Encore Wire Reports First Quarter Results; Continued Strong Gross Profit Margins; Highlights Share Repurchases During Quarter
Encore Wire Corporation (NASDAQ: WIRE) reported strong first quarter 2022 results, with diluted earnings per share reaching $7.96 and net income of $161.5 million, up from $41.2 million in Q1 2021. Net sales surged to $723.1 million, fueled by an 8.6% increase in copper volume sold. The gross profit margin stood at 33.7%, down slightly from 34.2% the previous quarter. The company repurchased 500,917 shares and maintained a cash balance of $466.1 million. The ongoing expansion and investments aim to strengthen Encore Wire's competitive position in the market.
- Net income rose to $161.5 million from $41.2 million YoY.
- Earnings per diluted share increased to $7.96, compared to $1.99 YoY.
- Net sales grew to $723.1 million, a significant increase from $444.1 million YoY.
- Copper volume sold climbed by 8.6% over the same quarter last year.
- The company repurchased 500,917 shares, supporting shareholder value.
- Gross profit margin decreased from 34.2% in Q4 2021 to 33.7%.
First Quarter 2022 Highlights
-
First Quarter Earnings per diluted share of
$7.96 -
First Quarter Net income of
$161.5 million - Gross profit margin abatement remained gradual in the first quarter of 2022
-
Gross profit of
33.7% in first quarter of 2022;34.2% in fourth quarter of 2021 -
Copper volume sold increased
8.6% over first quarter of 2021; increased2.8% over fourth quarter of 2021 -
Cash on hand of
as of$466.1 million March 31, 2022 - Company repurchased 500,917 shares during the quarter; 1,499,083 shares remain authorized to be repurchased
Net sales for the first quarter ended
Gross profit percentage for the first quarter of 2022 was
Net income for the first quarter of 2022 was
Aluminum wire represented
Commenting on the results,
Copper unit volumes increased
We continue to believe
Our balance sheet remains very strong. We have no long-term debt, and our revolving line of credit remains untapped. We had
The new service center opened in
The incremental investments announced in
Our low-cost structure and strong balance sheet have allowed us the flexibility to adapt quickly to changing market conditions, and we believe they are continuing to prove valuable now. We thank our employees and associates for their outstanding effort and our shareholders for their continued support.
The health and safety of our employees and their families remain our top priority, and we are following CDC guidelines to maintain safe working conditions. The Company is unable to predict the impact that COVID-19, or any of the ongoing variants, may have on our financial position and operating results in future periods. The duration or re-emergence of the outbreak and its long-term impact on our business remain uncertain.”
The Company will host a conference call to discuss the first quarter results on
The matters discussed in this news release may include forward-looking statements. Forward-looking statements can be identified by words such as: “anticipate”, “intend”, “plan”, “goal”, “seek”, “believe”, “project”, “estimate”, “expect”, “strategy”, “future”, “likely”, “may”, “should”, “will” and similar references to future periods. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, such statements are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Therefore, you should not rely on any of these forward-looking statements. Examples of such uncertainties and risks include, but are not limited to, statements about the pricing environment of copper, aluminum and other raw materials, the duration, magnitude and impact of the ongoing COVID-19 global pandemic, our order fill rates, profitability and stockholder value, payment of future dividends, future purchases of stock, the impact of competitive pricing and other risks detailed from time to time in the Company’s reports filed with the
Additional Disclosures:
The term “EBITDA” is used by the Company in presentations, quarterly conference calls and other instances as appropriate. EBITDA is defined as net income before interest, income taxes, depreciation and amortization. The Company presents EBITDA because it is a required component of financial ratios reported by the Company to the Company’s banks, and is also frequently used by securities analysts, investors and other interested parties, in addition to and not in lieu of measures of financial performance calculated and presented in accordance with Generally Accepted Accounting Principles (“GAAP”), to compare to the performance of other companies who also publicize this information. EBITDA is not a measurement of financial performance calculated and presented in accordance with GAAP and should not be considered an alternative to net income as an indicator of the Company’s operating performance or any other measure of financial performance calculated and presented in accordance with GAAP.
The Company has reconciled EBITDA with net income for fiscal years 1996 to 2021 on previous reports on Form 8-K filed with the
|
|
Quarter Ended |
||||
In Thousands |
|
2022 |
|
2021 |
||
Net Income |
|
$ |
161,531 |
|
$ |
41,189 |
Income Tax Expense |
|
|
46,119 |
|
|
12,188 |
Interest Expense |
|
|
101 |
|
|
82 |
Depreciation and Amortization |
|
|
6,210 |
|
|
5,300 |
EBITDA |
|
$ |
213,961 |
|
$ |
58,759 |
|
||||||||
Balance Sheets |
||||||||
(In Thousands) |
||||||||
|
|
|
|
|||||
|
(Unaudited) |
|
(Audited) |
|||||
Assets |
|
|
|
|||||
Current assets: |
|
|
|
|||||
Cash and cash equivalents |
$ |
466,094 |
|
|
$ |
438,990 |
|
|
Accounts receivable, net of allowance of |
|
549,404 |
|
|
|
491,126 |
|
|
Inventories, net |
|
116,331 |
|
|
|
100,816 |
|
|
Income tax receivable |
|
— |
|
|
|
951 |
|
|
Prepaid expenses and other |
|
3,391 |
|
|
|
3,167 |
|
|
Total current assets |
|
1,135,220 |
|
|
|
1,035,050 |
|
|
Property, plant and equipment, net |
|
524,465 |
|
|
|
494,916 |
|
|
Other assets |
|
539 |
|
|
|
570 |
|
|
Total assets |
$ |
1,660,224 |
|
|
$ |
1,530,536 |
|
|
|
|
|
|
|||||
Liabilities and Stockholders’ Equity |
|
|
|
|||||
Current liabilities: |
|
|
|
|||||
Trade accounts payable |
$ |
73,189 |
|
|
$ |
75,353 |
|
|
Accrued liabilities |
|
61,525 |
|
|
|
78,747 |
|
|
Income taxes payable |
|
48,393 |
|
|
|
— |
|
|
Total current liabilities |
|
183,107 |
|
|
|
154,100 |
|
|
Deferred income taxes and other |
|
33,180 |
|
|
|
37,347 |
|
|
Commitments and contingencies |
|
|
|
|||||
Stockholders’ equity: |
|
|
|
|||||
Preferred stock, |
|
|
|
|||||
Authorized shares – 2,000,000; none issued |
|
— |
|
|
|
— |
|
|
Common stock, |
|
|
|
|||||
Authorized shares – 40,000,000; |
|
|
|
|||||
Issued shares – 27,127,850 and 27,083,100 |
|
271 |
|
|
|
271 |
|
|
Additional paid-in capital |
|
74,847 |
|
|
|
72,753 |
|
|
|
|
(213,397 |
) |
|
|
(155,014 |
) |
|
Retained earnings |
|
1,582,216 |
|
|
|
1,421,079 |
|
|
Total stockholders’ equity |
|
1,443,937 |
|
|
|
1,339,089 |
|
|
Total liabilities and stockholders’ equity |
$ |
1,660,224 |
|
|
$ |
1,530,536 |
|
|
||||||||
Statements of Income |
||||||||
(In thousands, except per share data) |
||||||||
|
Quarter Ended |
|||||||
|
2022 |
|
2021 |
|||||
|
(Unaudited) |
|||||||
|
|
|
|
|
|
|
|
|
Net sales |
|
|
100.0 % |
|
|
|
100.0 % |
|
Cost of goods sold |
479,325 |
|
66.3 % |
|
359,636 |
|
81.0 % |
|
Gross profit |
243,747 |
|
33.7 % |
|
84,504 |
|
19.0 % |
|
|
|
|
|
|
|
|
|
|
Selling, general, and administrative expenses |
36,212 |
|
5.0 % |
|
31,152 |
|
7.0 % |
|
Operating income |
207,535 |
|
28.7 % |
|
53,352 |
|
12.0 % |
|
|
|
|
|
|
|
|
|
|
Net interest and other income |
115 |
|
— % |
|
25 |
|
— % |
|
Income before income taxes |
207,650 |
|
28.7 % |
|
53,377 |
|
12.0 % |
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
46,119 |
|
6.4 % |
|
12,188 |
|
2.7 % |
|
Net income |
|
|
22.3 % |
|
|
|
9.3 % |
|
Earnings per common and common equivalent share – basic |
|
|
|
|
|
|
|
|
Earnings per common and common equivalent share – diluted |
|
|
|
|
|
|
|
|
Weighted average common and common equivalent shares outstanding – basic |
20,003 |
|
|
|
20,568 |
|
|
|
Weighted average common and common equivalent shares outstanding – diluted |
20,302 |
|
|
|
20,719 |
|
|
|
Cash Dividends Declared per Share |
|
|
|
|
|
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20220428006303/en/
Chief Financial Officer
972-562-9473
Source:
FAQ
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