GIC - Earnings call transcript Q3 2024 | Global Industrial Company

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Operator

Good afternoon, ladies and gentlemen, and welcome to Global Industrial's Third Quarter 2024 Earnings Call. At this time, I would like to turn the floor over to Mike Smargiassi of The Plunkett Group. Sir, please go ahead.

Mike Smargiassi

Thank you, and welcome to the Global Industrial Third Quarter 2024 Earnings Call. Leading today's call will be Richard Leeds, Executive Chairman and Interim CEO; and Tex Clark, Senior Vice President and Chief Financial Officer.

followed question-and-answer be will remarks by session. a Formal

factors, forward-looking should differ forward-looking be discussion number from may the that statements It certain include of a a Risk to could Today's website XX-Q. caption understood and Form under Factors Industrial statements. actual projected the is due available release those report under including described those Form in the materially and company's XX-K press is with call on This Company. filed quarterly the X-K. The and company's the annual SEC Global been on reports on Form of has results on property

I will over to turn call Richard. the now

Richard Leeds

thank Thanks, us. for joining Mike. everyone, Good and you afternoon,

in customer the SMB a compared in our We year saw Our each behavior was up purchasing base. X.X% core for quarter, demand quarter third reflects softness the customer cautious performance the period and month weak ago down as quarter. throughout the period. Revenue the continued environment to and

Our continues to delivering well, strategic account business solid growth. perform

In to sales, and freight but in remained XX% across Gross satisfaction improvement healthy. cost rates increased we customer our ocean was base quarter, as continue a sequentially customer year-over-year margin declined an on primarily basis from face of the retention headwinds. addition,

growth. has performance have since my to experience, it's terrific a role, engagement line and on our strong to initiatives, web further strengthen we platform that reflecting growth reflects will long-term returned and customer Bottom observations drive help talented investments position. the a and across clear drive CRM foundation specifically key in business that a new I competitive team CEO a And

to at areas rather and excel results where However, what At we're we we down exceptional customer segment key with every times, to the and to identified market. are for we cater on disappointed improvement. deliver value than doubling have recent trying

the and long-term do. our have We and more certain to seek sharper and to BXB specifically need over-indexing with renewed build. resulted of on serving are with implementing relationships on that a between unifying sales know customers in transactional focus we customer a not more collaboration, the We're acquisition addition, needs segments aligned addressing marketing. we us and this decisions core what In new

adjusting engage identify, accounts the our communicate proposition We highest target to allow the our our better we're Further, to core process to nurture segments. believe value with potential. focus to customer refined strengths market, and and lifetime this established play us will value

and product the also in continue brands exclusive experience we oriented key by offering capabilities. and our which These customer offering. our are that more attributes knowledge, and improving We end-to-end customers, to technically believe differentiators highlighting are will enhance solution with our web shopping align

we been of the we During unified customers' live and to our building operations. a rollout the provide operational go of third this CRM and past expect have several phased CRM a will new the term. started picture quarter, strengthen customer drive more In experience, efficiencies the in our of seamless near environment. quarters, believe new delivery Salesforce We

tool market-leading to strong enjoy scores, exceptional can satisfaction to and a ensure is to to experience an deliver continue We customer customers. we Salesforce continue our

takes their vendor to solutions we we associates to I'd terrific broad all August, work a together for to event like is that amount Industrial our Vegas. opportunity Las the National customers This our gain offering and an insights customers. In Trade produce product of Show like Annual market our direct in held and brings It Global and provides It to of incredible efforts. successful this. bring show a from partners. our thank an excellent showcased

excited is management Lisa customers. with and brings us She her brand August and a exceptional in expertise efforts BXB to connections drive the and go-to-market enhance welcome strategy, Finally, awareness I'm team. our I in joined our senior would marketing. to support CMO Lisa as strengthen to proven Armstrong to executive, like our

opportunities. macro environment continue enhancing believe on on our driving a and I balance while gain a traction. invest quarters sheet, in we performance, our And to position we'll customers our customer continue efforts to conclusion, core we'll experience. the take drive In offerings including be to an strong few our remains market drivers excellence as to in evaluate challenged, to the growth and operational improves, focus and exceptional our financial the control, focus will and factors product environment do they the target in strategic maintain

over to Tex. will turn call I the now

Thomas Clark

you, Thank Richard.

X.X% revenue was down $XXX.X U.S. local X.X% million, X.X% currency. in year. revenue last revenue was quarter down Third down over QX of Canada was and

Our end customer markets. revenue across softness was broad-based

currently in enterprise headwinds the our remainder an neutrality expect new penetration. We the on half year. of first continued pricing generation account and as generally We growth of saw the for neutral see was price account we it both in quarter, Price improvement the the the continued capitalizes business strong to year. from in third existing

seen digits. and the down demand continue environment currently into mid-single have the quarter We pacing is fourth soft revenue

quarter up as of initiatives. margin from and reflect was result million, ago margin of year key promotion period, the this remains from basis basis margin our last as we costs. XXX a of sequential Management quarter of elevated gross the basis, flat benefit price was strategic Gross will pricing profit On from points competitive profile impact Performance ocean freight the Gross was for management. our benefited points, actions as primarily a XXX of year. $XXX.X part muted was continue proactive down focus. area a as XX%, freight to

for spending generated top basis administrative and primarily results. negative in sales XXX last CPC from and reflected soft planned investment of initiatives of growth inflation. significant well distribution to key points increase XX.X% as an year. leverage This the net or sales, line SD&A million, the marketing as $XX.X quarter due was Selling,

we addition, quarter. costs, health care significant a in In had million $X exceeded the in increase which

in will XQ, which current to elevated result remain in revenue due to leverage levels SD&A expect negative We trends. the

amortization cost flow from of from continuing control operations discretionary the was third $XX.X income $X.X continuing cash and Operating quarter, margin in management. in operating disciplined operations general million was and X.X%. was Operating the our remain We million in the million, the capital with depreciation quarter. including while of were was associated million. expense related the Indoff approximately in $X acquisition, $X.X intangible the to expenditures Total $X.X amortization assets quarter million and

We investments expect $X primarily our of XXXX distribution maintenance-related to capital equipment in network. the $X range includes within million expenditures million, which and

to sheet. Let our me balance now turn

ratio We of with have strong a liquid balance current and X:X. sheet

our September no to and our XX, fully continue plan to and of in We maintain fund million dividend. we of our facility. strategic quarterly on $XXX credit flexibility million $XX.X debt As under approximately excess significant availability had cash, execute

Board declared result, dividend stock. our a a As common share of of of Directors quarterly $X.XX per

our prepared open concludes the for call please Operator, This questions. remarks today.

Operator

comes Anthony Lebiedzinski today & question first Our Instructions] from Company. from Sidoti [Operator

Anthony Lebiedzinski

average guess seeing of are terms of in other? what one I to on terms average the behind just Are you Or in wanted I value So to weakness. as bit declines order weakness what's color your the just little both? get core in SMB, the the frequency? you outweighing generally the and segment, customer is order is more which seeing a

Thomas Clark

Sure, Anthony.

coming back to still healthy our highlighted AOV And our managed seeing we we scores. less strong, that large very bit be. that we as very retention within down But that customer where it still those forward. satisfaction of very So especially as expect customer sales order larger seeing seeing opportunities on holding slightly. rates, be still through as channels, some is they're to We're is projects customers good frequency are as our seem some a well that again,

greater customer some of some that activities. did web they may terms unassigned that that QX of has throughout softness the a a manifests the we sales of are little into seeing that of little QX. the seen beginning on that In on bit our both that of talked in. onetime definitely And portfolio itself that And the softness, And be from and of business we've those bit customers about account continue set. maybe have we continued smaller coming some within and of transactional-type end we buying that

Anthony Lebiedzinski

think communicating proposition, the your you impact value And then of And looking are comment we to about of if I that? the more do should about in terms advertising? how so, mean, financial better

Richard Leeds

Richard. is This

so that competitors. done benefits one of our we're competition. So products the superior A we've versus our of able to the of lot that highlight is are to website improved we've products our things label private

for [ And would definitely highlighted We've ] see private we it making we're our pricing for be the label of not the is So products, that. our all website. [ where fixed should products. on that. it that We spot on just sure ]

reallocating deliver to the that to we've marketing returns As reallocating targeting that. relationships CPCs, And we customer data we're just customers. from and where through have customer higher The ads of stickier the to choppy retention waters higher CPCs higher customers to have those long-term looking gone we are advertising, drive and following think navigate some as going what's to up. the for higher and the drive that done going to we're

Anthony Lebiedzinski

in initiatives play All I And you the right. out? of as the well do remarks, you be will near guess, press to impactful far longer the most referenced your initiatives ones term the And growth in that as term? prepared which release take then think as as which will

Richard Leeds

Sure.

discussed, -- we these implementing we're Salesforce So marketing. we're Salesforce as putting, and --

going Salesforce and tools dealing they're next drive year think is initiative, they're running. going get us not that's they're Salesforce there. selling Once where up middle to marketing think, And going have on and best of now, lot reps tools. is that that That I with Salesforce initiative for state-of-the-art benefit relationship drive to the up, of our we out that. a going to take So I right -- are really to probably the get through to marketing sales

Operator

Francis Michael And our from comes question Blair. next William from

Michael Francis

for I'm on Ryan today.

the wanted soft? something is doing I off initiatives. decided this little a for and while, just that something you've being a been call? that on growth this that to Is the First, to highlight more you've that market question with you piggyback to do on want more Or

Thomas Clark

Yes.

down reflection. tools. sales I with those the force We've right arming going it's as think of our path been

for of For recent best those we trends seen a throughout way implementation reflection the I with situated direct It the kind of well the see we're customers. better year. think wasn't making it managed of and that course the part, the in and right we But we've discovery the of process now market began this sure results that periods.

to the want this them XXX-degree We will that have better target and giving experience, best they customer resilient customers available managers of and to sales be during drive allow being when and results. tools full that there those account time. have the our larger to midsized managed to our sales And team of view able some customers, be more seen really

and Richard rollouts, enhancements. been the of sales it's be with that with early working phased -- quickly. those something kind line our going into as current been very live it's part results, time of get we So year, And both we've modules the has we'll some said, merging but on of fully and as marketing should technology our we next the implemented and be mid with

Michael Francis

sort I there of got on And year. since SG&A talking do Okay. the you're on you of point? the there conditions sort number, at there soft? costs about. the there that the you've of appreciate anything some to might can ramp any then off back to know of a roll color lot that obviously, sort initiatives Is stay Is throttle I last

Thomas Clark

we of areas think when mean if I about we costs. a couple talk the Sure. about

some of Richard his CPC as up as that web really believe an area remarks we inflation that's is reallocate a resources, and can marketing customers. in through costs highlighted That's better get And that customer we mentioned, through those in that really on our we higher return -- as we the acquiring dollars. again on that digital as different seen prioritization efforts shows product one one, So again, have. that new channels. those we've that some we And that Richard targeting

we're So I a that we following where it's that data approach. anticipate improve the seeing test-and-learn can but moves. mean and

downtimes spending is going to fixed between as are as that well line obviously, we that there cost leverage to that to and they're will, cost a down. naturally an just to going discretionary our are and and baseline some at managing in top occupancy trend is times, fixed key salaries do ordinary we overall, again, controls basis and these But be of lead costs nature and especially Otherwise, other costs business on on all focused negative when they -- as the soft. that are obviously,

some right throttling in we we are the around key the back get spending where actions knowing direction, it. the we but line turning So again, need obviously, can that short to revenue are we in which taking term, to that, turn

Operator

We gentlemen, joining as today's this call. the today's session do you And ladies well at as presentation. conference and we'll conclude thank time, for question-and-answer

your You lines. may disconnect now

Global Industrial (GIC) 29 Oct 242024 Q3 Earnings call transcript