Compass Diversified Holdings Q3 2024 10-Q Filed

TL;DR

**CODI Q3 2024 10-Q: Assets $8.3B, Liabilities $15.7B, Net Sales $1.7B, Net Loss $4.2B**

AI Summary

Compass Diversified Holdings filed its 10-Q for the period ending September 30, 2024. The company reported total assets of $8,323 million and total liabilities of $15,733 million. Net sales for the period were $1,725 million, with a net loss of $4,159 million.

Why It Matters

This filing provides a quarterly update on Compass Diversified Holdings' financial performance, including its assets, liabilities, and sales, which are crucial for investors to assess the company's health.

Risk Assessment

Risk Level: medium — The company reported a significant net loss and a large amount of liabilities relative to assets, indicating potential financial strain.

Key Numbers

• $8.3B — Total Assets (As of September 30, 2024)
• $15.7B — Total Liabilities (As of September 30, 2024)
• $1.7B — Net Sales (For the period ending September 30, 2024)
• $4.2B — Net Loss (For the period ending September 30, 2024)

Key Players & Entities

• Compass Diversified Holdings (company) — Filer of the 10-Q
• 20240930 (date) — End of the reporting period
• $8,323 million (dollar_amount) — Total assets
• $15,733 million (dollar_amount) — Total liabilities
• $1,725 million (dollar_amount) — Net sales
• $4,159 million (dollar_amount) — Net loss

FAQ

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-20240930.htm (10-Q) — 2965KB
• a09302024-ex311.htm (EX-31.1) — 9KB
• a09302024-ex312.htm (EX-31.2) — 10KB
• a09302024-ex321.htm (EX-32.1) — 6KB
• a09302024-ex322.htm (EX-32.2) — 6KB
• 0001345126-24-000063.txt ( ) — 13349KB
• codi-20240930.xsd (EX-101.SCH) — 66KB
• codi-20240930_cal.xml (EX-101.CAL) — 95KB
• codi-20240930_def.xml (EX-101.DEF) — 722KB
• codi-20240930_lab.xml (EX-101.LAB) — 746KB
• codi-20240930_pre.xml (EX-101.PRE) — 816KB
• codi-20240930_htm.xml (XML) — 2101KB

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 11 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 13

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 43

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 78

CONTROLS AND PROCEDURES

ITEM 4. CONTROLS AND PROCEDURES 78

OTHER INFORMATION 80

PART II. OTHER INFORMATION 80

LEGAL PROCEEDINGS

ITEM 1. LEGAL PROCEEDINGS 80

RISK FACTORS

ITEM 1A. RISK FACTORS 80

EXHIBITS

ITEM 6. EXHIBITS 81

SIGNATURES

SIGNATURES 84 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, as further amended; 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 September 30, 2024 December 31, 2023 (in thousands) (Unaudited) Assets Current assets: Cash and cash equivalents $ 71,948 $ 450,477 Accounts receivable, net 412,688 318,241 Inventories, net 939,361 740,387 Prepaid expenses and other current assets 100,550 94,715 Total current assets 1,524,547 1,603,820 Property, plant and equipment, net 186,555 192,562 Goodwill 1,004,084 901,428 Intangible assets, net 1,062,425 923,905 Other non-current assets 183,803 195,266 Total assets $ 3,961,414 $ 3,816,981 Liabilities and stockholders' equity Current liabilities: Accounts payable $ 95,782 $ 93,412 Accrued expenses 197,485 157,456 Due to related parties (refer to Note P) 18,116 16,025 Current portion, long-term debt 12,500 10,000 Other current liabilities 37,337 35,465 Total current liabilities 361,220 312,358 Deferred income taxes 135,777 120,131 Long-term debt 1,763,687 1,661,879 Other non-current liabilities 198,849 203,232 Total liabilities 2,459,533 2,297,600 Commitments and contingencies (refer to Note O) Stockholders' equity Trust preferred shares, 50,000 authorized; 13,725 shares issued and outstanding at September 30, 2024 and 12,600 shares issued and outstanding at December 31, 2023 Series A preferred shares, no par value; 4,159 shares issued and outstanding at September 30, 2024 and 4,000 shares issued and outstanding at December 31, 2023 100,174 96,417 Series B preferred shares, no par value; 4,437 shares issued and outstanding at September 30, 2024 and and 4,000 shares issued and outstanding at December 31, 2023 107,003 96,504 Series C preferred shares, no par value; 5,129 shares issued and outstanding at September 30, 2024 and 4,600 shares issued and outstanding at December 31, 2023 123,685 110,997 Trust common shares, no par value, 500,000 authorized; 76,135 shares issued and 75,652 shares outstanding at September 30, 2024 and 7

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View this 10-Q filing on SEC EDGAR