Holley (HLLY) Raymond James TMT and Consumer Conference summary

Company overview and market position

• Operates as a leading designer, marketer, and manufacturer of automotive aftermarket parts and accessories, serving a $40 billion U.S. market with a broad portfolio of brands.

• Shifted focus post-Great Recession from OEM supply to performance aftermarket, doubling down on enthusiast-driven products and lifestyle branding.

• Expanded through acquisitions, especially in safety and racing, and now leads in multiple product categories, including global safety equipment.

• Serves nearly 70 million U.S. automotive enthusiasts, with annual spending habits and high engagement through events and direct marketing.

• Structured into four verticals: Domestic Muscle, Truck & Off-Road, Euro & Import, and Safety & Racing, each with dedicated leadership to drive growth.

Strategic transformation and operational improvements

• Professionalized management and processes to support multi-billion-dollar growth ambitions, including digital modernization and CRM implementation.

• Direct-to-consumer business outperformed a declining market, driven by improved data, SEO/SEM, and merchandising.

• Enhanced B2B sales and national retailer partnerships, resulting in year-over-year growth in those channels.

• Instituted a disciplined product development process, increasing new product revenue by 25% year-over-year.

• Established a pricing department to optimize competitiveness and enforce MAP pricing, supporting distributor relationships.

Financial performance and efficiency

• Generates $40–$50 million in free cash flow annually, with EBITDA around 20% and gross margin at 40%.

• Reduced leverage by prepaying $75 million in debt since September of the previous year; implemented a covenant-lite debt structure.

• Achieved $6.7 million in cost-to-serve savings year-to-date, with prior year savings of $25–$30 million.

• Maintained margins near 20% despite revenue declines, aided by operational efficiencies and proactive cost management.

• Ended the year with about $50 million in cash and low revolver usage, prioritizing cash for strategic M&A.