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Karat Packaging Inc (KRT+0.10%). has submitted its 10-Q filing for the quarterly period ended September 30, 2024.
The filing includes financial statements for the quarter, showing an increase in net sales to $112.8 million from $105.5 million in the same quarter the previous year. The increase is attributed to higher volume and changes in product mix.
Cost of goods sold for the quarter was $69.3 million, representing 61.4% of sales, compared to 63.1% in the same quarter of the previous year. This decrease in cost ratio is due to more favorable vendor pricing and increased import as a percentage of total product mix.
The company reported a gross profit of $43.5 million for the quarter, compared to $38.9 million in the previous year, with the increase attributed to lower product costs.
Operating expenses increased to $32.2 million from $27.6 million, primarily due to online sales platform fees and increased rent and warehouse expenses.
Net income for the quarter was $9.3 million, up from $9.1 million in the previous year. The increase was primarily driven by a reduction in the provision for income taxes.
Cash provided by operating activities was $39.7 million, while cash used in investing and financing activities was $1.8 million and $25.7 million, respectively.
Karat Packaging had a working capital of $115.6 million as of September 30, 2024. The company continues to explore options to expand its liquidity to support business growth.
The filing also details various financial agreements, including a line of credit with Hanmi Bank (HAFC-0.54%) and term loans with financial institutions.
Karat Packaging does not anticipate cash dividend payments to common stockholders in the near future.
The company identified a material weakness in its internal controls over financial reporting and is engaged in remedial actions to address the deficiencies.
Karat Packaging continues to focus on expanding its product offerings and enhancing its distribution capabilities to meet growing customer demand.
This content was summarized by generative artificial intelligence using public filings retrieved from SEC.gov. The original data was derived from the Karat Packaging Inc. quarterly 10-Q report dated November 8, 2024. To report an error, please email earnings@qz.com.