Karat Packaging Inc. (NASDAQ:KRT) Q4 2023 Earnings Call Transcript

Operator: The next question is a follow-up from Michael Hoffmann with Stifel.

Michael Hoffman: The M&A, just to be clear, given the quality of the cash flow, I presume you would be able to fund the small M&A that you’re thinking about all from sources that you generate. So it’s self funded?

Alan Yu: Correct. Unless — I mean we’re — basically, we have over $100 million — like Jian mentioned in our report, over $110 million in cash flow in terms that we can utilize, which we’re not going to utilize all of it. But for sure, that’s something that we have — we can do self fund it.

Michael Hoffman: A big statement being is that there’s nothing on the rate of it, you’re going to drive the leverage up. This is going to be self funded off of cash and the leverage stays relatively stable.

Alan Yu: Yes. And also, we are going to generate even more cash this year.

Michael Hoffman: That’s what I was trying to get at.

Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Alan Yu for any closing remarks.

Alan Yu: Thank you, everyone, for joining our 2023 fourth quarter earnings call. And I would like to say thank you all, and have a nice day. Thank you very much. Bye-bye.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.