Karat Packaging, Inc. (NASDAQ:KRT) Q3 2024 Earnings Conference Call November 7, 2024 5:00 PM ET

Company Participants

Roger Pondel - IR, PondelWilkinson Inc.
Alan Yu - CEO
Jian Guo - CFO

Conference Call Participants

Ryan Meyers - Lake Street Capital Markets
Jake Bartlett - Truist Securities
Brian Butler - Stifel

Operator

Hello, and thank you for standing by. At this time, I'd like to welcome everyone to the Karat Packaging, Inc. Third Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded.

I will now turn the conference over to Roger Pondel. Please go ahead, sir.

Roger Pondel

Thank you, operator. Good afternoon, everyone, and welcome to Karat Packaging's 2024 Third Quarter Conference Call. I'm Roger Pondel with PondelWilkinson, Karat Packaging's Investor Relations firm. It will be my pleasure momentarily to introduce the company's Chief Executive Officer, Alan Yu; and its Chief Financial Officer, Jian Guo.

Before I turn the call over to Alan, I want to remind our listeners that today's call may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to numerous conditions, many of which are beyond the company's control, including those set forth in the Risk Factors section of the company's most recent Form 10-K as filed with the Securities and Exchange Commission, and copies of which are available on the SEC's website at www.sec.gov, along with other company filings made with the SEC from time to time. Actual results could differ materially from these forward-looking statements, and Karat Packaging undertakes no obligation to update any forward-looking statements, except as required by law.

Please also note that during today's call, we will be discussing adjusted EBITDA, adjusted EBITDA margin and adjusted diluted earnings per share, which are non-GAAP financial measures as defined by SEC Regulation G. A reconciliation of the most directly comparable GAAP measures to the non-GAAP financial measures is included in today's press release, which is now posted on the company's website.

And with that, it is my pleasure to turn the call over to CEO, Alan Yu. Alan?

Alan Yu

Thank you, Roger. Good afternoon, everyone. We are encouraged by our third quarter performance with net sales up nearly 7% and volume up approximately 10%. Despite some pricing pressure, we experienced growth in most of our sales channels. Our online business, which benefited from the inclusion of $3 million online platform fees in the current quarter, achieved a 33% increase over the prior year period. Karat's recent expansion into the supermarket chain category is starting to generate positive results.