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Jun 30, 2024
Hydrofarm Q2 2024 Earnings Report
Hydrofarm's financial performance reflected the effectiveness of restructuring plans and cost-saving efforts, despite a decrease in net sales.
Key Takeaways
Hydrofarm Holdings Group reported a decrease in net sales to $54.8 million, but delivered positive Adjusted EBITDA for the fourth time in the last five quarters. The company is reaffirming its full year 2024 outlook on its key metrics.
Net sales decreased to $54.8 million compared to $63.1 million.
Gross Profit Margin decreased to 19.8% compared to 23.0%.
Adjusted EBITDA decreased to $1.7 million compared to $2.5 million.
Cash from operating activities and Free Cash Flow were $3.8 million and $3.4 million, respectively.
Hydrofarm
Hydrofarm
Forward Guidance
The Company is reaffirming its full year 2024 outlook on its key metrics: Net sales to decrease low to high teens in percentage terms, Adjusted EBITDA that is positive and Free Cash Flow that is positive.
Positive Outlook
- Improved year-over-year Adjusted Gross Profit Margin resulting primarily from cost savings associated with restructuring actions and related productivity initiatives.
- Improved year-over-year Adjusted Gross Profit Margin resulting primarily from an expectation of minimal non-restructuring inventory reserves or related charges.
- Reduced year-over-year Adjusted SG&A expense resulting primarily from full year benefit of headcount reductions completed in 2023.
- Reduced year-over-year Adjusted SG&A expense resulting primarily from reductions in professional fees, facilities and insurance expenses.
- Reduction in inventory and net working capital helping to generate positive Free Cash Flow for the full year.