Steel Partners(SPLP) - 2023 Q4 - Annual Results

Revenue Performance - Revenue for Q4 2023 was $466.9 million, a 10.5% increase from $422.6 million in Q4 2022[5] - Full year 2023 revenue reached $1.9 billion, up 12.4% from $1.7 billion in 2022[8] - Total revenue for the year ended December 31, 2023, was $1.905 billion, a 12.4% increase from $1.695 billion in 2022[39] - Financial Services revenue rose significantly to $416.9 million in 2023, compared to $228.0 million in 2022, marking an 83% increase[36] - Revenue from the Diversified Industrial segment for Q4 2023 was $275.394 million, down 8% from $299.553 million in Q4 2022[42] - Financial Services segment revenue increased to $112.341 million in Q4 2023, up 43.9% from $78.001 million in Q4 2022[42] Net Income - Net income for Q4 2023 was $42.7 million, down from $73.1 million in Q4 2022[25] - Full year net income for 2023 was $154.0 million, compared to $206.2 million in 2022[26] - Net income attributable to common unitholders for the year was $150.8 million, down from $206.2 million in 2022[36] - The company reported a net income per common unit of $7.04 for 2023, compared to $9.03 in 2022[36] - Net income from continuing operations for Q4 2023 was $42.697 million, a decrease of 41.5% compared to $73.083 million in Q4 2022[39] Cash Flow and Liquidity - Adjusted free cash flow for Q4 2023 totaled $87.6 million, significantly higher than $30.3 million in Q4 2022[28] - Cash and cash equivalents at the end of the period increased to $577.9 million from $234.4 million at the end of 2022[38] - As of December 31, 2023, the company had $399.3 million in available liquidity and $407.6 million in cash and cash equivalents, excluding WebBank cash[30] - The company reported a net cash position of $56.376 million as of December 31, 2023, compared to a net debt of $47.631 million in 2022[40] Expenses and Capital Expenditures - Adjusted EBITDA for Q4 2023 was $59.4 million, with an adjusted EBITDA margin of 12.7%[28] - Full year adjusted EBITDA was $240.6 million, with an adjusted EBITDA margin of 12.6%[29] - Selling, general and administrative expenses increased by 25.2% in Q4 2023 compared to Q4 2022, totaling $128.7 million[11] - Capital expenditures for Q4 2023 were $14.8 million, representing 3.2% of revenue[27] Debt and Liabilities - Total debt as of December 31, 2023, was $191.4 million, with net cash of $56.4 million[5] - Total debt increased to $191.4 million as of December 31, 2023, up by $11.0 million compared to the previous year[31] - The company’s total liabilities increased to $2.985 billion, up from $2.434 billion in the previous year[35] Risks and Uncertainties - The company anticipates significant risks and uncertainties that could affect its future results, including economic downturns and supply chain disruptions[51] - The ongoing Russia-Ukraine war and the conflict between Israel and Hamas have contributed to volatility in crude oil and commodity prices[51] - Rising interest rates may impact the company's financial performance and cash flow requirements[51] - The company is subject to extensive legal and regulatory requirements, including environmental and banking regulations[51] - There are risks associated with the company's wholly-owned subsidiary, WebBank, due to its FDIC status and highly-regulated lending programs[51] - Changes in U.S. trade policies and tax regulations could negatively impact the company's operations[51] - The company must maintain effective internal control over financial reporting to mitigate risks[51] - The company has outlined various risk factors in its SEC filings that could affect its results, including potential loss of significant customer contracts[51] Strategic Focus - The company plans to continue focusing on market expansion and new product development to drive future growth[43] - Adjusted EBITDA is defined as net income before interest, taxes, depreciation, and amortization, providing a clearer view of operational performance[44]