XPEL Reports Record Revenue Growth in Fourth Quarter 2019 of 47.4%; Full Year Revenue Growth of 18.2%

SAN ANTONIO--()--XPEL, Inc. (Nasdaq: XPEL), a global provider of protective films and coatings, announced results for the fourth quarter and year ended December 31, 2019.

Fourth Quarter 2019 Highlights:

  • Revenues increased 47.4% to $39.5 million compared to fourth quarter 2018
  • Net Income of $4.6 million compared to $1.9 million in the same quarter of 2018
  • EBITDA increased to $5.6million compared to $2.9 million in fourth quarter 2018

Full Year 2019 Highlights:

  • Revenues increased 18.2% to $129.9 million compared to full year 2018
  • Gross margin improved to 34.5% compared to 30.4% for full year 2018
  • Earnings per share of $0.51 compared to $0.32 per share in 2018

Ryan Pape, President and Chief Executive Officer of XPEL, commented, “We closed 2019 on a strong note, delivering another quarter of record revenues, enhanced profitability and significant EBITDA growth to cap our best year ever.”

China revenue in Q1 has been significantly negatively impacted by COVID-19. The Company believes the impact of COVID-19 will begin to diminish in the China market in the second quarter. The Company is monitoring the impact of COVID-19 in other markets, including Europe and the United States. To date in the first quarter, the Company has seen strong performance in both the United States and Europe.

For the Quarter Ended December 31, 2019:

Revenues. Revenues increased approximately $12.7 million or 47.4% to $39.5 million as compared to $26.8 million in the prior year.

Gross Margin. Gross margin was 31.5%, essentially flat compared to 31.4% in the fourth quarter of 2018.

Expenses. Selling, general and administrative expenses increased to $7.5 million but declined as a percentage of sales to 18.9% as compared to $5.8 million or 21.8% of sales in the prior year period.

Net income. Net income increased to $4.6 million, or $0.17 per basic and diluted share versus net income of $1.9 million, or $0.07 per basic and diluted share in the fourth quarter of 2018.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) increased to $5.6 million, or 14.1% of sales, as compared to $2.9 million in the prior year1.

For the Year Ended December 31, 2019:

Revenues. Revenues increased approximately $20.0 million or 18.2% to $129.9 million as compared to $109.9 million in the prior year.

Gross Margin. Gross margin was 33.5% versus 30.4% for full year 2018.

Expenses. Selling, general and administrative expenses increased to $26.4 million or 20.3% of sales as compared to $21.6 million or 19.7% of sales in the prior year.

Net income. Net income increased to $14.0 million, or $0.51 per basic and diluted share versus net income of $8.7 million, or $0.32 per basic and diluted share for 2018.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) increased to $18.7 million, or 14.4% of sales, as compared to $13.0 million in the prior year2.

As of December 31, 2019 XPEL had cash and cash equivalents of $11.5 million compared to $4.0 million at December 31, 2018. Total stockholders’ equity at December 31, 2019 was $35.9 million compared to $20.6 million at December 31, 2018.

Conference Call Information

The Company will host a conference call and webcast today, Monday, March 16, 2020 at 11:00 a.m. Eastern Time to discuss the Company’s results for the fourth quarter and full year 2020.

To access the live webcast, please visit the XPEL, Inc. website at www.xpel.com/investor.

To participate in the call by phone, dial (877) 407-8033 approximately five minutes prior to the scheduled start time. International callers please dial (201) 689-8033.

A replay of the teleconference will be available until April 16, 2020 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 33406.

About XPEL, Inc.

XPEL is a leading provider of protective films and coatings, including automotive paint protection film, surface protection film, automotive and commercial/residential window films, and ceramic coatings. With a global footprint, a network of trained installers and proprietary DAP software, XPEL is dedicated to exceeding customer expectations by providing high-quality products, leading customer service, expert technical support and world-class training. XPEL, Inc. is publicly traded on Nasdaq under the symbol “XPEL”.

Safe harbor statement

This release includes forward-looking statements regarding XPEL, Inc. and its business, which may include, but is not limited to, anticipated use of proceeds from capital transactions, expansion into new markets, and execution of the company's growth strategy. Often, but not always, forward-looking statements can be identified by the use of words such as "plans," "is expected," "expects," "scheduled," "intends," "contemplates," "anticipates," "believes," "proposes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may," "could," "would," "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations of the management of XPEL. The forward-looking events and circumstances discussed in this release may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the company, performance and acceptance of the company's products, economic factors, competition, the equity markets generally and many other factors beyond the control of XPEL. Although XPEL has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and XPEL undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

XPEL Inc.

Consolidated Statements of Income

 

 

Three Months Ended

December 31,

Year Ended

December 31,

2019

2018

2019

2018

Revenue

Product revenue

$

34,909,276

 

$

23,027,479

$

112,204,739

$

95,526,350

Service revenue

 

4,586,007

 

 

3,765,400

 

17,728,142

 

14,394,264

Total revenue

 

39,495,283

 

 

26,792,879

 

129,932,881

 

109,920,614

 

Cost of Sales

Cost of product sales

 

25,785,422

 

 

17,624,227

 

82,308,256

 

73,656,389

Cost of service

 

1,252,725

 

 

752,571

 

4,118,366

 

2,827,620

Total cost of sales

 

27,038,147

 

 

18,376,798

 

86,426,622

 

76,484,009

Gross Margin

 

12,457,136

 

 

8,416,081

 

43,506,259

 

33,436,605

 

Operating Expenses

Sales and marketing

 

2,115,397

 

 

1,867,047

 

7,584,377

 

6,802,241

General and administrative

 

5,367,845

 

 

3,970,547

 

18,834,535

 

14,828,361

Total operating expenses

 

7,483,242

 

 

5,837,594

 

26,418,912

 

21,630,602

 

Operating Income

 

4,973,894

 

 

2,578,487

 

17,087,347

 

11,806,003

 

Interest expense

 

15,015

 

 

33,004

 

96,646

 

168,389

Foreign currency exchange (gain) loss

 

(111,586

)

 

47,634

 

40,273

 

156,309

 

Income before income taxes

 

5,070,465

 

 

2,497,849

 

16,950,428

 

11,481,305

Income tax expense

 

451,991

 

 

600,477

 

2,955,356

 

2,760,073

Net income

 

4,618,474

 

 

1,897,372

 

13,995,072

 

8,721,232

Income attributed to non-controlling interest

 

8,136

 

 

3,498

 

17,447

 

8,698

Net income attributable to stockholders of the Company

$

4,610,338

 

$

1,893,874

$

13,977,625

$

8,712,534

 

Earnings per share attributable stockholders of the Company

Basic and diluted

$

0.17

 

$

0.07

$

0.51

$

0.32

Weighted Average Number of Common Shares

Basic and diluted

 

27,612,597

 

 

 

27,612,597

 

 

27,612,597

 

 

27,612,597

 

XPEL Inc.

Consolidated Balance Sheets

December 31, 2019

December 31, 2018

Assets

Current

Cash and cash equivalents

$

11,500,973

 

$

3,971,226

 

Accounts receivable, net

 

7,154,084

 

 

5,554,313

 

Inventory, net

 

15,141,153

 

 

10,799,611

 

Prepaid expenses and other current assets

 

2,391,340

 

 

706,718

 

Income tax receivable

 

93,150

 

 

 

Total current assets

 

36,280,700

 

 

21,031,868

 

Property and equipment, net

 

4,014,653

 

 

3,384,206

 

Right-of-Use lease assets

 

5,079,110

 

 

Intangible assets, net

 

3,820,460

 

 

3,804,026

 

Goodwill

 

2,406,512

 

 

2,322,788

 

Total assets

$

51,601,435

 

$

30,542,888

 

Liabilities

Current

Current portion of notes payable

$

462,226

 

$

853,150

 

Current portion lease liabilities

 

1,126,701

 

 

Accounts payable and accrued liabilities

 

10,197,353

 

 

6,292,093

 

Income tax payable

 

 

1,337,599

 

Total current liabilities

 

11,786,280

 

 

8,482,842

 

Deferred tax liability, net

 

604,715

 

 

478,864

 

Non-current portion of lease liabilities

 

4,009,949

 

 

Non-current portion of notes payable

 

307,281

 

 

968,237

 

Total liabilities

 

16,708,225

 

 

9,929,943

 

Stockholders’ equity

Preferred stock, $0.001 par value; authorized 10,000,000; none
issued and outstanding

 

 

Common stock, $0.001 par value; 100,000,000 shares authorized;
27,612,597 issued and outstanding

 

27,613

 

 

27,613

 

Additional paid-in-capital

 

11,348,163

 

 

11,348,163

 

Accumulated other comprehensive loss

 

(908,764

)

 

(1,190,055

)

Retained earnings

 

24,594,878

 

 

10,617,253

 

 

35,061,890

 

 

20,802,974

 

Non-controlling interest

 

(168,680

)

 

(190,029

)

Total stockholders’ equity

 

34,893,210

 

 

20,612,945

 

Total liabilities and stockholders’ equity

$

51,601,435

 

$

30,542,888

 

Reconciliation of Non-GAAP Financial Measure

EBITDA is a non-GAAP financial measure. EBITDA is defined as net income (loss) plus interest expense, net, plus income tax expense plus depreciation expense and amortization expense. EBITDA should be considered in addition to, not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. It is not a measurement of our financial performance under GAAP and should not be considered as alternatives to revenue or net income, as applicable, or any other performance measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other businesses. EBITDA has limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our operating results as reported under GAAP.

EBITDA does not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of ongoing operations and other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure.

EBITDA Reconciliation

Three Months Ended December 31,

Year Ended December 31,

2019

2018

2019

2018

Net Income

$

4,618,474

$

1,897,372

$

13,995,072

$

8,721,232

Interest

 

15,015

 

33,004

 

96,646

 

168,389

Taxes

 

451,991

 

600,477

 

2,955,356

 

2,760,073

Depreciation

 

260,533

 

196,604

 

915,918

 

735,983

Amortization

 

210,151

 

170,126

 

781,105

 

642,801

EBITDA

$

5,556,164

$

2,897,583

$

18,744,097

$

13,028,478


1See reconciliation of non-GAAP financial measures below.
2See reconciliation of non-GAAP financial measures below.

Contacts

Investor Relations:
John Nesbett/Jennifer Belodeau
IMS Investor Relations
Phone: (203) 972-9200
Email: jnesbett@institutionalms.com

Contacts

Investor Relations:
John Nesbett/Jennifer Belodeau
IMS Investor Relations
Phone: (203) 972-9200
Email: jnesbett@institutionalms.com