Snap One Holdings Corp. (Nasdaq: SNPO)
(“Snap One,” the “Company,” “we,” or “our”), a provider of
smart living products, services, and software to professional
integrators, reported financial results for the fiscal first
quarter ended March 31, 2023.
Fiscal First Quarter 2023 and Recent Operational
Highlights
- Continued investment to maintain a
clear leadership position in the professionally
installed smart living industry
- Awarded 14 2023 CE Pro ‘Quest for
Quality’ awards across 22 categories included in its survey of
professional integrators, reflecting the Company’s service
excellence
- Delivered on new product
innovation and enhanced software platform
capabilities
- Launched exciting new solutions
across outdoor audio and lighting, control, surveillance, and
networking
- Received two ‘Mark of Excellence’
awards at the 2023 Consumer Electronics Show
- Expanded local branch presence with the
opening of a Fort Myers, FL location, bringing the total number to
41 North American branches at the end of the quarter
Management Commentary“Our team navigated an
uncertain environment, including channel inventory destocking
headwinds, and delivered improved bottom-line results, highlighting
the resiliency of our business model and the integrator partners we
serve,” said Snap One CEO John Heyman. “We remain focused on
executing controllable strategies to grow our share of wallet with
existing integrator partners and to drive expanded profitability.
During the period, we took several meaningful steps in support of
this plan including launching numerous exciting new products,
opening an additional domestic branch, completing a strategic sales
team optimization, and executing targeted marketing programs. We
have also driven significant contribution margin rate expansion due
to the cumulative impact of our price adjustments enacted in
response to supply chain and input cost inflation, which has begun
to ease. We remain on track with our operating margin expansion
plan for the year.”
Fiscal First Quarter 2023 Financial
ResultsResults compare 2023 fiscal first quarter end
(March 31, 2023) to 2022 fiscal first quarter end (April 1, 2022)
unless otherwise indicated. The Company’s fiscal first quarter in
both years reflects a 13-week period. Results are presented on an
as reported basis, unless otherwise indicated.
- Net sales decreased 9.2% to $252.0
million from $277.4 million in the comparable year-ago period,
primarily attributable to channel inventory destocking
headwinds.
- Selling, general and administrative
(SG&A) expenses increased 8.4% to $93.8 million (37.2% of net
sales) from $86.5 million (31.2% of net sales) in the comparable
year-ago period. As a percentage of net sales, SG&A increased
due to a lower net sales base in the period compared to the
year-ago period as well as due to increases in fair value
adjustment to contingent value rights, equity-based compensation,
and severance cost.
- Net loss increased to $14.5 million
(-5.8% of net sales) compared to net loss of $2.3 million (-0.8% of
net sales) in the comparable year-ago period.
- Contribution margin, a non-GAAP
measurement of operating performance reconciled below, increased
1.1% to $106.2 million (42.1% of net sales) from $105.1 million
(37.9% of net sales) in the comparable year-ago period.
- Adjusted EBITDA, a non-GAAP
measurement of operating performance reconciled below, decreased
3.9% to $22.7 million (9.0% of net sales) compared to $23.6 million
(8.5% of net sales) in the comparable year-ago period.
- Adjusted net income, a non-GAAP
measurement of operating performance reconciled below, decreased to
$3.4 million (1.3% of net sales) from $10.7 million (3.9% of net
sales) in the comparable year-ago period.
- Net cash used in operating
activities totaled $2.6 million, compared to net cash used in
operating activities of $23.0 million in the comparable year-ago
period.
- As of March 31, 2023, cash and cash
equivalents were $34.5 million, compared to $21.1 million at the
end of fiscal year 2022.
- Free cash flow, a non-GAAP measurement of operating performance
reconciled below, totaled $(11.8) million, compared to $(26.3)
million in the comparable year-ago period.
Stock Repurchase ProgramAs of March 31, 2023,
Snap One had repurchased 296,467 shares of its common stock for an
aggregate amount of $3.1 million pursuant to the Company’s $25
million stock repurchase program authorization through the end of
2023.
Fiscal 2023 Financial Outlook“Our full year
2023 outlook remains solid as we seek to move past the channel
inventory destocking headwind, drive operating margin expansion,
and enhance our liquidity position,” Heyman continued. “We are
maintaining a pragmatic view of topline performance given the
persistent macroeconomic uncertainty and channel inventory
destocking headwind in the short-term. However, our recent
performance provides us with improved visibility into our
profitability outlook.”
“With these factors in mind, we are tightening our full-year net
sales and increasing our full-year adjusted EBITDA guidance ranges
from our previously published outlook. We now expect our net sales
in fiscal year ending December 29, 2023 to range between $1.06
billion and $1.09 billion. For fiscal 2023, we expect adjusted
EBITDA1 to range between $110 million and $118 million which
represents a 20 basis point improvement in adjusted EBITDA margin
relative to our prior guidance. Overall, we remain confident in our
2023 outlook and the long-term opportunity for Snap One.”
Supplemental Earnings PresentationThe Company
has posted a supplemental earnings presentation accompanying its
fiscal first quarter 2023 results to the Events & Presentations
section of its Investor Relations website, which can be found at
investors.snapone.com.
Conference CallSnap One management will hold a
conference call today, May 9, 2023 at 4:30 p.m. Eastern Time (1:30
p.m. Pacific Time) to discuss these results.
Company CEO John Heyman and CFO Mike Carlet will host the call,
followed by a question-and-answer period.
Registration Link: Click here
to register
Please register online at least 10 minutes prior to the start
time. If you have any difficulty with registration or connecting to
the conference call, please contact Gateway Investor Relations at
949-574-3860.
The conference call will be broadcast live and available for
replay here and via the Investor Relations section of Snap One's
website.
About Snap OneAs a leading distributor of smart
living technology, Snap One empowers its vast network of
professional integrators to deliver entertainment, connectivity,
automation, and security solutions to residential and commercial
end users worldwide. Snap One distributes an expansive portfolio of
proprietary and third-party products through its intuitive online
portal and local branch network, blending the benefits of
e-commerce with the convenience of same-day pickup. The Company
provides software, award-winning support, and digital workflow
tools to help its integrator partners build thriving and profitable
businesses. Additional information about Snap One can be found
at snapone.com.
Snap One intends to use its website as a means of disclosing
material, non-public information and for complying with its
disclosure obligations under Regulation FD. Such disclosures will
be included in the Investor Relations section of the Snap One
website at investors.snapone.com. Accordingly, investors should
monitor such portion of the website, in addition to following the
Company’s press releases, Securities and Exchange Commission
(“SEC”) filings and public conference calls and webcasts.
Non-GAAP Financial MeasuresIn addition to the
financial measures prepared in accordance with generally accepted
accounting principles in the United States (“GAAP”), this press
release contains certain non-GAAP financial measures, including
contribution margin, adjusted EBITDA, adjusted net income, and free
cash flow. A non-GAAP financial measure is generally defined as a
numerical measure of a company’s financial or operating performance
that excludes or includes amounts so as to be different than the
most directly comparable measure calculated and presented in
accordance with GAAP. We use the following non-GAAP measures to
help us monitor the performance of our business, measure our
performance, identify trends affecting our business and assist us
in making strategic decisions:
Contribution margin, which is defined as net sales less cost of
sales, exclusive of depreciation and amortization, divided by net
sales.
Adjusted EBITDA, which is defined as net loss, plus interest
expense, income tax benefit, depreciation and amortization, other
expense (income), net further adjusted to exclude equity-based
compensation, acquisition- and integration-related costs and
certain other non-recurring, non-core, infrequent or unusual
charges as set forth in the reconciliation in this section
below.
Adjusted net income, which is defined as net loss plus
amortization further adjusted to exclude equity-based compensation,
acquisition- and integration-related costs, IPO cost, expense
related to interest rate cap and certain non-recurring, non-core,
infrequent or unusual charges, including the estimated tax impacts
of these adjustments as set forth in the reconciliation in this
section below.
Free cash flow, which is defined as net cash (used in) provided
by operating activities less capital expenditures (which consist of
purchases of property and equipment as well as purchases of
information technology, software development and leasehold
improvements).
Contribution margin, adjusted EBITDA, adjusted net income and
free cash flow are key measures used by management to understand
and evaluate our financial performance, trends and generate future
operating plans, make strategic decisions regarding the allocation
of capital, and analyze investments in initiatives that are focused
on cultivating new markets for our products and services. We
believe contribution margin, adjusted EBITDA, adjusted net income
and free cash flow are useful measurements for analysts, investors,
and other interested parties to evaluate companies in our markets
as they help identify underlying trends that could otherwise be
masked by certain expenses that we do not consider indicative of
our ongoing performance.
Contribution margin, adjusted EBITDA, adjusted net income and
free cash flow have limitations as analytical tools. These measures
are not calculated in accordance with GAAP and should not be
considered in isolation from, or as a substitute for, financial
information prepared in accordance with GAAP. In addition,
contribution margin, adjusted EBITDA, adjusted net income and free
cash flow may not be comparable to similarly titled metrics of
other companies due to differences among the methods of
calculation.
Cautionary Statements Concerning Forward-Looking
StatementsCertain statements contained in this press
release constitute forward-looking statements within the meaning of
the “safe harbor” provisions of the Private Securities Litigation
Reform Act of 1995, as amended, which reflect our current views
with respect to, among other things, our operations, earnings and
financial performance, including our guidance for 2023. You can
identify these forward-looking statements by the use of words such
as “outlook,” “indicator,” “believes,” “project,” “forecast,”
“targets,” “expects,” “potential,” “continues,” “may,” “will,”
“should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,”
“scheduled,” “estimates,” “anticipates” or the negative version of
these words or other comparable words. Such forward-looking
statements are subject to various risks and uncertainties.
Accordingly, there are or will be important factors that could
cause actual outcomes or results to differ materially from those
indicated in these statements. We believe these factors include but
are not limited to the risks related to our business and industry,
risks related to our products, risks related to our manufacturing
and supply chain, risks related to our distribution channels, risks
related to laws and regulations, risks related to cybersecurity and
privacy, risks related to intellectual property, risks related to
our international operations, risks related to our indebtedness,
risks related to interest rate and exchange rate volatility, risks
related to our financial statements, risks related to our common
stock, and other risks as described under the section entitled
“Risk Factors” in our latest Annual Report on Form 10-K filed with
the SEC, as such factors may be updated from time to time in our
periodic filings with the SEC, which are accessible on the SEC’s
website at www.sec.gov. These factors should not be construed as
exhaustive and should be read in conjunction with the other
cautionary statements that are included in this report and in our
other periodic filings. The forward-looking statements speak only
as of the date of this report, and, except as required by law, we
undertake no obligation to publicly update or review any
forward-looking statement, whether as a result of new information,
future developments or otherwise.
Contacts
Media:Danielle KarrDirector, Public Relations
& EventsDanielle.Karr@SnapOne.com
Investors:Tom Colton and Matt GloverGateway Investor
Relations949-574-3860IR@SnapOne.com
-Financial Tables to Follow-
Snap One Holdings Corp. and
SubsidiariesCondensed Consolidated Statements of
Operations (unaudited, in thousands, except per
share amounts)
|
Three Months Ended |
|
|
March 31, |
|
|
|
April 1, |
|
|
2023 |
|
|
|
2022 |
|
Net sales |
$ |
252,040 |
|
|
$ |
277,434 |
|
Costs and
expenses: |
|
|
|
Cost of sales, exclusive of depreciation and amortization |
145,813 |
|
|
172,332 |
|
Selling, general and administrative expenses |
93,797 |
|
|
86,527 |
|
Depreciation and amortization |
15,202 |
|
|
14,889 |
|
Total costs and expenses |
254,812 |
|
|
273,748 |
|
Income
(loss) from operations |
(2,772 |
) |
|
3,686 |
|
Other
expenses (income): |
|
|
|
Interest expense |
13,949 |
|
|
6,723 |
|
Other expense (income), net |
827 |
|
|
(420 |
) |
Total other expenses |
14,776 |
|
|
6,303 |
|
Loss before
income taxes |
(17,548 |
) |
|
(2,617 |
) |
Income tax
benefit |
(3,000 |
) |
|
(361 |
) |
Net
loss |
(14,548 |
) |
|
(2,256 |
) |
Net loss
attributable to noncontrolling interest |
— |
|
|
(20 |
) |
Net loss
attributable to Company |
$ |
(14,548 |
) |
|
$ |
(2,236 |
) |
|
|
|
|
Net loss per
share, basic and diluted |
$ |
(0.19 |
) |
|
$ |
(0.03 |
) |
Weighted
average shares outstanding, basic and diluted |
75,291 |
|
|
74,464 |
|
|
|
|
|
|
|
Snap One Holdings Corp. and
SubsidiariesCondensed Consolidated Balance
Sheets(unaudited, in thousands, except par
value)
|
As of |
|
March 31, 2023 |
|
December 30, 2022 |
Assets |
|
|
|
Current
assets: |
|
|
|
Cash and cash equivalents |
$ |
34,452 |
|
|
$ |
21,117 |
|
Accounts receivable, net |
50,415 |
|
|
48,174 |
|
Inventories |
313,555 |
|
|
314,588 |
|
Prepaid expenses |
23,042 |
|
|
22,913 |
|
Other current assets |
|
3,771 |
|
|
|
5,930 |
|
Total current assets |
425,235 |
|
|
412,722 |
|
Long-term
assets: |
|
|
|
Property and equipment, net |
41,426 |
|
|
34,958 |
|
Goodwill |
592,195 |
|
|
592,186 |
|
Other intangible assets, net |
541,996 |
|
|
554,419 |
|
Operating lease right-of-use assets |
51,541 |
|
|
54,041 |
|
Other assets |
4,949 |
|
|
4,195 |
|
Total
assets |
$ |
1,657,342 |
|
|
$ |
1,652,521 |
|
Liabilities and stockholders' equity |
|
|
|
Current
liabilities: |
|
|
|
Current maturities of long-term debt |
$ |
5,200 |
|
|
$ |
5,063 |
|
Accounts payable |
66,704 |
|
|
77,443 |
|
Accrued liabilities |
64,255 |
|
|
64,605 |
|
Current operating lease liability |
9,964 |
|
|
10,574 |
|
Current tax receivable agreement liability |
23,195 |
|
|
10,191 |
|
Total current liabilities |
169,318 |
|
|
167,876 |
|
Long-term
liabilities: |
|
|
|
Revolving credit facility, net |
48,876 |
|
|
10,800 |
|
Long-term debt, net of current portion |
496,054 |
|
|
496,795 |
|
Deferred income tax liabilities, net |
37,670 |
|
|
43,515 |
|
Operating lease liability, net of current portion |
52,195 |
|
|
50,896 |
|
Tax receivable agreement liability, net of current portion |
78,211 |
|
|
101,262 |
|
Other liabilities |
25,641 |
|
|
24,206 |
|
Total liabilities |
907,965 |
|
|
895,350 |
|
Commitments
and contingencies (Note 14) |
|
|
|
Stockholders' equity: |
|
|
|
Common stock, $0.01 par value, 500,000 shares authorized; 75,252
shares issued and outstanding as of March 31, 2023 and 75,042
shares issued and outstanding at December 30, 2022 |
752 |
|
|
750 |
|
Preferred stock, $0.01 par value; 50,000 shares authorized, no
shares issued and outstanding |
— |
|
|
— |
|
Additional paid-in capital |
855,202 |
|
|
848,703 |
|
Accumulated deficit |
(102,594 |
) |
|
(88,046 |
) |
Accumulated other comprehensive loss |
(3,983 |
) |
|
(4,236 |
) |
Total stockholders’ equity |
749,377 |
|
|
757,171 |
|
Total
liabilities and stockholders’ equity |
$ |
1,657,342 |
|
|
$ |
1,652,521 |
|
|
|
|
|
|
|
Snap One Holdings Corp. and
SubsidiariesCondensed Consolidated Statements of
Cash Flows(unaudited, in thousands)
|
Three Months Ended |
|
March 31, 2023 |
|
April 1, 2022 |
Cash
flows from operating activities: |
|
|
|
Net loss |
$ |
(14,548 |
) |
|
$ |
(2,256 |
) |
Adjustments
to reconcile net loss to net cash from operating activities: |
|
|
|
|
|
Depreciation and amortization |
|
15,202 |
|
|
|
14,889 |
|
Amortization of debt issuance costs |
|
772 |
|
|
|
458 |
|
Unrealized loss on interest rate cap |
|
818 |
|
|
|
— |
|
Deferred income taxes |
|
(5,869 |
) |
|
|
(2,965 |
) |
Equity-based compensation |
|
7,763 |
|
|
|
5,599 |
|
Non-cash operating lease expense |
|
3,310 |
|
|
|
2,985 |
|
Bad debt expense |
|
307 |
|
|
|
74 |
|
Fair value adjustment to contingent value rights |
|
600 |
|
|
|
(2,800 |
) |
Valuation adjustment to TRA liability |
|
144 |
|
|
|
— |
|
Other, net |
|
130 |
|
|
|
— |
|
Change in operating assets and liabilities: |
|
|
|
|
|
Accounts receivable |
|
(2,614 |
) |
|
|
(2,804 |
) |
Inventories |
|
1,205 |
|
|
|
(25,032 |
) |
Prepaid expenses and other assets |
|
1,268 |
|
|
|
2,269 |
|
Accounts payable, accrued liabilities, and operating lease
liabilities |
|
(11,118 |
) |
|
|
(13,439 |
) |
Net cash used in operating activities |
|
(2,630 |
) |
|
|
(23,022 |
) |
Cash
flows from investing activities: |
|
|
|
|
|
Acquisition
of business, net of cash acquired |
|
— |
|
|
|
(25,639 |
) |
Purchases of
property and equipment |
|
(9,164 |
) |
|
|
(3,312 |
) |
Issuance of
notes receivable |
|
— |
|
|
|
(600 |
) |
Other,
net |
|
39 |
|
|
|
30 |
|
Net cash used in investing activities |
|
(9,125 |
) |
|
|
(29,521 |
) |
Cash
flows from financing activities: |
|
|
|
|
|
Payments on
long-term debt |
|
(1,300 |
) |
|
|
— |
|
Proceeds
from revolving credit facility |
|
38,000 |
|
|
|
37,000 |
|
Repurchase
and retirement of common stock |
|
(293 |
) |
|
|
— |
|
Payment of
tax withholding obligation on settlement of equity awards |
|
(1,024 |
) |
|
|
— |
|
Payments of
tax receivable agreement |
|
(10,191 |
) |
|
|
— |
|
Contingent
consideration payments |
|
(250 |
) |
|
|
— |
|
Net cash provided by financing activities |
|
24,942 |
|
|
|
37,000 |
|
Effect of
exchange rate changes on cash and cash equivalents |
|
148 |
|
|
|
21 |
|
Net
increase (decrease) in cash and cash equivalents |
|
13,335 |
|
|
|
(15,522 |
) |
Cash
and cash equivalents at beginning of the period |
|
21,117 |
|
|
|
40,577 |
|
Cash
and cash equivalents at end of the period |
$ |
34,452 |
|
|
$ |
25,055 |
|
Supplementary cash flow information: |
|
|
|
Cash paid for interest |
$ |
14,098 |
|
|
$ |
7,710 |
|
Cash paid for taxes, net |
$ |
969 |
|
|
$ |
1,018 |
|
Noncash
investing and financing activities: |
|
|
|
|
|
Capital
expenditure in accounts payable |
$ |
937 |
|
|
$ |
305 |
|
|
|
|
|
|
|
Snap One Holdings Corp. and
SubsidiariesReconciliation of Net Loss to Adjusted
EBITDA(unaudited, in thousands)
|
Three Months Ended |
|
|
March 31, |
|
|
|
April 1, |
|
|
2023 |
|
|
|
2022 |
|
Net loss |
$ |
(14,548 |
) |
|
$ |
(2,256 |
) |
Interest expense |
|
13,949 |
|
|
|
6,723 |
|
Income tax benefit |
|
(3,000 |
) |
|
|
(361 |
) |
Depreciation and amortization |
|
15,202 |
|
|
|
14,889 |
|
Other expense (income), net |
|
827 |
|
|
|
(420 |
) |
Equity-based compensation |
|
7,763 |
|
|
|
5,599 |
|
Acquisition and integration related costs(a) |
|
— |
|
|
|
214 |
|
Compensation expense for payouts in lieu of TRA
participation(b) |
|
279 |
|
|
|
279 |
|
IT system transition costs(c) |
|
133 |
|
|
|
— |
|
Deferred revenue purchase accounting adjustment(d) |
|
— |
|
|
|
97 |
|
Fair value adjustment to contingent value rights(e) |
|
600 |
|
|
|
(2,800 |
) |
Deferred acquisition payments(f) |
|
78 |
|
|
|
703 |
|
Severance cost(g) |
|
1,276 |
|
|
|
— |
|
Other professional services costs(h) |
|
38 |
|
|
|
837 |
|
Other(i) |
|
75 |
|
|
|
87 |
|
Adjusted
EBITDA |
$ |
22,672 |
|
|
$ |
23,591 |
|
|
|
|
|
|
|
Snap One Holdings Corp. and
SubsidiariesReconciliation of Net Loss to Adjusted
Net Income(unaudited, in thousands)
|
Three Months Ended |
|
March 31, |
|
April 1, |
2023 |
|
2022 |
Net loss |
$ |
(14,548 |
) |
|
$ |
(2,256 |
) |
Amortization |
|
12,437 |
|
|
|
12,661 |
|
Equity-based compensation |
|
7,763 |
|
|
|
5,599 |
|
Foreign currency gains |
|
(58 |
) |
|
|
(179 |
) |
Interest rate cap expense |
|
818 |
|
|
|
— |
|
Acquisition and integration related costs(a) |
|
— |
|
|
|
214 |
|
Compensation expense for payouts in lieu of TRA
participation(b) |
|
279 |
|
|
|
279 |
|
IT system transition costs(c) |
|
133 |
|
|
|
— |
|
Deferred revenue purchase accounting adjustment(d) |
|
— |
|
|
|
97 |
|
Fair value adjustment to contingent value rights(e) |
|
600 |
|
|
|
(2,800 |
) |
Deferred acquisition payments(f) |
|
78 |
|
|
|
703 |
|
Severance cost(g) |
|
1,276 |
|
|
|
— |
|
Other professional services costs(h) |
|
38 |
|
|
|
837 |
|
Other(i) |
|
— |
|
|
|
19 |
|
Income tax effect of adjustments(j) |
|
(5,450 |
) |
|
|
(4,457 |
) |
Adjusted Net
Income |
$ |
3,366 |
|
|
$ |
10,717 |
|
|
|
|
|
|
|
(a) Represents costs directly associated with
acquisitions and acquisition-related integration activities. These
costs also include certain restructuring costs (e.g., severance)
and other third-party transaction advisory fees associated with
planned and completed acquisitions.(b) Represents
non-recurring expense related to payments to certain pre-IPO owners
in lieu of their participation in the Tax Receivable Agreement
(“TRA”). Management does not believe such costs are indicative of
our ongoing operations as they are one-time awards specific to the
establishment of the TRA.(c) Represents costs
associated with the implementation of enterprise resource planning
systems, customer resource management systems, and business
intelligence systems as part of our initiative to modernize our IT
infrastructure.(d) Represents an adjustment
related to the fair value of deferred revenue related to the
Control4 acquisition.(e) Represents noncash gains
and losses recorded from fair value adjustments related to
contingent value right (“CVR”) liabilities. Fair value adjustments
related to CVR liabilities represent potential obligations to the
prior sellers in conjunction with the acquisition of the Company by
investment funds managed by Hellman & Friedman, LLC (“H&F”)
in August 2017.(f) Represents expenses incurred
related to deferred payments to employees associated with
historical acquisitions. The deferred payments are cash retention
awards for key personnel from the acquired companies and are
expected to be paid to employees through 2023. Management does not
believe such costs are indicative of our ongoing operations as they
are one-time awards specific to acquisitions and are incremental to
our typical compensation costs incurred and we do not expect such
costs to be reflective of future increases in base compensation
expense.(g) Severance cost associated with various
restructuring actions such as warehouse relocation, departmental
reorganization and focused reduction in
workforce.(h) Represents professional service fees
associated with the preparation for Sarbanes-Oxley (“SOX”)
compliance, the implementation of new accounting standards and
accounting for non-recurring
transactions.(i) Represents non-recurring expenses
related to consulting, restructuring, and other expenses which
management believes are not representative of our operating
performance.(j) Represents the tax impacts with
respect to each adjustment noted above after taking into account
the impact of permanent differences using the statutory tax rate
related to the applicable federal and foreign jurisdictions and the
blended state tax rate.
Snap One Holdings Corp. and
SubsidiariesContribution
Margin(unaudited, in thousands)
|
Three Months Ended |
|
March 31, |
|
April 1, |
2023 |
|
2022 |
Net sales |
$ |
252,040 |
|
|
$ |
277,434 |
|
Cost of
sales, exclusive of depreciation and amortization(a) |
|
145,813 |
|
|
|
172,332 |
|
Net sales
less cost of sales, exclusive of depreciation and amortization |
$ |
106,227 |
|
|
$ |
105,102 |
|
Contribution Margin |
42.1 |
% |
|
37.9 |
% |
|
|
|
|
|
|
|
|
(a) Cost of sales for the three months ended
March 31, 2023 and April 1, 2022, excludes depreciation
and amortization of $15,202 and $14,889, respectively.
Snap One Holdings Corp. and
SubsidiariesFree Cash
Flow(unaudited, in thousands)
|
|
|
|
|
|
|
Three Months Ended |
|
March 31, |
|
April 1, |
2023 |
2022 |
Net cash used in operating activities |
$ |
(2,630 |
) |
|
$ |
(23,022 |
) |
Purchases of
property and equipment |
|
(9,164 |
) |
|
|
(3,312 |
) |
Free Cash Flow |
$ |
(11,794 |
) |
|
$ |
(26,334 |
) |
|
|
|
|
|
|
Snap One Holdings Corp. and
SubsidiariesRevenue by
Geography(unaudited, in thousands)
|
|
|
|
|
|
|
Three Months Ended |
|
March 31, |
|
April 1, |
2023 |
2022 |
Domestic
integrators(a) |
$ |
209,477 |
|
$ |
225,406 |
Domestic
other(b) |
|
9,242 |
|
|
13,353 |
International(c) |
|
33,321 |
|
|
38,675 |
Total |
$ |
252,040 |
|
$ |
277,434 |
|
|
|
|
|
|
(a) Domestic integrators is defined as
professional “do-it-for-me” integrator customers who transact with
Snap One through a traditional integrator channel in the United
States, excluding the impact of revenue earned by our Access
Networks enterprise grade network solution business, a recently
acquired business.(b) Domestic other is defined as
Access Networks revenue and revenue generated through managed
transactions with non-integrator customers, such as national
accounts.(c) International consists of all
integrators and distributors who transact with Snap One outside of
the United States.
Snap One Holdings Corp. and
SubsidiariesRevenue by Product
Type(unaudited, in thousands)
|
Three Months Ended |
|
March 31, |
|
April 1, |
2023 |
2022 |
Proprietary products(a) |
$ |
171,375 |
|
$ |
187,797 |
Third-party
products(b) |
|
80,665 |
|
|
89,637 |
Total |
$ |
252,040 |
|
$ |
277,434 |
|
|
|
|
|
|
(a) Proprietary products consist of products
and services internally developed by Snap One and sold under one of
Snap One’s proprietary brands.(b) Third-party
products consist of products that Snap One distributes but to which
Snap One does not own the intellectual property.
1 We have not reconciled the forward-looking adjusted EBITDA
guidance included above to the most directly comparable GAAP
measure because this cannot be done without unreasonable effort due
to the variability and low visibility with respect to certain
costs, the most significant of which are incentive compensation
(including stock-based compensation), transaction-related expenses,
and certain fair value measurements, which are potential
adjustments to future earnings. We expect the variability of these
items to have a potentially unpredictable, and a potentially
significant, impact on our future GAAP financial results.
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