PetIQ (PETQ) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales increased 4.6% to $328.9 million, driven by strong demand in the Products segment and growth in mobile community clinics within Services.

• Net income attributable to PetIQ, Inc. was $15.3 million for Q2 2024, up 51.1% year-over-year; diluted EPS was $0.49 compared to $0.32.

• Adjusted EBITDA reached $39.0 million, up 19% year-over-year and exceeding guidance.

• Entered a definitive merger agreement with Bansk Group affiliates for $31.00 per share in cash; closing expected in Q4 2024.

Financial highlights

• Q2 2024 net sales: $328.9 million (+4.6% year-over-year); Products: $291.2 million (+4.7%), Services: $37.7 million (+3.7%).

• Gross profit: $88.3 million (+19.5% year-over-year); gross margin: 26.8% (up 330 bps).

• Operating income: $25.6 million (Q2 2024) vs. $18.7 million (Q2 2023).

• Adjusted net income for Q2 was $22.7 million (adjusted EPS $0.70), up 52.2% year-over-year.

• Adjusted EBITDA for Q2 2024: $39.0 million, up from $32.9 million in Q2 2023.

Outlook and guidance

• Merger with Bansk Group expected to close in Q4 2024, subject to regulatory and shareholder approvals.

• Company plans to close 46 wellness centers in Q3 2024 and convert 87 centers to community clinics in Q4 2024, incurring ~$10 million in restructuring charges.

• 2024 financial outlook suspended due to pending acquisition; no further earnings calls planned.