Financial Performance - Net sales for Q1 2025 increased by 8.4% to $103.6 million, compared to $95.6 million in Q1 2024[6] - Gross profit for Q1 2025 rose by 8.4% to $40.8 million, maintaining a gross margin of 39.3%[9] - Net income for Q1 2025 was $6.8 million, up 5.2% from $6.5 million in the prior-year quarter, with a net income margin of 6.6%[11] - Adjusted EBITDA for Q1 2025 was $11.9 million, with an adjusted EBITDA margin of 11.5%, down from 14.2% in Q1 2024[12] - Free Cash Flow for Q1 2025 increased to $6,630,000, compared to $5,635,000 in Q1 2024, reflecting a 17.7% growth[24] - Diluted earnings per common share for Q1 2025 was $0.32, slightly up from $0.31 in Q1 2024[24] - Adjusted diluted earnings per common share decreased to $0.33 in Q1 2025 from $0.40 in Q1 2024[24] Operating Expenses - Operating expenses for Q1 2025 increased by 11.6% to $32.9 million, primarily due to higher shipping and transportation costs[10] - Total depreciation and amortization for Q1 2025 was $2,688,000, compared to $2,629,000 in Q1 2024[24] - Interest expense for Q1 2025 was $509,000, a slight decrease from $524,000 in Q1 2024[24] - The company reported a provision for income taxes of $2,121,000 in Q1 2025, up from $1,975,000 in Q1 2024[24] Cash and Liquidity - Cash and cash equivalents as of March 31, 2025, were $32.5 million, compared to $31.6 million at the end of 2024[22] - Cash from operating activities for Q1 2025 was $7,726,000, compared to $6,559,000 in Q1 2024[24] Future Outlook - The company expects net sales for Q2 2025 to increase by high single-digit to low double-digit percentages compared to the prior-year quarter[4] Dividend - The board approved a quarterly dividend of $0.45 per share, payable on or about May 23, 2025[14] Sourcing Strategy - The company reduced reliance on China for sourcing from approximately 20% at the end of 2024 to 15% in March 2025[3] Online Sales Growth - Online business sales increased nearly 20% during Q1 2025, contributing to overall growth[4] Non-GAAP Measures - The company utilized non-GAAP financial measures to provide additional clarity on its operating results, including Adjusted EBITDA and Free Cash Flow[26]

Core Viewpoint - Karat Packaging Inc. reported strong revenue growth in Q1 2025, with net sales increasing by 8.4% year-over-year, positioning the company well amid global trade uncertainties and supply chain challenges [1][3][5]. Financial Performance - Net sales for Q1 2025 reached $103.6 million, up from $95.6 million in Q1 2024, driven by a $11.7 million volume growth and a favorable product mix [5][7]. - Gross profit increased by 8.4% to $40.8 million, maintaining a gross margin of 39.3%, consistent with the prior year [7][9]. - Net income rose by 5.2% to $6.8 million, with a net income margin of 6.6% compared to 6.8% in the previous year [11][12]. - Adjusted EBITDA for Q1 2025 was $11.9 million, down from $13.5 million in Q1 2024, with an adjusted EBITDA margin of 11.5% [12][24]. Operational Highlights - The company reduced its reliance on China for sourcing from approximately 20% at the end of 2024 to 15% by March 2025, securing inventory from alternative sources [3][4]. - Online sales experienced a nearly 20% increase during the first quarter, reflecting the company's focus on expanding its market share [4][22]. - Operating expenses increased by 11.6% to $32.9 million, primarily due to higher shipping and transportation costs [10][19]. Guidance and Future Outlook - The company expects net sales for Q2 2025 to increase by high single-digit to low double-digit percentages compared to the prior year [7][12]. - Additional price increases are anticipated in mid-May 2025 due to rising costs from global tariff developments [3][4]. Dividend Announcement - On May 6, 2025, the board of directors approved a quarterly dividend of $0.45 per share, payable on or about May 23, 2025 [13].

Company Overview - Karat Packaging Inc. is a specialty distributor and manufacturer of disposable foodservice products and related items, primarily serving national and regional restaurants and foodservice settings across the United States [2] - The product range includes food and take-out containers, bags, tableware, cups, lids, cutlery, straws, specialty beverage ingredients, equipment, gloves, and other items [2] - The company offers an eco-friendly product line called Karat Earth®, which focuses on quality and sustainability using renewable resources [2] - Customized solutions are also provided, including new product development, design, printing, and logistics services [2] Recent Financial Announcement - The board of directors of Karat Packaging Inc. approved a regular quarterly dividend of $0.45 per share on the company's common stock [1] - This dividend is scheduled to be payable on or about May 23, 2025, to stockholders of record as of May 16, 2025 [1]

Core Viewpoint - Karat Packaging Inc. is set to release its first quarter financial results for 2025 on May 8, 2025, and will host an investor conference call on the same day [1]. Company Overview - Karat Packaging Inc. is a specialty distributor and manufacturer of environmentally friendly disposable foodservice products, primarily serving national and regional restaurants in the United States [3]. - The product range includes food and take-out containers, bags, tableware, cups, lids, cutlery, straws, specialty beverage ingredients, equipment, gloves, and more [3]. - The company offers an eco-friendly product line called Karat Earth®, which focuses on sustainability and is made from renewable resources [3]. - Customized solutions are also provided, including new product development, design, printing, and logistics services [3]. Investor Relations - The investor conference call is scheduled for May 8, 2025, at 2:00 p.m. PT/5:00 p.m. ET, with specific phone numbers provided for domestic and international participants [2]. - The conference can be accessed via a webcast, which will be archived for approximately one year [2].

Core Viewpoint - Karat Packaging, Inc. reported lower-than-expected fourth-quarter 2024 earnings, leading to a 5% decline in share price, despite a year-over-year earnings improvement of 21% [1][9]. Financial Performance - The adjusted EPS for Q4 2024 was 29 cents, missing the Zacks Consensus Estimate of 37 cents by 21.6% [1]. - Total revenues for the quarter were $101.6 million, slightly below the Zacks Consensus Estimate of $102.3 million, with a year-over-year revenue increase of 6% [3][4]. - The year-ago quarter benefited from a $4.8 million adjustment of online sales platform fees [3]. - Gross profit rose 17% year over year to $39.8 million, with a gross margin of 39.2%, reflecting a 350-basis point expansion from the previous year [6]. - Operating expenses increased by 10% year over year to $32.5 million, while adjusted EBITDA rose 32% to $11.3 million, resulting in an adjusted EBITDA margin of 11.1% [7]. Cash Flow and Position - As of December 31, 2024, cash and cash equivalents were reported at $21.6 million, down from $23.1 million a year earlier, with cash flow from operations at $48 million compared to $53 million in the prior year [8]. Guidance and Projections - For Q1 2025, the company anticipates year-over-year sales growth of 6-8%, with a projected gross margin between 37% and 39% [12]. - For the full year 2025, sales growth is expected to be in the range of 9-11%, with targeted gross margins between 36% and 48% [12]. Market Performance - Over the past year, Karat Packaging's shares have gained 3.3%, outperforming the industry growth of 2.6% [13].

FORM 10-K (Mark One) UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Washington, D.C. 20549 ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For transition period from to Commission File Number 001-40336 For the fiscal year ended December 31, 2024 Karat Packaging Inc. (Address of registrant's principal executive offices) (Zip code) (626) 965-8882 (Registrant's telephone number ...

Financial Data and Key Metrics Changes - The company reported net sales of $101.6 million for Q4 2024, a 6.3% increase from $95.6 million in the prior year quarter [16] - Gross profit increased 16.8% to $39.8 million, with gross margin expanding by 350 basis points to 39.2% [20] - Net income for Q4 2024 rose 40.3% to $5.9 million, with a net income margin of 5.8% compared to 4.4% in the prior year [22] - Adjusted EBITDA increased to $11.3 million for Q4 2024 from $8.6 million in the prior year quarter, with an adjusted EBITDA margin of 11.1% [23] Business Line Data and Key Metrics Changes - Sales to the distributor channel increased by 13.8%, while sales to national and regional chains rose by 1.7%. Retail channel sales decreased by 1.4% [18] - Eco-Friendly product sales grew 11% year over year, representing 34.5% of total sales [10] Market Data and Key Metrics Changes - The strongest growth was observed in the Midwest, with California stabilizing and showing modest growth in December [8][9] - The company reduced reliance on China for imports to approximately 20%, with over 50% of global purchases coming from Taiwan in 2024 [7] Company Strategy and Development Direction - The strategic focus for 2025 includes driving sales growth and improving operational efficiencies, with plans to expand into the supermarket sector [11][13] - A new 187,000 square foot distribution center is set to be operational by May 2025, nearly doubling distribution capacity in California [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued positive momentum into 2025, with robust sales growth observed in January and February [11] - The company anticipates minimal long-term impact from recently imposed tariffs due to a strong U.S. dollar and stable ocean freight rates [8] Other Important Information - The Board of Directors approved an increase in the quarterly cash dividend payment to $0.45 per share [14] - The company expects net sales for Q1 2025 to increase by 6% to 8% over the prior year quarter, with a full-year revenue growth expectation of 9% to 11% [25][26] Q&A Session Summary Question: What is the expectation for revenue growth acceleration in Q1 2025? - Management noted that California's market has stabilized and is growing modestly, with significant growth in Texas and the Midwest [29] Question: How will adjusted EBITDA margins differ between Q1 and the full year? - Management indicated that operational savings from shipping and reduced lease rates will contribute positively to margins [36] Question: What are the drivers of revenue growth in 2025? - Volume growth is expected to be in the double digits, while pricing will see some increases due to tariffs [41] Question: How will the company handle freight costs in 2025? - Management expects freight costs to decrease, benefiting margins, with operational expenses anticipated to come down in Q2 [52][54] Question: What is the outlook for cash flow and capital spending in 2025? - The company plans to invest around $5 million in capital expenditures, primarily for new trucks, while maintaining a strong free cash flow conversion ratio [74][75]

Karat Packaging, Inc. (NASDAQ:KRT) Q4 2024 Earnings Conference Call March 13, 2025 5:00 PM ET Company Participants Roger Pondel - PondelWilkinson Inc., Investor Relations Alan Yu - Chairman and Chief Executive Officer Jian Guo - Chief Financial Officer Conference Call Participants Ryan Meyers - Lake Street Capital Markets Jake Bartlett - Truist Securities Brian Butler - Stifel Michael Francis - William Blair Roger Pondell Good afternoon, everyone. Welcome to Karat Packaging's 2024 fourth quarter conference ...

Karat Packing (KRT) came out with quarterly earnings of $0.29 per share, missing the Zacks Consensus Estimate of $0.37 per share. This compares to earnings of $0.24 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -21.62%. A quarter ago, it was expected that this company would post earnings of $0.52 per share when it actually produced earnings of $0.47, delivering a surprise of -9.62%.Over the last four quarters, the company ha ...

Karat Packaging Reports Fourth Quarter and Full Year 2024 Financial Results — Robust Growth, Including Record Full Year Gross Margin, as Business Continues to Expand — CHINO, Calif, March 13, 2025 – Karat Packaging Inc. (Nasdaq: KRT) ("Karat" or the "Company"), a specialty distributor and manufacturer of environmentally friendly, disposable foodservice products and related items, today announced financial results for its fourth quarter and full year ended December 31, 2024. Fourth Quarter 2024 Highlights Gu ...