The recent acquisition of Marucci Sports and Boa Technology drove Compass Diversified’s (CODI) gains, with revenues for the first quarter surging by 38.4 percent from the year-ago quarter to $461.6 million. In addition, net income reached $22.0 million, up from $4.9 million last year. Excluding Marucci and Boa, organic revenues climbed by around 14 percent.
The gross margin jumped by 4.7 percentage points to 40.5 percent, while adjusted Ebitda was $88.0 million compared to $46.0 million for the same quarter in 2020.
CODI bought Marucci, which makes baseball and softball equipment, for $200 million in April 2020 and then followed up with the $454 million purchase of Boa Technology, which owns the Boa Fit System for shoe fastening, in September.
Boa’s revenues were up by 37.5 percent to $36.4 million from $26.5 million, while the Ebitda soared by 76 percent versus the comparable period in 2020 to $14.0 million. The brand recorded growth across all categories, led by cycling, outdoor and golf. However, the management admitted that some portion of Boa’s growth stems from brand partners ordering ahead due to supply constraints associated with slowdowns in global shipping and to ensure solid inventory levels for consumers at retail. However, it added that most of this growth was driven by underlying strong demand for products using the Boa Fit System and increased market share across multiple categories for these products.
Besides Boa and Marucci, CODI’s consumer brands also include 5.11, Liberty Safe, Velocity Outdoor, Ergobaby and Sterno. They all posted sales growth in the quarter.
The management has released its annual guidance and expects adjusted Ebitda for the full year of 2021 of between $325 million and $345 million, representing a growth of 11 to 18 percent from the prior year.