EnviroStar, Inc. (NYSE American:EVI) reported record results for
the fiscal year ended June 30, 2017.
Fiscal 2017 Highlights (compared to EVI’s results for the
fiscal year ended June 30, 2016):
- Revenue increased 161% to a record $94
million,
- Operating income increased 92% to a
record $5.4 million,
- Net income increased 82% to a record
$3.2 million,
- Adjusted EBITDA increased 123% to $6.3
million, and
- Earnings per share increased 24% to a
record $0.31 per share.
Henry M. Nahmad, EVI’s Chairman and Chief Executive Officer
stated: “Our focus on delivering high growth in revenues and
profits by executing our unique buy and build strategy was
transformational for the Company during fiscal 2017. We are excited
about our acquisition and organic growth opportunities, including
the contemplated acquisition of Tri-State Technical Services, Inc.,
which we believe will continue this trend in fiscal 2018.”
Buy Activity
Consistent with EVI’s buy and build strategy, as previously
announced, EVI acquired Western State Design on October 10, 2016
and Martin-Ray Laundry Systems on June 20, 2017. EVI’s results for
fiscal 2017 include the results of the acquired businesses since
the acquisition dates, which is less than nine-months of results of
Western State Design and only two weeks of results of Martin-Ray.
Additionally, on September 8, 2017 the Company entered into a
definitive agreement to purchase Tri-State Technical Services,
Inc., a Georgia-based distributor with revenues of approximately
$27 million for the twelve-months ended June 30, 2017. The
acquisition of Tri-State is subject to certain customary closing
conditions.
Mr. Nahmad commented: “We believe the acquisitions we completed
during fiscal 2017 and our contemplated acquisition of Tri-State is
just the beginning of what we expect will be a sustained effort to
build a major enterprise in the commercial laundry and related
products and services industries. We are pleased that the owners of
our acquired businesses share our vision by making a long-term
financial investment in our Company through their receipt of
significant stock consideration in connection with the
transactions.”
Build Activity
In addition to the acquisitions described above and consistent
with the “build” component of EVI’s growth strategy, the management
teams of EVI and its acquired businesses are undertaking growth
initiatives, including efforts relating to the addition of new
product lines, enhancing installation and service capabilities,
implementing scalable technologies, and recruiting talented people
to address the needs of the Company’s growing customer base.
Mr. Nahmad commented: “Our operating philosophy encourages our
local leadership to operate in a manner that builds upon the
long-term relationships they have established with their suppliers
and customers. This approach combined with access to EVI’s
resources, allows us the opportunity to build on the value of the
acquired businesses.”
Use of Non-GAAP Financial Information
In this release, EVI discloses the non-GAAP financial measure of
Adjusted EBITDA, which EVI defines as earnings before interest,
taxes, depreciation, amortization, and amortization of share-based
compensation. Adjusted EBITDA is determined by adding interest
expense, income taxes, depreciation, amortization, and amortization
of share-based compensation to net income as shown in the attached
Condensed Consolidated Earnings before Interest, Taxes,
Depreciation, Amortization, and Amortization of Share-based
Compensation. EVI considers Adjusted EBITDA to be an important
indicator of its operating performance. Adjusted EBITDA is also
used by companies, lenders, investors and others because it
excludes certain items that can vary widely across different
industries or among companies within the same industry. For
example, interest expense can be dependent on a company’s capital
structure, debt levels and credit ratings, and the tax positions of
companies can vary because of their differing abilities to take
advantage of tax benefits and because of the tax policies of the
jurisdictions in which they operate. Adjusted EBITDA should not be
considered as an alternative to net income or any other measure of
financial performance or liquidity, including cash flow, derived in
accordance with GAAP, or to any other method of analyzing EVI’s
results as reported under GAAP. In addition, EVI’s definition of
Adjusted EBITDA may not be comparable to definitions of Adjusted
EBITDA or other similarly titled measures used by other
companies.
About EnviroStar
EnviroStar, Inc. is a distributor of commercial, industrial, and
vended laundry products and industrial boilers, including related
parts and supplies. Through its subsidiaries, EVI sells its
products and provides installation and maintenance services to
thousands of customers across the United States, Canada, the
Caribbean, and Latin America.
Safe Harbor Statement
Except for the historical matters contained herein, statements
in this press release are forward-looking and are made pursuant to
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements are subject to a
number of known and unknown risks and uncertainties that may cause
actual results, trends, performance or achievements of EVI, or
industry trends and results, to differ from the future results,
trends, performance or achievements expressed or implied by such
forward-looking statements. These risks and uncertainties include,
among others, the risks related to EVI’s business, results
(including future revenues and profits), financial condition,
growth strategy and prospects, risks related to EVI’s ability to
successfully build its existing operations, risks related to
organic growth initiatives and their impact on EVI’s financial
condition and results of operations, risks associated with the
EVI’s buy and build growth strategy, including that EVI may not be
successful in identifying or consummating acquisitions or other
strategic opportunities, including that the contemplated
acquisition of Tri-State Technical Services may not be consummated
when anticipated, on the contemplated terms, or at all, that the
potential benefits of acquisitions may not be realized to the
extent anticipated or at all, integration risks, risks related to
indebtedness incurred in connection with acquisitions, dilution
experienced by EVI’s stockholders as a result of shares issued in
connection with acquisitions and the financing of acquisitions, and
risks related to the business, operations and prospects of acquired
businesses, the risk that dividends may not be paid when or in the
amounts anticipated, or at all, and other economic, competitive,
governmental, technological and other risks and factors, including
those discussed in the Company’s filings with the Securities and
Exchange Commission, including, without limitation, the Company’s
Annual Report on Form 10-K for the fiscal year ended June 30, 2017.
Many of these risks and factors are beyond EVI’s control. In
addition, past performance and perceived trends may not be
indicative of future results. EVI cautions that the foregoing
factors are not exclusive. The reader should not place undue
reliance on any forward-looking statement, which speaks only as of
the date made. EVI does not undertake to, and specifically
disclaims any obligation to, update or supplement any
forward-looking statement, whether as a result of changes in
circumstances, new information, subsequent events or otherwise,
except as may be required by law.
EnviroStar, Inc. Condensed
Consolidated Results of Operations (in thousands)
Fiscal Year Ended
June 30,
2017
June 30,
2016
Revenues $93,978 $36,016 Cost of Sales 73,639 27,804
Gross Profit 20,339 8,212 SG&A 14,989 5,421 Operating
Income 5,350 2,791 Interest Expense (Income), net 160 (2)
Income before Income Taxes 5,190 2,793 Provision for Income Taxes
2,023 1,053 Net Income $3,167 $1,740 Net
Income per Share Basic $0.31 $0.25 Diluted $0.31 $0.25
Weighted Average Shares Outstanding Basic 9,449 7,034 Diluted 9,537
7,034
The following table reconciles net income, the most comparable
GAAP financial measure, to Adjusted EBITDA.
EnviroStar, Inc.
Condensed Consolidated Earnings before
Interest, Taxes, Depreciation, Amortization, and Amortization of
Share-
based Compensation (in thousands)
Fiscal Year Ended
June 30,
2017
June 30,
2016
Net Income $3,167 $1,740 Provision for Income Taxes 2,023
1,053 Interest Expense 160 (2) Depreciation and Amortization 576 61
Amortization of Share-based Compensation 421 - Adjusted EBITDA
$6,347 $2,852
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version on businesswire.com: http://www.businesswire.com/news/home/20170928006336/en/
EnviroStar, Inc.Rob Lazar, 305-754-8676
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