Cadre Holdings, Inc. (NYSE:CDRE) Q4 2022 Earnings Call Transcript

Warren Kanders: Yeah, I don’t — wouldn’t see this replacing that whole headwind, but, something that could help offset it would be stronger Ukraine demand than we currently have weight in our guidance that that could certainly lift lifted up. If we get to a point where there’s a much larger focus on creating safe areas or creating safe areas for civilians to enter, that would certainly drive it. We can’t predict kind of where the military goes, but other than that it would probably take a pretty unexpected change in the refresh cycle for it to be significant there.

Matt Koranda: Okay, that’s fair. And then just any help maybe Blaine on revenue cadence or seasonality this year, just given that we have a couple acquisitions that we’re not part of the organization last year, not meaningful to it yet for Q1, just anything you can help us in terms of calling out season another for the year does it change anything? Should we be thinking about know that I think you guys qualitatively said radar is kind of more back half weighted type revenue stream, but just help us kind of think about the cadence if you could.

Blaine Browers: Yeah, asylum right, are very different businesses when it comes to that timing. Asylum has generally been a much more evenly spread business quarter-to-quarter. And when we say no seasonality, there’s not tend to not be any major differences between the quarters whereas radar’s back half. When we think about the cadence for 2023, it looks very similar to 2022. So head certainly heavier back half than first half and that’ll change right as we kind of go through the year. That’s, one thing that tends to move a little bit, sometimes you’ll see those projects that are project out in Q4 coming in early. So it’s something we always watch, but it looks very similar to what we saw in 2020 or we expect it to be very similar to what we saw in 2022.

Matt Koranda: Okay, great. And then just if I could sneak one more in, on just when I think about the midpoint of the guide, it looks like it’s pretty much flattish on EBITDA margin. We’ll just ask the question and it was asked kind of more of likely before, but just any color around what eats into that 1% kind of price above material inflation that you guys usually have. Just curious if it’s a mix thing or if it’s more kind of material and labor headwinds that you’re assuming. Just any help put a fire point on that, that’d be helpful.

Warren Kanders: Yeah, it’s much more about the mix component on the margin. So, all the businesses in the guide, we have that 1% achieved in there, that 1% above material inflation. So, and we don’t feel like there’s a serious risk there or anything that changes our view on that coming into the year, but the EOD products are one of our more profitable margin lines and so as we lose that volume there and what we saw then elsewhere, in particular in armor it’s just unfavorable mix for us.

Matt Koranda: Okay. Super helpful. Thanks guys.

Operator: We’ll go next now to Mark Smith of Lake Street Capital Markets.

Mark Smith: Hi guys. You spoke a little bit about this and I know this question’s probably early, but as we look at some of the new products that were launched, any indication that maybe this pulls forward some demand kind of above kind of the typical replacement cycle?

Warren Kanders: We’ll see Mark, it’s too early, especially on the holster side of things. We’re not getting rid of our 7Ts line of seven series of, of holsters they’re there as a product that’s currently positioned in the marketplace. And then we’ll have the new product, the new line of Safari Vault and we’ll see what happens but, we’ll see if that dries premature replacement cycles.