Acquisition and Expansion - The Company closed the acquisition of Arrowrock Supply in January 2025, expanding its reach into the Inter-Mountain region of the United States [60]. - The Wholesale Segment serves approximately 7,900 retail outlets and distributes over 20,000 different consumer products, ranking as the third largest convenience store distributor by geographic territory served [72]. Financial Performance - Consolidated sales for Q2 2025 were $619.5 million, a 2.9% increase from $601.9 million in Q2 2024 [76]. - Consolidated sales for Q2 2025 were $1,330.8 million, an increase of $83.9 million or 6.7% compared to Q2 2024 [87]. - Gross profit for Q2 2025 was $43.0 million, with a gross profit percentage of 6.9%, down from 7.0% in Q2 2024 [76]. - Gross profit for Q2 2025 was $89.9 million, reflecting a $4.3 million increase or 5.0% from Q2 2024 [87]. - Operating income for Q2 2025 was $461,905, a significant decrease of 86.2% compared to $3.3 million in Q2 2024 [76]. - Net income available to common shareholders for Q2 2025 was a loss of $1.2 million, a decrease of $2.9 million or 177.1% from Q2 2024 [87]. - Wholesale segment sales increased by $83.4 million to $1,308.3 million in the six months ended March 2025, a 6.8% increase year-over-year [90]. - Gross profit in the Wholesale Segment for the six months ended March 2025 rose by $4.2 million, totaling $81.7 million [91]. Operating Costs and Expenses - The Wholesale Segment sales increased by $16.9 million in Q2 2025, driven by a $5.6 million contribution from the Arrowrock acquisition and a $25.3 million increase from price hikes by cigarette manufacturers [79]. - The Retail Segment sales rose by approximately $0.7 million in Q2 2025, attributed to a new store opening and higher sales volumes [79]. - Operating expenses increased by $3.6 million to $85.8 million in Q2 2025, a rise of 9.4% compared to Q2 2024 [84]. - Operating expenses for the six months ended March 2025 increased by $7.3 million to $85.8 million, driven by acquisitions and operational costs [94]. Economic and Regulatory Environment - The Company is facing inflationary pressures leading to higher operating costs, impacting product costs, labor, and employee benefits [61]. - The Company is closely monitoring proposed tariffs and regulatory actions that could negatively impact revenues and gross margins [62]. - A precipitous change in the operating environment could materially impact the Company's future revenue streams [110]. - The Company may face challenges in collecting on customer accounts receivable or securing bank credit [110]. - There are no applicable quantitative and qualitative disclosures about market risk [111]. Liquidity and Debt - Interest expense for Q2 2025 increased by less than $0.1 million, primarily due to higher debt balances from acquisitions [85]. - The company had a total combined borrowing capacity of $305.0 million as of March 2025, with $142.3 million outstanding [100]. - The average interest rate on the company's facilities was 5.76% at March 2025 [104]. - The Company believes its liquidity position will be adequate to sustain operations in both the short- and long-term [110].

Financial Performance - AMCON reported a fully diluted loss per share of $2.58, with a net loss available to common shareholders of $1.6 million for the second fiscal quarter ended March 31, 2025[2]. - For the three months ended March 31, 2025, the net loss available to common shareholders was $1,589,960, compared to a net income of $539,543 for the same period in 2024[14]. - The company reported a net cash flow from operating activities of $(5,449,633) for the three months ended March 31, 2025, significantly down from $53,757,153 in the prior year[17]. - Total sales for the three months ended March 2025 were $619.5 million, compared to $601.9 million for the same period in 2024, reflecting an increase of approximately 2.1%[12]. - The cost of sales for the quarter was $576.5 million, leading to a gross profit of $43.0 million, which is an increase from $42.3 million in the prior year[12]. - Shareholders' equity as of March 31, 2025, was reported at $111.4 million, a slight decrease from $111.7 million in September 2024[4]. Operational Highlights - The wholesale distribution segment generated revenues of $607.6 million and operating income of $2.8 million, while the retail health food segment reported revenues of $11.9 million and operating income of $0.4 million for the same quarter[3]. - The company has become the third largest Convenience Distributor in the U.S. by territory covered, enhancing its operational capabilities[3]. - AMCON's foodservice programs are positioned to provide retail partners with competitive advantages against the Quick Service Restaurant industry[3]. - AMCON is investing in a new 250,000 square foot distribution facility in Colorado City, Colorado, to support growth initiatives in the Intermountain Region[4]. Strategic Initiatives - The company continues to seek strategic acquisition opportunities to enhance its customer-focused approach and integrate recent acquisitions[3]. - The company acquired Arrowrock Supply for $6,131,527 during the three months ended March 31, 2025[17]. - AMCON's customer-centric approach is designed to ensure consistent and timely delivery of goods and services, particularly during challenging weather conditions[3]. Financial Changes - Depreciation expenses increased to $4,824,777 in March 2025 from $4,239,707 in March 2024[17]. - Total cash at the end of the period was $685,854, down from $951,521 at the end of March 2024[17]. - The company paid dividends on common stock amounting to $413,096 in March 2025, compared to $403,432 in March 2024[17]. - Equity-based compensation increased to $1,275,724 in March 2025 from $1,210,685 in March 2024[17]. - The balance of retained earnings as of March 31, 2025, was $106,897,928, compared to $106,053,510 as of March 31, 2024[14]. - The company reported a significant change in inventories, with a decrease of $13,324,448 in March 2025 compared to an increase of $37,236,124 in March 2024[17]. - Borrowings under revolving credit facilities increased to $1,262,647,310 in March 2025 from $1,128,853,805 in March 2024[17].

Core Insights - AMCON Distributing Company's shares have declined 4.6% since the earnings report for the quarter ended December 31, 2024, contrasting with a 0.9% growth in the S&P 500 index during the same period [1] - The company reported earnings per share (EPS) of 57 cents, down from $1.78 a year earlier, while net sales increased by 10.3% to $711.3 million [2] - Net income available to common shareholders fell by 67.5% to $0.4 million, primarily due to higher interest expenses and increased operating costs [3] Financial Performance - Revenue growth was driven by increased sales volume across product categories, including beverages, tobacco, and foodservice offerings, with excise taxes included in sales rising to $143.4 million from $138.1 million year-over-year [4] - Gross profit improved by 8.3% to $46.9 million, but gross margin slightly contracted to 6.6% from 6.7% in the prior-year period [5] - Operating expenses surged by 9.5% year-over-year to $43.2 million, while interest expenses rose by 23.1% to $2.9 million [5] Balance Sheet Analysis - As of December 31, 2024, shareholders' equity increased to $112.4 million from $111.7 million at the end of September 2024, while cash decreased to $0.5 million from $0.7 million [6] - Inventory levels rose significantly to $174.5 million from $144.3 million, indicating higher working capital requirements [6] Strategic Initiatives - Management emphasized a commitment to supporting retail partners with advanced logistics and innovative foodservice solutions, particularly during challenging weather conditions [7] - The strategic importance of Henry's Foods, a subsidiary specializing in proprietary foodservice programs, was highlighted, with enhancements in advertising and electronic display offerings [8] Acquisition and Growth Plans - AMCON completed the acquisition of Arrowrock Supply, a distributor based in Boise, Idaho, which is expected to strengthen its footprint in the Intermountain Region [9] - The company is investing in a new 250,000-square-foot distribution facility in Colorado City, CO, to support growth initiatives [9] Liquidity and Credit Management - AMCON continues to prioritize liquidity and balance sheet management, with borrowing under revolving credit facilities increasing to $165.9 million from $121.3 million at the end of September 2024 [10]

Financial Performance - The Company reported consolidated sales of $711.3 million for Q1 2025, an increase of 10.3% compared to $645.0 million in Q1 2024[77] - Gross profit for the Company was $46.9 million, reflecting an 8.3% increase from $43.3 million in the previous year[77] - Operating income decreased by 4.0% to $3.7 million, down from $3.8 million in Q1 2024[77] - Net income available to common shareholders fell significantly by 67.5% to $348,419 compared to $1.1 million in the prior year[77] Segment Performance - The Wholesale Segment's sales increased by $66.5 million, driven by $56.7 million from acquisitions and $29.2 million from price increases in cigarette products[80] - The Retail Segment experienced a slight decrease in sales of $0.2 million, attributed to the closure of three stores, partially offset by new store openings[80] - Gross profit in the Wholesale Segment increased by $3.8 million in Q1 2025 compared to Q1 2024, driven by acquisitions and product mix[84] - Gross profit in the Retail Segment decreased by $0.2 million in Q1 2025, primarily due to the closure of three stores[84] Operating Costs and Expenses - The Company continues to face inflationary pressures impacting operating costs, particularly in labor and product costs[62] - Operating expenses increased by $3.7 million in Q1 2025 compared to Q1 2024, with significant increases related to acquisitions and health insurance costs[85] - Interest expense rose by $0.5 million in Q1 2025, primarily due to higher outstanding debt from acquisitions and increased capital expenditures[86] Liquidity and Borrowing - The total combined borrowing capacity of the Facilities was $305.0 million as of December 2024, with $165.9 million outstanding[91] - The average interest rate of the Facilities was 5.96% at December 2024, with peak borrowings reaching $197.1 million[93] - The liquidity position is influenced by working capital levels and access to bank credit, with no current hedging against interest rate or fuel cost risks[99] - The Company believes its liquidity position will be adequate for operations, but significant changes in the operating environment could impact future revenue streams[100] Strategic Initiatives - Integration efforts for the acquisitions of Burklund Distributors and Richmond Master are ongoing, aimed at geographic expansion and enhancing product offerings[64] - The Company operates 14 distribution centers across 34 states, serving approximately 7,900 retail outlets[73] Regulatory Risks - Regulatory risks related to potential limitations on tobacco product sales by the FDA could negatively impact revenues and consumer demand[63] Dividends and Financial Management - The Company declared a special dividend of $0.28 per share totaling approximately $0.2 million during Q1 2025, to be paid in Q2 2025[95] - The Company issued letters of credit totaling $2.0 million as part of its self-insured loss control program[97]

Financial Performance - Fully diluted earnings per share of $0.57 on net income available to common shareholders of $0.3 million for the first fiscal quarter ended December 31, 2024[2] - Sales for the three months ended December 2024 were $711.3 million, compared to $645.0 million in the same period in 2023[10] - Gross profit for the three months ended December 2024 was $46.9 million, compared to $43.3 million in the same period in 2023[10] - Net income available to common shareholders for the three months ended December 2024 was $348,419, compared to $1,070,961 in the same period in 2023[10] - Net income available to common shareholders decreased to $348,419 in December 2024 from $1,070,961 in December 2023, a significant decline[14] Balance Sheet and Assets - Shareholders' equity at December 31, 2024 was $112.4 million[3] - Total assets at December 31, 2024 were $404.7 million, compared to $374.1 million at September 30, 2024[8] - Total current assets at December 31, 2024 were $258.1 million, compared to $229.1 million at September 30, 2024[8] - Inventories, net at December 31, 2024 were $174.5 million, compared to $144.3 million at September 30, 2024[8] Cash Flow and Financing - Net cash flows from operating activities were negative at $(39,867,877) in December 2024 compared to $4,996,124 in December 2023[14] - Net cash flows from financing activities improved to $43,172,220 in December 2024 from $(968,020) in December 2023[14] - Borrowings under revolving credit facilities rose to $713,853,301 in December 2024 from $603,650,771 in December 2023[14] - Cash paid for interest increased to $2,815,683 in December 2024 from $2,235,562 in December 2023[14] - Dividends declared but not paid increased to $180,729 in December 2024 from $176,501 in December 2023[14] - Cash at the end of the period decreased to $535,862 in December 2024 from $996,695 in December 2023[14] Depreciation and Equipment - Depreciation increased to $2,501,175 in December 2024 from $2,084,743 in December 2023[14] - Equipment acquisitions classified in accounts payable rose to $772,820 in December 2024 from $347,891 in December 2023[14] Inventory and Working Capital - Inventory changes showed a significant outflow of $(30,293,089) in December 2024 compared to an inflow of $384,466 in December 2023[14] Strategic Investments and Acquisitions - The company completed the acquisition of Arrowrock Supply of Boise, Idaho[3] - The company is investing capital to develop a 250,000 square foot distribution facility in Colorado City, Colorado[3]

Core Insights - AMCON Distributing Company reported a significant decline in earnings per share (EPS) to $7.15 for fiscal year 2024, down from $19.46 in the previous year, despite total revenues increasing to $2.7 billion from $2.5 billion [1][2] Financial Performance - The company's net income available to common shareholders decreased to $4.3 million from $11.6 million in the previous fiscal year [8] - Operating income fell to $18 million, a 30.8% decline from $26 million in fiscal 2023, primarily due to rising selling, general, and administrative (SG&A) expenses [6] - Interest expenses increased to $10.4 million from $8.6 million, reflecting higher debt levels used for financing expansions and acquisitions [7] Revenue Segments - The wholesale distribution segment generated revenues of $2.7 billion with an operating income of $31.3 million, indicating effective scale expansion and operational efficiency [3] - The retail health food segment reported revenues of $42.5 million but only a marginal operating income of $0.1 million, highlighting profitability challenges [4] Profitability Metrics - AMCON's gross profit improved to $182.4 million, up from $170.8 million, marking a 6.7% increase, which reflects better management of the cost of sales [5] - The gross profit margin showed slight enhancement, indicating improved alignment between sales and cost of goods sold [5] Balance Sheet Overview - Total assets increased to $374.1 million from $363.4 million, while cash decreased to $0.7 million from $0.8 million [8] - Long-term debt rose to $16.6 million from $11.7 million, and current maturities of long-term debt increased from $2 million to $5.2 million [9] - Shareholders' equity increased to $111.7 million from $104.2 million [9] Cash Flow and Operational Activities - Net cash provided by operating activities significantly improved to $67.9 million from $19.7 million in fiscal 2023 [10] Strategic Developments - AMCON is expanding its operations with new facilities and acquisitions, including a new facility in Springfield, MO, and investments in the Colorado City distribution center [11] - The company is focusing on enhancing foodservice capabilities through its subsidiary, Henry's Foods, integrating advanced advertising and merchandising solutions to compete in the Quick Service Restaurant industry [12]

Financial Performance - Sales for fiscal 2024 reached $2,711.0 million, an increase of $171.0 million compared to $2,540.0 million in fiscal 2023[148]. - Gross profit for fiscal 2024 was $182.4 million, maintaining a gross profit percentage of 6.7%[148]. - Operating income decreased to $18.0 million in fiscal 2024 from $26.0 million in fiscal 2023, reflecting a decline in operating income margin from 1.0% to 0.7%[147]. - Net income available to common shareholders fell to $4,336,489 in fiscal year 2024, down 62.7% from $11,596,393 in fiscal year 2023[225]. - Basic earnings per share decreased to $7.24 in fiscal year 2024 from $19.85 in fiscal year 2023, a decline of 63.5%[225]. - Total sales for fiscal year 2024 reached $2,710,981,108, an increase of 6.7% compared to $2,539,994,999 in fiscal year 2023[225]. - Operating income decreased to $17,980,514 in fiscal year 2024 from $25,966,583 in fiscal year 2023, indicating a decline of 30.7%[225]. - The company reported a loss from operations before taxes of $7,462,489 for fiscal year 2024, a decline from a profit of $17,302,393 in fiscal year 2023[328][329]. Acquisitions and Investments - The company acquired Burklund Distributors, Inc. and Richmond Master Distributors, Inc., contributing to a $98.6 million increase in sales from these acquisitions[151]. - The Company acquired Burklund Distributors, Inc. for approximately $20.9 million, consisting of $15.4 million in cash and a $3.9 million promissory note[273]. - The Company acquired Richmond Master Distributors, Inc. for approximately $6.6 million in cash, assuming operating liabilities of about $0.6 million[274]. - The acquisition of Burklund aligns with the Company's long-term growth strategy by expanding its regional footprint[273]. - The total consideration paid for the acquisition of Burklund and Richmond Master was $27,573,880, with cash payments of $22,095,436[276]. - The acquisition of Henry's Foods, Inc. involved a cash payment of approximately $54.9 million and the assumption of operating liabilities totaling approximately $1.2 million[281]. - Total identifiable net assets acquired from Henry's Foods amounted to $54,364,928, including accounts receivable of $8,237,652 and inventories of $16,060,965[283]. - The pro forma revenue for the year ended September 2024, assuming the acquisitions of Burklund, Richmond Master, and Henry's, is projected to be $2,854,752,348[286]. Financial Position and Liquidity - The total combined borrowing capacity of the company's credit facilities is $300.0 million, with $121.3 million outstanding as of September 2024[164]. - The average interest rate on the company's credit facilities was 6.82% at September 2024, with peak borrowings reaching $181.8 million during fiscal 2024[165]. - The Company believes its liquidity position will be adequate for operations, but a significant change in the operating environment could impact future revenue streams[171]. - The Company has no off-balance sheet arrangements, indicating a straightforward financial structure[169]. - The Company’s liquidity position is influenced by customer credit risk and access to bank credit, with no current hedging against interest rate or fuel cost risks[170]. - Total current assets decreased to $229,065,271 in September 2024 from $245,670,707 in September 2023, a reduction of 6.8%[222]. - Total liabilities increased to $262,377,525 in September 2024 from $259,260,106 in September 2023, reflecting a rise of 1.1%[222]. - Shareholders' equity increased to $111,729,785 in September 2024 from $104,169,094 in September 2023, an increase of 7.2%[222]. Operational Costs and Expenses - Operating expenses increased by $19.5 million in fiscal 2024, driven by higher costs associated with acquisitions and employee compensation[156]. - Interest expense rose by $1.9 million in fiscal 2024, primarily due to higher interest rates and increased debt from acquisitions[157]. - Cash paid for interest during the period was $9,985,313, compared to $8,311,375 in the previous year, reflecting an increase of approximately 20.1%[231]. - The Company made matching contributions to its profit-sharing plans of approximately $2.0 million in fiscal 2024, up from $1.6 million in fiscal 2023[317]. Revenue Recognition and Accounting Standards - The Company recognizes revenues when the performance obligation is satisfied, reflecting the consideration expected to be received[217]. - The occurrence and cutoff of revenue transactions were identified as a critical audit matter due to the significance of net sales[218]. - The Company adopted ASU 2016-13 on October 1, 2023, which introduced a forward-looking approach to estimate credit losses, with no material effect on consolidated financial statements[202]. - The Company is reviewing ASU No. 2023-07, which improves segment reporting disclosures, effective for fiscal 2025[203]. - The new FASB ASU No. 2023-09 will enhance income tax disclosures, effective for annual periods beginning after December 15, 2024[204]. - The Company is currently reviewing the potential impact of the new ASU on its consolidated financial statements[204]. Risks and Challenges - Risks associated with higher interest rates could impact demand, customer credit risk, profitability, and cash flows[207]. - The Company faces risks from supply chain disruptions and an intensely competitive labor market, leading to increased operational costs[208]. - The Company is subject to risks related to the acquisition of businesses or assets, including integration challenges and vendor retention[206]. - The Company reported that changes in trade tariffs may result in higher prices for products, affecting consumer demand[208]. Asset Management - Goodwill on the balance sheet was recorded at $5.8 million as of September 2024, with the estimated fair value of the wholesale reporting unit exceeding its carrying value[185]. - The Company performs annual goodwill and intangible asset impairment assessments during the fourth fiscal quarter[247]. - Goodwill and intangible assets with indefinite useful lives are not amortized but reviewed for impairment annually[247]. - The Company utilizes a discounted cash flow methodology for impairment testing, requiring significant judgment in estimating future cash flows[249]. - The total net deferred tax assets increased from $2,431,995 in September 2023 to $3,317,504 in September 2024, indicating a significant rise in deferred tax assets[311].

Financial Performance - AMCON reported fully diluted earnings per share of $7.15 and net income available to common shareholders of $4.3 million for the fiscal year ended September 30, 2024[1]. - Total sales for fiscal 2024 were $2.71 billion, an increase from $2.54 billion in fiscal 2023, representing a growth of approximately 6.7%[6]. - Gross profit for fiscal 2024 was $182.35 million, up from $170.84 million in fiscal 2023, indicating a gross margin improvement[6]. - Operating income decreased to $17.98 million in fiscal 2024 from $25.97 million in fiscal 2023, reflecting increased selling, general, and administrative expenses[6]. - Net income available to common shareholders decreased to $4,336,489 in September 2024 from $11,596,393 in September 2023, representing a decline of approximately 62.7%[9]. Revenue Segments - The wholesale distribution segment generated revenues of $2.7 billion with an operating income of $31.3 million, while the retail health food segment reported revenues of $42.5 million and operating income of $0.1 million for fiscal 2024[2]. Shareholder Equity and Cash Flow - Shareholders' equity increased to $111.73 million as of September 30, 2024, compared to $104.17 million in the previous year[5]. - AMCON's cash balance decreased to $672,788 from $790,931 year-over-year, while accounts receivable slightly decreased to $70.65 million[5]. - Net cash flows from operating activities significantly increased to $67,872,351 in September 2024, compared to $19,722,218 in September 2023, marking an increase of approximately 243.5%[9]. - Cash at the end of the period decreased to $672,788 in September 2024 from $790,931 in September 2023, a decline of approximately 15%[9]. Investments and Acquisitions - The company is investing in a new 250,000 square foot distribution facility in Colorado City, Colorado, to support growth initiatives in the Intermountain Region[3]. - The company acquired Burklund for $15,464,397 and Richmond Master for $6,631,039 during the period, indicating ongoing market expansion efforts[9]. - The company continues to seek strategic acquisition opportunities to align with its customer-focused approach and enhance its service capabilities[2]. Inventory and Accounts Receivable - Accounts receivable increased by $5,900,380 in September 2024, compared to a decrease of $(138,956) in September 2023, suggesting improved sales performance[9]. - The company reported a significant increase in inventories, rising to $29,003,285 in September 2024 from a decrease of $(7,728,394) in September 2023, indicating potential growth in product offerings[9]. Expenses and Cash Flow Management - Total depreciation expenses rose to $8,957,478 in September 2024, up from $7,161,468 in September 2023, reflecting an increase of about 25.1%[9]. - Cash paid for interest during the period was $9,985,313, compared to $8,311,375 in the previous year, indicating an increase of approximately 20.1%[9]. - The company reported a net cash outflow from investing activities of $(42,108,695) in September 2024, a decrease from $(66,274,842) in September 2023, showing an improvement of about 36.4%[9]. - The company experienced a net cash outflow from financing activities of $(2,320,299) in September 2024, compared to $(2,975,323) in September 2023, reflecting a reduction in financing costs[9]. Strategic Positioning - AMCON's strategic plan has led to becoming the third largest Convenience Distributor in the U.S. by territory covered, with a fully operational facility in Springfield, Missouri[2].

Sales Performance - Sales for the quarter reached $717.9 million, up from $696.5 million in the prior-year period, driven by strong demand in the convenience and foodservice distribution sectors [1] - The increase in sales was partially offset by the higher cost of goods sold, which rose to $669.9 million from $649.6 million in the third quarter of fiscal 2023 [1] Profitability Metrics - The company's gross profit for the third quarter of fiscal 2024 was $48 million, up from $46.9 million in the same quarter last year, with a stable gross profit margin of approximately 6.7% [2] - Operating income for the third quarter was $5.6 million, a decline from $7.9 million in the year-ago quarter, primarily due to higher SG&A expenses [3] - Net income available to common shareholders for the third quarter was $1.5 million, significantly lower than the $3.9 million reported in the year-ago quarter, reflecting the impact of higher interest expenses and other costs [4] Expense Analysis - SG&A expenses increased 8.3% year over year, reaching $39.9 million in the third quarter compared to $36.9 million in the prior-year quarter [5] - Interest expenses for the fiscal third quarter were $2.9 million, up from $2.4 million in the third quarter of fiscal 2023 [6] Balance Sheet Position - As of June 30, 2024, total assets for the company were $400.6 million, an increase from $363.4 million at the end of September 2023 [12] - Total shareholders' equity increased to $110 million from $104.2 million as of September 30, 2023 [13] - Long-term debt, excluding current maturities, was $17.9 million, an increase from $11.7 million at the end of September 2023, with current maturities of long-term debt standing at $5.3 million [8] Cash Flow and Investments - For the nine months ended June 30, 2024, the company generated net cash flows from operating activities of $26.9 million, a significant increase from $9.5 million in the same period of 2023 [14] - During the quarter, the company completed the acquisition of Richmond Master Distributors Inc., expected to strengthen its distribution network and customer base [15] - The company reported progress on its new 175,000-square-foot distribution facility in Springfield, MO, and enhancements to its 250,000-square-foot facility in Colorado City, CO [15]

Financial Performance - Consolidated sales for Q3 2024 reached $717.85 million, an increase of 3.1% from $696.49 million in Q3 2023[158] - Gross profit for Q3 2024 was $47.96 million, reflecting a 2.3% increase from $46.87 million in the same quarter last year[158] - Net income available to common shareholders decreased by 62.2% to $1.49 million, down from $3.94 million in Q3 2023[158] - The Wholesale Segment reported sales of $707.66 million, a 3.2% increase from $685.74 million in Q3 2023[158] - The Retail Segment experienced a sales decline of 5.1%, with Q3 2024 sales at $10.20 million compared to $10.75 million in Q3 2023[158] - Net income available to common shareholders decreased by 64.1% to $3.1 million in Q3 2024 compared to $8.6 million in Q3 2023[167] Operating Expenses - Operating expenses increased by 8.7% to $42.34 million, compared to $38.95 million in Q3 2023[158] - Operating expenses increased by $3.4 million in Q3 2024 compared to Q3 2023, primarily due to higher employee compensation and costs related to acquisitions[163] - Operating expenses increased by $16.6 million for the nine months ended June 2024 compared to the same prior year period, driven by a $10.6 million increase related to the acquisition of Henry's and a $3.2 million increase in employee compensation and benefits[199] Interest Expense - Interest expense increased by 21.7% to $2.90 million, compared to $2.39 million in Q3 2023, reflecting rising borrowing costs[158] - Interest expense rose by $0.5 million in Q3 2024 compared to Q3 2023, attributed to higher interest rates and increased debt from acquisitions[164] - Interest expense rose by $1.2 million for the nine months ended June 2024, primarily due to higher interest rates and increased capital expenditures related to acquisitions[220] Growth Initiatives - The company opened a new retail store in Lakewood Ranch, Florida, in June 2024, as part of its market expansion strategy[126] - The company is investing in a new 250,000 square foot distribution facility in Colorado City, Colorado, to support long-term growth initiatives[146] Regulatory Risks - Regulatory risks related to potential bans and limitations on tobacco products could negatively impact revenues and consumer demand[125] Wholesale Segment Performance - Sales in the Wholesale Segment increased by $21.9 million during Q3 2024 compared to Q3 2023, driven by acquisitions and price increases, despite a $45.7 million decrease in sales volume of cigarette cartons[160] - Gross profit in the Wholesale Segment rose by $1.2 million in Q3 2024 compared to Q3 2023, influenced by acquisitions and price increases, while the Retail Segment saw a slight decrease of approximately $0.1 million[162] - Sales in the Wholesale Segment increased by $117.5 million for the nine months ended June 2024 compared to the same prior year period, with significant contributions from acquisitions and price increases[195] - Gross profit in the Wholesale Segment increased by $10.3 million for the nine months ended June 2024 compared to the same prior year period, driven by acquisitions and price increases[196] Liquidity and Borrowing Capacity - The credit limit of the combined Facilities at June 2024 was $239.2 million, with $156.9 million outstanding, leaving $82.3 million available[177] - The total combined borrowing capacity of the Facilities was $300.0 million as of June 2024, including provisions for up to $30.0 million in credit advances for inventory purchases[222] - The average interest rate of the Facilities was 6.99% at June 2024, with peak borrowings reaching $181.8 million during the nine months ended June 2024[224] - The Company's liquidity position is significantly influenced by its ability to maintain sufficient levels of working capital and ongoing access to bank credit[226] Cash Dividends - The Company paid cash dividends totaling $0.5 million for the nine months ended June 2024, compared to $3.4 million for the same period in 2023[205] Store Closures - The Company experienced a $1.5 million decrease in revenue due to the closure of five stores between the comparative periods[198] Tax Rate Changes - The effective tax rate change during the nine-month period ended June 2024 was primarily related to non-deductible compensation expenses[200] Risk Management - The Company does not currently hedge its exposure to interest rate risk or fuel costs, which can significantly impact profitability[206]