The Eastern Company reported its financial results for the third quarter and the first nine months of fiscal 2024, highlighting significant changes in revenue, profitability, and strategic developments. For the three months ended September 28, 2024, net sales increased by 15% to $71.3 million, compared to $62.0 million in the same period of 2023. For the nine months, net sales rose 6% to $206.1 million from $195.1 million year-over-year. This growth was primarily driven by increased demand for returnable transport packaging products, truck mirror assemblies, and truck accessories.
Gross margin for the third quarter was $18.2 million, representing a margin of 25.5%, up from 24.9% in Q3 2023. For the nine months, gross margin increased to $51.9 million, with a margin of 25.2%, compared to 22.9% in the prior year. The improvement in gross margin was attributed to price increases and new product introductions, which helped offset rising raw material costs.
Operating profit for Q3 2024 was $6.8 million, compared to $5.6 million in Q3 2023, while for the nine months, it rose to $17.2 million from $11.4 million. Net income from continuing operations for Q3 2024 was $4.7 million ($0.75 per diluted share), up from $3.5 million ($0.55 per diluted share) in Q3 2023. For the nine months, net income increased to $11.7 million ($1.87 per diluted share) from $7.8 million ($1.24 per diluted share).
The company also faced challenges, including higher raw material costs and supply chain disruptions. Notably, the Big 3 Mold business was classified as discontinued operations due to its misalignment with the company's long-term strategy, resulting in a loss of $19.2 million, net of tax, recognized in Q3 2024.
Total assets as of September 28, 2024, were $244.2 million, down from $252.0 million at the end of the previous fiscal year. Total liabilities increased to $125.0 million from $119.6 million. The company reported cash and cash equivalents of $7.7 million, a slight decrease from $8.0 million at the end of the previous fiscal year.
In terms of strategic developments, the company entered a Credit Agreement in June 2023, which includes a $60 million term loan and a $30 million revolving commitment. As of September 28, 2024, the company was in compliance with all covenants of the Credit Agreement. Additionally, a share repurchase program was announced in August 2023, authorizing the repurchase of up to 200,000 shares of common stock through August 2028.
About EASTERN CO
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