Alpha Pro Tech, Ltd. Announces Second Quarter 2024 Financial Results

Core Insights - Alpha Pro Tech, Ltd. reported a net sales increase of 1.1% to $16.3 million for Q2 2024 compared to Q2 2023, driven by growth in the Disposable Protective Apparel segment, while the Building Supply segment experienced a decline [1][6][9]. Financial Performance - Net income for Q2 2024 was $1.6 million, a 43.5% increase from $1.1 million in Q2 2023, with earnings per diluted share rising from $0.10 to $0.15 [1][18]. - For the six months ended June 30, 2024, net income was $2.2 million, up 30.7% from $1.7 million in the same period of 2023 [19]. Segment Performance - Building Supply segment sales decreased by 5.7% to $9.9 million in Q2 2024, attributed to a 7.4% decline in housing starts and a 9.0% drop in housewrap sales [2][7]. - Disposable Protective Apparel segment sales increased by 13.8% to $6.3 million in Q2 2024, with notable growth in face masks (81.0%) and face shields (64.1%) [8][11]. Gross Profit and Margins - Gross profit for Q2 2024 increased by 12.0% to $6.8 million, with a gross profit margin of 42.0%, up from 37.9% in Q2 2023 [12][13]. - For the six months ended June 30, 2024, gross profit rose by 10.6% to $12.3 million, with a margin of 41.2% compared to 37.1% in the prior year [13]. Expenses - Selling, general and administrative expenses increased by 6.8% to $4.9 million in Q2 2024, representing 30.0% of net sales, up from 28.4% in Q2 2023 [14]. - For the six months ended June 30, 2024, these expenses rose by 9.5% to $9.7 million, accounting for 32.7% of net sales [14]. Balance Sheet - As of June 30, 2024, the company had cash and cash equivalents of $16.2 million and working capital of $50.7 million, with no outstanding debt [20][21]. - Inventory increased by 3.2% to $20.8 million, driven by a 26.9% rise in the Building Supply segment inventory [20]. Market Outlook - The company anticipates continued challenges in the Building Supply segment due to projected declines in single-family and multi-family housing starts for the remainder of 2024 [4]. - Management expects growth in the Disposable Protective Apparel segment to continue, supported by increased sales to major customers [4][5].