Converge Solutions (CTS) Q4 2024 earnings summary

Executive summary

• Q4 2024 gross sales rose 2.5% year-over-year to $1.11 billion; revenue up 4.6% to $680.8 million.

• Fiscal 2024 gross sales increased 2.1% to $4.12 billion, but revenue declined 4.2% to $2.59 billion.

• Net loss for fiscal 2024 was $181.0 million, mainly due to a $176.1 million non-cash impairment in the Germany segment.

• Adjusted EBITDA for Q4 grew 3.0% to $47.9 million; for the year, it decreased 1.7% to $167.3 million.

• On February 7, 2025, Converge agreed to be acquired by H.I.G. Capital for $5.50 per share, a 56% premium to the prior closing price.

Financial highlights

• Q4 gross profit fell 1.6% year-over-year to $178.6 million; gross margin was 26.2%.

• Fiscal 2024 gross profit decreased 1.6% to $691.4 million; gross margin held at 26.7%.

• Adjusted net income for Q4 was $45.6 million (up from $38.2 million); for the year, $130.3 million (up from $108.4 million).

• Cash from operating activities in Q4 was $57.0 million, down from $114.5 million; for the year, $269.4 million, up from $229.5 million.

• Returned $82.3 million to shareholders in 2024, up from $23.5 million in 2023.

Outlook and guidance

• No outlook for 2025 provided due to the pending acquisition by H.I.G. Capital; regular quarterly dividend suspended during the transaction process.