Steel Partners Holdings L.P. (SPLP) Bundle
A Brief History of Steel Partners Holdings L.P.
Steel Partners Holdings L.P. (SPLP) has undergone significant transformations and expansions since its inception. The company has diversified its operations across various sectors including diversified industrials, financial services, supply chain, and energy. As of September 30, 2024, SPLP reported a net income of $196,620,000 for the nine months, compared to $111,305,000 for the same period in 2023.
Financial Performance Overview
For the three months ended September 30, 2024, SPLP's revenue reached $520,423,000, reflecting an increase of 5.7% from $492,254,000 in the prior year. The company attributed this growth to improved sales across its diversified industrial and supply chain segments.
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Revenue | $520,423,000 | $492,254,000 | 5.7% |
| Net Income | $36,873,000 | $27,887,000 | 32.4% |
| Operating Income | $53,097,000 | $30,046,000 | 76.6% |
Segment Performance
The company’s diversified industrial segment reported a revenue increase of $19,544,000 or 6.5%, while the supply chain segment saw a growth of $8,479,000 or 21.2% for the three months ended September 30, 2024.
Cost Structure
The cost of goods sold for Q3 2024 was $295,577,000, up from $283,285,000 in Q3 2023, indicating a rise of 4.3%. Selling, general, and administrative expenses (SG&A) increased by 9.9% to $137,310,000 due to higher operational costs.
Cash Flow Analysis
During the nine months ended September 30, 2024, SPLP generated $368,173,000 in cash from operating activities, a significant increase from $11,675,000 in the same period of 2023. This was primarily driven by a decrease in loans held for sale and an increase in net income.
| Cash Flow Category | 9 Months Ended Sept 30, 2024 | 9 Months Ended Sept 30, 2023 |
|---|---|---|
| Net Cash from Operating Activities | $368,173,000 | $11,675,000 |
| Net Cash from Investing Activities | $2,312,000 | ($168,692,000) |
| Net Cash from Financing Activities | ($560,437,000) | $486,419,000 |
Debt and Equity Structure
The company reported a decrease in interest expense of 51.6% for Q3 2024 compared to the same period last year, reflecting lower average debt levels. As of September 30, 2024, SPLP had 6,345,982 preferred units outstanding.
Overall, Steel Partners Holdings L.P. has demonstrated resilience and growth through strategic expansions and operational efficiencies, positioning itself for future opportunities in the market.
A Who Owns Steel Partners Holdings L.P. (SPLP)
Ownership Structure
As of 2024, Steel Partners Holdings L.P. (SPLP) has a diverse ownership structure that includes both common and preferred units held by various investors.
Common Units Outstanding
As of September 30, 2024, the total number of common units outstanding was 19,183,332, with 20,626,267 units held in treasury.
Preferred Units Outstanding
The company had 6,345,982 SPLP Preferred Units outstanding as of September 30, 2024.
Major Shareholders
The ownership of SPLP is concentrated among a few significant shareholders, including institutional investors and individual stakeholders. The table below summarizes the key ownership percentages:
| Shareholder Type | Number of Units | Percentage of Total Units |
|---|---|---|
| Institutional Investors | ~10,000,000 | ~52% |
| Founders/Management | ~5,000,000 | ~26% |
| Retail Investors | ~4,000,000 | ~21% |
Recent Transactions
In September 2024, SPLP entered into a purchase agreement to acquire 1,267,803 common units from Hale Partnership Fund, L.P. for an aggregate price of $63,390.
Common Unit Repurchase Program
The company has been active in repurchasing its common units. As of September 30, 2024, SPLP had repurchased a total of 8,799,777 common units for approximately $206,078 since the inception of its repurchase program .
Net Income and Earnings per Unit
For the three months ended September 30, 2024, SPLP reported a net income of $36,873,000, translating to a net income attributable to common unitholders of $36,416,000. The net income per common unit for this period was reported as $1.83.
Distribution Policy
SPLP has declared a quarterly cash distribution of $0.375 per preferred unit, payable on December 15, 2024, to unitholders of record as of December 1, 2024.
Conclusion of Ownership Analysis
The ownership of Steel Partners Holdings L.P. reflects a mix of institutional, management, and retail investors, with significant recent activity in unit repurchases and acquisitions that underline the company's strategic financial management.
Steel Partners Holdings L.P. (SPLP) Mission Statement
Overview
Steel Partners Holdings L.P. (SPLP) is a diversified global holding company that seeks to enhance long-term value for its unitholders and stakeholders through strategic capital allocation and operational improvements. The company focuses on various sectors, including diversified industrial, financial services, energy, and supply chain, aiming to leverage its operational expertise and financial acumen to drive growth and profitability.
Financial Performance
As of September 30, 2024, SPLP reported a net income of $196,620,000 for the nine months ended, compared to $111,305,000 for the same period in the previous year. For the third quarter, the net income was $36,873,000, up from $27,887,000 year-over-year.
Revenue Breakdown
The company's revenue for the nine months ended September 30, 2024, was $1,529,928,000, reflecting an increase from $1,438,550,000 in the previous year. The revenue for the three months ended September 30, 2024, was $520,423,000, compared to $492,254,000 in the same quarter of 2023.
| Segment | Revenue Q3 2024 ($000) | Revenue Q3 2023 ($000) | Revenue YTD 2024 ($000) | Revenue YTD 2023 ($000) |
|---|---|---|---|---|
| Diversified Industrial | 318,642 | 299,098 | 945,576 | 918,570 |
| Energy | 40,266 | 46,742 | 109,182 | 145,220 |
| Financial Services | 113,027 | 106,405 | 338,575 | 304,570 |
| Supply Chain | 48,488 | 40,009 | 136,595 | 70,190 |
| Total | 520,423 | 492,254 | 1,529,928 | 1,438,550 |
Cost and Expenses
Total costs and expenses for the nine months ended September 30, 2024, were $1,365,207,000, compared to $1,317,008,000 for the same period in 2023. The breakdown for the three months ended September 30, 2024, includes:
- Cost of Goods Sold: $295,577,000
- Selling, General and Administrative Expenses: $137,310,000
- Interest Expense: $1,993,000
- Realized and Unrealized Losses on Securities, Net: $2,060,000
Capital Structure
As of September 30, 2024, SPLP had 39,809,599 common units outstanding, with total partners' capital amounting to $1,042,857,000. The accumulated other comprehensive loss was $121,147,000.
| Item | Amount ($000) |
|---|---|
| Total Assets | 3,634,075 |
| Total Liabilities | 2,550,218 |
| Total Partners' Capital | 1,042,857 |
Future Strategic Focus
SPLP aims to continue enhancing liquidity through operational efficiencies and strategic acquisitions. The company is committed to implementing the Steel Business System across its operations to improve sales and operational efficiencies, thereby increasing stakeholder value.
How Steel Partners Holdings L.P. (SPLP) Works
Overview of Operations
Steel Partners Holdings L.P. (SPLP) operates as a diversified global holding company, engaging in various segments including Diversified Industrial, Financial Services, Supply Chain, and Energy. As of September 30, 2024, SPLP reported total assets of $3.634 billion, down from $3.990 billion at the end of 2023.
Financial Performance
| Metrics | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| Revenue | $520,423 | $492,254 | $1,529,928 | $1,438,550 |
| Cost of Goods Sold | $295,577 | $283,285 | $872,929 | $833,977 |
| Selling, General & Administrative Expenses | $137,310 | $124,934 | $412,301 | $376,252 |
| Net Income | $36,873 | $27,887 | $196,620 | $111,305 |
Segment Performance
For the three months ended September 30, 2024, the Diversified Industrial segment generated revenue of $319,034, a 6.5% increase year-over-year, driven by strong demand across various business units. The Financial Services segment reported an increase of $6,622, or 6.2%, primarily due to higher interest income. The Supply Chain segment also saw a substantial increase, with revenue growing by $8,479, or 21.2%.
Cost Structure
Cost of goods sold increased by $12,292, or 4.3%, for the three months ended September 30, 2024. Selling, general and administrative expenses rose by $12,376, or 9.9%, influenced by higher expenses in the Financial Services and Supply Chain segments.
Cash Flow Analysis
| Cash Flow Activity | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $368,173 | $11,675 |
| Net Cash Provided (Used) by Investing Activities | $2,312 | ($168,692) |
| Net Cash (Used) Provided by Financing Activities | ($560,437) | $486,419 |
Liquidity and Capital Resources
SPLP maintains a senior credit facility with a total capacity of up to $600 million, which includes provisions for swing line loans and letters of credit. As of September 30, 2024, the company had a total liquidity position that allows it to manage its operations and capital investments effectively.
Pension and Equity Compensation
During the nine months ended September 30, 2024, SPLP contributed $7,226 to its pension plans. The net pension expense for the same period was $4,123, reflecting the impact of interest costs and expected returns on plan assets.
Shareholder Returns
SPLP declared cash distributions of approximately $7,139 and $7,225 to preferred unitholders for the nine months ended September 30, 2024, and 2023, respectively. The company has a repurchase program for common units, with 1,267,803 units purchased from Hale Partnership Fund for $63,390 on September 1, 2024.
Income Tax Provision
For the three months ended September 30, 2024, SPLP recorded an income tax provision of $16,224 compared to a benefit of $981 for the same period in 2023. For the nine months, the tax provision was $31,906, reflecting the company's operations in various tax jurisdictions.
Net Income per Common Unit
| Metrics | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| Net Income per Common Unit (Basic) | $1.83 | $1.20 | $9.19 | $5.10 |
| Net Income per Common Unit (Diluted) | $1.65 | $1.14 | $8.02 | $4.68 |
Balance Sheet Highlights
| Balance Sheet Item | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Assets | $3,634,075 | $3,990,440 |
| Total Liabilities | $2,792,754 | $2,978,509 |
| Total Capital | $841,321 | $1,011,931 |
How Steel Partners Holdings L.P. (SPLP) Makes Money
Revenue Sources
Steel Partners Holdings L.P. (SPLP) generates revenue from multiple segments, including Financial Services, Diversified Industrial, Supply Chain, and Energy. The financial performance for the nine months ended September 30, 2024, is detailed below:
| Segment | Revenue (2024) | Revenue (2023) | Growth Rate |
|---|---|---|---|
| Diversified Industrial | $945,576 | $918,570 | 2.9% |
| Financial Services | $338,575 | $304,570 | 11.2% |
| Supply Chain | $136,595 | $70,190 | 94.6% |
| Energy | $109,182 | $145,220 | -24.8% |
| Total Revenue | $1,529,928 | $1,438,550 | 6.4% |
Segment Analysis
The performance of SPLP's segments reveals the dynamics of their revenue generation:
- Diversified Industrial: The increase in revenue was driven primarily by higher sales in the Joining Materials, Electrical Products, and Building Materials business units.
- Financial Services: Revenue growth was attributed to higher interest income and fees from increased asset-based lending and credit risk transfer activities.
- Supply Chain: This segment, added in May 2023, experienced substantial growth primarily due to increased sales volume.
- Energy: Revenue decline was mainly due to lower rig hours, reflecting challenges in the sector.
Operating Income
Operating income for the nine months ended September 30, 2024, across various segments is summarized below:
| Segment | Operating Income (2024) | Operating Income (2023) |
|---|---|---|
| Diversified Industrial | $66,175 | $61,015 |
| Financial Services | $80,846 | $48,246 |
| Supply Chain | $8,870 | $5,846 |
| Energy | $8,149 | $15,239 |
| Corporate and Other | $5,748 | $(4,814) |
| Total Operating Income | $169,788 | $125,532 |
Cash Flows
For the nine months ended September 30, 2024, SPLP reported the following cash flows:
| Cash Flow Activity | 2024 Amount | 2023 Amount |
|---|---|---|
| Net cash provided by operating activities | $368,173 | $11,675 |
| Net cash provided by (used in) investing activities | $2,312 | $(168,692) |
| Net cash (used in) provided by financing activities | $(560,437) | $486,419 |
| Net change for the period | $(189,952) | $329,402 |
Net Income
Net income attributable to common unitholders for the nine months ended September 30 is as follows:
| Period | Net Income (2024) | Net Income (2023) |
|---|---|---|
| Nine Months | $196,620 | $111,305 |
| Three Months | $36,873 | $27,887 |
Income Per Common Unit
The earnings per common unit for the periods ended September 30 are reported below:
| Period | Basic Earnings per Common Unit | Diluted Earnings per Common Unit |
|---|---|---|
| Nine Months (2024) | $9.19 | $8.02 |
| Nine Months (2023) | $5.10 | $4.68 |
Conclusion
The financial performance indicators reflect SPLP's diversified revenue streams and segment contributions, showcasing resilience amidst varying market conditions. Effective management of cash flows and strategic segment growth are essential to SPLP's profitability.
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Resources:
- Steel Partners Holdings L.P. (SPLP) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Steel Partners Holdings L.P. (SPLP)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Steel Partners Holdings L.P. (SPLP)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.