Breaking Down Crown Crafts, Inc. (CRWS) Financial Health: Key Insights for Investors

Are you keeping a close watch on Crown Crafts, Inc. (CRWS) and wondering about its financial stability? Let's delve into the key insights from their fiscal year 2024, which ended on March 31, 2024. The company reported net sales of $87.6 million, a notable increase from $75.1 million in fiscal year 2023. However, the gross margin experienced a slight dip to 26.2% compared to 26.4% in the previous year. Net income stood at $4.9 million, translating to $0.48 per diluted share. But how does this translate into long-term potential for investors? Read on to find out!

Crown Crafts, Inc. (CRWS) Revenue Analysis

Crown Crafts, Inc. (CRWS) primarily generates revenue through the sale of infant, toddler, and juvenile consumer products. These products include bedding, blankets, bibs, bath items, and accessories. The company distributes its products through various channels, including mass merchants, chain stores, juvenile specialty stores, and e-commerce platforms.

Analyzing Crown Crafts, Inc.'s revenue streams involves understanding the year-over-year revenue growth rate, the contribution of different business segments, and any significant changes in these areas. While specific year-over-year revenue growth rates require up-to-date financial data, historical trends can provide insights into the company's performance. For instance, fluctuations in consumer spending, changes in distribution strategies, and the introduction of new product lines can all impact revenue growth.

To get a clearer picture, it's helpful to consider potential factors influencing revenue:

• Product Innovation: The success of new product launches and their acceptance in the market.
• Market Trends: Shifts in consumer preferences and demand for specific product categories.
• Distribution Channels: The effectiveness of sales through mass merchants, specialty stores, and online platforms.
• Economic Conditions: Overall economic health and its impact on consumer spending.

A detailed revenue breakdown would typically segment revenue by product category (e.g., bedding, blankets, accessories) and distribution channel. This segmentation helps in identifying which areas are driving growth and which may need improvement. Keep in mind that changes in revenue streams can occur due to strategic decisions, such as entering new markets, discontinuing underperforming products, or forming partnerships.

For a deeper dive into the company's core values and strategic objectives, consider exploring Mission Statement, Vision, & Core Values of Crown Crafts, Inc. (CRWS).

Crown Crafts, Inc. (CRWS) Profitability Metrics

Analyzing Crown Crafts, Inc.'s profitability involves examining several key metrics to understand the company's financial health and operational efficiency. These metrics include gross profit, operating profit, and net profit margins, as well as trends in profitability over time and comparisons with industry averages.

Crown Crafts, Inc. reported its financial results for the third quarter of fiscal year 2024, which ended on December 29, 2024. Net sales for the quarter were $21.7 million, and net income was $1.1 million, or $0.11 per diluted share. For the first nine months of fiscal year 2024, net sales totaled $63.6 million, and net income was $2.4 million, or $0.24 per diluted share.

Here’s a look at some key profitability metrics:

• Gross Profit: Gross profit is the revenue a company has left after deducting the cost of goods sold (COGS). It indicates how efficiently a company manages its production costs.
• Operating Profit: Operating profit is calculated by deducting operating expenses from gross profit. It reflects the profitability of a company's core business operations before interest and taxes.
• Net Profit: Net profit is what remains after all expenses, including interest and taxes, are deducted from total revenue. It represents the actual profit available to shareholders.

To get a clearer picture, here's a summary of Crown Crafts' financial performance:

When evaluating Crown Crafts' profitability, it's essential to consider these trends in the context of the broader industry. Comparing the company's profit margins and operational efficiency with those of its competitors can provide valuable insights into its relative performance.

Further insights into Crown Crafts, Inc. (CRWS) can be found here: Exploring Crown Crafts, Inc. (CRWS) Investor Profile: Who’s Buying and Why?

Crown Crafts, Inc. (CRWS) Debt vs. Equity Structure

Understanding how Crown Crafts, Inc. (CRWS) finances its operations and growth is crucial for investors. This involves looking at the company’s debt levels, its debt-to-equity ratio, and how it strategically uses debt versus equity.

As of the most recent financial reporting period, Crown Crafts, Inc.'s approach to debt and equity financing includes:

• Total Long-Term Debt: $28.79 million as of December 2024.
• Short-Term Debt & Capital Lease Obligation: $5.89 million as of December 2024.
• Total Shareholders' Equity: $51.1 million.

The debt-to-equity ratio can be calculated using the provided data:

Debt-to-Equity Ratio = Total Debt / Total Shareholder Equity

Total Debt = Long-Term Debt + Short-Term Debt = $28.79 million + $5.89 million = $34.68 million

Debt-to-Equity Ratio = $34.68 million / $51.1 million = 0.679 or 67.9%

This ratio indicates that Crown Crafts has about 67.9 cents of debt for every dollar of equity.

Key observations regarding Crown Crafts, Inc.'s debt financing include:

• Credit Rating: A recent report indicates a current credit rating of BBB-.
• Interest Expense: The company incurs an interest expense of $412,000 annually.
• Weighted Average Interest Rate: The weighted average interest rate on its debt is 4.75%.

Regarding equity structure:

• Total Outstanding Shares: There are 10.39 million shares outstanding.
• Common Stock Par Value: The par value of common stock is $0.01 per share.
• Market Capitalization: The company's market capitalization is approximately $29.73 million.

In July 2024, Crown Crafts acquired substantially all of the assets of Baby Boom Consumer Products, Inc. for $18 million. This acquisition was financed through a combination of an $8 million term loan and additional borrowings under Crown Crafts' revolving line of credit. The term loan is repayable monthly over four years. The term of the line of credit was extended from July 11, 2028, to July 19, 2029, and its borrowing capacity increased from $35 million to $40 million.

Crown Crafts amended its financing agreement with CIT, waiving certain compliance requirements and adjusting credit availability terms.

Here's a summary of Crown Crafts, Inc.'s debt and equity structure:

For more insights into Crown Crafts, Inc.'s financial health, you can check out: Breaking Down Crown Crafts, Inc. (CRWS) Financial Health: Key Insights for Investors

Crown Crafts, Inc. (CRWS) Liquidity and Solvency

Liquidity is a critical aspect of a company's financial health, indicating its ability to meet short-term obligations. Let's evaluate the liquidity position of Crown Crafts, Inc. (CRWS) through an analysis of key financial ratios and cash flow trends. You might also be interested in: Breaking Down Crown Crafts, Inc. (CRWS) Financial Health: Key Insights for Investors

Here’s an overview of Crown Crafts, Inc.’s liquidity based on the available data:

Assessing Crown Crafts, Inc.'s Liquidity

Several financial metrics can provide insights into the liquidity of Crown Crafts, Inc.

• Current Ratio: A healthy current ratio suggests that a company has enough liquid assets to cover its short-term liabilities. According to InvestingPro analysis from March 2025, Crown Crafts, Inc. maintains a current ratio of 3.36, indicating strong liquidity.
• Quick Ratio: The quick ratio, which excludes inventories from current assets, provides a more conservative measure of liquidity. For the quarter that ended in December 2024, Crown Crafts's quick ratio was 1.60. This ratio is better than 66.21% of companies in the Furnishings, Fixtures & Appliances industry.

Working Capital Trends

Analyzing the trends in working capital can reveal how efficiently Crown Crafts, Inc. is managing its short-term assets and liabilities. A consistent increase in working capital indicates improved liquidity, while a decrease may signal potential challenges.

Cash Flow Statements Overview

An examination of cash flow statements offers insights into the company's ability to generate cash from its operations, investments, and financing activities.

• Operating Activities: For the nine months ended December 29, 2024, net income was reported as $1.431 million, compared to $3.890 million for the nine months ended December 31, 2023.
• Cash and Equivalents: Crown Crafts reported an increase in cash and equivalents to $1.1 million, up from $829,000. Additionally, cash flow from operations increased to $7 million from $4.1 million.

Potential Liquidity Concerns or Strengths

Despite a challenging market environment, Crown Crafts, Inc. demonstrates several strengths in its liquidity position:

• Healthy Ratios: A current ratio of 3.36 and a quick ratio of 1.60 indicate a solid ability to cover short-term obligations.
• Improved Cash Flow: Increased cash and equivalents, along with improved cash flow from operations, suggest enhanced financial flexibility.
• Consistent Dividends: The company has consistently paid dividends for 16 consecutive years, reflecting a stable financial position.

While the company has faced declines in net income and sales, proactive management and integration of acquisitions like Baby Boom show efforts to navigate economic headwinds and improve profitability.

Crown Crafts, Inc. (CRWS) Valuation Analysis

Determining whether Crown Crafts, Inc. (CRWS) is overvalued or undervalued involves analyzing several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, alongside stock price trends, dividend yield, payout ratios, and analyst consensus.

As of now, comprehensive real-time data for 2024 fiscal year for these specific valuation metrics of Crown Crafts, Inc. is not available. The latest information on these metrics would typically be found on financial data platforms such as Yahoo Finance, Bloomberg, or through analyst reports. However, we can discuss how these metrics are generally used to assess valuation.

Price-to-Earnings (P/E) Ratio: This ratio compares a company's stock price to its earnings per share (EPS). A lower P/E ratio might suggest that a stock is undervalued, while a higher P/E ratio could indicate overvaluation. It's crucial to compare Crown Crafts, Inc.'s P/E ratio to its industry peers and its historical P/E ratio to get a meaningful perspective.

Price-to-Book (P/B) Ratio: The P/B ratio compares a company's market capitalization to its book value of equity. A lower P/B ratio can suggest undervaluation, implying that the stock price is low relative to the company's net asset value. This is particularly relevant for companies with substantial tangible assets.

Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: This ratio compares a company's enterprise value (total market value plus debt, minus cash) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). It provides a more comprehensive valuation measure than the P/E ratio, as it takes into account a company's debt and capital structure. A lower EV/EBITDA ratio may indicate undervaluation.

Stock Price Trends: Analyzing the stock price trends over the last 12 months (or longer) can provide insights into market sentiment and investor confidence. A consistent upward trend may suggest positive market perception, while a downward trend could indicate concerns about the company's performance or prospects.

Dividend Yield and Payout Ratios: If Crown Crafts, Inc. pays dividends, the dividend yield (annual dividend per share divided by stock price) and payout ratio (percentage of earnings paid out as dividends) are important valuation considerations. A higher dividend yield can make a stock more attractive to income-seeking investors, while a sustainable payout ratio indicates the company's ability to maintain its dividend payments.

Analyst Consensus: Monitoring analyst ratings (buy, hold, or sell) and price targets can provide additional insights into stock valuation. Analyst opinions reflect their assessment of a company's prospects and can influence investor sentiment.

Without specific real-time 2024 fiscal year data, a general approach to determining if Crown Crafts, Inc. is overvalued or undervalued involves:

• Comparing its valuation ratios (P/E, P/B, EV/EBITDA) to industry averages.
• Analyzing its stock price trends and dividend metrics.
• Considering analyst consensus and macroeconomic factors.

For detailed insights into Crown Crafts, Inc.'s investors, consider reading: Exploring Crown Crafts, Inc. (CRWS) Investor Profile: Who’s Buying and Why?

Crown Crafts, Inc. (CRWS) Risk Factors

Understanding the risks facing Crown Crafts, Inc. (CRWS) is crucial for investors assessing the company's financial health and future prospects. These risks span both internal and external factors, including industry competition, regulatory changes, and overall market conditions.

Here's an overview of key risks that could impact Crown Crafts, Inc.'s (CRWS) financial performance:

• Industry Competition: The juvenile products market is highly competitive. Intense competition could pressure Crown Crafts, Inc.'s (CRWS) profit margins and market share.
• Regulatory Changes: Changes in safety regulations or product standards could require costly modifications to Crown Crafts, Inc.'s (CRWS) product lines.
• Market Conditions: Economic downturns or shifts in consumer spending habits could reduce demand for Crown Crafts, Inc.'s (CRWS) products.

Based on the latest available information, here are some specific operational, financial, and strategic risks:

• Customer Concentration: A significant portion of Crown Crafts, Inc.'s (CRWS) sales may be concentrated among a few major retailers. Losing one or more of these key customers could substantially reduce revenue.
• Supply Chain Disruptions: Disruptions to the supply chain, whether due to global events, natural disasters, or other factors, could increase costs and delay production.
• Inventory Management: Inefficient inventory management could lead to excess inventory, resulting in increased storage costs and potential obsolescence.

Mitigation strategies that Crown Crafts, Inc. (CRWS) might employ to address these risks include:

• Diversifying its customer base: Reducing reliance on a small number of large retailers can cushion the impact of losing a major customer.
• Strengthening supply chain relationships: Building strong relationships with suppliers and diversifying sourcing options can minimize disruptions.
• Implementing advanced inventory management systems: Using technology to optimize inventory levels can reduce costs and improve efficiency.

For more insights into Crown Crafts, Inc.'s (CRWS) values, read about Mission Statement, Vision, & Core Values of Crown Crafts, Inc. (CRWS).

Crown Crafts, Inc. (CRWS) Growth Opportunities

For investors eyeing Crown Crafts, Inc. (CRWS), understanding the company's future growth prospects is crucial. Several factors suggest potential avenues for expansion and increased profitability.

Key growth drivers for Crown Crafts, Inc. (CRWS) include a focus on product innovation, particularly in the realm of safety-oriented and eco-friendly baby products. Market expansion efforts, both domestically and internationally, also play a significant role. While specific details on recent acquisitions are not available, strategic acquisitions have historically been part of Crown Crafts, Inc. (CRWS)'s growth strategy.

While precise revenue growth projections and earnings estimates require up-to-date financial analysis, several strategic initiatives could drive future growth for Crown Crafts, Inc. (CRWS):

• Product Development: Investing in innovative, high-margin products that meet evolving consumer demands.
• Licensing Agreements: Expanding brand reach through strategic licensing partnerships.
• Distribution Channels: Strengthening relationships with major retailers and exploring e-commerce opportunities.

Crown Crafts, Inc. (CRWS) holds several competitive advantages that could position it favorably for future growth:

• Established Brand Reputation: A long-standing presence in the juvenile products market.
• Strong Retail Partnerships: Existing relationships with key retailers provide a solid distribution network.
• Focus on Safety and Innovation: A commitment to developing safe and innovative products that resonate with parents.

More details about the financial health of Crown Crafts, Inc. (CRWS) can be found here: Breaking Down Crown Crafts, Inc. (CRWS) Financial Health: Key Insights for Investors