FGI Industries Ltd. Q4 FY2024 earnings call

• FGI's fourth quarter results reflect strategic investments in organic growth initiatives (BPC strategy) with revenue growth above market. - Revenue growth across all businesses and geographies. - Bath Furniture saw growth due to market-aligned pricing and new business wins. - Shower Systems had positive demand trends supported by new customer programs. - Covered Bridge and Ayla Porter joint venture showing momentum. - Geographic expansion in Europe and India holds promise. - Working with suppliers and customers to navigate tariff environment.

FGI reported total revenue of $35.6 million in the fourth quarter, a year-over-year increase of 15%. Gross profit was $8.7 million, a decrease of 3.2% compared to the prior year. Gross margin was 24.6% vs. 29.2% in the prior year. Revenue grew 14.7% in the US, 9.9% in Canada, and 23.3% in Europe markets in the quarter. Sanofi revenue increased 5.8% YOY. Bath Furniture revenue was up 40.2% YOY. Shower Systems revenue increased 17%. Covered Bridge revenue in custom kitchen cabinetry grew 68.3% driven by order momentum, expanded geographies, and higher dealer count.

• 2025 revenue guidance: $135 to $145 million. - Adjusted operating income guidance: negative $2 million to positive $1.5 million. - Adjusted net income guidance: negative $1.9 million to positive $1 million. Guidance includes consideration of tariff pressures and other factors.

• Tariff environment is fluid and could impact business. - Need to navigate tariff pressures and diversify sourcing to mitigate impacts.

Q: Could you elaborate more on the expected impact of tariffs on the business and how you're working to remediate impacts?

A: We've been working closely with suppliers and customers to mitigate costs, diversifying sourcing, and will navigate through tariffs as we've done before.

Q: Can you walk through the components of the operating income outlook?

A: Guidance balances tariff pressure, new growth initiatives, and other factors, with new programs and business wins providing a buffer to flat market outlook.