NASDAQ$HYFM
Hydrofarm Holdings Group Inc. · Q1 2023 earnings
Q1 2023 earnings · · Investor relations
Briefing
Hydrofarm's financial performance declined due to industry oversupply, but restructuring efforts led to improved gross profit margin and reduced SG&A expenses.
Hydrofarm Holdings Group reported a decrease in net sales to $62.2 million, driven by a decline in volume and price/mix of products sold. Despite the sales decrease, the gross profit margin increased to 18.3%, and the company's net loss improved to $(16.8) million. The company reaffirms its full year 2023 outlook, expecting net sales between $290 million and $310 million and positive Free Cash Flow.
- Net sales decreased to $62.2 million compared to $111.4 million year-over-year.
- Gross profit decreased to $11.4 million, but gross profit margin increased to 18.3%.
- Net loss improved to $(16.8) million, or $(0.37) per diluted share, compared to $(23.3) million, or $(0.52) per diluted share, in the prior year period.
- Adjusted EBITDA decreased to $(2.1) million compared to $3.1 million in the prior year period.
Headline financials
Revenue & EPS history
Hydrofarm · Revenue · Quarterly
$62.2M
Forward guidance
The Company is reaffirming its full year 2023 outlook, expecting net sales between $290 million and $310 million and positive Free Cash Flow.
Tailwinds
- Net sales of approximately $290 million to $310 million.
- Adjusted EBITDA that is modestly positive for the full year.
- Free Cash Flow that is positive for the full year.
- Improved year-over-year Adjusted Gross Profit and Adjusted Gross Profit margin.
- Capital expenditures of approximately $7 million to $9 million.
Headwinds
- The Company now expects results to be toward the low end of the net sales range.
- The market in which we operate has been substantially adversely impacted by industry conditions, including oversupply and decreasing prices of the products the Company's end customers sell.
- If industry conditions worsen or are sustained for a lengthy period, we could be forced to take additional impairment charges and/or inventory and accounts receivable reserves, which could be substantial, and, ultimately, we may face liquidity challenges.
- The ongoing COVID-19 pandemic could have a material adverse effect on the Company’s business, results of operation, financial condition and/or cash flows.
- Interruptions in the Company's supply chain, whether due to COVID-19 or otherwise could adversely impact expected sales growth and operations.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 18 quarterly earnings reports · overlaid with Q1 2023
-2.6%
Avg return
Earnings day
-4.3%
Avg return
5 days after
-7.5%
Avg return
30 days after
38%
10 / 26 earnings
Positive
+16.2%
Q4 2020
Best reaction
-22.7%
Q2 2023
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q4 2025 | -0.9% | -1.8% | — | |
| Q1 2026 | -6.5% | -10.3% | -13.8% | |
| Q3 2025 | -14.6% | -21.9% | -3.0% | |
| Q2 2025 | -2.9% | +0.0% | -28.4% | |
| Q1 2025 | +8.0% | -1.9% | -0.9% | |
| Q4 2024 | -20.9% | -26.8% | -61.2% | |
| Q3 2024 | -4.9% | -2.7% | +13.8% | |
| Q2 2024 | +1.9% | +0.0% | +14.4% | |
| Q1 2024 | -3.7% | -10.2% | -14.2% | |
| Q4 2023 | +7.0% | -2.1% | +25.6% | |
| Q3 2023 | +4.4% | +0.0% | +25.9% | |
| Q2 2023 | -22.7% | -22.4% | -4.0% | |
| Q1 2023 | -8.7% | -15.0% | -22.6% | |
| Q4 2022 | +15.9% | +18.5% | -6.0% | |
| Q3 2022 | +8.2% | +19.7% | -1.7% | |
| Q2 2022 | +14.2% | +30.5% | +2.7% | |
| Q1 2022 | -20.8% | +1.9% | -34.3% | |
| Q4 2021 | -14.9% | -28.5% | -25.2% | |
| Q4 2019 | -14.9% | -28.5% | -25.2% | |
| Q3 2020 | -1.4% | -10.7% | -40.4% | |
| Q3 2021 | +12.3% | +10.8% | -28.2% | |
| Q2 2020 | -11.7% | -8.2% | +12.1% | |
| Q2 2021 | -5.6% | -16.6% | +5.7% | |
| Q1 2020 | +4.1% | +3.3% | +0.3% | |
| Q1 2021 | -3.6% | -0.3% | -4.7% | |
| Q4 2020 | +16.2% | +10.8% | +26.3% | |
| Q3 2019 | — | — | — | |
| Q2 2019 | — | — | — | |
| Q1 2019 | — | — | — |
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