Watsco Inc (WSO) SEC Filing 10-Q Quarterly report for the period ending Friday, June 30, 2017

Earnings Press Release
10-Q Quarterly Report
10-Q QoQ Changes
Watsco Inc
Ticker: WSO CIK: 105016

Exhibit 99.1

Watsco Achieves Record Sales, Earnings, Net Income

and EPS During Second Quarter

14% EPS Growth and 40-Basis Point Operating Margin Expansion

MIAMI, FLORIDA – (BUSINESS WIRE), July 25, 2017 – Watsco, Inc. (NYSE: WSO) reported record results for the second quarter and six months ended June 30, 2017. The results reflect continued investment in a variety of technologies to revolutionize Watsco’s customer-experience, create a data-driven culture, to empower more insightful decision-making and enhance productivity and operational efficiency. The Company has also made additional investments in products and people to grow and develop market share for supplier partners.

Second Quarter Results

Key performance metrics:

•

14% increase in earnings per share to a record $2.07

•

10% increase in operating income to a record $129 million

•

40 basis-point expansion in operating margins to 10.1%

•

30 basis-point improvement in gross profit margin

•

10 basis-point reduction in SG&A as a percentage of sales

Sales trends:

•

5% sales growth to a record $1.28 billion

•

7% increase in HVAC equipment (67% of sales), including 8% growth in the U.S.

•

2% increase in other HVAC products (28% of sales)

•

3% growth in commercial refrigeration products (5% of sales)

Albert H. Nahmad, Watsco’s Chairman and CEO stated: “Our second quarter performance produced the highest sales and profits of any quarter in Watsco’s history. Earnings growth and margin expansion were driven by a combination of solid sales growth, improved selling margins and operating efficiencies.”

Mr. Nahmad added: “We believe technology changes progressing in our industry will accelerate and our industry-specific focus, scale and leadership position will serve us well. In time, we believe peers and competitors will realize that Watsco is an attractive succession plan and join forces with us to adapt and evolve in the changing environment. In this regard, we continue to actively seek acquisitions and investments to grow our network and leverage investments across an expanding enterprise.”

First-Half Results

Key performance metrics:

•

10% increase in earnings per share to a record $2.80

•

6% increase in operating income to a record $178 million

•

20 basis-point expansion in operating margins to 8.3%

•

20 basis-point improvement in gross profit margin

•

Flat SG&A as a percentage of sales

Sales trends:

•

4% sales growth to a record $2.15 billion

•

5% increase in HVAC equipment (66% of sales)

•

1% increase in other HVAC products (29% of sales)

•

4% growth in commercial refrigeration products (5% of sales)

The following information was filed by Watsco Inc (WSO) on Tuesday, July 25, 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-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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