UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _______________________________________________________________________________________________________________________________________________________________________________________________________ FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE A ...

Hamilton Beach Brands Company (HBB) Q1 2025 Earnings Call April 30, 2025 04:30 PM ET Speaker0 Thank you for standing by. At this time, I would like to welcome everyone to today's Hamilton Beach Brands First Quarter twenty twenty five Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a Q and A session. So without further ado, I would like to turn the call over to Brendan Frey, partner with ICR. Brendan, you have the floor. ...

CONTACT: Brendon Frey Brendon.frey@icrinc.com HAMILTON BEACH BRANDS HOLDING COMPANY ANNOUNCES FIRST QUARTER 2025 RESULTS Revenue Increased 4.0% to $133.4 Million Gross Margin Expanded 120 Basis Points to 24.6% Cash Flow from Operations was $6.6 Million Glen Allen, Virginia - Hamilton Beach Brands Holding Company (NYSE: HBB) (The Company) today announced results for the first quarter of 2025. First Quarter 2025 Overview "Our first quarter results reflect solid improvement over last year even in the face of s ...

Revenue Increased 4.0% to $133.4 MillionGross Margin Expanded 120 Basis Points to 24.6%Cash Flow from Operations was $6.6 MillionGLEN ALLEN, Va., April 30, 2025 /PRNewswire/ -- Hamilton Beach Brands Holding Company (NYSE: HBB) (The Company) today announced results for the first quarter of 2025.First Quarter 2025 Overview Revenue increased 4.0% to $133.4 million compared to $128.3 million Gross margin increased 120 basis points to 24.6% compared to 23.4% Operating profit increased to $2.3 million compared to ...

Group 1 - Hamilton Beach Brands (NYSE: HBB) is identified as a small firm with a market capitalization that is currently being considered for an upgrade [1] - The focus of Crude Value Insights is on cash flow and companies that generate it, highlighting value and growth prospects in the oil and natural gas sector [1] Group 2 - Subscribers to the service gain access to a 50+ stock model account and in-depth cash flow analyses of exploration and production (E&P) firms [2] - The service includes live chat discussions about the oil and gas sector, enhancing community engagement and information sharing [2]

Core Viewpoint - Hamilton Beach Brands Holding Company (HBB) has demonstrated strong financial performance in Q4 2024, with significant stock gains and a solid outlook for 2025, driven by revenue growth, improved gross margins, and strategic market expansions [1][17]. Revenue & Earnings Performance - HBB reported quarterly earnings per diluted share of $1.75, a 25% increase from $1.40 in Q4 2023 [2]. - Revenues for Q4 2024 reached $213.5 million, reflecting a 3.3% year-over-year increase from $206.7 million, attributed to higher volume and a favorable product mix [2]. - The gross margin for the quarter declined by 70 basis points to 26.1% from 26.8% in the prior-year quarter, but for the full year, it expanded by 300 basis points to 26%, marking a record high since HBB became a public entity in 2017 [3]. Profitability Metrics - Operating profit for Q4 declined 5.7% to $23.6 million from $25 million in the prior-year period, while net income rose 22.6% to $24 million from $19.6 million, primarily due to a foreign tax benefit [4]. - Operating cash flow for the year was $65.4 million, down from $88.6 million in 2023, with working capital contributing $14.5 million compared to $49.5 million in the previous year [5]. Expenses and Debt Management - SG&A expenses increased to $32.1 million in Q4 from $30.2 million in Q4 2023, driven by HealthBeacon acquisition costs [6]. - At the end of 2024, HBB reported a net cash position of $0.6 million, a significant improvement from a net debt of $34.6 million at the end of 2023 [7]. Management Insights - The CEO highlighted the achievement of financial targets despite a competitive market, attributing success to expansion into underserved markets and innovation [8]. - HBB gained market share in the U.S. and international markets, particularly in Mexico, where it became the third-largest small appliance brand [9]. Market Performance Factors - Revenue growth was supported by higher volumes in North America, particularly in the U.S. consumer market, while the Global Commercial segment faced slight declines [10]. - The February 2024 acquisition of HealthBeacon contributed $1.7 million to Q4 revenues and $4.3 million for the year [10]. Future Outlook - HBB expects the small kitchen appliance retail market to grow in the low-single-digit range in 2025, with the company anticipating mid-single-digit revenue growth [12]. - Operating profit is expected to rise faster than revenues, benefiting from operating leverage and a decrease in HealthBeacon-related SG&A expenses [13]. - The company aims to mitigate tariff impacts on 75% of its products by the end of 2025 through price increases and supplier concessions [14]. Strategic Developments - HBB is expanding into the healthcare sector through the integration of HealthBeacon, focusing on scaling its remote therapeutic monitoring system [15]. - The company has diversified its sourcing strategy to reduce reliance on China, mitigating sourcing risk for 35% of its business by the end of 2024, with plans to extend this to 75% by the end of 2025 [16].

Financial Data and Key Metrics Changes - Total revenue in Q4 2024 was $213.5 million, a 3.3% increase compared to Q4 2023, driven by a favorable product mix and higher volume, partially offset by average price decreases and foreign currency impacts [35] - Gross profit was $55.8 million in Q4 2024, compared to $55.3 million in the same period last year, with a gross profit margin of 26.1%, down from 26.8% [36][37] - For the full year 2024, net revenue increased 4.6% to $654.7 million, gross margin increased by 300 basis points to 26%, and operating profit increased 23.1% to $43.2 million [40][41] Business Line Data and Key Metrics Changes - The U.S. consumer business grew 3.6% in 2024, outpacing the overall market, while the Mexico and Latin America business saw even greater growth [14] - The HealthBeacon acquisition contributed $1.7 million in revenue during Q4 2024 [35] - The commercial business segment saw significant growth, highlighted by a 50% increase in sales of the Summit Edge blender [22] Market Data and Key Metrics Changes - The North American consumer markets delivered solid growth, particularly in the U.S., while international revenue experienced declines [35] - The small kitchen appliance retail market is expected to grow in the low single-digit range in 2025, with the company expecting to modestly outperform this growth [49] Company Strategy and Development Direction - The company is focused on six strategic initiatives aimed at long-term growth, including core growth, premium market share, global commercial leadership, health segment acceleration, digital transformation, and leveraging partnerships [12] - Plans for 2025 include expanding premium product offerings and increasing marketing investments to support growth initiatives [29][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in entering 2025 with solid momentum and a robust pipeline of new products, particularly in high-growth categories like specialty coffee and air fryers [28] - The company has taken proactive steps to mitigate tariff impacts, achieving a 35% mitigation by year-end 2024 and aiming for an additional 25% to 35% in 2025 [31][50] Other Important Information - The company returned over 65% of its 2024 net income to shareholders through share repurchases and dividends [42] - The net cash position at year-end 2024 was $600,000, a significant improvement from a net debt position of $34.6 million at the end of 2023 [46] Q&A Session Summary Question: What are the expectations for revenue growth in 2025? - The company expects revenue growth approaching the mid-single-digit range, modestly outperforming the industry [49] Question: How is the company addressing tariff impacts? - The company has mitigated 35% of its products against tariffs and plans to increase this to 75% in 2025 through price increases and supplier concessions [50]

Revenue and Profitability - Revenue for 2024 was $654.7 million, a 4.6% increase from $625.6 million in 2023, primarily driven by increased unit volume and a favorable product mix [140]. - Gross profit margin improved to 26.0% in 2024 from 23.0% in 2023, attributed to lower product and transportation costs [141]. - Net income increased by 21.9% to $30.8 million in 2024, compared to $25.2 million in 2023, with an effective tax rate dropping to 7.8% from 20.4% [140][146]. Expenses - Selling, general and administrative expenses rose by $18.3 million to $126.7 million, largely due to HealthBeacon expenses and increased employee-related costs [143]. Cash Flow and Liquidity - Cash and cash equivalents increased to $45.6 million in 2024 from $15.4 million in 2023, indicating improved liquidity [148]. - Net cash provided by operating activities was $65.4 million in 2024, down from $88.6 million in 2023, reflecting a normalization post-pandemic [154]. Debt and Financing - Interest expense decreased significantly by 79.6% to $0.6 million due to lower average borrowings and interest rates [144]. - The HBB Facility was amended to extend the term to December 2029, with a reduced credit facility of $125 million and an optional $25 million term loan [157]. - As of December 31, 2024, the excess availability under the HBB Facility was $57.3 million, with outstanding borrowings of $50.0 million [158]. - As of December 31, 2024, the weighted average interest rate applicable to the HBB Facility was 2.50% [160]. - The HBB Facility requires a fee of 0.20% per annum on the unused commitment [160]. - Total contractual cash obligations amount to $354,514,000, with $249,329,000 due in 2025 [165]. - A 0.25% increase in the Base Rate would increase estimated total annual interest payments on the HBB Facility by approximately $600,000 [165]. - HBB does not expect to make voluntary repayments under the HBB Facility in the next twelve months [163]. - HBB maintains compliance with all applicable financial covenants in the HBB Facility as of December 31, 2024 [162]. Financial Instruments - The fair value of interest rate swap agreements was a receivable of $4.0 million as of December 31, 2024 [174]. - A hypothetical 10% relative decrease in interest rates would decrease the fair value of interest rate swap agreements by $200,000 [174]. - The fair value of foreign currency exchange contracts was a net receivable of $800,000 as of December 31, 2024 [177]. - Assuming a hypothetical 10% weakening of the U.S. dollar, the fair value of foreign currency-sensitive financial instruments would decrease by $1.2 million [177]. Acquisition Impact - The acquisition of HealthBeacon contributed $4.3 million in revenue for 2024, adding a new revenue stream [140].

Revenue and Growth - Revenue for 2024 increased by 4.6% to $654.7 million compared to $625.6 million[3] - Fourth quarter revenue rose by 3.3% to $213.5 million compared to $206.7 million[3] - The acquisition of HealthBeacon contributed $4.3 million in revenue for the full year 2024[9] - The company expects revenue growth in 2025 to approach the mid-single digit range[17] Profitability - Full year gross margin expanded by 300 basis points to 26.0% compared to 23.0%[10] - Operating profit for the full year increased by 23.1% to $43.2 million compared to $35.1 million[12] - Net income for the full year was $30.8 million, or $2.20 per diluted share, compared to $25.2 million, or $1.80 per diluted share[13] - Net income for 2024 was $30,759,000, up from $25,242,000 in 2023, reflecting a year-over-year increase of 21.5%[27] Cash Flow and Liquidity - Cash flow from operations for 2024 was $65.4 million, down from $88.6 million in 2023[14] - Cash and cash equivalents rose significantly to $45,644,000 in 2024, compared to $15,370,000 in 2023, marking an increase of 197.5%[27] - Net cash provided by operating activities was $65,415,000 in 2024, compared to $88,636,000 in 2023, a decrease of 26.1%[27] - The company reported a net (cash) debt of $(0.6) million in 2024, down from $34.6 million in 2023, indicating a strong cash position[28] Expenses and Liabilities - SG&A expenses for the full year increased to $126.7 million, driven by HealthBeacon expenses and higher employee-related costs[11] - Total liabilities increased to $249,164,000 in 2024 from $237,435,000 in 2023, a rise of 4.0%[25] - Total debt at year-end 2024 was $50.0 million, with a net cash position of $0.6 million[15] Assets and Equity - Total assets increased to $415,067,000 in 2024 from $384,702,000 in 2023, representing a growth of 7.5%[25] - Stockholders' equity grew to $165,903,000 in 2024, up from $147,267,000 in 2023, indicating an increase of 12.7%[25] Other Financial Activities - The company made an acquisition in 2024, resulting in a cash outflow of $7,412,000[27] - Cash dividends paid increased slightly to $6,294,000 in 2024 from $6,082,000 in 2023, reflecting a growth of 3.5%[27] - Trade receivables decreased to $117,068,000 in 2024 from $135,434,000 in 2023, a decline of 13.5%[25]

Group 1 - Hamilton Beach Brands Holding Company will release its 2024 fourth quarter and full year financial results on February 26, 2025, after market close [1] - A conference call to discuss the results will be held on the same day at 4:30 p.m. Eastern Time, with a toll-free number provided for participants [1] - The conference call will be available via live webcast on the company's website, with an archive accessible later [1] Group 2 - Hamilton Beach Brands is a leading designer, marketer, and distributor of small electric household appliances and commercial products [2] - The company owns several consumer brands, including Hamilton Beach®, Proctor Silex®, and Hamilton Beach Professional®, among others [2] - In February 2024, Hamilton Beach Health acquired HealthBeacon, a medical technology firm focused on connected devices, expanding its presence in the home health market [2]