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Watsco EPS Jumps 93% Setting First Quarter Records for Sales,
Operating Profit, Operating Margins and Net Income
Double-Digit Sales Growth, Higher Gross Margins and
Operating Efficiencies Drive Record Performance
Customer-Adoption of Technologies Grows as Business Evolution Continues
MIAMI, FLORIDA (GLOBENEWSWIRE), April 22, 2021 Watsco, Inc. (NYSE: WSO) reported record first quarter operating results, establishing new records for sales, operating income, operating margins, net income and earnings per share (EPS).
Watscos entrepreneurial culture continues to be critically important in response to the varying business conditions in the marketplace. The Company believes the pace of change and innovation is accelerating as adoption of its technology platforms gains further momentum. These platforms are designed to revolutionize the customer experience, providing contractors speed and efficiency as well as supporting their growth in unparalleled ways. In terms of results, new customer acquisition is increasing and attrition rates with existing customers are decreasing, providing meaningful contributions to sales and overall operating performance. The Company continues to make incremental investments to add more capabilities and functionality, to develop and launch new innovations and drive adoption by more customers.
First Quarter Results
Key Performance Metrics
93% increase in EPS to a record $1.39
81% increase in operating income to a record $82 million
270 basis-point operating margin expansion to a record 7.2%
19% gross profit increase to a record $295 million
130 basis-point gross margin increase to a record 25.9%
7% increase in SG&A expenses and a 100 basis-point reduction in SG&A as a percentage of sales
13% sales growth to a record $1.14 billion
14% growth in HVAC equipment (67% of sales), including 18% growth in residential products
11% increase in other HVAC products (29% of sales)
10% increase in commercial refrigeration products (4% of sales)
Albert H. Nahmad, Watscos Chairman & CEO stated: Watsco delivered another record quarter with solid earnings growth and margin expansion. These results are attributable to strong sales growth, a richer sales mix of high-efficiency systems, better selling margins and operating efficiencies. First quarter results also reflect continued investments in products, technology and people to drive sales and innovation throughout our business. As we head into the selling season, we are focused on the same proven fundamentals growth in customer adoption of our industry-leading technologies, driving profitable sales and share gains for our supplier partners. Our first quarter results are a good start in what we expect to be a record year for our company.
Mr. Nahmad added: Sales of residential HVAC systems with energy-efficiency ratings above the minimum energy-standard grew 20% this quarter, a progression that began more than decade ago. We believe that the products we sell play a key role in advancing energy efficiency, providing Watsco the opportunity to be an important contributor to address climate change. There are an estimated 110 million HVAC systems installed in the U.S., many of which operate under old efficiency standards. Replacing the installed base to todays minimum standards can help reduce energy consumption, but even greater conservation and cost savings can be achieved with the higher-efficiency products that we offer. Higher-efficiency HVAC systems also offer healthier and more comfortable indoor living and working environments regardless of the outdoor climate. We are investing capital and leveraging our technology to increase awareness of these benefits among contractors and consumers. As the industry leader, Watsco has an important role to play and we can do so at scale.
The following information was filed by Watsco Inc (WSO) on Thursday, April 22, 2021 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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