FY 2024 Net Income up 51% to $18.6 Million or $4.06 per share; Adjusted Net Income up 64% to $24.0 Million or $5.26 per share; Adjusted EBITDA up 61% to $39.6 Million

Q4 & FY 2024 Net Sales, Gross Profit, Net Income, EPS and Adjusted EBITDA Increase to Record Levels

EATONTOWN, N.J., March 05, 2025 (GLOBE NEWSWIRE) -- Climb Global Solutions, Inc. (NASDAQ:CLMB) ("Climb" or the "Company"), a value-added global IT channel company providing unique sales and distribution solutions for innovative technology vendors, is reporting results for the fourth quarter and full year ended December 31, 2024.

Fourth Quarter 2024 Summary vs. Same Year-Ago Quarter

Net sales increased 51% to $161.8 million.
Net income increased 33% to $7.0 million or $1.52 per diluted share.
Adjusted net income (a non-GAAP financial measure defined below) increased 87% to $10.3 million or $2.26 per diluted share.
Adjusted EBITDA (a non-GAAP financial measure defined below) increased 75% to $16.1 million.
Gross billings (a key operational metric defined below) increased 52% to $605.0 million. Distribution segment gross billings increased 57% to $582.0 million, and Solutions segment gross billings decreased 9% to $23.0 million.

FY 2024 Summary vs. FY 2023

Net sales increased 32% to $465.6 million.
Net income increased 51% to $18.6 million or $4.06 per diluted share.
Adjusted net income (a non-GAAP financial measure defined below) increased 64% to $24.0 million or $5.26 per diluted share.
Adjusted EBITDA (a non-GAAP financial measure defined below) increased 61% to $39.6 million.
Gross billings (a key operational metric defined below) increased 42% to $1.8 billion. Distribution segment gross billings increased 44% to $1.7 billion, and Solutions segment gross billings increased 7% to $89.8 million.

Management Commentary

"Our fourth quarter performance capped off an exceptional 2024, marking another year of record results across all key financial metrics," said CEO Dale Foster. "Throughout the year, we evaluated over 120 vendors and signed agreements with only 13 of them, demonstrating our commitment to partnering with the most innovative technologies in the market. We also added scale and expertise to our North America operations through the acquisition of Douglas Stewart Software & Services, LLC ("DSS"), which was immediately accretive to earnings. I'm proud of our team's hard work in generating double-digit organic growth in both the U.S. and Europe, reinforcing our commitment to deepening relationships with our partners across our global footprint.

"Looking ahead, we have a solid foundation in place to continue driving strong organic growth while further improving operating leverage through the implementation of our ERP system. We will also continue to evaluate M&A opportunities that can enhance our service and solutions offerings, as well as expand our geographic footprint in the U.S. and overseas. These initiatives, coupled with our demonstrated track record of execution and a robust balance sheet, will enable us to deliver on our organic and inorganic growth initiatives in 2025."

Dividend

Subsequent to quarter end, on February 28, 2025, Climb's Board of Directors declared a quarterly dividend of $0.17 per share of its common stock payable on March 21, 2025, to shareholders of record on March 17, 2025.

Fourth Quarter 2024 Financial Results

Net sales in the fourth quarter of 2024 increased 51% to $161.8 million compared to $106.8 million for the same period in 2023. This reflects organic growth from new and existing vendors, as well as contribution from the Company's acquisition of DSS on July 31, 2024. In addition, gross billings in the fourth quarter of 2024 increased 52% to $605.0 million compared to $397.0 million in the year-ago period.

Gross profit in the fourth quarter of 2024 increased 48% to $31.2 million compared to $21.1 million for the same period in 2023. The increase was driven by organic growth from new and existing vendors in both North America and Europe, as well as contribution from DSS.

Selling, general, and administrative ("SG&A") expenses in the fourth quarter of 2024 were $17.1 million compared to $12.4 million in the year-ago period. DSS represented $2.2 million of the increase. SG&A as a percentage of gross billings decreased to 2.8% for the fourth quarter of 2024 compared to 3.1% in the year-ago period.

Net income in the fourth quarter of 2024 increased 33% to $7.0 million or $1.52 per diluted share, compared to $5.2 million or $1.15 per diluted share for the same period in 2023. Net income was impacted by a $2.5 million charge related to a change in fair value of acquisition contingent consideration associated with Spinnakar Limited. Adjusted net income increased 87% to $10.3 million or $2.26 per diluted share, compared to $5.5 million or $1.21 per diluted share for the year-ago period.

Adjusted EBITDA in the fourth quarter of 2024 increased 75% to $16.1 million compared to $9.2 million for the same period in 2023. The increase was primarily driven by organic growth from both new and existing vendors, as well as contribution from the Company's acquisition of DSS. Effective margin, which is defined as adjusted EBITDA as a percentage of gross profit, increased 780 basis points to 51.5% compared to 43.7% for the same period in 2023.

On December 31, 2024, cash and cash equivalents were $29.8 million compared to $36.3 million on December 31, 2023, while working capital decreased by $9.3 million during this period. The decrease in cash was primarily attributed to $20.4 million of cash paid at closing for the acquisition of DSS, as well as the timing of receivable collections and payables. Climb had $0.8 million of outstanding debt on December 31, 2024, with no borrowings outstanding under its $50 million revolving credit facility.

For more information on the non-GAAP financial measures discussed in this press release, please see the section titled, "Non-GAAP Financial Measures," and the reconciliations of non-GAAP financial measures to their nearest comparable GAAP financial measures at the end of this press release.

Conference Call

The Company will conduct a conference call tomorrow, March 6, 2025, at 8:30 a.m. Eastern time to discuss its results for the fourth quarter and full year ended December 31, 2024.

Climb management will host the conference call, followed by a question-and-answer period.

Date: Thursday, March 6, 2025

Time: 8:30 a.m. Eastern time

Toll-free dial-in number: (800) 225-9448

International dial-in number: (203) 518-9708

Conference ID: CLIMB

Webcast: Climb's Q4 & FY 2024 Conference Call

If you have any difficulty registering or connecting with the conference call, please contact Elevate IR at (720) 330-2829.

The conference call will also be available for replay on the investor relations section of the Company's website at www.climbglobalsolutions.com.

About Climb Global Solutions

Climb Global Solutions, Inc. (NASDAQ:CLMB) is a value-added global IT distribution and solutions company specializing in emerging and innovative technologies. Climb operates across the US, Canada and Europe through multiple business units, including Climb Channel Solutions, Grey Matter and Climb Global Services. The Company provides IT distribution and solutions for companies in the Security, Data Management, Connectivity, Storage & HCI, Virtualization & Cloud, and Software & ALM industries.

Additional information can be found by visiting www.climbglobalsolutions.com.

Non-GAAP Financial Measures

Climb Global Solutions uses non-GAAP financial measures, including adjusted net income and adjusted EBITDA, as supplemental measures of the performance of the Company's business. Use of these financial measures has limitations, and you should not consider them in isolation or use them as substitutes for analysis of Climb's financial results under generally accepted accounting principles in the United States of America ("U.S. GAAP"). The attached tables provide definitions of these measures and a reconciliation of each non-GAAP financial measure to the most nearly comparable measure under U.S. GAAP.

Key Operational Metric

Gross Billings

Gross billings are the total dollar value of customer purchases of goods and services during the period, net of customer returns and credit memos, sales, or other taxes. Gross billings include the transaction values for certain sales transactions that are recognized on a net basis, and, therefore, includes amounts that will not be recognized as revenue. We use gross billings as an operational metric to assess the volume of transactions or market share for our business as well as to understand changes in our accounts receivable and accounts payable. We believe gross billings will aid investors in the same manner.

Forward-Looking Statements

The statements in this release, other than statements of historical fact, are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and are intended to come within the safe harbor protection provided by those sections. These forward-looking statements are subject to certain risks and uncertainties. Many of the forward-looking statements may be identified by words such as "look forward," "believes," "expects," "intends," "anticipates," "plans," "estimates," "projects," "forecasts," "should," "could," "would," "will," "confident," "may," "can," "potential," "possible," "proposed," "in process," "under construction," "in development," "opportunity," "target," "outlook," "maintain," "continue," "goal," "aim," "commit," or similar expressions, or when we discuss our priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations. In this press release, the forward-looking statements relate to, among other things, declaring and reaffirming our strategic goals, future operating results, and the effects and potential benefits of the strategic acquisition on our business. Factors, among others, that could cause actual results and events to differ materially from those described in any forward-looking statements include, without limitation, our ability to recognize the anticipated benefits of the acquisitions of Data Solutions Holdings Limited and Douglas Stewart Software & Services, LLC, the continued acceptance of the Company's distribution channel by vendors and customers, the timely availability and acceptance of new products, product mix, market conditions, competitive pricing pressures, the successful integration of acquisitions, contribution of key vendor relationships and support programs, inflation, interest rate risk and impact thereof, as well as factors that affect the software industry in general. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described in the section entitled "Risk Factors" contained in Item 1A. of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and from time to time in the Company's filings with the Securities and Exchange Commission.

Company Contact

Matthew Sullivan

Chief Financial Officer

(732) 847-2451

MatthewS@ClimbCS.com

Investor Relations Contact

Sean Mansouri, CFA or Aaron D'Souza

Elevate IR

(720) 330-2829

CLMB@elevate-ir.com


CLIMB GLOBAL SOLUTIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
	(Unaudited)
(Amounts in thousands, except share and per share amounts)

		December 31, 2024			December 31, 2023

ASSETS

Current assets
	Cash and cash equivalents	$	29,778		$	36,295
	Accounts receivable, net of allowance for doubtful accounts of $588 and $709, respectively		341,597			222,269
	Inventory, net		2,447			3,741
	Prepaid expenses and other current assets		6,874			6,755
Total current assets			380,696			269,060

Equipment and leasehold improvements, net			12,853			8,850
Goodwill			34,924			27,182
Other intangibles, net			36,550			26,930
Right-of-use assets, net			1,965			878
Accounts receivable long-term, net			1,174			797
Other assets			824			1,077
Deferred income tax assets			193			324

Total assets		$	469,179		$	335,098

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
	Accounts payable and accrued expenses	$	370,397		$	249,648
	Lease liability, current portion		654			450
	Term loan, current portion		560			540
Total current liabilities			371,611			250,638

	Lease liability, net of current portion		1,685			879
	Deferred income tax liabilities		4,723			5,554
	Term loan, net of current portion		191			752
	Non-current liabilities		381			2,505

Total liabilities			378,591			260,328


Stockholders' equity
	Common stock, $.01 par value; 10,000,000 shares authorized, 5,284,500 shares
	issued, and 4,601,302 and 4,573,448 shares outstanding , respectively		53			53
	Additional paid-in capital		37,977			34,647
	Treasury stock, at cost, 683,198 and 711,052 shares, respectively		(13,337	)		(12,623	)
	Retained earnings		68,787			53,215
	Accumulated other comprehensive loss		(2,892	)		(522	)
Total stockholders' equity			90,588			74,770
Total liabilities and stockholders' equity		$	469,179		$	335,098

CLIMB GLOBAL SOLUTIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(Amounts in thousands, except per share data)

		Year ended						Three months ended
		December 31,						December 31,
			2024			2023			2024			2023

Net Sales		$	465,607		$	352,013		$	161,760		$	106,783

Cost of sales			374,527			287,766			130,513			85,713

Gross profit			91,080			64,247			31,247			21,070

Selling, general and administrative expenses			56,508			44,330			17,075			12,400
Depreciation & amortization expense			4,269			2,798			1,336			864
Acquisition related costs			2,311			629			1,110			352
Total selling, general and administrative expenses			63,088			47,757			19,521			13,616

Income from operations			27,992			16,490			11,726			7,454

Interest, net			917			927			162			168
Foreign currency transaction (loss) gain			(273	)		(636	)		415			(536	)
Change in fair value of acquisition contingent consideration			(3,618	)		-			(2,466	)		-
Income before provision for income taxes			25,018			16,781			9,837			7,086
Provision for income taxes			6,408			4,458			2,847			1,840

Net income		$	18,610		$	12,323		$	6,990		$	5,246

Income per common share - Basic		$	4.06		$	2.72		$	1.52		$	1.15
Income per common share - Diluted		$	4.06		$	2.72		$	1.52		$	1.15

Weighted average common shares outstanding - Basic			4,465			4,401			4,485			4,427
Weighted average common shares outstanding - Diluted			4,465			4,401			4,485			4,427

Dividends paid per common share		$	0.68		$	0.68		$	0.17		$	0.17


Reconciliation of GAAP and Non-GAAP Financial Measures (unaudited)
(Amounts in thousands, except per share data)

The table below presents net income reconciled to adjusted EBITDA (Non-GAAP) (1):

		Year ended						Three months ended
		December 31,			December 31,			December 31,			December 31,
			2024			2023			2024			2023

Net income		$	18,610		$	12,323		$	6,990		$	5,246
	Provision for income taxes		6,408			4,458			2,847			1,840
	Depreciation and amortization		4,269			2,798			1,336			864
	Interest expense		335			264			69			170
EBITDA			29,622			19,843			11,242			8,120
	Share-based compensation		4,070			4,148			1,260			726
	Acquisition related costs		2,311			629			1,110			352
	Change in fair value of acquisition contingent consideration		3,618			-			2,466			-
Adjusted EBITDA		$	39,621		$	24,620		$	16,078		$	9,198


		Year ended						Three months ended
		December 31,			December 31,			December 31,			December 31,
Components of interest, net			2024			2023			2024			2023

	Amortization of discount on accounts receivable with extended payment terms	$	(34	)	$	(50	)	$	(11	)	$	(9	)
	Interest income		(1,218	)		(1,141	)		(220	)		(329	)
	Interest expense		335			264			69			170
Interest, net		$	(917	)	$	(927	)	$	(162	)	$	(168	)

(1) We define adjusted EBITDA, as net income, plus provision for income taxes, depreciation, amortization, share-based compensation, interest, acquisition related costs and change in fair value of acquisition contingent consideration. We define effective margin as adjusted EBITDA as a percentage of gross profit. We provided a reconciliation of adjusted EBITDA to net income, which is the most directly comparable US GAAP measure. We use adjusted EBITDA as a supplemental measure of our performance to gain insight into our businesses profitability, operating performance and performance trends, and to provide management and investors a useful measure for period-to-period comparisons by excluding items that management believes are not reflective of our underlying operating performance. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results. Adjusted EBITDA is also a component to our financial covenants in our credit facility. Our use of adjusted EBITDA has limitations, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under US GAAP. In addition, other companies, including companies in our industry, might calculate adjusted EBITDA, or similarly titled measures differently, which may reduce their usefulness as comparative measures.

The table below presents net income reconciled to adjusted net income (Non-GAAP) (2):

		Year ended				Three months ended
		December 31,		December 31,		December 31,		December 31,
			2024		2023		2024		2023

	Net income	$	18,610	$	12,323	$	6,990	$	5,246
	Acquisition related costs, net of income taxes		1,733		472		833		264
	One-time CEO stock grant		-		1,796		-		-
	Change in fair value of acquisition contingent consideration		3,618		-		2,466		-
	Adjusted net income	$	23,961	$	14,591	$	10,289	$	5,510

	Adjusted net income per common share - diluted	$	5.26	$	3.24	$	2.26	$	1.21

(2) We define adjusted net income as net income excluding acquisition related costs, net of income taxes, the stock compensation expense recognized for the one-time CEO stock grant, and the change in fair value of acquisition contingent consideration. We provided a reconciliation of adjusted net income to net income, which is the most directly comparable U.S. GAAP measure. We use adjusted net income and adjusted net income per common share as supplemental measures of our performance to gain insight into our businesses profitability, operating performance and performance trends, and to provide management and investors a useful measure for period-to-period comparisons by excluding items that management believes are not reflective of our underlying operating performance. Accordingly, we believe that adjusted net income and adjust net income per common share provide useful information to investors and others in understanding and evaluating our operating results. Our use of adjusted net income has limitations, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under U.S. GAAP. In addition, other companies, including companies in our industry, might calculate adjusted net income, or similarly titled measures differently, which may reduce their usefulness as comparative measures.

The table below presents the operational metric of gross billings by segment (3):

		Year ended				Three months ended
		December 31,		December 31,		December 31,		December 31,
			2024		2023		2024		2023

	Distribution gross billings	$	1,695,538	$	1,176,866	$	581,963	$	371,673
	Solutions gross billings		89,764		83,516		23,045		25,370
	Total gross billings	$	1,785,302	$	1,260,382	$	605,008	$	397,043

(3) Gross billings are the total dollar value of customer purchases of goods and services during the period, net of customer returns and credit memos, sales, or other taxes. Gross billings include the transaction values for certain sales transactions that are recognized on a net basis, and, therefore, include amounts that will not be recognized as revenue. We use gross billings as an operational metric to assess the volume of transactions or market share for our business as well as to understand changes in our accounts receivable and accounts payable. We believe gross billings will aid investors in the same manner.

Climb Global Solutions Reports Record Fourth Quarter and Full Year 2024 Results