Fox(US:FOXF)2024-02-21 16:00Financial Performance - Fourth quarter 2023 net sales were $332 million, a decrease of 18.6% from $408.6 million in Q4 2022, driven by a 41.4% decrease in Specialty Sports Group (SSG) sales[5] - The company achieved a net income of $4 million, with earnings per diluted share of $0.10, compared to $53 million and $1.25 in Q4 2022[9] - Adjusted EBITDA for Q4 2023 was $38.8 million, resulting in an adjusted EBITDA margin of 11.7%, down from 18.8% in Q4 2022[10] - For the fiscal year 2023, net sales totaled $1.464 billion, an 8.6% decrease compared to fiscal 2022, with SSG sales down 42.8%[11] - Gross profit for the twelve months ended December 29, 2023, was $464,812 thousand, down 12.5% from $531,343 thousand in the previous year[28] - Adjusted net income for the twelve months ended December 29, 2023, was $120,846 thousand, a decline of 41.0% compared to $205,278 thousand for the same period in 2022[30] - For the three months ended December 29, 2023, net income was $4,051 thousand, a decrease of 92.3% compared to $52,959 thousand for the same period in 2022[33] - Adjusted net income for the twelve months ended December 29, 2023, was $167,473 thousand, down 28.0% from $232,670 thousand in the previous year[33] - Adjusted EBITDA for the twelve months ended December 29, 2023, was $261,048 thousand, a decrease of 18.9% compared to $321,831 thousand for the previous year[37] Expenses and Margins - The company reported a gross margin of 31.7% for fiscal 2023, a decrease of 150 basis points from 33.2% in fiscal 2022[11] - Total operating expenses for fiscal 2023 were $304.7 million, or 20.8% of net sales, compared to $284.6 million, or 17.8% in fiscal 2022[12] - Operating expense for the three months ended December 29, 2023, was $81,009 thousand, an increase of 9.9% from $74,167 thousand in the same period of 2022[44] - The company reported a net income margin of 1.2% for the three months ended December 29, 2023, down from 13.0% in the same period of 2022[37] - Adjusted gross margin for the twelve months ended December 29, 2023, was 32.8%, compared to 33.4% for the previous year[41] - Adjusted operating margin for the three months ended December 29, 2023, was 20.6%, compared to 16.2% for the same period in 2022[44] Acquisitions and Growth - The company completed the acquisition of Marucci, contributing $17 million in revenue for Q4 2023, and also acquired Custom Wheel House earlier in the year[4] - The company is focused on the acquisition of Marucci and expects future performance improvements from this acquisition[45] - The company aims for $2 billion in sales by 2025, contingent on various market factors including OEM demand and macroeconomic conditions[18] - The company is exploring opportunities for international growth and market expansion[45] - The company is focused on increasing its aftermarket penetration to enhance revenue streams[45] Cash and Assets - The company had cash and cash equivalents of $83.6 million as of December 29, 2023, down from $145.3 million a year earlier, primarily due to debt payments and share repurchases[16] - Total assets increased to $2,242,298 thousand as of December 29, 2023, from $1,618,336 thousand as of December 30, 2022, representing a growth of 38.5%[26] - Cash and cash equivalents decreased to $83,642 thousand as of December 29, 2023, from $145,250 thousand as of December 30, 2022, a decline of 42.4%[26] - Total liabilities rose to $1,020,537 thousand as of December 29, 2023, compared to $496,950 thousand as of December 30, 2022, an increase of 105.5%[26] Future Outlook and Challenges - Fiscal 2024 guidance projects net sales between $1.53 billion and $1.68 billion, with adjusted earnings per diluted share expected to range from $2.30 to $2.60[17] - The company anticipates demand for its products to remain strong despite potential supply chain disruptions[45] - The company aims to improve operating efficiencies and maintain profitability in the upcoming quarters[45] - The company is committed to developing new and innovative products to expand into new categories and end-markets[45] - The company is facing risks related to inflation and interest rate increases by the U.S. Federal Reserve[45] - The company acknowledges potential challenges from geopolitical tensions affecting its supply chain[45] - The company is aware of the impact of consumer preferences on its product demand and is prepared to adapt accordingly[45] - The company incurred interest expenses of $19,320 thousand for the twelve months ended December 29, 2023, compared to $8,939 thousand in the previous year, reflecting a significant increase[28] - Research and development expenses for the twelve months ended December 29, 2023, were $53,179 thousand, a decrease of 5.4% from $56,205 thousand in the previous year[28] - The weighted-average shares used to compute diluted earnings per share for the twelve months ended December 29, 2023, were 42,432 thousand, slightly up from 42,384 thousand in the previous year[28]