STEEL PARTNERS HOLDINGS L.P. (SPLP)·Q3 2024 Earnings Summary

Executive Summary

• Q3 2024 revenue rose 5.7% year over year to $520.4M; net income increased 32.2% to $36.9M; diluted EPS was $1.65; Adjusted EBITDA jumped to $76.0M with a 14.6% margin .
• Strength came from Financial Services (lower credit loss provisions and higher revenue) and Diversified Industrial (higher net sales), partially offset by Energy softness on lower rig hours; Supply Chain (ModusLink) contributed double-digit revenue growth .
• Cash from operations was $101.8M; Adjusted free cash flow declined to $34.3M on higher working capital usage and capex; total debt was $120.2M and total leverage fell to ~1.0x; net cash (as defined) was $5.9M .
• Capital allocation remained active: the company repurchased 13,813 units in the quarter and separately bought 1.27M units from Hale Entities for $63.4M; the board declared a $0.375 preferred distribution payable Dec 15, 2024 .

What Went Well and What Went Wrong

• What Went Well

  • Financial Services profitability inflected: segment profit improved on higher revenue and meaningfully lower provisions for credit losses; segment IBIT was $23.9M vs a loss in Q3 2023; Adjusted EBITDA reached $24.2M .
  • Diversified Industrial posted higher net sales (+6.5% YoY) to $318.6M; segment IBIT more than doubled to $26.3M .
  • Lower corporate interest expense (down 51.6% YoY) helped earnings as average debt outstanding fell; total leverage dropped to ~1.0x .
  • Quote: “We are proud to announce continued record revenue this quarter… These achievements underscore the strength of our strategic initiatives.” — Executive Chairman Warren Lichtenstein .

• What Went Wrong

  • Energy segment revenue decreased 13.9% YoY to $40.3M; segment IBIT fell to $3.5M, driven by lower rig hours .
  • Adjusted free cash flow decreased to $34.3M (from $85.5M) due to higher working capital usage and increased capex; capex rose to $37.3M (7.2% of revenue) .
  • SG&A increased 9.9% YoY, led by Financial Services (higher CRT-related performance fees and personnel costs) and Supply Chain (M&A-related expenses) .

Financial Results

Overall performance – quarterly trend (USD):

Non‑GAAP/CF metrics (USD):

Segment breakdown – Q3 2024 vs Q3 2023 (USD):

Balance sheet and liquidity KPIs:

YoY context (company disclosures):

Notes: Non‑GAAP metrics (Adjusted EBITDA, Adjusted FCF, Net Cash) are as defined by the company; see reconciliations in press releases .

Guidance Changes

The company did not issue quantitative revenue/EPS/margin guidance in the Q3 2024 press release or 10‑Q. Below are relevant updates/disclosures:

Earnings Call Themes & Trends

No public earnings call transcript for Q3 2024 was available; themes below reflect management disclosures across press releases and 10‑Qs.

Management Commentary

• “We are proud to announce continued record revenue this quarter, driven by robust performance across multiple segments… These achievements underscore the strength of our strategic initiatives and our commitment to delivering value for our shareholders as we continue to build momentum across the business.” — Warren Lichtenstein, Executive Chairman .
• Prior quarter (context): “Record revenue… capital allocation has driven free cash flow generation, allowing us to buy back units and pay down over $100 million of debt since the beginning of the year.” — Warren Lichtenstein .

Q&A Highlights

No Q3 2024 earnings call transcript was available, and we did not find a public call/Q&A for the period; consequently, there are no Q&A highlights or guidance clarifications to report for the quarter.

Estimates Context

• Wall Street consensus estimates (S&P Global) for Q3 2024 revenue and EPS were unavailable; we could not retrieve consensus for SPLP and therefore cannot assess beats/misses versus S&P Global consensus for this quarter. Coverage appears limited.

Key Takeaways for Investors

• Quality of earnings improved: revenue +5.7% YoY with a 32.2% net income increase; diluted EPS of $1.65; Adjusted EBITDA of $76.0M (14.6% margin) reflects stronger Financial Services and Diversified Industrial performance .
• Financial Services is the profit swing factor: lower credit loss provisions and higher revenue drove segment IBIT from a loss in Q3’23 to $23.9M in Q3’24; watch CRT balances, fee accruals, and finance interest expense within the segment .
• Energy remains a headwind: lower rig hours pressured revenue and margins; recovery depends on drilling activity and commodity cycles .
• Cash generation solid but FCF pressured: CFO was $101.8M, but Adjusted FCF fell to $34.3M on working capital and capex; capex was $37.3M (7.2% of revenue) .
• Balance sheet flexibility: total leverage ~1.0x with ~$470M of revolver availability supports continued buybacks and selective investments; net cash (company definition) was $5.9M .
• Active capital returns: ongoing buybacks plus the $63.4M Hale Entities unit purchase materially reduced the float; preferred distribution of $0.375 per unit maintained .
• Near‑term setup: absent formal guidance or broad sell‑side coverage, catalysts include continued Financial Services momentum (credit losses, CRT activity), Energy stabilization, and capital deployment; monitor securities MTM volatility quarter to quarter .

Document sources: Company press releases and filings as cited above.