Jowell Global Ltd. Q1 FY2026 earnings call

Mike Pilaro started by highlighting Q1's impressive performance with branded, consolidated revenue, and adjusted EBITDA growth. He discussed market performances: China with over 55% constant currency revenue growth, US with almost 9% constant currency growth, Canada with 4% revenue increase, and international business growth over 20%. Chris Snowden then detailed financials: consolidated revenue up 16.3% to $169.8M, gross profit up almost $14M to $69M, gross profit margin up 290 basis points, SG&A expenses up 6%, earnings from operations up 23%, adjusted EBITDA up 17.6%, net earnings almost $10M, adjusted net earnings $7.4M, adjusted diluted EPS 17 cents up, cash flow used in ops $5.8M vs $31.6M prior year, cash from ops before WC up nearly $8M YOY, cash invested in WC $45.3M, and quarterly dividend announcement

Branded revenue grew almost 16%. Consolidated revenue grew just over 16%, and adjusted EBITDA grew by nearly 18%. Jameson Brands' revenue increased by 15.6% to almost $152 million. China revenue grew more than 55% on a constant currency basis, driven by performance marketing, innovation, and expanding brand loyalty. US business grew almost 9% on a constant currency basis, with strength in e-commerce and traditional channels. Canada revenue increased 4% driven by consumer consumption, quality-focused marketing, and innovation. International business grew just over 20% led by core markets and distribution gains. Strategic partner revenue increased over 22% to almost $18 million. Consolidated gross profit increased by almost $14 million to $69 million, with consolidated gross profit margin increasing 290 basis points. Jameson brands' normalized gross margin increased by 220 basis points to almost 44%, strategic partners' normalized gross margin increased by 240 basis points. SG&A expenses increased 6%. Earnings from operations increased 23% to $15 million, adjusted EBITDA increased 17.6% to over $22 million. Net earnings were almost $10 million, adjusted net earnings increased to $7.4 million, adjusted diluted earnings per share were 17 cents up over a year. Cash flow used in operation activities was $5.8 million vs $31.6 million generated prior year. Cash from operating activities before working capital considerations was nearly $8 million higher year over year. Cash invested in working capital $45.3 million. At quarter end, had almost $94 million in cash and available operating facilities. Announced quarterly dividend of 23 cents per common share

Reaffirmed full-year 2026 consolidated guidance: revenues $895 - $935M, adjusted EBITDA $174 - $181M, adjusted diluted EPS $2.08 - $2.21. Updated Jameson Brands revenue guidance to 9.4 - 13.6% growth to ~$795 - $825M, strategic partners guidance to 5 - 15% growth. Q2 2026 expected consolidated revenue ~$220 - $228M, Jameson Brand's revenue 13 - 17% increase, Strategic Partners' revenue decline up to 10% due to customer program timing. Adjusted EBITDA for Q2 ~$36 - $38.5M

Q: Cheryl Shang from TD Cowen asked about China performance by channels and repeat purchase/trial conversion.

A: Mike and Chris said strong double-digit growth across e-commerce and brick-and-mortar, and trial conversion increases continue.

Q: BMO Capital Markets' Nevin asked about U.S. consumer strength, patterns, and Q2 trends.

A: Mike said no major shifts seen, strong e-commerce growth and core product demand.

Q: CBC's question about trade down and discount retail channels.

A: Mike said no major trade-down, outpaced market, strong in discount channels.

Q: National Bank Financial's Nathan asked about working capital investment and tariffs.

A: Chris said it's about safety stock and facility level loading.

Q: Tanya Armstrong from Canaccord Genuity asked about China margin outperformance and U.S. tariff risks.

A: Mike said disciplined investment and performance marketing, Chris said tariff risk minimal due to flexible supply chain.

Q: RBC Capital Markets' Rylan asked about younger demographics in VMS and U.S. social commerce from China.

A: Mike said younger demographics entering via various apertures and resonating with quality messaging, and learnings from China applied to TikTok Shop in U.S.

Q: Max Chelescudi from Spiegel asked about free cash flow conversion and capital allocation.

A: David Miller said free cash flow profile not as severe in Q1 going forward, M&A opportunistic with allocation tied to business investment, M&A, and NCIB