a.k.a. Brands Holding Corp.

Welcome to AKA Brands Holding Corporation fourth quarter and fiscal 2024 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this call is being recorded. It is now my pleasure to introduce Emily Schwartz. Thank you. You may begin.

Good afternoon. Thank you for joining AKA Brands to discuss our fourth quarter and fiscal 2024 results released this afternoon, which can be found on our website at ir.aka-brands.com. With me on the call today are Kiran Long, Chief Executive Officer, and Kevin Grant, Chief Financial Officer. Before we get started, I'd like to remind you of the company's safe harbor language. Management may make forward-looking statements which refer to expectations, projections, and other characterizations of future events, including guidance and underlying assumptions. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed. For a further discussion of risks related to our business, please see our filings with the SEC. Please note, we assume no obligation to update any such forward-looking statements. This call will also contain non-GAAP financial measures, such as adjusted EBITDA and adjusted EBITDA emergence. Reconciliations of these non-GAAP measures to the most comparable GAAP measures are included in our lease, furnished to the SEC, and available on our website. With that, I'll turn the call over to Ciarán.

Good afternoon, everyone, and thanks for joining us. This marks my first call as the permanent CEO, and I'm thrilled to build on the foundation we've established over the past few years and need AKA brands through this next chapter of growth. I'd also like to introduce Kevin Grant, our Chief Financial Officer, who was appointed to the role in the first week of January. Prior to becoming the CFO, Kevin was the company's controller and a key senior leader at AKA Brands since April 2021. Kevin joined AKA from Walmart, where he spent seven years in senior finance positions. And prior to that, he spent 11 years at Ernst & Young. I'm excited to have him on the call today. 2024 was an exciting and pivotal year for AKA Brands. marking a fundamental shift in our trajectory. I'm particularly proud that we delivered results ahead of our expectations, which is a testament to our team's ability to execute at the highest levels. Thank you to our team for their hard work and dedication building next-generation fashion brands, as well as their consistent innovation and enthusiasm towards serving our customers. Before I go through the results, I'd like to highlight some key achievements from the past year. In 2024, we achieved a significant milestone by stabilizing the business and returning to growth. We delivered $575 million in net sales, representing a 5.2% increase over the prior year. In the U.S., which is our largest market, we delivered an impressive 17% net sales growth, underscoring the strength of our brand and the long runway of opportunity ahead in the region. We successfully attracted new customers while strengthening our bond with existing ones, resulting in an impressive 9% growth in our trailing 12-month active customer base, surpassing 4 million customers. We expanded our omnichannel initiatives to drive profitable growth and enhance brand awareness. We opened five Princess Polly stores throughout California, Arizona, and Boston, and our women's brands furthered their wholesale tests with leading retailers such as Nordstrom. We enhanced our assortment with fresh, high-quality merchandise resulting in stronger full-price sales and a 200 basis point improvement in gross margin to 57%. And lastly, given the strength and flexibility of our business model, we delivered 23.3 million of adjusted EBITDA, which represented significant year-over-year growth of 69%. Our strong financial performance and ability to execute our strategy gives me great confidence in AKA Brand's many profitable growth opportunities ahead. As we look at 2025, we are steadfast in our focus on growing our brands and enhancing our overall profitability. Our momentum continues with the quarter-to-date net sales growth consistent with our Q1 outlook of 4% to 6%. We're confident in our full-year sales outlook of 600 to 610 million, representing growth of 5% at the midpoint and adjusted EBITDA of 27.5 to 29.5 million for the year. Building on the success of last year, we remain focused on three key priorities. First, we will attract and retain customers through our direct-to-consumer channels. Our brands are early on in their journey, and we believe we have significant opportunity to grow awareness of our brands. This includes the evolution of our test and repeat merchandising model and delivering on our promise of curating new, on-trend, exclusive fashion to customers weekly. We'll also leverage differentiated and innovative strategies across multiple marketing platforms to deepen our direct connection with customers. Second, building upon our early success, we will expand our reach and total addressable market through physical retail and growing our wholesale partnerships. As you saw in our press release this afternoon, we will open seven new Princess Polly stores in 2025, with our first store in New York City slated to open next week. We're also expanding our wholesale presence. Princess Polly and Petal & Puck will launch across Nordstrom's entire store fleet this month. And third, we remain committed to streamlining our operations and strengthening our financial foundation. As part of this, we will continue to harness the power of our flexible technology ecosystem, which allows us to explore new AI capabilities to deliver great customer experience and drive operational excellence with minimal capital investment and resources. In combination with our comprehensive set of customer data, we will leverage AI-driven solutions to personalize customer journeys, predict shopping behaviors, optimize marketing, streamline inventory planning, and operational workflows. Now, let me share some recent highlights from our brands as well as growth drivers for 2025. Starting with Princess Polly, our largest brand that's well known for its trend-driven designs and authentic connection with its customers. Princess Polly has climbed in popularity in the US over the past several years as an online-only brand, and I'm pleased that the brand continues to resonate with its customers through innovative merchandising and marketing strategies. Anchored on our data-driven test-and-repeat merchandising models, Princess Polly consistently drops new collections and styles to stay ahead of the trends and capitalize on big moments, such as upcoming festival, prom, and graduation collections, and an exclusive edit with Ashton Earl, which launched earlier this week. Core to the Princess Polly brand is its next-generation marketing approach, which blends traditional and cutting-edge marketing initiatives to foster a deep connection with its customer. In 2025, as part of our strategy to attract and retain customers, Princess Polly will lead with its influencer strategy on social media, while also diversifying to over 30 different marketing platforms. including WeChat, Netflix, and out-of-home billboards to build upon the momentum and brand affinity. Though Princess Polly remains primarily a digital first fashion brand, the brand is expanding its footprint to remain at the forefront of the next generation of retail. In September of 2023, Princess Polly took a significant step by launching the brand into physical retail with its first store in Los Angeles. The in-store customer response exceeded our expectation validated our omnichannel vision, and led Princess Polly to opening five more stores in 2024. The stores drive revenue and profitability. However, their strategic value lies in expanding brand awareness, acquiring new customers, and creating deeper, more meaningful connections with our existing customers through enhanced touch points and physical experiences. More than 30% of customers shopping in our stores are new to Princess Polly on their first visit. And importantly, While it's still early days, we've observed an incremental lift in our online business in the surrounding radius when a store opens, confirming our thesis that we're expanding our market share with each new location. We are excited to announce that we will be opening our latest physical expression of the Princess Polly brand in Seoul, New York City next week. The opening will be supported by an engaging series of launch celebrations featuring in-store grand opening events and citywide activations. We encourage those of you in New York to come out and experience the brand firsthand. Building on the store momentum, I'm excited to announce that Princess Polly will open seven new stores across the US in 2025, which would bring the total number of stores to 13 by year end. In addition to New York City, Princess Polly will unveil stores in top shopping destinations across the country, including New York, Florida, California, Ohio, and Pennsylvania. From a timing perspective, four stores will open in the first half of the year with the remaining stores slated to open in the back half. Building upon its omnichannel model, Princess Polly is also expanding its reach through strategic partnerships with leading retailers. Following a highly successful pilot across 20 Nordstrom locations in the fourth quarter, Princess Polly will launch new styles across all Nordstrom stores nationwide in the first quarter. further validating that broader consumer exposure consistently drives strong demand for our brands. Princess Polly also recently launched over 70 styles on ASOS.com in the UK, establishing the groundwork for future global expansion. Petal & Pulp, our other women's brand, appeals to females in their 20s and 30s with its stylish, feminine designs that make fashion accessible and empowering for life's biggest moments. Building on its digital foundations, Petal & Pop is also strategically expanding into new channels, driving brand awareness while achieving strong performance across all partnership launches. As we announced in January, Petal & Pop had a very successful test across Nordstrom's website and half of their store fleet in 2024, and will now be featured in all Nordstrom stores later this month. In addition to its omnichannel expansion, Petal & Pop continues driving customer engagement through multi-channel marketing strategies, leveraging influencer partnerships, social media campaigns, in-person events, and out-of-home advertising, including high-impact billboards. The brand is equally focused on strategically expanding its assortment, highlighting key trends such as everyday basics, elevated floral prints, and this season's trending colors. Petal & Pop also continues to strengthen its exclusive style portfolio capturing additional share of wallet with its second wedding guest, Modern Romance Collection, which exceeded performance expectations and deeply resonated with customers during the collection's debut last spring. And more confident than ever, then Petal & Pop is well positioned to capitalize on significant untapped market potential. Shifting to our streetwear brands, we've made great progress over the last 18 months optimizing Culture Kings operations across both regions. And the results are very encouraging. We've added strategic hires in the beginning of 2025, including a new president of Australia and a global head of in-house brands, who brings valuable experience to both our US and Australian operations, positioning Culture Kings for long-term growth and innovation. Culture Kings stands apart in the streetwear landscape by leading with its in-house designed apparel, positioning the brand for sustained long-term growth. Culture Kings in-house brands, including sought-after labels like Minimal, Loiter, Carre, and St. Morta, consistently rank among top sellers both online and at the Las Vegas flagship store. To complete the streetwear outfit and enhance its market credibility, Culture Kings complements these in-house brands with exclusive footwear, headwear, and accessories from premium third-party brands, including industry titans like New Era, Mitchell & Ness, and New Balance. In the back half of last year, Culture Kings began narrowing its focus on their top in-house and third-party brands that really moved the needle. This included shifting our in-house brands to a test and repeat merchandising approach, which creates more fashion newness and reduces inventory risk. Culture Kings in-house brand, Loiter, is leading this merchandising transition and showcasing the effectiveness of the model. In the fourth quarter, Reuter put up another quarter of triple-digit revenue growth with gross profit dollars growing even faster year over year. There is nothing quite like the immersive experience of the Culture Kings Las Vegas flagship store, and we're actively looking for our next Culture Kings store location in the U.S., which will be smaller than our Vegas store while retaining key immersive elements such as the half-basketball court and hat walls. The immersive store and retail attainment atmosphere are core to the Culture King's marketing strategy of creating unforgettable moments around product launches, in-person experiences, and tentpole moments that resonate deeply with its customer base. Before I pass it to Kevin, I'd like to reiterate my thanks to our incredible team for delivering a great year. Our portfolio consists of young brands still early in their growth trajectories with substantial global potential ahead. I'm confident that we have the right strategic initiatives in place and complete alignment across our teams to drive another year of strong performance in 2025. With that, I'll turn it over to Kevin to walk you through the financials.