Shares of The Aaron’s Company (NYSE:AAN) are in a freefall in after-hours trade as the company’s swung to a loss in the fourth quarter and projected a loss for 2024 that is significantly worse than Street expectations.
The company reported a loss of $0.26 per share on a 10.2% drop in revenue to $529.5M. This compares to a profit of $0.09 in the same quarter last year and was below expectations for a profit of $0.03 per share. Total revenue was expected at $542.1M.
Cash provided by operating activities declined 32.8% to $31.3M, while adjusted free cash flow was down 35.6% to $15.9M. At the end of the year, the company had cash and cash equivalents of $59M and $331M of availability left in its $375M revolving credit facility.
Adjusted EBITDA fell to $33.8M from $36.2M, attributed to lower lease revenues and fees at the Aaron’s Business and lower retail sales at BrandsMart.
Gross profit margin expanded to 62.8% from 61.5%.
For 2024, Aaron’s expects revenue to be between $2.055B to $2.155B compared to $2.14B in 2023 and below the consensus estimate of $2.20B.
The company also set a range for adjusted EPS to be between a loss of $0.10 per share to a profit of $0.25 per share. This compares to a profit of $0.81 per share in 2023 and the consensus estimate for a profit of $1.09 per share.
Aaron’s will host its earnings call on Tuesday at 8:30am ET.
Shares were down as much as 28% during Monday’s after-hours trading.
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