Q2 2024 Hf Foods Group Inc Earnings Call (Pre-Recorded) Transcript
Key Points
- Net revenue increased by 3.4% to $302.3 million compared to the prior year quarter.
- Gross profit increased by 3.6% to $52.5 million, with gross profit margins slightly improving to 17.4%.
- Distribution, selling, and administrative expenses decreased by approximately 4.6%, improving operational efficiency.
- Adjusted EBITDA increased by 26.4% to $10.6 million, indicating strong operational performance.
- Successful implementation of a modern ERP system at one of the California distribution centers, enhancing operational efficiency.
- Revenue was negatively impacted by a $3.1 million loss due to the exit from the chicken processing business.
- Gross margins on wholesale sales are lower than retail sales, which may affect overall profitability in the short term.
- Total interest expense increased to $3.1 million from $2.8 million in the prior year quarter.
- The company faced a $3.9 million SEC settlement, impacting net income.
- The fair value of interest rate swaps resulted in a $2.5 million negative impact.
Hello, everyone. Welcome to HF Foods Group second quarter 2024 earnings conference call. Joining me on today's call are Peter Zhang, Chief Executive Officer; Felix Lin, President and Chief Operating Officer, and Cindy Yao, Chief Financial Officer.
By now everyone should have access to the earnings release for the period ended June 30, 2024, that went out Tuesday, August 6, at approximately 4:05 PM Eastern time. The press release is accessible on the company's website at investors.hffoodsgroup.com.
Before we begin, let me remind everyone that today's discussion contains forward-looking statements based on the environment as the company currently sees it, and as such does not include risks and uncertainties. If you refer to HF Foods earnings release as well as the company's most recent SEC filings. You will see a discussion of factors that could cause the company's actual results to differ materially as a result of those forward-looking statements.
Please remember that the company undertakes no obligation to update or revise any forward-looking
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