Omega Flex, Inc. Announces Second Quarter Earnings

Rhea-AI Summary

Omega Flex reported its financial results for the second quarter of 2020, revealing net sales of $47.08 million, a 12.2% decline from $53.60 million in the same period in 2019. The second quarter's net income was $7.92 million, down 5.4% from $8.37 million in 2019. Sales volume notably dropped in April due to non-essential business closures, particularly in residential construction, but showed improvement in May and June. The company managed to increase its income as a percentage of sales by cutting operating costs.

Positive

• Increased income as a percentage of sales despite decreased sales volume.
• Strong recovery in sales performance in June 2020, outpacing prior year.

Negative

• Net sales decreased by 12.2% compared to the first half of 2019.
• Net income declined by 5.4% compared to the same period in 2019.
• Significant sales drop in April due to non-essential business closures.

EXTON, Pa., July 16, 2020 (GLOBE NEWSWIRE) -- Omega Flex today reported its results of operations for the Second Quarter, 2020:

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		OMEGA FLEX, INC. (OFLX)
		Six Months Ended June 30,		Three Months Ended June 30,
44%; width:44%; min-width:44%;">	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">	12%; width:12%; min-width:12%;">2020	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">	12%; width:12%; min-width:12%;">2019	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">	12%; width:12%; min-width:12%;">2020	1%; width:1%; min-width:1%;">	1%; width:1%; min-width:1%;">	12%; width:12%; min-width:12%;">2019
Net Sales		$47,084,000		$53,597,000		$21,818,000		$26,809,000
Net Income attributable to Omega Flex, Inc.		$7,915,000		$8,365,000		$3,571,000		$3,983,000
Earnings Per Share – Basic and Diluted		$0.78		$0.83		$0.35		$0.39
Weighted Average Shares – Basic and Diluted			10,094,322			10,091,973			10,094,322			10,092,124

Kevin R. Hoben, Chairman and CEO, announced that the Company’s Net Sales for the first six months of 2020 and 2019 were $47,084,000 and $53,597,000, respectively, decreasing $6,513,000 or 12.2%.  Net Sales for the three months ended June 30, 2020 were 18.6% lower than the second quarter of 2019.   

The Company’s Net Income through June 2020 was $7,915,000 compared to $8,365,000 through the first six months of 2019, decreasing $450,000 or 5.4%.  Income for the second quarter of 2020 was 10.3% lower than 2019. 

With regards to the second quarter of 2020, the Company experienced a noticeable deterioration in its sales volume during April as non-essential businesses were closed, most notably residential construction work sites. The Company did however experience a strengthening during May, and concluded the quarter exceptionally strong, with June 2020 sales and profitability far outpacing the prior year. 

With regards to income, despite a decrease in sales volume and production levels during the second quarter, the Company has been able to minimize the impact, and has actually managed to increase its income as a percent of sales.  This was largely accomplished by curtailing various operating related costs, and by taking advantage of various cost savings opportunities. 

INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS – This news release contains forward-looking statements, which are subject to inherent uncertainties which are difficult to predict, and may be beyond the ability of Omega Flex to control.  Certain statements in this news release constitute forward-looking statements with the meaning of the Private Securities Litigation Reform act of 1995 that are not historical facts, but rather reflect Omega Flex’s current expectations concerning future results and events.  The words “believes,” “expects,” “intends,” “plans,” “anticipates,” “hopes,” “likely,” “will,” and similar expressions identify such forward-looking statements.  Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of Omega Flex (or entities in which Omega Flex has interests) or industry results, to differ materially from future results, performance or achievements expressed or implied by such forward-looking statements.  Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s view only as of the date of this news release.  Omega Flex undertakes no obligation to publicly release the result of any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, conditions or circumstances.

Contact:  Kevin R. Hoben
(610) 524-7272

FAQ

What were Omega Flex's net sales for the second quarter of 2020?

Omega Flex reported net sales of $47.08 million for the second quarter of 2020.

How much did net income decline for Omega Flex in the second quarter of 2020?

Net income for Omega Flex decreased by 5.4%, from $8.37 million in Q2 2019 to $7.92 million in Q2 2020.

What was the reason for the decline in Omega Flex's sales in Q2 2020?

Sales volume decreased significantly in April due to the closure of non-essential businesses, especially residential construction.

How did Omega Flex perform in June 2020 compared to prior months?

Omega Flex experienced strong sales and profitability in June, significantly outpacing the prior year.

What strategies did Omega Flex use to mitigate the impact of reduced sales?

The company minimized the impact by cutting operational costs and capitalizing on cost-saving opportunities.