TrueBlue, Inc. (NYSE:TBI) Q4 2024 Earnings Conference Call February 19, 2025 5:00 PM ET Company Participants Taryn Owen - CEO, President & Director Carl Schweihs - EVP & CFO Conference Call Participants Will Brunemann - Northcoast Research Mark Marcon - Baird Marc Riddick - Sidoti Operator Greetings, and welcome to the TrueBlue Fourth Quarter 2024 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. At this time, I would like to remind everyone that today's call and slide ...

OPENLANE, Inc. (NYSE:KAR) Q4 2024 Earnings Conference Call February 19, 2025 5:00 PM ET Company Participants Itunu Orelaru - Head-Investor Relations Peter Kelly - Chief Executive Officer Brad Lakhia - Executive Vice President and Chief Financial Officer Conference Call Participants Rajat Gupta - JPMorgan Craig Kennison - Baird John Murphy - Bank of America Bret Jordan - Jefferies Operator Good day and welcome to the OPENLANE Fourth Quarter and Year-End Results 2024 Conference Call. All participants will be ...

Flowserve Corporation (NYSE:FLS) Q4 2024 Earnings Conference Call February 19, 2025 10:00 AM ET Company Participants Brian Ezzell - VP, IR, Treasurer and Corporate Finance Scott Rowe - President and CEO Amy Schwetz - CFO Conference Call Participants Nathan Jones - Stifel Deane Dray - RBC Capital Markets Mike Halloran - Baird Joe Giordano - TD Cowen Brett Linzey - Mizuho Brian Ezzell Good day, and welcome to the Flowserve Fourth Quarter and Year End 2024 Earnings Conference Call. Today's conference is being ...

Financial Data and Key Metrics Changes - In 2024, Carvana achieved an adjusted EBITDA of $1.38 billion, with an adjusted EBITDA margin of 10.1%, marking it as the most profitable public automotive retailer in U.S. history [20][29] - The company reported a net income of $404 million and a net income margin of 3.1% for the year [20][29] - For Q4 2024, retail units sold totaled 114,379, a 50% increase year-over-year, with revenue reaching $3.547 billion, up 46% [21][22] Business Line Data and Key Metrics Changes - Non-GAAP retail GPU was $3,331, an increase of $361 year-over-year, driven by lower retail depreciation rates and reduced reconditioning costs [23] - Non-GAAP wholesale GPU decreased by 24% to $8.57, attributed to faster growth in retail units compared to wholesale units [24] - Non-GAAP other GPU increased to $2,728, up $849, due to higher spreads between origination interest rates and benchmark rates [25] Market Data and Key Metrics Changes - Carvana holds a 1% nationwide market share, with the largest competitor at 2% and the top 100 competitors combined at 10% [8][12] - The company integrated six of the 56 ADESA sites in 2024, with plans to open approximately 10 more mega sites in 2025 [10] Company Strategy and Development Direction - Carvana aims to leverage its unique business model to scale operations, targeting a capacity of approximately 3 million retail units through the integration of ADESA mega sites [9][10] - The company focuses on enhancing customer experience and operational efficiency, with plans to continue improving inventory selection and brand awareness [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving significant growth in both retail units sold and adjusted EBITDA in 2025, assuming a stable environment [31] - The company is committed to deleveraging its balance sheet while maintaining a strong liquidity position, with over $1.7 billion in cash and $3.6 billion in committed liquidity resources at the end of 2024 [30] Other Important Information - Carvana's operational efficiency initiatives led to a $1,165 reduction in non-GAAP SG&A expenses per retail unit sold [26] - The company plans to continue investing in inventory to drive customer satisfaction and conversion rates [39] Q&A Session Summary Question: Inventory management and customer experience improvements - Management emphasized the importance of selection in driving customer satisfaction and conversion, indicating a preference for increasing inventory despite potential depreciation risks [36][39] Question: GPU and margin drivers - Management noted that there are still fundamental gains to be achieved in GPU, with expectations for operational efficiencies to drive margins higher [58][60] Question: Loan sales strategy - The company plans to maintain a diversified funding strategy for loan sales, combining whole loan sales and securitization [75] Question: Credit rating improvement - Management highlighted the importance of strong financial metrics to improve credit ratings, with a focus on reducing net debt to adjusted EBITDA [84] Question: Growth capacity limitations - Management identified reconditioning capacity and operational execution as key factors limiting growth, with plans to scale operations effectively [88][89] Question: Market expansion and unit growth - Management indicated that future growth will primarily come from taking market share in existing markets rather than expanding into new ones [95][96]

Financial Data and Key Metrics Changes - Klaviyo reported Q4 revenue of $270 million, a 34% year-over-year increase, achieving a $1 billion revenue run rate [8][30] - For the full year, revenue grew by 34% to $937 million, with free cash flow of nearly $150 million [8][30] - Non-GAAP operating margin for Q4 was 6%, while the full year margin was 12%, exceeding the Rule of 40 [30][40] - Free cash flow for Q4 was $54 million, up 57% year-over-year, and $149 million for the year, up 35% [40] Business Line Data and Key Metrics Changes - Klaviyo added over 10,000 new customers in Q4, bringing the total to more than 167,000, a 17% year-over-year increase [31] - The number of customers generating over $50,000 in ARR increased by 46% year-over-year, totaling 2,850 [33] - The dollar-based net revenue retention rate (NRR) for Q4 was 108%, indicating strong expansion with existing customers [34] Market Data and Key Metrics Changes - EMEA revenue growth accelerated to 49% year-over-year, with notable strength in France, Germany, and the Nordics [36] - Combined international revenue grew by 22% year-over-year [36] - SMS coverage expanded to 19 countries, enhancing Klaviyo's global reach [12][88] Company Strategy and Development Direction - Klaviyo aims to deliver sustainable, efficient, long-term growth by moving upmarket, expanding internationally, and growing with existing customers [9][44] - The company is focused on enhancing its data platform and expanding its product offerings to redefine consumer engagement [25][26] - Partnerships, such as with WooCommerce, are seen as crucial for expanding into new markets and supporting diverse business models [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about improving external small business sentiment but noted that significant improvements in guidance are not yet assumed [50] - The company plans to continue investing in customer acquisition, international expansion, and product development in 2025 [44][51] - Management highlighted the importance of a data-first approach in meeting the evolving expectations of consumers [9][25] Other Important Information - Non-GAAP gross margins for Q4 were 74%, down approximately 5 points year-over-year due to increased infrastructure costs [37] - Pricing changes were introduced, including auto downgrade and flexible sending options, aimed at reducing friction for customers [41][130] - The company anticipates a modest increase in churn due to new pricing enforcement but expects minimal overall revenue benefit from these changes [120][134] Q&A Session Summary Question: Can you provide more color on your mid-market pipeline? - Management expressed satisfaction with the growth in the mid-market segment and noted that the average revenue per customer in Q4 was up 15% year-over-year, indicating strong product market fit [56][61] Question: How much are you leveraging PLG and word-of-mouth for upmarket growth? - Management stated that the product-led growth (PLG) approach is integral to their strategy, making the evaluation process smoother for mid-market and enterprise customers [64][67] Question: Can you update on ARR overlap with the Shopify ecosystem? - Management reported a strong relationship with Shopify, noting that many brands are moving to Klaviyo first before adopting Shopify for their e-commerce needs [74][76] Question: What is the outlook for international growth? - Management highlighted a 42% growth in international revenue for the full year and plans to hire local teams in key European markets to support further growth [87][90] Question: Can you elaborate on the new pricing features and their impact? - Management explained that the new pricing features aim to reduce friction and anchor pricing based on the value derived from customer data, with a slight uptick in churn expected [129][133]

Financial Data and Key Metrics Changes - The company reported fourth quarter total revenues of $921 million, exceeding guidance, with adjusted net income margin at 5.6% [22][30] - For the fiscal year, total revenues reached $3.58 billion, with adjusted earnings per share of $3.44, marking a 28% year-over-year increase [22][30] - Fourth quarter GAAP diluted net income per share was $0.83, while adjusted diluted net income per share was $1.04 [28] Business Line Data and Key Metrics Changes - Cheesecake Factory comparable sales increased by 1.7% year-over-year, with sales of $669.4 million, up 2% from the prior year [16][23] - North Italia sales were $81.3 million, up 21% from the prior year, with comparable sales increasing by 1% [16][23] - Flower Child sales totaled $38.2 million, up 25% from the prior year, with comparable sales increasing by 11% [19][23] Market Data and Key Metrics Changes - The Cheesecake Factory restaurant level margins for the fourth quarter were 18.4%, the highest level in over 7 years [14][15] - North Italia's restaurant-level profit margin for adjusted mature locations improved to 18.8% [17] - Flower Child's restaurant level profit margin for adjusted mature locations was 16.4% [19] Company Strategy and Development Direction - The company plans to open as many as 25 new restaurants in 2025, including 3 to 4 Cheesecake Factories and 6 to 7 North Italias [12][37] - The ongoing menu innovation is aimed at maintaining relevance without discounting, with over 20 new items introduced [10][11] - The company is focused on enhancing guest experiences and operational efficiencies to drive sustainable growth [13][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth potential of the portfolio, supported by strong consumer demand for high-quality dining experiences [13] - The company anticipates total revenues for fiscal 2025 to be approximately $3.8 billion, with a focus on maintaining operational improvements and margin expansion [34][36] - Management noted that the labor market remains stable, contributing positively to operational efficiency [120] Other Important Information - The company ended the quarter with total available liquidity of approximately $341 million, including a cash balance of about $84 million [29] - The company recorded a pretax net expense of $14.4 million related to impairment of assets and lease termination expenses [27] Q&A Session Summary Question: Clarification on revenue guidance for 2025 - Management indicated that the increase in revenue guidance to $3.8 billion is driven by unit growth and additional operating weeks from new openings [43] Question: Outlook for margin expansion in 2025 - Management acknowledged that while margin expansion is expected, the guidance is conservative due to increased preopening expenses and new unit openings [44][46] Question: Drivers of fourth quarter margin performance - Management highlighted strong sales and improved labor productivity as key drivers of margin performance across all concepts [52][54] Question: Trends in consumer behavior - Management noted that consumer behavior remains resilient, with no significant signs of anxiety impacting sales [140] Question: Impact of the rewards program - Management reported positive member acquisition and high guest satisfaction scores from the Cheesecake Rewards program, focusing on enhancing guest engagement [67][68] Question: Pricing expectations for 2025 - Management indicated that pricing will remain consistent, with no significant increases anticipated beyond current levels [73] Question: Performance of Flower Child - Management attributed the strong performance of Flower Child to increased brand awareness, catering introduction, and operational improvements [81] Question: Long-term margin potential for North Italia and Flower Child - Management expects North Italia to achieve mature margins similar to Cheesecake Factory, while Flower Child operates between 16% and 18% margins [152]

Financial Data and Key Metrics Changes - In Q4 2024, NerdWallet reported revenue of $184 million, a 37% year-over-year increase, and delivered $17 million in non-GAAP operating income [7][24] - Full year revenue reached $688 million, reflecting a 15% increase compared to the previous year [24] - Non-GAAP operating income margin remained similar to Q4 of the prior year despite increased brand investment [36] Business Line Data and Key Metrics Changes - Insurance revenue grew to $72 million in Q4, an increase of 821% year-over-year, driven by strong consumer and partner demand [33] - Banking products saw a 5% year-over-year growth, while credit card revenue declined by 19% year-over-year to $35 million [25][26] - Personal loans revenue decreased by 51% year-over-year, while mortgage revenue grew primarily due to the acquisition of Next Door Lending [9][27] Market Data and Key Metrics Changes - The SMB products segment generated $26 million in Q4, down 7% year-over-year, reflecting pressure from elevated rates and tight underwriting [30] - Emerging verticals, which include banking and investing, delivered $34 million in revenue for Q4, growing 7% year-over-year [34] - The overall lending environment remains cyclically depressed, impacting growth expectations across various segments [24][30] Company Strategy and Development Direction - The company is shifting focus from Monthly Unique Users (MUUs) to driving engaged relationships with consumers and SMBs, emphasizing quality over quantity [11][12] - Vertical Integration and Registrations & Data-Driven Reengagement are identified as key growth pillars for the company [70][72] - The company plans to continue investing in brand awareness, including a national campaign launched during the Super Bowl [15][47] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about returning to year-over-year growth in personal loans and expects revenue growth to be maintained throughout 2025 despite tough comparisons [44][46] - The company anticipates a challenging lending environment but remains committed to disciplined spending and strategic investments [48][49] - Management highlighted the importance of adapting to changes in the competitive landscape, particularly with the rise of AI and digital marketing [81][82] Other Important Information - Lauren StClair, the CFO, will be stepping down in March and will be succeeded by John Lee [21][22] - The company has grown its cumulative registered user base to 25 million in 2024 [20] Q&A Session Summary Question: Growth in Insurance Segment - Management noted that the growth in the insurance segment is driven by improved traffic flows and a growing market, with confidence in sustainable demand [56][58] Question: Q1 Margin Guidance - The Q1 guidance indicates a potential loss to breakeven, primarily due to increased brand spending and a larger mix of performance marketing [62][63] Question: Shift in Traffic Strategy - The decision to focus on quality relationships over MUUs was driven by a correlation between MUUs and revenue, leading to a strategic shift in internal goals [68][72] Question: Competitive Market Share - Management emphasized that partners evaluate based on customer lifetime value, and deeper engagement is becoming more valued than just top-of-funnel share [92][93] Question: Personal Loans Performance - Management acknowledged a focus on personal loans has been reestablished, with expectations for improvement in Q1 following a significant decline in Q4 [100] Question: Vertical Integration Opportunities - Management indicated that vertical integration opportunities exist in areas where financial guidance is beneficial, suggesting a broad approach to integration [104] Question: Brand Spend Efficiency - Management is focused on improving brand spend efficiency, particularly in sports marketing, while striving for better returns on investment [106]

Financial Data and Key Metrics Changes - For Q4 2024, reported net sales were $1.2 billion, down 0.6% year-over-year, but up 2.7% on a constant currency basis [39][40] - Full year 2024 net sales were $5 billion, down 1.4% year-over-year, but up 1.2% on a constant currency basis [41][42] - Adjusted EBITDA for Q4 was $150 million, exceeding guidance, with a margin of 12.4%, up 340 basis points year-over-year [43][58] - Full year adjusted EBITDA was $635 million, significantly up from $571 million in 2023, with a margin of 12.7%, up 140 basis points [44][70] Business Line Data and Key Metrics Changes - New distributor growth was up 22% year-over-year in Q4, marking the third consecutive quarter of growth, and up 11% for the full year compared to 2023 [26][29] - Active non-sales leaders showed year-over-year growth for the third consecutive quarter, indicating a positive trend in distributor engagement [28][31] - Sales leader retention rate improved from 68.3% to 70.3% year-over-year, reflecting better distributor support and training initiatives [31][70] Market Data and Key Metrics Changes - Latin America reported net sales growth of 2% on a reported basis and 15% on a local currency basis [51] - EMEA net sales were up 3% year-over-year on a reported basis and 6% on a local currency basis [53] - Asia-Pacific net sales increased by 1% on a reported basis and 3% on a local currency basis [54] - North America saw a decline of 3% year-over-year in net sales, but trends showed improvement over the last three quarters [55][81] - China experienced a significant decline of 20% year-over-year in net sales, attributed to volume declines and strategic shifts [57][99] Company Strategy and Development Direction - The company aims to become one of the world's most important health and wellness platforms, focusing on digital transformation and distributor engagement [24][34] - Initiatives launched in 2024 to rebuild the distributor base and improve activity levels are yielding positive results [25][31] - The company is addressing market-specific challenges with optimization strategies, particularly in Latin America [30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the improving distributor metrics and the potential for growth in 2025, despite currency headwinds [70][72] - The company is focused on leveraging industry disruptors and adapting to changing consumer trends [33][72] - Management acknowledged the challenges in the North American market but indicated that improvements are on track [80][82] Other Important Information - The company reduced its total leverage ratio to 3.2 times as of December 31, down from 3.9 times at the end of 2023 [48][61] - The company plans to pay down $1 billion of debt by the end of 2028, with a target to reduce debt to $1.4 billion [61][62] - The company is experiencing a significant currency headwind, projected to impact 2025 net sales and adjusted EBITDA [63][66] Q&A Session Summary Question: What needs to happen to turn around North American volume trends? - Management indicated the need to rebuild the distributor and supervisor base, with positive signs of improvement after 14 quarters of decline [78][80] Question: Is the plan to repay the 2025 maturity just once it comes due in September? - Management confirmed the plan to repay the 2025 notes in September, with some revolver drawn to assist in the repayment [83][84] Question: Can you discuss the constant currency sales guidance range for 2025? - Management explained that the wide range reflects potential opportunities in China and the US, with more upside than downside risks [89][90] Question: What is the situation in China regarding revenue decline? - Management noted a strategic shift towards a customer-focused approach, which has yielded some positive results but is still in transition [98][100] Question: How do you view the preferred customer declines in North America? - Management acknowledged the need to balance transactional and transformational aspects of the business to improve preferred customer metrics [103][106]

Financial Data and Key Metrics Changes - Record portfolio purchases of $1.4 billion, up 22% year-over-year [8][27] - Cash collections of $1.9 billion for the year, representing 13% year-over-year growth [10][37] - Net income attributable to PRA of $71 million, translating to a return on average tangible equity of 10%, a significant improvement from negative 11% in 2023 [11][49] - Total revenues were $293 million for the quarter and $1.1 billion for the full year, up 32% and 39% respectively [31] Business Line Data and Key Metrics Changes - U.S. portfolio purchases were $796 million for the full year, up 40% year-over-year [28] - European portfolio purchases were $229 million for the quarter, up 86% year-over-year [30] - U.S. legal cash collections increased 42% to $376 million from $264 million in 2023 [21] Market Data and Key Metrics Changes - Strong portfolio supply in the U.S. driven by rising credit card balances and elevated charge-off rates [29] - European business demonstrated strong market position with healthy diversification across markets [13][14] Company Strategy and Development Direction - Three strategic pillars driving enhanced profitability: optimizing investments, driving operational execution, and managing expenses [18] - Focus on expanding offshore teams to improve cost structure and efficiency [23][24] - Continued investment in legal collections channel expected to drive future cash collections [33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to navigate short-term consumer pressures due to the long-term nature of their collections model [40] - Anticipated strong U.S. portfolio supply in 2025, driven by rising credit card balances [19] - Management remains optimistic about the company's transformation and growth potential [25][50] Other Important Information - ERC at December 31, 2024, was $7.5 billion, up 17% compared to the previous year [41] - Debt-to-adjusted EBITDA ratio was 2.92 times, within the long-term target range [43][44] - Company expects to exceed $1.2 billion in portfolio purchases for 2025 [48] Q&A Session Summary Question: Insights on European market supply and competition - Management noted an unusually large volume of market supply in Europe, but did not see significant changes in competition [54][56] Question: Thoughts on cash efficiency ratio and potential ceilings - Management indicated expectations for improved cash efficiency ratios in the short and long term, driven by operational efficiencies and technology [59][63] Question: Regulatory landscape and potential new competitors - Management expressed that while the regulatory environment is being monitored, significant barriers remain for new entrants into the market [66][68] Question: Legal expenses and efficiency ratio expectations - Management confirmed that legal expenses are expected to fluctuate based on portfolio mix and investments, but they remain confident in achieving efficiency targets [110][112]

Financial Data and Key Metrics Changes - Subscription revenue grew 20% year-over-year, achieving a record adjusted operating income of $114 million for the full year of 2024, with a 40% increase [9][10] - Free cash flow reached an all-time high of $39 million, primarily driven by higher adjusted operating income [10] - Total revenue for Q4 2024 was $337.3 million, up 14% year-over-year, with subscription revenue at $227.8 million, up 19% year-over-year [29][41] Business Line Data and Key Metrics Changes - The subscription business achieved an adjusted operating margin of 15.3%, up from 13% in the prior year, marking the highest margin in the company's history [35] - The other business segment generated $109.5 million in revenue for the quarter, a 5% increase year-over-year, but adjusted operating margin decreased to 0.8% [37][38] Market Data and Key Metrics Changes - Total subscription pets increased by 5% year-over-year to over 1,041,000 pets, including over 51,000 pets in Europe [30] - Average monthly retention for the trailing 12 months was 98.25%, slightly down from 98.49% the previous year [31] Company Strategy and Development Direction - The company aims to grow adjusted operating income and strategically reinvest at high estimated internal rates of return to support more pets receiving care [11] - In 2025, the company anticipates steady growth in the subscription business, with a focus on increasing pet acquisition investment as the year progresses [20][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in margin trajectory due to recent trends in veterinary inflation aligning with expectations, anticipating improved margin performance throughout 2025 [21] - The company expects to exit 2025 with the highest per pet profit and expanding allowable pet acquisition costs, setting the stage for a return to historical growth rates [49] Other Important Information - The company reported a net income of $1.7 million for Q4 2024, compared to a net loss of $2.2 million in the prior year [41] - A goodwill impairment charge of $5.3 million was recorded related to European businesses, following a detailed business review [40][112] Q&A Session Summary Question: Can you talk about the progression of subscriber growth throughout the year? - Management indicated that they plan to gradually increase pet acquisition investment throughout 2025, aiming to approach the investment levels seen in 2022 [56] Question: What does the increase in veterinary leads mean for the business? - Management noted a 30% year-over-year increase in vet leads, indicating strong lead generation and a focus on converting these leads into subscriptions [62] Question: What is the outlook for 2025 adjusted operating margins? - Management expects margin expansion but noted that inflation will be a significant factor, with expectations of continued inflation at around 15% [91][92]