CPI Card sees FY24 net sales outlook up mid single digits

The company updated its financial outlook for 2024, increasing its outlook for net sales from slight growth to a mid-single digit increase, while retaining its Adjusted EBITDA outlook of a slight increase from prior year. The company maintained its Adjusted EBITDA outlook of a slight increase for the full year as profit growth in the second half is expected to be lower than sales growth due to certain anticipated impacts to SG&A, including investments to grow the business and increased performance-related compensation relative to 2023. The Free Cash Flow outlook was maintained at approximately half of the 2023 level. The company generated $27.6 million of Free Cash Flow in 2023 and expects lower levels in 2024 due to increased capital spending investment, including investment in a new state-of-the-art secure card production facility in Indiana, and the impact of a contract with one of the company’s larger customers, which should benefit cash flow through 2029, but negatively impact Free Cash Flow in 2024 due to up-front incentives. The company continues to expect its year-end 2024 Net Leverage Ratio to be between 3.0x and 3.5x.