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Dec 31, 2024
Karat Packaging Q4 2024 Earnings Report
Karat Packaging reported solid revenue growth and improved profitability in Q4 2024.
Key Takeaways
Karat Packaging posted net sales of $101.6 million, a 6.3% increase year-over-year. Adjusted EBITDA rose to $11.3 million, representing an adjusted EBITDA margin of 11.1%. Net income improved significantly by 40.3% to $5.9 million. The company continues to expand its eco-friendly product lines, which contributed 35% of total sales.
Total revenue increased 6.3% YoY to $101.6 million.
Adjusted EBITDA rose to $11.3 million, up from $8.6 million in Q4 2023.
Net income grew 40.3% to $5.9 million, with an improved net income margin of 5.8%.
Eco-friendly products accounted for 35% of total sales, with an 11% YoY growth.
Revenue by Segment
Forward Guidance
Karat Packaging expects continued revenue growth in 2025, driven by strong demand for eco-friendly products and strategic pricing adjustments.
Positive Outlook
- Projected net sales increase of 6-8% in Q1 2025.
- Full-year 2025 revenue expected to grow between 9-11%.
- Gross margin for Q1 2025 forecasted between 37-39%.
- Ongoing efforts to diversify sourcing and reduce dependence on China.
- Expansion of distribution capacity with a new 187,000 square-foot center.
Challenges Ahead
- Tariff uncertainty may impact product sourcing costs.
- Potential margin pressure due to increased labor and shipping expenses.
- Competitive pricing environment in the distributor channel.
- Ongoing capital expenditures for warehouse expansion could impact cash flow.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
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