Cadre (US:CDRE)2023-11-07 16:00Financial Performance - For the three months ended September 30, 2023, net sales reached $125.1 million, a 12.2% increase from $111.6 million in the same period of 2022 [193]. - Gross profit for the three months ended September 30, 2023, was $53.6 million, representing a 22.5% increase from $43.7 million in the prior year [193]. - Operating income for the three months ended September 30, 2023, increased by 62.2% to $16.7 million compared to $10.3 million in the same period of 2022 [193]. - Net income for the three months ended September 30, 2023, was $11.1 million, a 123.7% increase from $4.9 million in the same period of 2022 [193]. - EBITDA for the three months ended September 30, 2023, was $20.584 million, compared to $12.406 million for the same period in 2022, representing an increase of 66.1% [233]. - Adjusted EBITDA for the nine months ended September 30, 2023, was $65.128 million, compared to $53.346 million for the same period in 2022, reflecting an increase of 22.1% [233]. - Gross profit for the nine months ended September 30, 2023, was $150.968 million, compared to $127.150 million for the same period in 2022, reflecting an increase of $23.818 million [221]. Sales and Revenue - As of September 30, 2023, the orders backlog increased by $8.3 million to $126.2 million compared to $117.9 million on December 31, 2022, driven by increases in explosive ordinance disposal products and duty gear [188][190]. - Product segment net sales increased by $27.2 million, or 9.8%, to $305.1 million for the nine months ended September 30, 2023, compared to $277.9 million in the prior year [201]. - Distribution segment net sales increased by $0.8 million, or 1.0%, to $74.6 million for the nine months ended September 30, 2023, compared to $73.8 million in the prior year [201]. - Net sales for the product segment increased by $15.8 million, or 17.0%, from $92.7 million to $108.5 million for the three months ended September 30, 2023, driven by higher domestic demand for armor products and large international orders for crowd control products [222]. Expenses and Costs - Selling, general and administrative expenses increased by $4.6 million, or 14.4%, for the three months ended September 30, 2023, primarily due to employee compensation and related benefits [223]. - Interest expense decreased by $0.8 million, or 17.1%, for the nine months ended September 30, 2023, primarily due to a decrease in outstanding borrowings [204]. - Interest expense decreased by $0.5 million, or 31.5%, for the three months ended September 30, 2023, compared to the same period in 2022 [247]. - Restructuring and transaction costs decreased by $1.1 million for the three months ended September 30, 2023, compared to the same period in 2022, primarily due to costs associated with acquisitions in 2022 [197]. - Product segment cost of goods sold increased by $5.0 million, or 3.0%, from $166.2 million to $171.2 million for the nine months ended September 30, 2023, due to increased volume and manufacturing costs [248]. Cash Flow and Debt - Net cash provided from operating activities totaled $46.3 million for the nine months ended September 30, 2023, compared to $29.5 million for the same period in 2022 [245]. - As of September 30, 2023, cash and cash equivalents totaled $69.4 million, up from $36.35 million at the end of the same period in 2022 [245]. - As of September 30, 2023, the company had $143.6 million in outstanding debt, net of discounts and issuance costs [261]. - The company refinanced its credit facilities, borrowing $200.0 million under a term loan and having access to a $100.0 million revolving credit facility, both maturing on July 23, 2026 [239]. Tax and Other Income - The effective tax rate for the three months ended September 30, 2023, was 28.0%, slightly lower than 28.4% in the same period of 2022 [200]. - The effective tax rate was 28.3% for the nine months ended September 30, 2023, compared to 76.5% for the same period in 2022 [252]. - Other income, net was $0.4 million for the three months ended September 30, 2023, compared to a net expense of $2.8 million for the same period in 2022 [251]. Risk and Compliance - The management does not expect that disclosure controls can prevent all errors and fraud, indicating inherent limitations in control systems [305]. - There have been no material changes in risk factors from those disclosed in the previous Annual Report for the year ended December 31, 2022 [307]. - The certifications attached to the Quarterly Report are deemed furnished and not filed with the Securities and Exchange Commission [308]. - The company acknowledges foreign currency exchange rate risk as a factor in its financial reporting [313].