Live Ventures Q1 2025 Earnings Report

Live Ventures EPS Results

• Actual EPS: -$0.74
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Live Ventures Revenue Results

• Actual Revenue: N/A
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Live Ventures Announcement Details

• Quarter: Q1 2025
• Date: 2/6/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, February 6, 2025
• Conference Call Time: 5:00PM ET

Live Ventures (NASDAQ:LIVE) is a diversified holding company that acquires, manages and grows businesses across multiple industry verticals. The company focuses on small- to mid-market enterprises in the United States, targeting sectors where it can leverage operational expertise to drive revenue growth and improve efficiencies. Live Ventures’ investment strategy centers on businesses in e-commerce and direct marketing, consumer finance, industrial products and energy services.

Among its key subsidiaries is Hanover Direct, a direct-to-consumer catalog and e-commerce retailer offering apparel, home décor and beauty products. Live Ventures also operates PeopleLoans.com, an online consumer lending platform providing personal loan solutions, and manages industrial and energy businesses that supply specialty materials and services to niche markets. Through these operating units, the company generates revenue from product sales, marketing services and loan origination fees.

Founded in 2006 and headquartered in Dallas, Texas, Live Ventures trades on the NASDAQ under the symbol LIVE. Under the leadership of President and Chief Executive Officer Matthew Raczka, the company has pursued a roll-up strategy, completing a series of acquisitions to diversify its portfolio and expand its geographic reach. Live Ventures continues to evaluate new acquisition opportunities aimed at enhancing shareholder value and strengthening its market position in North America.

Live Ventures Q1 2025 Earnings Call Transcript

Key Takeaways

• Total revenue fell 5.2% year-over-year to $111.5 million, with declines in the flooring manufacturing, retail flooring and steel manufacturing segments weighing on results.
• Retail entertainment revenue rose 3.3% to $21.3 million thanks to an increase in store count, and the company's overall gross margin improved to 31.7% from 30.9%.
• Reported net income of $0.5 million and EPS of $0.16 versus a loss of $0.7 million and $0.22 per share last year, driven primarily by one-time gains totaling $3.5 million from PMW earn-out and seller note settlements.
• Adjusted EBITDA declined by approximately $3.0 million to $5.7 million compared to the prior year period, reflecting softness in key operating segments.
• The company ended the quarter with $31.1 million in cash availability and repurchased 15,700 shares under its capital allocation strategy, emphasizing confidence in long-term value creation.

Presentation

[Operator]

Welcome to the Live Ventures FY 2025 First Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. I would now like to turn the call over to Greg Powell, Director of Investor Relations. Please go ahead, sir.

[Greg Powell, Director of Investor Relations at Live Ventures]

Thank you, Jen. Good afternoon, and welcome to the Live Ventures First Quarter Fiscal Year 2025 Conference Call. Joining us this afternoon is David Verret, our Chief Financial Officer. Some of the statements we are making today are forward-looking and are based on our best view of our businesses as we see them today. The actual results could differ materially due to a number of factors, including those outlined in our latest forms 10-K and 10-Q, as filed with the Securities and Exchange Commission. We have no obligation to publicly update any forward-looking statements after this call, whether as a result of any new information, future events, changes in assumptions, or otherwise. You can find our press release that we referenced on this call today in the Investor Relations section of the Live Ventures website.

[Greg Powell, Director of Investor Relations at Live Ventures]

I will direct you to our website, liveventures.com or sec.gov, for our historical SEC filings. I will now turn the call over to David to walk you through our financial performance.

[David Verret, CFO at Live Ventures]

Thank you, Greg, and good afternoon, everyone. Let's jump right in and discuss the financial results for the first quarter ended December 31, 2024. Total revenue for the quarter decreased 5.2% to approximately $111.5 million. The decrease is attributable to the Flooring Manufacturing, Retail-Flooring, and Steel Manufacturing segments, which decreased by approximately $6.7 million in the aggregate. Retail-Entertainment revenue increased $700,000, or 3.3% compared to the prior year period, to approximately $21.3 million. The increase in revenue was primarily due to an increase in the number of stores from 70 in Q1 2024 as compared to 73 in Q1 2025. Retail-Flooring segment revenue decreased $2.6 million, or 7.5% compared to the prior year period, to approximately $31.7 million. The decrease is primarily due to reduced demand in the flooring industry.

[David Verret, CFO at Live Ventures]

Flooring manufacturing segment revenue decreased $3.2 million, or 11.1% compared to the prior year period, to approximately $26 million. The decrease in revenue is also primarily due to reduced demand in the flooring industry. Steel manufacturing segment revenue decreased $900,000, or 2.8% compared to the prior year period, to approximately $32.4 million. The decrease is primarily due to reduced consumer demand, partially offset by revenue of $3.1 million at Central Steel, which was acquired in May 2024. Gross profit for the quarter was approximately $35.4 million, a decrease of $1 million compared to the prior year period. The gross margin percentage for the company increased to 31.7% from 30.9% in the prior year period. The increase is primarily attributable to increased margins in our retail-entertainment segment, as well as the steel manufacturing segment, primarily due to product mix.

[David Verret, CFO at Live Ventures]

General and administrative expense increased approximately $2.4 million-$30.1 million. The increase is primarily due to increased compensation and other general administrative expenses in the Retail-Flooring segment. Sales and marketing expense decreased approximately $600,000-$4.5 million. This decrease was primarily due to reduced sales and marketing activities in the Retail-Flooring segment. Interest expense remained constant at $4.2 million in the current quarter as compared to the prior year period. Net income for the quarter was approximately $500,000, and diluted EPS was $0.16, compared to net loss of approximately $700,000 and loss per share of $0.22 in the prior year period. The increase in net income is primarily attributable to a $2.8 million gain on the settlement of the earn-out liability related to the PMW acquisition and a $0.7 million gain on the settlement of PMW seller notes.

[David Verret, CFO at Live Ventures]

Adjusted EBITDA for the quarter was approximately $5.7 million, a decrease of approximately $3 million as compared to the prior year period. Turning to liquidity, we ended the quarter with total cash availability of $31.1 million, consisting of cash on hand of $7.4 million and availability under our various lines of credit, totaling $23.7 million. Our working capital was approximately $51 million as of December 31, 2024, compared to $52.3 million as of September 30, 2024. As of December 31, total assets were $395.5 million, and total stockholders' equity was $73.3 million. As part of our capital allocation strategy, we may make share repurchases from time to time. We believe our stock repurchases represent long-term value for our stockholders. During the quarter, we repurchased approximately 15,700 shares of common stock.

[David Verret, CFO at Live Ventures]

In conclusion, we are pleased that both our retail-entertainment and steel manufacturing segments delivered improved operating performance in the first quarter, with increases in operating revenue and operating margins as compared to the prior year period. However, challenging market conditions continue to impact our retail-flooring and our flooring manufacturing segments as reduced consumer demand weighed on performance. To address this, we are implementing measures to enhance efficiency of our flooring businesses. Despite these challenges, we remain confident in the long-term strategy of our businesses. We will now take questions from those of you on the conference call. Operator, please open the line for questions.

[Operator]

Thank you. At this time, we will conduct the question-and-answer session. If you would like to ask a question, please press Star 1 on your phone now, and you'll be placed into the queue in the order received. Once again, to ask a question, press Star 1 on your phone now. Our first question will come from Joseph Kowalsky with JD Investments.

[Joseph Kowalsky, Analyst at JD Investment Management]

Hello, and nice to see earnings. I just wondered if you could give me some color, give us some color on the settlement, what it relates to, how it works. Is there more to it in the future? Is it a one-time thing?

[David Verret, CFO at Live Ventures]

Sure. Yes. This is a one-time thing. It was our goal to get the sellers kind of completely out of the picture going forward. We had approached them on settling. It was a $2.5 million seller notes, as well as eliminating the earn-out liability, which was a five-year earn-out period. We were able to negotiate with them, paying off the loan early at a discount and forgiving the earn-out for basically, that helped us get about a $3.5 million gain out of the deal.

[Joseph Kowalsky, Analyst at JD Investment Management]

Very nice. Without that, and into the future, how do things look? I mean, obviously, we had losses last year. Do you anticipate losses continuing for this year and in which divisions, or do you anticipate earnings profits?

[David Verret, CFO at Live Ventures]

Yeah. I'll start off with that. We don't kind of give guidance on expectations for projections in the future. I will say that there has been a number of initiatives that we have been implementing across a couple of our entities whose performance has struggled more than others. I think we're pleased with what we're seeing, and we're expecting to see some results of these initiatives that we're enacting here in the near future.

[Joseph Kowalsky, Analyst at JD Investment Management]

Okay. Fair enough. Last question. Anything on the horizon as far as a new company to be added to the portfolio? Are there things that you're working on in the near term as opposed to just looking around out there?

[David Verret, CFO at Live Ventures]

Yeah. There's always opportunities that come up. I'll say that there's really nothing that's hot at the moment that is worthy of discussing.

[Joseph Kowalsky, Analyst at JD Investment Management]

Okay. Thank you very much.

[Operator]

Once again, if you'd like to ask a question, please signal by pressing Star 1 at this time. It appears we have no further questions. Mr. Verret, I'll turn the conference back to you for any additional or closing remarks.

[David Verret, CFO at Live Ventures]

Okay. I just want to thank everyone for attending our Q1 earnings call, and we look forward to giving you an update in Q2. Thank you.

[Operator]

This does conclude today's conference call. Thank you for attending.

Participants

Executives

• Greg Powell, Director of Investor Relations
• David Verret, CFO

Analysts

• Joseph Kowalsky, Analyst at JD Investment Management