Q4 2023 Yunhong Green CTI Ltd Earnings Call

Participants

Frank Cesario; CEO; Yunhong Green CTI Ltd.

Jana Schwan; COO; Yunhong Green CTI Ltd.

Presentation

Operator

Good day, and welcome to the Yunhong Green CTI. first, fourth quarter and year ended December 2023 earnings conference call.(Operator Instructions)
This conference is being recorded today, February 2220 20 for the earnings press release accompanying this conference call was issued last night on the call today is young screen CTI.'s Chief Executive Officer, Frank Cesario, as well as Chief Operating Officer, John Schwarz.
Before we begin, we would want to note that you should read the Forward-Looking Statements in the Company's earnings press release.
During today's call, management will make certain predictive statements that reflect its current views about future performance and financial results, company faces these statements and certain assumptions and expectations on future events that are subject to risks and uncertainties.
The Company's Form 10-K for the year ended December 31st, 2022 lists some of the most important risk factors that could cause actual results to differ from its predictions.
Please note that the Company's earnings press release makes reference to adjusted EBITDA, a non-GAAP financial measure, the Company views adjusted EBITDA as an operating performance measure. And as such, the Company believes that the GAAP financial measure most directly comparable to its net income or loss.
For further information, please refer to the earnings press release and the Company's periodic filings with the Securities and Exchange Commission. At this time, I would like to turn the call over to Frank Cesario, Chief Executive Officer of young hungry CTI. Sir, please go ahead.

Frank Cesario

Greg, you're drilling or Thank you to everyone joining us today. And we finished the year with a strong Valentine's Day shipments now already knee-deep in production for Mother's Day, Father's Day and graduation season.
Our fourth quarter revenue beat the prior year by $1.2 million as we saw improvement in foil balloons, commercial films and balloon inspired guess one trend we've identified is a shift from everyday business to seasonal business.
That's good at this point during the year and some work we will work on before entering the second half, particularly as we look to add new revenue streams to our offering year-to-date sales were $17.8 million in 2023 compared to $18 million during 2022. I'm pleased how we fight back from a third quarter deficit on this metric and that shows up in our margin performance.
Gross margins improved to 18% in 2023 versus 17% the prior year. And that was driven by a strong fourth quarter. More appropriate revenues allowed us to post a 24% gross margin in the fourth quarter of 2023 versus 19% in the prior year. Helium pricing continues to have a slightly negative impact on our marketplace, but much less so than the prior 18 months.
This has been an issue every four years or so and should improve in the what Russian supply becomes available for now is something we watch. We always own our results. And last year we said they simply were not good enough with all the challenges.
I'm pleased to have reported a full year 2023 with a $1.2 million improvement in net income and a $1 million improvement in adjusted EBITDA with earnings per share going from a $0.22 loss to a $0.01 loss. With that said, we are nowhere near where we need to be. We continue to push the envelope on operating efficiently and look to add new revenue streams.
Before we talk about our activity in Dubai, China, I would ask our Chief Operating Officer, John Schwan, to share some of the high-level actions we've implemented that led to a much improved financial performance in 2023. John?

Jana Schwan

Thank you, Frank, and hello, everyone. We have spoken before about the benefits of automation.
We now have two manufacturing lines featuring robotic arm, and it should be no surprise that they are consistently our top performing lines over and above the reduction in labor costs we have started the process to have our third line operational during 2024.
Results are also driven by strong vendor partner relationships, along with processes and people who know what they should be doing and have the experience and culture to raise issues and opportunities as they see. It is an important operating environment that we have developed over the years and it has delivered an incredibly positive impact to the organization as we continue to push the bounds of efficiency.

Frank Cesario

Frank Vojo does talk about the recent bit of news related to our purchasing of a manufacturing facility and who by China. This initiative was not taken lightly and was concluded after careful consideration internally and with our partners in China who have significant resources and experience, especially with new emerging growth opportunities.
As a result of this strategic initiative, we now have more direct manufacturing facilities that can be used in the compostable materials business.
We also have a stronger connection with the rest of the Une home family of companies. We believe this relationship to what should offer dividends in both our traditional business areas as well as the new materials space by issuing up to 5 million shares of our common stock.
We looked to acquire a fully equipped facility with working capital, and we can avail ourselves to exponentially more people who can support and grow our business. We and our broad broader group continue to move through the process of developing and bringing to market our patented compost if you'd like to ask a question, Jenny will open the Q&A line. Thank you.

Question and Answer Session

Operator

Thank you very much, Frank. We are now opening the floor for questions. (Operator Instructions)
Okay, Frank, I'm not seeing anyone in the queue at the moment, and I can certainly let you know if someone jumps in. I can hand back to you for any further comments.

Frank Cesario

You just tell us where that goes. But I appreciate the look it. We're happy to summarize what you can all read in the press release. We know people listen to us and ask us questions later, which is great. We do appreciate your interest in our company, and we look forward to the story that we can talking about 2024. And with that, I wish everyone a good day.

Operator

Thank you very much, Frank, and thank you, Johnna. This does conclude today's conference. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.