2023 Q2 Form 10-Q Financial Statement

#000186872623000037 Filed on May 09, 2023

View on sec.gov

Income Statement

Concept 2023 Q2 2023 Q1 2022 Q1
Revenue $109.2M $113.8M $186.2M
YoY Change -48.2% -38.89% 57.63%
Cost Of Revenue $31.75M $32.98M $44.99M
YoY Change -41.72% -26.7% 83.46%
Gross Profit $77.50M $80.81M $141.2M
YoY Change -50.46% -42.77% 50.87%
Gross Profit Margin 70.94% 71.02% 75.84%
Selling, General & Admin $48.41M $34.92M $22.31M
YoY Change 85.41% 56.51% 97.82%
% of Gross Profit 62.47% 43.22% 15.8%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $10.32M $116.0K $75.00K
YoY Change -17.75% 54.67%
% of Gross Profit 13.32% 0.14% 0.05%
Operating Expenses $58.74M $45.25M $32.58M
YoY Change 61.34% 38.88% 51.8%
Operating Profit $18.76M $35.56M $108.6M
YoY Change -84.37% -67.26% 50.59%
Interest Expense -$10.21M $10.54M $11.46M
YoY Change 17.39% -8.0% -26.07%
% of Operating Profit -54.41% 29.65% 10.55%
Other Income/Expense, Net -$600.0K $242.0K -$19.18M
YoY Change -50.98% -101.26% 40708.51%
Pretax Income $7.953M $25.26M $77.99M
YoY Change -92.78% -67.61% 37.82%
Income Tax $1.797M $4.298M $16.02M
% Of Pretax Income 22.6% 17.01% 20.55%
Net Earnings $6.156M $20.96M $61.96M
YoY Change -92.98% -66.17% 36.09%
Net Earnings / Revenue 5.64% 18.42% 33.28%
Basic Earnings Per Share $0.01 $0.03 $0.10
Diluted Earnings Per Share $0.01 $0.03 $0.09
COMMON SHARES
Basic Shares Outstanding 654.3M shares 651.9M shares 648.8M shares
Diluted Shares Outstanding 680.3M shares 683.5M shares 693.0M shares

Balance Sheet

Concept 2023 Q2 2023 Q1 2022 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $378.4M $369.3M $143.3M
YoY Change 91.09% 157.65%
Cash & Equivalents $378.4M $369.3M $143.3M
Short-Term Investments
Other Short-Term Assets $13.40M $16.67M $8.196M
YoY Change 132.4% 103.33%
Inventory $128.5M $132.0M $117.5M
Prepaid Expenses
Receivables $50.30M $45.52M $68.91M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $570.6M $563.5M $337.9M
YoY Change 34.12% 66.76%
LONG-TERM ASSETS
Property, Plant & Equipment $932.0K $1.026M $740.0K
YoY Change 39.1% 38.65%
Goodwill $168.3M $168.3M $168.3M
YoY Change 0.0%
Intangibles $971.7M $983.0M $1.031B
YoY Change -4.68%
Long-Term Investments $6.364M
YoY Change
Other Assets $11.35M $10.00M $6.364M
YoY Change -4.44% 57.2%
Total Long-Term Assets $1.152B $1.162B $1.217B
YoY Change -4.47% -4.47%
TOTAL ASSETS
Total Short-Term Assets $570.6M $563.5M $337.9M
Total Long-Term Assets $1.152B $1.162B $1.217B
Total Assets $1.723B $1.726B $1.555B
YoY Change 5.59% 11.01%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $13.67M $9.408M $29.01M
YoY Change -33.98% -67.56%
Accrued Expenses $24.65M $19.92M $11.36M
YoY Change -23.42% 75.33%
Deferred Revenue $2.077M $2.230M $5.004M
YoY Change -55.44%
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $6.750M $6.750M $6.750M
YoY Change 0.0% 0.0%
Total Short-Term Liabilities $61.25M $58.23M $82.17M
YoY Change -29.58% -29.14%
LONG-TERM LIABILITIES
Long-Term Debt $651.7M $653.0M $658.3M
YoY Change -0.81% -0.81%
Other Long-Term Liabilities $189.4M $205.7M $225.1M
YoY Change -9.16% -8.64%
Total Long-Term Liabilities $841.1M $653.0M $658.3M
YoY Change -2.82% -0.81%
TOTAL LIABILITIES
Total Short-Term Liabilities $61.25M $58.23M $82.17M
Total Long-Term Liabilities $841.1M $653.0M $658.3M
Total Liabilities $905.1M $919.2M $965.6M
YoY Change -4.98% -4.8%
SHAREHOLDERS EQUITY
Retained Earnings $492.0M $485.8M $282.7M
YoY Change 71.82%
Common Stock $654.0K $653.0K $648.0K
YoY Change 0.77%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $817.9M $806.6M $589.0M
YoY Change
Total Liabilities & Shareholders Equity $1.723B $1.726B $1.555B
YoY Change 5.59% 11.01%

Cashflow Statement

Concept 2023 Q2 2023 Q1 2022 Q1
OPERATING ACTIVITIES
Net Income $6.156M $20.96M $61.96M
YoY Change -92.98% -66.17% 36.09%
Depreciation, Depletion And Amortization $10.32M $116.0K $75.00K
YoY Change -17.75% 54.67%
Cash From Operating Activities $27.00M $48.09M $71.97M
YoY Change -51.86% -33.18% 74.3%
INVESTING ACTIVITIES
Capital Expenditures $1.365M $107.0K $68.00K
YoY Change -399.34% 57.35%
Acquisitions
YoY Change
Other Investing Activities -$1.996M
YoY Change
Cash From Investing Activities -$1.365M -$631.0K -$489.0K
YoY Change 199.34% 29.04%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $0.00
YoY Change -100.0%
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -16.56M -$926.0K -$114.5M
YoY Change 1648.15% -99.19% 2505.71%
NET CHANGE
Cash From Operating Activities 27.00M $48.09M $71.97M
Cash From Investing Activities -1.365M -$631.0K -$489.0K
Cash From Financing Activities -16.56M -$926.0K -$114.5M
Net Change In Cash 9.078M $46.53M -$43.04M
YoY Change -83.4% -208.11% -216.66%
FREE CASH FLOW
Cash From Operating Activities $27.00M $48.09M $71.97M
Capital Expenditures $1.365M $107.0K $68.00K
Free Cash Flow $25.63M $47.98M $71.90M
YoY Change -54.66% -33.27% 74.14%

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CY2022Q1 us-gaap Increase Decrease In Inventories
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CY2023Q1 us-gaap Increase Decrease In Accounts Payable
IncreaseDecreaseInAccountsPayable
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CY2022Q1 us-gaap Increase Decrease In Accounts Payable
IncreaseDecreaseInAccountsPayable
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CY2023Q1 us-gaap Increase Decrease In Accrued Liabilities
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CY2022Q1 us-gaap Increase Decrease In Accrued Liabilities
IncreaseDecreaseInAccruedLiabilities
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CY2023Q1 us-gaap Increase Decrease In Other Operating Capital Net
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CY2022Q1 us-gaap Increase Decrease In Other Operating Capital Net
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CY2022Q1 us-gaap Net Cash Provided By Used In Operating Activities
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CY2023Q1 us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
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CY2022Q1 us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
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CY2023Q1 us-gaap Payments To Acquire Software
PaymentsToAcquireSoftware
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CY2022Q1 us-gaap Payments To Acquire Software
PaymentsToAcquireSoftware
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CY2023Q1 us-gaap Net Cash Provided By Used In Investing Activities
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CY2022Q1 us-gaap Net Cash Provided By Used In Investing Activities
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ProceedsFromStockOptionsExercised
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ProceedsFromStockOptionsExercised
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PaymentsRelatedToTaxWithholdingForShareBasedCompensation
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PaymentsRelatedToTaxWithholdingForShareBasedCompensation
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RepaymentsOfSecuredDebt
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CY2022Q1 us-gaap Repayments Of Secured Debt
RepaymentsOfSecuredDebt
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CY2023Q1 us-gaap Proceeds From Issuance Of Secured Debt
ProceedsFromIssuanceOfSecuredDebt
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CY2022Q1 us-gaap Proceeds From Issuance Of Secured Debt
ProceedsFromIssuanceOfSecuredDebt
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CY2023Q1 us-gaap Payments Of Debt Issuance Costs
PaymentsOfDebtIssuanceCosts
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CY2022Q1 us-gaap Payments Of Debt Issuance Costs
PaymentsOfDebtIssuanceCosts
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CY2022Q1 us-gaap Net Cash Provided By Used In Financing Activities
NetCashProvidedByUsedInFinancingActivities
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CY2023Q1 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents Period Increase Decrease Including Exchange Rate Effect
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsPeriodIncreaseDecreaseIncludingExchangeRateEffect
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CY2022Q1 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents Period Increase Decrease Including Exchange Rate Effect
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsPeriodIncreaseDecreaseIncludingExchangeRateEffect
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CY2022Q4 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
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CY2021Q4 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
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CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
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CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
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IncomeTaxesPaid
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CY2022Q1 us-gaap Income Taxes Paid
IncomeTaxesPaid
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CY2023Q1 us-gaap Interest Paid Net
InterestPaidNet
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CY2022Q1 us-gaap Interest Paid Net
InterestPaidNet
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CY2023Q1 olpx Initial Public Offering Costs Incurred But Not Yet Paid
InitialPublicOfferingCostsIncurredButNotYetPaid
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CY2022Q1 olpx Initial Public Offering Costs Incurred But Not Yet Paid
InitialPublicOfferingCostsIncurredButNotYetPaid
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CY2023Q1 olpx Liability Reclassification To Additional Paid In Capital
LiabilityReclassificationToAdditionalPaidInCapital
0 usd
CY2022Q1 olpx Liability Reclassification To Additional Paid In Capital
LiabilityReclassificationToAdditionalPaidInCapital
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CY2023Q1 us-gaap Use Of Estimates
UseOfEstimates
<div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Estimates and Assumptions</span></div><div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. Examples of estimates and assumptions include: for revenue recognition, determining the nature and timing of satisfaction of performance obligations, variable consideration, and other obligations such as product returns and refunds; loss contingencies; the fair value of share-based options and stock settled stock appreciation rights (“SARs”); the fair value of and/or potential impairment of goodwill and intangible assets for the Company’s reporting unit; the fair value of the Company’s interest rate cap; useful lives of the Company’s tangible and intangible assets; allowance for promotions; estimated income tax and tax receivable payments; the net realizable value of, and demand for the Company’s inventory. Actual results and outcomes may differ from management’s estimates and assumptions due to risks and uncertainties.</span></div>
CY2021Q4 olpx Tax Receivable Agreement Percent Of Tax Benefits With Provided Payment
TaxReceivableAgreementPercentOfTaxBenefitsWithProvidedPayment
0.85
CY2021Q4 olpx Tax Receivable Agreement Percent Of Tax Benefits Retained By Company
TaxReceivableAgreementPercentOfTaxBenefitsRetainedByCompany
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CY2022Q4 us-gaap Due To Related Parties Current And Noncurrent
DueToRelatedPartiesCurrentAndNoncurrent
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CY2022 olpx Related Party Transaction Term Of Agreement
RelatedPartyTransactionTermOfAgreement
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CY2023Q1 us-gaap Prior Period Reclassification Adjustment Description
PriorPeriodReclassificationAdjustmentDescription
<div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Reclassifications</span></div><div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Certain amounts presented have been reclassified within “Note 6 - Accrued Expenses and Other Current Liabilities” as of </span><span style="color:#231f20;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">December 31, 2022</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> to conform with the current period presentation, including a prior year reclassification from Other accrued expenses and current liabilities to Accrued advertising. The reclassifications had no effect on the Company’s Total current liabilities.</span></div>
CY2023Q1 olpx Number Of Business Channels
NumberOfBusinessChannels
3 businesschannel
CY2023Q1 us-gaap Revenue From Contract With Customer Excluding Assessed Tax
RevenueFromContractWithCustomerExcludingAssessedTax
113787000 usd
CY2022Q1 us-gaap Revenue From Contract With Customer Excluding Assessed Tax
RevenueFromContractWithCustomerExcludingAssessedTax
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CY2023Q1 us-gaap Revenue From Contract With Customer Excluding Assessed Tax
RevenueFromContractWithCustomerExcludingAssessedTax
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CY2022Q1 us-gaap Revenue From Contract With Customer Excluding Assessed Tax
RevenueFromContractWithCustomerExcludingAssessedTax
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CY2023Q1 us-gaap Inventory Raw Materials Net Of Reserves
InventoryRawMaterialsNetOfReserves
40224000 usd
CY2022Q4 us-gaap Inventory Raw Materials Net Of Reserves
InventoryRawMaterialsNetOfReserves
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CY2023Q1 us-gaap Inventory Finished Goods Net Of Reserves
InventoryFinishedGoodsNetOfReserves
91790000 usd
CY2022Q4 us-gaap Inventory Finished Goods Net Of Reserves
InventoryFinishedGoodsNetOfReserves
108231000 usd
CY2023Q1 us-gaap Inventory Net
InventoryNet
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CY2022Q4 us-gaap Inventory Net
InventoryNet
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CY2023Q1 us-gaap Finite Lived Intangible Assets Gross
FiniteLivedIntangibleAssetsGross
1144446000 usd
CY2023Q1 us-gaap Finite Lived Intangible Assets Accumulated Amortization
FiniteLivedIntangibleAssetsAccumulatedAmortization
161484000 usd
CY2023Q1 us-gaap Finite Lived Intangible Assets Net
FiniteLivedIntangibleAssetsNet
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CY2023Q1 us-gaap Goodwill
Goodwill
168300000 usd
CY2023Q1 us-gaap Goodwill
Goodwill
168300000 usd
CY2023Q1 olpx Intangible Assets Gross Including Goodwill
IntangibleAssetsGrossIncludingGoodwill
1312746000 usd
CY2023Q1 us-gaap Finite Lived Intangible Assets Accumulated Amortization
FiniteLivedIntangibleAssetsAccumulatedAmortization
161484000 usd
CY2023Q1 us-gaap Intangible Assets Net Including Goodwill
IntangibleAssetsNetIncludingGoodwill
1151262000 usd
CY2022Q4 us-gaap Finite Lived Intangible Assets Gross
FiniteLivedIntangibleAssetsGross
1143922000 usd
CY2022Q4 us-gaap Finite Lived Intangible Assets Accumulated Amortization
FiniteLivedIntangibleAssetsAccumulatedAmortization
148894000 usd
CY2022Q4 us-gaap Finite Lived Intangible Assets Net
FiniteLivedIntangibleAssetsNet
995028000 usd
CY2022Q4 us-gaap Goodwill
Goodwill
168300000 usd
CY2022Q4 us-gaap Goodwill
Goodwill
168300000 usd
CY2022Q4 olpx Intangible Assets Gross Including Goodwill
IntangibleAssetsGrossIncludingGoodwill
1312222000 usd
CY2022Q4 us-gaap Finite Lived Intangible Assets Accumulated Amortization
FiniteLivedIntangibleAssetsAccumulatedAmortization
148894000 usd
CY2022Q4 us-gaap Intangible Assets Net Including Goodwill
IntangibleAssetsNetIncludingGoodwill
1163328000 usd
CY2023Q1 us-gaap Accrued Professional Fees Current
AccruedProfessionalFeesCurrent
3911000 usd
CY2022Q4 us-gaap Accrued Professional Fees Current
AccruedProfessionalFeesCurrent
3187000 usd
CY2023Q1 olpx Accrued Legal Settlement Current
AccruedLegalSettlementCurrent
3900000 usd
CY2022Q4 olpx Accrued Legal Settlement Current
AccruedLegalSettlementCurrent
0 usd
CY2023Q1 us-gaap Employee Related Liabilities Current
EmployeeRelatedLiabilitiesCurrent
2792000 usd
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EmployeeRelatedLiabilitiesCurrent
4092000 usd
CY2023Q1 us-gaap Contract With Customer Liability Current
ContractWithCustomerLiabilityCurrent
2230000 usd
CY2022Q4 us-gaap Contract With Customer Liability Current
ContractWithCustomerLiabilityCurrent
2015000 usd
CY2023Q1 olpx Accrued Freight Current
AccruedFreightCurrent
2213000 usd
CY2022Q4 olpx Accrued Freight Current
AccruedFreightCurrent
3283000 usd
CY2023Q1 us-gaap Accrued Advertising Current And Noncurrent
AccruedAdvertisingCurrentAndNoncurrent
2092000 usd
CY2022Q4 us-gaap Accrued Advertising Current And Noncurrent
AccruedAdvertisingCurrentAndNoncurrent
1356000 usd
CY2023Q1 us-gaap Interest Payable Current
InterestPayableCurrent
703000 usd
CY2022Q4 us-gaap Interest Payable Current
InterestPayableCurrent
814000 usd
CY2023Q1 us-gaap Other Accrued Liabilities Current
OtherAccruedLiabilitiesCurrent
2078000 usd
CY2022Q4 us-gaap Other Accrued Liabilities Current
OtherAccruedLiabilitiesCurrent
2360000 usd
CY2023Q1 us-gaap Accrued Liabilities Current
AccruedLiabilitiesCurrent
19919000 usd
CY2022Q4 us-gaap Accrued Liabilities Current
AccruedLiabilitiesCurrent
17107000 usd
CY2023Q1 olpx Accrued Legal Settlement Current
AccruedLegalSettlementCurrent
3900000 usd
CY2023Q1 us-gaap Deferred Finance Costs Net
DeferredFinanceCostsNet
8494000 usd
CY2022Q4 us-gaap Deferred Finance Costs Net
DeferredFinanceCostsNet
8854000 usd
CY2023Q1 us-gaap Long Term Debt
LongTermDebt
659756000 usd
CY2022Q4 us-gaap Long Term Debt
LongTermDebt
662771000 usd
CY2023Q1 us-gaap Long Term Debt Current
LongTermDebtCurrent
6750000 usd
CY2022Q4 us-gaap Long Term Debt Current
LongTermDebtCurrent
8438000 usd
CY2023Q1 us-gaap Long Term Debt Noncurrent
LongTermDebtNoncurrent
653006000 usd
CY2022Q4 us-gaap Long Term Debt Noncurrent
LongTermDebtNoncurrent
654333000 usd
CY2023Q1 us-gaap Interest Expense Debt
InterestExpenseDebt
10543000 usd
CY2022Q1 us-gaap Interest Expense Debt
InterestExpenseDebt
11460000 usd
CY2023Q1 us-gaap Long Term Debt
LongTermDebt
659800000 usd
CY2023Q1 us-gaap Long Term Debt Fair Value
LongTermDebtFairValue
593100000 usd
CY2022Q4 us-gaap Long Term Debt
LongTermDebt
662800000 usd
CY2022Q4 us-gaap Long Term Debt Fair Value
LongTermDebtFairValue
624600000 usd
CY2023Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Non Option Equity Instruments Exercised
ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsExercised
109620 shares
CY2023Q1 us-gaap Shares Paid For Tax Withholding For Share Based Compensation
SharesPaidForTaxWithholdingForShareBasedCompensation
83501 shares
CY2023Q1 us-gaap Stock Issued During Period Shares Stock Options Exercised
StockIssuedDuringPeriodSharesStockOptionsExercised
3659267 shares
CY2022Q1 olpx Deferred Compensation Arrangement With Individual Converted In Period Number Of Units
DeferredCompensationArrangementWithIndividualConvertedInPeriodNumberOfUnits
886950 shares
CY2022Q1 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Non Option Equity Instruments Exercised
ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsExercised
117180 shares
CY2022Q1 us-gaap Shares Paid For Tax Withholding For Share Based Compensation
SharesPaidForTaxWithholdingForShareBasedCompensation
55244 shares
CY2023Q1 us-gaap Loss Contingency Disclosures
LossContingencyDisclosures
CONTINGENCIESFrom time to time, the Company is subject to various legal actions arising in the ordinary course of business. The Company cannot predict with reasonable assurance the outcome of these legal actions brought against us as they are subject to uncertainties. Accordingly, any settlement or resolution in these legal actions may occur and affect the Company’s net income in such period as the settlement or resolution.<div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Pending Legal Proceedings: </span></div><div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">On November 17, 2022, a putative securities class action was filed against the Company and certain of its current and former officers and directors in the United States District Court for the Central District of California, captioned Lilien v. Olaplex Holdings, Inc. et al., No. 2:22-cv-08395. A consolidated complaint was filed on April 28, 2023, which names as additional defendants the underwriters for the Company’s IPO and various stockholders that sold shares of common stock of the Company in the IPO. The action is brought on behalf of a putative class of purchasers of the Company’s common stock in or traceable to the Company’s IPO and asserts claims under Sections 11, 12, and 15 of the Securities Act of 1933. The action seeks certification of the putative class, compensatory damages, attorneys’ fees and costs, and any other relief that the court determines is appropriate. The Company expects the underwriter defendants to notify the Company of their intent to seek indemnification from the Company pursuant to the IPO underwriting agreement regarding the claims asserted in this action. The Company intends to vigorously defend the pending lawsuit.</span></div><div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">On February 9, 2023, twenty-eight plaintiffs filed </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:120%">Albahae, et al. v. Olaplex Holdings, Inc., et al.,</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> No. 2:23-cv-00982, a complaint alleging personal and economic injury and asserting claims for breach of warranty, negligence/gross negligence, products liability, unjust enrichment, and violations of California False Advertising Law and Unfair Competition Law, against the Company and Cosway Company, Inc., the Company’s primary contract manufacturer, in the United States District Court for the Central District of California. On March 2, 2023, the plaintiffs amended the complaint to include seventy-three additional plaintiffs. The plaintiffs allege that certain ingredients used in some Company products have purportedly caused irritation or posed a hazard to consumers, and that the Company engaged in misrepresentation with respect to those products. The plaintiffs seek actual and consequential damages, punitive damages, restitution in the form of disgorgement of profits, attorneys’ fees and costs, and any other relief that the court determines is appropriate. The Company intends to vigorously defend the pending lawsuit. On April 17, 2023, the Company moved to dismiss the plaintiffs’ claims. </span></div><div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Any potential loss associated with these pending legal proceedings is not probable or reasonably estimable at this time.</span></div><div style="margin-top:6pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">As of March 31, 2023 and December 31, 2022, the Company was not subject to any other currently pending legal matters or claims that could have a material adverse effect on its financial position, results of operations, or cash flows should such litigation be resolved unfavorably.</span></div>
CY2023Q1 us-gaap Loss Contingency Number Of Plaintiffs
LossContingencyNumberOfPlaintiffs
28 plaintiff
CY2023Q1 us-gaap Loss Contingency Number Of Plaintiffs
LossContingencyNumberOfPlaintiffs
73 plaintiff
CY2023Q1 us-gaap Net Income Loss
NetIncomeLoss
20964000 usd
CY2022Q1 us-gaap Net Income Loss
NetIncomeLoss
61961000 usd
CY2023Q1 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
651730993 shares
CY2022Q1 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
648813998 shares
CY2023Q1 us-gaap Incremental Common Shares Attributable To Share Based Payment Arrangements
IncrementalCommonSharesAttributableToShareBasedPaymentArrangements
31754189 shares
CY2022Q1 us-gaap Incremental Common Shares Attributable To Share Based Payment Arrangements
IncrementalCommonSharesAttributableToShareBasedPaymentArrangements
44207099 shares
CY2023Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
683485182 shares
CY2022Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
693021097 shares
CY2023Q1 us-gaap Earnings Per Share Basic
EarningsPerShareBasic
0.03
CY2022Q1 us-gaap Earnings Per Share Basic
EarningsPerShareBasic
0.10
CY2023Q1 us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
0.03
CY2022Q1 us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
0.09

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