Financial Data and Key Metrics Changes - Global revenue for Q2 2025 was $101.1 million, down from $119.4 million in the prior year quarter, representing a decline of 15.6% on a constant currency basis due to lower volumes and economic headwinds [8][9] - Gross margin decreased to 19.6% from 22.9% in the prior year quarter, with adjusted gross margin at 19.7% compared to 23.8% [11][12] - Adjusted EBITDA for Q2 was a loss of $6.4 million, compared to a loss of $0.1 million in the prior year quarter, primarily due to lower revenues and gross margins [13] - Adjusted diluted net loss per share was $0.33 on 34.7 million shares, compared to a loss of $0.14 on 35 million shares in the prior year quarter [13] Business Line Data and Key Metrics Changes - The porcelain business is being expanded to capture market opportunities, with a focus on zero crystalline silica products in Australia [6] - Sales in the U.S. declined by 17% to $49.6 million, reflecting softer market conditions in the residential channel [9] - Australia sales decreased by 18.2% on a constant currency basis due to regulatory changes and slower demand [10] - EMEA sales increased by 0.7% on a constant currency basis, driven by stronger volumes and favorable order timing [10] Market Data and Key Metrics Changes - Canada sales decreased by 12.5% on a constant currency basis, with softer performance in core business [10] - Israel sales declined by 21.6% on a constant currency basis, impacted by regional conflicts [11] - The U.S. represents approximately half of total revenues, with an estimated tariff impact of 15% to 25% on products sold in the U.S. [15][16] Company Strategy and Development Direction - The company is taking decisive actions to align its cost structure and improve profitability, with total annualized cost savings expected to exceed $55 million since 2022 [4][5] - Focus on strategic transformation initiatives and operational enhancements to achieve higher profitability levels as volumes improve [7][19] - Continued investment in product development and expansion of the porcelain portfolio to capture growing market opportunities [6] Management's Comments on Operating Environment and Future Outlook - Management noted persistent softness in repair and remodel activity across the industry, leading to lower revenues [4] - Confidence in structural improvements made to the business model to achieve higher profitability levels on current sales [19] - The company remains focused on disciplined execution of its transformation strategy and anticipates further improvements in its cost structure [19][20] Other Important Information - The company ended the quarter with total cash of $75.6 million and total debt of $3.2 million, resulting in a net cash position of $72.4 million [14] - A provision of $44.9 million has been recorded for bodily injury claims related to exposure to respirable crystalline silica dust [17] Q&A Session Summary Question: Are the silica cases in Australia impacting demand in the U.S.? - Management stated there is no connection between the Australian cases and U.S. demand, attributing the decline to other reasons [25][26] Question: What caused the gross margin decline quarter over quarter? - The decline was partially due to lower production levels and the impact of regional conflicts, along with price adjustments to remain competitive [27][28] Question: How much of the revenue decline was due to price versus volume? - Year-over-year prices declined by 6.5%, while lower production utilization negatively impacted gross margin [29] Question: Will SG&A expenses continue to decrease? - Management indicated that the decrease is a combination of previous actions and tight control over expenses, with further savings expected in future quarters [30]

Company Strategy & Business Model - The company is shifting from a production-focused to a brand-centric business model to improve cost efficiency and maximize agility[6, 11] - The company is evolving from a countertop player to a surfaces player, expanding its product offerings beyond kitchen and bath to the entire home[6, 9, 10] - The company aims to be the leading choice for surfaces all around the world[8] Financial Performance & Restructuring - The company's revenue in 2024 was approximately $443 million[5] - The company's operating cash flow in 2024 was approximately $32 million[5] - Strategic restructuring plan is expected to generate annualized savings of over $60 million compared to 2022 expenses[31, 32, 33] - Q2'25 revenue was $101.1 million, a 15.3% decrease compared to Q2'24[53] - Q2'25 adjusted gross margin was 19.7%, a 4.1 percentage point decrease compared to Q2'24[53, 55] Market Position & Global Footprint - The company has a global presence in over 60 countries[5, 35] - The company's revenue in 2024 was primarily from the US (49.9%), Canada (13.9%), and Australia (17.0%)[36] - The company is expanding its porcelain offering in the US and Canada[31]

Financial Data and Key Metrics Changes - Global revenue for the first quarter was $99.6 million, down 14.5% year-over-year on a constant currency basis due to lower volumes across main regions [12][14] - Adjusted EBITDA for the first quarter was a loss of $7.1 million compared to a gain of $600,000 in the prior year quarter, primarily reflecting lower revenues and gross margin [16] - Gross margin decreased to 21.3% from 24.5% in the prior year quarter, mainly due to lower fixed cost absorption and unfavorable product mix [14][15] Business Line Data and Key Metrics Changes - U.S. sales decreased by 19.4% to $49.1 million, reflecting softer market conditions in the residential channel [13] - Canada sales were down 11.5% on a constant currency basis, driven by lower sales in the core business [13] - Australia sales dropped approximately 28.2% on a constant currency basis, mainly due to market uncertainty following the governmental ban on silica-based engineered stone products [13] - EMEA region saw a bright spot with a 16.4% increase on a constant currency basis, driven by improved market conditions [14] Market Data and Key Metrics Changes - Approximately half of the company's revenues are generated in the U.S., which is facing challenges due to a new 10% tariff on imports [10][18] - The Australian market is experiencing slower conditions due to high interest rates and fewer new home completions [13] Company Strategy and Development Direction - The company is shifting more than 70% of its production to a global manufacturing network to adapt quickly to market fluctuations [7] - Ongoing investments in porcelain are seen as a strategic pillar for future growth [7] - The company is pivoting from an industrial-oriented organization to one focused on R&D, marketing, and brand development [10] Management's Comments on Operating Environment and Future Outlook - Management commented on the ongoing global economic headwinds affecting activities across most channels, but noted a modest sequential improvement in revenues and adjusted EBITDA [6] - The company is withdrawing its full-year outlook due to persistent macroeconomic pressures and the impact of U.S. tariffs [22] - Despite challenges, management remains confident in executing their transformation strategy and achieving cost optimization savings of approximately $10 million in 2025 [22] Other Important Information - The company has recorded a provision of $50 million for lawsuits related to exposure to respirable crystalline silica dust, with an insurance receivable of $31.6 million [20][39] - The net exposure from all claims is estimated at $19 million after accounting for the insurance receivable [40] Q&A Session Summary Question: Can you walk through the improvement in gross margin? - Management noted that the improvement in gross margin was due to a modest increase in revenues and benefits from restructuring actions [27][28] Question: Do you expect revenue to move higher as the year progresses? - Management expects gradual revenue increases based on historical seasonality and actions being taken [29] Question: How will the tariffs impact the business? - Management indicated that most competitors face similar tariff dynamics and they are considering price adjustments to mitigate the impact [30][33] Question: What is the status of the lawsuits? - Management clarified that the $50 million provision reflects probable exposure for outstanding claims, with additional complexities surrounding other claims [38][39]

Financial Data and Key Metrics Changes - Global revenue for Q1 2025 was $99.6 million, down 14.5% year-over-year on a constant currency basis due to lower volumes across main regions [11][12] - Adjusted EBITDA for Q1 2025 was a loss of $7.1 million compared to a gain of $0.6 million in the prior year quarter, primarily reflecting lower revenues and gross margin [15] - Gross margin decreased to 21.3% from 24.5% in the prior year quarter, mainly due to lower fixed cost absorption and unfavorable product mix [13] Business Line Data and Key Metrics Changes - U.S. sales decreased by 19.4% to $49.1 million, primarily due to softer market conditions in the residential channel [12] - Canada sales were down 11.5% on a constant currency basis, driven by lower sales in the core business [12] - Australia sales dropped approximately 28.2% on a constant currency basis, reflecting market uncertainty and high interest rates [12] - EMEA region saw a bright spot with a 16.4% increase on a constant currency basis, driven by improved market conditions [13] Market Data and Key Metrics Changes - Approximately half of the company's revenues are generated in the U.S., which is facing challenges due to a new 10% tariff on imports [9][17] - The Australian market is impacted by a governmental ban on silica-based engineered stone products, contributing to sales decline [12] Company Strategy and Development Direction - The company is shifting more than 70% of production to a global manufacturing network to enhance operational flexibility [7] - Ongoing investments in porcelain are seen as a strategic pillar for future growth [7] - The company is focused on transforming from an industrial-oriented organization to one centered on R&D, marketing, and brand development [9] Management's Comments on Operating Environment and Future Outlook - Management has withdrawn the full-year outlook due to persistent macroeconomic pressures and the impact of U.S. tariffs [22] - Despite challenges, the company remains confident in executing its transformation strategy and expects to realize approximately $10 million in incremental savings in 2025 [22] Other Important Information - The company recorded a provision of $50 million for lawsuits related to exposure to respirable crystalline silica dust, with an insurance receivable of $31.6 million [19][40] - The net exposure from all claims is estimated at $19 million after accounting for the insurance receivable [40] Q&A Session Summary Question: Can you walk through the improvement in gross margin? - Management noted that the improvement in gross margin was due to modest revenue increases and benefits from restructuring actions [27][28] Question: Do you expect revenue to move higher as the year progresses? - Management indicated that they expect a gradual increase in revenue based on historical seasonality and ongoing actions taken [30] Question: How do tariffs impact the business? - Management stated that most competitors face similar tariff dynamics and they are considering price adjustments to mitigate the impact [31][34] Question: Can you clarify the provision for lawsuits? - Management explained that the $50 million provision reflects probable exposure for outstanding claims, with an additional insurance receivable of $31 million [39][40]

Legal and Regulatory Risks - The company faces significant risks related to bodily injury claims, with ongoing lawsuits involving 296 injured persons globally, including 52 in Israel, 122 in Australia, and 122 in the United States[41]. - An adverse verdict in Los Angeles County resulted in a jury awarding $52.4 million in damages, with the company liable for $13.0 million[42]. - The company estimates potential losses for 120 claims in the U.S. ranging from $0.5 to $13 million per claim, with 102 claims at an early stage where the loss amount cannot be reasonably estimated[42]. - The company may need to make substantial liability accruals for U.S. silicosis claims, which could adversely impact its balance sheet equity and financial obligations[43]. - Compliance with evolving privacy laws and regulations may result in significant liability and negative publicity, impacting revenues and financial condition[36]. - The company faces potential fines and lawsuits due to non-compliance with privacy laws such as the California Consumer Privacy Act (CCPA) and the General Data Protection Regulation (GDPR) in the U.S. and Europe, respectively[127]. - The company anticipates increased regulatory scrutiny and costs due to amendments to the Privacy Protection Law (PPL) in Israel, effective in 2025[128]. - Regulatory changes regarding the use of silica-containing products may lead to increased operational costs and potential litigation risks, adversely affecting financial performance[55]. - The company may incur significant costs and liabilities due to compliance with environmental, health, and safety regulations, which could adversely affect financial results[144]. - The company has faced compliance issues related to environmental and health regulations, which could lead to additional unforeseen expenditures[148]. Economic and Market Conditions - The company is subject to significant risks from macroeconomic downturns, geopolitical instability, and intense competitive pressures that could adversely affect its financial results[33][34]. - Economic downturns and high inflation have led to reduced consumer demand for new homes and renovations, negatively impacting the company's sales[57]. - In 2024, the company's revenues in Australia declined by 28.8%, attributed to new laws banning engineered stone slabs containing crystalline silica, which may adversely impact financial results[52]. - Approximately 60%-70% of the company's revenue in principal markets (U.S., Australia, Canada) is related to residential renovations and remodeling activities, while 30%-40% is from new construction[56]. - The company faces intense competitive pressures, with competitors potentially producing similar products at lower costs, impacting market share and pricing power[61]. - The imposition of antidumping and countervailing duties has increased competitive pressures in markets like Australia, where the company holds a higher market share[66]. Supply Chain and Production Challenges - Supply chain disruptions have been experienced globally, affecting the availability of essential raw materials, particularly minerals and porcelain[85]. - The company actively manages its global supply chain and production facilities in Israel and India, but faces risks related to supplier insolvency and delays[82]. - The company relies on a limited number of suppliers for raw materials, with 84.4% of revenues concentrated in four key markets: the United States (49.5%), Australia (17.0%), Canada (13.9%), and Israel (3.9%)[106]. - The company is facing potential disruptions in supply chains due to geopolitical tensions, particularly between Turkey and Israel, which may require finding alternative suppliers[103]. - The company relies on a limited number of large retailers for sales, and any deterioration in relationships with these retailers could significantly impact revenue[92]. Financial Performance and Impairments - The company recognized an impairment charge of $3.2 million in 2024 due to a slowdown in demand and integration challenges from acquired businesses[100]. - The company recorded a non-cash goodwill impairment charge of $44.8 million in fiscal year 2022, fully impairing the goodwill balance[172]. - In 2023, the company recognized an impairment of $28.5 million related to the Richmond Hill facility and $16.6 million related to the right of use asset at the Sdot Yam facility[173]. - For 2024, the company recorded an impairment of $3.8 million related to the Richmond Hill facility and $3.2 million related to intangible assets associated with Omicron and Magrab[174]. - The company may experience additional impairments in the future if adverse changes occur in key assumptions or market conditions[176]. Corporate Governance and Shareholder Issues - As of February 28, 2025, the Kibbutz and Tene owned 14,029,494 ordinary shares, constituting 40.6% of the company's outstanding shares, which may limit other shareholders' influence on corporate matters[181]. - The company had 34,555,827 shares outstanding as of February 28, 2025, with 5,775,000 shares reserved for issuance under its option plans[184][186]. - The exclusive forum provision in the company's articles of association may limit shareholders' ability to bring claims in a judicial forum of their choice, potentially discouraging lawsuits[211]. - The company may lose its foreign private issuer status if a majority of its voting securities are owned by U.S. residents or if a majority of its executive officers or directors are U.S. citizens or residents[191]. Operational and Management Challenges - The company is dependent on its senior management team, and recent changes in leadership may impact business operations[222]. - The company has experienced a trend of relatively high turnover in some sites and roles, which could affect operational stability[223]. - The company does not carry key man insurance for its executive officers, which poses a risk to operational continuity[223]. - The competitive market for qualified personnel may hinder the company's ability to attract and retain talent, affecting growth[224]. Strategic Initiatives and Future Outlook - The company is implementing a digital transformation to enhance supply chain management and production processes, which is critical for operational efficiency[118]. - The company is expanding its distribution network in the United States, particularly in the South, Southeast, and Ohio Valley markets through the Omicron Acquisition[107]. - The company estimates that engineered surfaces represented 24% of total countertops by volume installed in the United States in 2024, indicating growth potential in this market[108]. - Future product introductions may involve uncertainties and challenges that could adversely affect margins and operational results[87]. Risks from Geopolitical and Environmental Factors - The ongoing military conflicts in Israel, particularly with Hamas and Hezbollah, may adversely affect the company's operations and limit its ability to market products, potentially leading to decreased revenues[193]. - The Israeli government has downgraded Israel's credit rating due to the continuation of the war, which could impact the company's financial standing[197]. - The company’s commercial insurance does not cover losses from war and terrorism, which could lead to material adverse effects on its business if damages occur[198]. - The company has been affected by political tensions, such as disruptions in commercial arrangements with Turkish suppliers, which may require finding alternative solutions for its supply chain[199].

Financial Data and Key Metrics Changes - Fourth quarter revenue was $97.9 million, a decline of 23.8% year-over-year on a constant currency basis, reflecting lower sales volume across markets [15][16] - Gross margin improved to 19.4%, up 130 basis points year-over-year, driven by restructuring actions and optimized production [13][17] - Full year 2024 sales were $443.2 million, down from $565.2 million in 2023, with a constant currency decline of 21.5% [20] Business Line Data and Key Metrics Changes - In the US, sales decreased by 23.1% to $46.4 million, attributed to softer market conditions [16] - Canada sales fell by 18.5% on a constant currency basis, reflecting similar dynamics as the US [16] - Australia experienced a 37.5% decline in sales on a constant currency basis, mainly due to market transitions [16] - Israel saw a significant improvement with sales up 53.6% on a constant currency basis, benefiting from improved market conditions [16] Market Data and Key Metrics Changes - The EMEA region reported an 18.2% decline on a constant currency basis, impacted by slow market conditions in the UK [16] - Overall, the company faced persistent global market headwinds affecting revenue across all major markets [15][16] Company Strategy and Development Direction - The company is focused on strategic transformation initiatives, optimizing operational frameworks, and enhancing competitive positions through R&D and marketing investments [8][9] - Plans to acquire the remaining equity interest in Lioli Ceramica to increase ownership to 100% as part of growth strategy in the porcelain market [12] - The company expects to realize incremental cost savings of approximately $10 million in 2025 from restructuring initiatives [27] Management Comments on Operating Environment and Future Outlook - Management noted ongoing challenges in the global market but expressed confidence in the strategic initiatives leading to improved agility and efficiency [14][29] - Anticipated gradual improvement in revenues as the year progresses, with expectations for Q1 to reflect similar dynamics as Q4 [33][36] - The company remains focused on maintaining disciplined working capital management to maximize cash flow [28] Other Important Information - The company recorded a provision of $50 million for silicosis claims, with ongoing legal challenges in the US, Australia, and Israel [25][26] - Positive free cash flow of $31.9 million for the full year, maintaining a healthy financial position with a net cash position of $101.8 million [24] Q&A Session Summary Question: Update on end markets and revenue perspective for Q1 - Management sees Q1 reflecting the same market dynamics as Q4, with expectations for gradual improvement in Q2 and Q3 [33][34] Question: Clarification on revenue decline levels - Q1 is expected to show similar decline levels as Q4, with gradual improvement anticipated as the year progresses [36] Question: Insights on pricing pressures - Pricing pressure is evident, particularly in Australia, but is not the most significant factor affecting revenue declines [38] Question: Expected dollar amount of savings from initiatives - Total savings are expected to exceed $45 million compared to 2022, with incremental savings of around $10 million in 2025 [40]

Financial Data and Key Metrics Changes - Fourth quarter revenue was $97.9 million, a decline of 23.8% year-over-year on a constant currency basis, reflecting lower sales volume across markets [15][20] - Gross margin improved to 19.4%, up 130 basis points year-over-year, driven by restructuring actions and an optimized production footprint [13][17] - Full year 2024 sales were $443.2 million, down from $565.2 million in 2023, with a constant currency decline of 21.5% [20] Business Line Data and Key Metrics Changes - The porcelain business is viewed as a significant growth driver, with plans to acquire the remaining equity interest in Lioli Ceramica in the first half of 2025 [12] - The crystalline silica-free product line is being expanded globally, with full collection availability expected in Australia by the end of Q1 2025 [11] Market Data and Key Metrics Changes - In the US, sales decreased by 23.1% to $46.4 million, attributed to softer market conditions [16] - Canada sales fell by 18.5%, while Australia experienced a 37.5% decline, reflecting slower market conditions and regulatory transitions [16] - Israel saw a sales increase of 53.6%, benefiting from improved market conditions post-conflict [16] Company Strategy and Development Direction - The company is focused on strategic transformation initiatives, optimizing operational frameworks, and enhancing competitive positions through investments in R&D and marketing [8][9] - Continued emphasis on maintaining financial flexibility with a strong balance sheet and net cash position of $101.8 million [9][24] Management's Comments on Operating Environment and Future Outlook - Management expects Q1 2025 to reflect similar market dynamics as Q4 2024, with gradual improvement anticipated in Q2 and Q3 [33][36] - The company is optimistic about achieving modest improvement in adjusted EBITDA for full year 2025, driven by cost optimization initiatives [27][29] Other Important Information - The company recorded a provision of $50 million for silicosis claims, with ongoing legal challenges in the US, Australia, and Israel [25][26] - Positive operating cash flow of $31.9 million for the full year 2024, down from $66.5 million in the prior year, driven by improvements in working capital [23][24] Q&A Session Summary Question: Update on end markets and revenue perspective for Q1 - Management sees Q1 reflecting the same market dynamics as Q4, with expectations for gradual improvement as the year progresses [33][34] Question: Clarification on revenue decline levels - Q1 is expected to show similar decline levels as Q4, with hopes for less decline as the year moves on [35][36] Question: Pricing pressure impact on revenue decline - Pricing pressure is evident, particularly in Australia, but is not the most significant factor; market conditions and inflation are leading to project deferrals [37][38] Question: Expected savings from initiatives - Total savings are projected to exceed $45 million compared to 2022, with incremental savings of around $10 million expected in 2025 [39][40]

Financial Data and Key Metrics Changes - Global revenue for Q3 2024 was $107.6 million, down 24.8% on a constant currency basis, primarily due to lower volumes impacted by global economic headwinds [12] - Gross margin improved to 19.9% compared to 19.1% in the prior year quarter, with adjusted gross margin stable at 19.8% [15] - Operating expenses were $25.4 million or 23.6% of revenue, compared to $29.2 million or 20.5% in the prior year quarter [16] - Adjusted EBITDA for Q3 was a loss of $4.1 million compared to a gain of $1.9 million in the prior year quarter [17] - Cash and short-term deposits at quarter end were $114.1 million, with total debt of $5.2 million, improving net cash position to $108.9 million from $83.5 million at the end of 2023 [18] Business Line Data and Key Metrics Changes - U.S. sales decreased by 20.5% to $52.4 million, primarily due to softer residential end markets [13] - Canada sales were down 23.8% on a constant currency basis, reflecting similar market dynamics as the U.S. [14] - Australia sales declined approximately 37.7% on a constant currency basis, impacted by slower market conditions and regulatory transitions [14] - EMEA region saw a decline of 26% on a constant currency basis due to slow market conditions in the U.K. and Sweden [14] - Israel sales were off by 24.5% on a constant currency basis, mainly due to the war on terror affecting regional activity [14] Market Data and Key Metrics Changes - The renovation and remodeling market remains pressured by high interest rates and economic uncertainty, particularly affecting residential activity [9] - Commercial and big box business showed relative stability compared to residential activity [9][32] - The transition to zero crystalline silica products in Australia is taking longer than expected, with full market availability anticipated by the end of Q1 2025 [10][28] Company Strategy and Development Direction - The company is focusing on operational efficiency and strategic investments to strengthen its competitive position [10] - Ongoing transformation efforts and manufacturing optimization initiatives have helped sustain gross margin improvement despite lower revenues [7] - The company is pursuing opportunities to maximize value from remaining undeveloped land at the Richmond Hill facility [8][33] Management Comments on Operating Environment and Future Outlook - Management expects market headwinds to persist in the near term but is confident in structural improvements made to the business [11] - The company anticipates lower sequential revenues in Q4 compared to Q3, consistent with typical seasonal trends [25] - Adjusted EBITDA outlook is revised to an expected loss in the range of $10 million to $11 million due to macroeconomic pressures and elevated shipping costs [26] Other Important Information - The company recorded a provision related to bodily damages claims made by fabricators in the U.S., with ongoing litigation that may impact financial position [21][23] - The company expects to realize approximately $35 million in restructuring-related cost savings compared to 2023 levels [24] Q&A Session Summary Question: Macro outlook by region and recovery trends - Management noted a negative trend in almost all markets due to economic downturns and competition, but expressed confidence in the company's agility and restructuring efforts [27] Question: Impact of shipping rates on pricing - Management stated that pricing changes are infrequent and that they have suffered from shipping rate increases, but expect to benefit from recent downturns in shipping costs starting in Q1 [30] Question: Trends in U.S. big box retailers - Management observed more resilience in big box retailers compared to the residential renovation market [31] Question: Updates on Richmond Hill land and Sdot-Yam subletting timeline - Management confirmed the completion of the undeveloped land sale and ongoing search for buyers for developed land, with Sdot-Yam subletting on track [33]

Revenue Performance - Revenue for Q3 2024 was $107.6 million, down 24.8% year-over-year on a constant currency basis, primarily due to lower volumes impacted by global economic headwinds [4]. - Revenues for Q3 2024 were $107,634 thousand, a decrease of 24.4% compared to $142,394 thousand in Q3 2023 [25]. - Total revenues for Q3 2024 decreased by 24.4% year-over-year to $107.634 million, compared to $142.394 million in Q3 2023 [36]. - Total revenues for the nine months ended September 30, 2024, were $345.358 million, a decrease of 20.9% compared to $436.706 million for the same period in 2023 [36]. - Revenue from the USA dropped by 20.5% year-over-year to $52.388 million in Q3 2024, down from $65.880 million in Q3 2023 [36]. - Revenue from Canada decreased by 25.1% year-over-year to $14.207 million in Q3 2024, compared to $18.956 million in Q3 2023 [36]. - Latin America experienced a significant decline of 85.5% year-over-year in Q3 2024, with revenues falling to $239, down from $1.650 million in Q3 2023 [36]. - Revenue from Australia fell by 36.2% year-over-year to $17.443 million in Q3 2024, compared to $27.326 million in Q3 2023 [36]. - The APAC region saw a revenue decline of 29.9% year-over-year in Q3 2024, totaling $23.878 million, down from $34.073 million in Q3 2023 [36]. - EMEA revenues decreased by 23.4% year-over-year to $11.627 million in Q3 2024, compared to $15.185 million in Q3 2023 [36]. - Revenue from Israel dropped by 20.4% year-over-year to $5.295 million in Q3 2024, down from $6.650 million in Q3 2023 [36]. - The company reported a year-over-year decline in total revenues across all major regions, indicating a challenging market environment [36]. Profitability and Loss - Gross margin improved to 19.9% in Q3 2024, compared to 19.1% in the prior year quarter, driven by an optimized production footprint [5]. - Operating loss for Q3 2024 was $4.1 million, compared to a loss of $2.0 million in the prior year quarter, reflecting lower gross profit [7]. - Net loss attributable to controlling interest was $4.2 million, with a net loss per share of $0.12, compared to a net loss of $0.9 million and $0.03 per share in the prior year [9]. - Gross profit for Q3 2024 was $21,366 thousand, down 21.5% from $27,189 thousand in Q3 2023 [25]. - Adjusted Gross profit for Q3 2024 was $21,290 thousand, down 24.5% from $28,135 thousand in Q3 2023 [29]. - Operating loss for Q3 2024 was $4,074 thousand, compared to a loss of $1,987 thousand in Q3 2023, indicating a worsening of 105.4% [25]. - Net loss attributable to controlling interest for Q3 2024 was $4,222 thousand, compared to a loss of $887 thousand in Q3 2023, reflecting an increase of 376.5% [33]. - Full year Adjusted EBITDA loss is now expected to be in the range of $10 to $11 million due to persistent macroeconomic pressures [13]. Cash Flow and Financial Position - Positive cash flow from operations was $16.3 million in Q3 2024, down from $28.2 million in Q3 2023, mainly due to the land sale and working capital improvements [11]. - The net cash position improved to $108.9 million as of September 30, 2024, compared to $83.5 million as of December 31, 2023 [11]. - Cash and cash equivalents at the end of Q3 2024 were $114,077 thousand, up from $78,086 thousand at the end of Q3 2023, representing a 46.1% increase [28]. - Net cash provided by operating activities for the nine months ended September 30, 2024, was $34,985 thousand, a decrease from $53,336 thousand in the same period of 2023 [28]. Operating Expenses - Operating expenses were $25.4 million, or 23.6% of revenue, up from 20.5% in the prior year quarter, mainly due to lower revenues [6]. - Total operating expenses for Q3 2024 were $25,440 thousand, down from $29,176 thousand in Q3 2023, a decrease of 9.4% [25]. - Research and development expenses for Q3 2024 were $1,192 thousand, slightly down from $1,242 thousand in Q3 2023 [25]. - The company expects to achieve restructuring-related cost savings of approximately $20.0 million for the full year 2024 [13]. Inventory Management - The company reported a decrease in inventories of $25,975 thousand for the nine months ended September 30, 2024, compared to a decrease of $91,329 thousand in the same period of 2023 [28]. - The company is actively seeking to monetize additional property assets, including 51 acres of developed land [10].

Company Overview & Strategy - Caesarstone's revenue in 2023 was approximately $565 million [4] - The company is shifting from a production-focused to a brand-centric business model [6] - Caesarstone is evolving from a countertop player to a surfaces player, expanding its product offerings [6, 7] - A strategic restructuring plan is in place to improve growth, including agreements with key production partners and shifting production capacity [18] Financial Performance & Savings - Strategic restructuring plan is expected to generate annualized savings of over $40 million [21] - Working capital reduction is expected to be greater than $100 million [19] - In Q2 2024, revenue was $119.4 million compared to $143.7 million in Q2 2023 [29] - Adjusted gross margin in Q2 2024 was $28.4 million, a 106% increase compared to $13.8 million in Q2 2023 [29] Market Presence & Opportunities - Caesarstone products are available in over 60 countries worldwide [4, 22] - In 2022, Engineered Quartz accounted for 18% of the global countertop market, valued at $160 billion [23] - The U S market for Engineered Quartz was valued at $10.1 billion in 2022 [24]