Exhibit 99.1

Watsco Sets Full-Year and Fourth Quarter Records

for Sales, Earnings, EPS and Cash Flow

 

 

Technology Investments and Culture of Innovation Continue

to Transform the HVAC Distribution Channel

MIAMI, FLORIDA – (BUSINESS WIRE), February 14, 2017 – Watsco, Inc. (NYSE: WSO) reported record results for the fourth quarter and year ended December 31, 2016.

Watsco also announced today that it has raised its ownership stake in Carrier Enterprise Northeast LLC, a joint venture with Carrier, to 80% for approximately $43 million in cash. The incremental investment builds on a transaction completed in November 2016, which increased Watsco’s controlling interest from 60% to 70%. Carrier Enterprise Northeast had sales in 2016 of approximately $500 million from 41 locations in the northeastern United States and 12 locations in Mexico.

2016 Full-Year Results

Key performance metrics:

 

    Earnings per share increased 5% to a record $5.15

 

    Net income increased 6% to a record $183 million

 

    Operating income increased 3% to a record $346 million

 

    Operating income for U.S. locations (87% of sales) increased 6% (operating margins expanded 20 basis-points)

 

    Operating income for international locations (13% of sales) declined 14% (operating margins declined 120 basis-points)

 

    Operating cash flow of $8.52 per share, a 25% increase to a record $278 million

Sales trends:

 

    Sales increased 3% to a record $4.2 billion

 

    HVAC equipment increased 3% (66% of sales), including 4% growth in the U.S.

 

    Other HVAC products increased 1% (29% of sales)

 

    Commercial refrigeration products increased 6% (5% of sales)

Albert H. Nahmad, Watsco’s Chairman and CEO stated: “Watsco produced record results in a year of varying seasonal conditions in certain of our larger U.S. markets and lower international sales and profits due to a stronger U.S. dollar. This performance includes a 17% increase in technology costs for our on-going investments designed to enhance the customer-experience, to optimize the speed and efficiency of our operations and to compete in ways and at a scale that sets us apart in the marketplace.”

Mr. Nahmad added: “Watsco generated record cash flow of $278 million in 2016, or $8.52 per share, which exceeded net income and represents a 25% increase over last year. Along with our continued focus to drive consistently strong cash flow, we improved inventory turns by approximately 30 basis-points through our recent launch of new supply-chain technologies. We are pleased with the early progress for what will be a long-term project to optimize working capital efficiency while enhancing product availability.”

Fourth Quarter Results

Key performance metrics:

 

    Earnings per share increased 8% to a record 81 cents

 

    Net income increased 12% to a record $30 million


The following information was filed by Watsco Inc (WSO) on Tuesday, February 14, 2017 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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