NASDAQ$KRT
Karat Packaging Inc · Q2 2024 earnings
Q2 2024 earnings · · Investor relations
Briefing
Karat Packaging's financial performance modestly improved with increased net sales and gross profit, but experienced a decrease in net income and adjusted EBITDA compared to the prior-year quarter.
Karat Packaging Inc. reported a 3.5% increase in net sales to $112.6 million and a 3.7% increase in gross profit to $43.4 million for the second quarter of 2024. However, net income decreased to $9.2 million from $10.7 million in the prior-year quarter, and adjusted EBITDA decreased to $15.7 million from $21.1 million in the prior-year quarter. The company's gross margin remained steady at 38.5%.
- Net sales increased by 3.5% to $112.6 million compared to the prior-year quarter.
- Gross profit rose by 3.7% to $43.4 million, maintaining a gross margin of 38.5%.
- Net income decreased to $9.2 million, with a net income margin of 8.2%.
- Adjusted EBITDA was $15.7 million, representing a margin of 13.9%.
Headline financials
Revenue & EPS history
Karat Packaging · Revenue · Quarterly
$113M
Revenue by segment
Karat Packaging · $82.1M total across 3 segments · Q3 2023
- Chains and distributors$61M-4.0%74.3%
- Online$14.3M+1.6%17.4%
- Retail$6.81M-19.3%8.3%
Forward guidance
The company anticipates net sales to increase by mid to high single digits for the third quarter of 2024 and expects a gross margin of 38 to 39 percent. For the full year 2024, net sales are projected to increase by mid-single digits, with a gross margin goal of 38 to 40 percent.
Tailwinds
- Net sales for Q3 2024 are expected to increase by mid to high single digits.
- Gross margin for Q3 2024 is expected to be 38 to 39 percent.
- Net sales for the full year 2024 are expected to increase by mid-single digits.
- Gross margin goal for the full year 2024 is expected to be 38 to 40 percent.
- Business pipeline continues to expand with new national and regional chain accounts.
Headwinds
- Initiation of certain new orders took longer than anticipated due to administrative set-up procedures at larger chain accounts.
- Softer demand was experienced in certain categories.
- Significantly higher ocean freight costs impacted gross margin.
- Operating income in the 2024 second quarter decreased to $11.1 million, from $13.3 million in the prior-year quarter, primarily due to an increase in operating expenses of $3.8 million, partially offset by an increase in gross profit of $1.5 million.
- Adjusted EBITDA decreased to $15.7 million for the 2024 second quarter, compared with $21.1 million for the prior-year quarter.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 20 quarterly earnings reports · overlaid with Q2 2024
-0.7%
Avg return
Earnings day
+1.2%
Avg return
5 days after
+0.8%
Avg return
30 days after
42%
10 / 24 earnings
Positive
+20.7%
Q4 2025
Best reaction
-18.6%
Q3 2023
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q1 2026 | -7.5% | -10.4% | -6.3% | |
| Q4 2025 | +20.7% | +24.4% | +33.5% | |
| Q3 2025 | -6.1% | -8.5% | -8.5% | |
| Q1 2025 | +10.9% | +10.0% | +14.2% | |
| Q4 2024 | -2.1% | +0.8% | -14.7% | |
| Q3 2024 | -0.1% | +3.5% | +5.3% | |
| Q2 2024 | -14.6% | -7.8% | -13.2% | |
| Q1 2024 | -9.0% | -5.2% | -7.7% | |
| Q4 2023 | -11.8% | -7.2% | -5.7% | |
| Q3 2023 | -18.6% | -9.2% | -5.5% | |
| Q2 2023 | +3.8% | +21.6% | +0.8% | |
| Q1 2023 | +3.6% | +6.2% | +12.5% | |
| Q4 2022 | -1.6% | -6.6% | -6.2% | |
| Q3 2022 | -2.8% | -7.6% | -5.8% | |
| Q2 2022 | +1.2% | +0.1% | +1.2% | |
| Q1 2022 | +11.6% | +16.7% | +10.0% | |
| Q4 2021 | +13.3% | +26.2% | +24.5% | |
| Q3 2020 | -10.6% | -10.8% | -9.7% | |
| Q3 2021 | -7.5% | -7.8% | -7.6% | |
| Q2 2020 | -3.7% | -6.5% | -6.1% | |
| Q2 2021 | -2.6% | -7.6% | -6.2% | |
| Q4 2020 | +6.1% | +3.7% | +6.2% | |
| Q1 2020 | +6.1% | +3.7% | +6.2% | |
| Q1 2021 | +3.5% | +8.2% | +8.2% | |
| Q4 2019 | — | — | — | |
| Q3 2019 | — | — | — | |
| Q2 2019 | — | — | — | |
| Q1 2019 | — | — | — | |
| Q4 2018 | — | — | — | |
| Q2 2018 | — | — | — | |
| Q1 2018 | — | — | — | |
| Q4 2017 | — | — | — |
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