NYSE$YETI

YETI Holdings Inc · Q4 2022 earnings

Q4 2022 earnings · · Investor relations

Briefing

YETI's Q4 2022 results were impacted by voluntary recalls, but adjusted sales increased by 10% driven by DTC channel and international business growth.

YETI Holdings reported a 1% increase in net sales for Q4 2022, which includes an unfavorable impact from voluntary recalls. Adjusted sales, excluding the impact of these recalls, increased by 10%. The direct-to-consumer channel showed strong growth, while the wholesale channel was impacted by later-than-planned consumer demand. Gross profit and operating income were negatively affected by the recalls, but adjusted figures showed a smaller decrease.

  • Sales increased 1% to $448.0 million, including a $38.4 million unfavorable impact from voluntary recalls; adjusted sales increased 10% to $486.4 million.
  • Direct-to-consumer (DTC) channel sales increased 17% to $309.5 million, with adjusted DTC sales up 20% excluding recall impacts.
  • Gross profit decreased 34% to $167.0 million, or 37.3% of sales, including a $97.0 million unfavorable impact from recalls.
  • Net loss was $27.7 million, or 6.2% of sales, compared to net income of $72.9 million in the prior year quarter, impacted by the voluntary recalls.

Headline financials

Total Revenue

$448M

Previous: $443M+1.1%
EPS (adj)

$0.78

Previous: $0.87-10.3%
Gross Margin

37.3%

Previous: 57.5%-35.1%
Adjusted Gross Margin

54.3%

Previous: 57.5%-5.6%
Adjusted Operating Margin

18.3%

Previous: 22.5%-18.7%
Capital Expenditures

$13.4M

Previous: $15.6M-13.7%
Free Cash Flow

$160M

Previous: $351M-54.5%
Net Income

-$27.7M

Previous: $62.4M-144.5%
Operating Income

-$43.7M

Previous: $81.4M-153.7%
Gross Profit

$167M

Previous: $225M-25.7%
Cash & Equivalents

$235M

Previous: $253M-7.3%
Total Assets

$1.08B

Previous: $737M+46.1%
Stock-Based Comp

$2.92M

Previous: $9.01M-67.6%

Revenue & EPS history

YETI · Revenue · Quarterly

$448M

Q4 2022+1.1%vs Q4 2021
Beat estimate in 11 of 15 quarters(73%)
ActualEstimate

Revenue by segment

YETI · $896M total across 5 segments · Q4 2022

  • Direct-to-consumer
    $310M+17.3%
  • Drinkware
    $308M+7.9%
  • Wholesale
    $139M-22.7%
  • Coolers & Equipment
    $131M-13.9%
  • Other
    $9.34M

Forward guidance

YETI expects adjusted sales to increase between 3% and 5% in fiscal year 2023. Adjusted operating income as a percentage of adjusted sales is expected to be between 15% and 15.5%, with adjusted operating income decreasing between 3% and 8%. Adjusted net income per diluted share is projected to be between $2.12 and $2.23, reflecting a 5% to 10% decrease.

Tailwinds

  • DTC and international businesses are expected to continue delivering strong results.
  • Positive sell-through is expected to continue at wholesale.
  • Gross margin tailwinds are expected to ramp throughout the year as lower freight costs work through inventory.
  • Strong margin expansion and bottom-line growth are expected in the fourth quarter.
  • The company anticipates to maintain its long-term growth aspirations.

Headwinds

  • Wholesale order flow is expected to be cautious during the first half of the year.
  • An estimated 500 basis point unfavorable impact is expected from the stop sale on products impacted by the proposed voluntary recalls.
  • Limited sales growth is expected throughout the first three quarters of the year.
  • Operating expenses are expected to increase as a percentage of sales to support international and DTC businesses.
  • Adjusted operating income is expected to decrease between 3% and 8%.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q4 2022

Historical avgQ4 2022

+0.5%

Avg return

Earnings day

+1.6%

Avg return

5 days after

+2.2%

Avg return

30 days after

39%

14 / 36 earnings

Positive

+44.7%

Q3 2022

Best reaction

-18.8%

Q4 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-1.8%+9.2%+31.5%
Q4 2025-4.6%-8.1%-28.2%
Q3 2025+5.3%+15.2%+29.9%
Q1 2025+6.0%+13.4%+13.0%
Q4 2024-0.9%+1.4%-15.1%
Q3 2024+7.0%+14.5%+17.5%
Q2 2024+10.7%+12.6%+0.8%
Q1 2024+14.0%+20.4%+23.6%
Q4 2023-18.8%-20.0%-23.1%
Q3 2023+4.1%+10.6%+16.6%
Q2 2023+13.5%+15.6%+19.5%
Q1 2023-5.2%-5.6%-16.7%
Q4 2022-3.5%-1.9%-1.6%
Q3 2022+44.7%+45.7%+47.2%
Q2 2022-17.3%-21.4%-34.3%
Q1 2022+3.0%+7.4%+1.6%
Q4 2021-8.0%-10.3%-5.0%
Q3 2021-5.0%+1.1%-12.8%
Q2 2021+1.6%+2.2%+0.8%
Q1 2021+8.8%+5.9%+16.6%
Q3 2020+14.3%+8.2%+22.2%
Q2 2020-2.4%-7.7%-4.1%
Q1 2020+6.7%+0.3%+31.4%
Q4 2019-5.4%-7.5%-34.1%
Q3 2019-5.2%-8.2%-8.3%
Q2 2019-12.7%-14.3%-18.7%
Q1 2018-8.9%-7.9%-22.2%
Q1 2019-7.1%-15.4%-29.5%
Q1 2017-1.9%+2.5%+11.1%
Q2 2017-1.9%+2.5%+11.1%
Q4 2016-1.9%+2.5%+11.1%
Q2 2018-1.9%+2.5%+11.1%
Q4 2018+22.4%+28.0%+59.6%
Q4 2017-8.5%-12.0%-9.3%
Q3 2017-8.5%-12.0%-9.3%
Q3 2018-12.3%-12.1%-22.8%
Q1 2016
Q1 2015

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