Arizona Tribune - Envela Reports First Quarter 2026 Financial Results

Management Commentary

"We are pleased to report our results for the first fiscal quarter of 2026, with contributions from both our Consumer and Commercial segments," said John Loftus, CEO of Envela. "Building on a strong fourth quarter and holiday season, we saw continued customer activity across our platforms during the quarter, supported by constructive market conditions in precious metals and secondary goods, along with elevated inbound sourcing activity and steady demand across our operations. We also continued to execute on our expansion strategy, including the opening of a new retail store on May 1^st."

"We further optimized our balance sheet during the first quarter of 2026, supported by a disciplined approach to capital and liquidity management," said John DeLuca, CFO of Envela. "Our liquidity position provides flexibility to support customer demand across varying market conditions, including periods of commodity price volatility and broader macroeconomic uncertainty. We continued to invest in our capabilities to support efficiency and scalability, while maintaining disciplined inventory management and financial strength across the Company's platforms."

First Quarter 2026 Financial Highlights

First Quarter 2026 Consolidated Operating Highlights

• First quarter revenue was $98.4 million, compared to $48.3 million in the prior-year quarter.

• First quarter gross margin was $20.6 million, compared to $12.0 million in the prior-year quarter.

• First quarter operating expenses were $9.4 million, compared to $8.8 million in the prior-year quarter.

• First quarter operating income was $11.2 million, compared to $3.1 million in the prior-year quarter.

• First quarter net income was $8.8 million, or $0.34 per basic and diluted share, compared to $2.5 million, or $0.10 per basic and diluted share, in the prior-year quarter.

• First quarter Adjusted EBITDA was $11.7 million, compared to $3.6 million in the prior-year quarter.

• First quarter Adjusted EBITDAR was $12.5 million, compared to $4.2 million in the prior-year quarter.

First Quarter Consumer Segment Operating Highlights

• Consumer segment revenue was $81.8 million in the first quarter of 2026, compared to $36.8 million in the prior-year quarter.

• Consumer segment gross margin was $9.7 million in the first quarter of 2026, compared to $4.2 million in the prior-year quarter.

• Consumer segment operating expenses were $4.3 million in the first quarter of 2026, compared to $4.1 million in the prior-year quarter.

• Consumer segment operating income was $5.4 million in the first quarter of 2026, compared to $0.1 million in the prior-year quarter.

• Consumer segment net income was $4.3 million in the first quarter of 2026, compared to $0.1 million in the prior-year quarter.

• Consumer segment Adjusted EBITDA was $5.6 million in the first quarter of 2026, compared to $0.3 million in the prior-year quarter.

• Consumer segment Adjusted EBITDAR was $5.9 million in the first quarter of 2026, compared to $0.6 million in the prior-year quarter.

First Quarter Commercial Segment Operating Highlights

• Commercial segment revenue was $16.6 million in the first quarter of 2026, compared to $11.5 million in the prior-year quarter.

• Commercial segment gross margin was $10.9 million in the first quarter of 2026, compared to $7.8 million in the prior-year quarter.

• Commercial segment operating expenses were $5.1 million in the first quarter of 2026, compared to $4.8 million in the prior-year quarter.

• Commercial segment operating income was $5.8 million in the first quarter of 2026, compared to $3.0 million in the prior-year quarter.

• Commercial segment net income was $4.5 million in the first quarter of 2026, compared to $2.4 million in the prior-year quarter.

• Commercial segment Adjusted EBITDA was $6.1 million in the first quarter of 2026, compared to $3.2 million in the prior-year quarter.

• Commercial segment Adjusted EBITDAR was $6.5 million in the first quarter of 2026, compared to $3.6 million in the prior-year quarter.

Balance Sheet, Cash Flow, and Liquidity

• Cash and cash equivalents were $38.6 million on March 31, 2026, compared to $18.2 million on December 31, 2024.

• The Company's long-term debt was $9.8 million on March 31, 2026, compared to $9.9 million on December 31, 2024.

• Total shareholders' equity was $75.9 million on March 31, 2026, compared to $67.1 million on December 31, 2024.

• For the three months ended March 31, 2026, consolidated operating cash flows totaled $21.2 million.

Share Repurchase Program

There were no repurchases of common stock during the quarter ended March 31, 2026. Since the beginning of the share repurchase program in March of 2023, Envela has spent more than $4.8 million to purchase 961,155 shares of common stock under the share repurchase program authorized through March 31, 2028.

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.

The following tables provide a reconciliation of net income to Adjusted EBITDA for the three months ended March 31, 2026 and 2025:

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(1) Adjusted EBITDA is defined as the sum of (i) net income (loss) of the Company, adjusted for additions (deductions) of (ii) interest expense, (iii) other (income) expense, (iv) income tax expense (benefit), and (v) depreciation and amortization. Management considers Adjusted EBITDA to be a key financial measure to assess our overall operating performance. The Company's Adjusted EBITDA is considered a non-U.S. GAAP financial measure and is not calculated in accordance with, or preferable to, "net income" or other financial measures of operating performance calculated in accordance with U.S. GAAP.

(2) Adjusted EBITDAR is defined as (i) Adjusted EBITDA plus (ii) minimum fixed rent expense for properties occupied under operating leases. Management considers Adjusted EBITDAR to be a key financial measure to assess our overall operating performance, excluding the impact of variability in leasing methods and capital structures. This measure is also an input into the Company's leverage ratios. The Company's Adjusted EBITDAR is considered a non-U.S. GAAP financial measure and is not calculated in accordance with, or preferable to, "net income" or other financial measures of operating performance calculated in accordance with U.S. GAAP.

(3) The table below depicts the calculation of rent expense and reconciles rent expense to total lease cost, per ASC 842, the most directly comparable U.S. GAAP financial measure for the year ended March 31, 2026 and 2025:

The following table reconciles components of the Debt to Adjusted EBITDA Leverage Ratio and Net Debt to Adjusted EBITDA Leverage Ratio for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

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(1) Debt Obligations are defined as the sum of amounts outstanding under notes payable balances.

(2) Total Cash is defined as the Company's cash and cash equivalents.

(3) Net Debt Obligations are defined as the difference between the Company's (i) Debt Obligations and (ii) Total Cash.

(4) The presentation of net income and Adjusted EBITDA for March 31, 2026, represents the total amount of net income and Adjusted EBITDA for the trailing four quarters ended March 31, 2026.

(5) Debt to Net Income Leverage Ratio is defined as (i) Debt Obligations divided by (ii) net income. The Company considers this measure to be the representative financial measure of our ability to service "notes payable" utilizing U.S. GAAP-derived financial statement balances. Management considers this financial measure to be helpful in understanding the Company's ability to service Debt Obligations.

(6) Debt to Adjusted EBITDA Leverage Ratio is defined as the Company's (i) Debt Obligations divided by (ii) Adjusted EBITDA. Management considers this financial measure to be helpful in understanding the Company's ability to service Debt Obligations.

(7) Net Debt to Adjusted EBITDA Leverage Ratio is defined as the Company's (i) Net Debt Obligations divided by (ii) Adjusted EBITDA. Management considers this financial measure to be helpful in understanding the Company's ability to service Debt Obligations.

The following table reconciles components of the Adjusted Debt to Adjusted EBITDAR Leverage Ratio and Adjusted Net Debt to Adjusted EBITDAR Leverage Ratio for the trailing four quarters ended March 31, 2026 and for the year ended December 31, 2025:

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(1) Adjusted Debt Obligations are defined as the sum of the Company's (i) Debt Obligations and (ii) operating lease liabilities.

(2) Adjusted Net Debt Obligations are defined as the difference between the Company's (i) Adjusted Debt Obligations and (ii)Total Cash.

(3) The presentation of net income and Adjusted EBITDAR for March 31, 2026, represents the total amount of net income and Adjusted EBITDAR for the trailing four quarters ended March 31, 2026.

(4) Adjusted Debt to Net Income Leverage Ratio is defined as the sum of (i) Debt Obligations and (ii) operating lease liabilities divided by (iii) net income. The Company considers this measure to be the representative financial measure of our ability to service "notes payable" and "operating leases" utilizing U.S. GAAP-derived financial statement balances. Management considers this financial measure to be helpful in understanding the Company's ability to service debt and operating lease obligations.

(5) Adjusted Debt to Adjusted EBITDAR Leverage Ratio is defined as the Company's (i) Adjusted Debt Obligations divided by (ii) Adjusted EBITDAR. Management considers this financial measure to be helpful in understanding the Company's ability to service debt and operating lease obligations.

(6) Adjusted Net Debt to Adjusted EBITDAR Leverage Ratio is defined as the Company's (i) Adjusted Net Debt Obligations divided by (ii) Adjusted EBITDAR. Management considers this financial measure to be helpful in understanding the Company's ability to service debt and operating lease obligations.

The following table reconciles Net Cash⁽¹⁾ to its comparable U.S. GAAP financial measures:

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(1) Net Cash is defined as the difference between the Company's (i) Total Cash and (ii) Debt Obligations. The Company's Net Cash is considered a non-U.S. GAAP financial measure and is not calculated in accordance with, or preferable to, "cash and cash equivalents" and amounts outstanding under "notes payable" balances or other financial measures of liquidity calculated in accordance with U.S. GAAP. Management considers this financial measure to be helpful in the understanding of the Company's liquidity.

The following table reconciles Free Cash Flow⁽¹⁾ to the comparable U.S. GAAP financial measures for the three months ended March 31, 2026 and March 31, 2025:

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(1) Free Cash Flow is defined as the difference between the Company's (i) net cash provided by operations ("Operating Cash Flow") and (ii) Capital Expenditures, which the Company defines as any purchases of property and equipment or intangible assets. The Company's Free Cash Flow is considered a non-U.S. GAAP financial measure and is not calculated in accordance with, or preferable to, "net cash provided by operations" or other financial measures of cash flow available to meet financing needs calculated in accordance with U.S. GAAP.

Envela will report more complete earnings in its Form 10-Q. Certain percentages and financial data may have been rounded. As a result of such rounding, the totals of data presented in this document may vary slightly from the actual arithmetical totals of such data.

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 | Texas: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 "may," "will," "should," "could," "can," "would," "believe," "anticipate," "project," "plan," "expect," "estimate," "goal," "seek," "ensure," "potential," "opportunity," "intend," "predict," "committed," "likely," "continue," "strive," "aim," "scheduled," "focused on," "long-term," "future," "over time," "ongoing," "uncertain," "moving forward," "subject to," or 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

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