AMCON Distributing Company Reports Results for the Quarter Ended December 31, 2023
- Fully diluted earnings per share of $1.78
- Net income available to common shareholders of $1.1 million
- Actively pursuing strategic acquisition opportunities
- Investing heavily in foodservice and technology platforms
- Shareholders' equity of $106.9 million as of December 31, 2023
- New 175,000 square foot distribution facility in Springfield, Missouri became partially operational in the first fiscal quarter
- Challenges due to labor shortage, supply chain issues, inflation, energy price volatility, and rising interest rates
Insights
AMCON's report of a fully diluted earnings per share (EPS) of $1.78 and net income of $1.1 million for the first fiscal quarter is a critical metric for evaluating the company's profitability and financial health. This EPS figure can be compared to past performance and industry benchmarks to gauge the company's operational efficiency and growth trajectory. The strong liquidity position and shareholders' equity of $106.9 million suggest a robust balance sheet, which may provide the company with the flexibility to navigate market volatility and invest in growth opportunities.
However, the challenges highlighted such as labor shortages, supply chain disruptions, inflation and volatile energy prices are systemic issues that could affect future margins and operational costs. Strategic acquisitions in the Convenience Distributor and Foodservice sectors indicate a forward-looking growth strategy, which could diversify AMCON's revenue streams but also come with integration risks. Investors would need to monitor how these expansions align with the company's core competencies and affect its long-term profitability.
The emphasis on customer-centric philosophy and the investment in foodservice and technology platforms suggest that AMCON is adapting to evolving market demands and consumer behaviors. The partially operational new distribution facility in Springfield, Missouri, represents an expansion of logistical capabilities that could enhance distribution efficiency and customer service. The potential for geographic expansion to support customer growth initiatives could open up new markets and increase market share.
However, the retail landscape is highly competitive, particularly in the convenience sector. AMCON's ability to maintain a timely flow of goods and services in light of supply chain issues is critical. The company's performance in this regard could significantly impact its reputation and customer loyalty. Additionally, the expansion of the Healthy Edge Retail Group indicates an investment in the growing health and wellness trend, which may cater to a niche but rapidly expanding customer base.
The mention of rising interest rates is noteworthy as it can increase borrowing costs, potentially dampening expansion plans and consumer spending. AMCON's strong liquidity position may mitigate some of the immediate risks, but the broader economic impact of interest rate hikes on consumer behavior and business investment cannot be ignored. The labor shortage is another macroeconomic factor that could lead to wage inflation, affecting operating costs and profit margins.
Given the current economic climate, AMCON's strategic decisions to pursue acquisitions and invest in technological infrastructure must be balanced against the potential for economic downturns. The company's proactive approach to these challenges, if managed effectively, could position it well against competitors who may be slower to adapt to such economic pressures.
“We are pleased with our first quarter 2024 results. Our business continues to encounter numerous operating challenges resulting from a labor shortage, supply chain issues, inflation, volatility in energy prices, and the impact of rising interest rates. The customer-centric philosophy AMCON embraces has enabled our management team to work closely with our customers to ensure a timely flow of goods and services,” said Christopher H. Atayan, AMCON’s Chairman and Chief Executive Officer. He further noted, “We are actively pursuing strategic acquisition opportunities in the Convenience Distributor and Foodservice sectors.”
“We are investing heavily in our foodservice and technology platforms and associated staffing for these strategic focus areas,” said Andrew C. Plummer, AMCON’s President and Chief Operating Officer. Mr. Plummer added, “We are also looking to expand our geographic reach to better serve our customers as they grow their store footprints.”
Charles J. Schmaderer, AMCON’s Chief Financial Officer said, “At December 31, 2023, our shareholders’ equity was
AMCON, and its subsidiaries Team Sledd, LLC and Henry’s Foods, Inc., is a leading Convenience Distributor of consumer products, including beverages, candy, tobacco, groceries, foodservice, frozen and refrigerated foods, automotive supplies and health and beauty care products with distribution centers in
This news release contains forward-looking statements that are subject to risks and uncertainties and which reflect management's current beliefs and estimates of future economic circumstances, industry conditions, Company performance and financial results. A number of factors could affect the future results of the Company and could cause those results to differ materially from those expressed in the Company's forward-looking statements including, without limitation, availability of sufficient cash resources to conduct its business and meet its capital expenditures needs and the other factors described under Item 1.A. of the Company’s Annual Report on Form 10-K. Moreover, past financial performance should not be considered a reliable indicator of future performance. Accordingly, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all such forward-looking statements.
Visit AMCON Distributing Company's web site at: www.amcon.com
AMCON Distributing Company and Subsidiaries |
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Condensed Consolidated Balance Sheets |
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December 31, 2023 and September 30, 2023 |
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December |
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September |
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2023 |
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2023 |
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(Unaudited) |
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ASSETS |
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Current assets: |
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|
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||
Cash |
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|
$ |
996,695 |
|
|
$ |
790,931 |
|
Accounts receivable, less allowance for credit losses of |
|
|
|
68,822,905 |
|
|
|
70,878,420 |
|
Inventories, net |
|
|
|
158,167,362 |
|
|
|
158,582,816 |
|
Income taxes receivable |
|
|
|
1,517,687 |
|
|
|
1,854,484 |
|
Prepaid expenses and other current assets |
|
|
|
13,926,848 |
|
|
|
13,564,056 |
|
Total current assets |
|
|
|
243,431,497 |
|
|
|
245,670,707 |
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|
|
|
|
|
|
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||
Property and equipment, net |
|
|
|
81,730,692 |
|
|
|
80,607,451 |
|
Operating lease right-of-use assets, net |
|
|
|
23,345,042 |
|
|
|
23,173,287 |
|
Goodwill |
|
|
|
5,778,325 |
|
|
|
5,778,325 |
|
Other intangible assets, net |
|
|
|
5,150,510 |
|
|
|
5,284,935 |
|
Other assets |
|
|
|
2,936,861 |
|
|
|
2,914,495 |
|
Total assets |
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|
$ |
362,372,927 |
|
|
$ |
363,429,200 |
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|
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||
LIABILITIES AND SHAREHOLDERS’ EQUITY |
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Current liabilities: |
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||
Accounts payable |
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|
$ |
44,059,086 |
|
|
$ |
43,099,326 |
|
Accrued expenses |
|
|
|
13,788,439 |
|
|
|
14,922,279 |
|
Accrued wages, salaries and bonuses |
|
|
|
5,160,357 |
|
|
|
8,886,529 |
|
Current operating lease liabilities |
|
|
|
6,019,749 |
|
|
|
6,063,048 |
|
Current maturities of long-term debt |
|
|
|
1,972,096 |
|
|
|
1,955,065 |
|
Current mandatorily redeemable non-controlling interest |
|
|
|
1,757,236 |
|
|
|
1,703,604 |
|
Total current liabilities |
|
|
|
72,756,963 |
|
|
|
76,629,851 |
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|
|
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Credit facilities |
|
|
|
140,073,953 |
|
|
|
140,437,989 |
|
Deferred income tax liability, net |
|
|
|
5,385,163 |
|
|
|
4,917,960 |
|
Long-term operating lease liabilities |
|
|
|
17,646,454 |
|
|
|
17,408,758 |
|
Long-term debt, less current maturities |
|
|
|
11,167,890 |
|
|
|
11,675,439 |
|
Mandatorily redeemable non-controlling interest, less current portion |
|
|
|
7,933,339 |
|
|
|
7,787,227 |
|
Other long-term liabilities |
|
|
|
523,157 |
|
|
|
402,882 |
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|
|
|
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|
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Shareholders’ equity: |
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Preferred stock, |
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|
— |
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|
|
— |
|
Common stock, |
|
|
|
9,648 |
|
|
|
9,431 |
|
Additional paid-in capital |
|
|
|
32,521,091 |
|
|
|
30,585,388 |
|
Retained earnings |
|
|
|
105,627,432 |
|
|
|
104,846,438 |
|
Treasury stock at cost |
|
|
|
(31,272,163 |
) |
|
|
(31,272,163 |
) |
Total shareholders’ equity |
|
|
|
106,886,008 |
|
|
|
104,169,094 |
|
Total liabilities and shareholders’ equity |
|
|
$ |
362,372,927 |
|
|
$ |
363,429,200 |
|
AMCON Distributing Company and Subsidiaries |
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Condensed Consolidated Unaudited Statements of Operations |
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for the three months ended December 31, 2023 and 2022 |
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For the three months ended December |
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|
2023 |
|
2022 |
||||
Sales (including excise taxes of |
|
$ |
644,959,073 |
|
|
$ |
565,989,507 |
|
Cost of sales |
|
|
601,658,151 |
|
|
|
531,019,924 |
|
Gross profit |
|
|
43,300,922 |
|
|
|
34,969,583 |
|
Selling, general and administrative expenses |
|
|
37,258,677 |
|
|
|
28,379,186 |
|
Depreciation and amortization |
|
|
2,219,168 |
|
|
|
1,070,886 |
|
|
|
|
39,477,845 |
|
|
|
29,450,072 |
|
Operating income |
|
|
3,823,077 |
|
|
|
5,519,511 |
|
|
|
|
|
|
|
|
||
Other expense (income): |
|
|
|
|
|
|
||
Interest expense |
|
|
2,311,513 |
|
|
|
1,694,158 |
|
Change in fair value of mandatorily redeemable non-controlling interest |
|
|
199,744 |
|
|
|
(54,916 |
) |
Other (income), net |
|
|
(563,141 |
) |
|
|
(53,532 |
) |
|
|
|
1,948,116 |
|
|
|
1,585,710 |
|
Income from operations before income taxes |
|
|
1,874,961 |
|
|
|
3,933,801 |
|
Income tax expense |
|
|
804,000 |
|
|
|
1,304,800 |
|
Net income available to common shareholders |
|
$ |
1,070,961 |
|
|
$ |
2,629,001 |
|
|
|
|
|
|
|
|
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Basic earnings per share available to common shareholders |
|
$ |
1.80 |
|
|
$ |
4.52 |
|
Diluted earnings per share available to common shareholders |
|
$ |
1.78 |
|
|
$ |
4.46 |
|
|
|
|
|
|
|
|
||
Basic weighted average shares outstanding |
|
|
595,623 |
|
|
|
581,612 |
|
Diluted weighted average shares outstanding |
|
|
603,300 |
|
|
|
589,881 |
|
|
|
|
|
|
|
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Dividends paid per common share |
|
$ |
0.18 |
|
|
$ |
0.18 |
|
AMCON Distributing Company and Subsidiaries |
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Condensed Consolidated Unaudited Statements of Shareholders’ Equity |
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for the three months ended December 31, 2023 and 2022 |
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Additional |
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|
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Common Stock |
|
Treasury Stock |
|
Paid-in |
|
Retained |
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|
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|
|
Shares |
|
Amount |
|
Shares |
|
Amount |
|
Capital |
|
Earnings |
|
Total |
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THREE MONTHS ENDED DECEMBER 2022 |
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|
|
|
|
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|
|
|
|
|
|
|
|
|
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|
||||
Balance, October 1, 2022 |
|
917,009 |
|
$ |
9,168 |
|
(332,220 |
) |
|
$ |
(30,867,287 |
) |
|
$ |
26,903,201 |
|
$ |
96,784,353 |
|
|
$ |
92,829,435 |
|
Dividends on common stock, |
|
— |
|
|
— |
|
— |
|
|
|
— |
|
|
|
— |
|
|
(3,200,650 |
) |
|
|
(3,200,650 |
) |
Compensation expense and issuance of stock in connection with equity-based awards |
|
26,263 |
|
|
263 |
|
— |
|
|
|
— |
|
|
|
2,453,953 |
|
|
— |
|
|
|
2,454,216 |
|
Net income available to common shareholders |
|
— |
|
|
— |
|
— |
|
|
|
— |
|
|
|
— |
|
|
2,629,001 |
|
|
|
2,629,001 |
|
Balance, December 31, 2022 |
|
943,272 |
|
$ |
9,431 |
|
(332,220 |
) |
|
$ |
(30,867,287 |
) |
|
$ |
29,357,154 |
|
$ |
96,212,704 |
|
|
$ |
94,712,002 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
THREE MONTHS ENDED DECEMBER 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance, October 1, 2023 |
|
943,272 |
|
$ |
9,431 |
|
(334,583 |
) |
|
$ |
(31,272,163 |
) |
|
$ |
30,585,388 |
|
$ |
104,846,438 |
|
|
$ |
104,169,094 |
|
Dividends on common stock, |
|
— |
|
|
— |
|
— |
|
|
|
— |
|
|
|
— |
|
|
(289,967 |
) |
|
|
(289,967 |
) |
Compensation expense and issuance of stock in connection with equity-based awards |
|
21,673 |
|
|
217 |
|
— |
|
|
|
— |
|
|
|
1,935,703 |
|
|
— |
|
|
|
1,935,920 |
|
Net income available to common shareholders |
|
— |
|
|
— |
|
— |
|
|
|
— |
|
|
|
— |
|
|
1,070,961 |
|
|
|
1,070,961 |
|
Balance, December 31, 2023 |
|
964,945 |
|
$ |
9,648 |
|
(334,583 |
) |
|
$ |
(31,272,163 |
) |
|
$ |
32,521,091 |
|
$ |
105,627,432 |
|
|
$ |
106,886,008 |
|
AMCON Distributing Company and Subsidiaries |
||||||||
Condensed Consolidated Unaudited Statements of Cash Flows |
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for the three months ended December 31, 2023 and 2022 |
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|
|
|
|
|
|
|
||
|
|
December |
|
December |
||||
|
|
2023 |
|
2022 |
||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
||
Net income available to common shareholders |
|
$ |
1,070,961 |
|
|
$ |
2,629,001 |
|
Adjustments to reconcile net income available to common shareholders to net cash flows from (used in) operating activities: |
|
|
|
|
|
|
||
Depreciation |
|
|
2,084,743 |
|
|
|
1,028,353 |
|
Amortization |
|
|
134,425 |
|
|
|
42,533 |
|
(Gain) loss on sales of property and equipment |
|
|
(53,287 |
) |
|
|
(36,000 |
) |
Equity-based compensation |
|
|
571,137 |
|
|
|
390,570 |
|
Deferred income taxes |
|
|
467,203 |
|
|
|
1,145,822 |
|
Provision for credit losses |
|
|
(91,969 |
) |
|
|
(496,332 |
) |
Inventory allowance |
|
|
30,988 |
|
|
|
141,087 |
|
Change in fair value of mandatorily redeemable non-controlling interest |
|
|
199,744 |
|
|
|
(54,916 |
) |
Changes in assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
2,147,484 |
|
|
|
8,381,282 |
|
Inventories |
|
|
384,466 |
|
|
|
(50,699,513 |
) |
Prepaid and other current assets |
|
|
(362,792 |
) |
|
|
45,110 |
|
Other assets |
|
|
(22,366 |
) |
|
|
199,411 |
|
Accounts payable |
|
|
1,627,403 |
|
|
|
(6,602,785 |
) |
Accrued expenses and accrued wages, salaries and bonuses |
|
|
(3,649,088 |
) |
|
|
(4,794,015 |
) |
Other long-term liabilities |
|
|
120,275 |
|
|
|
48,921 |
|
Income taxes payable and receivable |
|
|
336,797 |
|
|
|
158,978 |
|
Net cash flows from (used in) operating activities |
|
|
4,996,124 |
|
|
|
(48,472,493 |
) |
|
|
|
|
|
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
||
Purchase of property and equipment |
|
|
(3,947,143 |
) |
|
|
(1,455,405 |
) |
Proceeds from sales of property and equipment |
|
|
124,803 |
|
|
|
36,000 |
|
Net cash flows from (used in) investing activities |
|
|
(3,822,340 |
) |
|
|
(1,419,405 |
) |
|
|
|
|
|
|
|
||
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
||
Borrowings under revolving credit facilities |
|
|
603,650,771 |
|
|
|
639,488,133 |
|
Repayments under revolving credit facilities |
|
|
(604,014,807 |
) |
|
|
(589,262,053 |
) |
Principal payments on long-term debt |
|
|
(490,518 |
) |
|
|
(202,396 |
) |
Dividends on common stock |
|
|
(113,466 |
) |
|
|
(111,220 |
) |
Net cash flows from (used in) financing activities |
|
|
(968,020 |
) |
|
|
49,912,464 |
|
Net change in cash |
|
|
205,764 |
|
|
|
20,566 |
|
Cash, beginning of period |
|
|
790,931 |
|
|
|
431,576 |
|
Cash, end of period |
|
$ |
996,695 |
|
|
$ |
452,142 |
|
|
|
|
|
|
|
|
||
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
||
Cash paid during the period for interest |
|
$ |
2,235,562 |
|
|
$ |
1,458,843 |
|
|
|
|
|
|
|
|
||
Supplemental disclosure of non-cash information: |
|
|
|
|
|
|
||
Equipment acquisitions classified in accounts payable |
|
$ |
347,891 |
|
|
$ |
28,183 |
|
Dividends declared, not paid |
|
|
176,501 |
|
|
|
3,089,430 |
|
Issuance of common stock in connection with the vesting of equity-based awards |
|
|
1,296,372 |
|
|
|
2,044,805 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240118483412/en/
Charles J. Schmaderer
AMCON Distributing Company
Ph 402-331-3727
Source: AMCON Distributing Company
FAQ
What are the fully diluted earnings per share reported by AMCON Distributing Company for the first fiscal quarter ended December 31, 2023?
What is the net income available to common shareholders for AMCON Distributing Company for the first fiscal quarter ended December 31, 2023?
What challenges is AMCON Distributing Company facing in its business operations?
In which sectors is AMCON Distributing Company actively pursuing strategic acquisition opportunities?
What is the shareholders' equity of AMCON Distributing Company as of December 31, 2023?
