24/7 Market News- Alliance Entertainment Reports Q4 and FY 2024 Results

September 20, 2024

DENVER, Colo., Sep 20, 2024 (247marketnews.com)- Alliance Entertainment (Nasdaq: AENT) reported its financial and operational results for its fiscal fourth quarter and full year, which ended June 30, 2024.

Among its highlights, Alliance Entertainment increased its gross profit increased by 24%, compared to 2023, to $128.9 million for fiscal year 2024, on improved gross margins, and net income turned positive, hitting $4.6 million in fiscal year 2024, compared to a $40 million improvement from the net loss of $35.4 million in the prior year.

Bruce Ogilvie, Alliance Entertainment’s Chairman, detailed, “We made substantial progress in strengthening our business during fiscal 2024, and I am proud of the strategic actions we took to position Alliance Entertainment for long-term growth and profitability. Our exclusive distribution rights and broad content portfolio have allowed us to maintain resilient demand in key areas, such as physical music and movies, where we’ve seen growth in vinyl, CDs, and home video products.

“We continued to grow our Direct-to-Consumer (DTC) channel in 2024, which now represents 36% of our gross revenue, up from 31% the previous year. This shift highlights the effectiveness of our approach in meeting evolving consumer preferences, and it is helping to diversify and strengthen our revenue base. These higher margin sales, combined with improved operational efficiencies and other strategic initiatives, have contributed to a $40 million turnaround in net income and a $41.9 million improvement in adjusted EBITDA during fiscal 2024.

“Looking ahead, with new gaming hardware releases on the horizon and the collectibles market showing stability, we are confident in our ability to capture future demand and continue enhancing profitability as we move into fiscal 2025 and beyond.”

Jeff Walker, Alliance Entertainment’s CEO, further stated, “Throughout fiscal 2024, we focused on executing our operational strategies to drive profitability and efficiency, and the results speak for themselves. Our emphasis on cost control and margin enhancement delivered a 24% increase in gross profit, raising gross margins to 11.7% and demonstrating our ability to extract value from our revenue streams and adapt to evolving market dynamics without sacrificing operational strength.

“One of our proudest achievements this year was turning around adjusted EBITDA. We improved it by $41.9 million, from a loss of $17.6 million last year to positive $24.3 million in fiscal 2024. This significant recovery is a testament to the cost efficiencies we’ve achieved, particularly through warehouse automation and the strategic reduction of non-essential expenditures. Our ability to streamline operations while focusing on higher-margin products has played a pivotal role in this positive trajectory.

“Our net income also saw a dramatic improvement, rising to $4.6 million for fiscal 2024, a $40 million turnaround from the prior year’s net loss of $35.4 million. This milestone highlights the success of our long-term initiatives aimed at reducing operational costs and improving overall profitability. The combination of a stronger margin profile and disciplined cost management has positioned us to continue delivering profitable growth.

“In specific product categories, we saw promising developments. In our gaming segment, we more than doubled the average selling price, particularly in hardware and retro arcade products. Our strategic shift toward higher-value offerings is proving successful, and we expect to benefit from new hardware releases in the coming year. Similarly, in consumer products, we improved margins and pricing, demonstrating the effectiveness of our inventory rationalization efforts.

“Physical media, a core part of our portfolio, continues to show resilience and growth. Vinyl sales grew 2%, and physical movie sales surged by 8% this year, driven by demand for premium formats like 4K UHD and collectible editions. We are well positioned to capture more of this demand as brick-and-mortar retailers increasingly cater to consumers seeking curated, high-quality entertainment experiences. Our ability to provide retailers with a diverse and extensive product range across both physical and digital channels remains a key differentiator.

“From a liquidity perspective, we have made significant strides in strengthening our financial position. We reduced our revolver balance by 45%, from $133 million to $70 million, and saw net cash from operations soar by 1,547%, reaching $55.8 million in fiscal 2024. Additionally, to support growth, we recently secured a new three-year $120 million senior secured asset-based credit facility with White Oak Commercial Finance. The proceeds were used to refinance our existing credit facility, fund working capital, and provide for general corporate purposes. These steps have positioned us well to execute our acquisition strategy and capitalize on future growth opportunities.

“As we look toward fiscal 2025, our focus remains on driving growth through continued expansion and diversification. By adding new exclusive licenses, expanding product categories, and building stronger retail partnerships, we are positioning ourselves to capture new opportunities in the marketplace. Our ongoing investments in cutting-edge technologies like the Sure Sort® X and the AutoStore™ systems are already driving significant efficiency improvements, and we expect these innovations to further streamline our operations and enhance profitability in the quarters ahead.

“With a disciplined approach to reducing expenses, lowering debt, and optimizing inventory management, we are confident in our ability to continue improving EBITDA and inventory turns in the year ahead. Demand for physical music, particularly vinyl and CD sales, remains strong, and we are excited about major upcoming releases and opportunities in this space. As we continue executing our strategy, we believe Alliance Entertainment is operating from a strong foundation that positions us to effectively capitalize on new opportunities and deliver sustained value to both our customers and shareholders.

“We were encouraged by the ongoing improvement in gross profit and gross margin in fiscal year 2024 over the prior year period as our cost-saving initiatives and focus on positive sales continue to yield results. Improvements also led to a fifth consecutive quarter of positive Adjusted EBITDA.”

About 24/7 Market News
As a pioneer in digital financial market media, 24/7 Market News (24/7MN) is dedicated to the swift distribution of financial market news and information. 24/7 MN incorporates comprehensive corporate communications resources and tools to engage the investment community. Visit 24/7 Market News website here.

24/7 MARKET NEWS, INC Disclaimer
Please go to https://247marketnews.com/disclaimer/ for disclaimer information.

CONTACT:
24/7 Market News
Editor@247marketnews.com

Related news for (AENT)

NASDAQ and NYSE quotes and data are delayed 15 minutes unless indicated otherwise. Market data and exchange information are provided for informational purposes only and is not intended for trading purposes. Neither 24/7 Market News Editors, 247 Market News, or data and content providers shall be liable for any errors or omissions, delays, misquotes or other market information relayed in any press materials. You should Use Realtime data to conduct due diligence before investing or trading, and trading in any stock is risky you could lose all your money.