Cadre Holdings, Inc. (NYSE:CDRE), a global leader in the manufacturing and distribution of safety equipment and other related products, has reported its financial results for the first quarter of 2024, showcasing impressive growth and operational excellence.

Financials

The company's net sales for the quarter reached $137,860,000, up 23.4% from the same period in the prior year. This strong performance was driven by recent acquisitions, higher demand for armor products and explosive ordnance disposal (EOD) products, as well as increased agency demand for hard goods through the company's Distribution segment. Cadre's net income for the quarter was $6,928,000, while its annual net income for the previous fiscal year was $38,641,000.

Cadre's operating cash flow for the quarter was $2,137,000, while its annual operating cash flow for the previous fiscal year was $73,209,000. The company's free cash flow for the quarter was $798,000, and its annual free cash flow for the previous fiscal year was $66,482,000.

Geographic Breakdown

In terms of geographic breakdown, the company's net sales were $108,423,000 in the United States and $29,437,000 internationally. Cadre's revenue is diversified across several key markets, including U.S. state and local agencies (54.4%), commercial (8.2%), U.S. federal agencies (15.4%), and international (21.4%).

Business Overview

The company's strong performance in the first quarter was driven by its continued focus on operational excellence and the successful integration of its recent acquisitions, ICOR Technology and Alpha Safety. Cadre's President, Brad Williams, highlighted the company's "outstanding strategic execution" and the "strong sustained demand for our mission-critical safety equipment."

Cadre's Chief Financial Officer, Blaine Browers, noted that the company's "intense focus on margin expansion continues to deliver incremental benefits," with gross margins improving 190 basis points and adjusted EBITDA margins improving 120 basis points on a sequential basis.

M&A Strategy

The company's M&A strategy remains a crucial component of its long-term growth objectives. Cadre completed the acquisitions of ICOR Technology and Alpha Safety during the first quarter, which are expected to support mission-critical initiatives and provide compelling growth opportunities. The company's pipeline of potential acquisition targets, particularly in the nuclear market, remains robust, and Cadre is committed to a patient and disciplined approach to evaluating these opportunities.

Liquidity

Cadre's balance sheet remains strong, with net debt of $128,800,000 as of March 31, 2024, and a net debt leverage ratio of 1.4 times after the recent equity offering. This provides the company with ample dry powder to continue pursuing strategic acquisitions.

Outlook

The company has reaffirmed its full-year 2024 guidance, expecting net sales to be between $553,000,000 and $572,000,000 and adjusted EBITDA to be between $104,000,000 and $108,000,000. Cadre's CEO, Warren Kanders, expressed confidence in the company's ability to capitalize on attractive opportunities and enhance its market leadership over the long term.

Conclusion

Cadre's strong first-quarter performance, successful integration of recent acquisitions, and reaffirmed guidance demonstrate the company's resilience and ability to navigate the evolving market landscape. With a focus on operational excellence, strategic M&A, and a robust pipeline of opportunities, Cadre appears well-positioned to continue delivering value for its shareholders.