Branded Consumer Performance drives strong fourth quarter operating results, increases year-over-year sales and exceeds management expectations
Permanent Capital Advantage Positioned CODI to acquire two platform companies in 2020 and complete strategic add-ons
The full year results show the benefits of a diversified model in navigating volatility
WESTPORT, Conn., February 24, 2021 (GLOBE NEWSWIRE) – Compass Diversified (NYSE: CODI) ("CODI" or the "Company"), owner of leading medium-sized companies, today announced its consolidated operating results for the three and twelve months ended December 31, 2020 December 2020.
Highlights of the fourth quarter and all of 2020
- Reported net sales of $ 474.8 million for the fourth quarter of 2020 and $ 1.561 billion for the full year 2020;
- Reported net income of $ 8.8 million for the fourth quarter of 2020 and $ 27.2 million for the full year 2020;
- Reported Non-GAAP Adjusted EBITDA of $ 79.8 million for the fourth quarter of 2020 and $ 249.2 million for the full year 2020;
- Reported cash flow from continuing operations of $ 35.8 million for the fourth quarter of 2020 and $ 148.6 million for the full year 2020, and non-GAAP cash flow ("CAD") available for sales and reinvestment of 36, $ 0 million for the fourth quarter of 2020 and $ 110.6 million for the full year 2020;
- Paying a cash distribution in the fourth quarter of 2020 of $ 0.36 per share on the common stock of CODI in January 2021; and
- Paid quarterly cash distributions of $ 0.453125 per share on the Company's 7.250% Series A preferred stock, $ 0.4921875 per share on the Company's 7.875% Series B preferred stock, and $ 0.4921875 per share on the 7.875% Company's Series C Preferred Stock, payable January 30, 2021.
"I am incredibly proud of our strong fourth quarter and full year results, which show how CODI's differentiated model has evolved across business cycles," said Elias Sabo, CEO of Compass Diversified. “We achieved impressive organic growth year-on-year and thanks to our permanent capital strategy we were able to take advantage of numerous exciting market opportunities. At a time when uncertainty and unprecedented volatility paralyzed many market participants, we have acquired Marucci and BOA, two very emerging and fast growing consumer companies, and we have already begun to see the impact of these strong brands. "
Mr. Sabo continued: “Our performance in 2020 is also proof of the strategic diversification in our portfolio and the high quality of our subsidiaries. We look forward to working with our leading niche brands again in the year ahead to add value to shareholders. "
Operating results
Net sales for the quarter ended December 31, 2020 were $ 474.8 million compared to $ 387.0 million for the quarter ended December 31, 2019. Net sales were $ 1.561 billion for the fiscal year ended December 31, 2020 compared to $ 1.450 billion for the fiscal year ended December 31, 2019.
Net income for the quarter ended December 31, 2020 was $ 8.8 million compared to $ 5.4 million for the quarter ended December 31, 2019. For the fiscal year ended December 31, 2020, CODI reported net income of $ 27.2 million versus net income of $ 307.1 million, including $ 331.0 million in profit from sales of Clean Earth and Manitoba Harvest for the year ended December 31, 2020 Fiscal year ending December 31, 2019.
Adjusted EBITDA (see "Note on the Use of Non-GAAP Financial Measures" below) for the quarter ended December 31, 2020 was $ 79.8 million, compared to $ 61.7 million for the December 31, 2020 End of 2019 quarter. Adjusted EBITDA for the year ended December 31, 2020 was $ 249.2 million compared to $ 226.1 million for the year ended December 31, 2019. The year-over-year increase in Adjusted EBITDA for the fourth quarter and full year 2020 was primarily a result of our 2020 acquisitions of BOA and Marucci, as well as strong performance in the branded consumer companies.
Liquidity and capital resources
For the quarter ended December 31, 2020, CODI reported cash flow from operating activities of $ 35.8 million compared to cash flow from operating activities of $ 53.0 million for the quarter ended December 31, 2019.
CODI reported $ 36.0 million in CAD for the quarter ended December 31, 2020 (see "Note on Using Non-GAAP Financial Measures") compared to $ 30.0 million for the same quarter last year. CODI's CAD is calculated taking into account all interest expenses, cash taxes paid, preferential distributions and maintenance investments, and includes the operating results of each of our businesses for the periods in which CODI owned them. However, CAD excludes profits from monetizing the shares in the CODI subsidiaries, which have exceeded $ 1.0 billion since going public in 2006.
The weighted average number of CODI shares outstanding for the quarter ended December 31, 2020 was 64.9 million and for the quarter ended December 31, 2019, 59.9 million.
As of December 31, 2020, CODI had approximately $ 70.7 million in cash, $ 307 million outstanding on its revolver, and $ 600 million outstanding on 8.00% senior notes due 2026.
The company has no material maturities through 2026 and had a net loan availability of $ 292 million as of December 31, 2020 under its revolving credit facility.
Payouts for the fourth quarter of 2020
On January 4, 2021, CODI's board of directors (the “Board of Directors”) declared a dividend of $ 0.36 per share on the company's common stock for the fourth quarter. The cash distribution was paid on January 22, 2021 to all holders of common shares as of January 15, 2021. Since going public in 2006, CODI has paid an accumulated dividend of $ 20,3952 per common share.
The Board of Directors also declared a quarterly cash distribution of $ 0.453125 per share for the Company's 7.250% Series A Preferred Stock (the “Series A Preferred Stock”). The distribution on the series A preference shares extends over the period from October 30, 2020 to January 30, 2021 inclusive. The distribution for this period was due on January 30, 2021 to all registered holders of series A preference shares to be paid on the 15. January 2021. Payment was made on February 1, 2021, the next business day after the payment date.
The Board of Directors also declared a quarterly cash distribution of $ 0.4921875 per share on the Company's 7.875% Series B Preferred Stock (the "Series B Preferred Stock"). The distribution on the series B preferred shares extends over the period from October 30, 2020 to January 30, 2021 inclusive. The distribution for this period was due on January 30, 2021 to all registered holders of series B preferred shares to be paid on the 15th January 2021. Payment was made on February 1, 2021, the next business day after the payment date.
The Board of Directors also declared a quarterly cash distribution of $ 0.4921875 per share on the Company's 7.875% Series C Preferred Stock (the "Series C Preferred Stock"). The distribution on the Series C preference shares extends over the period from October 30, 2020 to January 30, 2021 inclusive. The distribution for this period was due on January 30, 2021 to all registered holders of Series C preference shares to be paid by the 15th January 2021. Payment was made on February 1, 2021, the next business day after the payment date.
Instructions update
The company anticipates that its current subsidiaries will achieve consolidated adjusted EBITDA (see "Note on Using Non-GAAP Financial Measures" below) between $ 305 million and $ 325 million in 2021. This estimate is based on the sum of our expectations for our current subsidiaries in 2021 with no additional acquisitions or divestments, and excludes corporate expenses such as interest expenses, management fees and corporate overheads. In addition, our payout ratio (see "Note on the Use of Non-GAAP Financial Metrics" below), defined as our prior year distribution to common stockholders divided by our estimate for CAD 2021, is expected to be between 80% and 70%. .
Corporate structure
The company is considering changing its tax structure, including the option of opting for taxation as a C company. The company evaluates the costs and benefits of such a change, as well as the impact of current and future tax law, corporate law and the potential impact of such a change on the company's access to capital markets, sales policies and corporate debt ratings, cost of capital, among many others Considerations. The company expects to provide updates on this process as appropriate.
telephone conference
Management will host a conference call on Wednesday, February 24, 2021 at 5:00 p.m. CET. ET to discuss the latest company developments and financial results. The dial-in number for callers in the United States is (833) 900-1532 and the dial-in number for international callers is (236) 712-2273. The access code for all callers is 1291438. A live webcast will also be available on the company's website at https://www.compassdiversified.com.
The call will be replayed until March 3, 2021. To access the replay, please dial (800) 585-8367 in the US and (416) 621-4642 outside of the US, then enter the access code 1291438.
Notice regarding the use of non-GAAP financial measures
Adjusted EBITDA is a non-GAAP measure that the company uses to measure its performance. We have matched Adjusted EBITDA to net income (loss) using the attached schedules. We view net income (loss) as the GAAP financial measure most directly comparable to Adjusted EBITDA. We believe that Adjusted EBITDA provides useful information to investors and reflects key financial measures by eliminating the impact of items that reflect the impact of long-term investment decisions rather than the performance of short-term operations. When compared to net income (loss), Adjusted EBITDA is limited in that it does not reflect the periodic cost of certain investments that are used to generate revenue from our business or the impairment-related non-cash expenses and certain cash expenses. This presentation also allows investors to view the performance of our business in a manner similar to the methods used by us and the management of our business, provides additional insight into our operating results, and provides a means of evaluating target companies for acquisition. We believe Adjusted EBITDA is also useful in measuring our ability to service debt and other payment obligations.
CAD is a non-GAAP metric that the company uses to assess its performance and ability to maintain quarterly distributions. We have matched CAD against net income (loss) and cash flow from operating activities in the attached schedules. We consider net income (loss) and cash flow from operating activities to be the most directly comparable GAAP financial measures to CAD.
CAD is calculated taking into account all interest paid, cash taxes paid, and maintenance investments, and includes the operating results of each of our companies for the periods that CODI owned them. We believe that CAD provides additional information to investors to enable them to evaluate our performance and ability to make expected quarterly distributions.
The Payout Ratio is a non-GAAP measure defined as the previous year's annual distribution to common stockholders divided by our CAD. We believe the Payout Ratio provides additional information for investors to evaluate our performance and our ability to sustain quarterly distributions.
In view of the exception for unreasonable efforts provided in Item 10 (e) (1) (i) (B) of Regulation SK, we have not included the Adjusted EBITDA 2021 or the 2021 Payout Ratio (which requires an estimate of CAD 2021) with theirs comparable figure brought in line with GAAP metric because we do not provide guidance on net income (loss), cash flow from operating activities, or the corresponding reconciliation items due to the uncertainty and potential variability of these items. For the same reasons, we cannot address the likely significance of the unavailable information that could be material to future results. Accordingly, these estimates should not be placed under undue reliance on.
None of the Adjusted EBITDA, CAD, or Payout ratios are intended to be a substitute for GAAP measures and may not differ or otherwise be inconsistent with the non-GAAP financial measures used by other companies.
About Compass Diversified ("CODI")
CODI owns and manages a large number of highly responsible North American medium-sized companies. Each of their current subsidiaries is a leader in their niche market. More information is available at kompassdiversified.com.
Using its permanent capital base, long-term disciplined approach and actionable expertise, CODI continues to control ownership interests in each of its subsidiaries to maximize its ability to influence long-term cash flow generation and value creation. The company makes both debt and equity available to its subsidiaries, thus contributing to their financial and operational flexibility. CODI uses the cash flows generated by its subsidiaries to invest in the company's long-term growth and has consistently delivered high returns through its culture of transparency, alignment and accountability.
Our ten majority-owned subsidiaries operate in the following business areas:
- The design and marketing of purpose-built technical apparel and equipment for a wide range of global customers (5.11);
- The manufacture of fast, small and production-rigid printed circuit boards (Advanced circuits);
- The design and manufacture of customized packaging, insulation and components (Altor Solutions);;
- The manufacture of engineering magnet solutions for a wide range of specialty applications and end markets (Arnold Magnetic Technologies);
- Design and commercialization of dial-based fit systems that provide a high-performance fit for shoes, headgear, and medical brace products (BOA technology);
- Design and marketing of portable baby carriers, strollers and related products (Ergobaby);
- The design and manufacture of premium home and gun safes (Liberty Safe);
- The design and manufacture of baseball and softball equipment and clothing (Marucci Sports);
- Manufacture and marketing of portable heating systems for food that are used in the catering industry, creative indoor and outdoor lighting and room fragrance solutions for the consumer market (Sterno); and
- Development, manufacture and marketing of air rifles, archery products, optics and related accessories (Speed outdoors).
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements about our future performance or liquidity, such as: B. Expectations regarding our results of operations, financial position and cash flows for the full year 2021, our total adjusted EBITDA 2021, our payout ratio 2021 and 2021 CAD, and our ability to meet existing commitments, and other statements regarding the future performance of CODI. We may use words such as "anticipate," "believe," "expect," "intend," "will," "should," "may," "seek," "look" and similar expressions to identify forward-looking statements. Actual results could for any reason differ materially from those implied or expressed in any forward-looking statement, including those set out in “Risk Factors” and elsewhere in the CODI Annual Report on Form 10-K and the Quarterly Reports on Form 10-Q listed factors. Forward-looking statements involve risks and uncertainties including, but not limited to, changes in the economy, financial markets and political environment, including the short-, medium- and long-term effects of the COVID-19 pandemic or the social or social pandemic related to political unrest on our business, results of operations, financial position, liquidity, cash flows or the ability to distribute; our business prospects and the prospects of our portfolio companies; Risks related to possible disruption to CODI's business or the economy in general due to terrorism and natural disasters; future changes in any law or regulation (including how regulatory authorities interpret those laws and regulations); the impact of any investments we make or anticipate; the dependence of our future success on the general economy and its impact on the industries in which we operate; the ability of our portfolio companies to achieve their goals; the adequacy of our cash resources and working capital; where applicable, the timing of the cash flows from the operations of our portfolio companies; whether a change in the tax structure will be made and if this is the timing, conditions or benefits of such a change; and other considerations that may from time to time be disclosed in CODI's publicly distributed documents and records. Undue reliance should not be placed on such forward-looking statements, as such statements speak only as of the date they are made. Although CODI has no obligation, except as required by law, to revise or update any forward-looking statements as a result of new information, future events or for any other reason, it is recommended that you consult additional information that CODI may make to you directly or through reports which it may file with the SEC in the future, including annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K.
| Investor Relations: The IGB Group Leon Berman 212-477-8438 [email protected] |
Media contact: Joele Frank, Wilkinson Brimmer Katcher Jon Keehner / Kate Thompson / Lyle Weston 212-355-4449 |
Compass Diversified Holdings
Consolidated income statement
| Three months to December 31st | Twelve months to December 31st | ||||||||||||||
| (in thousands, excluding data per share) | 2020 | 2019 | 2020 | 2019 | |||||||||||
| Net sales | $ | 474.778 | $ | 386.999 | $ | 1,560,757 | $ | 1,450,253 | |||||||
| Cost of sales | 302.672 | 246.209 | 997.976 | 930.810 | |||||||||||
| Gross income | 172.106 | 140.790 | 562.781 | 519.443 | |||||||||||
| Operating expenses: | |||||||||||||||
| Selling, general and administrative expenses | 110.414 | 91,445 | 371.264 | 335.181 | |||||||||||
| Management fees | 11,313 | 8,678 | 34,749 | 37.030 | |||||||||||
| Depreciation | 18,429 | 13,523 | 61,935 | 54,155 | |||||||||||
| Depreciation expense | – – | (500 | ) | – – | 32,881 | ||||||||||
| Operating profit | 31,950 | 27,644 | 94,833 | 60.196 | |||||||||||
| Other income (expenses): | |||||||||||||||
| Net interest expense | (13,646 | ) | (9.792 | ) | (45.768 | ) | (58.216 | ) | |||||||
| Amortization of issuing costs | (659 | ) | (689 | ) | (2.454 | ) | (3.314 | ) | |||||||
| Loss on debt settlement | – – | (7.281 | ) | – – | (12.319 | ) | |||||||||
| Loss on sales of Tilray securities | – – | – – | – – | (10, 193 | ) | ||||||||||
| Other expenses, net | (448 | ) | (972 | ) | (2.620 | ) | (2.185 | ) | |||||||
| Income from continuing operations before income taxes | 17.197 | 8,910 | 43.991 | (26.031 | ) | ||||||||||
| Provision for income taxes | 8,417 | 4.367 | 16,894 | 14,742 | |||||||||||
| Result from continuing operations | 8,780 | 4,543 | 27.097 | (40.773 | ) | ||||||||||
| Result from discontinued operations after taxes | – – | – – | – – | 16,901 | |||||||||||
| Profit from the sale of discontinued operations | – – | 810 | 100 | 331.013 | |||||||||||
| Net income | 8,780 | 5.353 | 27.197 | 307.141 | |||||||||||
| Less: Income from continuing operations that are attributable to non-controlling interests | 414 | 1.545 | 4,417 | 5,542 | |||||||||||
| Less: loss from discontinued operations due to non-controlling interests | – – | – – | – – | (266 | ) | ||||||||||
| Annual surplus attributable to participations | $ | 8,366 | $ | 3.808 | $ | 22,780 | $ | 301.865 | |||||||
| Basic income (loss) per common share that is attributable to the investments | |||||||||||||||
| Ongoing activities | $ | (0.06 | ) | $ | (0.79 | ) | $ | (0.34 | ) | $ | (2.17 | ) | |||
| Discontinued operations | – – | 0.01 | – – | 5.81 | |||||||||||
| $ | (0.06 | ) | $ | (0.78 | ) | $ | (0.34 | ) | $ | 3.64 | |||||
| Base-weighted average number of common shares outstanding | 64,900 | 59,900 | 63,151 | 59,900 | |||||||||||
| Cash distributions per Trust Common Share | $ | 0.36 | $ | 0.36 | $ | 1.44 | $ | 1.44 | |||||||
| Compass Diversified Holdings | ||||||||||||||||
| Net sales with pro forma net sales reconciliation | ||||||||||||||||
| (unchecked) | ||||||||||||||||
| Three months to December 31st | Twelve months to December 31st | |||||||||||||||
| (in thousands) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
| Net sales | $ | 474.778 | $ | 386.999 | $ | 1,560,757 | $ | 1,450,253 | ||||||||
| Acquisitions (1) | 3,913 | 44,977 | 103,587 | 172,800 | ||||||||||||
| Pro forma net sales | $ | 478.691 | $ | 431.976 | $ | 1,664,344 | $ | 1,623,053 | ||||||||
(1) The acquisitions reflect the net sales of Marucci Sports and Boa pro forma, as if we had acquired this business on January 1, 2019.
| Compass Diversified Holdings | ||||||||||||||||
| Subsidiary net sales | ||||||||||||||||
| (unchecked) | ||||||||||||||||
| Three months to December 31st | Twelve months to December 31st | |||||||||||||||
| (in thousands) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
| Brand consumers | ||||||||||||||||
| 5.11 | $ | 119.284 | $ | 109,667 | $ | 401.106 | $ | 388.645 | ||||||||
| BOA (1) | 29.193 | 28,440 | 106.365 | 106.276 | ||||||||||||
| Ergobaby | 15,557 | 21,253 | 74,728 | 89.995 | ||||||||||||
| freedom | 32,516 | 28,598 | 113.115 | 96.164 | ||||||||||||
| Marucci Sports (1) | 18,633 | 16,537 | 65,942 | 66,524 | ||||||||||||
| Speed outdoors | 67,756 | 40,449 | 215.996 | 147,842 | ||||||||||||
| Total branded consumer | $ | 282,939 | $ | 244,944 | $ | 977.252 | $ | 895.446 | ||||||||
| Niche industry | ||||||||||||||||
| Advanced circuits | $ | 20,652 | $ | 23,386 | $ | 88,075 | $ | 90.791 | ||||||||
| Arnold Magnetics | 22,543 | 29,544 | 98,990 | 119,948 | ||||||||||||
| Foam maker | 40,708 | 27,790 | 130.046 | 121,424 | ||||||||||||
| Sterno | 111,849 | 106.312 | 369.981 | 395,444 | ||||||||||||
| Total niche industry | $ | 195,752 | $ | 187.032 | $ | 687.092 | $ | 727,607 | ||||||||
| Total sales of the subsidiary | $ | 478.691 | $ | 431.976 | $ | 1,664,344 | $ | 1,623,053 | ||||||||
(1) Marucci Sports and BOA net sales are pro forma, as if we acquired this business on January 1st, 2019.
| Compass Diversified Holdings | |||||||||||||||
| Net income on adjusted EBITDA and cash flow available for distribution and reinvestment | |||||||||||||||
| (Unchecked) | |||||||||||||||
| Three months to December 31st | Twelve months to December 31st | ||||||||||||||
| (in thousands) | 2020 | 2019 | 2020 | 2019 | |||||||||||
| Net income | $ | 8,780 | $ | 5.353 | $ | 27.197 | $ | 307.141 | |||||||
| Result from discontinued operations after taxes | – – | – – | – – | 16,901 | |||||||||||
| Profit from the sale of discontinued operations | – – | 810 | 100 | 331.013 | |||||||||||
| Result from continuing operations | $ | 8,780 | $ | 4,543 | $ | 27.097 | $ | (40.773 | ) | ||||||
| Provision for income taxes | 8,417 | 4.367 | 16,894 | 14,742 | |||||||||||
| Income from continuing operations before income taxes | $ | 17.197 | $ | 8,910 | $ | 43.991 | $ | (26.031 | ) | ||||||
| Other expenses, net | (448 | ) | (8.253 | ) | (2.620 | ) | (14.504 | ) | |||||||
| Amortization of issuing costs | (659 | ) | (689 | ) | (2.454 | ) | (3.314 | ) | |||||||
| Loss on sales of Tilray securities | – – | – – | – – | (10, 193 | ) | ||||||||||
| Net interest expense | (13,646 | ) | (9.792 | ) | (45.768 | ) | (58.216 | ) | |||||||
| Operating profit | $ | 31,950 | $ | 27,644 | $ | 94,833 | $ | 60.196 | |||||||
| Adapted for: | |||||||||||||||
| depreciation | 9.262 | 8.526 | 34,954 | 33,153 | |||||||||||
| Amortization | 19,912 | 13,523 | 67,798 | 54,155 | |||||||||||
| Non-controlling shareholder compensation | 2,879 | 1,789 | 8,995 | 6,054 | |||||||||||
| acquisition cost | 2.517 | – – | 4.832 | – – | |||||||||||
| Integration Services Fees | 1.625 | – – | 2.125 | 281 | |||||||||||
| Management fees | 11,313 | 8,678 | 34,749 | 37.030 | |||||||||||
| Depreciation expense | – – | (500 | ) | – – | 32,881 | ||||||||||
| Adjustment of the earnout provision | – – | 2.022 | – – | 2.022 | |||||||||||
| Other | 325 | – – | 922 | 324 | |||||||||||
| Adjusted EBITDA | $ | 79,783 | $ | 61.682 | $ | 249.208 | $ | 226.096 | |||||||
| Interest on corporate, less unused fees (1) | (13.491 | ) | (9.281 | ) | (44, 604 | ) | (52, 417 | ) | |||||||
| Swap payment | – – | – – | – – | (675 | ) | ||||||||||
| Management fees | (11,313 | ) | (8.678 | ) | (34.749 | ) | (37.030 | ) | |||||||
| Investments (maintenance) | (6.717 | ) | (7.244 | ) | (17.084 | ) | (18.510 | ) | |||||||
| Current tax expense (cash taxes) (2) | (5.846 | ) | (2.706 | ) | (17.675 | ) | (15.288 | ) | |||||||
| Preferred Share Distributions | (6.045 | ) | (3,781 | ) | (23.678 | ) | (15.125 | ) | |||||||
| Discontinued operations | – – | – – | – – | 16,987 | |||||||||||
| Different articles | (378 | ) | – – | (772 | ) | – – | |||||||||
| Cash flow available for sales and reinvestment ("CAD") | $ | 35,993 | $ | 29,992 | $ | 110.646 | $ | 104.038 | |||||||
| (1 | ) | Interest expense at Corporate reflects the consolidated interest expense minus non-cash components such as unrealized gains and losses from our swap and the original payback amortization. We are including the above cash component of our swap payment in our reconciliation to the CAD. | |
| (2 | ) | The current tax expense is calculated by subtracting the change in deferred taxes from the cash flow statement from the income tax provision in the income statement. | |
| Compass Diversified Holdings | ||||||||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | ||||||||||||||||||||||||||||||||||||||||||||||||
| (Unchecked) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Fiscal year ended December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Corporate | 5.11 | BOA | Ergobaby | freedom | Marucci Sports | Speed outdoors | ACI | Arnold | Foam maker | Sterno | Consolidated | |||||||||||||||||||||||||||||||||||||
| Net income (loss) | $ | (19.065 | ) | $ | 12,356 | $ | (2,640 | ) | $ | 725 | $ | 9,902 | $ | (4,785 | ) | $ | 11,161 | $ | 13,170 | $ | (3.539 | ) | $ | 6,092 | $ | 3.820 | $ | 27.197 | ||||||||||||||||||||
| Adapted for: | ||||||||||||||||||||||||||||||||||||||||||||||||
| Provision (performance) for income taxes | – – | 1.808 | (535 | ) | 2.033 | 3.288 | (1,390 | ) | 3,560 | 3.431 | (198 | ) | 2.554 | 2,343 | 16,894 | |||||||||||||||||||||||||||||||||
| Net interest expense | 45,610 | 19th | – – | – – | – – | 7th | 131 | – – | – – | – – | 1 | 45,768 | ||||||||||||||||||||||||||||||||||||
| Intercompany interest | (70.449 | ) | 14,085 | 2.043 | 2.405 | 3.548 | 1,843 | 8,915 | 5.778 | 5.730 | 7,084 | 19,018 | – – | |||||||||||||||||||||||||||||||||||
| Depreciation | 399 | 21,483 | 5,589 | 8.199 | 1,742 | 10.203 | 12,781 | 2,773 | 6,805 | 12,722 | 22,510 | 105.206 | ||||||||||||||||||||||||||||||||||||
| EBITDA | (43.505 | ) | 49,751 | 4.457 | 13,362 | 18,480 | 5.878 | 36,548 | 25,152 | 8,798 | 28,452 | 47.692 | 195.065 | |||||||||||||||||||||||||||||||||||
| Profit from the sale of stores | (100 | ) | – – | – – | – – | – – | – – | – – | – – | – – | – – | – – | (100 | ) | ||||||||||||||||||||||||||||||||||
| Other (income) expenses | – – | 1,420 | 39 | – – | 7th | (42 | ) | 931 | 154 | 9 | (38 | ) | 140 | 2,620 | ||||||||||||||||||||||||||||||||||
| Compensation of the non-controlling shareholders | – – | 2.489 | 469 | 1,156 | 29 | 634 | 1,549 | 495 | (20 | ) | 1,028 | 1.166 | 8,995 | |||||||||||||||||||||||||||||||||||
| acquisition cost | – – | – – | 2.517 | – – | – – | 2.042 | – – | – – | – – | 273 | – – | 4.832 | ||||||||||||||||||||||||||||||||||||
| Integration services fee | – – | – – | 1,125 | – – | – – | 1,000 | – – | – – | – – | – – | – – | 2.125 | ||||||||||||||||||||||||||||||||||||
| Other | 324 | – – | – – | 598 | – – | – – | – – | – – | – – | – – | – – | 922 | ||||||||||||||||||||||||||||||||||||
| Management fees | 29,402 | 1,000 | 250 | 500 | 500 | 347 | 500 | 500 | 500 | 750 | 500 | 34,749 | ||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | (13.879 | ) | $ | 54,660 | $ | 8,857 | $ | 15,616 | $ | 19,016 | $ | 9,859 | $ | 39,528 | $ | 26,301 | $ | 9.287 | $ | 30,465 | $ | 49,498 | $ | 249.208 | |||||||||||||||||||||||
| Compass Diversified Holdings | ||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | ||||||||||||||||||||||||||||||||||||||||
| (Unchecked) | ||||||||||||||||||||||||||||||||||||||||
| Fiscal year ended December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||
| Corporate | 5.11 | Ergobaby | freedom | Speed outdoors | ACI | Arnold | Foam maker | Sterno | Consolidated | |||||||||||||||||||||||||||||||
| Net income (loss) (1) | $ | 282.240 | $ | 2.059 | $ | 4.793 | $ | 3.130 | $ | (36.982 | ) | $ | 14,970 | $ | 700 | $ | 2.883 | $ | 16,447 | $ | 290.240 | |||||||||||||||||||
| Adapted for: | ||||||||||||||||||||||||||||||||||||||||
| Provision (performance) for income taxes | – – | 2.520 | 2.250 | 932 | (2.782 | ) | 3.896 | 1,280 | 1.258 | 5.388 | 14,742 | |||||||||||||||||||||||||||||
| Net interest expense | 57,980 | (24 | ) | 17th | – – | 242 | (2 | ) | (1 | ) | – – | 4th | 58.216 | |||||||||||||||||||||||||||
| Intercompany interest | (80.556 | ) | 17,567 | 3.325 | 4,364 | 11.194 | 6.543 | 6.295 | 8,635 | 22,633 | – – | |||||||||||||||||||||||||||||
| Loss on debt relief | 12,319 | – – | – – | – – | – – | – – | – – | – – | – – | 12,319 | ||||||||||||||||||||||||||||||
| Depreciation | 1,598 | 21,540 | 8,561 | 1.667 | 13,222 | 2.551 | 6.545 | 12,452 | 22,486 | 90,622 | ||||||||||||||||||||||||||||||
| EBITDA | 273,581 | 43,662 | 18,946 | 10.093 | (15, 106 | ) | 27,958 | 14,819 | 25.228 | 66,958 | 466.139 | |||||||||||||||||||||||||||||
| Profit from the sale of stores | (331.013 | ) | – – | – – | – – | – – | – – | – – | – – | – – | (331.013 | ) | ||||||||||||||||||||||||||||
| (Profit) loss from the sale of fixed assets | 92 | (122 | ) | (11 | ) | 16 | 952 | 122 | 1 | 1.247 | (112 | ) | 2.185 | |||||||||||||||||||||||||||
| Compensation of the non-controlling shareholders | – – | 2360 | 828 | (8th | ) | 322 | 288 | 56 | 1,025 | 1.183 | 6,054 | |||||||||||||||||||||||||||||
| Depreciation expense | – – | – – | – – | – – | 32,881 | – – | – – | – – | – – | 32,881 | ||||||||||||||||||||||||||||||
| Inventory adjustment | – – | – – | – – | – – | – – | – – | – – | 281 | – – | 281 | ||||||||||||||||||||||||||||||
| Adjustment to the earnout provision | – – | – – | – – | – – | 2.022 | – – | – – | – – | – – | 2.022 | ||||||||||||||||||||||||||||||
| (Profit) loss from foreign currency transactions and others | 10.193 | – – | – – | – – | – – | – – | – – | – – | – – | 10.193 | ||||||||||||||||||||||||||||||
| Integration services fee | – – | – – | – – | 266 | – – | 58 | – – | – – | – – | 324 | ||||||||||||||||||||||||||||||
| Management fees | 32,280 | 1,000 | 500 | 500 | 500 | 500 | 500 | 750 | 500 | 37.030 | ||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | (14.867 | ) | $ | 46,900 | $ | 20.263 | $ | 10,867 | $ | 21,571 | $ | 28,926 | $ | 15,376 | $ | 28,531 | $ | 68,529 | $ | 226.096 | |||||||||||||||||||
| Compass Diversified Holdings | ||||||||||||||||
| Adjusted EBITDA | ||||||||||||||||
| (unchecked) | ||||||||||||||||
| Three months to December 31st | Twelve months to December 31st | |||||||||||||||
| (in thousands) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
| Brand consumers | ||||||||||||||||
| 5.11 | $ | 18,336 | $ | 15,290 | $ | 54,660 | $ | 46,900 | ||||||||
| BOA (1) | 8,857 | – – | 8,857 | – – | ||||||||||||
| Ergobaby | 1,823 | 3,574 | 15,616 | 20.263 | ||||||||||||
| freedom | 5.105 | 3.243 | 19,016 | 10,867 | ||||||||||||
| Marucci Sports (2) | 5.244 | – – | 9,859 | – – | ||||||||||||
| Speed outdoors | 14,489 | 5.607 | 39,528 | 21,571 | ||||||||||||
| Total branded consumer | $ | 53,854 | $ | 27,714 | $ | 147,536 | $ | 99,601 | ||||||||
| Niche industry | ||||||||||||||||
| Advanced circuits | $ | 5.414 | $ | 7.521 | $ | 26,301 | $ | 28,926 | ||||||||
| Arnold Magnetics | 1,314 | 3,766 | 9.287 | 15,376 | ||||||||||||
| Foam maker | 8,454 | 5,856 | 30,465 | 28,531 | ||||||||||||
| Sterno | 14,654 | 22,010 | 49,498 | 68,529 | ||||||||||||
| Total niche industry | $ | 29,836 | $ | 39.153 | $ | 115,551 | $ | 141,362 | ||||||||
| Corporate expense (3) | (3.907 | ) | (5.185 | ) | (13.879 | ) | (14.867 | ) | ||||||||
| Total Adjusted EBITDA | $ | 79,783 | $ | 61.682 | $ | 249.208 | $ | 226.096 | ||||||||
| (1 | ) | The above results for BOA do not include management's pre-owned adjusted EBITDA estimate of $ 0.3 million and $ 24.5 million for the three months and twelve months ended December 31, 2020 and $ 7.1 million, respectively. For the three and twelve months ended December 31, 2019, BOA was acquired on October 16, 2020. | |
| (2 | ) | The above results for Marucci Sports do not include management's estimate of Adjusted EBITDA prior to our ownership of $ 3.9 million for the twelve months ended December 31, 2020 and $ 3.2 million and $ 14.2 million for the the three and twelve months ending December 31, 2019. Marucci Sports was acquired on April 20, 2020. | |
| (3 | ) | A reconciliation of our corporate expenses to net income can be found on the recently submitted Form 10-K. | |
Compass Diversified Holdings
Summary cash flow statement
(unchecked)
| Twelve months to December 31st | |||||||
| (in thousands) | 2020 | 2019 | |||||
| Cash generated from operations | $ | 148.625 | $ | 84,562 | |||
| Cash flow (used in) from investing activities | (700.834 | ) | 743.126 | ||||
| Cash flow from financing activities | 521.725 | (779,522 | ) | ||||
| Impact of foreign currency on cash | 914 | (1.178 | ) | ||||
| Net increase (decrease) in cash and cash equivalents | (29,570 | ) | 46,988 | ||||
| Cash and cash equivalents – start of the period (1) | 100.314 | 53.326 | |||||
| Cash and cash equivalents – end of period | $ | 70,744 | $ | 100.314 | |||
(1) Includes cash from discontinued operations of $ 4.6 million as of January 1, 2019.
Compass Diversified Holdings
Consolidated table of cash flows available for distribution and reinvestment
(unchecked)
| Three months to December 31st | Twelve months to December 31st | ||||||||||||||
| (in thousands) | 2020 | 2019 | 2020 | 2019 | |||||||||||
| Net income (loss) | $ | 8,780 | $ | 5.353 | $ | 27.197 | $ | 307.141 | |||||||
| Adjustments to reconcile net profit (loss) to cash flow from operating activities: | |||||||||||||||
| Depreciation | 29,174 | 22,049 | 102,752 | 100.462 | |||||||||||
| Profit from the sale of stores | – – | (810 | ) | (100 | ) | (331.013 | ) | ||||||||
| Depreciation expense | – – | (500 | ) | – – | 32,881 | ||||||||||
| Amortization of issuing costs and premium / discount | 576 | 751 | 2.232 | 3,773 | |||||||||||
| Unrealized loss from interest rate hedging | – – | 14th | – – | 3,500 | |||||||||||
| Shareholder Non-Controlling Fees | 2,879 | 1,789 | 8,995 | 7,993 | |||||||||||
| Provision for provisions | (1.565 | ) | 770 | 2,809 | 3.556 | ||||||||||
| Other | 396 | 8,478 | 2.172 | 14,438 | |||||||||||
| Deferred taxes | 2.571 | 1.662 | (781 | ) | (12.876 | ) | |||||||||
| Changes in operating assets and liabilities | (7,058 | ) | 13.423 | 3,349 | (45,293 | ) | |||||||||
| Cash generated from operations | 35.753 | 52,979 | 148,625 | 84.562 | |||||||||||
| Plus: | |||||||||||||||
| Nicht verwendete Gebühr für revolvierende Kreditfazilität | 238 | 458 | 1.386 | 1,851 | |||||||||||
| Erfolgreiche Anschaffungskosten | 2,517 | – – | 4,832 | 596 | |||||||||||
| Gebühr für Integrationsdienste (1) | 1,625 | – – | 2,125 | 281 | |||||||||||
| Realisierter Verlust aus Fremdwährungseffekt (2) | – – | – – | – – | 363 | |||||||||||
| Changes in operating assets and liabilities | 7,058 | – – | – – | 45,293 | |||||||||||
| Verlust beim Verkauf von Tilray-Wertpapieren | – – | – – | – – | 10,193 | |||||||||||
| Anpassung der Earnout-Rückstellung | – – | 2,022 | – – | 2,022 | |||||||||||
| Weniger: | |||||||||||||||
| Instandhaltungsinvestitionen (3) | 6,718 | 7,245 | 17.084 | 22.005 | |||||||||||
| Zahlung des Zinsswaps | – – | – – | – – | 675 | |||||||||||
| Changes in operating assets and liabilities | – – | 13.423 | 3,349 | – – | |||||||||||
| Vorzugsaktienausschüttungen | 6.045 | 3,781 | 23.678 | 15.125 | |||||||||||
| Andere (4) | (1,565 | ) | 1.018 | 2,211 | 3,318 | ||||||||||
| CAD | $ | 35.993 | $ | 29.992 | $ | 110,646 | $ | 104.038 | |||||||
| Ausschüttung im April 2020/2019 | $ | – – | $ | – – | $ | 21.564 | $ | 21.564 | |||||||
| Ausschüttung im Juli 2020/2019 | – – | – – | 23.364 | 21.564 | |||||||||||
| Ausschüttung im Oktober 2020/2019 | – – | – – | 23.364 | 21.564 | |||||||||||
| Ausschüttung im Januar 2021/2020 | 23.364 | 21.564 | 23.364 | 21.564 | |||||||||||
| $ | 23.364 | $ | 21.564 | $ | 91.656 | $ | 86,256 | ||||||||
(1) Stellt Gebühren dar, die von neu erworbenen Unternehmen an den Manager für Integrationsdienste gezahlt wurden, die im ersten Jahr des Eigentums erbracht wurden und vierteljährlich zu zahlen sind.
(2) Reflektiert den Gewinn / Verlust aus Fremdwährungstransaktionen, der sich aus den an Manitoba Harvest gewährten konzerninternen Darlehen in kanadischen Dollar ergibt.
(3) Stellt Wartungsinvestitionen dar, die aus dem operativen Cashflow abzüglich der Erlöse aus dem Verkauf von Sachanlagen finanziert wurden, und schließt Wachstumsinvestitionen in Höhe von ca. 4,0 Mio. USD bzw. 5,7 Mio. USD für die drei Monate zum 31. Dezember 2020 und aus 2019 und 13,7 Mio. USD bzw. 16,4 Mio. USD für die zwölf Monate zum 31. Dezember 2020 und 2019.
(4) Stellt die Auswirkung von Rückstellungen für Vorräte und Forderungen auf das Ergebnis dar.
| Compass Diversified Holdings | |||||||||||||||||
| Instandhaltungskapitalausgaben | |||||||||||||||||
| (unchecked) | |||||||||||||||||
| Three months to December 31st | Zwölf Monate bis zum 31. Dezember | ||||||||||||||||
| (in thousands) | 2020 | 2019 | 2020 | 2019 | |||||||||||||
| Markenverbraucher | |||||||||||||||||
| 5.11 | $ | 365 | $ | 696 | $ | 1,262 | $ | 2,243 | |||||||||
| Boa | 794 | – – | 794 | – – | |||||||||||||
| Ergobaby | 108 | 22nd | 482 | 605 | |||||||||||||
| Liberty | 266 | (186 | ) | 704 | 534 | ||||||||||||
| Marucci Sports | 629 | – – | 849 | – – | |||||||||||||
| Velocity Outdoor | 1,108 | 803 | 3,851 | 2,899 | |||||||||||||
| Total Branded Consumer | $ | 3,270 | $ | 1,335 | $ | 7,942 | $ | 6,281 | |||||||||
| Niche Industrial | |||||||||||||||||
| Advanced Circuits | $ | 240 | $ | 3,663 | $ | 594 | $ | 4,790 | |||||||||
| Arnold Magnetics | 2,123 | 988 | 4,884 | 3,862 | |||||||||||||
| Foam Fabricators | 769 | 359 | 2,287 | 1,746 | |||||||||||||
| Sterno Group | 316 | 899 | 1,377 | 1,831 | |||||||||||||
| Total Niche Industrial | $ | 3,448 | $ | 5,909 | $ | 9,142 | $ | 12,229 | |||||||||
| Total maintenance capital expenditures | $ | 6,718 | $ | 7,244 | $ | 17,084 | $ | 18,510 | |||||||||
Compass Diversified Holdings
Condensed Consolidated Balance Sheets
| December 31, 2020 | December 31, 2019 | ||||||
| (in thousands) | |||||||
| Vermögenswerte | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 70,744 | $ | 100,314 | |||
| Claims, net | 232,507 | 191,405 | |||||
| Stocks | 363,373 | 317,306 | |||||
| Prepaid expenses and other current assets | 41,743 | 35,247 | |||||
| Total current assets | 708,367 | 644,272 | |||||
| Property, plant and equipment, net | 172,669 | 146,428 | |||||
| Goodwill and intangible assets, net | 1,603,168 | 1,000,465 | |||||
| Other non-current assets | 114,314 | 100,727 | |||||
| Total assets | $ | 2,598,518 | $ | 1,891,892 | |||
| Liabilities and stockholders’ equity | |||||||
| Short term liabilities | |||||||
| Accounts payable and accrued expenses | $ | 253,798 | $ | 178,857 | |||
| Due to related party | 10,238 | 8,049 | |||||
| Current portion, long-term debt | – – | – – | |||||
| Other current liabilities | 30,679 | 22,573 | |||||
| Total short-term liabilities | 294,715 | 209,479 | |||||
| Deferred income taxes | 83,541 | 33,039 | |||||
| Long-term liabilities | 899,460 | 394,445 | |||||
| Other non-current liabilities | 100,654 | 89,054 | |||||
| Total liabilities | 1,378,370 | 726,017 | |||||
| Stockholders' equity | |||||||
| Total stockholders' equity attributable to Holdings | 1,100,024 | 1,115,327 | |||||
| Noncontrolling interest | 120,124 | 50,548 | |||||
| Total equity | 1,220,148 | 1,165,875 | |||||
| Total liabilities and stockholders’ equity | $ | 2,598,518 | $ | 1,891,892 | |||