EDUC - Earnings call 2 2024 | Educational Development Corporation

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon, ladies and gentlemen. Welcome to the Educational Development Corporation Second Quarter Fiscal Year 2024, Earnings Conference Call. [Operator Instructions]. This call is being recorded on Thursday, October 12, 2023.

Before beginning the call, we would like to remind you that some of the statements made today will be forward-looking and are protected under the Private Securities Litigation Reform Act of 1995. materially factors. expressed differ a implied may of variety results from or those to Actual use Educational of refer for condition. We of a the filings more SEC with detailed discussion the financial Development company's Corporation's recent

would Hooser, Relations. Steven I over ahead. Investor like the Please to conference now to go turn

Steven Hooser

Thank Second for Call. Quarter us you, afternoon, for today you and Thank good Earnings Educational operator, everyone. joining Development Corporation's

www.edcpub.com. Officer; President company Chief this call the with Marketing Dan On second Sales release available Chief Cobb, its Officer; Heather afternoon, press quarter. are Financial White, me Chief is fiscal announcing Executive on and Craig closed and for at Officer. After issued and O'Keefe, market company's the the results The release today the a the website

today, make on details offer operator at will look should the statements you forward-looking company's forward-looking SEC for As the statements. that mentioned, filings and those more we

over President With the turn that, White, call Officer. Craig? Craig now Executive company's like I'd Chief to the to and

Craig White

and and Steven, general comments you, through and some update call. will then to quarter and and to start the pass sales Heather provide with welcome, I will financials Dan the Thank on run call call regarding marketing. over today's everyone, the to the an I

call Finally, XXXX outlook. on with I up will strategy wrap the comments some and fiscal

brand the quarter, partners. active which continued our impacts to sales directly be During our second inflation, impacted by high

made of January the sale that year this year partner. we brand active diminished a has a the levels and am expect second during that, effect partner joined said is I that brand this as calendar expected, see the partner of we this our current have where as end ripple before, The as either levels brand sales or I brand to indicator brand the has, to of As partners trend key them PaperPie rebrand rolled PaperPie out a quarter. every delighted future. process in in through August stabilized -- our reflects

announced We partner being previously retail Usborne Toys increase of books this sales for our by we The due vendor, decrease selling lower another stoppage distribution summer our brand starting seen this expect orders inflection Usborne Miller products. brand sales Learning division our in partially strong an in also The an were Smart in our to count agreement as Lab from customers point Under offset with and lines. wrap-ups the count to and supplied updated already head in quarter our sales this of partner to was are Publishing by Kane be have August. product distributor.

about excited We these of are retail the customers. our continued growth and new product opportunities with lines existing

but in successful, in changes generates to later additional have brand made more continues We the make talk Heather our our new also #X will PaperPie. only and partner partners brand the partners, brand be entice focus. several also to join partners further call. division that that recently not To Brand about PaperPie success

to the I will the now over of provide O'Keefe With overview a to Dan that, financials. call brief turn

Dan O'Keefe

Thank you, Craig.

second million the $XXX,XXX totaled quarter totaled after-tax Net $XXX,XXX income After-tax decrease year. XX% for results quarter quarter the $XX.X in quarter the totaled last million compared million, before active in to second in second last of Average increase of loss compared of $X.X decrease revenues a partners XX,XXX or brand $X.X a of XX,XXX fiscal million. second million, income taxes million compared Our PaperPie compared the last of to X,XXX to loss year. $XX.X quarter a XX%. or year, second $X.X of last pretax an the to to Earnings compared $X.X quarter of an year.

and August working To million to August XXXX. for the quarter basis. million on update on loss net XX, our a compared at decreased levels, per a to share Income of $XX.X capital fully $X.XX inventory inventories XXXX, XX, diluted million was per share from compared everyone $X.X $X.XX $XX.X on

Now update. for our working capital

Our the borrowings on August. at our working capital line totaled $X.X of of credit end million

the from back mortgage secured at on and XX, to maturity the August line reclassing credit with extended our company company agreement, the amended with monthly agreement, the $XX.X removed, new the line capital the credit in quarter, debt. debt long-term resulting the our million the terms XXXX, credit includes $X the agreement the charge company's agreement to covenant working the of bank. existing term at of with January of terms XXXX. the along loans ratio default fixed was During step-downs new Under of acceleration Under million XX,

to credit August, was $X to of balance million approximately increase The and in listed October. payments end processor reserve. processes hold the reserve restricted a our our August Also that began reserve increased cash cash million at is to $X is our held was and cash scheduled sheet. from our in $X.X again as during September on million The card customers to

the opportunities further concludes over Heather? and I'll turn That to in about detail. and marketing Cobb, update, Heather financial talk sales the now call to

Heather Cobb

Dan. you, Thank

earlier, brand new partners. make to Craig continue success to mentioned our As we changes bring to

In are As July, June XX-day site-wide our brand August, on and e-commerce their products appreciated our the typically for of promotions we being to opportunities we during softest selling our positive customers. summer we receiving which example, that with were the off partners to during them offered have offered commission are help an year. at spur sale implemented and month XX% offered XX%, feedback months, sales bonus to site sales. up a greatly The

shipping unchanged. change positive orders shipping our taking orders. This partners this effect of at families brand from offering customers alike. An this order types September, we well that size by Starting our promotions. rate has and in challenging unexpected received been in change to income e-commerce of changes different $XX impact flat began to charges $XX was average offering $X shipping has approximately from remained with on have our continue We strategic period when to make disposable limited free adapt

typically to of the to brand in selling promotions which our fall largest as year. business, additional assist months the especially coming out build this selling have partners period is during they roll their and season, We incentives

retail to continues new on focus and established our Our customers. opening to team accounts selling sales

stated Kane of alongside As addition momentum for and toys us Learning Wrap-up the Miller our sales has earlier, of Lab some Smart the line provided Craig lines products.

doors While Toys we into Lab not opportunity foreign the to lines with we customers. to so had doing and opening sell new have wrap-ups previously both Learning are Smart the product new countries,

sales This marketing turn update. the will to remarks. back Craig? over I concludes call closing Craig for our and

Craig White

Dan. you, Heather and Thank both.

call about changes up would like I recent some questions. to Now talk for opening before the

million funds These the employees retention the offered from part credit. government-sponsored employees of who we Act quarter, $X.X employers in during received the to funds maintained COVID. were During Cares

and reserves credit was very have primarily held positively the absorbed impacted our our infusion our been While bank quarter, paydowns by in with and with funds credit this cash card of cash our timely line processor.

paying improve focus sale and used with and down our we sale which proceeds our million, from our old for this financial continues pay to reducing overall debts term have primary this be Our excess recently down performance. expense, storage. building bank. end, for listed for loans which is to inventory used $X.X The be will our will our primarily To our interest contracted

X lease further into agreed inventory levels we back improving our have which after profitability. for consolidate reduced the building plan to headquarters, We years, our to

our be evidenced selling the of to Cash this from our credit. quarter, line continuing which quarter also are turn reduction inventory in into of cash, most in generated third step used will downs the inventory will required meet the We be strongest year. in to

as I what other option. have had some that the questions we would evaluating like, why building this we're the -- solutions don't our absolutely an of is look question current that but and you on recently sell to have meantime. may in headquarters. Hilti the We're short-term evaluating We're -- call

and During operating the levels line costs opportunity continue look reduced other every bottom we for reductions, to employee lower improve we to and performance. from quarter, cost

on be has will we a dividends for to profitability, return our plan path past This reach myself practice our and priority We Once we until our shareholders. paying shareholders. been continue to and of top to reinstate quarterly continues to this we profitability.

will and Now questions that the back operator to a of now activity, the have provided some I recent for turn over answers. we call summary

Operator

the [Operator Norcini Edward ]. comes from first line Instructions] for of [ indiscernible question Your

Edward Norcini

had because you million Dan. that Question discount Or a spoke, with time for Last $X me the believe, that? letter Has update you sent I we company conflict us a them, for the is didn't of on one conflict resolved? discount can credit. of been about

Dan O'Keefe

in Usborne of the the at of didn't year, end of credit. unresolved. -- last because Sure. Usborne disputed beginning of at letter give them January, we end December, the rebate It's the

of So the at accrual of that on that financial point, reversed we the rebate. all

a in took position the we're it our off And But so statements. hoping financial still we're for best. where we

Edward Norcini

Okay.

that stock, your $X.XX. below your at stock the somewhere today, closed stock assurance me $X happen? that falls Craig, NASDAQ stock if $X.XX, Secondly, any read Can days, for their delisted. won't XX I you be give will company's

Craig White

I? Can

Edward Norcini

[ mean Yes. indiscernible I ].

Craig White

All is What debt I with all. reduce you and to try all to back sales, can is happens to you up price we're less assure increase stock to exhausting options that profitability. return more the or

Dan O'Keefe

also split companies limit back minimum typically when will -- happen to does stock orders a it reverse and that does I'll bring to say that stock the Yes. go do Craig below and they above. their

probably -- of for happen reduce continue of time, go trading. that shares the wouldn't we an NASDAQ, number and most increase -- the action split split were to value do stock a of do reverse shareholder if and So period reverse to extended and stock and would off we

Edward Norcini

planning your in something That's book?

Dan O'Keefe

to It's Exchange. the York a do share on maintain NASDAQ If their -- what that listings below New goes price is required. reverse companies their minimum it's stock or Stock

Edward Norcini

then or that's any delisted be or the your allowed not Well, if you'd -- sell from NASDAQ, a to won't be trade buy investor we fear allowed company. Okay. of you're

credits. in that that Okay. that Good from government. that is you are auditing retention and is also That's the I free somewhere money -- air? read got you're -- the clear? it and luck, Is for they that up Or employment me. money what

Dan O'Keefe

audited, the checks bank. money deposited received indiscernible the We're[ but be fortunately, the we then and ] government's and cleared

think we've So got now. I it

Operator

comes of [ Your the Private next indiscernible Investor. line ], question from

Unknown Analyst

Yes. is October? to of close questions The sale for the A couple of leaseback in facility, you. still that quick warehouse scheduled

Craig White

that's the plan. Yes,

would minor -- to a delay closing. but need we I We issues that have resolve, to that us few don't anticipate cause there's

Unknown Analyst

that have October? brand August, and climb the trends partner in levels And Okay. those September started continued Great. in to

Dan O'Keefe

Well, not report. something it's we

is a that period reporting. August So we're

summer, in over saw uptick we So as stabilize we saw a and Craig the little August. mentioned, them

So that's through what calls. earnings our communicate we

Unknown Analyst

Right. But that's since? you can't happened discuss anything

Dan O'Keefe

active We typically partner monthly No. it's don't satisfied of with reporting trending. the count, into way brand our get We're

Operator

Randy the And R Freed comes from next LLC. from your line Capital, question of L

Randy Freed

me? can hear you Hello,

Dan O'Keefe

Randy. Yes. Yes,

Randy Freed

questions. X got I

I one retention employee Dan. The am credit for the first because with also. is familiar a I'm Dan, somewhat CPA

My if sure question. We that confident my for gentleman's to that other credit. lot audited fact, met you be -- all are that hoping on the been of But going bit you you you you audited super part to you they're little that of first don't you and back, CARES a is, got do, how question qualified know are the not question who you that to in Act. -- confident how are for able actually that. I'm claw expand to not it? criteria Or applying question? that want that's like that for confident get consulted that a is you get and you with thereby million have I So was My $X.X people

Dan O'Keefe

want a indiscernible tax we Tier advertisements be their nationally, and do we -- recognized think nobody large use they well. credits. [ processor there. and not of file to annually to I'll are nationally X believe development audited but that process. does also research only retention employment our same that we help they're the says -- our firm wants as processed for I with one -- are other firm be documentation application did But of firm they But the you. credits, very largest and consulting We us a Well, to a with use to credit process this. don't They've ] audited. concur Nobody I

Randy Freed

X seen you, do of any any shows about that can X the shares a all I on any checked for answer. for you sales or anything of you is company market haven't website you little purchases of there by Have X. really question of any but next I do sure talking shares My open the Okay. of bought in not are officers. that is There's any And you market free, get the I'm and I'm they about through not little market any open which to sort in shares free. so? of plan. plans any recently. But a the they're just you open maybe these of bought shares have confusing. X if have

Dan O'Keefe

Yes.

Form acquired that week, these buy So believe, the last shares the with shares quarter, we've identifying withholdings. the we in payroll last we filed Xs, I

they're So the bought our dollars. with market personal open in

Randy Freed

Okay.

you're few for doing that shares a buying So withholdings. every you're sort site? All at come once couple up -- site looked in of from payroll that but a those that X a few withholding? are weeks, haven't that where of all through shares payroll I on is through through while showing that

Dan O'Keefe

Yes. XXX(k) our And plan. through it's

have as We in our our option stock investment XXX(k) an plan.

And payroll we have us. for market an XXX(k) our our and our then firm have our That into those every so and when investment to And the we withholdings. option. payroll goes payroll, shares as XXX(k) company buys out plan stock period go

Randy Freed

XXX(k) of your now? the money plan open it's plans, your XXX(k) not right purchases not into you're like for some Your personal market using going own that's account, not in

Dan O'Keefe

Yes.

be me Randy. real clear, Let

dollars get putting account, paid that instead taking -- We investing and taking it bank and our are of we cash that payroll stock. cash in it we're payroll our taking that in with company that were

we buying shares our buying Yes, cash. are we So personal with are shares.

Operator

And like turn would Craig I to are no remarks. this White questions to closing back for time. there at further it

Craig White

us look of update for XXXX. appreciate our additional joining January a day. We today. to an great your and support providing Thanks, call on everyone, Have continued in forward

Operator

and Thank gentlemen. call. ladies you, concludes Thank participating. today's you This conference for

You may now disconnect.

Educational Development (EDUC) 12 Oct 232024 Q2 Earnings call transcript