CDRE - Earnings call 3 2021 | Cadre Holdings, Inc.

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Operator

Good afternoon, and welcome to the Cadre Holdings Third Quarter 2021 Conference Call. Today's call is being recorded.

[Operator Instructions] At this time, I would like to turn the call over to Matt Booklet of the IGB Group for introductions and the reading of the safe harbor statement. Please go ahead, sir.

Unknown Attendee

Before we begin, I'd like to remind everyone that during today's call, we will be making several forward-looking statements, and we make these statements under the safe harbor provisions of the Private Securities Litigation Reform Act.

our information and known reflect our based statements of understanding to forward-looking best assumptions estimates on These us today. are and which statements that forward-looking subject risks the These and face Cage operate. the we in industries to uncertainties

We Cadre's filings encourage risk and for and these SEC uncertainties. on you today's information release review factors to press more

time, Please website include supplementary this with evening and would at a measures. that of I comments Cadre's have financial CEO, Warren presentation posted turn over we note Kanders. to w.Cadre-holdings.com also materials our non-GAAP reconciliation the on like to and this At call Chairman

Warren Kanders

Thank by you. company. afternoon, welcome. President our and our public pleased Officer, I first Cadre's to I am very Good Brad here Browers. Williams; on be a Financial and call Chief am joined as Blaine be conference also proud to

With an accelerate and completion seek organically to cash Brad. call which and achieved ability manner, to free about disciplined recent important generate storied I IPO, significant back Cadre's milestone in while flows acquisition growth, over we over the a and we history, of our company's years, now XX excited dates turn continuing margins. will our the successful our are to in both expand very to through

Brad Williams

And today. Warren. you you, thank our call joining Thank all first earnings for

a have lot We of information to review.

brief Q&A Slide So in, session. a with Cadre today's of On X. on close we'll about I'll with call, and right recent our agenda then a dive provide overview just our financial talk cover highlights, starting performance

to our If QX Slide you and cover I'll highlights. go X, year-to-date

cash on results demand. free with X-month large to our again in that significant gross growing well and record of ongoing which positions our track results. quarterly sales, and markets in was our an and generate strong as driving as expansion, recurring believe developed strong while capitalizing has impressive Cadre flow. We adjusted margin ability our leading our entrance success demonstrated and once increasing highlight

Cadre's on margins during build expanded We success points continue improving quarter XXX adjusted to basis comps. We a challenging margins. of

adjusted I'd margins XXX CapEx period, flow, on results. and our point X-month strong thing our expanded evident the out points. One generate also basis quarter was we in to cash For free model, EBITDA X-month third which is that low based like

enables deploy to long-term This shareholder create us effectively to capital value.

mentioned, products. advantage Warren with we November, combined our public our we has believe our positions completed strong flow mission-critical of As demand balance our Cadre's tailwinds attractive free initial -- which the responder that for and to is offering first take cash free us strengthened sheet in driving

will focus organically pipeline discuss which accelerating a through later will on expansion, the acquisition growth Our be robust as through call. as on we well international

per implemented As of program approach, part on basis. $X.XX regular disciplined quarterly to per dividend share pleased share a $X.XX or allocation we're annualized also an our capital have of cash

payment will of of December to as first of or to on close declaration X future subject Cadre's be The of made business the record holders the Directors. X of Board November XX. dividend and on is company's December discretion I'm dividend any sorry, the

mission public, of subscribe-ability and of as going an for to since I'd X is overview responders. equipment call this Since like first on distribution safety and in first leader Slide Cadre's and manufacturing our provide the a position

lives. save is Our mission together, we

end special extends to The mission the channel associates just our lives of but customers. in our and and minds hearts not partners

was life-threatening recognize to years saves survive up set We that wearing first our products. ago we many call Club have using responders or which what situations the

per about year. averaging We XX sales X,XXX states. We're have currently

friends with live families a about some their So if you that think and every to that to and their to approximately equates minute, X women get in day. minor lives home

we protected are known products. X on disposal duty slide, BodyArmor, essential We're and an earned proud highly where responders this market product than company segment have the which significant that has life-threatening with holsters we of explosive our where serve like equipment over product consists established EOD in ourselves are to situations. And XX,XXX our agencies base of innovative as body. lastly, where each main innovative and life-saving the or show gear ordinance differentiate we ourselves We comfortable categories safety in blast diversified human on share in that for countries. the federal thought with customer category. XXX leaders effects We're and a first on more

and the discuss attractive for now Slide products. to Moving demand mission-critical Cadre's visibility tailwinds X. We driving

Our largest market enforcement. law segment is

the and budgets see can enforcement XX you recessions. left major financial grown years. the over past despite on of have industrial side domestic law As this slide,

side expenditures. financial believe and protection drivers our we the not On can industrial of did during products you as expenditures demonstrates police the through right which demand And for significant cycles. decline the the see, recessions, mission-critical slide economic also is

equipment customers first spending, prioritizing towards When responder their keep to lean and safety survivability safe.

supply there the date, chain disruptions. as in downward Omicron To variant business ongoing developments. is material due any experienced we've result While our thus the far uncertainty some not a and trends these emergence to of of

recurring for predictable demand wear tear, products characteristics market over of now to of technological Slide of end advancements, users protection provide error, products Since highlight with call refresh turn a combination Browers. revenue cycles accessories over I'll our Blaine a and the our business tailwinds in based XX% our for the results foundation expiration well as segment cycles. over stringent CFO, and and solid safety products. recurring room for of warranties our mission-critical standards, stream. create and drivers new demand demand them to such those limiter on our the on we Moving with as X, characteristics as around frequent recurring Blaine?

Blaine Browers

Thank Brad. you,

to X going Slide and XX. we're So

results detailed scenario. a lower in the growth and have performed, year-to-date higher both business and growth we how has Here

margin was you compare on growth. and about if XX%. line First, top X% we achieved Slide XXXX, as X% XX, illustrated EBITDA about up Both is grew

results in very environment. So growth lower strong that

expanding expand stronger X% Increasing we as XX% EBITDA much versus of XXXX gross Next, to organically. we growth, the sales look carry, XXXX XX%. margin, comparable achieved period X-month the and

over point I'd Slide a In conversion. conversion XX%. period, bottom make at just around of EBITDA looking right on that the to was like chart X-month the adjusted EBITDA the So

very generating we're our a, cash low X% significant have business, of seasonality annually. about with in don't in proud cash flow. CapEx generation our a needs, from we perspective revenue of success importantly, Also very and more free So

Next slide, Slide on XX.

Here, the we have our pro structure, forma capital before IPO. and both after

as under well loan So as third And mentioned revolving portion entered to also, of outstanding in and of a a existing used we we million loan results, revolving loan the debt pay down loan. proceeds as as new down debt We term quarter. $XX.X term the paid the our a into in planned.

was history approach. a significant X terms, take a about businesses net grow asset-light importantly, provides acquiring, flexibility very and optimizing organically do to free acquisitions. and flow post-IPO more which X/XX forma through reduced have pro with leverage high integrating successful of inorganically to a targeted models We financial Our and cash

buckets. really in X acquisitions about We think

first The is current markets, in so bucket expansion. new core in geographic products

products, second The markets outside expanding law bucket bucket is really markets. our is current the think of our and military core portfolio it then about enforcement really new current we of and and final safety products

fire, industrial instance, EMS safety. for So and

over to to going Brad concluding comments. I'm back turn for Now it

Brad Williams

Blaine. Thanks,

Warren's cash back rich us and flow we have put together the open that questions, creating point value well of strong recurring the brand see generating to to proven shareholder and dating business. trusted I Before track in history With that XXXX, our we call the a out record products we while growth position free margins. for to that great expanding great opportunity a in mission-critical I have want accelerate are team demand.

survivability positions entrenched is in safety and company Our to product large other as expand we globally. pursue segments in markets

In optimizing terms we businesses. with integrating of approach an have growth, actively which active past diligent success and is on consistent and our and robust accelerating pipeline, team acquiring, working our

quarterly have forward the cash lines for and business to for continuing dividend capital the that, initiation have please to the of and shareholders future. open up about the extremely we to our significant Finally, generated policy. to look We operator, are Q&A. execute excited pleased with With are to begun shareholders in returning reinvest regular

Operator

[Operator Instructions]

with The first from Stifel. Subin question Bert comes

Bert Subin

on quarter. first Congrats public your

challenges the when your about XXXX, violet pretty But and you murder do balance both rate you Or worse, were a think situation rate do goes next in labor those into getting get For the 'XX, most spend product officers lines How you question, in there enforcement my which that general crime products on is -- year? across law think demand crime safety items first substantially. been Is you there's in into across spent up industries. recruiting new first?

Blaine Browers

All I right, question. it. got a think I it's great

lot of recruiting and there of the think it's a things I out -- one, When our in Bert, where and on focused, be during think the customer will of be are I COVID great at police, there officers a because be you frame look there'll So X on terms time retirements question. base.

out law of today. and officers enforcement there's really the less lot were feet street lost, there a So on

be see terms recruitment you'll duties. place. go they recruitments in outfit So as will funds, the their to of those that officers into have take daily after place, But they taking

go it spent it be they on look don't to funds streets. have I and as equip or X as officers the at they'll a So other at the their look as on to both

Bert Subin

X%. X% to stretch pay finite. let's if just wondering I'm form the have budgets about elaborate budgets to how on a think of guess going spend to are of But maybe terms guess just and to bit. more that balanced I officers, somewhat that up I equation? in have meant in it. it say, are They're you you I getting police

Blaine Browers

products the Well, folks. is the years, noncritical to equation going they safety will think for deprioritize and typically survivability crunches, it products prioritize, I that when I seen their always it's protect products the We've point overall. goes, there over either budget way towards when

Warren Kanders

need through and police a so going to see, will this the need there's we're you paid But for trend cities And trained and we you better, Bert, I and major need frankly, policing quite more spending look they the to think we've be a as on they will show. country, at seen more. think if here the they're longer-term road actually went up be need will They to across during I -- on. equipped. be to better with that

right we fit to now. question seeing and from there. to other the that to from this. of belief, It's That's come going in going come are from? money we right And the so come And where support our areas is

Bert Subin

into to helpful. sort the you segues to the you opportunity Can what release, highlight accelerate and the that? That's you're noted you of focused greatest on earnings growth mean very perhaps that I headwind which Warren, maybe my just as follow-up, in then see that organically. seeking greatest

Warren Kanders

Yes.

police have time. been of So I the think departments the in really, period decimated us, opportunity of it's this for terms that equipping over

we coming we're more see numbers just previously, Yes, internationally. we through. So under-indexed as talked about

about talked we've As growth there. know, and our you market high shares are quite aspirations our previously domestically,

But internationally, just have this again, we talked month we are so expect when we signed expand closed acquisition year. a looking that. after the roadshow, to had and during We about are to under-indexed and the of specific beginning the we that

support optimistic And very -- longer-term but that about macro our we're business. trends support the to

think a outstanding manufacture top as us stay challenging In working others today, well and to employees, and an on rates terms And wage I by that hard have to that but for headwinds, it. employees as led address are challenging. folks been of domestically, are of have that management good team Brad of lot -- we hiring

do think is through with working so to they that manufacturing that, and opportunities Coupled we work are that something lean continuing on. -- But about.

labor have to greening but in opportunities not improve our may margins. pay outs more on to you continue though certain and to our so markets cross be through actually there for maintain only they even and will So

Bert Subin

helpful. very That's

I because question. it. final you my Blake mentioned Just think Blaine it's probably for -- for

the the X is see M&A X of different about buckets over pipeline, you answer as at most near run? your talked that term? You for do which attractive look you those And long

Blaine Browers

Bert. question, Great Yes.

execution as kind of for products, attractive you on kind for maybe you focus attractive expansion -- is about geographic the can execution. and probably most current maybe really and talk new think let's part us of and maybe markets take think I team. easier of the the The as about out ease

the that. I mentioned same I it in order goes probably think

and So we markets, and the have in out expertise, markets, the the core users just second those markets. to again, those being new products, expanding we decision-makers portfolio current have or but the the because in we're know-how reaching

agnostic diversify. third that's about a model So we reason. strongly And gives right? one, markets, market, different the It to thing end leveraging the management, different safety feel in in us really the products end more attractive opportunity really model is it's for really on and operating improvement an daily very in operating one

of rest the and Warren in markets and main myself the and variety Brad between And end experiences. of

amount both in just Danaher, vast with or of end right IXbackground, work GE a Brad So now different with markets. IR

outside core our markets to confident very as of execute in well. we're ability So the

Operator

comes Jeff Sinderen next The from question B. Riley. Van with

Jeff Van Sinderen

of on update project? particularly around can you And congratulations each blast what per is then main the the what you but each say me out more for color project? share margins. And speak strong wondering and let the the se, can break when you really sensor outlook then product you for I First, should expect we to if Sensor last categories you're on any milestone the and next the of know And it in any those? guess, seeing I give don't about us

Warren Kanders

to take you of and off? take Brad, blast to or want do sense on up do want you it you kind me start

Brad Williams

I'll take last sensor. you Yes. and the take want margin Yes, the to

Warren Kanders

I were question, Jeff. appreciate And Jeff, think I the you --

So thank you.

kind EOD, kind here what seeing? or you're think talking I we're in about duty of of boom

Jeff Van Sinderen

Right.

Warren Kanders

Okay. Yes.

So very price to done here out the solid. a we're really have cost for the a been internally. business, commercially see really fourth We've great with signs quarter, job -- the going and so The in positive or that started of has happy happy certainly the some both we BODYARMOR, demand forward. side of But that demand executing and been to -- perspective, productivity. just margin see on both when kind teams execution on

through -- the replenishment, stores period. to a of steady level different of will whether tends gear state, it's the a the kind Duty it more

that done have reducing job has times. the due on done both products facilities produce lead team great the a So past

the a we as we And as project of of kind prior bit spending. to of holiday little certainly they a in enter look And the come -- more for for kind but business, uptick EOD, an season, holiday expected years much then year. really

of really first But of kind been any weakening we've haven't we from continue signs seen as really or the half it's expected.

the and the So we've months of to X been year first the coming in very pleased months. forward looking

Jeff Van Sinderen

then the on Great. Okay. And ahead anything sorry. -- go

Brad Williams

other one to I cover questions any on for going just sensor? was say blasts had the I you if Blaine before that

Jeff Van Sinderen

sensor. would jump the great No, you on can no. if be It blast

Brad Williams

Yes, appreciate that. absolutely. I

today. you I'll we're So where at give

additional the talked in X okay? testing is that's testing about roadshow out underway that we're happening. So that we've that Phase III for that's X much that for except and pretty Phase with ongoing, is the moved was delivered of awarded so phase Phase been

we'll So that's ahead awarded. Phase to major additional at II additional X, on some time looking XXXX X be that this in X potential milestone towards. that we working but next also III, then we're frame. in Phase There's also have in time. that a has Phase Phase But that be information any and which There's award, would for been don't an our for point additional milestones February

Jeff Van Sinderen

Okay.

So -- then we should ahead. go sorry,

Warren Kanders

circle Sorry, I back was to going something. on

Jeff Van Sinderen

it sounded hopefully? announce-able Is to February. no, something Oh, then we was just probably ask, going like in should something that hear I

Warren Kanders

additional X final the X be Phase looked will that started added and that, originally X, phase courses phase, now say a because out project has as and special at or won't X. Phase I the No. and with this

that additional frame. So will Phase if idea as that the on the phase of which next project Phase information get soon will X will extend in time time deliverable us X give as the frame February beyond be we X, an

what for deliverable Phase X which which to in those with telling timing. the there's X February us like, is going milestones, will So look overall Phase really help the X and then X us is and

Jeff Van Sinderen

Okay. Got it.

Brad Williams

kind comes ask, just Jeff, and but of mind, that bit a -- of is certainly, well. as little I everyone's pricing on and kind circle You it's of fact, in supply on And chain inflation the think didn't which from

brand supply we a make region I the think mentioned lot outside on goods. of it, the source don't chain where the

or general, to this which So major insulated up is we've in supply shortages, great. point, been any from chain material

not flow, what Now hard but to the of our the headlines. make material certainly we of very the key obviously are working see teams in with kind have suppliers you some sure

inflation. you think that. ahead Kind don't seeing job in just have We're say the fantastic off I component don't lot inflation, of singles coast headlines. times done ship what goods critical in high it's I'll But not seen stuck of of we've of teens. some We price teams a the around a the on the and see have second in California. getting

-- that are we're as of the from inflation we So seeing results. coming some in, seen it margins able ahead and of stay expand to you've kind as

more you, find to bit want little Jeff. just I for So out a

Jeff Van Sinderen

helpful. been really just then quick a acquisition you've I knows that's follow-up No, on. everyone Okay. think on working And the

in when terms might of of more terms in wondering the you closing metrics? timing of and that share the Just

Brad Williams

Sure.

we're -- this laid in the right acquisition Chehalis, in strategy certainly that's acquisition. looking about we're boxes, for So all fits it, out not excited an very we if

working management here on of So expect very and in the with the owners the this then before year. of the very morning, next end early really sign actually close the very, weeks call coming closely, are to year, frankly, the

further we little the much of also brings excited to little Very we're down opportunity to very -- just I looking leverage get think tools what share bit path, the a Jeff, before. the core the the as about not that the kind forward about a more business. that. but we've But talked business about it and to bit going

Operator

comes The next Gesuale Raymond from question Brian with James.

Brian Gesuale

the bit about of I a out margins. gate to maybe talk start good a on Congrats here. wanted little

a trajectory get. few couple over basis next You seems had last to hundred still of the fantastic years. over few It a the really years there's points like

pick your you But X overall just to You give don't the time years? next, over how X, know, get frame, might mentioned a X, little bit we us with XX% pricing. inflation bridge maybe to and I can the

Blaine Browers

Yes.

in think X really buckets. comes I it So

continued We're material that very price brand marketplace. our products, expansion of gap premier names, there. right very proud The the versus value first inflation and sticky in of being kind the really

material So there. confident we've of done it continue on do to it more pricing kind the can we form

the to piece to leverage really down our The ability comes second model.

So view continuous right, continue the grow little as that. to we've the of which how more importantly, every that right? we our and little business, to little talked think a bit to a I you just we a take the bit more out And bit of same leverage rate, improvement is the SG&A cost footprint, the if looking cost structure the a day, better and doesn't at about lot grow teams our of that's will, but business, serve, a

get it's So growth, flow XXX% we margin that EBITDA. as margin, organic certainly that and not to volume between comes, going but through in

And then team job is just of productivity of the is productivity. doing leg something there cost always a final robust really great a And having around projects. of really funnel that's out the

a -- month And you every And and little always you off we're bit months better, redesigns project knock rolling just in, the let's automation to pull that new this get one have going next to the from to XX of project, it's everything right? products.

of kind of feel over we're years, progress made really we lot that of that certainly strong innings kind and think we've in on that's the how model side. early a about And So and it. past operating productivity

Brian Gesuale

to opportunities. some helpful. growth of about That's Great. wanted then talk And maybe I the

think grew beyond then opportunities Can to Warren Are forward? there federal the blast versus for past in give should mentioned you federal business. we being also how that going about as sensor international And us get a overweight growth the program? a domestic a And You sense how built underpenetrated. vector maybe has this sized fantastically quarter? international

Brad Williams

first to one? that, do the take the I'll of Blaine, you and second take want part

Blaine Browers

back mind. you the Yes, And you don't why on started. circle first I'll if part, get don't

Brad Williams

Okay. All right.

the some And about this show. about road piece. talked in talk the let's So federal we

business today the products So we category. predominantly globally, Bonds we leader are do and business have our Inge our market that Med in in with federal

of categories. like product other have In additional in that -- terms going today But terms share then business have in federal more of additional we BodyArmor business federal and within other sale. after we

profiles roadshow I've every while area the segment not a before like either bit. quite on margin here market don't at just an that, we federal it the that about or It's of time talked been looked just overall. we've We

the at we're we we're So I opportunities happy we that go type today from think find terms after of the space, perspective, percentage those. high-margin a have we'll within federal in as federal pockets with pretty where of

Blaine Browers

circling question, Perfect. back revenue a And year, This last very, part $X kind had the strong Brian, did the year. first of is a million. to $XX.X in over little quarter. million of very International We

growth and XX% year-on-year. about the strength the the team of to which they're So speaks just products.

mentioned this we tough of On little the year. side, earlier bit domestic a comps

were a if crowd So the demand rewound to last we on that kind control is of around year the tough you comp you things that significant driving had make of X side business.

business, really the piece commercial the us, for that's the is And which -- side second And of holsters.

were holsters So buying buying guns, these products. buying folks out they're and our

international. very very, strong the So

Brian Gesuale

really into? just it Yes, deal you than in, this then cash So capacity. What's M&A.? for fairly one I'll to that's jump different rhythm the nice we obviously, I And want The the for generates should And flow. like. sounds the to have free and we your what queue. cadence into be business a But would capacity one then good get having if is one a company? future sneak going deal last such could close soon. closing How might

Warren Kanders

Yes.

offering, think, to cetera. it's year. And on X think -- we it product acquisitions really very I as Brian size, is going a capacity location, X about many So be et to

to I'm execute management to past, and So our talking I'm talking kind ability those. of and digest capacity really the of kind

on multiples, size also high we million which on a this it the -- cash basis. flow, to M&A on the generation. which undrawn, processing the out and go-forward gives as is revolver, we'll free good of plenty do approaches a those $XXX capacity time point us of model the and the at deal be we're a able very side, you So focused that cash cash of certainly kind just flow through from depending had Then free amount is

Brad Williams

one add the question that thing more me you let asked. to Brian, federal

that answer the space. was side more some organic -- the some are M&A to things, of back it tying bring in but of we're looking of around M&A. my that There at kind potential there us federal would the are to So

feel we're I that And into free to type sure we're we higher the like the make M&A at the obviously, it fit cash flow would side like just margins added be we digging of view high those your would looking as margin, what and those how opportunities, on want desire? M&A federal I within profile question.

Operator

next ROTH Matt comes Koranda question with The Capital. from

Matt Koranda

I'll pretty add start my in could, Maybe Distro. as strong. If margins a on I a congratulations IPO the noticed year-over-year we'll despite we up well. revenue basis. softness on on little year-over-year bit of

So talk if are profile on wondering anything you maybe play note? could sustainable about go-forward some there. the dynamics then in that a to at just basis? is And how distro mix margin

Blaine Browers

Yes.

both The side we distribution that the just a team that the in, to right? So good through. flush That suppliers and goods the does of new making have work quite of ship, a world. pent-up as able not suppliers, avenues pricing for on anything around see kind bit which deliver, key we're manufacturer the element relying produce a certainly to now, job like brings on we'll right is So side revenue the -- of backlog product

primarily think I contracts. the more are some So susceptible that fixed of areas the on really are Laporte

walk So And on talking issue my say retail cans. or you I don't much the the small that folks as is for have count we're pricing them. there. boots into fairly

business. pricing the a small of basis economy a term, pretty on it's portion around would that to go-forward more have be little the pressure So where but the area a you a

be matters give changes So a any ton exposure Mix us to or seen the either it significant we haven't of but detrimental would certainly year-to-year that business. there. doesn't incremental

Matt Koranda

sounds on more wondered few by run then a Okay. it's could you That's end to And close likely year. helpful. if the of It pending the the acquisition. through details just like

for terms benefit Is of sort accretive maybe So to the of just on just average? size, of call, your the margins? folks corporate it in

it Any All to helpful. on detail of would guys the that just pay and of pipeline. be on kind the sort on are to looking range of just multiples compares that thoughts super you overall how multiple

we kind out And that then Are to synergies of synergies into or overlay just maybe there some commercial 'XX? should could thread you that expect get we some if in operating this expected. can of

Blaine Browers

Sure.

with you near-term until about sharing to, little as about of more on with starting the maybe But that you more already we kind about get So think, a more about it. process excited I hear now. We're in hold the bit of acquisition. we're sharing kind going further it as

next be hopefully, able in weeks, on So here more the shed that. we'll a of little couple to light

As far today. because about foothold which core to a the have is new we the where in it as synergies, we first it's core that accretive and or opportunity expansion, us it talked were it market, product very bucket, that to the expand -- kind is And gives sit excited. of products, markets really geographic our

We have a commercial presence in that market already.

product footprint in that natural So there's have that don't us that particular manufacturing region. we currently some for synergies there. It a also gives

kind some of local. there's local really opportunity to make for So

current world and at new obviously, rates savings attractive. kind a significant much it's world the And freight now would that freight, certainly before more been today, have environment. it's with where the even today's in of in

product. multiples it by differently as see far Auto, very As we

we've high-singles. what kind understand a looking looking is in the little ability not go to business, of and value, and about think of really return that's how if most duty here, shared the how just more kind where of for In do at the business a markets, really well. what's And we the mid-singles. cases, on the the kind deep of outside industrialize in seeing investment capital. kind you deliver kind is, And where structured, us, we opportunities. core really time important for BodyArmor going all kind of those lot being you're as the into kind is singles you spend we of teens they that our move So they're do have things of high then before of Then as more our you're

to on have great deal, invested view deal good everyone a the multiple that a growth difference But our right? return to avenues like And M&A is deliver making for certainly capital on that going deal and in there's great else. is us, value

is a really we C that's just we how we we world is day, but expand and we better do target and how we that investment. it's EBITDA focus on and and plan, where A that's run, margins A, approach returns have bit those looking we a to in see we as And we run be better, deliver at business and where we because lay it live a on great to how so even opportunities to significant can little on do the this make better and really it got company, that B, in we're look we acquire every is our not believe we well but cord it again, can B, particular at continue can

Matt Koranda

obviously Just next I identified comfortably quick, guys near-term one you one just I last a is, mature think is size. real end in the could could pipeline, pretty mean, X have year a of robust do opportunity you for I this you the year that large the probably how one, closes throw if depends guess, after and to on mentioned do, of kind X you and

quarter. clip could Does the as expect mean one another should you first as that soon off we

us of talk us set expectations Just level on and And timing leverage. to just then there? lastly, about kind

probably all be in sort like a you'd acquisition? can up we obviously, leverage everything major and against close any mean, to comfortable I -- range But too of that. bump of sort far those. to post covenants What's want Any that on read like don't

Blaine Browers

Yes.

it stores right? bit It's because finding of or at always where through. right aligns looked out time right? looked and Warren and timing goes of you've kind is some of out, hasn't been couple of control, M&A the works Everything businesses and deal the has is kind the right and it So a difficult a of great experience and times they've our at

want caveat first just kind I part. So to kind of that of

I think of it's to thinking would I a what's as QX we're say timing. next, QX probably more about

we little if forward. something of expected. to regularly, say of quicker. for this kind that longer, things internally kind I'd very summertime a played targets But and We talked be more kind little sometimes things as of bit moving with realistic both bit a out take

Matt Koranda

And on leverage... then the just

Brad Williams

I cover But that mind, here sum mentioned all to that's Matt we're to other keep X% show. target acquisitions year, of mean, the Blake only doing. Blaine, to just is add have we per the in X% what do not The just be I thing would we'll force not we the at road in and but that that,

extends to got a the have it are meets some we've mean, side things. We us our I backgrounds and our that also make of M&A the operating disciplined criteria sure we we about talk and and about at that how companies, operate that lot how around into specific world-class model of and M&A.

sure forward. sure all to just this that here those move continue make aligned that mind, in keep things that to that great we're we're make got have. to do So to capital those we we've to And stewards of double

Matt Koranda

Great think just Excellent, front, yet. helpful. on point. I it don't heard you've then very And if the but maybe addressed I sorry leverage that,

Blaine Browers

No. No, we have it.

bit up go I as the little it to we but I to think think maybe comfortable that, not X, we're right? at down, above back So quick M&A, work Longer plan with would term, look we much to a

or is generate, things business of with leveraging will paying down one deals and to we're cash great the we that's our that very free cash not generation, cash that the with we and these we're about quickly flow utilizing able delever. debt And pay --

Operator

Mark Capital. question Smith next Street comes Lake with from The

Mark Smith

of last that looking? any just the for in we areas me, kind multiples Any on M&A. of staying months as that you're off of seen change couple in out look at you've First the there

Blaine Browers

No. no. any I didn't change. see

Mark Smith

at then of gear of typical organic you growth. And question just addressable total to where outside of market we the me domestic you for as next opportunities think in maybe due what in law kind talk about look Can in your and about expansion kind share we growth? there just Okay. have is opportunities enforcement

Brad Williams

one. take that can I Yes,

So Mark, enforcement, feel high alluded within our that within law is as to, category. like we you already share

at and our innovate strategy about the segment. side like within that segment. So to law enforcement that that many for look maintain years we've just that within share really you holsters, of market many, is the continue Outside segment, it's when to done consumer to

side been put we The is would it or things. because of the resources, our consumer R&D us marketing that's segment for whatever an of most enforcement all always afterthought law resources into whether or the around over has years really

and roadshow, the selling segmented like and plus in So we get in product segment outside holster our we engineers R&D the so more team side about engineering to begin consumer talked the commercial and waste that an standpoint. we and our added focus that team inside have we'll so things of expand can from

Operator

questions this time. additional registered There at are no

closing conference remarks. pass Brad So to for Williams I'll the

Brad Williams

All operator. Operator? joining interest call Really like overall. that. appreciate Cadre. this right. first call you, appreciate thank your everyone on for us everyone joining today's earnings for and Really in I'd again to Thank continued

Operator

your Thank you. Quarter participation. for Cadre Holdings Call. Conference That concludes XXXX Thank Third you the

now your lines. may You disconnect

Cadre (CDRE) 2 Dec 212021 Q3 Earnings call transcript