On November 8, 2023, Holley Inc (HLLY, Financial), a leading platform for automotive performance enthusiasts, announced its financial results for the third quarter ended October 1, 2023. The company reported a year-over-year revenue increase and significant margin improvements, attributing the success to operational enhancements and a strategic focus on customer engagement.
Financial Performance Highlights
Holley Inc (HLLY, Financial) experienced a notable shift in its financial metrics, with a Net Income Margin of 0.5% compared to 20.4% in the prior year. Adjusted Net Income was reported at $3.5 million, a stark contrast to the Adjusted Net Loss of $4.1 million in the same period last year. The company also generated $22.5 million in Net Cash from Operating Activities, a substantial improvement from a negative $8.7 million previously. Free Cash Flow was another area of strength, reaching $21.7 million compared to a negative $10.6 million in the prior year.
Operational and Strategic Developments
President and CEO Matthew Stevenson highlighted the company's return to top-line growth and improvements in profitability metrics.
Our efforts to strengthen Holley’s employee and customer relationships and optimize our operations are taking hold,"Stevenson stated, expressing confidence in the company's strategic priorities and growth potential.
Holley Inc (HLLY, Financial) has focused on reducing past due orders, which decreased by $8.1 million, and inventory levels, which saw a $10.3 million reduction. The company's bank-adjusted EBITDA leverage ratio improved to 4.89x, below the amended covenant ceiling and original covenant level.
Stevenson also emphasized the importance of consumer and customer engagement programs in the company's transformation, including a record-setting season of enthusiast consumer events and the establishment of seven distinct product category teams to align with customer needs.
Revised Full Year 2023 Outlook
Chief Financial Officer Jesse Weaver provided an optimistic outlook, noting the company's net sales growth and year-over-year gross margin and Adjusted EBITDA improvements.
Our strong overall performance benefited from continued progress on reducing our past due orders and reducing inventory levels, both of which contributed to strong free cash flow in the quarter, allowing us to pay down $25 million in debt in September,"Weaver explained. Consequently, Holley Inc (HLLY, Financial) has raised the lower end of its net sales and Adjusted EBITDA guidance for the full year 2023.
Investors and analysts are encouraged to join the conference call and audio webcast scheduled to discuss these results and can find additional financial information on Holley's investor relations website.
About Holley Inc.
Holley Inc. (NYSE: HLLY) is renowned for designing, marketing, and manufacturing high-performance products for automotive enthusiasts. The company has been successful in disrupting the performance category by prioritizing enthusiast consumers, innovating new products, and expanding through strategic acquisitions.
For more detailed financial information and to understand the non-GAAP financial measures such as EBITDA, Adjusted EBITDA, and Free Cash Flow, please visit Holley's investor relations page.
Please note that this summary is for informational purposes only and should not be considered as investment advice. For further details and to make informed investment decisions, readers are encouraged to review the full earnings report and consult with financial advisors.
Explore the complete 8-K earnings release (here) from Holley Inc for further details.
