WSTG...STRONG EARNINGS REPORT and forward guidance...
Wayside Technology Group Reports Fourth Quarter and Full Year 2021 Results
March 02 2022
Wayside Technology Group, Inc. (NASDAQ: WSTG) (“Wayside” or the “Company”), a value-added global IT channel company providing innovative sales and distribution solutions for emerging technology vendors, is reporting results for the fourth quarter and full year ended December 31, 2021.
Fourth Quarter 2021 Highlights vs. Same Year-Ago Quarter
Adjusted gross billings (a non-GAAP financial measure defined below) increased 16% to $262.1 million.
Net sales increased 6% to $75.5 million.
Gross profit increased 20% to $12.6 million.
Net income increased 36% to $3.4 million or $0.78 per diluted share.
Adjusted EBITDA (a non-GAAP financial measure defined below) increased 17% to $5.1 million.
Full Year 2021 Highlights vs. 2020:
Adjusted gross billings increased 28% to $935.0 million.
Net sales increased 12% to $282.6 million.
Gross profit increased 38% to $45.7 million.
Net income grew 2x to $9.2 million or $2.09 per diluted share.
Adjusted EBITDA increased 36% to $15.5 million.
Management Commentary
“2021 was a record year for Wayside, highlighted by strong results across all of our key financial metrics,” said CEO Dale Foster. “This was driven by the execution of our core strategy – generating organic growth with existing vendors, adding new emerging vendors to our line card, and delivering on our acquisition objectives, including the integration of CDF Group Limited (“CDF”). Q4 2021 marked the one-year anniversary of our CDF acquisition, which has been an excellent addition to our organization. CDF realized 17% gross profit growth in 2021, in addition to solid organic growth from Wayside, and we expect additional synergies across our platforms in 2022 that will further improve our operating leverage.
“2022 is already off to a strong year as we are ramping several new vendor additions to our line card, including IRONSCALES, Sonatype and Vultr. Further, in January we became an approved vendor for the National Cooperative Purchasing Alliance (NCPA). This partnership allows us to leverage NCPA’s cooperative purchasing contracts and nationwide agency network to deliver best-in-class security and IT solutions across multiple sectors, including government, healthcare and education.
“Looking ahead to the rest of 2022, we expect to generate another record year of results and will remain steadfast in executing our core growth initiatives. We have a strong foundation in place to support the emerging vendors in our network and pipeline across the globe, and we look forward to continuing to deliver value to our customers, partners and shareholders alike.”
Dividend
Subsequent to the quarter end, on March 1, 2022, Wayside’s board of directors declared a quarterly dividend of $0.17 per share of its common stock payable on March 18, 2022 to shareholders of record on March 14, 2022.
Fourth Quarter 2021 Financial Results
Adjusted gross billings in the fourth quarter of 2021 increased 16% to $262.1 million compared to $226.4 million for the same period in 2020. This reflects both strong organic growth from new and existing vendors as well as the benefit from the acquisition of CDF, which occurred in November 2020. In addition, Net sales in the fourth quarter of 2021 increased 6% to $75.5 million compared to $71.4 million for the same period in 2020.
Gross profit in the fourth quarter of 2021 increased 20% to $12.6 million compared to $10.5 million for the same period in 2020. The increase in gross profit was driven by new and existing vendors, certain customers that did not fully utilize discounts for early pay, as well as contribution from CDF.
Total selling, general, and administrative (“SG&A”) expenses in the fourth quarter of 2021 were $8.2 million compared to $7.7 million for the same period in 2020. SG&A as a percentage of adjusted gross billings was 3.1% for the fourth quarter of 2021 compared to 3.4% for same period in 2020.
Net income in the fourth quarter of 2021 increased 36% to $3.4 million or $0.78 per diluted share, compared to $2.5 million or $0.58 per diluted share for the same period in 2020.
Adjusted EBITDA in the fourth quarter of 2021 increased 17% to $5.1 million compared to $4.4 million for the same period in 2020. The increase was driven by organic growth and the acquisition of CDF.
Effective margin, which is defined as adjusted EBITDA as a percentage of gross profit, was 40.7% in the fourth quarter of 2021 compared to 41.4% for the same period in 2020.
Cash and cash equivalents were $29.3 million on December 31, 2021, compared to $29.3 million on December 31, 2020, while working capital increased by $8.6 million during this period. The Company remained debt free on December 31, 2021, with no borrowings outstanding under either its $20 million or £8 million credit facilities.
Fourth quarter and full year financial results in 2020 partially include operations from the acquisition of CDF on November 6, 2020.
Funny what money can do...$$$
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2morrowsGains is opinion only and should not to be taken as investment advice.
