Colabor Group Reports Results for the Second Quarter 2025

Core Insights - Colabor Group Inc. reported a net loss of $2.3 million for Q2 2025, a significant decline from net earnings of $1.7 million in Q2 2024, primarily due to decreased adjusted EBITDA and increased operational costs [4][12][14] - The company experienced a 5.1% increase in sales, reaching $169.5 million compared to $161.3 million in the same quarter of the previous year, driven by the acquisition of Alimplus Inc. and organic growth from major accounts [7][10] - Adjusted EBITDA fell to $5.4 million, representing a margin of 3.2%, down from $9.7 million and 6.0% in Q2 2024, attributed to lower gross margins from a renewed supply agreement [11][14] Financial Performance - Sales from continuing operations for the 12-week period were $169.5 million, up from $161.3 million in 2024, while for the 24-week period, sales were $301.2 million compared to $292.5 million in 2024 [4][13] - Adjusted EBITDA for the 12-week period was $5.4 million (3.2% margin) compared to $9.7 million (6.0% margin) in 2024, and for the 24-week period, it was $7.6 million (2.5% margin) compared to $14.6 million (5.0% margin) in 2024 [11][14] - Cash flow from operating activities decreased to $4.5 million for the 12-week period and $10.7 million for the 24-week period, down from $5.0 million and $16.7 million in 2024, respectively [15] Debt and Financial Position - As of June 14, 2025, net debt increased to $97.3 million from $47.8 million at the end of 2024, primarily due to the acquisition financing [16] - The financial leverage ratio rose to 4.3x, up from 2.4x at the end of 2024, indicating increased reliance on debt [4][6] Recent Developments - A cybersecurity incident was identified on July 20, 2025, impacting the company's internal IT systems [3] - The acquisition of Alimplus Inc. is expected to enhance growth and market position, with a six-year distribution agreement signed to serve Groupe Mayrand Alimentation inc. [8][9] - The company aims to improve profitability and prioritize debt reduction in the second half of 2025 [18]