solo stove(DTC) - 2024 Q4 - Annual Results

Financial Performance - Net sales for Q4 2024 decreased by $21.8 million to$ 143.5 million, down 13.2%, primarily due to declines in both retail and direct-to-consumer channels within the Solo Stove segment[6]. - Gross profit for Q4 2024 was $87.8 million, or 61.1% of net sales, an increase of 280 basis points compared to the previous year[6]. - The net loss for Q4 2024 was$ 58.2 million, or (40.6)% of net sales, which improved compared to the prior year[6]. - For the full year 2024, net sales decreased by $40.2 million to$ 454.6 million, down 8.1%, driven by declines in both retail and DTC channels within the Solo Stove segment[6]. - Adjusted EBITDA for the full year 2024 was $32.6 million, or 7.2% of net sales, which declined from the prior year[6]. - Net loss attributable to Solo Brands, Inc. for the year ended December 31, 2024, was$ 113.4 million, compared to a loss of $111.3 million in 2023[19]. - Year-end 2024 net loss was$ 180,192 thousand, compared to a net loss of $195,332 thousand for the year 2023[51]. - The adjusted EBITDA margin for the year 2024 was 7.2%, down from 14.2% in 2023[51]. Operating Expenses - Operating expenses decreased by$ 194.2 million to $143.0 million, down 57.6%, mainly due to a reduction in restructuring and impairment charges[6]. - Total operating expenses in Q4 2024 were$ 143.0 million, significantly reduced from $337.2 million in Q4 2023[19]. - Restructuring and related charges for Q4 2024 amounted to$ 52,048 thousand, compared to $244,650 thousand in Q4 2023[51]. - The company incurred restructuring, contract termination, impairment, and related charges of$ 154,408,000 for the year ended December 31, 2024[49]. Cash and Liquidity - Cash and cash equivalents were $12.0 million as of December 31, 2024, compared to$ 19.8 million at the end of 2023[7]. - The company reported a net cash provided by operating activities of $10.5 million for the year ended December 31, 2024, down from$ 62.4 million in 2023[28]. - The company is evaluating strategies to refinance existing debt and improve liquidity through operational improvements in 2025[9]. Inventory and Assets - Inventory as of December 31, 2024, was $108.6 million, a slight decrease from$ 111.6 million at the end of 2023[8]. - Total assets decreased to $495.1 million in 2024, down from$ 659.3 million in 2023[26]. - Long-term debt remained relatively stable at $142.1 million in 2024 compared to$ 143.0 million in 2023[26]. Marketing and Business Initiatives - Marketing expenses for Solo Stove in 2024 were $67.7 million, a decrease from$ 71.8 million in 2023[24]. - The company has identified 30+ value accretive initiatives as part of its turnaround plan for 2025[3]. - The company reported a significant increase in business optimization and expansion expenses, totaling $8,108,000 for the year ended December 31, 2024[48]. - Business optimization and expansion expenses for Q4 2024 were$ 1,852 thousand, compared to $6 thousand in Q4 2023[51]. Profit Margins and Adjustments - For the year ended December 31, 2024, the adjusted gross profit was$ 280,305,000, with an adjusted gross profit margin of 61.7%[47]. - The company reported a gross profit of $260,264,000 for the year ended December 31, 2024, with a gross profit margin of 57.3%[47]. - The adjusted net income (loss) per Class A common stock for the year ended December 31, 2024, was$ 0.12, compared to $(1.94) for the net income (loss) per Class A common stock[49]. - The company plans to present adjusted net income (loss) per Class A common stock excluding noncontrolling interests going forward, enhancing comparability[37].