Net Sales Increased 9.5% Compared to the Second Quarter of 2023, with U.S. Net Sales Up 19.3% Active Customer Growth of 11.7% on a Trailing Twelve-Month Basis Compared to the Second Quarter of 2023 On Track to Open Five Princess Polly Stores in 2024 Exhibit 99.1 a.k.a. Brands Holding Corp. Reports Second Quarter 2024 Financial Results SAN FRANCISCO – August 7, 2024 – a.k.a. Brands Holding Corp. (NYSE: AKA), a brand accelerator of next generation fashion brands, today announced financial results for the quar ...

Financial Data and Key Metrics Changes - Net sales for Q1 2024 were $117 million, down 3% year-over-year, but only down 1% on a constant currency basis [19] - Adjusted EBITDA was $874,000, exceeding guidance, compared to $2.2 million in the same period last year [23] - Gross margin was 56.2%, slightly down from 56.9% year-over-year [21] - Total debt decreased by 22% to $103.6 million compared to $132.4 million a year ago [23] Business Line Data and Key Metrics Changes - U.S. business net sales increased by 6.2%, accounting for 66% of total net sales, a 10% penetration increase [10][19] - Australia and New Zealand region net sales declined by 19.1% [19] - Petal & Pup launched a wedding guest collection and expanded its omni-channel presence, contributing to strong performance [16][17] Market Data and Key Metrics Changes - Active customer growth was 5.5%, with 3.8 million active customers in Q1 [20] - Average order value decreased by 3.8% to $77 [21] - The U.S. market remains the most profitable growth region, while Australia and New Zealand face challenging macro conditions [10][32] Company Strategy and Development Direction - The company focuses on three strategic priorities: retaining existing customers, expanding omni-channel presence, and streamlining operations for financial benefits [11][12] - Plans to open three new Princess Polly stores in Q3 2024, indicating a commitment to physical retail expansion [14] - The test-and-repeat merchandising approach is central to the company's strategy, allowing for better inventory management and customer engagement [11][39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in growth opportunities in the U.S. market, particularly for Culture Kings and other brands [30][32] - The company raised its net sales guidance for 2024 to a range of $545 million to $555 million, reflecting a strong start to the year [24][27] - Management anticipates gross margin expansion in the second half of the year as inventory management improves [25][32] Other Important Information - The company repurchased 106,153 shares for approximately $1.1 million during the quarter [24] - Inventory levels decreased by 19% to $91.5 million, indicating effective inventory management [23] Q&A Session Summary Question: Opportunities for more Culture Kings stores in the U.S. - Management sees potential for more Culture Kings stores in the U.S. but not at the same level as the Las Vegas flagship [30] Question: Inventory normalization expectations - Management expects small sequential improvements in inventory levels as the U.S. business continues to grow [34] Question: Intra-quarter cadence and active customer growth - Management noted strong momentum in Q1, particularly in the U.S., with active customer growth across all channels [37][39] Question: Performance of Australia and New Zealand - Management acknowledged challenges in Australia but is optimistic about transitioning Culture Kings to a test-and-repeat model [42] Question: Capital allocation strategy - Management prioritizes growth opportunities while continuing to pay down debt and invest in the business [46]

[PART I - FINANCIAL INFORMATION](index=6&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) This section presents the company's unaudited condensed consolidated financial statements and management's discussion for the quarter ended March 31, 2024 [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Q1 2024, reporting a net loss of $8.9 million Condensed Consolidated Balance Sheet Highlights (unaudited) | Account | March 31, 2024 (in thousands) | December 31, 2023 (in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | $133,611 | $135,695 | | **Total Assets** | $355,754 | $361,721 | | **Total Current Liabilities** | $82,489 | $85,961 | | **Total Liabilities** | $220,244 | $213,103 | | **Total Stockholders' Equity** | $135,510 | $148,618 | Condensed Consolidated Statements of Income (unaudited) | Metric | Three Months Ended Mar 31, 2024 (in thousands) | Three Months Ended Mar 31, 2023 (in thousands) | | :--- | :--- | :--- | | Net sales | $116,840 | $120,485 | | Gross profit | $65,674 | $68,500 | | Loss from operations | $(6,093) | $(6,551) | | Net loss | $(8,933) | $(9,553) | | Net loss per share (Basic & Diluted) | $(0.85) | $(0.89) | Condensed Consolidated Statements of Cash Flows Highlights (unaudited) | Activity | Three Months Ended Mar 31, 2024 (in thousands) | Three Months Ended Mar 31, 2023 (in thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(7,687) | $(2,960) | | Net cash used in investing activities | $(755) | $(1,880) | | Net cash provided by (used in) financing activities | $8,899 | $(11,443) | | **Net decrease in cash** | **$(133)** | **$(16,129)** | [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes detail accounting policies, financial components, and disclosures, including revenue disaggregation and debt structure - The company has aggregated its four brands (Princess Polly, Petal & Pup, Culture Kings, mnml) into a single reportable segment due to similarities in products, processes, customers, and economic characteristics[38](index=38&type=chunk) Net Sales by Geography (in thousands) | Geography | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | U.S. | $77,138 | $72,626 | | Australia/New Zealand | $33,516 | $41,446 | | Rest of world | $6,186 | $6,413 | | **Total** | **$116,840** | **$120,485** | - As of March 31, 2024, the company had **$103.6 million** in total debt, consisting of a **$94.0 million** term loan and **$10.5 million** drawn on its revolving credit facility. The company was in compliance with all debt covenants[49](index=49&type=chunk)[51](index=51&type=chunk) - On September 29, 2023, the company effected a **one-for-12 reverse stock split** of its common stock. All share and per-share amounts for prior periods have been retrospectively adjusted[74](index=74&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2024 performance, noting a 3% net sales decrease to $116.8 million and a net loss of $8.9 million Key Operating Metrics | Metric | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Active customers (millions) | 3.83 | 3.63 | | Average order value ($) | $77 | $80 | | Number of orders (millions) | 1.52 | 1.50 | Key Financial Metrics (GAAP and Non-GAAP) | Metric | Three Months Ended Mar 31, 2024 (in thousands) | Three Months Ended Mar 31, 2023 (in thousands) | | :--- | :--- | :--- | | Gross margin | 56% | 57% | | Net loss | $(8,933) | $(9,553) | | Adjusted EBITDA | $874 | $2,186 | | Adjusted EBITDA margin | 1% | 2% | - Net sales decreased by **3%** (**1%** on a constant currency basis) primarily due to a **4% decrease** in average order value, which was impacted by adverse macroeconomic conditions in Australia and New Zealand[106](index=106&type=chunk) - General and administrative expenses decreased by **$3.2 million** (**12%**), driven by lower sales tax penalties, professional fees, and intangible amortization[110](index=110&type=chunk) [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity relies on $21.9 million cash and a senior secured credit facility, deemed sufficient for the next 12 months - Principal sources of liquidity as of March 31, 2024, were cash and cash equivalents of **$21.9 million**, a revolving line of credit, and a term loan accordion provision[113](index=113&type=chunk) - Net cash used in operating activities increased to **$7.7 million** in Q1 2024 from **$3.0 million** in Q1 2023, primarily due to increased inventory purchases compared to the prior period[119](index=119&type=chunk)[121](index=121&type=chunk) - Net cash provided by financing activities was **$8.9 million** in Q1 2024, a significant shift from the **$11.4 million** used in Q1 2023. This was mainly due to **$10.1 million** in net proceeds from the credit facility in 2024 versus net repayments in 2023[119](index=119&type=chunk)[125](index=125&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exempt from market risk disclosures as a smaller reporting company under SEC regulations - As a "smaller reporting company," the company is exempt from providing quantitative and qualitative disclosures about market risk[129](index=129&type=chunk) [Item 4. Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective due to two unremediated material weaknesses in internal control over financial reporting - Management concluded that disclosure controls and procedures were not effective at the reasonable assurance level as of March 31, 2024, due to two unremediated material weaknesses[130](index=130&type=chunk) - The two material weaknesses are: (1) insufficient design, implementation, and documentation of internal controls at the entity level and across key processes, and (2) lack of appropriate segregation of duties in manual and IT-based processes[132](index=132&type=chunk) - Remediation efforts are ongoing, including hiring experienced personnel, engaging a third-party consulting firm, and implementing a new Enterprise Resource Planning (ERP) system to improve controls and enforce segregation of duties[132](index=132&type=chunk)[133](index=133&type=chunk)[134](index=134&type=chunk) [PART II - OTHER INFORMATION](index=39&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, other information, and exhibits for the reporting period [Item 1. Legal Proceedings](index=39&type=section&id=Item%201.%20Legal%20Proceedings) The company is subject to ordinary legal proceedings, with no material adverse impact expected, but a new copyright claim is noted - The company states that existing legal proceedings are not expected to have a material adverse impact on its financial position or results of operations[137](index=137&type=chunk) - In April 2024, the company received a cease and desist letter for alleged copyright infringement. While a loss is reasonably possible, the amount is not currently estimable[83](index=83&type=chunk) [Item 1A. Risk Factors](index=39&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors were reported in this period - The company reports no material changes to the risk factors disclosed in its 2023 Form 10-K[138](index=138&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities](index=39&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This section details the company's share repurchase activity, with 113,959 shares repurchased in Q1 2024 Share Repurchase Activity (Q1 2024) | Period | Total Shares Purchased | Average Price Paid per Share ($) | | :--- | :--- | :--- | | Jan 2024 | 49,081 | $9.40 | | Feb 2024 | 37,501 | $10.24 | | Mar 2024 | 27,377 | $10.98 | | **Total** | **113,959** | **-** | - As of March 31, 2024, approximately **$1.8 million** remained available for future repurchases under the company's Share Repurchase Program[140](index=140&type=chunk) [Item 5. Other Information](index=40&type=section&id=Item%205.%20Other%20Information) No directors or executive officers adopted or terminated Rule 10b5-1 trading plans during Q1 2024 - During the three months ended March 31, 2024, no directors or executive officers adopted or terminated a Rule 10b5-1 trading plan[143](index=143&type=chunk) [Item 6. Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including required certifications and XBRL data files

[a.k.a. Brands Holding Corp. First Quarter 2024 Financial Results](index=1&type=section&id=a.k.a.%20Brands%20Holding%20Corp.%20First%20Quarter%202024%20Financial%20Results) [Performance Overview](index=1&type=section&id=Performance%20Overview) In Q1 2024, the company exceeded guidance despite a 3.0% decline in total net sales, driven by U.S. growth and balance sheet improvements Q1 2024 Key Financial Metrics | Metric | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $116.8M | $120.5M | -3.0% | | U.S. Net Sales | - | - | +6.2% | | Net Loss | $(8.9)M | $(9.6)M | N/A | | Net Loss per Share | $(0.85) | $(0.89) | N/A | | Adjusted EBITDA | $0.9M | $2.2M | -59.1% | - The company successfully grew its active customer base by **5.5%** on a trailing twelve-month basis compared to Q1 2023[3](index=3&type=chunk)[6](index=6&type=chunk) - Significant balance sheet improvements were made year-over-year, with a **19% reduction in inventory** and a **22% reduction in debt**[3](index=3&type=chunk) - Management highlighted strong execution of strategic priorities, including customer acquisition and retention, omnichannel presence, and operational streamlining[6](index=6&type=chunk)[8](index=8&type=chunk) [Brand Highlights](index=1&type=section&id=Brand%20Highlights) Key brands executed strategic initiatives, including physical store expansion, new marketplace launches, and strong U.S. sales growth - Princess Polly is expanding its physical retail footprint with **three new stores planned for Q3 2024** in Scottsdale, Boston, and San Diego[12](index=12&type=chunk) - Petal & Pup expanded its omnichannel strategy by launching on Nordstrom's website, building on previous successes with Macy's and Target[12](index=12&type=chunk) - Culture Kings U.S. delivered another quarter of **strong double-digit net sales growth**, driven by its first-party brands which made up over 50% of its U.S. sales[12](index=12&type=chunk) [Financial Performance Analysis](index=2&type=section&id=Financial%20Performance%20Analysis) The company experienced mixed financial results with declining net sales and gross margin, offset by reduced administrative expenses [First Quarter Financial Details](index=2&type=section&id=First%20Quarter%20Financial%20Details) Net sales decreased 3.0% and gross margin contracted slightly, while G&A expenses improved as a percentage of sales Q1 2024 vs Q1 2023 Operating Results | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net Sales | $116.8M | $120.5M | | Gross Margin | 56.2% | 56.9% | | Selling Expenses (% of sales) | 29.3% | 28.6% | | Marketing Expenses (% of sales) | 12.7% | 12.3% | | G&A Expenses (% of sales) | 19.4% | 21.5% | | Adjusted EBITDA | $0.9M | $2.2M | - The decrease in net sales was driven by a decline in average order value, primarily due to adverse macroeconomic conditions in Australia and New Zealand[18](index=18&type=chunk) - G&A expenses decreased primarily due to reductions in sales tax penalties and interest, professional fees, intangible amortization, and insurance costs[18](index=18&type=chunk) [Balance Sheet and Cash Flow](index=2&type=section&id=Balance%20Sheet%20and%20Cash%20Flow) The company strengthened its balance sheet by reducing inventory and debt, though cash flow from operations saw increased usage Balance Sheet and Cash Flow Highlights (as of March 31, 2024) | Metric | Q1 2024 | Q1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $21.9M | $30.2M | -27.5% | | Inventory | $91.5M | $112.5M | -18.7% | | Total Debt | $103.6M | $132.4M | -21.8% | | Cash flow used in operations | $(7.7)M | $(3.0)M | +156.7% | [Outlook](index=2&type=section&id=Outlook) The company provides guidance for Q2 and the full fiscal year 2024, anticipating net sales of $545 million to $555 million for the year Q2 2024 Outlook | Metric | Guidance Range | | :--- | :--- | | Net Sales | $133M - $138M | | Adjusted EBITDA | $4.5M - $5.5M | | Weighted Avg. Diluted Shares | 10.5M | Full Year 2024 Outlook | Metric | Guidance Range | | :--- | :--- | | Net Sales | $545M - $555M | | Adjusted EBITDA | $17M - $19M | | Weighted Avg. Diluted Shares | 10.6M | - The outlook assumes continued macroeconomic pressures, particularly in Australia and New Zealand, and the opening of three to four Princess Polly stores[16](index=16&type=chunk) [Key Financial and Operating Metrics](index=9&type=section&id=Key%20Financial%20and%20Operating%20Metrics) Active customers grew 5.5%, but average order value declined, with U.S. sales growth contrasting a sharp decline in Australia/New Zealand Key Operational Metrics (Q1 2024 vs Q1 2023) | Metric | Q1 2024 | Q1 2023 | % Change | | :--- | :--- | :--- | :--- | | Active customers (millions) | 3.83 | 3.63 | 5.5% | | Average order value | $77 | $80 | (3.8)% | | Number of orders (millions) | 1.52 | 1.50 | 1.3% | Sales by Region (Q1 2024 vs Q1 2023) | Region | Q1 2024 Sales | Q1 2023 Sales | % Change | | :--- | :--- | :--- | :--- | | U.S. | $77.1M | $72.6M | 6.2% | | Australia/New Zealand | $33.5M | $41.4M | (19.1)% | | Rest of world | $6.2M | $6.4M | (3.5)% | | **Total** | **$116.8M** | **$120.5M** | **(3.0)%** | [Consolidated Financial Statements](index=6&type=section&id=Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated statements of income, balance sheets, and cash flows for Q1 2024 [Condensed Consolidated Statements of Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) The company reported a net loss of $8.9 million on net sales of $116.8 million for the first quarter of 2024 Q1 2024 Income Statement Summary (in thousands) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net sales | $116,840 | $120,485 | | Gross profit | $65,674 | $68,500 | | Loss from operations | $(6,093) | $(6,551) | | Net loss | $(8,933) | $(9,553) | | Net loss per share | $(0.85) | $(0.89) | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2024, the company held total assets of $355.8 million and total liabilities of $220.2 million Balance Sheet Summary (in thousands) | Line Item | March 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $21,939 | $21,859 | | Inventory | $91,489 | $91,024 | | Total assets | $355,754 | $361,721 | | Total liabilities | $220,244 | $213,103 | | Total stockholders' equity | $135,510 | $148,618 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities was $7.7 million, while financing activities provided $8.9 million in cash Cash Flow Summary (in thousands) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(7,687) | $(2,960) | | Net cash used in investing activities | $(755) | $(1,880) | | Net cash (used in) provided by financing activities | $8,899 | $(11,443) | | Net decrease in cash | $(133) | $(16,129) | [Reconciliation of Non-GAAP Financial Measures](index=10&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section reconciles the Q1 2024 GAAP net loss of $8.9 million to the non-GAAP Adjusted EBITDA of $0.9 million Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | **Net loss** | **$ (8,933)** | **$ (9,553)** | | Total other expense, net | 2,821 | 3,885 | | Provision for (benefit from) income tax | 19 | (883) | | Depreciation and amortization expense | 4,298 | 5,440 | | Equity-based compensation expense | 1,956 | 1,936 | | Non-routine items | 713 | 1,361 | | **Adjusted EBITDA** | **$ 874** | **$ 2,186** |

Core Insights - Culture Kings has announced its return as an official partner of Rolling Loud California, taking place from March 14th to March 17th, 2024, marking the second consecutive year of this global partnership [1] - The collaboration includes Culture Kings serving as the official streetwear retailer at the festival, offering an exclusive 'Rolling Loud' merchandise capsule [1][3] - A branded stage will be presented by Culture Kings at the festival, showcasing emerging artists and featuring a branded basketball court for interactive engagement [2] Company Overview - Culture Kings is a leading international streetwear brand known for its immersive shopping experiences, with nine retail stores across the United States, Australia, and New Zealand [4] - The brand integrates fashion, art, sports, and music, positioning itself at the forefront of the global streetwear phenomenon [4] Industry Context - Rolling Loud is recognized as the World's Largest Hip-Hop Festival, founded by Matt Zingler and Tariq Cherif, and has expanded to host shows on multiple continents [5] - The festival celebrates its 10th anniversary in 2024, highlighting its evolution into a major force in hip-hop and its role in promoting both established and emerging artists [5]

Financial Data and Key Metrics Changes - In Q4 2023, the company reported net sales of $149 million, flat compared to the same period last year, with U.S. business growing by 12% [7][21] - For the full year, net sales reached $546 million, with adjusted EBITDA of $14 million [8][26] - The company reduced its year-end inventory by 28% compared to the previous year and paid down approximately $50 million of debt, reducing total debt by 35% [6][27] Business Line Data and Key Metrics Changes - Princess Polly, the largest brand, opened its first physical store in Los Angeles, contributing to its growth in the U.S. market [12][10] - Culture Kings registered strong double-digit growth in both Q4 and the full fiscal year in the U.S. [17][19] - Petal & Pup expanded its distribution by launching on Nordstrom's website, enhancing its marketplace presence [16] Market Data and Key Metrics Changes - The U.S. market is now the largest for the company, showing the greatest potential for future growth, while Australia and New Zealand faced ongoing challenges with a 12% decline in sales [7][22] - The rest of the world saw a 9% increase in net sales, indicating strength in international markets [22] Company Strategy and Development Direction - The company aims to implement innovative retail strategies, expand omni-channel initiatives, and streamline operations to enhance financial performance [8][30] - A focus on the test and repeat merchandising approach is being adopted for Culture Kings to improve inventory management and gross margins [9][24] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging macro environment in Australia but expressed confidence in the U.S. market's growth potential [35][36] - For 2024, the company expects net sales between $540 million to $555 million and adjusted EBITDA of $16 million to $18 million [31][32] Other Important Information - The company generated $33 million of cash flow from operations in 2023, a significant improvement from cash use of $300,000 in 2022 [29] - The company repurchased 175,161 shares for approximately $1.3 million in Q4 2023 [30] Q&A Session Summary Question: Can you help us parse out the weakness in Australia and New Zealand? - Management noted that while the U.S. market grew 12%, Australia faced a 12% decline, with expectations of mid-teens negative growth for the year [35][36] Question: What is the path to debt repayment? - The company paid down $50 million of debt last year and expects to continue making progress on debt repayment, with debt due in Q3 2026 [37][38] Question: What pressures are affecting gross margins? - Management indicated that inventory management improvements and omni-channel opportunities are expected to enhance gross margins moving forward [40][41]

Company Performance - A.k.a. Brands reported a quarterly loss of $1.31 per share, significantly worse than the Zacks Consensus Estimate of a loss of $0.46, and compared to a loss of $0.36 per share a year ago, indicating a negative earnings surprise of -184.78% [1] - The company's revenues for the quarter ended December 2023 were $148.91 million, missing the Zacks Consensus Estimate by 3.56%, and slightly down from $149.13 million in the same quarter last year [1] - Over the last four quarters, A.k.a. Brands has not surpassed consensus EPS estimates, and it has topped consensus revenue estimates only twice [1] Stock Performance - A.k.a. Brands shares have increased by approximately 51.6% since the beginning of the year, outperforming the S&P 500, which gained 7% [2] - The future performance of A.k.a. Brands' stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.24 on revenues of $127.5 million, and for the current fiscal year, it is -$0.77 on revenues of $586.6 million [4] - The estimate revisions trend for A.k.a. Brands is mixed, resulting in a Zacks Rank 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [3] Industry Context - The Retail - Apparel and Shoes industry, to which A.k.a. Brands belongs, is currently ranked in the bottom 39% of over 250 Zacks industries, suggesting potential challenges ahead [4] - Zumiez, another company in the same industry, is expected to report quarterly earnings soon, with a consensus EPS estimate of $0.26, reflecting a year-over-year decline of -55.9% [5]

Financial Performance - For the year ended December 31, 2023, net sales decreased to $546.3 million, down 10.7% from $611.7 million in 2022[344] - Gross profit for 2023 was $300.3 million, representing a gross margin of 54.9%, compared to $337.2 million and a margin of 55.1% in 2022[344] - The company reported a net loss of $98.9 million for 2023, an improvement from a net loss of $176.7 million in 2022[344] - The net loss for the year ended December 31, 2023, was $98,886 thousand, a decrease from a net loss of $176,697 thousand in 2022[350] - The Company reported a loss before income taxes of $96,965 million in 2023, a decrease from a loss of $180,614 million in 2022[470] Assets and Liabilities - Total current assets decreased to $135.7 million in 2023, down 31.3% from $197.6 million in 2022[341] - Total liabilities decreased to $213.1 million in 2023, down 18.9% from $262.6 million in 2022[341] - Cash and cash equivalents decreased to $21.9 million in 2023, down 52.8% from $46.3 million in 2022[341] - The company’s accumulated deficit increased to $267.4 million in 2023, compared to $168.5 million in 2022[341] - Total prepaid expenses and other current assets increased to $15.846 million as of December 31, 2023, compared to $13.378 million in 2022, with significant increases in security deposits and inventory prepayments[444] Goodwill and Impairments - The company incurred a goodwill impairment of $68.5 million in 2023, compared to $173.8 million in 2022[344] - Goodwill decreased significantly to $94.9 million as of December 31, 2023, from $167.7 million in 2022, following a non-cash goodwill impairment charge of $68.5 million in Q3 2023[446] - The Company recorded a total non-cash goodwill impairment charge of $173.8 million during the year ended December 31, 2022, due to unfavorable economic trends and changing customer preferences[447] Cash Flow and Financing Activities - Cash flows from operating activities provided $33,426 thousand in 2023, compared to a cash outflow of $319 thousand in 2022[350] - The Company’s cash flow from financing activities resulted in a net outflow of $52,829 thousand in 2023, contrasting with a net inflow of $33,260 thousand in 2022[350] - The Company issued $25.0 million in senior subordinated notes to an affiliate of Summit in connection with the acquisition of Culture Kings, which were paid in full and terminated during the IPO[507] Equity and Stock Transactions - The weighted average shares outstanding for basic and diluted net loss per share was approximately 10.7 million in 2023, compared to 10.7 million in 2022[344] - The Company repurchased shares worth $2,100 thousand in 2023, with no repurchases reported in 2022[350] - The Company repurchased 348,468 shares of its common stock for $2.3 million in 2023, at an average price of $6.72 per share[501] Expenses - Operating expenses totaled $383.7 million in 2023, a decrease from $509.3 million in 2022, primarily due to reduced selling and administrative costs[344] - Selling expenses, including shipping and handling costs, totaled $69.3 million for the year ended December 31, 2023, down from $80.5 million in 2022[414] - The Company recognized total equity-based compensation expense of $7.64 million in 2023, an increase from $6.73 million in 2022[495] Tax and Deferred Revenue - The provision for income taxes in 2023 was $1,921 million, compared to a benefit of $(3,917) million in 2022[471] - Total deferred revenue as of December 31, 2023, was $11,782 million, slightly up from $11,421 million in 2022[479] Inventory and Assets Management - The company reported a significant increase in inventory, with a change of $32,149 thousand in 2023, compared to a decrease of $16,257 thousand in 2022[350] - The Company’s inventory is valued at the lower of cost or net realizable value, with provisions for excess and obsolete inventory based on future demand assumptions[372] Debt and Interest - As of December 31, 2023, total debt was $93.394 million, down from $143.649 million in 2022, with a term loan balance of $94.450 million[463] - Interest expense for the year ended December 31, 2023, totaled $11.2 million, an increase from $7.0 million in 2022[464] - The all-in interest rate for the Company's term loan and revolving line of credit was 8.47% as of December 31, 2023[462] Subsequent Events and Compliance - The Company has evaluated subsequent events through March 7, 2024, and identified events requiring disclosure in the financial statements[508] - The Company maintained compliance with all debt covenants as of December 31, 2023, including a maximum total net leverage ratio of 3.50 to 1.00[456]

Exhibit 99.1 a.k.a. Brands Holding Corp. Reports Fourth Quarter and Full Year 2023 Financial Results U.S. Net Sales Grew ~12% Compared to the Fourth Quarter of 2022 Strengthened Balance Sheet Through $50.7 Million Debt Paydown in FY23 Scaling Omnichannel Strategy through Additional Stores, Marketplace and Wholesale Opportunities in 2024 SAN FRANCISCO – March 7, 2024 – a.k.a. Brands Holding Corp. (NYSE: AKA), a brand accelerator of next generation fashion brands, today announced financial results for the fou ...

SAN FRANCISCO--(BUSINESS WIRE)--a.k.a. Brands Holding Corp. (NYSE: AKA) (the “Company”), a brand accelerator of next generation fashion brands, today announced that it will report its fourth quarter and fiscal 2023 financial results after the market close on Thursday, March 7, 2024. The company will webcast a call with management that day at 4:15 p.m. Eastern Time (1:15 p.m. Pacific Time). a.k.a. Brands’ webcast will be available via the company website at ir.aka-brands.com. Analysts and investors may also ...