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Sep 30, 2020
Turning Point Brands Q3 2020 Earnings Report
Turning Point Brands experienced growth across key segments and increased financial outlook.
Key Takeaways
Turning Point Brands reported a 7.6% increase in net sales to $104.2 million for the third quarter of 2020. The company's gross profit increased by 12.8% to $48.3 million, and net income rose to $7.8 million despite PMTA costs. Adjusted EBITDA increased by 27.4% to $23.9 million, and the company has raised its outlook for the remainder of the fiscal year.
Net sales increased 7.6% to $104.2 million.
Gross profit increased 12.8% to $48.3 million.
Net income increased $1.5 million to $7.8 million.
Adjusted EBITDA increased 27.4% to $23.9 million.
Revenue by Segment
Forward Guidance
The company projects 2020 net sales to be $395 to $401 million and 2020 Adjusted EBITDA of $87 million to $90 million.
Positive Outlook
- 2020 net sales to be $395 to $401 million
- 2020 Adjusted EBITDA of $87 million to $90 million
- Stock compensation and non-cash incentive expense in 2020 is projected to be $2.8 million
- The company spent a total of $16.6 million on the PMTA process
- Capital expenditures for 2020 are anticipated to be approximately $6 million
Challenges Ahead
- expected near-term volatility within our NewGen segment
- Cash interest expense is projected to be $12 million
- GAAP interest expense includes $7 million of debt discount amortization equal to the fair value of the equity components over the expected life of the 2024 convertible notes
- The company expects the 2020 effective income tax rate to be 23% to 24%
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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