of the year presented their share of challenges, we made significant progress in key areas that position us well for future growth. I'll now turn it over to Ryan to review our financial results. Ryan Lockwood Thank you, David. In the first quarter, we reported revenues of $147.4 million, down 11% from $166.3 million last year. The decline was primarily driven by inclement weather, softer consumer demand and continued pressures in lighting and mirrors. Gross profit for the quarter was $47.3 million, down 12% compared to prior year. Gross profit margin was 32.1%, down slightly from 32.4% in the prior year period. The decline in gross margin was primarily driven by increased outbound transportation costs. GAAP net loss for the quarter was $15.3 million compared to a loss of $6.5 million in the prior year period, primarily driven by lower gross margins and higher marketing costs. For the first quarter, adjusted EBITDA loss was $6.2 million, down from adjusted EBITDA of $1.1 million in the prior year period, primarily due to soft consumer demand and increased competitive pressure in performance marketing. Turning to the balance sheet. We ended the quarter with $38.5 million of cash and no revolver debt, and we generated $0.3 million of interest income. Earlier this year, in the face of uncertainty, we started proactively investing in inventory ahead of the tariffs to improve the continuity of our supply chain. This works out to about two extra weeks of stop ship cost of goods sold. As a reminder, our inventory has very low obsolescence risk and no risk of spoilage and our pre-freight margins are over 50%. Our inventory balance was $94 million at quarter end versus $90 million at the end of 2024. As of the end of the quarter, our cash position and untapped revolver continue to provide the necessary liquidity to support our business plan. I'll now turn it back over to David for final remarks. David Meniane Thank you, Ryan. Looking ahead, we are confident that the foundation and improvements across our business secured in the last 18 months have set us on a path to achieve long-term sustainable positive net income and adjusted EBITDA. Our priorities in 2025 include: one, continue to expand our product offering to attract new customers and increase average basket size; two, monetize our 100 million annual visits and customer list with high-margin fee income; three, scale our B2B offering with last-mile transportation and higher touch sales in key markets; four, grow our mobile app business to diversify our marketing mix and deliver greater customer lifetime value; five, maintain a strong balance sheet with a focus on managing cash flow and inventory levels while navigating the uncertainty of the tariff environment. We are committed to maximizing long-term shareholder value as we focus on capturing the growing opportunity in front of us within the highly fragmented and underserved $400 billion auto parts market. I would like to thank our global team for their resilience, hard work and commitment as we continue to transform our business. Thank you, everyone, for joining today's call. We'll now turn it back over to the operator. Operator This concludes today's conference call. Thank you for participating. You may now disconnect.
Yahoo
14-05-2025
- Automotive
- Yahoo
CarParts.com Inc (PRTS) Q1 2025 Earnings Call Highlights: Navigating Challenges with Strategic ...
Release Date: May 13, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Inc (NASDAQ:PRTS) has scaled and optimized its vertically integrated supply chain, leading to an attractive product margin in the mid-50s percent. The company has invested in a fitment-based proprietary catalog, which includes 83,000 private label SKUs and 1.5 million premium branded SKUs. Inc (NASDAQ:PRTS) is the second largest importer of aftermarket collision parts in the US and the world's number one seller on eBay Motors. The company has replatformed its website with a mobile-first, fit-specific user experience, generating 100 million annual visits and serving 10 million customers. Inc (NASDAQ:PRTS) has launched a highly profitable wholesale business with same and next-day last mile delivery in key markets, achieving a contribution margin up to three times higher than e-commerce. Inc (NASDAQ:PRTS) reported a revenue decline of 11% in the first quarter, primarily due to inclement weather and softer consumer demand. The company experienced a gross profit margin decline to 32.1%, down from 32.4% in the prior year period, mainly due to increased outbound transportation costs. Inc (NASDAQ:PRTS) reported a GAAP net loss of $15.3 million for the quarter, compared to a loss of $6.5 million in the prior year period. The adjusted EBITDA loss for the first quarter was $6.2 million, down from an adjusted EBITDA of $1.1 million in the prior year period, due to soft consumer demand and increased competitive pressure in performance marketing. The company faced significant pressure on profitability due to gross margin compression and increased advertising spend. Warning! GuruFocus has detected 4 Warning Signs with PRTS. Q: Can you provide more details on how tariffs are impacting your business and what measures you are taking to mitigate these effects? A: David Meniane, CEO, explained that less than one quarter of their private label products are imported from China, with two-thirds from Taiwan. They are taking steps such as prebuying inventory, negotiating cost concessions, adjusting pricing dynamically, and optimizing supply chain and operating expenses to mitigate tariff impacts. Q: How did the first quarter performance compare to your expectations, and what are your plans to address the challenges faced? A: David Meniane noted that the first quarter results were disappointing, particularly in terms of profitability due to soft consumer demand and increased advertising costs. They are focusing on upgrading their customer base, diversifying acquisition mix, and enhancing their mobile app and wholesale opportunities to improve profitability. Q: What progress have you made in your strategic initiatives, and how are they contributing to your business? A: David Meniane highlighted several initiatives, including optimizing their supply chain, expanding their proprietary catalog, and enhancing their e-commerce platform. These efforts have led to improved product margins, increased mobile app usage, and growth in their wholesale business. Q: Can you elaborate on the financial results for the first quarter and the factors affecting them? A: Ryan Lockwood, CFO, reported revenues of $147.4 million, down 11% from the previous year, primarily due to inclement weather and softer demand. Gross profit was $47.3 million, with a slight decline in gross margin due to increased transportation costs. The net loss was $15.3 million, driven by lower margins and higher marketing costs. Q: What are your priorities for 2025, and how do you plan to achieve long-term growth? A: David Meniane outlined priorities such as expanding product offerings, monetizing customer visits with high-margin fee income, scaling B2B offerings, growing the mobile app business, and maintaining a strong balance sheet. These efforts aim to capture opportunities in the $400 billion auto parts market and achieve sustainable growth. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
13-05-2025
- Automotive
- Yahoo
CarParts.com Reports First Quarter 2025 Results
TORRANCE, Calif., May 13, 2025 /PRNewswire/ -- Inc. (NASDAQ: PRTS), a leading eCommerce provider of automotive parts and accessories, and a premier destination for vehicle repair and maintenance needs, is reporting results for the first quarter ended March 29, 2025. First Quarter 2025 Summary vs. Year-Ago Quarter Net sales decreased 11% to $147.4 million. Gross profit of $47.3 million vs. $53.9 million, with gross margin of 32.1%. Net loss was ($15.3) million, or ($0.27) per share, compared to a net loss of ($6.5) million, or ($0.11) per share. Adjusted EBITDA of ($6.2) million vs. $1.1 million. Cash of $38.5 million and no revolver debt. Our mobile app has cumulative net downloads of approximately 900,000. Over 5,000 CarParts+ and Roadside Assistance Memberships sold year to date. Management Commentary "In the first quarter, our top line and operating expenses were in line with our expectations, the gross margin compression and advertising spend climate put significant pressure on our profitability. This reiterates how critical it is for us to continue to upgrade our customer base with higher income and less price sensitive customers as well as diversify our acquisition mix. Realigning our business around products to target higher margin sales, adding high-margin fee income, growing customer lifetime value with our mobile app, and increasing our focus on wholesale and other commercial opportunities. We continue to believe these are the right bets as we counteract these external pressures. For the first 6 weeks of the second quarter, we generated revenues up double digits year-over-year, on sequentially lower marketing spend. Our focus on repeat customers, mobile app traffic, and high-margin fee income are all paying off and we are seeing record levels for all three. While early in the process, we are slowly changing our customer acquisition mix and margin profile to transform our company's profitability." said David Meniane, CEO. First Quarter 2025 Financial Results Net sales in the first quarter of 2025 were $147.4 million, down 11% from $166.3 million in the year-ago quarter. The decline was primarily driven by the impact of soft consumer demand, inclement weather, and continued pressures in lighting and mirrors. Gross profit was $47.3 million in the first quarter compared to $53.9 million in the year-ago quarter, with gross margin decreasing 30 basis points to 32.1%. The decrease was primarily driven by increased outbound freight costs. Total operating expenses in the first quarter were $62.5 million compared to $60.4 million in the year-ago quarter. Operating expense as a percent of net sales increased 6.1% to 42.4% in the first quarter, mainly attributable to unfavorable marketing spend with higher customer acquisition costs. Net loss in the first quarter was ($15.3) million compared to a net loss of ($6.5) million in the year-ago quarter, primarily driven by higher marketing costs and lower gross margin. Adjusted EBITDA in the first quarter was ($6.2) million compared to $1.1 million in the year-ago quarter, primarily due to soft consumer demand and increased competitive pressure in performance marketing. On March 29, 2025, the Company had a cash balance of $38.5 million and no revolver debt, compared to no revolver debt and a $36.4 million cash balance at prior fiscal year-end December 28, 2024. 2025 Outlook The company is currently evaluating various strategic alternatives in response to inbound interest. As a result, we are not providing guidance for 2025. Conference Call CEO David Meniane and CFO Ryan Lockwood will host a conference call today to discuss the results. Date: Tuesday, May 13, 2025Time: 5:00 p.m. Eastern time (2:00 p.m. Pacific time) Webcast: To listen to the live call, please click the link above to access the webcast. A replay of the audio webcast will be archived on the Company's website at About Inc. Inc. is a technology-driven eCommerce company offering over 1 million high-quality automotive parts and accessories. Operating for over 25 years, has established itself as a premier destination for drivers seeking repair and maintenance solutions. Our commitment lies in placing the customer at the forefront of our operations, evident in our easy-to-use, mobile-friendly website and app. With a commitment to affordability and customer satisfaction, simplifies the automotive repair process, aiming to eliminate the uncertainty and stress often associated with vehicle maintenance. Backed by a robust company-operated fulfillment network, we ensure swift delivery of top-quality parts from leading brands to customers across the nation. At our global team is united by a shared vision: Empowering Drivers Along Their Journey. is headquartered in Torrance, California. Non-GAAP Financial Measures Regulation G, and other provisions of the Securities Exchange Act of 1934, as amended, define and prescribe the conditions for use of certain non-GAAP financial information. We provide "Adjusted EBITDA" in this earnings release and on today's scheduled conference call, which are non-GAAP financial measures. Adjusted EBITDA consist of net loss before (a) interest income, net; (b) income tax provision; (c) depreciation and amortization expense; (d) amortization of intangible assets; (e) share-based compensation expense; (f) workforce transition costs; (g) distribution center costs; and (h) strategic alternatives exploration costs. A reconciliation of Adjusted EBITDA to net loss is provided below. The Company believes that these non-GAAP financial measures provide important supplemental information to management and investors. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company's operations that, when viewed with the GAAP results and the accompanying reconciliations to corresponding GAAP financial measures, provides a more complete understanding of factors and trends affecting the Company's business and results of operations. Management uses Adjusted EBITDA as measures of the Company's operating performance because it assists in comparing the Company's operating performance on a consistent basis by removing the impact of stock compensation expense as well as other items that we do not believe are representative of our ongoing operating performance. Internally, these non-GAAP measures are also used by management for planning purposes, including the preparation of internal budgets; for allocating resources to enhance financial performance; and for evaluating the effectiveness of operational strategies. The Company also believes that analysts and investors use these non-GAAP measures as supplemental measures to evaluate the ongoing operations of companies in our industry. These non-GAAP financial measures are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. Management strongly encourages investors to review the Company's consolidated financial statements in their entirety and to not rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. In addition, the Company expects to continue to incur expenses similar to the non-GAAP adjustments described above, and exclusion of these items from the Company's non-GAAP measures should not be construed as an inference that these costs are all unusual, infrequent or non-recurring. Safe Harbor Statement This press release contains statements which are based on management's current expectations, estimates and projections about the Company's business and its industry, as well as certain assumptions made by the Company. These statements are forward looking statements for the purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended and Section 27A of the Securities Act of 1933, as amended. Words such as "anticipates," "could," "expects," "intends," "plans," "potential," "believes," "predicts," "projects," "seeks," "estimates," "may," "will," "would," "will likely continue" and variations of these words or similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to, statements regarding our future operating results and financial condition, our potential growth, our ability to innovate, our ability to gain market share, and our ability to expand and improve our product offerings. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. Important factors that may cause such a difference include, but are not limited to, competitive pressures, our dependence on search engines to attract customers, demand for the Company's products, the online market and channel mix for aftermarket auto parts, the economy in general, increases in commodity and component pricing that would increase the Company's product costs, the operating restrictions in its credit agreement, the weather and any other factors discussed in the Company's filings with the Securities and Exchange Commission (the "SEC"), including the Risk Factors contained in the Company's Annual Report on Form 10–K and Quarterly Reports on Form 10–Q, which are available at and the SEC's website at You are urged to consider these factors carefully in evaluating the forward-looking statements in this release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. Unless otherwise required by law, the Company expressly disclaims any obligation to update publicly any forward-looking statements, whether as result of new information, future events or otherwise. Investor Relations: Ryan Lockwood, CFAIR@ Summarized information for the periods presented is as follows (in millions): Thirteen WeeksEndedThirteen Weeks EndedMarch 29, 2025March 30, 2024Net sales$ 147.38$ 166.29Gross profit$ 47.35$ 53.92 32.1 %32.4 % Operating expense$ 62.49$ 60.44 42.4 %36.3 % Net loss$ (15.28)$ (6.48) (10.4) %(3.9) % Adjusted EBITDA$ (6.23)$ 1.05 (4.2) %0.6 % The table below reconciles net loss to Adjusted EBITDA for the periods presented (in thousands): Thirteen Weeks EndedThirteen Weeks Ended March 29, 2025March 30, 2024 Net loss$ (15,283)$ (6,478) Depreciation & amortization 5,482 4,025 Amortization of intangible assets 13 8 Interest income, net (3) (137) Income tax provision 140 98 EBITDA$ (9,651)$ (2,484) Stock compensation expense$ 2,872$ 2,582 Workforce transition costs(1) — 483 Distribution center costs(2) — 471 Strategic alternatives exploration costs(3) 550 — Adjusted EBITDA$ (6,229)$ 1,052 ________________________ (1) We incurred workforce transition costs, primarily related to severance, as part of our recent workforce reductions. (2) We incurred certain non-recurring costs, primarily overlapping rent expense, attributable to moving to our new Las Vegas, Nevada distribution center. (3) We incurred certain costs, primarily legal and advisor costs, attributable to our ongoing exploration of strategic alternatives. INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE OPERATIONS(Unaudited, In Thousands, Except Per Share Data) Thirteen Weeks Ended March 29,March 30, 20252024 Net sales$ 147,378$ 166,289 Cost of sales (1) 100,031 112,370 Gross profit 47,347 53,919 Operating expense 62,493 60,436 Loss from operations (15,146) (6,517) Other income (expense): Other income, net 260 437 Interest expense (257) (300) Total other income, net 3 137 Loss before income taxes (15,143) (6,380) Income tax provision 140 98 Net loss (15,283) (6,478) Other comprehensive gain: Foreign currency adjustments — 87 Total other comprehensive gain — 87 Comprehensive loss$ (15,283)$ (6,391) Net loss per share: Basic and diluted net loss per share$ (0.27)$ (0.11) Weighted-average common shares outstanding: Shares used in computation of basic and diluted net loss per share 57,343 56,503 _______________________ (1) Excludes depreciation and amortization expense which is included in operating expense. INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS(Unaudited, In Thousands, Except Par Value Data) March 29,December 28, 20252024 ASSETS Current assets: Cash and cash equivalents$ 38,532$ 36,397 Accounts receivable, net 10,211 6,098 Inventory, net 94,207 90,353 Other current assets 6,289 6,020 Total current assets 149,239 138,868 Property and equipment, net 30,123 32,206 Right-of-use - assets - operating leases, net 25,307 26,682 Right-of-use - assets - finance leases, net 9,798 10,765 Other non-current assets 1,988 2,053 Total assets$ 216,455$ 210,574 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable$ 74,593$ 60,365 Accrued expenses 21,859 16,083 Right-of-use - obligation - operating, current 5,884 5,810 Right-of-use - obligation - finance, current 3,273 3,471 Other current liabilities 5,181 4,694 Total current liabilities 110,790 90,423 Right-of-use - obligation - operating, non-current 21,758 23,203 Right-of-use - obligation - finance, non-current 8,079 8,842 Other non-current liabilities 3,058 2,931 Total liabilities 143,685 125,399 Commitments and contingencies (Note 8) Stockholders' equity: Common stock, $0.001 par value; 100,000 shares authorized; 58,295 and 57,454 shares issuedand outstanding as of March 29, 2025 and December 28, 2024 (of which 3,786 are treasurystock) 62 61 Treasury stock (11,912) (11,912) Additional paid-in capital 328,423 325,546 Accumulated other comprehensive income 1,055 1,055 Accumulated deficit (244,858) (229,575) Total stockholders' equity 72,770 85,175 Total liabilities and stockholders' equity$ 216,455$ 210,574 INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited, In Thousands) Thirteen Weeks Ended March 29,March 30, 20252024 Operating activities Net loss$ (15,283)$ (6,478) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization expense 5,482 4,025 Amortization of intangible assets 13 8 Share-based compensation expense 2,872 2,582 Stock awards issued for non-employee director service 11 8 Stock awards related to officers and directors stock purchase plan from payroll deferral — 1 Amortization of deferred financing costs 16 16 Changes in operating assets and liabilities: Accounts receivable (4,112) (1,524) Inventory (3,853) 8,886 Other current assets (269) (1,907) Other non-current assets 35 (504) Accounts payable and accrued expenses 19,975 (1,808) Other current liabilities 488 163 Right-of-use obligation - operating leases - current 189 957 Right-of-use obligation - operating leases - long-term (186) (817) Other non-current liabilities 127 44 Net cash provided by operating activities 5,505 3,652 Investing activities Additions to property and equipment (2,116) (7,431) Net cash used in investing activities (2,116) (7,431) Financing activities Borrowings from revolving loan payable 68 61 Payments made on revolving loan payable (68) (61) Payments on finance leases (954) (1,093) Net proceeds from issuance of common stock for ESPP 96 202 Statutory tax withholding payment for share-based compensation (396) (323) Net cash used in financing activities (1,254) (1,214) Effect of exchange rate changes on cash — 88 Net change in cash and cash equivalents 2,135 (4,905) Cash and cash equivalents, beginning of period 36,397 50,951 Cash and cash equivalents, end of period$ 38,532$ 46,046 Supplemental disclosure of non-cash investing and financing activities: Right-of-use operating asset acquired$ —$ 12,857 Accrued asset purchases$ 526$ 1,621 Share-based compensation expense capitalized in property and equipment$ 294$ 242 Supplemental disclosure of cash flow information: Cash received during the period for income taxes$ —$ (8) Cash paid during the period for interest$ 256$ 300 Cash received during the period for interest$ 259$ 437 View original content to download multimedia: SOURCE Inc.
Yahoo
27-03-2025
- Automotive
- Yahoo
CarParts.com (PRTS) Q4 2024 Earnings Call Transcript
(NASDAQ: PRTS)Q4 2024 Earnings CallMar 25, 2025, 5:00 p.m. ET Prepared Remarks Questions and Answers Call ParticipantsOperator Good afternoon. At this time, all participants will be in a listen-only mode. Please note, this call is being recorded. I would now like to pass the conference over to our host, Tina Mirfarsi, senior vice president of global communications and brand. Please go ahead. Tina Mirfarsi -- Vice President, Global Communications and Culture Hello, everyone, and thank you for joining us for the fourth quarter and fiscal year-end 2024 conference call. Joining me today are David Meniane, chief executive officer; and Ryan Lockwood, chief financial officer. Before I turn it over to David to start the call, I have some important disclosures. The prepared remarks could contain certain forward-looking statements related to the business under the federal securities laws. Actual results may differ materially from those contained in or implied by these forward-looking statements due to risks and uncertainties associated with the business. For a discussion of the material risks and other important factors that could affect results, please refer to the annual report on Form 10-K and quarterly report on Form 10-Q, each as filed with the SEC. Both of which can be found on our investor relations website. On the call, both GAAP and non-GAAP financial measures will be discussed. Before you buy stock in consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $744,133!* Now, it's worth noting Stock Advisor's total average return is 859% — a market-crushing outperformance compared to 167% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of March 24, 2025 A reconciliation of GAAP to non-GAAP financial measures is provided in the press release issued today. With that, I would now like to turn the call over to David. David Meniane -- Chief Executive Officer Thank you, Tina, and thanks, everyone, for joining us today. At the outset, let me say that today, we are not going to comment or take questions related to our strategic alternatives process beyond what we announced on March 5th. That process is being overseen by our board of directors with the assistance of financial and legal advisors. 2024 was an important year in the ongoing transformation of We began the year by refocusing our strategy on three key elements: number one, driving growth and net margin to strengthen financial performance; number two, accelerating efficiency and effectiveness to quickly deliver improved profitability; and number three, achieving sustainable growth with strong long-term free cash flow. The economic environment was challenging for lower-income consumers for all of 2024, leading to a significant pullback in spending and deferral of costs like auto repairs. We faced meaningful price compression in the first part of 2024 and saw selling prices stabilize in the second half. Additionally, our lighting and mirrors business was under substantial pressure due to low cost noncompliant illegal parts imported from China flooding the market. As a result, we worked diligently to realign our business by expanding our product offering to attract a broader consumer base, repricing our products to target higher-margin sales, adding high-margin fee income, growing customer lifetime value with our mobile app, and increasing our focus on B2B and other commercial opportunities. These actions led to a full year 2024 revenues of $589 million, slightly below expectations. However, gross profit of $197 million and gross profit margin of 33.4% for the year was near the upper end of guidance. 2024 was a transformation and investment year as we look to upgrade our customer base and change the long-term margin profile and unit economics of the business. We currently rely on selling parts directly to cost-conscious consumers via expensive paid search and have experienced additional margin pressures from rising outbound transportation costs. By focusing on refining our customer mix, optimizing acquisition strategies, and mitigating cost increases, we aim to deliver greater value to our customers and secure sustainable growth for the business. To address these pressures, we are prioritizing several nonpaid marketing initiatives, such as enhancing our site conversion, and strengthening our search engine optimization, alongside driving mobile app adoption, generating high-margin fee income, expanding our product assortment, and growing our wholesale channel. We believe these efforts will position us to increase our net profit margin and drive long-term growth. Before covering our financial results, I want to take a moment and recap what we have built over the last two years. Number one, we have scaled and optimized our vertically integrated supply chain with tightly controlled in-house capabilities, including sourcing, inventory forecasting, inbound logistics, trade compliance, fulfillment, and reverse logistics, leading to an attractive product margin in the mid-50s percent. Number two, we continue to expand our nationwide direct to consumer fulfillment network and can cover 98% of the population with two-day shipping. We have a unique ability to handle both conveyable and nonconveyable products with capacity for scale. This includes our recently opened semi-automated facility in Las Vegas with 200,000 square feet of space that is now fully operational and processing 25% of our company's volume. Number three, we continued investing in our fitment-based proprietary catalog that took 20 years to build and serves a full assortment across collision, mechanical, private label, and branded products, with the ability to build custom sets and kits. Today, our catalog contains 83,000 private label SKUs, 1.5 million premium branded SKUs, and continues to grow each year. Number four, we continue to be the second-largest importer of aftermarket collision parts in the United States and the world's No. 1 seller on eBay Motors. As a reminder, our collision parts are primarily sourced from Taiwan and account for approximately two-thirds of our purchases that are not currently subject to the high tariffs imposed on products made in China. Number five, we continue to optimize our inventory across our fulfillment network, which was at $90 million at year-end. As discussed in prior calls, our blended pre-freight product margin exceeds 50%, which makes this inventory significantly more valuable at retail prices, especially in an inflationary environment. Number six, we fully replatformed our website with a best-in-class, mobile-first, fit-specific user experience, which generates 100 million annual visits and serves 10 million customers with a new search, product recommendations and fee income capabilities. Our best-in-class mobile app, with over 800,000 users in less than 18 months, now accounts for over 10% of e-commerce revenue and growing, while allowing for a long-term change in our paid versus nonpaid traffic mix. Number seven, our highly profitable B2B business recently launched same and next-day last-mile delivery in the North Florida market with a contribution margin up to three times higher than e-commerce, served by real-time integrations with shop management and estimating systems. Number eight, we've launched a nascent high-margin fee income offerings, which include shipping and product protection, affiliate revenue, and a premium paid membership and roadside assistance with over 3,000 paying members and growing. Over time, we expect this part of our business to help raise our net profit margins. Number nine, we continue to leverage our two exceptional trademarks in and JC Whitney, which allows us to differentiate our private label offerings over time. While 2024 presented its share of challenges, we made significant progress in key areas that position us well for future growth. I'll now turn it over to Ryan to review our financial results. Ryan Lockwood -- Chief Financial Officer Thank you, David. In the fourth quarter, we reported revenues of $133.5 million, down 15% from $156.4 million last year. For the full year, we generated $588.8 million in revenues, down 13% from $675.7 million in 2023, with 2023 representing our highest revenue number ever in customer history. The decline was primarily driven by increased pricing combined with the impact of soft consumer demand, as well as significant pressures in lighting and mirrors. Gross profit for the quarter was $43.4 million, down 16% compared to the prior year. Gross margin was 32.5%, down slightly from 33% in the prior-year period. For the full year, gross profit was within our expected range at $196.7 million, down 14% compared to the prior year. Gross margin was 33.4%, down from 33.9% in 2023. The decline in gross margin was primarily driven by increased outbound transportation costs despite some offset from higher pre-freight gross margin. GAAP net loss for the quarter was $15.4 million compared to a loss of $6.1 million in the prior-year period. For the year, GAAP net loss for the year was $40.6 million compared to a loss of $8.2 million in 2023, primarily driven by lower gross profit. For the fourth quarter, adjusted EBITDA loss was $6.8 million, down from adjusted EBITDA of $1 million in the prior-year period, primarily due to soft consumer demand, price compression, and increased competitive pressure in performance marketing. For the full year, adjusted EBITDA loss of $7.1 million was down from $19.7 million in 2023, primarily impacted by our fourth quarter results. In 2024, we incurred $6.4 million of elevated expenses outside of our normal operations, which we don't expect to reoccur in 2025, including overlapping software expenses related to our digital transformation and one-time costs related to the move of our Las Vegas facility. As David mentioned, we are focused on harvesting return on these strategic investments over the next few years. Turning to the balance sheet. We ended the year with $36.4 million of cash and no revolver debt. We generated $0.3 million of interest income in the fourth quarter and $1.5 million for the full year. Our inventory balance was $90.4 million at year-end versus $128.9 million at the end of 2023. Our cash position and untapped revolver continues to provide the necessary liquidity to support our business plan. As David mentioned above, our company is currently evaluating various strategic alternatives in response to inbound interest. As a result, we are not providing guidance for 2025. I'll now turn it back over to David for final remarks. David Meniane -- Chief Executive Officer Thank you, Ryan. Looking ahead, we are confident that the strong foundation and improvements across our business secured throughout 2024 have set us on a path to achieve long-term, sustainable positive adjusted EBITDA. Our priorities in 2025 include: one, continue to expand our product offering to attract new customers and increase average basket size; number two, monetize our 100 million annual website visits and customer lists with high-margin fee income; number three, scale our B2B offering with last-mile transportation and higher touch sales in key markets; number four, grow our mobile app business to diversify our marketing mix and deliver greater customer lifetime value; and number five, maintain a strong balance sheet with a focus on managing cash flow and inventory levels. We are committed to maximizing long-term shareholder value as we focus on capturing the growing opportunity in front of us within the highly fragmented and underserved $400 billion auto parts market. I would like to thank our global team for their resilience, hard work, and commitment as we continue to transform our business. Thank you, everyone, for joining today's call. We'll now turn it back over to the This concludes today's conference call. Thank you for participating. [Operator signoff] Duration: 0 minutes Tina Mirfarsi -- Vice President, Global Communications and Culture David Meniane -- Chief Executive Officer Ryan Lockwood -- Chief Financial Officer More PRTS analysis All earnings call transcripts This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. (PRTS) Q4 2024 Earnings Call Transcript was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
25-03-2025
- Automotive
- Yahoo
CarParts.com Reports Fiscal Year 2024 Results
TORRANCE, Calif., March 25, 2025 /PRNewswire/ -- Inc. (NASDAQ: PRTS), a leading eCommerce provider of automotive parts and accessories, and a premier destination for vehicle repair and maintenance needs, is reporting results for the fourth quarter and fiscal year ended December 28, 2024. Fiscal Year 2024 Summary vs. Fiscal Year 2023 Net sales decreased 13% to $588.8 million. Gross profit of $196.7 million vs. $229.4 million, with gross margin of 33.4%. Net loss was ($40.6) million, or ($0.71) per share, compared to a net loss of ($8.2) million, or ($0.15) per share. Adjusted EBITDA of ($7.1) million vs. $19.7 million. Cash of $36.4 million and no revolver debt. Our mobile app has cumulative net downloads of over 800,000, more than double the number from the beginning of the year. New semi-automated Las Vegas distribution center fully operational and handling 25% of company volume. Launched a fully re-platformed website featuring an AI based search solution and machine learning based product recommendations. Launched CarParts+ a paid membership that includes roadside assistance and other benefits. Fourth Quarter 2024 Summary vs. Year-Ago Quarter Net sales decreased to $133.5 million, down 15% year-over-year. Gross profit of $43.4 million vs. $51.6 million, with gross margin of 32.5%. Net loss was ($15.4) million, or ($0.27) per share, compared to a net loss of ($6.1) million, or ($0.11) per share. Adjusted EBITDA of ($6.8) million vs. $1.0 million. Management Commentary "2024 was an important year in the ongoing transformation of We began the year by refocusing our strategy on three key elements: number one, driving gross and net margin to strengthen financial performance; number two, accelerating efficiency and effectiveness to quickly deliver improved profitability; and number three, achieving sustainable growth with strong long-term free cash flow. The economic environment was challenging for lower income consumers for all of 2024, leading to a significant pullback in spending and deferral of costs like auto repairs. To address these pressures, we are prioritizing several non-paid marketing initiatives—such as enhancing our site conversion and strengthening our search engine optimization —alongside driving mobile app adoption, generating high-margin fee income, expanding our product assortment, and growing our wholesale channel. We believe these efforts will position us to increase our net profit margin and drive long-term growth" said David Meniane, CEO. Fiscal Year 2024 Financial Results Net sales in fiscal year 2024 were $588.8 million, down 13% from $675.7 million in fiscal year 2023. The decline was primarily driven by the impact of soft consumer demand as well as significant pressures in lighting and mirrors which got impacted by the flooding of non-compliant illegal parts. Gross profit was $196.7 million in fiscal year 2024 compared to $229.4 million in fiscal year 2023, with gross margin decreasing 50 basis points to 33.4%. Total operating expenses in fiscal year 2024 were $237.4 million compared to $239.3 million in fiscal year 2023. Operating expense as a percent of net sales increased 4.9% to 40.3% in fiscal year 2024, mainly attributable to investments in our business, such as brand and marketing investments, higher customer acquisition costs, overlapping software expenses related to our digital transformation and one-time costs related to the move to the new Las Vegas distribution center. Net loss in fiscal year 2024 was ($40.6) million compared to a net loss of ($8.2) million in fiscal year 2023. Adjusted EBITDA in fiscal year 2024 was ($7.1) million compared to $19.7 million in fiscal year 2023. On December 28, 2024, the Company had a cash balance of $36.4 million and no revolver debt, compared to no revolver debt and a $51.0 million cash balance at prior fiscal year-end December 30, 2023. Fourth Quarter 2024 Financial Results Net sales in the fourth quarter of 2024 were $133.5 million, down 15% from the year-ago quarter. Gross profit in the fourth quarter was $43.4 million compared to $51.6 million, with gross margin decreasing 50 basis points to 32.5%. Total operating expenses in the fourth quarter were $58.9 million compared to $58.4 million in the year-ago. Net loss in the fourth quarter was ($15.4) million compared to a net loss of ($6.1) million in the year-ago quarter. Adjusted EBITDA in the fourth quarter was ($6.8) million compared to $1.0 million in the year-ago quarter, primarily due to higher-than-expected advertising cost per click and lower flow through from decreased revenue. 2025 Outlook The company is currently evaluating various strategic alternatives in response to inbound interest. As a result, we are not providing guidance for 2025. Conference Call CEO David Meniane and CFO Ryan Lockwood will host a conference call today to discuss the results. Date: Tuesday, March 25, 2025Time: 5:00 p.m. Eastern time (2:00 p.m. Pacific time) Webcast: To listen to the live call, please click the link above to access the webcast. A replay of the audio webcast will be archived on the Company's website at About Inc. Inc. is a technology-driven eCommerce company offering over 1 million high-quality automotive parts and accessories. Operating for over 25 years, has established itself as a premier destination for drivers seeking repair and maintenance solutions. Our commitment lies in placing the customer at the forefront of our operations, evident in our easy-to-use, mobile-friendly website and app. With a commitment to affordability and customer satisfaction, simplifies the automotive repair process, aiming to eliminate the uncertainty and stress often associated with vehicle maintenance. Backed by a robust company-operated fulfillment network, we ensure swift delivery of top-quality parts from leading brands to customers across the nation. At our global team is united by a shared vision: Empowering Drivers Along Their Journey. is headquartered in Torrance, California. Non-GAAP Financial Measures Regulation G, and other provisions of the Securities Exchange Act of 1934, as amended, define and prescribe the conditions for use of certain non-GAAP financial information. We provide "Adjusted EBITDA" in this earnings release and on today's scheduled conference call, which are non-GAAP financial measures. Adjusted EBITDA consist of net loss before (a) interest (income) expense, net; (b) income tax provision; (c) depreciation and amortization expense; (d) amortization of intangible assets; (e) share-based compensation expense; (f) workforce transition costs; and (g) distribution center costs. A reconciliation of Adjusted EBITDA to net loss is provided below. The Company believes that these non-GAAP financial measures provide important supplemental information to management and investors. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company's operations that, when viewed with the GAAP results and the accompanying reconciliations to corresponding GAAP financial measures, provides a more complete understanding of factors and trends affecting the Company's business and results of operations. Management uses Adjusted EBITDA as measures of the Company's operating performance because it assists in comparing the Company's operating performance on a consistent basis by removing the impact of stock compensation expense as well as other items that we do not believe are representative of our ongoing operating performance. Internally, these non-GAAP measures are also used by management for planning purposes, including the preparation of internal budgets; for allocating resources to enhance financial performance; and for evaluating the effectiveness of operational strategies. The Company also believes that analysts and investors use these non-GAAP measures as supplemental measures to evaluate the ongoing operations of companies in our industry. These non-GAAP financial measures are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. Management strongly encourages investors to review the Company's consolidated financial statements in their entirety and to not rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. In addition, the Company expects to continue to incur expenses similar to the non-GAAP adjustments described above, and exclusion of these items from the Company's non-GAAP measures should not be construed as an inference that these costs are all unusual, infrequent or non-recurring. Safe Harbor Statement This press release contains statements which are based on management's current expectations, estimates and projections about the Company's business and its industry, as well as certain assumptions made by the Company. These statements are forward looking statements for the purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended and Section 27A of the Securities Act of 1933, as amended. Words such as "anticipates," "could," "expects," "intends," "plans," "potential," "believes," "predicts," "projects," "seeks," "estimates," "may," "will," "would," "will likely continue" and variations of these words or similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to, statements regarding our future operating results and financial condition, our potential growth, our ability to innovate, our ability to gain market share, and our ability to expand and improve our product offerings. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. Important factors that may cause such a difference include, but are not limited to, competitive pressures, our dependence on search engines to attract customers, demand for the Company's products, the online market and channel mix for aftermarket auto parts, the economy in general, increases in commodity and component pricing that would increase the Company's product costs, the operating restrictions in its credit agreement, the weather and any other factors discussed in the Company's filings with the Securities and Exchange Commission (the "SEC"), including the Risk Factors contained in the Company's Annual Report on Form 10–K and Quarterly Reports on Form 10–Q, which are available at and the SEC's website at You are urged to consider these factors carefully in evaluating the forward-looking statements in this release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. Unless otherwise required by law, the Company expressly disclaims any obligation to update publicly any forward-looking statements, whether as result of new information, future events or otherwise. Investor Relations: Ryan Lockwood, CFAIR@ Summarized information for the periods presented is as follows (in millions): Thirteen WeeksEndedThirteen WeeksEndedFifty-Two WeeksEndedFifty-Two Weeks EndedDecember 28, 2024December 30, 2023December 28, 2024December 30, 2023Net sales$ 133.54$ 156.40$ 588.85$ 675.73Gross profit$ 43.45$ 51.60$ 196.74$ 229.41 32.5 %33.0 %33.4 %33.9 % Operating expense$ 58.92$ 58.35$ 237.37$ 239.29 44.1 %37.3 %40.3 %35.4 % Net loss$ (15.42)$ (6.09)$ (40.60)$ (8.22) (11.5) %(3.9) %(6.9) %(1.2) % Adjusted EBITDA$ (6.83)$ 0.97$ (7.06)$ 19.69 (5.1) %0.6 %(1.2) %2.9 % The table below reconciles net loss to Adjusted EBITDA for the periods presented (in thousands): Thirteen WeeksEndedThirteen Weeks EndedFifty-Two Weeks EndedFifty-Two WeeksEnded December 28, 2024December 30, 2023December 28, 2024December 30, 2023 Net loss$ (15,418)$ (6,086)$ (40,601)$ (8,223) Depreciation & amortization 5,539 4,094 18,975 16,690 Amortization of intangible assets 88 8 121 36 Interest (income) expense, net (61) (313) (301) (636) Income tax provision 7 (251) 267 145 EBITDA$ (9,845)$ (2,548)$ (21,539)$ 8,012 Stock compensation expense$ 3,018$ 3,517$ 11,985$ 11,675 Workforce transition costs(1) — — 617 — Distribution center costs(2) — — 1,882 — Adjusted EBITDA$ (6,827)$ 969$ (7,055)$ 19,687 ____________________________ (1) We incurred workforce transition costs, primarily related to severance, as part of our recent workforce reductions. (2) We incurred certain non-recurring costs, primarily overlapping rent expense, attributable to moving to our new Las Vegas, Nevada distribution center. INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE OPERATIONS(In Thousands, Except Per Share Data)Fiscal Year Ended December 28,December 30, 20242023 Net sales$ 588,846$ 675,729 Cost of sales (1) 392,107 446,323 Gross profit 196,739 229,406 Operating expense 237,374 239,287 Loss from operations (40,635) (9,881) Other income (expense): Other income, net 1,466 3,197 Interest expense (1,165) (1,394) Total other income, net 301 1,803 Loss before income taxes (40,334) (8,078) Income tax provision 267 145 Net loss (40,601) (8,223) Other comprehensive gain (loss): Foreign currency adjustments 87 — Actuarial gain (loss) on defined benefit plan 185 (305) Unrealized loss on deferred compensation trust assets — (38) Total other comprehensive gain (loss) 272 (343) Comprehensive loss$ (40,329)$ (8,566) Net loss per share: Basic and diluted net loss per share$ (0.71)$ (0.15) Weighted-average common shares outstanding: Shares used in computation of basic and diluted net loss per share 57,026 56,570 _______________________ (1) Excludes depreciation and amortization expense which is included in operating expense. INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS(In Thousands, Except Par Value Data)December 28,December 30, 20242023 ASSETS Current assets: Cash and cash equivalents$ 36,397$ 50,951 Accounts receivable, net 6,098 7,365 Inventory, net 90,353 128,901 Other current assets 6,020 6,121 Total current assets 138,868 193,338 Property and equipment, net 32,206 26,389 Right-of-use - assets - operating leases, net 26,682 19,542 Right-of-use - assets - finance leases, net 10,765 15,255 Other non-current assets 2,053 3,331 Total assets$ 210,574$ 257,855 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable$ 60,365$ 77,851 Accrued expenses 16,083 20,770 Right-of-use - obligation - operating, current 5,810 4,749 Right-of-use - obligation - finance, current 3,471 4,308 Other current liabilities 4,694 5,308 Total current liabilities 90,423 112,986 Right-of-use - obligation - operating, non-current 23,203 16,742 Right-of-use - obligation - finance, non-current 8,842 12,327 Other non-current liabilities 2,931 2,969 Total liabilities 125,399 145,024 Commitments and contingencies (Note 8) Stockholders' equity: Common stock, $0.001 par value; 100,000 shares authorized; 57,454 and 56,303 shares issued and outstanding as of December 28, 2024 and December 30, 2023 (of which 3,786 are treasurystock) 61 60 Treasury stock (11,912) (11,912) Additional paid-in capital 325,546 312,874 Accumulated other comprehensive income 1,055 783 Accumulated deficit (229,575) (188,974) Total stockholders' equity 85,175 112,831 Total liabilities and stockholders' equity$ 210,574$ 257,855 INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(In Thousands)Year Ended December 28,December 30, 20242023 Operating activities Net loss$ (40,601)$ (8,223) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization expense 18,975 16,690 Amortization of intangible assets 121 36 Share-based compensation expense 11,985 11,675 Stock awards issued for non-employee director service 43 23 Stock awards related to officers and directors stock purchase plan from payroll deferral 10 — Gain from disposition of assets (70) (78) Amortization of deferred financing costs 65 65 Changes in operating assets and liabilities: Accounts receivable 1,267 (1,101) Inventory 38,547 6,681 Other current assets 102 549 Other non-current assets 1,168 (248) Accounts payable and accrued expenses (21,187) 23,696 Other current liabilities (615) 686 Right-of-use obligation - operating leases - current 1,514 631 Right-of-use obligation - operating leases - long-term (1,131) (714) Other non-current liabilities 145 (367) Net cash provided by operating activities 10,338 50,001 Investing activities Additions to property and equipment (20,573) (11,879) Cash paid for intangible assets (76) (108) Proceeds from sale of property and equipment 92 86 Net cash used in investing activities (20,557) (11,901) Financing activities Borrowings from revolving loan payable 229 244 Payments made on revolving loan payable (229) (244) Repurchase of treasury stock — (4,311) Payments on finance leases (4,311) (4,738) Net proceeds from issuance of common stock for ESPP 359 483 Statutory tax withholding payment for share-based compensation (470) — Proceeds from exercise of stock options — 2,650 Net cash used in financing activities (4,422) (5,916) Effect of exchange rate changes on cash 87 — Net change in cash and cash equivalents (14,554) 32,184 Cash and cash equivalents, beginning of period 50,951 18,767 Cash and cash equivalents, end of period$ 36,397$ 50,951 Supplemental disclosure of non-cash investing and financing activities: Right-of-use operating asset acquired$ 12,857$ — Right-of-use finance asset acquired$ —$ 784 Accrued asset purchases$ 502$ 1,499 Share-based compensation expense capitalized in property and equipment$ 746$ 804 Supplemental disclosure of cash flow information: Cash paid during the period for income taxes$ 178$ 210 Cash paid during the period for interest$ 1,165$ 1,394 Cash received during the period for interest$ 1,466$ 2,030 View original content to download multimedia: SOURCE Inc. Sign in to access your portfolio
