Turning Point Brands Reports Strong Q2 Growth

By Bobby Samwell • Thursday, August 01 15:23 • Permanent Link

Turning Point Brands, Inc. has announced its second-quarter 2024 results, showing growth and positive momentum across various metrics.

In the second quarter of 2024, the company's adjusted EBITDA increased to $27.0 million, marking a 7% increase over the prior year. Notably, Zig-Zag and Stoker’s products net sales for Q2 2024 increased by 13% year-over-year.

The company's total consolidated net sales saw a 2.8% increase to $108.5 million. Within this, Zig-Zag products net sales rose by 8.0%, while Stoker’s products net sales increased significantly by 18.5%. However, Creative Distribution Solutions (CDS) net sales decreased by 33.0%.

Gross profit also showed positive movement, increasing by 2.6% to $53.8 million. Net income grew by 31.0% to $13.0 million, and adjusted net income saw a 12.2% increase to $17.2 million. Additionally, diluted EPS stood at $0.68, with adjusted diluted EPS at $0.89, compared to $0.53 and $0.79, respectively, in the same period one year ago.

The President and CEO of Turning Point Brands, Graham Purdy, expressed satisfaction with the second-quarter results, highlighting the achievement of the highest quarterly EBITDA since the second quarter of 2021. He also mentioned the sustainable growth trajectory of Zig-Zag and the continued market share growth of Stoker’s MST.

For the Zig-Zag products segment, net sales increased by 8.0% to $50.5 million, driven by solid performance in the North American papers & wraps businesses as well as growth in cigars. On the other hand, the Stoker’s products segment saw a substantial 18.5% increase in net sales to $42.7 million, driven by high teens growth from MST and triple-digit growth for FRE.

Looking at the full-year 2024 outlook, the company has increased its adjusted EBITDA guidance to $98 to $102 million, excluding CDS.

The press release also noted that total gross debt as of June 30, 2024, was $368.5 million, while net debt (total gross debt less unrestricted cash) was $226.4 million. The company ended the quarter with total liquidity of $201.0 million.

The market has reacted to these announcements by moving the company's shares 0.4% to a price of $37.85. For more information, read the company's full 8-K submission here.

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