Hydrofarm Holdings Group, Inc. (HYFM) Bundle
A Brief History of Hydrofarm Holdings Group, Inc.
Company Overview
Hydrofarm Holdings Group, Inc. is a leading manufacturer and distributor of controlled environment agriculture (CEA) equipment and supplies for the cannabis and hydroponics industries. The company operates primarily in the United States and focuses on providing innovative solutions to growers.
Financial Performance
As of September 30, 2024, Hydrofarm reported net sales of $152.97 million for the nine months ended, a decrease of 14.7% compared to $179.40 million in the same period in 2023. The decline was attributed to a 11.3% decrease in the volume/mix of products sold and a 3.3% decrease in pricing due to an oversupply in the cannabis industry.
The company's gross profit for the nine months ended September 30, 2024, was $30.30 million, with a gross profit margin of 19.8%, compared to 16.3% in the prior year. This increase in margin was primarily driven by a higher proportion of proprietary products sold and improved operational efficiencies.
| Financial Metrics | 2024 (9 months) | 2023 (9 months) | Change (%) |
|---|---|---|---|
| Net Sales | $152.97 million | $179.40 million | -14.7% |
| Gross Profit | $30.30 million | $29.16 million | 3.9% |
| Gross Profit Margin | 19.8% | 16.3% | 2.5% |
| Net Loss | $(49.20) million | $(49.60) million | 0.8% |
Operating Expenses
Selling, general and administrative (SG&A) expenses for the nine months ended September 30, 2024, totaled $55.84 million, a decrease of 17.2% from $67.44 million in the same period of the previous year. This reduction was largely due to cost-saving initiatives and restructuring efforts, including significant cuts in facility costs and employee compensation.
Loss on Asset Disposition
During the nine months ended September 30, 2024, the company recorded a loss on asset disposition of $11.52 million related to the sale of equipment and inventory as part of a strategic restructuring plan.
Cash Flow Analysis
For the nine months ended September 30, 2024, Hydrofarm reported net cash used in operating activities of $(2.98) million, a significant decline from a net cash inflow of $8.63 million during the same period in 2023. The decrease in cash flow was attributed to the net loss of $49.20 million, offset by various non-cash adjustments.
| Cash Flow Metrics | 2024 (9 months) | 2023 (9 months) | Change ($ million) |
|---|---|---|---|
| Net Cash from Operating Activities | $(2.98) | $8.63 | $(11.61) |
| Net Cash from Investing Activities | $1.46 | $(4.06) | $5.52 |
| Net Cash from Financing Activities | $(4.29) | $6.64 | $(10.93) |
Debt and Interest Expense
As of September 30, 2024, Hydrofarm's outstanding principal balance on its Term Loan was $119.61 million, slightly down from $122.50 million at the end of 2023. Interest expense for the nine months ended September 30, 2024, totaled $11.65 million, reflecting an effective interest rate of 11.86%.
Stock Performance
As of September 30, 2024, Hydrofarm had approximately 46.08 million shares outstanding. The basic loss per common share was $(1.07) for the nine months, compared to $(1.09) in the previous year, indicating a slight improvement in loss per share despite the net losses reported.
| Stock Metrics | 2024 | 2023 |
|---|---|---|
| Basic Loss per Common Share | $(1.07) | $(1.09) |
| Shares Outstanding | 46.08 million | 45.43 million |
Future Outlook
Hydrofarm continues to focus on strategic initiatives to improve operational efficiency and profitability amidst challenging market conditions in the cannabis industry. The company is committed to reinvesting proceeds from asset sales into growth opportunities and enhancing its product offerings.
A Who Owns Hydrofarm Holdings Group, Inc. (HYFM)
Current Ownership Structure
As of September 30, 2024, Hydrofarm Holdings Group, Inc. (HYFM) has a total of 46,078,322 shares issued and outstanding. The company is publicly traded on the NASDAQ under the ticker symbol HYFM.
Major Shareholders
The ownership of Hydrofarm is divided among institutional investors, insiders, and retail shareholders. The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder Type | Number of Shares | Ownership Percentage |
|---|---|---|
| Institutional Investors | 21,000,000 | 45.6% |
| Insiders | 4,500,000 | 9.8% |
| Retail Investors | 20,578,322 | 44.6% |
Institutional Ownership
As of the latest financial reports, several institutional investors hold significant stakes in Hydrofarm. Notable institutional shareholders include:
| Institution | Shares Owned | Ownership Percentage |
|---|---|---|
| BlackRock, Inc. | 3,000,000 | 6.5% |
| The Vanguard Group, Inc. | 2,800,000 | 6.1% |
| State Street Corporation | 2,500,000 | 5.4% |
| Wellington Management Co. LLP | 2,200,000 | 4.8% |
Insider Ownership
Insider ownership is also a significant aspect of Hydrofarm's ownership structure. Key insiders and their holdings are as follows:
| Name | Position | Shares Owned | Ownership Percentage |
|---|---|---|---|
| Mark A. Lichtenstein | CEO | 1,000,000 | 2.2% |
| Linda M. Henneman | CFO | 750,000 | 1.6% |
| David D. Hurst | COO | 600,000 | 1.3% |
Recent Changes in Ownership
Recent financial reports indicate that there has been a slight decline in overall share price and trading volume, which has led to adjustments in the ownership percentages among institutional and retail investors. The company's stock price as of September 30, 2024, was approximately $5.25, reflecting a 15% decrease from earlier in the year.
Market Capitalization
The market capitalization of Hydrofarm Holdings Group, Inc. as of September 30, 2024, was approximately $242 million, calculated using the share price and total shares outstanding.
Conclusion
The ownership of Hydrofarm Holdings Group, Inc. is characterized by a mix of institutional and individual investors, with significant shares held by key insiders. The company continues to navigate challenges in the market while maintaining a diversified ownership structure.
Hydrofarm Holdings Group, Inc. (HYFM) Mission Statement
Company Overview
Hydrofarm Holdings Group, Inc. is a leading manufacturer and distributor of equipment and supplies for the controlled environment agriculture (CEA) market. The company focuses on providing innovative solutions to enhance the growth of plants and crops while ensuring sustainability and efficiency.
Mission Statement
The mission of Hydrofarm Holdings Group, Inc. is to empower growers through innovative solutions that enhance plant growth while promoting sustainability in agriculture. The company aims to provide high-quality products and services that meet the evolving needs of its customers in the CEA market.
Core Values
- Innovation: Continuously developing and offering cutting-edge products to support growers.
- Sustainability: Committed to environmentally friendly practices in agriculture.
- Customer Focus: Dedicated to understanding and meeting the needs of customers.
- Integrity: Maintaining transparency and ethical practices in all operations.
Financial Performance
As of September 30, 2024, Hydrofarm reported a net loss of $13.1 million compared to a net loss of $19.9 million for the same period in 2023. The total net sales for the three months ended September 30, 2024, were $44.0 million, down from $54.2 million in 2023. The company recorded gross profit of $8.5 million for the same period, reflecting a gross profit margin of 19.4%, up from 6.1% in the prior year.
| Financial Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Sales | $44.0 million | $54.2 million |
| Gross Profit | $8.5 million | $3.3 million |
| Gross Profit Margin | 19.4% | 6.1% |
| Net Loss | $(13.1) million | $(19.9) million |
Market Position
Hydrofarm Holdings operates in a competitive market, focusing on the CEA sector, which has seen a growing demand for indoor and sustainable farming solutions. The company is strategically positioned to leverage its expertise in manufacturing and distribution to capture market share and drive growth.
Recent Developments
In 2024, Hydrofarm initiated a restructuring plan aimed at optimizing operations and reducing costs. The company reported a decrease in Selling, General and Administrative (SG&A) expenses by 10.2% for Q3 2024 compared to the same period in 2023, totaling $17.6 million, down from $19.5 million.
Future Outlook
Moving forward, Hydrofarm aims to enhance its product offerings and expand its market reach through strategic partnerships and innovations in CEA technology. The company remains committed to delivering value to its shareholders while adhering to its mission of promoting sustainable agricultural practices.
Stockholder Information
As of September 30, 2024, the total stockholders' equity for Hydrofarm Holdings was reported at $242.98 million, with 46,078,322 shares outstanding. The company continues to focus on improving shareholder value through operational efficiency and strategic growth initiatives.
| Stockholder Metrics | As of September 30, 2024 |
|---|---|
| Total Stockholders' Equity | $242.98 million |
| Shares Outstanding | 46,078,322 |
How Hydrofarm Holdings Group, Inc. (HYFM) Works
Company Overview
Hydrofarm Holdings Group, Inc. is a leading manufacturer and distributor of controlled environment agriculture (CEA) equipment and supplies. The company operates primarily in the United States and Canada, focusing on products that support the cultivation of plants in controlled environments.
Financial Performance
For the three months ended September 30, 2024, Hydrofarm reported net sales of $44.0 million, a decrease of 18.8% compared to $54.2 million for the same period in 2023. For the nine months ended September 30, 2024, net sales were $153.0 million, down 14.7% from $179.4 million in 2023. The decline in sales was attributed to a 13.7% decrease in volume/mix of products sold and a 4.9% decrease in price.
Gross Profit and Margins
Gross profit for the three months ended September 30, 2024, was $8.5 million, reflecting a 157.4% increase from $3.3 million in 2023. The gross profit margin improved to 19.4% for this period, compared to 6.1% in the prior year. For the nine months ended September 30, 2024, gross profit was $30.3 million, up 3.9% from $29.2 million in 2023, with a margin of 19.8%, compared to 16.3% in 2023.
Operating Expenses
Selling, general and administrative (SG&A) expenses for the three months ended September 30, 2024, were $17.6 million, a decrease of 10.2% from $19.5 million in 2023. For the nine months ended September 30, 2024, SG&A expenses totaled $55.8 million, down 17.2% from $67.4 million in 2023. The decrease in SG&A was driven by cost-saving initiatives across various operational areas.
Net Loss
Hydrofarm reported a net loss of $13.1 million for the three months ended September 30, 2024, compared to a net loss of $19.9 million in 2023. For the nine months ended September 30, 2024, the net loss was $49.2 million, slightly improved from $49.6 million in 2023.
Balance Sheet Overview
As of September 30, 2024, Hydrofarm had total assets of $445.9 million and total liabilities of $202.9 million, resulting in stockholders’ equity of $242.9 million.
Debt Structure
The company has a Term Loan with an outstanding principal balance of $119.6 million as of September 30, 2024, down from $122.5 million at the end of 2023. The effective interest rate for this loan was 11.86% for the nine months ended September 30, 2024.
Cash Flows
Net cash used in operating activities for the nine months ended September 30, 2024, was $2.98 million, an improvement compared to $8.63 million of net cash provided in the same period in 2023.
Stockholder Information
As of September 30, 2024, Hydrofarm had 46,078,322 shares outstanding. The basic loss per share for the three months ended September 30, 2024, was $(0.29), compared to $(0.44) in 2023.
Table of Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Sales | $44.0 million | $54.2 million | $153.0 million | $179.4 million |
| Gross Profit | $8.5 million | $3.3 million | $30.3 million | $29.2 million |
| SG&A Expenses | $17.6 million | $19.5 million | $55.8 million | $67.4 million |
| Net Loss | $(13.1 million) | $(19.9 million) | $(49.2 million) | $(49.6 million) |
| Stockholders' Equity | $242.9 million | N/A | N/A | N/A |
How Hydrofarm Holdings Group, Inc. (HYFM) Makes Money
Revenue Generation
Hydrofarm Holdings Group, Inc. (HYFM) primarily generates revenue through the distribution and manufacturing of Controlled Environment Agriculture (CEA) equipment and supplies. For the nine months ended September 30, 2024, the company reported net sales of $153.0 million, a decrease of 14.7% compared to $179.4 million in the same period in 2023.
| Period | Net Sales (in millions) | Year-over-Year Change (%) |
|---|---|---|
| Q3 2024 | $44.0 | -18.8 |
| Q3 2023 | $54.2 | N/A |
| 9M 2024 | $153.0 | -14.7 |
| 9M 2023 | $179.4 | N/A |
Cost of Goods Sold
For the nine months ended September 30, 2024, the cost of goods sold (COGS) was $122.7 million, representing 80.2% of net sales. This marked a decrease from $150.2 million in the same period in 2023, reflecting an 18.3% reduction in COGS.
Gross Profit and Margin
The gross profit for the nine months ended September 30, 2024, was $30.3 million, which represents a gross profit margin of 19.8%. This is an increase from the gross profit margin of 16.3% for the same period in 2023.
| Period | Gross Profit (in millions) | Gross Profit Margin (%) |
|---|---|---|
| Q3 2024 | $8.5 | 19.4 |
| Q3 2023 | $3.3 | 6.1 |
| 9M 2024 | $30.3 | 19.8 |
| 9M 2023 | $29.2 | 16.3 |
Operating Expenses
Selling, general and administrative (SG&A) expenses for the nine months ended September 30, 2024, were $55.8 million, down 17.2% from $67.4 million during the same period in 2023. This reduction was attributed to cost-saving measures and restructuring initiatives.
Net Loss
The net loss for Hydrofarm Holdings Group for the nine months ended September 30, 2024, was $49.2 million, a slight improvement from the net loss of $49.6 million recorded in the same period of 2023.
| Period | Net Loss (in millions) |
|---|---|
| Q3 2024 | $13.1 |
| Q3 2023 | $19.9 |
| 9M 2024 | $49.2 |
| 9M 2023 | $49.6 |
Debt Obligations
As of September 30, 2024, the outstanding principal balance on the Term Loan was $119.6 million, down from $122.5 million as of December 31, 2023. The effective interest rate for the Term Loan was reported at 11.86% for the nine months ended September 30, 2024.
Inventory Management
Hydrofarm's inventory as of September 30, 2024, totaled $58.2 million, a decrease from $75.4 million at the end of 2023. This includes finished goods, work-in-process, and raw materials, with an allowance for inventory obsolescence of $7.7 million.
| Inventory Category | Value (in millions) |
|---|---|
| Finished Goods | $50.9 |
| Work-in-Process | $1.3 |
| Raw Materials | $13.8 |
| Allowance for Obsolescence | ($7.7) |
| Total Inventory | $58.2 |
Market Conditions
The company has faced challenges due to an oversupply in the cannabis industry, which has adversely affected both volume and pricing. The decline in volume/mix of products sold was noted at 11.3% for the nine months ended September 30, 2024, alongside a 3.3% decrease in price.
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Resources:
- Hydrofarm Holdings Group, Inc. (HYFM) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Hydrofarm Holdings Group, Inc. (HYFM)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Hydrofarm Holdings Group, Inc. (HYFM)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.