Krispy Kreme Inc Reports Q2 2024 Financial Results

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Krispy Kreme, Inc. Reports Q2 2024 Financial Results

Krispy Kreme, Inc. (NASDAQ: DNUT) reported its financial results for the quarter ended June 30, 2024.

Key Financial Metrics

Metric Q2 2024 Q2 2023 Year-over-Year Growth Consensus Estimate
Net Revenue $438.8 million $408.9 million +7.3% $435.49 million (Beat)
Organic Revenue $440.2 million (Implicit) +7.8% N/A
GAAP Net Loss -$4.9 million $0.1 million - N/A
Adjusted EBITDA $54.7 million $48.8 million +12.1% N/A
Adjusted EBITDA Margin (%) 12.5% 11.9% +60 bps N/A
Adjusted Net Income, Diluted $9.1 million $11.4 million -20.1% N/A
Adjusted Diluted EPS $0.05 $0.07 -28.6% $0.05 (Meet)

Krispy Kreme recorded a solid quarter with a 7.3% year-over-year increase in net revenue, surpassing the consensus estimate. The company achieved significant growth in organic revenue and Adjusted EBITDA, despite a GAAP net loss and a decline in Adjusted Net Income, Diluted.

Segment Revenue Performance

Segment Q2 2024 Revenue Q2 2023 Revenue Year-over-Year Growth Organic Revenue Growth Adjusted EBITDA Adjusted EBITDA Margin
U.S. $289.5 million $267.6 million +8.2% +8.4% $32.7 million 11.3% (+80 bps)
International $124.7 million $120.0 million +3.9% +5.0% $21.7 million 17.3% (-320 bps)
Market Development $25.3 million $21.8 million +16.1% +16.1% $12.9 million 53.1% (+280 bps)

In the U.S. segment, strong performance was driven by innovative specialty doughnut collections, yielding an 8.2% increase in net revenue. The international segment saw moderate growth boosted by marketing activations, though this was offset by softer transaction volumes in the UK. Meanwhile, the Market Development segment experienced robust growth fueled by greater equipment sales.

Operational Data

Metric Q2 2024 Q2 2023 Growth
Global Points of Access (POA) 15,853 12,872 +23.2%
Delivered Fresh Daily Sales Growth 24% Not provided Not provided
Digital Sales Growth 26% Not provided Not provided

Key operational highlights include a 23.2% increase in Global Points of Access to 15,853, along with significant growth in Delivered Fresh Daily and digital sales.

Management Comments

CEO Josh Charlesworth highlighted the quarter's success, attributing it to the increasing availability and accessibility of Krispy Kreme's fresh doughnuts globally. The company also emphasized its continued expansion in new markets and the strategic sale of a majority stake in Insomnia Cookies to focus more effectively on its core operations.

Forward Guidance

Krispy Kreme updated its 2024 financial guidance as follows: - Net Revenue: $1,650 to $1,685 million - Organic Revenue Growth: +5% to +7% - Adjusted EBITDA: $215 to $220 million - Adjusted Diluted EPS: $0.24 to $0.28 - Income Tax Rate: 28% to 30% - Capital Expenditures: 7% to 8% of net revenue - Interest Expense, net: $55 million to $60 million

The company expects net leverage to trend towards 3.5x by year end.

Stock Price Movement

Following the earnings release, Krispy Kreme's stock price rose by 0.93%.

Overall, Krispy Kreme demonstrated solid revenue growth and operational improvements, despite a GAAP net loss and slight dips in some metrics, positioning itself well for future expansion and profitability.

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