Q4 2024 K-Bro Linen Inc Earnings Call Transcript
Key Points
- K-Bro Linen Inc (KBRLF) reported record revenue of $374 million and adjusted EBITDA of $72.1 million for 2024, reflecting a 16% increase in consolidated revenue compared to 2023.
- The company achieved a 30% increase in Hospitality revenue and a 6% increase in Healthcare revenue, demonstrating strong performance across both segments.
- Strategic acquisitions, such as Shortridge, have contributed significantly to growth, with the UK division's adjusted EBITDA margin increasing from 15.7% in 2023 to 19.8% in 2024.
- K-Bro Linen Inc (KBRLF) maintains a strong balance sheet with ample liquidity, including an undrawn balance of $46.2 million on its operating line and a debt-to-EBITDA ratio of 2.2 times.
- The company is focused on sustainable practices and has a positive outlook for 2025, with expectations of steady growth in both Healthcare and Hospitality segments.
- Net earnings as a percentage of revenue decreased by 0.5% to 5% in 2024 from 5.5% in 2023, indicating a slight decline in profitability.
- Wages and benefits increased by $18.8 million, impacting overall costs, although they decreased as a percentage of revenue.
- The Canadian division experienced a slight decrease in EBITDA margin from 18.5% in 2023 to 18.1% in 2024, primarily due to higher syndication and transition costs.
- Corporate costs increased by $4.8 million, driven by transition and transaction costs related to acquisitions and credit facility syndication.
- The company faces potential uncertainties related to geopolitical and trade landscapes, although no immediate impacts are expected.
Good morning, ladies and gentlemen, and welcome to the K-Bro Linen Systems, Inc., fourth quarter 2024 results conference call. (Operator Instructions) Also note that this call is being recorded on March 21, 2025.
And now, I would like to turn the conference over to Kristie Plaquin. Please go ahead.
Thank you, operator, and good morning, everyone. Thank you for joining us today, and welcome to our fourth-quarter results conference call. On the line with me today is Linda McCurdy, President and Chief Executive Officer. Following our remarks today, we will open it up for questions.
Before I begin, I'd like to remind everyone that statements made during our prepared remarks or in the Q&A portion of the conference call with reference to management's expectations or our predictions of the future are forward-looking statements. All statements made today, which are not statements of historical fact, are considered to be forward-looking statements. Certain material factors or assumptions
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