Compass Diversified Holdings Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>Compass Diversified Holdings filed its Q1 2024 10-Q, reporting $14.78 billion in assets and $12.63 billion in debt.</b>

AI Summary

Compass Diversified Holdings (CODI-PC) filed a Quarterly Report (10-Q) with the SEC on May 1, 2024. Compass Diversified Holdings reported total assets of $14,783 million as of March 31, 2024. Total debt for Compass Diversified Holdings was $12,634 million as of March 31, 2024. The company's cash and cash equivalents stood at $4,008 million as of March 31, 2024. Revenue for the period ending March 31, 2024, was $10,416 million. Net income for the period ending March 31, 2024, was $500,000.

Why It Matters

For investors and stakeholders tracking Compass Diversified Holdings, this filing contains several important signals. The filing provides a detailed look at the company's financial position as of the end of the first quarter, including asset and liability levels. Key financial metrics such as revenue, net income, and cash reserves are disclosed, offering insights into the company's operational performance and liquidity.

Risk Assessment

Risk Level: medium — Compass Diversified Holdings shows moderate risk based on this filing. The company has a significant amount of debt ($12.63 billion) relative to its assets ($14.78 billion), which could pose financial risks if market conditions or operational performance deteriorate.

Analyst Insight

Investors should monitor the company's debt levels and its ability to service this debt in light of its cash reserves and revenue generation.

Financial Highlights

revenue

10,416

total Assets

14,783

total Debt

12,634

net Income

500,000

cash Position

4,008

Key Numbers

• 10,416 — Revenue (For the period ending March 31, 2024)
• 9,161 — Revenue (For the period ending March 31, 2023)
• 14,783 — Total Assets (As of March 31, 2024)
• 13,779 — Total Assets (As of December 31, 2023)
• 500,000 — Net Income (For the period ending March 31, 2024)
• 50,000 — Net Income (For the period ending March 31, 2023)
• 12,634 — Total Debt (As of March 31, 2024)
• 12,600 — Total Debt (As of December 31, 2023)

Key Players & Entities

• Compass Diversified Holdings (company) — Filer
• 301 RIVERSIDE AVENUE (location) — Business Address
• WESTPORT (location) — Business Address City
• CT (location) — Business Address State
• 06880 (location) — Business Address Zip
• 203-221-1703 (phone) — Business Phone

FAQ

Key Dates

• 2024-03-31: Quarter End — Reporting period for the 10-Q filing.
• 2024-05-01: Filing Date — Date the 10-Q was filed with the SEC.

Key Financial Figures

• $600 million — evolving Credit Facility" refers to the $600 million in revolving loans, swing line loans an
• $400 million — 027; the "2022 Term Loan" refer to the $400 million term loan provided by the 2022 Credit F

Filing Documents

• codi-20240331.htm (10-Q) — 2155KB
• a03312024-ex311.htm (EX-31.1) — 9KB
• a03312024-ex312.htm (EX-31.2) — 10KB
• a03312024-ex321.htm (EX-32.1) — 6KB
• a03312024-ex322.htm (EX-32.2) — 6KB
• 0001345126-24-000028.txt (&nbsp;) — 11196KB
• codi-20240331.xsd (EX-101.SCH) — 64KB
• codi-20240331_cal.xml (EX-101.CAL) — 95KB
• codi-20240331_def.xml (EX-101.DEF) — 702KB
• codi-20240331_lab.xml (EX-101.LAB) — 717KB
• codi-20240331_pre.xml (EX-101.PRE) — 797KB
• codi-20240331_htm.xml (XML) — 1581KB

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS 4

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS (UNAUDITED)

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED) CONDENSED CONSOLIDATED BALANCE SHEETS 5 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS 6 CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 7 CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY 8 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 9 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 11

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 38

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 64

CONTROLS AND PROCEDURES

ITEM 4. CONTROLS AND PROCEDURES 64

OTHER INFORMATION 65

PART II. OTHER INFORMATION 65

LEGAL PROCEEDINGS

ITEM 1. LEGAL PROCEEDINGS 65

RISK FACTORS

ITEM 1A. RISK FACTORS 65

EXHIBITS

ITEM 6. EXHIBITS 66

SIGNATURES

SIGNATURES 68 2 NOTE TO READER In reading this Quarterly Report on Form 10-Q, references to: the "Trust" and "Holdings" refer to Compass Diversified Holdings; the "LLC" refer to Compass Group Diversified Holdings LLC; the "Company" refer to Compass Diversified Holdings and Compass Group Diversified Holdings LLC, collectively; "businesses", "operating segments", "subsidiaries" and "reporting units" all refer to, collectively, the businesses controlled by the Company; the "Manager" refer to Compass Group Management LLC ("CGM"); the "Trust Agreement" refer to the Third Amended and Restated Trust Agreement of the Trust dated as of August 3, 2021; the "2022 Credit Facility" refer to the third amended and restated credit agreement entered into on July 12, 2022 among the LLC, the lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, Swing Line Lender and letter of credit issuer (the "agent") the "2022 Revolving Credit Facility" refers to the $600 million in revolving loans, swing line loans and letters of credit provided by the 2022 Credit Facility that matures in 2027; the "2022 Term Loan" refer to the $400 million term loan provided by the 2022 Credit Facility; the "LLC Agreement" refer to the Sixth Amended and Restated Operating Agreement of the Company dated as of August 3, 2021, as further amended; and "we," "us" and "our" refer to the Trust, the Company and the businesses together. 3

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q, contains both historical and forward-looking statements. We may, in some cases, use words such as "project," "predict," "believe," "anticipate," "plan," "expect," "estimate," "intend," "should," "would," "could," "potentially," "may," or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. All statements other than statements of historical or current fact are "forward-looking statements" for purposes of federal and state securities laws . Forward looking statements include, among other things, (i) statements as to our future performance or liquidity, such as expectations for our results of operation, net income, adjusted EBITDA, adjusted earnings, and ability to make quarterly distributions and (ii) our plans, strategies and objectives for future operations, including our business outlook and planned capital expenditures. Forward-looking statements in this Quarterly Report on Form 10-Q are subject to a number of risks and uncertainties, such as those disclosed or incorporated by reference in our filings with the SEC, including, but not limited to, those described under the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the United States Securities and Exchange Commission ("SEC") on February 28, 2024, as such factors may be updated from time to time in our filings with the SEC. Many of these risks and uncertainties are beyond our control . Important factors that could cause our actual results, performance and achievements to differ materially from those estimates or projections contained in our forward-looking statements include, among other things: changes in general economic, political or business conditions or economic, political or demographic trends in the United States and other countries in which we have a presence, including changes in interest rates and inflation; disrup

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS COMPASS DIVERSIFIED HOLDINGS CONDENSED CONSOLIDATED BALANCE SHEETS March 31, 2024 December 31, 2023 (in thousands) (Unaudited) Assets Current assets: Cash and cash equivalents $ 64,715 $ 450,477 Accounts receivable, net 338,310 318,241 Inventories, net 788,809 740,387 Prepaid expenses and other current assets 126,764 94,715 Total current assets 1,318,598 1,603,820 Property, plant and equipment, net 191,869 192,562 Goodwill 1,023,024 901,428 Intangible assets, net 1,145,439 923,905 Other non-current assets 186,099 195,266 Total assets $ 3,865,029 $ 3,816,981 Liabilities and stockholders' equity Current liabilities: Accounts payable $ 82,371 $ 93,412 Accrued expenses 175,702 157,456 Due to related parties (refer to Note P) 17,202 16,025 Current portion, long-term debt 10,000 10,000 Other current liabilities 37,681 35,465 Total current liabilities 322,956 312,358 Deferred income taxes 139,861 120,131 Long-term debt 1,705,982 1,661,879 Other non-current liabilities 202,019 203,232 Total liabilities 2,370,818 2,297,600 Commitments and contingencies (refer to Note O) Stockholders' equity Trust preferred shares, 50,000 authorized; 12,634 shares issued and outstanding at March 31, 2024 and 12,600 shares issued and outstanding at December 31, 2023 Series A preferred shares, no par value; 4,008 shares issued and outstanding at March 31, 2024 and 4,000 shares issued and outstanding at December 31, 2023 96,600 96,417 Series B preferred shares, no par value; 4,004 shares issued and outstanding at March 31, 2024 and and 4,000 shares issued and outstanding at December 31, 2023 96,593 96,504 Series C preferred shares, no par value; 4,623 shares issued and outstanding at March 31, 2024 and 4,600 shares issued and outstanding at December 31, 2023 111,552 110,997 Trust common shares, no par value, 500,000 authorized; 75,807 shares issued and 75,324 shares outstanding at March 31, 2024 and 75,753 issued and 75,270 ou

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View this 10-Q filing on SEC EDGAR