Arizona Tribune - Envela Reports Second Quarter 2025 Financial Results

Management Commentary

"Our team delivered strong second quarter results, driven by disciplined execution across both our consumer and commercial businesses," said John Loftus, Envela's CEO. "In our consumer business, we continue to optimize the operating model as we scale our retail footprint. On the commercial side, our service-based returns business is becoming a more significant revenue driver, contributing to higher gross margins, while we remain disciplined in managing overhead."

"Overall, our operating income grew 70.5% compared to the same quarter last year, driven by strong contributions from the consumer and commercial segments," said John DeLuca, Envela's CFO. "The consumer segment benefited from growth in wholesale precious metals and increased retail store revenues. The commercial segment saw improved margins from a favorable product mix and its service-based returns business, despite lower volumes. We also maintained disciplined overhead control, enabling a 38.4% increase in net cash to $9.8 million as of June 30, 2025."

"This quarter also marked our inclusion in the U.S. Small-Cap Russell 2000 Index, reflecting our progress and long-term value creation," added Loftus. "As we look to the second half of the year, we remain focused on customers, operational discipline, and our ability to sustain strong performance and deliver continued growth."

Second Quarter 2025 Financial Highlights

Envela will report more complete earnings in its Form 10-Q.

Second Quarter 2025 Consolidated Operating Highlights

• Second quarter revenue was $54.9 million, compared to $45.3 million in the prior-year quarter.

• Second quarter gross margin decreased to 22.6% of quarterly revenue, compared to 25.1% in the prior-year quarter.

• Second quarter operating expenses were $9.1 million, compared to $9.5 million in the prior-year quarter.

• Second quarter operating income was $3.3 million, or 5.9% of revenue, compared to $1.9 million, or 4.2% of revenue in the prior-year quarter.

• Second quarter net income was $2.8 million, or $0.11 per basic and diluted share, compared to $1.6 million or $0.06 per basic and diluted shared in the prior-year quarter.

• Second quarter Adjusted EBITDA was $3.7 million or 6.8% of revenue, compared to $2.3 million or 5.0% of revenue in the prior-year quarter.

Second Quarter Consumer Division Operating Highlights

• Consumer Division revenue was $43.2 million in the second quarter of 2025, compared to $32.0 million in the prior-year quarter.

• Consumer Division gross margin was 10.8% of revenue in the second quarter of 2025, compared to 12.6% in the prior-year quarter.

• Consumer Division operating expenses were $3.9 million in the second quarter of 2025, compared to $4.1 million in the prior-year quarter.

• Consumer Division operating income was $0.7 million in the second quarter of 2025, compared to a $0.1 million operating loss in the prior-year quarter.

• Consumer Division net income was $0.6 million in the second quarter of 2025, compared to a $0.2 million net loss in the prior-year quarter.

Second Quarter Commercial Division Operating Highlights

• Commercial Division revenue was $11.7 million in the second quarter of 2025, compared to $13.3 million in the prior-year quarter

• Commercial Division gross margin was 66.1% of revenue in the second quarter of 2025, compared to 55.4% in the prior-year quarter.

• Commercial Division operating expenses were $5.2 million in the second quarter of 2025, compared to $5.4 million in the prior-year quarter.

• Commercial Division operating income was $2.5 million in the second quarter of 2025, compared to $2.0 million in the prior-year quarter.

• Commercial Division net income was $2.1 million in the second quarter of 2025, compared to $1.7 million in the prior-year quarter.

Balance Sheet, Cash Flow and Liquidity

• Cash and cash equivalents was $22.9 million on June 30, 2025, compared to $20.6 million on December 31, 2024.

• The Company's long-term debt was $13.0 million on June 30, 2025, compared to $13.5 million on December 31, 2024.

• Total shareholders' equity was $57.8 million on June 30, 2025, compared to $52.7 million on December 31, 2024.

• For the six months ended June 30, 2025, consolidated operating cash flows totaled $3.7 million.

Share Repurchase Program

For the quarter ended June 30, 2025, the Company repurchased 20,163 shares of common stock at a cost of $118.7 thousand. Since the beginning of the share repurchase program in March of 2023, Envela has spent more than $4.7 million to purchase 949,593 shares of common stock under the share repurchase program authorized through March 31, 2026.

On March 27, 2025, the Board of Directors authorized the repurchase of an additional 100,000 shares of the Company's common stock, bringing the total authorization under the existing repurchase program to 1,100,000 shares.

Non-GAAP Financial Measures

This press release contains non-United States ("U.S.") Generally Accepted Accounting Principles ("GAAP") financial measures. A "non-U.S. GAAP financial measure" is defined as a numerical measure of a company's financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with U.S. GAAP in the statements of income, balance sheets or statements of cash flows of the Company.

Adjusted EBITDA is a key performance measure that management uses to assess our operating performance. Because adjusted EBITDA facilitates internal comparisons of our historical operating performance on a more consistent basis, we use this measure as an overall assessment of our performance, to evaluate the effectiveness of our strategies and for planning purposes. Adjusted EBITDA may not be comparable to similarly titled metrics of other companies. Adjusted EBITDA is defined as the sum of net income (loss) of the Company, adjusted for additions (deductions) of interest expense, other (income) expense, income tax expense (benefit), and depreciation and amortization. Adjusted EBITDA is a non-GAAP financial measure and should not be considered is an alternative to the presentation of net income or any other measure of financial performance calculated and presented in accordance with U.S. GAAP.

The following tables provides a reconciliation of net income to Adjusted EBITDA for the three months ended June 30, 2025 and 2024:

Net cash is defined as the difference between (i) cash and cash equivalents and (ii) the sum of debt obligations. We believe that presenting net cash is useful to investors as a measure of our liquidity and leverage profile, as cash and cash equivalents can be used, among other things, to repay indebtedness.

Envela periodically provides information for investors on its corporate website, envela.com. This includes press releases, quarterly investor presentations and other information about financial performance, reports filed or furnished with the Securities and Exchange Commission ("SEC"), information on corporate governance, and details related to its annual meeting of shareholders.

About Envela®

Envela Corporation (NYSE American:ELA) is a leading provider of re-commerce services, driving innovation at the forefront of the circular economy. We Reuse, Recycle, and Reimagine to offer consumers alternatives, contribute to environmental sustainability, and maximize product value. As a sustainability-focused company, Envela extends product lifecycles to minimize resource consumption and carbon emissions. By focusing on our core strengths, we create exceptional value and strive to leave the world better than we found it.

The company operates through two primary business segments: Consumer and Commercial. The Consumer segment includes retail stores and online platforms offering premium brands and luxury hard assets, while the Commercial segment delivers tailored re-commerce solutions to clients, including many Fortune 500 companies. To learn more about our innovative approach, visit Envela.com.

Cautionary Statement Regarding Forward-Looking Information

This press release contains statements that may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995's safe harbor provisions, including statements regarding future events and developments; potential expansions, purchases and acquisitions; potential future success of business lines and strategies; and management's expectations, beliefs, plans, estimates and projections relating to the future. Words such as "believes," "anticipates," "plans," "may," "intends," "will," "should," "expects" and similar expressions are intended to identify forward-looking statements. Forward-looking statements are based on management's then current views and assumptions and, as a result, are subject to certain risks and uncertainties, which could cause the Company's actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, risks described more fully in Item 1A in the Company's Annual Report on Form 10-K, which are expressly incorporated herein by reference, and other factors as may periodically be described in the Company's filings with the SEC. By making these statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release except as required by law.

Investor Relations Contact

[email protected]
972-587-4030

SOURCE: Envela Corporation

View the original press release on ACCESS Newswire

M.O.Allen--AT