FY 2023 Revenue Increased by 32% Year-Over-Year to $120.5 million, with Q4 Revenue
Increasing to $31.7 million
FY 2023 Gross Profit Increased by 40% Year-Over-Year to $40.8 million, with Q4 Gross Profit
Increasing to $11.1 million
Fifth Consecutive Quarter Reporting Positive Adjusted EBITDA
VANCOUVER, BC, March 6, 2024 /CNW/ – Kits Eyecare Ltd. (TSX:KITS) (“KITS” or the “Company”), a leading vertically integrated eyecare provider, is reporting its results for the fourth quarter and full year ended December 31, 2023.
Fourth Quarter 2023 Financial & Operational Highlights
For the fourth quarter of 2023, compared to the fourth quarter of 2022:
Revenue increased by 21% to a record $31.7 million compared to $26.2 million
Gross margin increased by 110 basis points to 35.0% compared to 33.9%
Marketing expenses as a percentage of revenue increased by 50 basis points to 14.2% compared to 13.7%
Fulfillment expenses as a percentage of revenue declined by 60 basis points to 12.6% compared to 13.2%
General and administrative expenses as a percentage of revenue declined 130 basis points to 6.7% compared to 8.0%
Adjusted EBITDA improved by 100% to $0.9 million compared to $0.4 million
Full Year 2023 Financial & Operational Highlights
For the full year 2023, compared to full year 2022:
Revenue increased by 32% to a record $120.5 million compared to $91.6 million
Gross margin increased by 190 basis points to 33.8% compared to 31.9%
Marketing expenses as a percentage of revenue declined by 10 basis points to 14.0% compared to 14.1%
Fulfillment expenses as a percentage of revenue declined by 110 basis points to 12.6% compared to 13.7%
General and administrative expenses as a percentage of revenue declined 210 basis points to 6.7% compared to 8.8%
Adjusted EBITDA improved by 225% to $2.3 million compared to $(1.8) million
Management Commentary
“Q4 was another record setting quarter for the team at KITS as we delivered meaningful progress across customer experience, revenue, margins and Adjusted EBITDA,” said Roger Hardy, Co-Founder and CEO of KITS. “But more importantly, the strength of our core business continued to gain momentum as we continued to improve on the things that have made us leaders in the category. Our focus on quality first, category leading selection, speed and delivering meaningful savings all continued to resonate with customers and allowed us to close out the year with yet another record quarter on the top-line and our fifth consecutive quarter reporting positive Adjusted EBITDA. As we move into 2024, there is no question momentum has continued and our world-class offering is continuing to build momentum. We look forward to updating shareholders on our continued progress as the year unfolds.”
Fourth Quarter 2023 Financial Results
Revenue increased by 21% to $31.7 million compared to $26.2 million in the prior year period. The increase was primarily attributable to strong repeat customer revenue in both contact lens and eyeglasses, higher average order value and a growth in repeat eyeglass customers.
Gross profit increased by 24% to $11.1 million compared to $8.9 million in the prior year period, while gross margin increased by 110 basis points to 35.0% compared to 33.9% in the prior year period. The increase was primarily due to a reduction in promotions to prioritize higher-margin orders and capturing improved margins from returning customers.
Net loss improved to $0.5 million, or $(0.02) per share (basic), compared to a net loss of $1.4 million, or $(0.04) per share (basic), in the prior year period. The improvement was primarily attributable to the higher revenue and gross profit, offset by an increase in foreign exchange loss during the period.
EBITDA increased by 67% to $(0.1) million compared to $(0.3) million in the prior year period, while Adjusted EBITDA improved by 100% to $0.9 million compared to $0.4 million in the prior year period. The improvement in Adjusted EBITDA was primarily attributable to the increase in revenue and gross profit, offset by an increase in foreign exchange loss during the period.
On December 31, 2023, cash and cash equivalents totaled $16.0 million compared to $18.8 million on December 31, 2022.
Conference Call
KITS management will host the conference call followed by a question-and-answer period. To access the call instantly, please click here to register your name and phone number via the rapid connect link.
The conference call will also be webcast live with a presentation and available for replay here and via the investor relations section of the Company’s website at www.kits.com.
Date: Wednesday, March 6, 2024
Time: 9:00 a.m. Eastern time (6:00 a.m. Pacific time)
Presentation webcast link: https://app.webinar.net/vljyepwbBAz
Rapid connect link: https://emportal.ink/3OoP1iF
North American toll-free number: 1-888-664-6392
Local Toronto dial-in number: 416-764-8659
Confirmation #: 71756133
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Group at 1-949-574-3860.
Financial Highlights
The following selected financial information is qualified in its entirety by and should be read conjunction with our consolidated financial statements for the years ended December 31, 2023 and 2022 and accompanying notes and Management’s Discussion and Analysis (“MD&A”) which may be viewed on SEDAR at www.sedar.com.
Three Months Ended
Year Ended
Financial and Operating Data
December 31,
2023
(unaudited)
December 31,
2022
(unaudited)
December 31,
2023
December 31,
2022
Revenue
$
31,663
$
26,239
$
120,510
$
91,639
Net income (loss)
$
(491)
$
(1,385)
$
(2,215)
$
(4,552)
Net income (loss) per share
Basic
$
(0.02)
$
(0.04)
$
(0.07)
$
(0.15)
Diluted