Q4 2024 Waldencast PLC Earnings Call Transcript
Key Points
- Waldencast PLC (WALD) reported a robust 29.4% increase in net revenue for the fourth quarter, driven by strong performance across its brands.
- Milk Makeup experienced a significant growth of 31.9% in the quarter, supported by channel expansion and a successful launch into 600 Ulta Beauty locations.
- Obagi Medical delivered a 27.7% increase in comparable net revenue, fueled by accelerated performance in the US physician-dispensed and e-commerce channels.
- The company's adjusted EBITDA doubled to $11.2 million in the fourth quarter, with a notable margin expansion of 530 basis points year over year.
- Waldencast PLC (WALD) secured a new $205 million five-year credit facility, providing greater financial flexibility and extending its debt maturity profile through 2030.
- The first quarter of 2025 is expected to be relatively flat due to the anniversary of a successful product launch and inventory adjustments by retail partners.
- The company is currently using a significant portion of its cash to cover non-recurring expenses associated with an ongoing regulatory investigation.
- Adjusted gross margin for Obagi Medical contracted by 130 basis points in the fourth quarter due to planned reductions to drive future operational efficiency.
- There is a natural level of cannibalization expected between Ulta and Sephora as Milk Makeup expands its distribution, which may impact short-term sales.
- The macroeconomic environment remains challenging, with normalization in the beauty market affecting retail inventory levels and consumer spending patterns.
Greetings. Welcome to the Waldencast fourth quarter and fiscal year 2024 earnings call. (Operator Instructions)
As a reminder, this conference is being recorded. At this time, it's now my pleasure to introduce Allison Malkin with Investor Relations. Thank you. Allison, you may now begin.
Thank you, and welcome to the Waldencast PLC fourth quarter and fiscal year 2024 earnings call. Here with me today are Michel Brousset, Founder and Chief Executive Officer; and then Manuel Manfredi, Chief Financial Officer.
For today's call, Michel will begin with an update on our business envision and discuss the company's performance within the context of the beauty market. Manuel will follow with a review of the fourth quarter and four-year performance and provide our fiscal 2025 outlook. Following this, Michel will share the strategic growth initiatives for our Milk Makeup and Obagi Medical brands. After the prepared remarks, the operator will open the call to take questions.
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