Q3 2024 Eastern Company Earnings Call Transcript
Key Points
- The Eastern Co (EML) reported a 15% increase in net sales for the third quarter, reaching $71.3 million compared to $62 million in the same period of 2023.
- Gross margin improved to 25.5% from 24.9% in the previous year, reflecting better price/cost alignment and cost-saving initiatives.
- The company's backlog increased by 13% to $97.2 million, driven by higher orders for truck mirror assemblies and returnable transport packaging products.
- Net income for the third quarter rose to $4.7 million, or $0.75 per diluted share, up from $3.5 million, or $0.55 per diluted share, in the prior year.
- The Eastern Co (EML) appointed a new CEO, Ryan Schroeder, who has a strong track record in leading manufacturing companies to sustained long-term growth.
- The company recognized a $19.2 million net loss from the write-down of the Big 3 Mold business, which was classified as discontinued operations.
- Selling and administrative expenses increased by 22% or $1.9 million, primarily due to higher payroll-related and legal and professional expenses.
- Cash flow from operating activities decreased significantly to $8.3 million for the first nine months of 2024, compared to $18.2 million in the same period of 2023.
- The senior net leverage ratio increased to 1.4 from 1.2 at the end of the second quarter, indicating higher financial leverage.
- The company experienced a $11.7 million increase in accounts receivable, impacting cash flow due to increased revenue and prebilling for material costs.
Good morning and welcome to the Eastern Company's third quarter, fiscal year 2024 earnings call.
(Operator Instructions)
I will now turn the conference over to your host, Marianne Barr, treasurer of the Eastern Company, Mary Anne over to you.
Good morning and thank you everyone for joining us this morning for a review of the Eastern Company's results for the third quarter of 2024.
With me on the call are James Mitarotonda, Chair of Eastern's Board of Directors and the company's CFO Nicholas Vlahos.
The company issued earnings press release yesterday after the market closed. If anyone has not yet seen the release, please visit the investors section of the company's website, www.easterncompany.com where you will find the release under financial news.
Please note that some of the information you will hear during today's call will consist of forward-looking statements about the company's future financial
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