NASDAQ$KRT

Karat Packaging Inc · Q4 2021 earnings

Q4 2021 earnings · · Investor relations

Briefing

Reported record fourth quarter net sales and continued margin expansion.

Karat Packaging, Inc. reported strong Q4 2021 results with a 30% increase in net sales to $91.3 million and a gross margin increase of 360 basis points to 31%. The company achieved $10.9 million in adjusted EBITDA, representing an 11.9% adjusted EBITDA margin. Looking ahead, Karat Packaging is targeting net sales for Q1 2022 to be in the range of $101 million to $103 million, and expects full-year 2022 sales to grow 17% to 19% over 2021.

  • Net sales for the fourth quarter increased 30% year-over-year to $91.3 million.
  • Online sales posted the highest percentage increase, up 56% year-over-year.
  • Gross margin increased 360 basis points to 31% over the same quarter last year.
  • Net income increased more than threefold to $6 million.

Headline financials

Total Revenue

$91.3M

Previous: $70.4M+29.8%
EPS (adj)

$0.32

Previous: $0.06+433.3%
Adjusted EBITDA Margin

11.9%

Previous: 6.4%+85.9%
Capital Expenditures

$228K

Previous: $1.92M-88.1%
Free Cash Flow

$9.7M

Previous: $332K+2820.8%
Net Income

$6M

Previous: $922K+550.8%
Operating Income

$7.1M

Previous: $2.06M+245.2%
Gross Profit

$28.3M

Previous: $19.3M+46.7%
Cash & Equivalents

$6.48M

Previous: $448K+1347.1%
Total Assets

$208M

Previous: $181M+14.6%
Stock-Based Comp

$938K

No prior period

Revenue & EPS history

Karat Packaging · Revenue · Quarterly

$91.3M

Q4 2021+29.8%vs Q4 2020
Beat estimate in 3 of 7 quarters(43%)
ActualEstimate

Revenue by segment

Karat Packaging · $82.1M total across 3 segments · Q3 2023

  • Chains and distributors
    $61M-4.0%
  • Online
    $14.3M+1.6%
  • Retail
    $6.81M-19.3%

Forward guidance

Karat Packaging is targeting net sales for the first quarter of 2022 to be in the range of $101 million to $103 million, representing approximately 35% growth at the midpoint of the range compared to the same period last year. For the full year 2022, the company expects sales to grow 17% to 19% over 2021.

Tailwinds

  • Targeting net sales for Q1 2022 to be in the range of $101 million to $103 million, up about 35% at the midpoint
  • Expect sales to grow 17% to 19% over 2021 for the full 2022 year
  • Food service sector is continuing to experience steady increase in consumer spending
  • Demand for environmentally friendly products continue to grow
  • Leased 14 trucks and trailers to expand third-party logistics services

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 Q4 2021

Historical avgQ4 2021

-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

Earnings price reactions
QuarterReport dateReaction (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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