On August 7, 2024, Leslies Inc (LESL, Financial) released its 8-K filing detailing the financial results for the third quarter of fiscal 2024. Leslies Inc is a direct-to-consumer pool and spa care brand offering a comprehensive assortment of products across chemicals, equipment and parts, cleaning and maintenance equipment, and safety, recreational, and fitness-related products. The company operates exclusively in the United States.
Performance Overview
Leslies Inc reported sales of $569.6 million for the third quarter, a 6.8% decrease compared to $610.9 million in the same period last year. The company also reported a net income of $60.7 million, down from $72.5 million in the prior year period. Diluted earnings per share (EPS) came in at $0.33, beating the analyst estimate of $0.15. Adjusted diluted EPS was $0.34, also below the prior year's $0.41.
“As we noted in our preliminary results on July 17, our fiscal third quarter results were impacted by a cold and wet start to the pool season, as well as continued weakness in discretionary product sales due to persistent inflation and high interest rates,” said Mike Egeck, Chief Executive Officer.
Financial Achievements and Challenges
Despite the challenging market conditions, Leslies Inc managed to achieve an adjusted EBITDA of $109.5 million, although this was a decline from $129.0 million in the prior year period. The company's gross profit was $228.8 million, down 9.0% from $251.6 million last year, with a gross margin of 40.2% compared to 41.2% in the prior year.
Leslies Inc faced several challenges, including a decrease in comparable sales by 7.0% and a reduction in operating income to $97.7 million from $115.8 million in the prior year period. Interest expenses also increased slightly to $18.2 million from $17.7 million.
Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Sales | $569.6 million | $610.9 million |
| Net Income | $60.7 million | $72.5 million |
| Gross Profit | $228.8 million | $251.6 million |
| Adjusted EBITDA | $109.5 million | $129.0 million |
| Diluted EPS | $0.33 | $0.39 |
Balance Sheet and Cash Flow
Leslies Inc reported cash and cash equivalents of $74.4 million as of June 29, 2024, a significant increase from $19.4 million as of July 1, 2023. Inventories decreased by 30.8% to $302.2 million. The company also reduced its funded debt to $783.7 million from $822.8 million. Net cash provided by operating activities was $60.4 million, compared to net cash used in operating activities of $74.8 million in the prior year period.
Outlook
Leslies Inc reaffirmed its outlook for the full year of fiscal 2024, with expected sales ranging from $1,321 to $1,347 million and adjusted diluted earnings per share between $0.03 and $0.09.
For more detailed information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Leslies Inc for further details.
