POOL - Earnings NEWS on a Long Term High Revenue and EPS growth stock.
SCP Pool Corporation Reports Twelfth Consecutive Year of Record Results; 26% Earnings Per Share Increase for the Year
COVINGTON, La.--(Business Wire)--Feb. 16, 2006--
SCP Pool Corporation (the "Company" or "POOL")
(Nasdaq:POOL) today reported record net sales and net income for
2005.
Earnings per share for 2005 increased 26% to $1.50 per diluted
share on net income of $83.6 million, compared to $1.19 per diluted
share on net income of $66.9 million last year.
Net sales for the year ended December 31, 2005 increased $241.8
million, or 18%, to $1.55 billion, compared to $1.31 billion in 2004.
Base business sales growth of 14% contributed $180.4 million to the
increase due primarily to the growth in the installed base of swimming
pools, POOL's execution of its sales and service programs and 32%
growth in complementary product sales. The remaining increase in net
sales is attributable to acquired service centers, including the
Horizon branches acquired in October 2005.
Gross profit for the year ended December 31, 2005 increased $61.6
million, or 17%, to $432.4 million from $370.8 million in 2004. This
increase is primarily due to the increase in net sales. Gross profit
as a percentage of net sales (gross margin) decreased 40 basis points
to 27.9% in 2005 from 28.3% in 2004. The decline in gross margin is
attributable to the divestiture of POOL's North American manufacturing
assets and unprecedented levels of price increases, which have been
generally passed on, but on a dollar per unit basis instead of on a
percentage basis.
Operating expenses in 2005 increased $35.0 million, or 14%, to
$292.2 million from $257.2 million in 2004. Operating expenses as a
percentage of net sales decreased to 18.8% in 2005 from 19.6% in 2004.
Operating income increased $26.7 million, or 24%, to $140.3
million in 2005 from $113.6 million in 2004. Operating income as a
percentage of net sales (operating margin) increased 30 basis points
to 9.0% in 2005 from 8.7% in 2004. EBITDA (as defined in the addendum)
increased 23% to $152.3 million in 2005 from $123.9 million in 2004.
Cash provided by operations was $38.1 million, compared to cash
from operations of $56.4 million in 2004. The decrease in 2005 cash
from operations is the result of the Company's pre-price increase
purchases and participation in vendor payment incentives for early buy
purchases received and paid for in the fourth quarter, partially
offset by the deferral of third and fourth quarter 2005 estimated
federal tax payments and higher net income. The Company expects that
the pre-price increase purchases will mitigate the potential adverse
gross margin impact of price increases through the supply chain.
"Building on our core strengths and continually executing our
strategies for profitable growth have resulted in our twelfth
consecutive record-breaking year. With strong organic growth at the
sales, gross profit and operating income levels in 2005, including a
solid fourth quarter performance, we are very optimistic about 2006.
We believe that 2006 earnings per share will be in the range of $1.70
to $1.75 per diluted share, including the impact of expensing stock
options," commented Manuel Perez de la Mesa, President and CEO.
In the fourth quarter of 2005, net sales increased $89.9 million,
or 43%, to $299.8 million, compared to $209.9 million in the
comparable 2004 period. This is due to base business sales growth of
20%, as well as the Horizon acquisition which accounted for a portion
of the increase in net sales in the fourth quarter. Gross profit
margin increased 90 basis points to 27.8% in the fourth quarter of
2005 from 26.9% for the same period last year. Operating income for
the fourth quarter was $3.8 million, or 1.3% of net sales, compared to
an operating loss of $3.6 million, or 1.7% of net sales in the same
period last year. Additionally, mild weather provided a positive
impact on results for the quarter. Earnings per share for the fourth
quarter of 2005 were $0.00 on net income of $0.1 million, compared to
a loss of $0.05 per share on a net loss of $2.7 million in the fourth
quarter of 2004.
POOL also announced today that its Board of Directors has declared
its regular quarterly cash dividend of $0.09 per share. The dividend
will be payable on March 13, 2006 to holders of record on February 27,
2006.
At December 31, 2005, 201 service centers were included in the
base business calculations, and 45 service centers, including the 40
Horizon service centers, were excluded because they were acquired or
opened in new markets within the last 15 months.
SCP Pool Corporation is the largest wholesale distributor of
swimming pool and related backyard products. Currently, POOL operates
over 240 service centers in North America and Europe, through which it
distributes more than 100,000 national brand and private label
products to roughly 68,000 wholesale customers. For more information
about POOL, please visit www.poolcorp.com.
SCP Pool Corporation, Covington
Craig K. Hubbard, 985-801-5117
craig.hubbard@poolcorp.com
Copyright Business Wire 2006
16Feb06 13:00 GMT
Symbols:
de;SP1 us;POOL
