Climb Global Solutions Reports Record Fourth Quarter and Full Year 2024 Results
Rhea-AI Summary
Climb Global Solutions (NASDAQ:CLMB) reported record financial results for Q4 and FY 2024. Fourth quarter highlights include: net sales up 51% to $161.8M, net income increased 33% to $7.0M ($1.52 per share), and adjusted EBITDA grew 75% to $16.1M.
Full year 2024 performance showed substantial growth with net sales rising 32% to $465.6M, net income up 51% to $18.6M ($4.06 per share), and adjusted EBITDA increasing 61% to $39.6M. The company's gross billings reached $1.8B, up 42% from 2023.
The company completed the acquisition of Douglas Stewart Software & Services (DSS) on July 31, 2024, which was immediately accretive to earnings. The Board declared a quarterly dividend of $0.17 per share, payable March 21, 2025. As of December 31, 2024, the company maintained a strong balance sheet with $29.8M in cash and minimal debt of $0.8M.
Positive
- Record Q4 net sales growth of 51% to $161.8M
- FY 2024 net income up 51% to $18.6M
- Adjusted EBITDA increased 61% to $39.6M in FY 2024
- Gross billings grew 42% to $1.8B in FY 2024
- Strong balance sheet with minimal debt ($0.8M)
- DSS acquisition immediately accretive to earnings
Negative
- Solutions segment gross billings decreased 9% to $23.0M in Q4
- Cash and cash equivalents decreased from $36.3M to $29.8M YoY
- Working capital decreased by $9.3M
- $2.5M charge for change in acquisition contingent consideration
News Market Reaction 1 Alert
On the day this news was published, CLMB gained 12.78%, reflecting a significant positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
FY 2024 Net Income up
Q4 & FY 2024 Net Sales, Gross Profit, Net Income, EPS and Adjusted EBITDA Increase to Record Levels
EATONTOWN, N.J., March 05, 2025 (GLOBE NEWSWIRE) -- Climb Global Solutions, Inc. (NASDAQ:CLMB) (“Climb” or the “Company”), a value-added global IT channel company providing unique sales and distribution solutions for innovative technology vendors, is reporting results for the fourth quarter and full year ended December 31, 2024.
Fourth Quarter 2024 Summary vs. Same Year-Ago Quarter
- Net sales increased
51% to$161.8 million . - Net income increased
33% to$7.0 million or$1.52 per diluted share. - Adjusted net income (a non-GAAP financial measure defined below) increased
87% to$10.3 million or$2.26 per diluted share. - Adjusted EBITDA (a non-GAAP financial measure defined below) increased
75% to$16.1 million . - Gross billings (a key operational metric defined below) increased
52% to$605.0 million . Distribution segment gross billings increased57% to$582.0 million , and Solutions segment gross billings decreased9% to$23.0 million .
FY 2024 Summary vs. FY 2023
- Net sales increased
32% to$465.6 million . - Net income increased
51% to$18.6 million or$4.06 per diluted share. - Adjusted net income (a non-GAAP financial measure defined below) increased
64% to$24.0 million or$5.26 per diluted share. - Adjusted EBITDA (a non-GAAP financial measure defined below) increased
61% to$39.6 million . - Gross billings (a key operational metric defined below) increased
42% to$1.8 billion . Distribution segment gross billings increased44% to$1.7 billion , and Solutions segment gross billings increased7% to$89.8 million .
Management Commentary
“Our fourth quarter performance capped off an exceptional 2024, marking another year of record results across all key financial metrics,” said CEO Dale Foster. “Throughout the year, we evaluated over 120 vendors and signed agreements with only 13 of them, demonstrating our commitment to partnering with the most innovative technologies in the market. We also added scale and expertise to our North America operations through the acquisition of Douglas Stewart Software & Services, LLC (“DSS”), which was immediately accretive to earnings. I’m proud of our team’s hard work in generating double-digit organic growth in both the U.S. and Europe, reinforcing our commitment to deepening relationships with our partners across our global footprint.
“Looking ahead, we have a solid foundation in place to continue driving strong organic growth while further improving operating leverage through the implementation of our ERP system. We will also continue to evaluate M&A opportunities that can enhance our service and solutions offerings, as well as expand our geographic footprint in the U.S. and overseas. These initiatives, coupled with our demonstrated track record of execution and a robust balance sheet, will enable us to deliver on our organic and inorganic growth initiatives in 2025.”
Dividend
Subsequent to quarter end, on February 28, 2025, Climb’s Board of Directors declared a quarterly dividend of
Fourth Quarter 2024 Financial Results
Net sales in the fourth quarter of 2024 increased
Gross profit in the fourth quarter of 2024 increased
Selling, general, and administrative (“SG&A”) expenses in the fourth quarter of 2024 were
Net income in the fourth quarter of 2024 increased
Adjusted EBITDA in the fourth quarter of 2024 increased
On December 31, 2024, cash and cash equivalents were
For more information on the non-GAAP financial measures discussed in this press release, please see the section titled, “Non-GAAP Financial Measures,” and the reconciliations of non-GAAP financial measures to their nearest comparable GAAP financial measures at the end of this press release.
Conference Call
The Company will conduct a conference call tomorrow, March 6, 2025, at 8:30 a.m. Eastern time to discuss its results for the fourth quarter and full year ended December 31, 2024.
Climb management will host the conference call, followed by a question-and-answer period.
Date: Thursday, March 6, 2025
Time: 8:30 a.m. Eastern time
Toll-free dial-in number: (800) 225-9448
International dial-in number: (203) 518-9708
Conference ID: CLIMB
Webcast: Climb’s Q4 & FY 2024 Conference Call
If you have any difficulty registering or connecting with the conference call, please contact Elevate IR at (720) 330-2829.
The conference call will also be available for replay on the investor relations section of the Company’s website at www.climbglobalsolutions.com.
About Climb Global Solutions
Climb Global Solutions, Inc. (NASDAQ:CLMB) is a value-added global IT distribution and solutions company specializing in emerging and innovative technologies. Climb operates across the US, Canada and Europe through multiple business units, including Climb Channel Solutions, Grey Matter and Climb Global Services. The Company provides IT distribution and solutions for companies in the Security, Data Management, Connectivity, Storage & HCI, Virtualization & Cloud, and Software & ALM industries.
Additional information can be found by visiting www.climbglobalsolutions.com.
Non-GAAP Financial Measures
Climb Global Solutions uses non-GAAP financial measures, including adjusted net income and adjusted EBITDA, as supplemental measures of the performance of the Company’s business. Use of these financial measures has limitations, and you should not consider them in isolation or use them as substitutes for analysis of Climb’s financial results under generally accepted accounting principles in the United States of America (“U.S. GAAP”). The attached tables provide definitions of these measures and a reconciliation of each non-GAAP financial measure to the most nearly comparable measure under U.S. GAAP.
Key Operational Metric
Gross Billings
Gross billings are the total dollar value of customer purchases of goods and services during the period, net of customer returns and credit memos, sales, or other taxes. Gross billings include the transaction values for certain sales transactions that are recognized on a net basis, and, therefore, includes amounts that will not be recognized as revenue. We use gross billings as an operational metric to assess the volume of transactions or market share for our business as well as to understand changes in our accounts receivable and accounts payable. We believe gross billings will aid investors in the same manner.
Forward-Looking Statements
The statements in this release, other than statements of historical fact, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and are intended to come within the safe harbor protection provided by those sections. These forward-looking statements are subject to certain risks and uncertainties. Many of the forward-looking statements may be identified by words such as ”look forward,” “believes,” “expects,” “intends,” “anticipates,” “plans,” “estimates,” “projects,” “forecasts,” “should,” “could,” “would,” “will,” “confident,” “may,” “can,” “potential,” “possible,” “proposed,” “in process,” “under construction,” “in development,” “opportunity,” “target,” “outlook,” “maintain,” “continue,” “goal,” “aim,” “commit,” or similar expressions, or when we discuss our priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations. In this press release, the forward-looking statements relate to, among other things, declaring and reaffirming our strategic goals, future operating results, and the effects and potential benefits of the strategic acquisition on our business. Factors, among others, that could cause actual results and events to differ materially from those described in any forward-looking statements include, without limitation, our ability to recognize the anticipated benefits of the acquisitions of Data Solutions Holdings Limited and Douglas Stewart Software & Services, LLC, the continued acceptance of the Company’s distribution channel by vendors and customers, the timely availability and acceptance of new products, product mix, market conditions, competitive pricing pressures, the successful integration of acquisitions, contribution of key vendor relationships and support programs, inflation, interest rate risk and impact thereof, as well as factors that affect the software industry in general. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described in the section entitled “Risk Factors” contained in Item 1A. of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and from time to time in the Company’s filings with the Securities and Exchange Commission.
Company Contact
Matthew Sullivan
Chief Financial Officer
(732) 847-2451
MatthewS@ClimbCS.com
Investor Relations Contact
Sean Mansouri, CFA or Aaron D’Souza
Elevate IR
(720) 330-2829
CLMB@elevate-ir.com
| CLIMB GLOBAL SOLUTIONS, INC. AND SUBSIDIARIES | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (Unaudited) | ||||||||
| (Amounts in thousands, except share and per share amounts) | ||||||||
| December 31, 2024 | December 31, 2023 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 29,778 | $ | 36,295 | ||||
| Accounts receivable, net of allowance for doubtful accounts of | 341,597 | 222,269 | ||||||
| Inventory, net | 2,447 | 3,741 | ||||||
| Prepaid expenses and other current assets | 6,874 | 6,755 | ||||||
| Total current assets | 380,696 | 269,060 | ||||||
| Equipment and leasehold improvements, net | 12,853 | 8,850 | ||||||
| Goodwill | 34,924 | 27,182 | ||||||
| Other intangibles, net | 36,550 | 26,930 | ||||||
| Right-of-use assets, net | 1,965 | 878 | ||||||
| Accounts receivable long-term, net | 1,174 | 797 | ||||||
| Other assets | 824 | 1,077 | ||||||
| Deferred income tax assets | 193 | 324 | ||||||
| Total assets | $ | 469,179 | $ | 335,098 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | 370,397 | $ | 249,648 | ||||
| Lease liability, current portion | 654 | 450 | ||||||
| Term loan, current portion | 560 | 540 | ||||||
| Total current liabilities | 371,611 | 250,638 | ||||||
| Lease liability, net of current portion | 1,685 | 879 | ||||||
| Deferred income tax liabilities | 4,723 | 5,554 | ||||||
| Term loan, net of current portion | 191 | 752 | ||||||
| Non-current liabilities | 381 | 2,505 | ||||||
| Total liabilities | 378,591 | 260,328 | ||||||
| Stockholders' equity | ||||||||
| Common stock, $.01 par value; 10,000,000 shares authorized, 5,284,500 shares | ||||||||
| issued, and 4,601,302 and 4,573,448 shares outstanding , respectively | 53 | 53 | ||||||
| Additional paid-in capital | 37,977 | 34,647 | ||||||
| Treasury stock, at cost, 683,198 and 711,052 shares, respectively | (13,337 | ) | (12,623 | ) | ||||
| Retained earnings | 68,787 | 53,215 | ||||||
| Accumulated other comprehensive loss | (2,892 | ) | (522 | ) | ||||
| Total stockholders' equity | 90,588 | 74,770 | ||||||
| Total liabilities and stockholders' equity | $ | 469,179 | $ | 335,098 | ||||
| CLIMB GLOBAL SOLUTIONS, INC. AND SUBSIDIARIES | |||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| (Amounts in thousands, except per share data) | |||||||||||||||||
| Year ended | Three months ended | ||||||||||||||||
| December 31, | December 31, | ||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||
| Net Sales | $ | 465,607 | $ | 352,013 | $ | 161,760 | $ | 106,783 | |||||||||
| Cost of sales | 374,527 | 287,766 | 130,513 | 85,713 | |||||||||||||
| Gross profit | 91,080 | 64,247 | 31,247 | 21,070 | |||||||||||||
| Selling, general and administrative expenses | 56,508 | 44,330 | 17,075 | 12,400 | |||||||||||||
| Depreciation & amortization expense | 4,269 | 2,798 | 1,336 | 864 | |||||||||||||
| Acquisition related costs | 2,311 | 629 | 1,110 | 352 | |||||||||||||
| Total selling, general and administrative expenses | 63,088 | 47,757 | 19,521 | 13,616 | |||||||||||||
| Income from operations | 27,992 | 16,490 | 11,726 | 7,454 | |||||||||||||
| Interest, net | 917 | 927 | 162 | 168 | |||||||||||||
| Foreign currency transaction (loss) gain | (273 | ) | (636 | ) | 415 | (536 | ) | ||||||||||
| Change in fair value of acquisition contingent consideration | (3,618 | ) | - | (2,466 | ) | - | |||||||||||
| Income before provision for income taxes | 25,018 | 16,781 | 9,837 | 7,086 | |||||||||||||
| Provision for income taxes | 6,408 | 4,458 | 2,847 | 1,840 | |||||||||||||
| Net income | $ | 18,610 | $ | 12,323 | $ | 6,990 | $ | 5,246 | |||||||||
| Income per common share - Basic | $ | 4.06 | $ | 2.72 | $ | 1.52 | $ | 1.15 | |||||||||
| Income per common share - Diluted | $ | 4.06 | $ | 2.72 | $ | 1.52 | $ | 1.15 | |||||||||
| Weighted average common shares outstanding - Basic | 4,465 | 4,401 | 4,485 | 4,427 | |||||||||||||
| Weighted average common shares outstanding - Diluted | 4,465 | 4,401 | 4,485 | 4,427 | |||||||||||||
| Dividends paid per common share | $ | 0.68 | $ | 0.68 | $ | 0.17 | $ | 0.17 | |||||||||
| Reconciliation of GAAP and Non-GAAP Financial Measures (unaudited) | |||||||||||||||||
| (Amounts in thousands, except per share data) | |||||||||||||||||
| The table below presents net income reconciled to adjusted EBITDA (Non-GAAP) (1): | |||||||||||||||||
| Year ended | Three months ended | ||||||||||||||||
| December 31, | December 31, | December 31, | December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||
| Net income | $ | 18,610 | $ | 12,323 | $ | 6,990 | $ | 5,246 | |||||||||
| Provision for income taxes | 6,408 | 4,458 | 2,847 | 1,840 | |||||||||||||
| Depreciation and amortization | 4,269 | 2,798 | 1,336 | 864 | |||||||||||||
| Interest expense | 335 | 264 | 69 | 170 | |||||||||||||
| EBITDA | 29,622 | 19,843 | 11,242 | 8,120 | |||||||||||||
| Share-based compensation | 4,070 | 4,148 | 1,260 | 726 | |||||||||||||
| Acquisition related costs | 2,311 | 629 | 1,110 | 352 | |||||||||||||
| Change in fair value of acquisition contingent consideration | 3,618 | - | 2,466 | - | |||||||||||||
| Adjusted EBITDA | $ | 39,621 | $ | 24,620 | $ | 16,078 | $ | 9,198 | |||||||||
| Year ended | Three months ended | ||||||||||||||||
| December 31, | December 31, | December 31, | December 31, | ||||||||||||||
| Components of interest, net | 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Amortization of discount on accounts receivable with extended payment terms | $ | (34 | ) | $ | (50 | ) | $ | (11 | ) | $ | (9 | ) | |||||
| Interest income | (1,218 | ) | (1,141 | ) | (220 | ) | (329 | ) | |||||||||
| Interest expense | 335 | 264 | 69 | 170 | |||||||||||||
| Interest, net | $ | (917 | ) | $ | (927 | ) | $ | (162 | ) | $ | (168 | ) | |||||
(1) We define adjusted EBITDA, as net income, plus provision for income taxes, depreciation, amortization, share-based compensation, interest, acquisition related costs and change in fair value of acquisition contingent consideration. We define effective margin as adjusted EBITDA as a percentage of gross profit. We provided a reconciliation of adjusted EBITDA to net income, which is the most directly comparable US GAAP measure. We use adjusted EBITDA as a supplemental measure of our performance to gain insight into our businesses profitability, operating performance and performance trends, and to provide management and investors a useful measure for period-to-period comparisons by excluding items that management believes are not reflective of our underlying operating performance. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results. Adjusted EBITDA is also a component to our financial covenants in our credit facility. Our use of adjusted EBITDA has limitations, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under US GAAP. In addition, other companies, including companies in our industry, might calculate adjusted EBITDA, or similarly titled measures differently, which may reduce their usefulness as comparative measures.
| The table below presents net income reconciled to adjusted net income (Non-GAAP) (2): | |||||||||||||
| Year ended | Three months ended | ||||||||||||
| December 31, | December 31, | December 31, | December 31, | ||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||
| Net income | $ | 18,610 | $ | 12,323 | $ | 6,990 | $ | 5,246 | |||||
| Acquisition related costs, net of income taxes | 1,733 | 472 | 833 | 264 | |||||||||
| One-time CEO stock grant | - | 1,796 | - | - | |||||||||
| Change in fair value of acquisition contingent consideration | 3,618 | - | 2,466 | - | |||||||||
| Adjusted net income | $ | 23,961 | $ | 14,591 | $ | 10,289 | $ | 5,510 | |||||
| Adjusted net income per common share - diluted | $ | 5.26 | $ | 3.24 | $ | 2.26 | $ | 1.21 | |||||
(2) We define adjusted net income as net income excluding acquisition related costs, net of income taxes, the stock compensation expense recognized for the one-time CEO stock grant, and the change in fair value of acquisition contingent consideration. We provided a reconciliation of adjusted net income to net income, which is the most directly comparable U.S. GAAP measure. We use adjusted net income and adjusted net income per common share as supplemental measures of our performance to gain insight into our businesses profitability, operating performance and performance trends, and to provide management and investors a useful measure for period-to-period comparisons by excluding items that management believes are not reflective of our underlying operating performance. Accordingly, we believe that adjusted net income and adjust net income per common share provide useful information to investors and others in understanding and evaluating our operating results. Our use of adjusted net income has limitations, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under U.S. GAAP. In addition, other companies, including companies in our industry, might calculate adjusted net income, or similarly titled measures differently, which may reduce their usefulness as comparative measures.
| The table below presents the operational metric of gross billings by segment (3): | |||||||||||||
| Year ended | Three months ended | ||||||||||||
| December 31, | December 31, | December 31, | December 31, | ||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||
| Distribution gross billings | $ | 1,695,538 | $ | 1,176,866 | $ | 581,963 | $ | 371,673 | |||||
| Solutions gross billings | 89,764 | 83,516 | 23,045 | 25,370 | |||||||||
| Total gross billings | $ | 1,785,302 | $ | 1,260,382 | $ | 605,008 | $ | 397,043 | |||||
(3) Gross billings are the total dollar value of customer purchases of goods and services during the period, net of customer returns and credit memos, sales, or other taxes. Gross billings include the transaction values for certain sales transactions that are recognized on a net basis, and, therefore, include amounts that will not be recognized as revenue. We use gross billings as an operational metric to assess the volume of transactions or market share for our business as well as to understand changes in our accounts receivable and accounts payable. We believe gross billings will aid investors in the same manner.
FAQ
What were Climb Global Solutions (CLMB) key financial metrics for Q4 2024?
How much did CLMB's gross billings grow in FY 2024?
What is the latest dividend announcement for CLMB stock?
How did CLMB's acquisition of DSS impact Q4 2024 results?
What is CLMB's cash position and debt level as of December 31, 2024?
