Cadre (US:CDRE)2025-05-06 20:17Financial Performance - Net sales for Q1 2025 were $130.1 million, a decrease of 5.1% compared to $137.9 million in Q1 2024[20] - Gross profit for Q1 2025 was $56.1 million, resulting in a gross margin of 43.2%, slightly down from 41.7% in Q1 2024[20] - Operating income increased to $13.6 million in Q1 2025, up 13.2% from $12.0 million in Q1 2024[20] - Net income for Q1 2025 was $9.2 million, representing a 33.5% increase from $6.9 million in Q1 2024[20] - Basic net income per share rose to $0.23 in Q1 2025, compared to $0.18 in Q1 2024, reflecting a 27.8% increase[20] - The company reported a comprehensive income of $9.1 million for Q1 2025, compared to $7.3 million in Q1 2024[20] - Adjusted EBITDA for the three months ended March 31, 2025, was $20.5 million, down from $24.5 million in the same period of 2024, representing a decrease of 16.3%[144] - Net income increased by $2.3 million, or 33.5%, to $9.2 million for the three months ended March 31, 2025, primarily due to the non-recurrence of acquisition-related costs incurred in 2024[122][130] Assets and Liabilities - Total current assets increased to $332.5 million as of March 31, 2025, up from $327.6 million at the end of 2024[17] - Total liabilities decreased to $338.7 million as of March 31, 2025, down from $341.2 million at the end of 2024[17] - Cash and cash equivalents at the end of Q1 2025 were $133.4 million, an increase from $124.9 million at the end of 2024[23] - As of March 31, 2025, total shareholders' equity increased to $317,562, up from $311,515 on December 31, 2024, reflecting a growth of approximately 1.7%[24] - Outstanding debt as of March 31, 2025, was $220.5 million, a slight decrease from $223.2 million as of December 31, 2024[149] - As of March 31, 2025, total long-term debt, net of unamortized debt discount and issuance costs, was $209,134,000, a slight decrease from $211,830,000 as of December 31, 2024[73] Cash Flow - Net cash provided by operating activities was $17.4 million in Q1 2025, significantly higher than $2.1 million in Q1 2024[23] - Net cash used in investing activities was $1.3 million for the three months ended March 31, 2025, significantly lower than $142.6 million in the same period of 2024, which included acquisitions[171] - The company paid dividends of $3.9 million during the three months ended March 31, 2025[172] Acquisitions and Investments - The company completed the acquisition of ICOR Technology Inc. for a total consideration of $41,508,000, which includes $2,226,000 in contingent consideration[51] - The acquisition of Alpha Safety Intermediate, LLC was completed for a total consideration of $102,531,000, with goodwill recognized at $49,133,000[57] - The Company acquired Carr's Engineering Limited and Carr's Engineering (US), Inc. for approximately $99,750 in April 2025[112] - The Company drew $97,500 of the $115,000 available under the DDTL- A-1 Facility in connection with the acquisition of the Nuclear Engineering Division[114] Segment Performance - Net sales for the Product segment were $112,735 and for the Distribution segment were $27,862 for the three months ended March 31, 2025, totaling $130,106[111] - The Product segment net sales decreased by $6.1 million, or 5.1%, to $112.7 million for the three months ended March 31, 2025, primarily due to decreases in explosive ordnance disposal and armor products[132] - The Distribution segment net sales decreased by $0.3 million, or 1.2%, to $27.9 million for the three months ended March 31, 2025, primarily due to decreased demand for hard goods[132] Expenses and Costs - Cost of goods sold for the Product segment decreased by $5.2 million, or 7.6%, to $62.6 million for the three months ended March 31, 2025[133] - Selling, general and administrative expenses increased by $1.0 million, or 2.5%, for the three months ended March 31, 2025, primarily due to recent acquisitions[134] - Interest expense increased by $0.6 million, or 36.3%, to $2.2 million for the three months ended March 31, 2025, primarily due to debt refinancing[136] Tax and Compliance - The effective tax rate for the three months ended March 31, 2025, was 26.6%, higher than the statutory rate due to state taxes and non-deductible executive compensation[99] - The effective tax rate for the three months ended March 31, 2025, was 26.6%, compared to 22.1% for the same period in 2024[137] - The company follows U.S. GAAP for financial reporting, ensuring compliance with SEC regulations and maintaining transparency in financial statements[26] Market and Risk Factors - A 10% increase or decrease in the value of the Canadian dollar would have caused reported net sales to increase or decrease by approximately $0.9 million for the three months ended March 31, 2025[190] - A 10% increase or decrease in the value of the Mexican peso would have caused reported net income to increase or decrease by approximately $0.5 million for the same period[190] - There have been no material changes in market risk exposures as of March 31, 2025[182] Internal Controls and Governance - The company's disclosure controls and procedures were deemed effective as of March 31, 2025[191] - No changes in internal control over financial reporting occurred during the three months ended March 31, 2025[192]