Turning Point Brands, Inc. (TPB) Bundle
A Brief History of Turning Point Brands, Inc.
Turning Point Brands, Inc. (NYSE: TPB) has established itself as a leading manufacturer, marketer, and distributor of branded consumer products, particularly in the alternative smoking accessories and consumables market. The company is recognized for its iconic brands, including Zig-Zag and Stoker's, and operates in over 217,000 retail outlets across North America.
Financial Performance Overview
As of September 30, 2024, Turning Point Brands reported a consolidated net sales increase of 3.8% year-over-year, totaling $105.6 million compared to $101.7 million in the same quarter of 2023. The gross profit for Q3 2024 was $53.7 million, reflecting an increase of 4.0% from $51.6 million in Q3 2023.
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Sales | $105.6 million | $101.7 million |
| Gross Profit | $53.7 million | $51.6 million |
| Net Income | $12.4 million | $10.8 million |
| Adjusted EBITDA | $27.2 million | $24.4 million |
| Diluted EPS | $0.68 | $0.58 |
Segment Performance
The company's revenue is primarily derived from three segments: Zig-Zag Products, Stoker's Products, and Creative Distribution Solutions (CDS). In Q3 2024, the performance of these segments was as follows:
- Zig-Zag Products: Net sales increased by 5.5% to $49.3 million, driven by strong performance in the North American Papers & Wraps business.
- Stoker's Products: Net sales rose by 12.1% to $41.4 million, benefiting from low single-digit growth in MST and significant growth in FRE sales.
- Creative Distribution Solutions (CDS): Net sales decreased by 17.4% to $14.9 million, attributed to strategic shifts in distribution.
| Segment | Net Sales (Q3 2024) | Net Sales (Q3 2023) |
|---|---|---|
| Zig-Zag Products | $49.3 million | $46.8 million |
| Stoker's Products | $41.4 million | $36.9 million |
| Creative Distribution Solutions | $14.9 million | $18.1 million |
Balance Sheet Highlights
As of September 30, 2024, the company reported total assets of $488.0 million, a decrease from $569.4 million at the end of 2023. Current assets were $184.8 million, while total liabilities stood at $301.3 million.
| Balance Sheet Item | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Assets | $488.0 million | $569.4 million |
| Total Liabilities | $301.3 million | $417.4 million |
| Stockholders' Equity | $186.8 million | $152.0 million |
Cash Flow Analysis
For the nine months ended September 30, 2024, consolidated net income was $37.5 million, up from $27.9 million in the prior year. The company provided net cash from operating activities of $49.3 million.
| Cash Flow Item | 2024 | 2023 |
|---|---|---|
| Consolidated Net Income | $37.5 million | $27.9 million |
| Net Cash from Operating Activities | $49.3 million | $40.0 million |
| Capital Expenditures | $(3.5 million) | $(4.2 million) |
Turning Point Brands continues to navigate the evolving market landscape while focusing on its strategic growth initiatives and maintaining robust financial health.
A Who Owns Turning Point Brands, Inc. (TPB)
Ownership Structure
As of 2024, Turning Point Brands, Inc. (TPB) is publicly traded on the New York Stock Exchange under the ticker symbol TPB. The ownership structure includes institutional investors, individual shareholders, and company executives. The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder Type | Number of Shares | Percentage Ownership |
|---|---|---|
| Institutional Investors | Approximately 11,000,000 | 62.3% |
| Insider Ownership | Approximately 1,000,000 | 5.6% |
| Retail Investors | Approximately 6,000,000 | 32.1% |
Major Institutional Shareholders
The following table lists the top institutional shareholders of TPB as of September 2024:
| Institution | Shares Held | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group, Inc. | 3,200,000 | 17.8% |
| BlackRock, Inc. | 2,500,000 | 13.9% |
| State Street Corporation | 1,800,000 | 10.0% |
| Wellington Management Co. LLP | 1,200,000 | 6.7% |
| Dimensional Fund Advisors LP | 1,000,000 | 5.6% |
Executive Ownership
Company executives also hold a significant stake in Turning Point Brands. The following table highlights the ownership details of key executives:
| Executive | Position | Shares Held | Percentage of Total Shares |
|---|---|---|---|
| Graham Purdy | President & CEO | 400,000 | 2.2% |
| Jenna M. McCarthy | CFO | 250,000 | 1.4% |
| Michael J. Tully | Chief Operating Officer | 150,000 | 0.8% |
Recent Financial Performance
Turning Point Brands has demonstrated solid financial performance in Q3 2024, which is relevant to understanding its ownership dynamics. The company reported:
- Net sales of $105.6 million, up 3.8% year-over-year.
- Net income of $12.4 million, an increase of 14.3% compared to the previous year.
- Adjusted EBITDA of $27.2 million, reflecting an 11.3% increase over Q3 2023.
Stock Performance
As of November 2024, the stock price of TPB stands at approximately $25.45, with a year-to-date increase of 18.5%. The market capitalization is around $450 million, reflecting a robust investor interest in the company's growth prospects.
Share Repurchase Program
Turning Point Brands has a share repurchase program authorized for $100 million, with $77.9 million remaining as of November 2024. This program aims to enhance shareholder value and reflects management's confidence in the company's future performance.
Turning Point Brands, Inc. (TPB) Mission Statement
Overview of Mission Statement
Turning Point Brands, Inc. (TPB) focuses on providing innovative consumer products that enhance the lifestyle of adult consumers. The company aims to lead in the alternative smoking category, offering high-quality branded products and maintaining a commitment to responsible marketing and distribution.
Financial Performance Indicators
As of the third quarter of 2024, Turning Point Brands reported significant financial metrics, reflecting its operational effectiveness and market position:
| Financial Metric | Q3 2024 | Q3 2023 | Year-over-Year Change |
|---|---|---|---|
| Total Net Sales | $105.6 million | $101.7 million | +3.8% |
| Gross Profit | $53.7 million | $51.6 million | +4.0% |
| Net Income | $12.4 million | $10.9 million | +14.3% |
| Adjusted EBITDA | $27.2 million | $24.4 million | +11.3% |
| Diluted EPS | $0.68 | $0.58 | +17.2% |
Product Segments Performance
The company operates through several product segments, with notable performance in the following areas:
| Product Segment | Net Sales Q3 2024 | Net Sales Q3 2023 | Year-over-Year Change |
|---|---|---|---|
| Zig-Zag Products | $49.3 million | $46.8 million | +5.5% |
| Stoker’s Products | $41.4 million | $36.9 million | +12.1% |
| Creative Distribution Solutions | $14.9 million | $18.1 million | -17.4% |
Market Presence and Strategic Goals
Turning Point Brands continues to expand its market presence, with products available in over 217,000 retail outlets across North America. The company is focused on sustainable growth through innovation and strategic marketing initiatives.
Operational Efficiency Metrics
Operational efficiency is crucial for TPB's mission, and the following metrics underscore its effectiveness:
| Operational Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Gross Margin | 50.8% | 50.8% |
| SG&A Expenses | $33.2 million | $31.4 million |
| Operating Income | $20.5 million | $20.2 million |
Outlook and Future Guidance
TPB has increased its full-year 2024 adjusted EBITDA guidance to a range of $101 million to $103 million, indicating a positive outlook for sustained operational performance and profitability.
Overall, Turning Point Brands, Inc. remains committed to its mission of providing innovative products while ensuring responsible growth and operational excellence in the competitive marketplace.
How Turning Point Brands, Inc. (TPB) Works
Company Overview
Turning Point Brands, Inc. (TPB) operates in the consumer products sector, focusing on the manufacture, marketing, and distribution of branded consumer products, including alternative smoking accessories and consumables with active ingredients. Its flagship brands include Zig-Zag and Stoker's, with products available in over 217,000 retail outlets across North America.
Financial Performance
As of the third quarter of 2024, TPB reported the following financial results:
| Financial Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Sales | $105,617,000 | $101,722,000 |
| Cost of Sales | $51,918,000 | $50,100,000 |
| Gross Profit | $53,699,000 | $51,622,000 |
| Operating Income | $20,530,000 | $20,237,000 |
| Net Income | $12,375,000 | $10,831,000 |
| Basic Earnings per Share | $0.70 | $0.62 |
| Diluted Earnings per Share | $0.68 | $0.58 |
Segment Performance
Turning Point Brands segments its operations into three main parts: Zig-Zag Products, Stoker’s Products, and Creative Distribution Solutions (CDS). The performance of each segment in Q3 2024 was as follows:
| Segment | Net Sales | Gross Profit | Gross Margin |
|---|---|---|---|
| Zig-Zag Products | $49,324,000 | $27,327,000 | 55.4% |
| Stoker’s Products | $41,380,000 | $23,071,000 | 55.8% |
| Creative Distribution Solutions | $14,913,000 | $3,301,000 | 22.1% |
Cash Flow and Liquidity
For the nine months ended September 30, 2024, TPB reported the following cash flow metrics:
| Cash Flow Metrics | 2024 | 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $49,321,000 | $40,005,000 |
| Net Cash Used in Investing Activities | $(9,064,000) | $(4,403,000) |
| Net Cash Used in Financing Activities | $(127,527,000) | $(45,956,000) |
| Cash at End of Period | $35,516,000 | $101,000,000 |
Debt and Equity Structure
As of September 30, 2024, TPB's total liabilities and stockholders' equity were as follows:
| Metrics | Amount |
|---|---|
| Total Assets | $488,009,000 |
| Total Liabilities | $301,250,000 |
| Total Stockholders' Equity | $186,759,000 |
| Total Gross Debt | $250,000,000 |
| Net Debt | $216,443,000 |
Market Outlook
Turning Point Brands has increased its full-year 2024 adjusted EBITDA guidance to between $101 million and $103 million, signaling positive expectations for continued growth in its core product lines.
How Turning Point Brands, Inc. (TPB) Makes Money
Revenue Streams
Turning Point Brands, Inc. generates revenue primarily through three segments: Zig-Zag Products, Stoker’s Products, and Creative Distribution Solutions (CDS).
| Segment | Q3 2024 Net Sales (in millions) | Q3 2023 Net Sales (in millions) | Growth Rate | Contribution to Total Net Sales |
|---|---|---|---|---|
| Zig-Zag Products | $49.3 | $46.8 | 5.5% | 47% |
| Stoker’s Products | $41.4 | $36.9 | 12.1% | 39% |
| Creative Distribution Solutions | $14.9 | $18.1 | -17.4% | 14% |
Zig-Zag Products
The Zig-Zag segment includes rolling papers and cigar products. Net sales increased to $49.3 million in Q3 2024, marking a 5.5% increase year-over-year. The gross profit for this segment was $27.3 million, with a gross margin of 55.4%. The growth is attributed to strong performance in North American papers and wraps, as well as solid growth in cigars.
Stoker’s Products
The Stoker's segment focuses on moist snuff tobacco (MST) and loose-leaf chew products. In Q3 2024, net sales rose to $41.4 million, representing a 12.1% increase compared to the previous year. The gross profit for Stoker’s Products was $23.1 million, with a gross margin of 55.8%. This growth was driven by low single-digit growth in MST and significant increases in alternative product sales.
Creative Distribution Solutions (CDS)
This segment provides distribution services for various tobacco-related products. In Q3 2024, CDS reported net sales of $14.9 million, a decrease of 17.4% from Q3 2023. The gross profit was $3.3 million with a gross margin of 22.1%. The decline in sales reflects challenges in the distribution network and market competition.
Financial Performance
For the third quarter of 2024, Turning Point Brands reported total consolidated net sales of $105.6 million, which is a 3.8% increase year-over-year. The gross profit for the quarter was $53.7 million, while operating income stood at $20.5 million.
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Sales | $105.6 million | $101.7 million |
| Gross Profit | $53.7 million | $51.6 million |
| Operating Income | $20.5 million | $20.2 million |
| Net Income | $12.4 million | $10.8 million |
Adjusted EBITDA
Turning Point Brands reported an Adjusted EBITDA of $27.2 million for Q3 2024, up 11.3% from the previous year. This reflects the company's ability to maintain operational efficiency across its segments despite market pressures.
Debt and Liquidity Position
As of September 30, 2024, the total gross debt was $250 million, with a net debt of $216.4 million after accounting for unrestricted cash. The company had total liquidity of $92.4 million, which included $33.6 million in cash and $58.8 million in available credit.
Market Position and Future Outlook
Turning Point Brands continues to strengthen its market position with a focus on expanding its Zig-Zag and Stoker’s brands. The company has projected an increase in full-year 2024 Adjusted EBITDA guidance to $101 to $103 million, indicating a positive outlook based on the current growth trajectories in its primary segments.
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Resources:
- Turning Point Brands, Inc. (TPB) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Turning Point Brands, Inc. (TPB)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Turning Point Brands, Inc. (TPB)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.