Stran & Company, Quincy, MA, last week provided a business update and reported financial results for the three months ended March 31, 2023.
“We are proud to report a 28.7% increase in revenue to $15.8 million for the first quarter of 2023,” said Andy Shape, president and CEO of Stran. “Most notably, we achieved organic revenue growth of 17.7%, while many other companies in our industry are contracting, reflecting our increasing market share and diversified customer base. At the same time, our gross profit increased 45.9% over the same period last year. Historically, the first quarter has been our slowest quarter in terms of revenue, however, we believe as a result of continually executing on our growth strategy, including M&A and organic growth, we have positioned ourselves for sustainable revenue growth.”
Shape continued that the company incurred higher expenses due to temporary costs associated with integrating recent acquisitions.
“On the M&A front, we are effectively onboarding our previously announced acquisitions of Premier NYC Services, Trend Promotional Marketing Corporation, and G.A.P. Promotions, LLC; and also entered into a definitive agreement to acquire T R Miller Co., Inc., as announced in January,” Shape said. “We expect to complete the TR Miller acquisition during the second quarter, and believe the combination of these acquisitions brings important and unique advantages to Stran.”
Financial Results
Revenue increased 28.7% to approximately $15.8 million for the three months ended March 31, 2023 from approximately $12.3 million for the three months ended March 31, 2022. The increase was primarily due to higher spending from existing clients, as well as business from new customers. Additionally, the company benefitted from the acquisitions of G.A.P. Promotions assets in January 2022, the Trend Brand Solutions assets in August 2022, and the Premier NYC assets in December 2022.
Gross profit increased 45.9% to approximately $4.7 million, or 29.8% of revenue, for the three months ended March 31, 2023, from approximately $3.2 million, or 26.3% of revenue, for the three months ended March 31, 2022. The increases in the dollar amount of gross profit was due to increased sales, partially offset by an increase in purchasing costs.
Net loss for the three months ended March 31, 2023 was approximately $0.7 million, compared to a net loss of approximately 40.5 million for the three months ended March 31, 2022. The increase was primarily due to increased expenses relating to an increase in lead generation initiatives, integration expenses related to the acquisition of the G.A.P. Promotions assets, the Trend brand Solutions assets, and the Premier NYC assets; due diligence relating to the asset purchase agreement for the acquisition of TR Miller’s assets; the implementation of an ERP system on NetSuite ERP’s platform; ongoing expenses related to being a public company; and higher cost of purchases in the three months ended March 31, 2023. This was partially offset by lower cost of purchases as a percentage of revenue in the three months ended March 31, 2023, and organic growth within the business.
Source:Â Stran
The preceding press release was provided by a company unaffiliated with Promo Marketing. The views expressed within do not directly reflect the thoughts or opinions of Promo Marketing.
