Olaplex (US:OLPX)2022-08-08 16:00Financial Performance - Net sales for the three months ended June 30, 2022, were $210.9 million, a 38.6% increase from $152.1 million in the same period of 2021[22] - Gross profit for the six months ended June 30, 2022, was $297.6 million, compared to $214.1 million for the same period in 2021, reflecting a 38.9% increase[22] - Operating income for the three months ended June 30, 2022, was $120.0 million, up 57.0% from $76.6 million in the prior year[22] - Net income for the six months ended June 30, 2022, was $149.7 million, compared to $94.9 million for the same period in 2021, representing a 57.7% increase[22] - The company reported a basic net income per share of $0.14 for the three months ended June 30, 2022, compared to $0.08 for the same period in 2021[22] - The Company reported a net income of $87.7 million for the three months ended June 30, 2022, compared to $49.4 million for the same period in 2021, representing a 77.5% increase[71] - For the six months ended June 30, 2022, net income was $149.7 million, up from $94.9 million in the same period of 2021, reflecting a 57.7% increase[71] - The basic net income per share for the three months ended June 30, 2022, was $0.14, compared to $0.08 for the same period in 2021, a 75% increase[71] Cash and Assets - Cash and cash equivalents increased to $198.0 million as of June 30, 2022, from $186.4 million at the end of 2021[18] - Total current assets rose to $425.5 million as of June 30, 2022, compared to $335.2 million at the end of 2021, marking a 27.0% increase[18] - Cash and cash equivalents at the end of the period were $198,028,000, up from $76,430,000 at the end of the same period in 2021, indicating a significant increase in liquidity[27] - Net cash provided by operating activities for the six months ended June 30, 2022, was $128,053,000, compared to $74,953,000 for the same period in 2021, reflecting a 71% increase[27] - Total equity increased from $524,298,000 on December 31, 2021, to $679,197,000 on June 30, 2022, marking a growth of approximately 30%[27] Liabilities and Debt - Total liabilities decreased to $952.5 million as of June 30, 2022, from $1,036.1 million at the end of 2021[18] - Long-term debt as of June 30, 2022, was $656.99 million, down from $738.09 million as of December 31, 2021[61] - The Company had $673 million of outstanding variable rate loans under the 2022 Term Loan Facility as of June 30, 2022, with a potential interest cost fluctuation of approximately $6.7 million for a 1% change in interest rates[133] - Interest expense for the six months ended June 30, 2022, was $20.15 million, compared to $31.07 million for the same period in 2021[63] - As of June 30, 2022, the carrying amount of the Company's long-term debt was $663.7 million, with a fair value of $634.6 million[65] Inventory and Expenses - The company’s inventory increased to $140.3 million as of June 30, 2022, from $98.4 million at the end of 2021, reflecting a 42.5% increase[18] - The Company reported an inventory write-off and disposal of $4,324,000 for the six months ended June 30, 2022[27] - Share-based compensation expense for the six months ended June 30, 2022, was $3,423,000, compared to $1,174,000 for the same period in 2021, indicating a significant increase in compensation costs[27] Sales Channels - Professional channel sales reached $105.5 million for the three months ended June 30, 2022, up 32.7% from $79.5 million in the prior year[48] - Direct-to-consumer (DTC) sales increased to $41.2 million for the three months ended June 30, 2022, representing a 19.3% growth compared to $34.5 million in 2021[48] - U.K. net sales represented 8% of total net sales for the three months ended June 30, 2022, down from 11% in the same period of 2021[48] Corporate Developments - The company completed a series of Reorganization Transactions prior to the IPO, resulting in the exchange of all outstanding units of Penelope Group Holdings for 648,124,642 shares of common stock of Olaplex Holdings[32] - The company has entered into a Tax Receivable Agreement, requiring it to pay 85% of cash savings from tax attributes to former limited partners of Penelope Group Holdings[42] - Olaplex Holdings was incorporated on June 8, 2021, to facilitate an initial public offering and related transactions, operating through its subsidiaries, including Olaplex, Inc.[28] Accounting Standards - The Company adopted ASU 2020-04 on January 1, 2022, which did not have a material impact on its Consolidated Financial Statements[45] - The Company is evaluating the impact of ASU 2016-13, effective for fiscal years beginning after December 15, 2022, on its financial statements[46] Market Risks - The Company is exposed to market risks including interest rate fluctuations, which may impact future earnings and cash flows[132]