Xcel(US:XELB)2025-06-04 22:02Financial Data and Key Metrics Changes - Total revenues for Q4 2024 were $1.2 million and $8.3 million for the full fiscal year, roughly half of the prior year due to the sale of the Lori Goldstein brand and exit from wholesale operations [14] - Total revenues for Q1 2025 were $1.3 million, a slight increase from Q4 2024 [14] - Adjusted EBITDA loss for Q4 2024 was $792,000, an improvement of $361,000 from Q4 2023 [13] - The company reported a net loss of approximately $2.8 million for Q1 2025, a 56% improvement on a GAAP basis compared to the prior year [19] Business Line Data and Key Metrics Changes - The company has reduced direct operating costs and expenses by nearly 50% year over year from FY 2023 to FY 2024 [15] - Direct operating expenses for Q1 2025 were approximately $2.3 million, about 40% lower than the prior year [16] - The Longeberger brand is set to launch on QVC in the fall, and the Ormy team has onboarded 25 premium beauty brands [12] Market Data and Key Metrics Changes - Social media reach across the brand portfolio grew from 5 million followers in January 2025 to 45 million [10] - The company aims to build a portfolio of creator influencer brands that reaches 100 million followers [12] Company Strategy and Development Direction - The strategic transaction with United Trademark Group aims to enhance global distribution and product quality [9] - The company is focusing on creator influencer brands, with new launches expected to drive growth [10] - Management is cautious about Q3 and Q4 due to potential impacts from tariffs and operational consolidations [11] Management's Comments on Operating Environment and Future Outlook - Management is assessing the impact of tariffs and the HSN Tampa studio closure on business operations [13] - The company forecasts adjusted EBITDA for 2025 to be between $1 million and $2.5 million, factoring in potential disruptions [23] - Management believes that influencer brands are the new currency in media, particularly with credible voices in their categories [31] Other Important Information - The company has a balance sheet reflecting stockholders' equity of approximately $26 million and unrestricted cash of about $300,000 as of March 31, 2025 [20] - The company refinanced its term debt, resulting in a net increase of approximately $3 million in liquidity [20] Q&A Session Summary Question: Clarification on adjusted EBITDA for 2025 - Management confirmed that the adjusted EBITDA forecast includes potential impacts from tariffs and operational disruptions [23] Question: Run rate of operating costs - The run rate for overhead costs is approximately $9 million annually, translating to less than $2.5 million per quarter [24][25] Question: Liquidity needs for upcoming brand launches - Management stated that current liquidity is sufficient, but they will address any additional capital needs as they arise [28] Question: Revenue potential of recently launched brands - Management indicated that brands like Cesar Millan have the potential to generate between $5 million and $10 million in royalty income per year [47] Question: Operating expenses as the business pivots to growth - Management noted that the structure is designed to scale, with incremental costs primarily tied to revenue growth [49][50] Question: Revenue expectations for Q2 - Management expressed confidence in Q2 performance but will report any significant impacts as they arise [52]