爆料王

Record Fourth Quarter EPS Generated by Record Sales, Gross Margins and Operating Efficiencies.
Full-Year 2022 16% Sales Growth Leads to Record Profits, Operating Margin, EPS and Cash Flow.

MIAMI,聽Feb. 16, 2023聽(GLOBE NEWSWIRE) —聽爆料王.听(NYSE: WSO) announced record operating results for the fourth quarter and full year periods ended聽December 31, 2022聽and provided commentary on the Company鈥檚 business trends, growth opportunities, technology innovation and financial position.

Through its entrepreneurial and technology-driven culture,聽爆料王聽has established itself as the largest participant in the highly fragmented $50+ billion North American HVAC/R distribution market. Since entering distribution in 1989, sales and operating income have grown at compounded annual growth rates (CAGRs) of 15% and 19%, respectively, reflecting strong and consistent performance across various macroeconomic and industry cycles. Over this period, 爆料王鈥檚 dividends have grown at a 21% CAGR while maintaining a healthy balance sheet and strong cash flow.

Today鈥檚 results establish new records for sales, gross profit, operating income, net income, earnings per share (EPS) and operating cash flow for the fourth quarter and full year periods ended聽December 31, 2022. These results also reflect steady progress to grow and scale adoption of 爆料王鈥檚 industry-leading technology platforms, which collectively transform the customer experience, enhance operational efficiencies and help contractors grow faster as they deliver a more contemporary experience to homeowners and businesses. As our customers adapt to using more technology and embrace the on-going digital transformation,聽爆料王聽is uniquely positioned to benefit from its investments in the industry鈥檚 most robust assortment of technology platforms for HVAC/R contractors.

Albert H. Nahmad, 爆料王鈥檚 Chairman and CEO, commented: 鈥湵�料王 delivered another exceptional year of performance. Our leaders and associates in the field have accomplished extraordinary things and we thank them for their commitment and remarkable efforts to serve customers under challenging circumstances. Our culture is one of continuous improvement, so we continue to encourage our leaders to innovate and build on this success, particularly given the meaningful growth opportunities that we believe remain ahead of us.鈥�

Mr. Nahmad聽added: 鈥淲e also finished the year with a strong balance sheet consistent with our core philosophy to remain conservative and risk averse, while maintaining the capacity and flexibility to invest in organic and inorganic growth opportunities at a low cost of capital. We continue to seek acquisitions to partner with successful entrepreneurs and we are encouraged by current conditions. We also look to use our strength to expand our product portfolio and build on key OEM and supplier relationships to provide new opportunities for organic growth within our existing network of 673 locations across North America.鈥�

Fourth Quarter Results

• 76% increase in EPS to a record聽$3.55聽(includes tax benefit of聽$1.20聽per share from restricted stock vesting)
• 16% increase in EPS to聽$2.35聽on an adjusted, non-GAAP basis (excludes tax benefit)
• 5% increase in sales to a record聽$1.58 billion
• 5% increase in gross profit to a record聽$434 million聽(10 basis-point increase in gross margin to a record 27.4%)
• 3% increase in SG&A expenses
• 11% increase in operating income to a record聽$137 million聽(14% increase to聽$141 million聽on an adjusted basis)
• 60 basis-point increase in operating margins to a record 8.7% (80 basis-point increase to 8.9% on an adjusted basis)
• 75% increase in net income attributable to聽爆料王聽to聽$138 million聽(17% increase excluding tax benefit)
• Record operating cash flow of聽$213 million

Sales trends

• 2% increase in HVAC equipment (67% of sales), including 4% growth in the聽U.S.
• 6% increase in other HVAC products (29% of sales)
• 19% increase in commercial refrigeration products (4% of sales)

Mr. Nahmad聽stated: 鈥淥ur record fourth quarter performance is rewarding given the exceptional, comparative performance achieved last year when same-store sales grew 21% and EPS grew 77%. Our leadership teams have reacted to changing market conditions and produced terrific results through innovation and discipline, as evidenced by the enhanced gross margin and improved operating efficiencies.鈥�

Tax Benefit from Fourth Quarter Vesting of Restricted Stock
Fourth quarter and full-year results reflect the vesting of 975,622 shares of Class B restricted stock previously granted to the Company鈥檚 Chairman & CEO during the period from 1997 to 2011. The vesting occurred on聽October 15, 2022聽and provided a聽$49 million聽tax benefit to 2022 results pursuant to Accounting Standards Update (ASU) 2016-09,聽Improvements to Employee Share-Based Payment Accounting,聽as well as聽$3.6 million聽in incremental SG&A expenses, primarily related to employment-related taxes. The net benefit to fourth quarter EPS and full-year EPS was聽$1.20聽and聽$1.21, respectively. Due to the infrequent nature of this event, certain key performance metrics in 2022 are presented on an 鈥渁djusted basis鈥� to exclude the impact. Please see 鈥淯se of Non-GAAP Financial Information鈥� below.

It is important to note that the fourth and first quarters of each calendar year are highly seasonal due to the nature and timing of the replacement of HVAC systems. Results are typically strongest in the second and third quarters and the Company鈥檚 fourth quarter financial results are disproportionately affected by seasonality.

Full Year Results

• 43% increase in EPS to a record聽$15.41聽(includes tax benefit of聽$1.21聽per share from restricted stock vesting)
• 32% increase in EPS to聽$14.20聽on an adjusted basis, non-GAAP basis (excludes tax benefit)
• 16% increase in sales to a record聽$7.27 billion聽(14% increase on a same-store basis)
• 22% increase in gross profit to a record聽$2.03 billion聽(130 basis-point increase in gross margin to a record 27.9%)
• 15% increase in SG&A expenses (13% increase on a same-store basis)
• 10 basis-point decline in SG&A as a percentage of sales
• 32% increase in operating income to a record聽$832 million聽(33% increase to聽$835 million聽on an adjusted basis)
• 140 basis-point increase in operating margin to a record 11.4% (11.5% on an adjusted basis)
• 43% increase in net income attributable to聽爆料王聽to聽$601 million聽(33% increase excluding tax benefit)
• 64% increase in operating cash flow to a record聽$572 million

Sales trends (excluding acquisitions)

• 13% increase in HVAC equipment (68% of sales), including 14% growth in the聽U.S.
• 15% increase in other HVAC products (28% of sales)
• 24% increase in commercial refrigeration products (4% of sales)

Industry Catalysts & Trends
爆料王聽believes there are several company-specific and industry-wide factors that will provide incremental future growth opportunities. 爆料王鈥檚 scale, leading technology platforms, financial strength, entrepreneurial culture and OEM relationships 鈥� along with the essential nature of HVAC/R products 鈥� are important competitive advantages that provide stability to the Company鈥檚 performance over the long-term.

Regulatory Changes Impacting Climate Change.聽New聽U.S.听Federal regulatory standards became effective in 2023 that raise the minimum required efficiency for HVAC systems nationwide. Generally, higher-efficiency systems are sold at a higher price and provide homeowners and businesses the opportunity to reduce energy costs. New regulations are also in effect that institute a phase down of global warming properties of refrigerants currently used in older HVAC systems and a transition to new refrigerants beginning in 2025. Historically, refrigerant transitions have resulted in an increase in the cost to聽service and repair聽older HVAC systems,聽which in turn can provide a catalyst for replacement.

Federal Tax Credits and State Incentives.聽Demand for higher-efficiency products, such as variable-speed systems and heat pumps, is also expected to benefit following the passage of the Inflation Reduction Act of 2022 (IRA). The legislation is intended to promote replacement of older HVAC systems in favor of high-efficiency heat pump systems that reduce greenhouse gas emissions and thereby combat climate change. Programs include enhanced tax credits for homeowners who install new qualifying HVAC equipment and tax deductions for owners of commercial buildings that are upgraded to achieve defined energy savings. The IRA also sets aside聽$4.3 billion聽for state-administered consumer rebate programs designed to promote energy savings for low and medium-income households, including HVAC systems. Further details, including qualifying products, specific programs and other regulatory requirements contemplated by the IRA are being determined and are expected to be finalized during 2023.

Movement Toward Heat Pumps & Electrification of Fossil-Fuel Heating.听The HVAC industry has improved the operating characteristics of heat pumps, which offer the potential for growth as an alternative to the millions of fossil fuel-burning heating systems used throughout聽North America, particularly in Northern climates. Heat pump systems provide a combination of air conditioning and heating, may be ducted or ductless, generally sell at higher average unit prices and are available in a wide array of energy efficiencies. 爆料王鈥檚 sales of residential heat pumps in 2022 increased 25% (a 21% increase during the fourth quarter) outpacing overall HVAC equipment growth rates.

Product Breadth and End-Market Diversity.聽爆料王聽possesses the broadest and deepest assortment of products in the industry to support a wide array of customers and end-markets. The Company serves a contractor鈥檚 complete product needs ranging from residential ducted and ductless products, rooftops, VRF and engineered/applied systems. The Company serves various end-markets including residential, multi-family, commercial, institutional and more. In addition,聽爆料王聽maintains a deep catalog of OEM and aftermarket parts to support contractors and sustain competitiveness in any environment.

OEM and Supplier Relationships.聽As the leading distributor of HVAC/R products,聽爆料王聽sources from approximately 20 domestic and international OEMs and more than 1,300 other suppliers globally. Unlike most competitors,聽爆料王聽sells multiple name-brands of equipment at a wide variety of price points that appeal to a broad cross-section of contractors and consumers. We believe that close collaboration with manufacturing partners enhances 爆料王鈥檚 competitive positioning across its markets.

Geographic Positioning & Density in Key Markets.听Approximately 55% of 爆料王鈥檚 revenues are derived in core Sunbelt markets such as聽Florida,聽Texas, the Southeast and the Mid-Atlantic. Such markets also account for the greatest share of industry demand. Recent and ongoing demographic shifts within the聽U.S.听toward Sunbelt states favor continued growth in 爆料王鈥檚 core markets.

Network Expansion.聽爆料王鈥檚 network has grown by 67 locations over the last three years, primarily from six acquisitions of market-leading businesses, located primarily in markets that 爆料王聽did not previously serve. Through its market-leading 673 locations across聽North America, 爆料王鈥檚 network supports more than 350,000 contractors, technicians and installers with critical technical assistance, training and other resources to enhance their daily activities.

Advent of Ductless, High-Efficiency HVAC Products.聽爆料王聽is the leading distributor of ductless HVAC products used in both residential and commercial applications in聽North America. 爆料王鈥檚 sales of ductless products grew 22% in 2022 to approximately聽$560 million. We believe that the movement toward higher-efficiency ductless products (primarily heat pumps), the long-term upgrading of critical commercial infrastructure, along with the increasing acceptance of ductless technology by contractors and consumers, should benefit the sale of these products now and over the long-term.

Culture of Innovation
爆料王聽has developed the industry鈥檚 most advanced, user-friendly and customer-focused technology platforms, transforming how its contractor-customers engage with the Company and, increasingly, how those contractors engage with consumers and businesses. 爆料王鈥檚 community of active technology users grew sales faster than overall sales and experienced approximately 63% less annual attrition. The Company believes future results will benefit from continued customer adoption, new customer acquisition, reduced attrition and lower costs to serve. To that end, 爆料王聽 boosted its technology spending in 2022 by 14% to聽$49 million.

Specific technology-related updates include:

• Product Information Management聽(PIM)聽is 爆料王鈥檚 leading repository of product information delivered seamlessly through 爆料王鈥檚 mobile apps and e-commerce platform.听爆料王鈥檚聽PIM database contains approximately 1 million SKUs accessed by more than 350,000 contractors and technicians annually.
• HVAC Pro+ Mobile Apps聽provide customers real-time access to critical information that improves speed and productivity. This includes real time technical support, product detail, inventory availability, warranty look-up, system match ups, e-commerce and more. The authenticated user community (mobile app users linked to an e-commerce account) grew 20% year-to-date to more than 51,000 users.
• E-Commerce Sales聽grew 17% in 2022, outpacing organic sales growth rates, to more than聽$2.3 billion. E-commerce sales were 32% of total sales inclusive of acquired revenues.
• OnCall Air庐,聽爆料王鈥檚 digital sales platform and聽颁谤别诲颈迟贵辞谤颁辞尘蹿辞谤迟庐,聽its companion consumer financing platform, both increased penetration among HVAC/R contractors as more customers engage digitally with homeowners. During 2022,聽OnCall Air庐 presented quotes to approximately 225,000 households, a 37% increase over last year, and generated聽$939聽million聽in gross merchandise value, a 49% increase over the same period last year.

A.J. Nahmad, 爆料王鈥檚 President, added: 鈥淥ur technology platforms 鈥� which are unique to the industry 鈥� have transformed nearly every aspect of our business. The contractor-based platforms, like our HVAC Pro+ suite of apps and OnCallAir, combined with our internal-facing technologies, have bolstered 爆料王鈥檚 market share, energized new customer acquisition and driven margin expansion. We continue to see higher growth rates, lower attrition and lower costs to serve among active users of our technology. Consistent with our long-term focus, we are investing more to accelerate adoption and sustain our leadership position. As the industry evolves to operating in the digital age, 爆料王鈥檚 technology tools will provide added value to an ever-growing number of contractors.鈥�

Cash Flow & Dividends
爆料王鈥檚 full-year operating cash flow in 2022 increased 64% to a record聽$572 million聽(a record聽$213 million聽in operating cash flow for the fourth quarter). The Company鈥檚 philosophy is to share increasing amounts of cash flow through higher dividends while maintaining a conservative financial position with continued capacity to build its distribution network. The Company鈥檚 Board of Directors authorized an 11% increase in聽爆料王鈥檚 annual dividend rate effective in聽January 2023聽to聽$9.80聽per share. Future dividend increases will be considered in light of investment opportunities, general economic conditions and the Company鈥檚 overall financial position.

Fourth Quarter Earnings Conference Call Information
Date and time:聽February 16, 2023聽at聽10:00 a.m. (ET)
奥别产肠补蝉迟:听聽(a replay will be available on the Company鈥檚 website)
Dial-in number:聽United States聽(844) 883-3908 / International (412) 317-9254

Use of Non-GAAP Financial Information
In this release, the Company discloses certain performance measures on a 鈥渟ame-store basis鈥�, which are non-GAAP and exclude the effects of locations closed, acquired, or locations opened, in each case during the immediately preceding 12 months, unless such locations are within close geographical proximity to existing locations. The Company also discloses operating income, operating margins and diluted EPS on an adjusted, non-GAAP basis to exclude the impact caused by the vesting of restricted stock on聽October 15, 2022聽as described above. The Company believes that this information provides greater comparability regarding its ongoing operating performance. These measures should not be considered an alternative to measurements required by聽U.S.听GAAP.

Reconciliation of operating income, a GAAP measure, to operating income on an adjusted basis, a non-GAAP measure:

Reconciliation of diluted EPS for Common and Class B common stock, a GAAP measure, to diluted EPS for Common and Class B common stock on an adjusted basis, a non-GAAP measure:

础产辞耻迟听奥补迟蝉肠辞
爆料王聽is the largest distribution network for heating, air conditioning and refrigeration (HVAC/R) products with locations in聽the United States,聽Canada,聽Mexico聽and聽Puerto Rico, and on an export basis to聽Latin America聽and the聽Caribbean. 爆料王聽estimates that over 350,000 contractors and technicians visit or call one of its 673 locations each year to get information, obtain technical support and buy products.

爆料王鈥檚聽has the opportunity to be a significant and important contributor toward climate change as its business plays an important role in the drive to lower CO2e聽emissions.听According to the聽Department of聽Energy, HVAC systems account for roughly half of聽U.S.听household energy consumption. As such, replacing HVAC systems at higher efficiency levels is one of the most meaningful steps homeowners can take to reduce electricity consumption and carbon聽footprint over time.听The overwhelming majority of new HVAC systems聽sold by聽爆料王聽replace systems that likely operate well below current minimum efficiency standards in the聽U.S. As consumers replace HVAC systems with new, higher-efficiency systems,聽homeowners will consume less energy, save costs and reduce the carbon footprint over time.

Based on estimates validated by independent sources,聽爆料王聽averted an estimated 15.8 million metric tons of CO2e emissions from聽January 1, 2020聽to聽December 31, 2022聽through the sale of replacement HVAC systems at higher-efficiency standards (an equivalent of removing 3.4 million gas powered vehicles off the road for a year). More information, including sources and assumptions used to support the Company鈥檚 estimates, can be found at聽.

This document includes certain 鈥渇orward-looking statements鈥� within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may address, among other things, our expected financial and operational results and the related assumptions underlying our expected results. These forward-looking statements are distinguished by use of words such as 鈥渨ill,鈥� 鈥渨ould,鈥� 鈥渁nticipate,鈥� 鈥渆xpect,鈥� 鈥渂elieve,鈥� 鈥渄esigned,鈥� 鈥減lan,鈥� or 鈥渋ntend,鈥� the negative of these terms, and similar references to future periods. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to changes in economic, business, competitive market, new housing starts and completions, capital spending in commercial construction, consumer spending and debt levels, regulatory and other factors, including, without limitation, the effects of supplier concentration, competitive conditions within 爆料王鈥檚 industry, the seasonality of sales of 爆料王鈥檚 products, the ability of the Company to expand its business, insurance coverage risks and final GAAP adjustments. Detailed information about these factors and additional important factors can be found in the documents filed by聽爆料王聽with the聽Securities and Exchange Commission, such as Form 10-K, Form 10-Q and Form 8-K. Forward-looking statements speak only as of the date the statements were made.听爆料王聽assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, except as required by applicable law.

Barry S. Logan
爆料王.
Executive Vice President
(305) 714-4102

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