Climb Global Solutions Reports Record Fourth Quarter and Full Year 2024 Results

FY 2024 Net Income up 51% to $18.6 Million or $4.06 per share; Adjusted Net Income up 64% to $24.0 Million or $5.26 per share; Adjusted EBITDA up 61% to $39.6 Million

Q4 & FY 2024 Net Sales, Gross Profit, Net Income, EPS and Adjusted EBITDA Increase to Record Levels

EATONTOWN, N.J., March 05, 2025 (GLOBE NEWSWIRE) -- Climb Global Solutions, Inc. (NASDAQ:CLMB) ("Climb" or the "Company"), a value-added global IT channel company providing unique sales and distribution solutions for innovative technology vendors, is reporting results for the fourth quarter and full year ended December 31, 2024.

Fourth Quarter 2024 Summary vs. Same Year-Ago Quarter

   -- Net sales increased 51% to $161.8 million. 
 
   -- Net income increased 33% to $7.0 million or $1.52 per diluted share. 
 
   -- Adjusted net income (a non-GAAP financial measure defined below) 
      increased 87% to $10.3 million or $2.26 per diluted share. 
 
   -- Adjusted EBITDA (a non-GAAP financial measure defined below) increased 
      75% to $16.1 million. 
 
   -- Gross billings (a key operational metric defined below) increased 52% to 
      $605.0 million. Distribution segment gross billings increased 57% to 
      $582.0 million, and Solutions segment gross billings decreased 9% to 
      $23.0 million. 

FY 2024 Summary vs. FY 2023

   -- Net sales increased 32% to $465.6 million. 
 
   -- Net income increased 51% to $18.6 million or $4.06 per diluted share. 
 
   -- Adjusted net income (a non-GAAP financial measure defined below) 
      increased 64% to $24.0 million or $5.26 per diluted share. 
 
   -- Adjusted EBITDA (a non-GAAP financial measure defined below) increased 
      61% to $39.6 million. 
 
   -- Gross billings (a key operational metric defined below) increased 42% to 
      $1.8 billion. Distribution segment gross billings increased 44% to $1.7 
      billion, and Solutions segment gross billings increased 7% to $89.8 
      million. 

Management Commentary

"Our fourth quarter performance capped off an exceptional 2024, marking another year of record results across all key financial metrics," said CEO Dale Foster. "Throughout the year, we evaluated over 120 vendors and signed agreements with only 13 of them, demonstrating our commitment to partnering with the most innovative technologies in the market. We also added scale and expertise to our North America operations through the acquisition of Douglas Stewart Software & Services, LLC ("DSS"), which was immediately accretive to earnings. I'm proud of our team's hard work in generating double-digit organic growth in both the U.S. and Europe, reinforcing our commitment to deepening relationships with our partners across our global footprint.

"Looking ahead, we have a solid foundation in place to continue driving strong organic growth while further improving operating leverage through the implementation of our ERP system. We will also continue to evaluate M&A opportunities that can enhance our service and solutions offerings, as well as expand our geographic footprint in the U.S. and overseas. These initiatives, coupled with our demonstrated track record of execution and a robust balance sheet, will enable us to deliver on our organic and inorganic growth initiatives in 2025."

Dividend

Subsequent to quarter end, on February 28, 2025, Climb's Board of Directors declared a quarterly dividend of $0.17 per share of its common stock payable on March 21, 2025, to shareholders of record on March 17, 2025.

Fourth Quarter 2024 Financial Results

Net sales in the fourth quarter of 2024 increased 51% to $161.8 million compared to $106.8 million for the same period in 2023. This reflects organic growth from new and existing vendors, as well as contribution from the Company's acquisition of DSS on July 31, 2024. In addition, gross billings in the fourth quarter of 2024 increased 52% to $605.0 million compared to $397.0 million in the year-ago period.

Gross profit in the fourth quarter of 2024 increased 48% to $31.2 million compared to $21.1 million for the same period in 2023. The increase was driven by organic growth from new and existing vendors in both North America and Europe, as well as contribution from DSS.

Selling, general, and administrative ("SG&A") expenses in the fourth quarter of 2024 were $17.1 million compared to $12.4 million in the year-ago period. DSS represented $2.2 million of the increase. SG&A as a percentage of gross billings decreased to 2.8% for the fourth quarter of 2024 compared to 3.1% in the year-ago period.

Net income in the fourth quarter of 2024 increased 33% to $7.0 million or $1.52 per diluted share, compared to $5.2 million or $1.15 per diluted share for the same period in 2023. Net income was impacted by a $2.5 million charge related to a change in fair value of acquisition contingent consideration associated with Spinnakar Limited. Adjusted net income increased 87% to $10.3 million or $2.26 per diluted share, compared to $5.5 million or $1.21 per diluted share for the year-ago period.

Adjusted EBITDA in the fourth quarter of 2024 increased 75% to $16.1 million compared to $9.2 million for the same period in 2023. The increase was primarily driven by organic growth from both new and existing vendors, as well as contribution from the Company's acquisition of DSS. Effective margin, which is defined as adjusted EBITDA as a percentage of gross profit, increased 780 basis points to 51.5% compared to 43.7% for the same period in 2023.

On December 31, 2024, cash and cash equivalents were $29.8 million compared to $36.3 million on December 31, 2023, while working capital decreased by $9.3 million during this period. The decrease in cash was primarily attributed to $20.4 million of cash paid at closing for the acquisition of DSS, as well as the timing of receivable collections and payables. Climb had $0.8 million of outstanding debt on December 31, 2024, with no borrowings outstanding under its $50 million revolving credit facility.

For more information on the non-GAAP financial measures discussed in this press release, please see the section titled, "Non-GAAP Financial Measures," and the reconciliations of non-GAAP financial measures to their nearest comparable GAAP financial measures at the end of this press release.

Conference Call

The Company will conduct a conference call tomorrow, March 6, 2025, at 8:30 a.m. Eastern time to discuss its results for the fourth quarter and full year ended December 31, 2024.

Climb management will host the conference call, followed by a question-and-answer period.

Date: Thursday, March 6, 2025

Time: 8:30 a.m. Eastern time

Toll-free dial-in number: (800) 225-9448

International dial-in number: (203) 518-9708

Conference ID: CLIMB

Webcast: Climb's Q4 & FY 2024 Conference Call

If you have any difficulty registering or connecting with the conference call, please contact Elevate IR at (720) 330-2829.

The conference call will also be available for replay on the investor relations section of the Company's website at www.climbglobalsolutions.com.

About Climb Global Solutions

Climb Global Solutions, Inc. (NASDAQ:CLMB) is a value-added global IT distribution and solutions company specializing in emerging and innovative technologies. Climb operates across the US, Canada and Europe through multiple business units, including Climb Channel Solutions, Grey Matter and Climb Global Services. The Company provides IT distribution and solutions for companies in the Security, Data Management, Connectivity, Storage & HCI, Virtualization & Cloud, and Software & ALM industries.

Additional information can be found by visiting www.climbglobalsolutions.com.

Non-GAAP Financial Measures

Climb Global Solutions uses non-GAAP financial measures, including adjusted net income and adjusted EBITDA, as supplemental measures of the performance of the Company's business. Use of these financial measures has limitations, and you should not consider them in isolation or use them as substitutes for analysis of Climb's financial results under generally accepted accounting principles in the United States of America ("U.S. GAAP"). The attached tables provide definitions of these measures and a reconciliation of each non-GAAP financial measure to the most nearly comparable measure under U.S. GAAP.

Key Operational Metric

Gross Billings

Gross billings are the total dollar value of customer purchases of goods and services during the period, net of customer returns and credit memos, sales, or other taxes. Gross billings include the transaction values for certain sales transactions that are recognized on a net basis, and, therefore, includes amounts that will not be recognized as revenue. We use gross billings as an operational metric to assess the volume of transactions or market share for our business as well as to understand changes in our accounts receivable and accounts payable. We believe gross billings will aid investors in the same manner.

Forward-Looking Statements

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