Compass Diversified (NYSE: CODI) (“CODI” or the “Company”), an
owner of leading middle market branded consumer and industrial
businesses, announced today its consolidated operating results for
the three and twelve months ended December 31, 2023.
“Our fourth quarter results exceeded our
expectations and demonstrate that owning premium businesses with
defensible competitive moats drives strong financial performance,”
said Elias Sabo, CEO of Compass Diversified. “At a consolidated
level, our business saw strong revenue, net income, and Subsidiary
Adjusted EBITDA growth in the fourth quarter led by Lugano
Diamonds. While the economic backdrop remains uncertain for many,
our diversified business model continues to shine, and has us
feeling optimistic that we will provide a strong shareholder return
in the coming year.”
Sabo continued: “Our differentiated competitive
advantage of a permanent capital structure and a lower cost of
capital enabled our opportunistic sale of Marucci Sports in
November and our acquisition of The Honey Pot Company in early
2024. Inclusive of The Honey Pot Company acquisition, we expect to
see above trend growth in consolidated financial performance in
2024, on a pro forma basis.”
Fourth Quarter and Full Year 2023
Financial Summary vs. Same Year-Ago Period (where
applicable)
- Net sales in the fourth quarter up
7% to $567.0 million. For the full year 2023, net sales up 2% to
$2.1 billion, and roughly flat on a pro forma basis.
- Branded consumer net sales in the
fourth quarter up 13% to $371.9 million. For the full year 2023,
branded consumer pro forma net sales up 3% to $1.3 billion.
- Industrial net sales in the fourth
quarter down 3% to $195.1 million. For the full year 2023,
industrial net sales down 5% to $728.5 million.
- Net income in the fourth quarter of
$139.4 million vs. $8.7 million last year. For the full year 2023,
net income of $262.4 million vs. $51.4 million. The increase in
both periods was primarily due to the $179.5 million gain on the
sale of Marucci Sports in November 2023 and the $98.0 million gain
on the sale of Advanced Circuits in February 2023.
- Loss from continuing operations in
the fourth quarter of $36.4 million vs. $4.6 million in the prior
year period. For the full year 2023, loss from continuing
operations of $38.7 million vs. income from continuing operations
of $3.7 million for full year 2022. The increases in net loss from
continuing operations were primarily due to non-cash impairment
charges associated with PrimaLoft and Velocity Outdoor.
- Adjusted Earnings, a non-GAAP
financial measure, in the fourth quarter was $38.1 million vs.
$16.3 million for the fourth quarter of 2022. For the full year
2023, Adjusted Earnings was $116.7 million vs. $110.2 million in
the prior year.
- Adjusted EBITDA, a non-GAAP
financial measure, in the fourth quarter was up 35% to $94.8
million. For the full year 2023, Adjusted EBITDA was up 11% to
$340.9 million.
- Paid a fourth quarter 2023 cash
distribution of $0.25 per share on CODI's common shares in January
2024.
Recent Business Highlights
- On February 1, 2024, CODI announced
the completion of its partnership with The Honey Pot Company, a
leading “better-for-you” feminine care brand, for an enterprise
value of $380 million.
- On January 17, 2024, CODI hosted an
Investor Day in Newport Beach, California, showcasing its Lugano
Diamonds and 5.11 subsidiaries. A replay of the Lugano Diamonds and
Compass Diversified presentations has been made available on the
Investor Relations page of the Company’s website at
compassdiversified.com.
- On December 21, 2023, CODI
announced the completion of a private placement of approximately
3.6 million of its common shares to a mutual fund managed by
Allspring Global Investments, LLC for $21.18 per share, or an
aggregate sale price of approximately $75.2 million, before
commissions and expenses.
- On December 19, 2023, PrimaLoft
Inc., a subsidiary of CODI and a leading provider of branded,
high-performance synthetic insulation and materials used primarily
in consumer outerwear and accessories, announced the appointment of
Anne Cavassa as CEO.
- On November 15, 2023, CODI
announced the completion of the sale of Marucci Sports to Fox
Factory Holding Corp. (Nasdaq: FOXF) for an enterprise value of
$572 million. CODI realized a $179.5 million gain on the sale of
Marucci Sports.
Fourth Quarter and Full Year 2023
Financial Results
Net sales in the fourth quarter of 2023 were
$567.0 million, up 7% compared to $529.7 million in the fourth
quarter of 2022. For the full year 2023, net sales were $2.1
billion, up 2% compared to $2.0 billion a year ago. This was driven
by a 63% increase in Lugano net sales, somewhat offset by lower net
sales at PrimaLoft and Velocity Outdoor due to inventory destocking
headwinds and reduced wholesale demand. On a pro forma basis,
assuming CODI had acquired PrimaLoft on January 1, 2022, net sales
were roughly flat in the full year 2023.
Branded consumer net sales increased 13% in the
fourth quarter of 2023 to $371.9 million compared to the fourth
quarter of 2022. On a pro forma basis, branded consumer net sales
increased 3% to $1.3 billion in the full year 2023 compared to a
year ago.
Industrial net sales decreased 3% in the fourth
quarter of 2023 to $195.1 million compared to the fourth quarter of
2022, and decreased 5% to $728.5 million in the full year 2023
compared to a year ago.
Operating loss for the fourth quarter of 2023
was $4.0 million compared to operating income of $26.8 million in
the fourth quarter of 2022. For the full year 2023, operating
income decreased 31% to $90.1 million compared to $130.8 million a
year ago. The decline was primarily due to a $56.8 million non-cash
impairment expense associated with PrimaLoft in the fourth quarter
of 2023.
Net income in the fourth quarter of 2023 was
$139.4 million compared to net income of $8.7 million in the fourth
quarter of 2022. For the full year 2023, net income was $262.4
million compared to $51.4 million a year ago. The increases in net
income were due primarily to the $179.5 million gain on the sale of
Marucci Sports in November 2023 and the $98.0 million gain on the
sale of Advanced Circuits in February 2023.
Loss from continuing operations in the fourth
quarter of 2023 was $36.4 million compared to $4.6 million in the
fourth quarter of 2022. For the full year 2023, loss from
continuing operations was $38.7 million compared to income from
continuing operations of $3.7 million a year ago. The increases in
net loss from continuing operations were primarily due to the
non-cash impairment expenses associated with PrimaLoft and Velocity
Outdoor.
Adjusted Earnings (see “Note Regarding Use of
Non-GAAP Financial Measures” below) for the fourth quarter of 2023
was $38.1 million compared to $16.3 million a year ago. For the
full year 2023, Adjusted Earnings was $116.7 million compared to
$110.2 million a year ago. CODI's weighted average number of shares
outstanding in the fourth quarter of 2023 was 72.43 million
compared to 72.20 million in the prior year fourth quarter. For the
full year 2023, CODI’s weighted average number of shares
outstanding was 72.11 million compared to 70.72 million in
2022.
Adjusted EBITDA (see “Note Regarding Use of
Non-GAAP Financial Measures” below) in the fourth quarter of 2023
was $94.8 million, up 35% compared to $70.0 million in the fourth
quarter of 2022. For the full year 2023, Adjusted EBITDA was $340.9
million, up 11% compared to $306.0 million a year ago. The
increases were primarily due to strong results at Lugano and the
Company’s Industrial subsidiaries. The Company no longer adds back
management fees in its calculation of Adjusted EBITDA. Management
fees incurred during the fourth quarter and full year were $16.9
million and $68.4 million, respectively.
Liquidity and Capital
Resources
As of December 31, 2023, CODI had approximately
$450.5 million in cash and cash equivalents, $2.2 million
outstanding on its revolver, $385.0 million outstanding in term
loans, $1.0 billion outstanding in 5.250% Senior Notes due 2029 and
$300.0 million outstanding in 5.000% Senior Notes due 2032.
As of December 31, 2023, the Company had no
significant debt maturities until 2027 and had net borrowing
availability of approximately $598 million under its revolving
credit facility.
Fourth Quarter 2023
Distributions
On January 4, 2024, CODI’s Board declared a
fourth quarter distribution of $0.25 per share on the Company's
common shares. The cash distribution was paid on January 25, 2024,
to all holders of record of common shares as of January 18,
2024.
The Board also declared a quarterly cash
distribution of $0.453125 per share on the Company’s 7.250% Series
A Preferred Shares (the “Series A Preferred Shares”). The
distribution on the Series A Preferred Shares covers the period
from, and including, October 30, 2023, up to, but excluding,
January 30, 2024. The distribution for such period was payable on
January 30, 2024, to all holders of record of Series A Preferred
Shares as of January 15, 2024.
The Board also declared a quarterly cash
distribution of $0.4921875 per share on the Company’s 7.875% Series
B Preferred Shares (the “Series B Preferred Shares”). The
distribution on the Series B Preferred Shares covers the period
from, and including, October 30, 2023, up to, but excluding,
January 30, 2024. The distribution for such period was payable on
January 30, 2024, to all holders of record of Series B Preferred
Shares as of January 15, 2024.
The Board also declared a quarterly cash
distribution of $0.4921875 per share on the Company’s 7.875% Series
C Preferred Shares (the “Series C Preferred Shares”). The
distribution on the Series C Preferred Shares covers the period
from, and including, October 30, 2023, up to, but excluding,
January 30, 2024. The distribution for such period was payable on
January 30, 2024, to all holders of record of Series C Preferred
Shares as of January 15, 2024.
2024 Outlook
CODI expects its current subsidiaries, inclusive
of The Honey Pot Company as if we owned it from January 1, 2024, to
produce consolidated Subsidiary Adjusted EBITDA (see “Note
Regarding Use of Non-GAAP Financial Measures” below) for the full
year 2024 of between $480 million and $520 million. Of this range,
CODI expects its Branded Consumer vertical to produce $355 million
to $385 million and its Industrial vertical to produce $125 million
to $135 million. This estimate is based on the summation of the
Company’s expectations for its current subsidiaries in 2024, and is
absent additional acquisitions or divestitures, and excludes
corporate expenses such as interest expense, management fees paid
by CODI and corporate overhead.
CODI is now providing guidance for Adjusted
EBITDA (see “Note Regarding Use of Non-GAAP Financial Measures”
below) including management fees and corporate expenses, and
expects to earn between $390 million and $430 million for the full
year 2024. Adjusted EBITDA only includes results from The Honey Pot
Company from the date of acquisition.
In addition, the Company expects to earn between
$145 million and $160 million in Adjusted Earnings (see “Note
Regarding Use of Non-GAAP Financial Measures” below) for the full
year 2024.
In reliance on the unreasonable efforts
exception provided under Item 10(e)(1)(i)(B) of Regulation S-K,
CODI has not reconciled 2024 consolidated Subsidiary Adjusted
EBITDA, 2024 Adjusted EBITDA or 2024 Adjusted Earnings to their
comparable GAAP measure because it does not provide guidance on
Income (Loss) from Continuing Operations or Net Income (Loss) or
the applicable reconciling items as a result of the uncertainty
regarding, and the potential variability of, these items. For the
same reasons, CODI is unable to address the probable significance
of the unavailable information, which could be material to future
results.
Conference Call
Management will host a conference call on
Wednesday, February 28, 2024, at 5:00 p.m. ET to discuss the latest
corporate developments and financial results. The dial-in number
for callers in the U.S. is (888) 259-6580 and the dial-in number
for international callers is (416) 764-8624. The Conference ID is
60782779. The conference call will also be available via a live
listen-only webcast and can be accessed through the Investor
Relations section of CODI's website. An online replay of the
webcast will be available on the same website following the call.
Please allow extra time prior to the call to visit the site and
download any necessary software that may be needed to listen to the
Internet broadcast. A replay of the call will be available through
Wednesday, March 6, 2024. To access the replay, please dial (877)
674-7070 in the U.S. and (416) 764-8692 outside the U.S.
Note Regarding Use of Non-GAAP Financial
Measures
Adjusted EBITDA and Adjusted Earnings are
non-GAAP measures used by the Company to assess its performance. We
have reconciled Adjusted EBITDA to Income (Loss) from Continuing
Operations and Adjusted Earnings to Net Income (Loss) on the
attached schedules. We consider Income (Loss) from Continuing
Operations to be the most directly comparable GAAP financial
measure to Adjusted EBITDA and Net Income (Loss) to be the most
directly comparable GAAP financial measure to Adjusted Earnings. We
believe that Adjusted EBITDA and Adjusted Earnings provides useful
information to investors and reflect important financial measures
as each excludes the effects of items which reflect the impact of
long-term investment decisions, rather than the performance of
near-term operations. When compared to Net Income (Loss) and Income
(Loss) from Continuing Operations, Adjusted Earnings and Adjusted
EBITDA, respectively, are each limited in that they do not reflect
the periodic costs of certain capital assets used in generating
revenues of our businesses or the non-cash charges associated with
impairments, as well as certain cash charges. The presentation of
Adjusted EBITDA allows investors to view the performance of our
businesses in a manner similar to the methods used by us and the
management of our businesses, provides additional insight into our
operating results and provides a measure for evaluating targeted
businesses for acquisition. The presentation of Adjusted Earnings
provides insight into our operating results and provides a measure
for evaluating earnings from continuing operations available to
common shareholders.
Pro forma net sales is defined as net sales
including the historical net sales relating to the pre-acquisition
periods of PrimaLoft, assuming that the Company acquired PrimaLoft
on January 1, 2022. We have reconciled pro forma net sales to net
sales, the most directly comparable GAAP financial measure, on the
attached schedules. We believe that pro forma net sales is useful
information for investors as it provides a better understanding of
sales performance, and relative changes thereto, on a comparable
basis. Pro forma net sales is not necessarily indicative of what
the actual results would have been if the acquisition had in fact
occurred on the date or for the periods indicated nor does it
purport to project net sales for any future periods or as of any
date.
In reliance on the unreasonable efforts
exception provided under Item 10(e)(1)(i)(B) of Regulation S-K, we
have not reconciled 2024 consolidated Subsidiary Adjusted EBITDA,
2024 Adjusted EBITDA or 2024 Adjusted Earnings to their comparable
GAAP measures because we do not provide guidance on Net Income
(Loss) from Continuing Operations or Net Income (Loss) or the
applicable reconciling items as a result of the uncertainty
regarding, and the potential variability of, these items. For the
same reasons, we are unable to address the probable significance of
the unavailable information, which could be material to future
results.
Adjusted EBITDA, Adjusted Earnings and pro forma
net sales are not meant to be a substitute for GAAP measures and
may be different from or otherwise inconsistent with non-GAAP
financial measures used by other companies.
About Compass Diversified
Since its founding in 1998 and IPO in 2006, CODI
has consistently executed on its strategy of owning and managing a
diverse set of highly defensible, middle-market businesses across
the industrial, branded consumer, and healthcare sectors. The
Company leverages its permanent capital base, long-term disciplined
approach, and actionable expertise to maintain controlling
ownership interests in each of its subsidiaries, maximizing its
ability to impact long-term cash flow generation and value
creation. The Company provides both debt and equity capital for its
subsidiaries, contributing to their financial and operating
flexibility. CODI utilizes the cash flows generated by its
subsidiaries to invest in the long-term growth of the Company and
has consistently generated strong returns through its culture of
transparency, alignment, and accountability. For more information,
please visit compassdiversified.com.
Forward Looking Statements
Certain statements in this press release may be
deemed forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include, but are not limited to, statements as to our
future performance or liquidity, such as expectations regarding our
results of operations and financial condition, our 2024
consolidated Subsidiary Adjusted EBITDA, our 2024 Adjusted EBITDA,
our 2024 Adjusted Earnings, our pending acquisitions and
divestitures, and other statements with regard to the future
performance of CODI. We may use words such as “plans,”
“anticipate,” “believe,” “expect,” “intend,” “will,” “should,”
“may,” “seek,” “look,” and similar expressions to identify
forward-looking statements. The forward-looking statements
contained in this press release involve risks and uncertainties.
Actual results could differ materially from those implied or
expressed in the forward-looking statements for any reason,
including the factors set forth in “Risk Factors” and elsewhere in
CODI’s annual report on Form 10-K and its quarterly reports on Form
10-Q. Other factors that could cause actual results to differ
materially include: changes in the economy, financial markets and
political environment, including changes in inflation and interest
rates; risks associated with possible disruption in CODI’s
operations or the economy generally due to terrorism, war, natural
disasters, social, civil and political unrest or the COVID-19
pandemic; future changes in laws or regulations (including the
interpretation of these laws and regulations by regulatory
authorities); environmental risks affecting the business or
operations of our subsidiaries; disruption in the global supply
chain, labor shortages and high labor costs; our business prospects
and the prospects of our subsidiaries; the impact of, and ability
to successfully complete and integrate, acquisitions that we may
make; the ability to successfully complete when we’ve executed
divestitures agreements; the dependence of our future success on
the general economy and its impact on the industries in which we
operate; the ability of our subsidiaries to achieve their
objectives; the adequacy of our cash resources and working capital;
the timing of cash flows, if any, from the operations of our
subsidiaries; and other considerations that may be disclosed from
time to time in CODI’s publicly disseminated documents and filings.
Undue reliance should not be placed on such forward-looking
statements as such statements speak only as of the date on which
they are made. Although, except as required by law, CODI undertakes
no obligation to revise or update any forward-looking statements,
whether as a result of new information, future events or otherwise,
you are advised to consult any additional disclosures that CODI may
make directly to you or through reports that it in the future may
file with the SEC, including annual reports on Form 10-K, quarterly
reports on Form 10-Q and current reports on Form 8-K.
Investor
Relationsirinquiry@compassdiversified.com
Gateway GroupCody
Slach949.574.3860CODI@gateway-grp.com
Media
RelationsMediainquiry@compassdiversified.com
The IGB GroupLeon
Berman212.477.8438lberman@igbir.com
| |
|
Compass Diversified Holdings |
|
Condensed Consolidated Balance Sheets |
| |
|
|
|
|
| (in thousands) |
|
December 31, 2023 |
|
December 31, 2022 |
| |
|
|
|
|
| Assets |
|
|
|
|
| Current assets |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
450,477 |
|
|
$ |
56,599 |
|
| Accounts receivable, net |
|
|
318,241 |
|
|
|
297,722 |
|
| Inventories, net |
|
|
740,387 |
|
|
|
680,545 |
|
| Prepaid expenses and other
current assets |
|
|
94,715 |
|
|
|
73,200 |
|
| Current assets of discontinued
operations |
|
|
— |
|
|
|
102,119 |
|
| Total current assets |
|
|
1,603,820 |
|
|
|
1,210,185 |
|
| Property, plant and equipment,
net |
|
|
192,562 |
|
|
|
184,501 |
|
| Goodwill |
|
|
901,428 |
|
|
|
991,007 |
|
| Intangible assets, net |
|
|
923,905 |
|
|
|
1,015,497 |
|
| Other non-current assets |
|
|
195,266 |
|
|
|
162,392 |
|
| Non-current assets of
discontinued operations |
|
|
— |
|
|
|
286,049 |
|
| Total
assets |
|
$ |
3,816,981 |
|
|
$ |
3,849,631 |
|
| |
|
|
|
|
| Liabilities and
stockholders’ equity |
|
|
|
|
| Current liabilities |
|
|
|
|
| Accounts payable |
|
$ |
93,412 |
|
|
$ |
82,942 |
|
| Accrued expenses |
|
|
150,725 |
|
|
|
177,245 |
|
| Deferred revenue |
|
|
6,731 |
|
|
|
7,093 |
|
| Due to related parties |
|
|
16,025 |
|
|
|
15,495 |
|
| Current portion, long-term
debt |
|
|
10,000 |
|
|
|
10,000 |
|
| Other current liabilities |
|
|
35,465 |
|
|
|
35,286 |
|
| Current liabilities of
discontinued operations |
|
|
— |
|
|
|
31,771 |
|
| Total current liabilities |
|
|
312,358 |
|
|
|
359,832 |
|
| Deferred income taxes |
|
|
120,131 |
|
|
|
142,627 |
|
| Long-term debt |
|
|
1,661,879 |
|
|
|
1,824,468 |
|
| Other non-current
liabilities |
|
|
203,232 |
|
|
|
139,267 |
|
| Non-current liabilities of
discontinued operations |
|
|
— |
|
|
|
21,475 |
|
| Total
liabilities |
|
|
2,297,600 |
|
|
|
2,487,669 |
|
| Stockholders'
equity |
|
|
|
|
| Total stockholders' equity
attributable to Holdings |
|
|
1,326,750 |
|
|
|
1,136,920 |
|
| Noncontrolling interest |
|
|
192,631 |
|
|
|
203,464 |
|
| Noncontrolling interest of
discontinued operations |
|
|
— |
|
|
|
21,578 |
|
| Total stockholders'
equity |
|
|
1,519,381 |
|
|
|
1,361,962 |
|
| Total liabilities and
stockholders’ equity |
|
$ |
3,816,981 |
|
|
$ |
3,849,631 |
|
|
Compass Diversified Holdings |
|
Consolidated Statements of Operations |
| |
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
Year ended December 31, |
|
(in thousands, except per share data) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| Net revenues |
|
$ |
566,989 |
|
|
$ |
529,682 |
|
|
$ |
2,058,876 |
|
|
$ |
2,009,130 |
|
| Cost of revenues |
|
|
320,682 |
|
|
|
327,934 |
|
|
|
1,165,553 |
|
|
|
1,226,078 |
|
| Gross
profit |
|
|
246,307 |
|
|
|
201,748 |
|
|
|
893,323 |
|
|
|
783,052 |
|
| Operating expenses: |
|
|
|
|
|
|
|
|
| Selling, general and
administrative expense |
|
|
152,626 |
|
|
|
132,969 |
|
|
|
549,589 |
|
|
|
484,369 |
|
| Management fees |
|
|
16,909 |
|
|
|
17,050 |
|
|
|
68,445 |
|
|
|
62,604 |
|
| Amortization expense |
|
|
23,914 |
|
|
|
24,886 |
|
|
|
95,820 |
|
|
|
84,689 |
|
| Impairment expense |
|
|
56,832 |
|
|
|
— |
|
|
|
89,400 |
|
|
|
20,552 |
|
| Operating income
(loss) |
|
|
(3,974 |
) |
|
|
26,843 |
|
|
|
90,069 |
|
|
|
130,838 |
|
| Other income (expense): |
|
|
|
|
|
|
|
|
| Interest expense, net |
|
|
(24,826 |
) |
|
|
(25,768 |
) |
|
|
(105,179 |
) |
|
|
(83,492 |
) |
| Amortization of debt issuance
costs |
|
|
(1,004 |
) |
|
|
(1,005 |
) |
|
|
(4,038 |
) |
|
|
(3,740 |
) |
| Loss on debt
extinguishment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(534 |
) |
| Other income (expense),
net |
|
|
(357 |
) |
|
|
(1,349 |
) |
|
|
1,743 |
|
|
|
(2,321 |
) |
| Net income (loss)
before income taxes |
|
|
(30,161 |
) |
|
|
(1,279 |
) |
|
|
(17,405 |
) |
|
|
40,751 |
|
| Provision (benefit) for income
taxes |
|
|
6,254 |
|
|
|
3,313 |
|
|
|
21,331 |
|
|
|
37,093 |
|
| Income (loss) from
continuing operations |
|
|
(36,415 |
) |
|
|
(4,592 |
) |
|
|
(38,736 |
) |
|
|
3,658 |
|
| Income (loss) from
discontinued operations, net of income tax |
|
|
(3,674 |
) |
|
|
10,800 |
|
|
|
18,116 |
|
|
|
38,387 |
|
| Gain on sale of discontinued
operations |
|
|
179,530 |
|
|
|
2,500 |
|
|
|
283,025 |
|
|
|
9,393 |
|
| Net
income |
|
|
139,441 |
|
|
|
8,708 |
|
|
|
262,405 |
|
|
|
51,438 |
|
| Less: Net income (loss)
attributable to noncontrolling interest |
|
|
2,555 |
|
|
|
(1,131 |
) |
|
|
15,945 |
|
|
|
10,367 |
|
| Less: Net income (loss) from
discontinued operations attributable to noncontrolling
interest |
|
|
(551 |
) |
|
|
1,255 |
|
|
|
174 |
|
|
|
4,684 |
|
| Net income
attributable to Holdings |
|
$ |
137,437 |
|
|
$ |
8,584 |
|
|
$ |
246,286 |
|
|
$ |
36,387 |
|
| |
|
|
|
|
|
|
|
|
| Basic income (loss) per common
share attributable to Holdings |
|
|
|
|
|
|
|
|
| Continuing operations |
|
$ |
(0.74 |
) |
|
$ |
(0.50 |
) |
|
$ |
(1.71 |
) |
|
$ |
(0.66 |
) |
| Discontinued operations |
|
|
2.44 |
|
|
|
0.16 |
|
|
|
4.17 |
|
|
|
0.56 |
|
| |
|
$ |
1.70 |
|
|
$ |
(0.34 |
) |
|
$ |
2.46 |
|
|
$ |
(0.10 |
) |
| |
|
|
|
|
|
|
|
|
| Basic weighted average number
of common shares outstanding |
|
|
72,429 |
|
|
|
72,203 |
|
|
|
72,105 |
|
|
|
70,715 |
|
| |
|
|
|
|
|
|
|
|
| Cash distributions declared
per Trust common share |
|
$ |
0.25 |
|
|
$ |
0.25 |
|
|
$ |
1.00 |
|
|
$ |
1.00 |
|
|
Compass Diversified Holdings |
|
Net Income to Non-GAAP Adjusted Earnings and Non-GAAP
Adjusted EBITDA - 2023 |
|
(Unaudited) |
| |
|
|
|
|
| |
|
Three months ended |
|
Year ended |
| (in thousands) |
|
March 31, 2023 |
|
June 30, 2023 |
|
September 30, 2023 |
|
December 31, 2023 |
|
December 31, 2023 |
|
Net income (loss) |
|
$ |
109,601 |
|
|
$ |
17,123 |
|
|
$ |
(3,760 |
) |
|
$ |
139,441 |
|
|
$ |
262,405 |
|
| Gain on sale of discontinued
operations, net of tax |
|
|
97,989 |
|
|
|
4,232 |
|
|
|
1,274 |
|
|
|
179,530 |
|
|
|
283,025 |
|
| Income (loss) from
discontinued operations, net of tax |
|
|
10,000 |
|
|
|
2,840 |
|
|
|
8,950 |
|
|
|
(3,674 |
) |
|
|
18,116 |
|
| Net income (loss) from
continuing operations |
|
$ |
1,612 |
|
|
$ |
10,051 |
|
|
$ |
(13,984 |
) |
|
$ |
(36,415 |
) |
|
$ |
(38,736 |
) |
| Less: income from continuing
operations attributable to noncontrolling interest |
|
|
4,171 |
|
|
|
3,498 |
|
|
|
5,721 |
|
|
|
2,555 |
|
|
|
15,945 |
|
| Net income (loss)
attributable to Holdings - continuing operations |
|
$ |
(2,559 |
) |
|
$ |
6,553 |
|
|
$ |
(19,705 |
) |
|
$ |
(38,970 |
) |
|
$ |
(54,681 |
) |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
| Distributions paid - preferred
shares |
|
|
(6,045 |
) |
|
|
(6,046 |
) |
|
|
(6,045 |
) |
|
|
(6,045 |
) |
|
|
(24,181 |
) |
| Amortization expense -
intangible assets and inventory step-up |
|
|
25,148 |
|
|
|
23,977 |
|
|
|
23,956 |
|
|
|
23,914 |
|
|
|
96,995 |
|
| Impairment expense |
|
|
— |
|
|
|
— |
|
|
|
32,568 |
|
|
|
56,832 |
|
|
|
89,400 |
|
| Tax effect - impairment
expense |
|
|
— |
|
|
|
— |
|
|
|
(4,308 |
) |
|
|
978 |
|
|
|
(3,330 |
) |
| Non-controlling interest -
impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(5,382 |
) |
|
|
(5,382 |
) |
| Non-controlling shareholder
compensation |
|
|
1,641 |
|
|
|
3,207 |
|
|
|
2,750 |
|
|
|
3,067 |
|
|
|
10,665 |
|
| Acquisition expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
321 |
|
|
|
321 |
|
| Integration services fee |
|
|
1,187 |
|
|
|
1,188 |
|
|
|
— |
|
|
|
— |
|
|
|
2,375 |
|
| Other |
|
|
432 |
|
|
|
348 |
|
|
|
349 |
|
|
|
3,377 |
|
|
|
4,506 |
|
| Adjusted
earnings |
|
$ |
19,804 |
|
|
$ |
29,227 |
|
|
$ |
29,565 |
|
|
$ |
38,092 |
|
|
$ |
116,688 |
|
| Plus (less): |
|
|
|
|
|
|
|
|
|
|
| Depreciation expense |
|
|
11,155 |
|
|
|
12,107 |
|
|
|
11,994 |
|
|
|
11,291 |
|
|
|
46,547 |
|
| Income tax provision |
|
|
6,920 |
|
|
|
4,320 |
|
|
|
3,837 |
|
|
|
6,254 |
|
|
|
21,331 |
|
| Interest expense |
|
|
26,180 |
|
|
|
26,613 |
|
|
|
27,560 |
|
|
|
24,826 |
|
|
|
105,179 |
|
| Amortization of debt issuance
costs |
|
|
1,005 |
|
|
|
1,024 |
|
|
|
1,005 |
|
|
|
1,004 |
|
|
|
4,038 |
|
| Income from continuing
operations attributable to noncontrolling interest |
|
|
4,171 |
|
|
|
3,498 |
|
|
|
5,721 |
|
|
|
2,555 |
|
|
|
15,945 |
|
| Distributions paid - preferred
shares |
|
|
6,045 |
|
|
|
6,046 |
|
|
|
6,045 |
|
|
|
6,045 |
|
|
|
24,181 |
|
| Tax effect - impairment
expense |
|
|
— |
|
|
|
— |
|
|
|
4,308 |
|
|
|
(978 |
) |
|
|
3,330 |
|
| Non-controlling interest -
impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,382 |
|
|
|
5,382 |
|
| Other |
|
|
(1,160 |
) |
|
|
105 |
|
|
|
(1,045 |
) |
|
|
357 |
|
|
|
(1,743 |
) |
| Adjusted
EBITDA |
|
$ |
74,120 |
|
|
$ |
82,940 |
|
|
$ |
88,990 |
|
|
$ |
94,828 |
|
|
$ |
340,878 |
|
|
Compass Diversified Holdings |
|
Net Income (Loss) to Non-GAAP Adjusted Earnings and
Non-GAAP Adjusted EBITDA - 2022 |
|
(Unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended |
|
Year ended |
| (in thousands) |
|
March 31, 2022 |
|
June 30, 2022 |
|
September 30, 2022 |
|
December 31, 2022 |
|
December 31, 2022 |
|
Net income (loss) |
|
$ |
29,740 |
|
|
$ |
30,957 |
|
|
$ |
2,585 |
|
|
$ |
(11,844 |
) |
|
$ |
51,438 |
|
| Gain (loss) on sale of
discontinued operations, net of tax |
|
|
5,993 |
|
|
|
(579 |
) |
|
|
1,479 |
|
|
|
2,500 |
|
|
|
9,393 |
|
| Income from discontinued
operations, net of tax |
|
|
13,059 |
|
|
|
4,371 |
|
|
|
10,157 |
|
|
|
10,800 |
|
|
|
38,387 |
|
| Net income (loss) from
continuing operations |
|
$ |
10,688 |
|
|
$ |
27,165 |
|
|
$ |
(9,051 |
) |
|
$ |
(25,144 |
) |
|
$ |
3,658 |
|
| Less: income (loss) from
continuing operations attributable to noncontrolling interest |
|
|
4,388 |
|
|
|
3,813 |
|
|
|
3,297 |
|
|
|
(1,131 |
) |
|
|
10,367 |
|
| Net income (loss)
attributable to Holdings - continuing operations |
|
$ |
6,300 |
|
|
$ |
23,352 |
|
|
$ |
(12,348 |
) |
|
$ |
(24,013 |
) |
|
$ |
(6,709 |
) |
| Adjustments: |
|
|
|
|
|
|
|
|
|
|
| Distributions paid - preferred
shares |
|
|
(6,045 |
) |
|
|
(6,046 |
) |
|
|
(6,045 |
) |
|
|
(6,045 |
) |
|
|
(24,181 |
) |
| Amortization expense -
intangible assets and inventory step-up |
|
|
19,691 |
|
|
|
20,258 |
|
|
|
24,400 |
|
|
|
26,454 |
|
|
|
90,803 |
|
| Impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
20,552 |
|
|
|
20,552 |
|
| Tax effect - impairment
expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,557 |
) |
|
|
(3,557 |
) |
| Non-controlling interest -
impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,120 |
) |
|
|
(3,120 |
) |
| Loss on debt
extinguishment |
|
|
— |
|
|
|
— |
|
|
|
534 |
|
|
|
— |
|
|
|
534 |
|
| Non-controlling shareholder
compensation |
|
|
2,405 |
|
|
|
2,404 |
|
|
|
2,581 |
|
|
|
4,608 |
|
|
|
11,998 |
|
| Acquisition expense |
|
|
216 |
|
|
|
— |
|
|
|
5,902 |
|
|
|
— |
|
|
|
6,118 |
|
| Integration services fee |
|
|
563 |
|
|
|
563 |
|
|
|
1,625 |
|
|
|
1,312 |
|
|
|
4,063 |
|
| Corporate tax effect |
|
|
— |
|
|
|
(4,338 |
) |
|
|
16,457 |
|
|
|
— |
|
|
|
12,119 |
|
| Other |
|
|
— |
|
|
|
1,027 |
|
|
|
434 |
|
|
|
119 |
|
|
|
1,580 |
|
| Adjusted
earnings |
|
$ |
23,130 |
|
|
$ |
37,220 |
|
|
$ |
33,540 |
|
|
$ |
16,310 |
|
|
$ |
110,200 |
|
| Plus (less): |
|
|
|
|
|
|
|
|
|
|
| Depreciation expense |
|
|
9,450 |
|
|
|
9,741 |
|
|
|
10,149 |
|
|
|
10,690 |
|
|
|
40,030 |
|
| Income tax provision |
|
|
7,970 |
|
|
|
6,926 |
|
|
|
18,884 |
|
|
|
3,313 |
|
|
|
37,093 |
|
| Corporate tax effect |
|
|
— |
|
|
|
4,338 |
|
|
|
(16,457 |
) |
|
|
— |
|
|
|
(12,119 |
) |
| Tax effect - impairment
expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,557 |
|
|
|
3,557 |
|
| Non-controlling interest -
impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,120 |
|
|
|
3,120 |
|
| Interest expense |
|
|
17,419 |
|
|
|
17,509 |
|
|
|
22,796 |
|
|
|
25,768 |
|
|
|
83,492 |
|
| Amortization of debt issuance
costs |
|
|
866 |
|
|
|
865 |
|
|
|
1,004 |
|
|
|
1,005 |
|
|
|
3,740 |
|
| Income from continuing
operations attributable to noncontrolling interest |
|
|
4,388 |
|
|
|
3,813 |
|
|
|
3,297 |
|
|
|
(1,131 |
) |
|
|
10,367 |
|
| Distributions paid - preferred
shares |
|
|
6,045 |
|
|
|
6,046 |
|
|
|
6,045 |
|
|
|
6,045 |
|
|
|
24,181 |
|
| Other |
|
|
(226 |
) |
|
|
(718 |
) |
|
|
1,916 |
|
|
|
1,349 |
|
|
|
2,321 |
|
| Adjusted
EBITDA |
|
$ |
69,042 |
|
|
$ |
85,740 |
|
|
$ |
81,174 |
|
|
$ |
70,026 |
|
|
$ |
305,982 |
|
|
Compass Diversified Holdings |
|
Net Income (Loss) from Continuing Operations to Non-GAAP
Consolidated Adjusted EBITDA Reconciliation |
|
Three Months Ended December 31, 2023 |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
Corporate |
|
|
5.11 |
|
|
BOA |
|
Ergo |
|
Lugano |
|
PrimaLoft |
|
Velocity Outdoor |
|
Altor Solutions |
|
Arnold |
|
Sterno |
|
Consolidated |
|
Net income (loss) from continuing operations |
|
$ |
(10,847 |
) |
|
$ |
9,840 |
|
|
$ |
1,345 |
|
|
$ |
(1,487 |
) |
|
$ |
20,847 |
|
|
$ |
(64,383 |
) |
|
$ |
(3,183 |
) |
|
$ |
4,260 |
|
|
$ |
3,523 |
|
|
$ |
3,670 |
|
|
$ |
(36,415 |
) |
| Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes |
|
|
301 |
|
|
|
1,004 |
|
|
|
639 |
|
|
|
(37 |
) |
|
|
4,293 |
|
|
|
(2,549 |
) |
|
|
289 |
|
|
|
1,797 |
|
|
|
921 |
|
|
|
(406 |
) |
|
|
6,252 |
|
|
Interest expense, net |
|
|
24,732 |
|
|
|
(4 |
) |
|
|
(9 |
) |
|
|
— |
|
|
|
— |
|
|
|
(2 |
) |
|
|
120 |
|
|
|
— |
|
|
|
(11 |
) |
|
|
— |
|
|
|
24,826 |
|
|
Intercompany interest |
|
|
(35,402 |
) |
|
|
4,546 |
|
|
|
2,548 |
|
|
|
2,111 |
|
|
|
10,177 |
|
|
|
4,780 |
|
|
|
3,440 |
|
|
|
2,303 |
|
|
|
1,728 |
|
|
|
3,769 |
|
|
|
— |
|
|
Depreciation and amortization |
|
|
342 |
|
|
|
6,143 |
|
|
|
5,496 |
|
|
|
1,998 |
|
|
|
2,258 |
|
|
|
5,394 |
|
|
|
3,259 |
|
|
|
4,183 |
|
|
|
2,193 |
|
|
|
4,943 |
|
|
|
36,209 |
|
| EBITDA |
|
|
(20,874 |
) |
|
|
21,529 |
|
|
|
10,019 |
|
|
|
2,585 |
|
|
|
37,575 |
|
|
|
(56,760 |
) |
|
|
3,925 |
|
|
|
12,543 |
|
|
|
8,354 |
|
|
|
11,976 |
|
|
|
30,872 |
|
|
Other (income) expense |
|
|
— |
|
|
|
(412 |
) |
|
|
(19 |
) |
|
|
7 |
|
|
|
(75 |
) |
|
|
(66 |
) |
|
|
(31 |
) |
|
|
1,239 |
|
|
|
(4 |
) |
|
|
(280 |
) |
|
|
359 |
|
|
Non-controlling shareholder compensation |
|
|
— |
|
|
|
203 |
|
|
|
950 |
|
|
|
278 |
|
|
|
162 |
|
|
|
761 |
|
|
|
228 |
|
|
|
186 |
|
|
|
1 |
|
|
|
298 |
|
|
|
3,067 |
|
|
Impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
57,810 |
|
|
|
(978 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
56,832 |
|
|
Acquisition expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
321 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
321 |
|
|
Other |
|
|
— |
|
|
|
— |
|
|
|
3,072 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
305 |
|
|
|
3,377 |
|
| Adjusted
EBITDA |
|
$ |
(20,874 |
) |
|
$ |
21,320 |
|
|
$ |
14,022 |
|
|
$ |
3,191 |
|
|
$ |
37,662 |
|
|
$ |
1,745 |
|
|
$ |
3,144 |
|
|
$ |
13,968 |
|
|
$ |
8,351 |
|
|
$ |
12,299 |
|
|
$ |
94,828 |
|
|
Compass Diversified Holdings |
|
Net Income (Loss) from Continuing Operations to Non-GAAP
Consolidated Adjusted EBITDA Reconciliation |
|
Three Months Ended December 31, 2022 |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
Corporate |
|
|
5.11 |
|
|
BOA |
|
Ergo |
|
Lugano |
|
PrimaLoft |
|
Velocity Outdoor |
|
Altor Solutions |
|
Arnold |
|
Sterno |
|
Consolidated |
|
Net income (loss) from continuing operations |
|
$ |
(16,856 |
) |
|
$ |
7,093 |
|
|
$ |
5,491 |
|
|
$ |
(18,035 |
) |
|
$ |
6,063 |
|
|
$ |
(9,249 |
) |
|
$ |
(3,699 |
) |
|
$ |
2,513 |
|
|
$ |
466 |
|
|
$ |
1,069 |
|
|
$ |
(25,144 |
) |
| Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Provision (benefit) for income
taxes |
|
|
— |
|
|
|
2,126 |
|
|
|
(292 |
) |
|
|
(4,706 |
) |
|
|
6,026 |
|
|
|
(308 |
) |
|
|
(810 |
) |
|
|
267 |
|
|
|
561 |
|
|
|
449 |
|
|
|
3,313 |
|
| Interest expense, net |
|
|
25,684 |
|
|
|
(12 |
) |
|
|
(6 |
) |
|
|
8 |
|
|
|
4 |
|
|
|
(3 |
) |
|
|
87 |
|
|
|
— |
|
|
|
6 |
|
|
|
— |
|
|
|
25,768 |
|
| Intercompany interest |
|
|
(29,950 |
) |
|
|
4,260 |
|
|
|
1,776 |
|
|
|
2,026 |
|
|
|
4,932 |
|
|
|
4,261 |
|
|
|
3,295 |
|
|
|
2,898 |
|
|
|
1,571 |
|
|
|
4,931 |
|
|
|
— |
|
| Depreciation and
amortization |
|
|
342 |
|
|
|
6,168 |
|
|
|
5,648 |
|
|
|
2,033 |
|
|
|
3,148 |
|
|
|
6,271 |
|
|
|
3,393 |
|
|
|
4,149 |
|
|
|
1,976 |
|
|
|
5,021 |
|
|
|
38,149 |
|
| EBITDA |
|
|
(20,780 |
) |
|
|
19,635 |
|
|
|
12,617 |
|
|
|
(18,674 |
) |
|
|
20,173 |
|
|
|
972 |
|
|
|
2,266 |
|
|
|
9,827 |
|
|
|
4,580 |
|
|
|
11,470 |
|
|
|
42,086 |
|
| Other (income) expense |
|
|
15 |
|
|
|
(310 |
) |
|
|
545 |
|
|
|
2 |
|
|
|
— |
|
|
|
(148 |
) |
|
|
1,263 |
|
|
|
547 |
|
|
|
(20 |
) |
|
|
(545 |
) |
|
|
1,349 |
|
| Non-controlling shareholder
compensation |
|
|
— |
|
|
|
301 |
|
|
|
622 |
|
|
|
325 |
|
|
|
379 |
|
|
|
2,142 |
|
|
|
229 |
|
|
|
411 |
|
|
|
2 |
|
|
|
197 |
|
|
|
4,608 |
|
| Impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
20,552 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
20,552 |
|
| Integration services fee |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,313 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,313 |
|
| Other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
119 |
|
|
|
119 |
|
| Adjusted
EBITDA |
|
$ |
(20,765 |
) |
|
$ |
19,626 |
|
|
$ |
13,784 |
|
|
$ |
2,205 |
|
|
$ |
20,552 |
|
|
$ |
4,279 |
|
|
$ |
3,758 |
|
|
$ |
10,785 |
|
|
$ |
4,562 |
|
|
$ |
11,241 |
|
|
$ |
70,027 |
|
|
Compass Diversified Holdings |
|
Net Income (Loss) from Continuing Operations to Non-GAAP
Consolidated Adjusted EBITDA Reconciliation |
|
Year ended December 31, 2023 |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
Corporate |
|
|
5.11 |
|
|
BOA |
|
Ergo |
|
Lugano |
|
PrimaLoft |
|
Velocity Outdoor |
|
Altor Solutions |
|
Arnold |
|
Sterno |
|
Consolidated |
|
Net income (loss) from continuing operations |
|
$ |
(51,761 |
) |
|
$ |
21,690 |
|
|
$ |
16,496 |
|
|
$ |
(2,601 |
) |
|
$ |
52,315 |
|
|
$ |
(69,883 |
) |
|
$ |
(40,045 |
) |
|
$ |
16,504 |
|
|
$ |
10,434 |
|
|
$ |
8,115 |
|
|
$ |
(38,736 |
) |
| Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Provision (benefit) for income
taxes |
|
|
301 |
|
|
|
4,994 |
|
|
|
2,863 |
|
|
|
(1,309 |
) |
|
|
14,589 |
|
|
|
(5,672 |
) |
|
|
(5,616 |
) |
|
|
5,890 |
|
|
|
4,185 |
|
|
|
1,106 |
|
|
|
21,331 |
|
| Interest expense, net |
|
|
104,855 |
|
|
|
(8 |
) |
|
|
(18 |
) |
|
|
— |
|
|
|
4 |
|
|
|
(11 |
) |
|
|
352 |
|
|
|
— |
|
|
|
5 |
|
|
|
— |
|
|
|
105,179 |
|
| Intercompany interest |
|
|
(134,835 |
) |
|
|
20,244 |
|
|
|
7,580 |
|
|
|
8,595 |
|
|
|
32,837 |
|
|
|
18,123 |
|
|
|
13,510 |
|
|
|
10,486 |
|
|
|
6,806 |
|
|
|
16,654 |
|
|
|
— |
|
| Loss on debt
extinguishment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
| Depreciation and
amortization |
|
|
1,399 |
|
|
|
26,009 |
|
|
|
22,932 |
|
|
|
8,110 |
|
|
|
9,229 |
|
|
|
21,478 |
|
|
|
13,282 |
|
|
|
16,741 |
|
|
|
8,441 |
|
|
|
19,959 |
|
|
|
147,580 |
|
| EBITDA |
|
|
(80,041 |
) |
|
|
72,929 |
|
|
|
49,853 |
|
|
|
12,795 |
|
|
|
108,974 |
|
|
|
(35,965 |
) |
|
|
(18,517 |
) |
|
|
49,621 |
|
|
|
29,871 |
|
|
|
45,834 |
|
|
|
235,354 |
|
| Other (income) expense |
|
|
(128 |
) |
|
|
(515 |
) |
|
|
98 |
|
|
|
36 |
|
|
|
(80 |
) |
|
|
62 |
|
|
|
(1,210 |
) |
|
|
1,440 |
|
|
|
(5 |
) |
|
|
(1,441 |
) |
|
|
(1,743 |
) |
| Non-controlling shareholder
compensation |
|
|
— |
|
|
|
1,191 |
|
|
|
3,019 |
|
|
|
1,214 |
|
|
|
1,474 |
|
|
|
980 |
|
|
|
914 |
|
|
|
986 |
|
|
|
27 |
|
|
|
860 |
|
|
|
10,665 |
|
| Impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
57,810 |
|
|
|
31,590 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
89,400 |
|
| Acquisition expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
321 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
321 |
|
| Integration services fee |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,375 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,375 |
|
| Other |
|
|
— |
|
|
|
— |
|
|
|
3,072 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,434 |
|
|
|
4,506 |
|
| Adjusted
EBITDA |
|
$ |
(80,169 |
) |
|
$ |
73,605 |
|
|
$ |
56,042 |
|
|
$ |
14,366 |
|
|
$ |
110,368 |
|
|
$ |
25,262 |
|
|
$ |
12,777 |
|
|
$ |
52,047 |
|
|
$ |
29,893 |
|
|
$ |
46,687 |
|
|
$ |
340,878 |
|
|
Compass Diversified Holdings |
|
Net Income (Loss) from Continuing Operations to Non-GAAP
Consolidated Adjusted EBITDA Reconciliation |
|
Year ended December 31, 2022 |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
Corporate |
|
|
5.11 |
|
|
BOA |
|
Ergo |
|
Lugano |
|
PrimaLoft |
|
Velocity Outdoor |
|
Altor Solutions |
|
Arnold |
|
Sterno |
|
Consolidated |
|
Net income (loss) from continuing operations |
|
$ |
(77,990 |
) |
|
$ |
22,633 |
|
|
$ |
42,613 |
|
|
$ |
(18,669 |
) |
|
$ |
27,934 |
|
|
$ |
(17,741 |
) |
|
$ |
4,127 |
|
|
$ |
9,662 |
|
|
$ |
7,683 |
|
|
$ |
3,406 |
|
|
$ |
3,658 |
|
| Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Provision (benefit) for income
taxes |
|
|
12,119 |
|
|
|
7,125 |
|
|
|
6,527 |
|
|
|
(4,274 |
) |
|
|
11,889 |
|
|
|
(3,878 |
) |
|
|
1,562 |
|
|
|
3,174 |
|
|
|
3,329 |
|
|
|
(480 |
) |
|
|
37,093 |
|
| Interest expense, net |
|
|
83,243 |
|
|
|
— |
|
|
|
(25 |
) |
|
|
10 |
|
|
|
16 |
|
|
|
(7 |
) |
|
|
229 |
|
|
|
— |
|
|
|
26 |
|
|
|
— |
|
|
|
83,492 |
|
| Intercompany interest |
|
|
(92,177 |
) |
|
|
13,761 |
|
|
|
7,410 |
|
|
|
6,026 |
|
|
|
12,773 |
|
|
|
7,512 |
|
|
|
10,282 |
|
|
|
10,742 |
|
|
|
5,518 |
|
|
|
18,153 |
|
|
|
— |
|
| Loss on debt
extinguishment |
|
|
534 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
534 |
|
| Depreciation and
amortization |
|
|
1,405 |
|
|
|
22,972 |
|
|
|
21,993 |
|
|
|
8,094 |
|
|
|
11,533 |
|
|
|
10,465 |
|
|
|
13,374 |
|
|
|
16,403 |
|
|
|
8,041 |
|
|
|
20,293 |
|
|
|
134,573 |
|
| EBITDA |
|
|
(72,866 |
) |
|
|
66,491 |
|
|
|
78,518 |
|
|
|
(8,813 |
) |
|
|
64,145 |
|
|
|
(3,649 |
) |
|
|
29,574 |
|
|
|
39,981 |
|
|
|
24,597 |
|
|
|
41,372 |
|
|
|
259,350 |
|
| Other (income) expense |
|
|
(58 |
) |
|
|
(217 |
) |
|
|
1,043 |
|
|
|
6 |
|
|
|
2 |
|
|
|
112 |
|
|
|
2,417 |
|
|
|
766 |
|
|
|
(20 |
) |
|
|
(1,730 |
) |
|
|
2,321 |
|
| Non-controlling shareholder
compensation |
|
|
— |
|
|
|
1,511 |
|
|
|
2,511 |
|
|
|
1,479 |
|
|
|
1,179 |
|
|
|
2,142 |
|
|
|
971 |
|
|
|
1,321 |
|
|
|
40 |
|
|
|
844 |
|
|
|
11,998 |
|
| Impairment expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
20,552 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
20,552 |
|
| Acquisition expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,680 |
|
|
|
222 |
|
|
|
216 |
|
|
|
— |
|
|
|
— |
|
|
|
6,118 |
|
| Integration services fee |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,688 |
|
|
|
2,375 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,063 |
|
| Other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
250 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,330 |
|
|
|
1,580 |
|
| Adjusted
EBITDA |
|
$ |
(72,924 |
) |
|
$ |
67,785 |
|
|
$ |
82,072 |
|
|
$ |
13,474 |
|
|
$ |
67,014 |
|
|
$ |
6,660 |
|
|
$ |
33,184 |
|
|
$ |
42,284 |
|
|
$ |
24,617 |
|
|
$ |
41,816 |
|
|
$ |
305,982 |
|
|
Compass Diversified Holdings |
|
Adjusted EBITDA |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
Year ended December 31, |
|
(in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| |
|
|
|
|
|
|
|
|
| Branded
Consumer |
|
|
|
|
|
|
|
|
| 5.11 |
|
$ |
21,320 |
|
|
$ |
19,626 |
|
|
$ |
73,605 |
|
|
$ |
67,785 |
|
| BOA |
|
|
14,022 |
|
|
|
13,784 |
|
|
|
56,042 |
|
|
|
82,072 |
|
| Ergobaby |
|
|
3,191 |
|
|
|
2,205 |
|
|
|
14,366 |
|
|
|
13,474 |
|
| Lugano |
|
|
37,662 |
|
|
|
20,552 |
|
|
|
110,368 |
|
|
|
67,014 |
|
|
PrimaLoft (1) |
|
|
1,745 |
|
|
|
4,279 |
|
|
|
25,262 |
|
|
|
6,660 |
|
| Velocity Outdoor |
|
|
3,144 |
|
|
|
3,758 |
|
|
|
12,777 |
|
|
|
33,184 |
|
| Total Branded
Consumer |
|
$ |
81,084 |
|
|
$ |
64,204 |
|
|
$ |
292,420 |
|
|
$ |
270,189 |
|
| |
|
|
|
|
|
|
|
|
|
Industrial |
|
|
|
|
|
|
|
|
| Altor Solutions |
|
$ |
13,968 |
|
|
$ |
10,785 |
|
|
$ |
52,047 |
|
|
$ |
42,284 |
|
| Arnold Magnetics |
|
|
8,351 |
|
|
|
4,562 |
|
|
|
29,893 |
|
|
|
24,617 |
|
| Sterno |
|
|
12,299 |
|
|
|
11,241 |
|
|
|
46,687 |
|
|
|
41,816 |
|
| Total
Industrial |
|
$ |
34,618 |
|
|
$ |
26,588 |
|
|
$ |
128,627 |
|
|
$ |
108,717 |
|
| Corporate expense |
|
|
(20,874 |
) |
|
|
(20,765 |
) |
|
|
(80,169 |
) |
|
|
(72,924 |
) |
| Total Adjusted
EBITDA |
|
$ |
94,828 |
|
|
$ |
70,027 |
|
|
$ |
340,878 |
|
|
$ |
305,982 |
|
| |
|
(1) The above results for PrimaLoft do not
include management's estimate of Adjusted EBITDA, before our
ownership, of $24.3 million for the twelve months ended December
31, 2022. PrimaLoft was acquired on July 12, 2022. |
|
Compass Diversified Holdings |
|
Net Sales to Pro Forma Net Sales
Reconciliation |
|
(unaudited) |
| |
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
Year ended December 31, |
|
(in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| |
|
|
|
|
|
|
|
|
| Net Sales |
|
$ |
566,989 |
|
|
$ |
529,682 |
|
|
$ |
2,058,876 |
|
|
$ |
2,009,130 |
|
|
Acquisitions (1) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
55,185 |
|
| Pro Forma Net Sales |
|
$ |
566,989 |
|
|
$ |
529,682 |
|
|
$ |
2,058,876 |
|
|
$ |
2,064,315 |
|
| |
|
(1) Acquisitions reflects the net sales for
PrimaLoft on a proforma basis as if we had acquired this business
on January 1, 2022. |
|
Compass Diversified Holdings |
|
Subsidiary Pro Forma Net Sales |
|
(unaudited) |
| |
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
Year ended December 31, |
|
(in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| |
|
|
|
|
|
|
|
|
| Branded
Consumer |
|
|
|
|
|
|
|
|
| 5.11 |
|
$ |
147,394 |
|
|
$ |
135,605 |
|
|
$ |
533,089 |
|
|
$ |
486,213 |
|
| BOA |
|
|
42,435 |
|
|
|
42,473 |
|
|
|
155,825 |
|
|
|
208,688 |
|
| Ergobaby |
|
|
22,074 |
|
|
|
20,179 |
|
|
|
93,859 |
|
|
|
88,435 |
|
| Lugano |
|
|
104,750 |
|
|
|
64,278 |
|
|
|
308,321 |
|
|
|
201,507 |
|
|
PrimaLoft (1) |
|
|
9,434 |
|
|
|
14,032 |
|
|
|
67,053 |
|
|
|
79,929 |
|
| Velocity Outdoor |
|
|
45,842 |
|
|
|
51,464 |
|
|
|
172,190 |
|
|
|
232,238 |
|
| Total Branded Consumer |
|
$ |
371,929 |
|
|
$ |
328,031 |
|
|
$ |
1,330,337 |
|
|
$ |
1,297,010 |
|
| |
|
|
|
|
|
|
|
|
|
Industrial |
|
|
|
|
|
|
|
|
| Altor Solutions |
|
|
56,417 |
|
|
|
61,748 |
|
|
|
238,030 |
|
|
|
261,338 |
|
| Arnold Magnetics |
|
|
44,632 |
|
|
|
37,496 |
|
|
|
166,679 |
|
|
|
153,815 |
|
| Sterno |
|
|
94,011 |
|
|
|
102,407 |
|
|
|
323,830 |
|
|
|
352,152 |
|
| Total Industrial |
|
$ |
195,060 |
|
|
$ |
201,651 |
|
|
$ |
728,539 |
|
|
$ |
767,305 |
|
| |
|
|
|
|
|
|
|
|
| Total Subsidiary Net
Sales |
|
$ |
566,989 |
|
|
$ |
529,682 |
|
|
$ |
2,058,876 |
|
|
$ |
2,064,315 |
|
| |
|
(1) Net sales for PrimaLoft are pro forma as
if we had acquired this business on January 1, 2022. Historical net
sales for PrimaLoft prior to acquisition on July 12, 2022, were
$55.2 million for the twelve months ended December 31, 2022. |
|
Compass Diversified Holdings |
|
Condensed Consolidated Cash Flows |
| |
|
|
|
|
| |
|
Three months ended December 31, |
|
Year ended December 31, |
|
(in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| |
|
|
|
|
|
|
|
|
| Net cash provided by
(used in) operating activities |
|
$ |
21,128 |
|
|
$ |
11,632 |
|
|
$ |
78,080 |
|
|
$ |
(28,291 |
) |
| Net cash provided by
(used in) investing activities |
|
|
466,213 |
|
|
|
(27,774 |
) |
|
|
570,503 |
|
|
|
(626,725 |
) |
| Net cash provided by
(used in) financing activities |
|
|
(102,236 |
) |
|
|
14,757 |
|
|
|
(260,163 |
) |
|
|
556,885 |
|
| Foreign currency impact on
cash |
|
|
636 |
|
|
|
1,404 |
|
|
|
786 |
|
|
|
(1,331 |
) |
| Net increase (decrease) in
cash and cash equivalents |
|
|
385,741 |
|
|
|
19 |
|
|
|
389,206 |
|
|
|
(99,462 |
) |
| Cash and cash equivalents -
beginning of the period (1) |
|
|
64,736 |
|
|
|
61,252 |
|
|
|
61,271 |
|
|
|
160,733 |
|
| Cash and cash
equivalents - end of the period |
|
$ |
450,477 |
|
|
$ |
61,271 |
|
|
$ |
450,477 |
|
|
$ |
61,271 |
|
| |
|
(1) Includes cash from discontinued
operations of $4.7 million at January 1, 2023 and $3.6 million at
January 1, 2022. |
|
Compass Diversified Holding |
|
Selected Financial Data - Cash Flows |
| |
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
Year ended December 31, |
|
(in thousands) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| |
|
|
|
|
|
|
|
|
| Changes in operating assets
and liabilities |
|
$ |
(24,390 |
) |
|
$ |
(27,722 |
) |
|
$ |
(153,310 |
) |
|
$ |
(224,587 |
) |
| Purchases of property and
equipment |
|
$ |
(17,239 |
) |
|
$ |
(23,726 |
) |
|
$ |
(55,776 |
) |
|
$ |
(60,989 |
) |
| Distributions paid - common
shares |
|
$ |
(17,955 |
) |
|
$ |
(18,051 |
) |
|
$ |
(71,967 |
) |
|
$ |
(70,845 |
) |
| Distributions paid - preferred
shares |
|
$ |
(6,045 |
) |
|
$ |
(6,045 |
) |
|
$ |
(24,181 |
) |
|
$ |
(24,181 |
) |
Compass Diversified (NYSE:CODI)
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From Mar 2024 to Apr 2024
Compass Diversified (NYSE:CODI)
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From Apr 2023 to Apr 2024
