The Duckhorn Portfolio (NAPA) Q4 2024 earnings summary

Executive summary

• Fourth quarter net sales rose 7.3% to $107.4 million, driven by the Sonoma-Cutrer acquisition, while adjusted EBITDA increased 16.7% to $39.9 million.

• Fiscal year 2024 net sales grew 0.7% to $405.5 million; adjusted EBITDA increased 7.3% to $155.1 million.

• Adjusted net income for Q4 was $20.4 million ($0.14 per diluted share), up from $16.7 million last year; full-year adjusted net income was $74.8 million ($0.60 per diluted share), down 3.2% year-over-year.

• Integration of Sonoma-Cutrer and execution of strategic initiatives position the company for future growth.

Financial highlights

• Q4 gross profit was $51.3 million, down 7.2% year-over-year; adjusted gross profit was $55.0 million, flat versus last year.

• Q4 gross margin declined to 47.8% from 55.2%; adjusted gross margin was 51.2% versus 55.1% last year.

• Fiscal year gross profit was $214.9 million, down 0.4%; adjusted gross profit was $217.4 million, also down 0.4%.

• Q4 net income was $11.3 million ($0.08 per diluted share), down from $17.8 million ($0.15 per share) last year.

• Cash at year-end was $10.9 million; leverage ratio was 2.0x net debt to trailing twelve months adjusted EBITDA.

Segment performance

• Q4 net sales growth of 7.3% was driven by 23.7% volume growth from Sonoma-Cutrer, offset by a 16.4% negative price/mix due to timing of Kosta Browne release and lower price points for white varietals.

• Excluding Sonoma-Cutrer, Q4 net sales declined 13.9% year-over-year due to timing shifts.

• Wholesale and DTC channels showed varied performance, with DTC net sales representing 13.9% of Q4 sales.