Q3 2024 Goodfood Market Corp Earnings Call Transcript
Key Points
- Goodfood Market Corp (GDDFF) achieved its sixth consecutive quarter of positive adjusted EBITDA, reaching a margin of 9.2% for $3.6 million.
- The company reported a significant improvement in adjusted free cash flow, generating $4.4 million this quarter and $8.7 million year to date.
- Gross margin reached a record 44% in the third quarter, a 300 basis-point improvement compared to the same quarter last year.
- Goodfood Market Corp (GDDFF) has reduced net leverage from 8.2 turns last year to 2.1 turns this quarter, decreasing the risk of its capital structure.
- The company has introduced new customer-centric initiatives, such as doubling the lineup of recipes on its value menu and launching 'Camp Goodfood' to enhance customer engagement and satisfaction.
- Net sales declined by 8% year-over-year to $38.6 million, driven by lower customer count and consumer spending softness.
- Active customers decreased to 105,000, influenced by early seasonality and lower customer acquisition.
- Despite improvements, the company faces challenging demand circumstances and expects to return to year-over-year organic growth only when macroeconomic headwinds abate.
- The value meals, while popular, have slightly lower margins compared to the average Goodfood box.
- Seasonality and macroeconomic challenges continue to impact customer activity, with potential further declines expected in the fourth quarter.
Good morning, ladies and gentlemen, and welcome to the Goodfood Q3 FY 2024 earnings and webcast conference call. (Operator Instructions)
I would like to remind everyone that this conference call is being recorded, today, July 16 at 8:00 AM Eastern Time. Furthermore, I would like to remind that today's presentation may contain forward-looking statements about Goodfood's current and future plans, expectations and intentions, results, level of activity, performance goals or achievements or other future events or developments.
As such, please take a moment to read the disclaimer on forward-looking statements on slide 2 of the presentation. Please be aware that during the call presenters will refer to certain metrics and non-IFRS measures. Where possible these measures are identified and reconciled to the most comparable IFRS measures in our MD&A.
Finally, let me remind you that all figures expressed on today's call are in Canadian dollars unless otherwise stated.
I would now like to turn the meeting over to your host for today's call, Jonathan Ferrari, Goodfood Chief
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