Select Interior Concepts, Inc. (NASDAQ: SIC), a premier installer
and nationwide distributor of interior building products, today
announced its financial results for the second quarter ended June
30, 2020.
SECOND QUARTER 2020 FINANCIAL HIGHLIGHTS COMPARED TO
SECOND QUARTER 2019
- Consolidated net sales of $125.4 million, compared to $158.3
million
- Gross profit was $30.7 million, compared to $44.2 million
- Net loss was ($3.2 million), or ($0.13) EPS, compared to net
income of $1.2 million, or $0.05 basic and diluted EPS
- EBITDA of $5.7 million, compared to $12.2 million
- Adjusted EBITDA of $10.4 million, compared to $16.6
million
- Operating cash flow provided $9.7 million, compared to a use of
$1.7 million
- Liquidity of $62.6 million, including $2.9 million of cash plus
$59.7 million of availability under the revolving credit facility,
compared to $55.3 million
- Executed on a wide range of actions in response to the COVID-19
pandemic resulting in approximately $7 million in cost savings;
estimated $14-$16 million of full year 2020 cost savings
SIX MONTHS 2020 FINANCIAL HIGHLIGHTS COMPARED TO SIX
MONTHS 2019
- Consolidated net sales of $259.8 million, compared to $295.3
million
- Gross profit was $61.4 million, compared to $82.9 million
- Net loss was ($7.2 million), or ($0.28) EPS, compared to net
income of $1.3 million, or $0.05 basic and diluted EPS
- EBITDA of $8.0 million, compared to $23.4 million
- Adjusted EBITDA of $14.9 million, compared to $29.1
million
- Operating cash flow provided $17.6 million, compared to $8.8
million
Chief Executive Officer L.W. (Bill) Varner Jr. commented, “As
expected, SIC’s second-quarter financial results were impacted by
the challenging macro-economic environment created by the COVID-19
pandemic. Sales dropped 25% in April; however, business activity
picked up in May and June.”
“Since joining SIC on June 9, 2020, I’ve been impressed by the
talented group of dedicated employees at the company and its
innovative products and services,” added Mr. Varner. “I am excited
that SIC has a significant value creation proposition to develop a
corporate infrastructure with a unified back office, human capital
and IT functions. We also have opportunities to optimize our supply
chain and better utilize our current facilities at both RDS and
ASG. One of my top priorities for 2020 will be to further integrate
the operations of RDS and ASG, in the process driving
cross-selling, synergies, and cost-savings while profitably growing
the business. Other key focus areas will be to enhance SIC’s
existing capital structure and to develop a more comprehensive
long-term growth strategy that will create enhanced value for all
SIC stakeholders. We took an important step last week when Patrick
Dussinger joined us as President of ASG. We are all encouraged by
external indicators that the homebuilding and remodel spaces
continue to strengthen despite challenges felt across the broader
economy.
“I look forward to working with the teams at SIC to create value
for all stakeholders – our shareholders, customers, suppliers,
partners and employees – through strong execution of the business
plan to enhance returns on capital.” RESULTS FOR THE SECOND
QUARTER OF 2020
Net sales for the second quarter of 2020 decreased by 20.8% to
$125.4 million, compared to net sales of $158.3 million for the
second quarter of 2019. Net sales in both segments were negatively
affected by the COVID-19 pandemic. Volume and price/mix were
negative for both segments in the quarter. Residential Design
Services (“RDS”) segment sales decreased 20.9%. The decrease was
largely due to decreased sales volume in the quarter as a result of
the COVID-19 pandemic. Stay at home orders heavily impacted our
business in California and new safety measures and restrictions
lowered productivity at RDS job sites. RDS design center activity
was also limited due to lockdowns and wariness of in-person
interaction. Architectural Surfaces Group (“ASG”) segment sales
declined 20.9% due to lower natural stone, quartz, and tile sales
volume primarily as a result of the COVID-19 pandemic. Stay at home
orders heavily impacted our business in Washington. ASG showrooms
were limited to appointment only showings and sales. Additionally,
our fabricator customers were unable to execute in-residence
installations due to stay at home orders at many of our locations
combined with homeowner concerns about the pandemic.
Gross profit for the second quarter of 2020 decreased by 30.5%
to $30.7 million, compared to $44.2 million for the second quarter
of 2019. The decrease in gross profit was primarily due to lower
revenues resulting from the COVID-19 pandemic. Gross margin for the
second quarter of 2020 was 24.5%, compared to 27.9% for the second
quarter of 2019. In the RDS segment, gross margin decreased 4.0
percentage points to 23.8% due to unabsorbed fixed costs and
unfavorable change in product mix. In the ASG segment, gross margin
decreased 2.2 percentage points to 25.5% primarily due to
unabsorbed fixed costs and unfavorable changes in product and price
mix.
Selling, general and administrative (“SG&A”) expenses for
the second quarter of 2020 were $30.7 million, or 24.5% of net
sales, compared to $37.4 million, or 23.6% of net sales, for the
second quarter of 2019. SG&A for the second quarter of 2020 and
2019 included $4.3 million and $3.3 million, respectively, of
equity-based compensation and certain nonrecurring costs. On an
adjusted basis, which excludes equity-based compensation and
certain nonrecurring costs, SG&A was $26.4 million, or 21.1% of
net sales for the second quarter of 2020, compared to $34.2
million, or 21.6% of net sales, for the second quarter of 2019.
This decrease reflects lower sales commissions and bonuses, savings
from position eliminations and furloughs, and other cost reduction
initiatives in response to COVID-19.
For the second quarter of 2020, net loss was ($3.2) million, or
($0.13) earnings per share, compared to net income of $1.2 million,
or $0.05 basic and diluted earnings per share for the second
quarter of 2019. Net income for the second quarter of 2019 included
$1.0 million of other expense, which primarily resulted from a
change in the fair value of earnout liabilities for completed
acquisitions.
EBITDA for the second quarter of 2020 decreased
53.1% to $5.7 million, compared to EBITDA of $12.2 million for the
second quarter of 2019. Adjusted EBITDA, which excludes the impact
of equity compensation and certain non-recurring costs, for the
second quarter of 2020 decreased by 37.6% to $10.4 million,
compared to $16.6 million for the second quarter of 2019. For the
second quarter of 2020, Adjusted EBITDA as a percentage of net
sales was 8.3%, compared to 10.5% for the second quarter of
2019.
Operating cash flow totaled $9.7 million for the second quarter
of 2020, compared to a use of cash from operations of $1.7 million
for the second quarter of 2019 primarily as a result of improved
working capital management and liquidity measures taken in response
to the COVID-19 pandemic. Liquidity from cash-on-hand and borrowing
availability under the Company’s revolving credit facility totaled
$62.6 million at June 30, 2020, compared to $55.3 million at June
30, 2019.
RESULTS FOR THE SIX MONTHS ENDED JUNE 30,
2020
Net sales for the first half of 2020 decreased by $35.4 million
or 12.0% to $259.8 million, compared to net sales of $295.3 million
for the first half of 2019. RDS segment sales decreased 11.6%. The
decrease was largely due to volume declines in California and the
Eastern Region. These declines are primarily attributable to the
COVID-19 pandemic, as well as price/mix in certain markets. Stay at
home orders heavily impacted our business in California and new
safety measures and restrictions lowered productivity at RDS job
sites. RDS design center activity was limited due to lockdowns and
wariness of in-person interaction. The decline in organic volume
was partially offset by increased sales from the acquisition of
Intown in March 2019. ASG segment sales decreased 12.8%. This
decrease was due to a decrease in volume of all products sold other
than Pental quartz, which increased slightly. The decrease in
overall volume was primarily due to the COVID-19 pandemic. Stay at
home orders heavily impacted our business in Washington. ASG
showrooms were limited to appointment only sales. Additionally, our
fabricator customers were unable to execute in-residence
installations due to stay at home orders at many of our locations
combined with homeowner concerns about the pandemic. Volume and
price/mix were both negative for the first half of 2020 compared to
the first half of 2019.
Gross profit for the first half of 2020 decreased by 25.9% to
$61.4 million, compared to $82.9 million for the first half of
2019. The decrease in gross profit was primarily a result of lower
net sales due to the COVID-19 pandemic. Gross margin for the first
half of 2020 was 23.6%, compared to 28.1% for the first half of
2019. In the RDS segment, gross margin decreased 5.1 percentage
points to 22.9% for the first half of 2020, from 28.0% for the
first half of 2019. This decrease is due to unabsorbed fixed costs
and an unfavorable change in product mix. In the ASG segment, gross
margin decreased 3.1 percentage points to 24.6%, for the first half
of 2020, from 27.8% for the first half of 2019. The decrease was
primarily due to unfavorable changes in product and price mix,
unabsorbed fixed costs, and an increase in other non-product
costs.
Selling, general and administrative (“SG&A”) expenses for
the first half of 2020 were $63.4 million, or 24.4% of net sales,
compared to $72.9 million, or 24.7% of net sales, for the first
half of 2019. SG&A for the first half of 2020 and 2019 included
$5.2 million and $6.1 million, respectively, of equity-based
compensation and certain nonrecurring costs. On an adjusted basis,
which excludes equity-based compensation and certain nonrecurring
costs, SG&A was $58.2 million, or 22.4% of net sales for the
first half of 2020, compared to $66.8 million, or 22.6% of net
sales, for the first half of 2019, primarily reflecting lower sales
commissions and bonuses, savings from position eliminations and
furloughs, and other cost reduction initiatives in response to
COVID-19.
For the first half of 2020, net loss was ($7.2) million, or
($0.28) earnings per share, compared to net income of $1.3 million,
or $0.05 basic and diluted earnings per share for the first half of
2019. Net income for the first half of 2019 included $0.7 million
of other income, which primarily resulted from a change in the fair
value of earnout liabilities for completed acquisitions.
EBITDA for the first half of 2020 decreased
65.8% to $8.0 million, compared to EBITDA of $23.4 million for the
first half of 2019. Adjusted EBITDA, which excludes the impact of
equity compensation and certain non-recurring costs, for the first
half of 2020 decreased by 48.8% to $14.9 million, compared to $29.1
million for the first half of 2019. For the first half of 2020,
Adjusted EBITDA as a percentage of net sales was 5.7%, compared to
9.9% for the first half of 2019.
Operating cash flow totaled $17.6 million for the first half of
2020, compared to $8.8 million for the first half of 2019,
primarily as a result of improved working capital management.
COST AND CASH SAVINGS ACTIONS
Given the continued economic impact of COVID-19 on housing
construction and remodeling activity, in April 2020 the Company
took steps to align its cost structure and capital resources with
the current level of work. The Company’s measures to rationalize
costs and preserve cash included hiring freezes, targeted furloughs
and reductions of workforce across business units, reduced bonuses,
and cutting management salaries, along with enforcing strict
controls on non-critical expenditures.
During the quarter, the company executed on these initiatives as
a response to declining revenues, resulting in approximately $7
million in cost savings. The Company expects these initiatives to
provide an estimated cost benefit of $14 million to $16 million to
its full year 2020 financial results, further enhancing its
liquidity and cash flow.
FINANCIAL RESULTS CONFERENCE CALL AND WEBCAST
DETAILS
The Company will host a conference call today at 9:00 a.m. EDT
to discuss results for the second quarter ended June 30, 2020 and
other matters relating to the Company. To participate in the
conference call, dial 1-888-224-1005 from the United States, and
international callers may dial 1-720-543-0302, approximately 15
minutes before the call. A webcast and presentation will also be
available at www.selectinteriorconcepts.com under the investor
relations section. A replay of the call and webcast will be
available on the Company's website approximately four hours after
the completion of the call. During the conference call, the Company
may discuss and answer one or more questions concerning business
and financial matters and trends affecting the Company. The
Company’s responses to these questions, as well as other matters
discussed during the conference call, may contain or constitute
material information that has not been previously disclosed.
ABOUT SELECT INTERIOR CONCEPTS
Select Interior Concepts is a premier installer and nationwide
distributor of interior building products with leading market
positions in highly attractive markets. Headquartered in Atlanta,
Georgia, Select Interior Concepts is listed on the NASDAQ. The
Residential Design Services segment provides integrated design,
sourcing and installation solutions to customers, in the selection
of a broad array of interior products and finishes, including
flooring, cabinets, countertops, window treatments, and related
interior items. The Architectural Surfaces Group segment
distributes natural and engineered stone through a national network
of distribution centers and showrooms under proprietary brand names
such as AG&M, Modul and Pental. For more information, visit:
www.selectinteriorconcepts.com.
FORWARD-LOOKING STATEMENTS
This press release includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and, as such, may involve known and unknown risks,
uncertainties and assumptions. Forward-looking statements may be
identified by the use of words such as “anticipate,” “believe,”
“estimate,” “intend,” “could,” “should,” “would,” “may,” “seek,”
“plan,” “might,” “will,” “expect,” “predict,” “project,”
“forecast,” “potential,” “continue,” and other forms of these words
or similar words or expressions or the negatives thereof.
Forward-looking statements are based on historical information
available at the time the statements are made and are based on
management’s reasonable belief or expectations with respect to
future events. Forward-looking statements are subject to risks,
uncertainties, and other factors, including, but not limited to,
risks and uncertainties relating to the COVID 19 pandemic
(including those contained in our Form 8-K filed on May 5, 2020)
and those factors contained in our Annual Report on Form 10-K for
the fiscal year ended December 31, 2019 (our “Annual Report”) and
the other reports we file with the SEC, that may cause the
Company’s actual results, level of activity, performance or
achievement to be materially different from the results or plans
expressed or implied by such forward-looking statements. All
forward-looking statements in this press release are qualified by
the factors, risks and uncertainties contained in our Annual
Report. Forward-looking statements should not be read as a
guarantee of future performance or results, and will not
necessarily be accurate indications of the times at or by which
such performance or results will be achieved. Forward-looking
statements speak only as of the date on which they are made and the
Company undertakes no obligation to update any forward-looking
statement to reflect future events, developments or otherwise,
except as may be required by applicable law.
USE OF NON-GAAP FINANCIAL
MEASURES
This press release and the schedules hereto
include EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, and
adjusted operating expense, which are financial measures that have
not been calculated in accordance with accounting principles
generally accepted in the United States, or GAAP, and are therefore
referred to as non-GAAP financial measures. We have provided
definitions below for these non-GAAP financial measures and have
provided tables in the schedules hereto to reconcile these non-GAAP
financial measures to the comparable GAAP financial measures.
We believe that these non-GAAP financial
measures provide valuable information regarding our earnings and
business trends by excluding specific items that we believe are not
indicative of the ongoing operating results of our businesses,
providing a useful way for investors to make a comparison of our
performance over time and against other companies in our
industry.
We have provided these non-GAAP financial
measures as supplemental information to our GAAP financial measures
and believe these non-GAAP measures provide investors with
additional meaningful financial information regarding our operating
performance and cash flows. Our management and board of directors
also use these non-GAAP measures as supplemental measures to
evaluate our businesses and the performance of management,
including the determination of performance-based compensation, to
make operating and strategic decisions, and to allocate financial
resources. We believe that these non-GAAP measures also provide
meaningful information for investors and securities analysts to
evaluate our historical and prospective financial performance.
These non-GAAP measures should not be considered a substitute for
or superior to GAAP results. Furthermore, the non-GAAP measures
presented by us may not be comparable to similarly titled measures
of other companies.
CONTACTS:
Investor Relations:Tully Brown(470)
548-7370IR@selectinteriorconcepts.com
Select Interior Concepts,
Inc.Condensed Consolidated Balance Sheets
(Unaudited)
(In
thousands) |
|
June 30, 2020 |
|
December 31, 2019 |
ASSETS |
|
|
|
|
Cash |
|
$ |
2,936 |
|
|
$ |
5,002 |
|
Accounts receivable, net |
|
|
58,201 |
|
|
|
63,419 |
|
Inventories |
|
|
99,743 |
|
|
|
104,741 |
|
Prepaid expenses and other
current assets |
|
|
14,608 |
|
|
|
11,083 |
|
Income taxes receivable |
|
|
5,134 |
|
|
|
2,184 |
|
Total current assets |
|
$ |
180,622 |
|
|
$ |
186,429 |
|
Property and equipment, net |
|
|
24,453 |
|
|
|
26,494 |
|
Deferred tax assets, net |
|
|
10,222 |
|
|
|
10,550 |
|
Goodwill |
|
|
99,789 |
|
|
|
99,789 |
|
Customer relationships, net |
|
|
67,345 |
|
|
|
71,989 |
|
Other intangible assets, net |
|
|
17,036 |
|
|
|
18,759 |
|
Other assets |
|
|
5,295 |
|
|
|
6,265 |
|
Total assets |
|
$ |
404,762 |
|
|
$ |
420,275 |
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY |
|
|
|
|
Accounts payable |
|
|
49,118 |
|
|
|
42,734 |
|
Accrued expenses and other
current liabilities |
|
|
15,328 |
|
|
|
16,661 |
|
Customer deposits |
|
|
10,674 |
|
|
|
8,627 |
|
Current portion of long-term
debt, net |
|
|
360 |
|
|
|
11,749 |
|
Current portion of capital lease
obligations |
|
|
2,618 |
|
|
|
2,395 |
|
Total current liabilities |
|
$ |
78,098 |
|
|
$ |
82,166 |
|
Line of credit |
|
|
9,319 |
|
|
|
21,871 |
|
Long-term debt, net
of current portion and financing fees |
|
149,951 |
|
|
|
141,299 |
|
Long-term capital lease
obligations |
|
|
6,179 |
|
|
|
6,907 |
|
Other long-term liabilities |
|
|
6,404 |
|
|
|
6,757 |
|
Total liabilities |
|
$ |
249,951 |
|
|
$ |
259,000 |
|
Class A common stock |
|
|
255 |
|
|
|
251 |
|
Treasury stock, at cost |
|
|
(1,095 |
) |
|
|
(391 |
) |
Additional paid-in capital |
|
|
162,813 |
|
|
|
161,396 |
|
Retained earnings (accumulated
deficit) |
|
|
(7,162 |
) |
|
|
19 |
|
Total stockholders' equity |
|
$ |
154,811 |
|
|
$ |
161,275 |
|
Total liabilities and stockholders' equity |
|
$ |
404,762 |
|
|
$ |
420,275 |
|
Select Interior Concepts,
Inc.Condensed Consolidated Statement of Operations
(Unaudited)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
2020 |
|
|
|
2019 |
|
(in thousands, except
share data) |
|
|
|
|
|
|
|
|
|
Revenues,
net |
|
$ |
125,442 |
|
|
$ |
158,342 |
|
|
$ |
259,820 |
|
|
$ |
295,262 |
|
Cost of revenues |
|
|
94,742 |
|
|
|
114,174 |
|
|
|
198,427 |
|
|
|
212,361 |
|
Gross
profit |
|
|
30,700 |
|
|
|
44,168 |
|
|
|
61,393 |
|
|
|
82,901 |
|
Selling, general and
administrative expenses |
|
|
30,737 |
|
|
|
37,418 |
|
|
|
63,403 |
|
|
|
72,885 |
|
Income (loss) from
operations |
|
|
(37 |
) |
|
|
6,750 |
|
|
|
(2,010 |
) |
|
|
10,016 |
|
Other
expense: |
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
3,632 |
|
|
|
4,480 |
|
|
|
7,527 |
|
|
|
8,809 |
|
Other expense (income), net |
|
|
(34 |
) |
|
|
995 |
|
|
|
1,343 |
|
|
|
(720 |
) |
Total other expense,
net |
|
|
3,598 |
|
|
|
5,475 |
|
|
|
8,870 |
|
|
|
8,089 |
|
Income (loss)
before provision (benefit) for income taxes |
|
(3,635 |
) |
|
|
1,275 |
|
|
|
(10,880 |
) |
|
|
1,927 |
|
Provision (benefit) for income
taxes |
|
|
(456 |
) |
|
|
113 |
|
|
|
(3,699 |
) |
|
|
638 |
|
Net income
(loss) |
|
$ |
(3,179 |
) |
|
$ |
1,162 |
|
|
$ |
(7,181 |
) |
|
$ |
1,289 |
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share
of common stock |
|
|
|
|
|
|
|
|
|
Basic common stock |
|
$ |
(0.13 |
) |
|
$ |
0.05 |
|
|
$ |
(0.28 |
) |
|
$ |
0.05 |
|
Diluted common stock |
|
$ |
(0.13 |
) |
|
$ |
0.05 |
|
|
$ |
(0.28 |
) |
|
$ |
0.05 |
|
Weighted average shares
outstanding |
|
|
|
|
|
|
|
|
|
Basic common stock |
|
|
25,328,649 |
|
|
|
25,289,041 |
|
|
|
25,260,425 |
|
|
|
25,526,332 |
|
Diluted common stock |
|
|
25,328,649 |
|
|
|
25,383,843 |
|
|
|
25,260,425 |
|
|
|
25,603,663 |
|
Select Interior Concepts,
Inc.Condensed Consolidated Statements of Cash
Flows (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
Three Months Ended June 30, |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
2020 |
|
|
|
2019 |
|
(in
thousands) |
|
|
|
|
|
|
|
|
Net cash provided by (used in) operating
activities |
|
$ |
17,560 |
|
|
$ |
8,804 |
|
|
$ |
9,733 |
|
|
$ |
(1,747 |
) |
|
|
|
|
|
|
|
|
|
Purchase of property and
equipment |
|
|
(2,436 |
) |
|
|
(3,475 |
) |
|
|
(1,065 |
) |
|
|
(1,595 |
) |
Proceeds from disposal of
property and equipment |
|
|
22 |
|
|
|
11 |
|
|
|
7 |
|
|
|
2 |
|
Acquisition of Intown Design,
Inc. |
|
|
- |
|
|
|
(11,537 |
) |
|
|
- |
|
|
|
(875 |
) |
Escrow release payment related to
acquisition of Greencraft Holdings, LLC |
|
|
- |
|
|
|
(3,000 |
) |
|
|
- |
|
|
|
- |
|
Acquisition of Elegant Home
Design, LLC (Indemnity payment in 2019) |
|
|
- |
|
|
|
(1,000 |
) |
|
|
- |
|
|
|
- |
|
Net cash used in investing activities |
|
$ |
(2,414 |
) |
|
$ |
(19,001 |
) |
|
$ |
(1,058 |
) |
|
$ |
(2,468 |
) |
|
|
|
|
|
|
|
|
|
Payment of Greencraft Holdings,
LLC earn-out liability |
|
|
- |
|
|
|
(5,794 |
) |
|
|
- |
|
|
|
(5,794 |
) |
Proceeds from ERP financing |
|
|
376 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Proceeds from (payments on) line
of credit, net |
|
|
(12,601 |
) |
|
|
(839 |
) |
|
|
(39,535 |
) |
|
|
6,281 |
|
Proceeds from term loan |
|
|
- |
|
|
|
11,500 |
|
|
|
- |
|
|
|
- |
|
Term loan deferred issuance
costs |
|
|
(2,231 |
) |
|
|
- |
|
|
|
(2,000 |
) |
|
|
- |
|
Purchase of treasury stock |
|
|
(704 |
) |
|
|
(8 |
) |
|
|
(49 |
) |
|
|
(8 |
) |
Payments on notes payable and
capital leases |
|
|
(1,527 |
) |
|
|
(793 |
) |
|
|
(822 |
) |
|
|
(405 |
) |
Principal payments on long-term
debt |
|
|
(525 |
) |
|
|
(1,326 |
) |
|
|
(262 |
) |
|
|
(1,064 |
) |
Net cash provided by (used in) financing
activities |
|
$ |
(17,212 |
) |
|
$ |
2,740 |
|
|
$ |
(42,668 |
) |
|
$ |
(990 |
) |
|
|
|
|
|
|
|
|
|
Net decrease in
cash |
|
$ |
(2,066 |
) |
|
$ |
(7,457 |
) |
|
$ |
(33,993 |
) |
|
$ |
(5,205 |
) |
Cash (and restricted cash in
2019), beginning of period |
|
$ |
5,002 |
|
|
$ |
9,362 |
|
|
$ |
36,929 |
|
|
$ |
7,110 |
|
Cash, end of period |
|
$ |
2,936 |
|
|
$ |
1,905 |
|
|
$ |
2,936 |
|
|
$ |
1,905 |
|
|
|
|
|
|
|
|
|
|
Select Interior Concepts,
Inc.Segment Information (Unaudited)
|
|
Three Months Ended June 30, 2020 |
|
|
|
Six Months Ended June 30, 2020 |
(in
thousands) |
Net Sales |
|
Gross Profit |
|
Gross Margin |
|
(in
thousands) |
Net Sales |
|
Gross Profit |
|
Gross Margin |
RDS |
|
$ |
73,449 |
|
|
$ |
17,506 |
|
|
23.8 |
% |
|
RDS |
|
$ |
152,799 |
|
|
$ |
34,972 |
|
|
22.9 |
% |
ASG |
|
|
52,464 |
|
|
|
13,360 |
|
|
25.5 |
% |
|
ASG |
|
|
108,007 |
|
|
|
26,577 |
|
|
24.6 |
% |
Elims/Corp |
|
|
(471 |
) |
|
|
(166 |
) |
|
n/a |
|
Elims/Corp |
|
|
(986 |
) |
|
|
(156 |
) |
|
n/a |
Total |
|
$ |
125,442 |
|
|
$ |
30,700 |
|
|
24.5 |
% |
|
Total |
|
$ |
259,820 |
|
|
$ |
61,393 |
|
|
23.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2019 |
|
|
|
Six Months Ended June 30, 2019 |
|
|
Net Sales |
|
Gross Profit |
|
Gross Margin |
|
|
|
Net Sales |
|
Gross Profit |
|
Gross Margin |
RDS |
|
$ |
92,812 |
|
|
$ |
25,805 |
|
|
27.8 |
% |
|
RDS |
|
$ |
172,797 |
|
|
$ |
48,446 |
|
|
28.0 |
% |
ASG |
|
|
66,346 |
|
|
|
18,353 |
|
|
27.7 |
% |
|
ASG |
|
|
123,851 |
|
|
|
34,374 |
|
|
27.8 |
% |
Elims/Corp |
|
|
(816 |
) |
|
|
10 |
|
|
n/a |
|
Elims/Corp |
|
|
(1,386 |
) |
|
|
80 |
|
|
n/a |
Total |
|
$ |
158,342 |
|
|
$ |
44,168 |
|
|
27.9 |
% |
|
Total |
|
$ |
295,262 |
|
|
$ |
82,900 |
|
|
28.1 |
% |
Select Interior Concepts,
Inc.Reconciliation of Net Income to EBITDA and
Adjusted EBITDA (Unaudited)
(in
thousands) |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
Reconciliation of net income to Adj. EBITDA |
|
2020 |
|
|
|
2019 |
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
Consolidated net income (loss) |
|
$ |
(3,179 |
) |
|
$ |
1,162 |
|
$ |
(7,181 |
) |
|
$ |
1,289 |
|
Income tax expense (benefit) |
|
|
(456 |
) |
|
|
113 |
|
|
(3,699 |
) |
|
|
638 |
|
Interest expense |
|
|
3,632 |
|
|
|
4,480 |
|
|
7,527 |
|
|
|
8,809 |
|
Depreciation and
amortization |
|
|
5,723 |
|
|
|
6,432 |
|
|
11,367 |
|
|
|
12,681 |
|
EBITDA |
|
$ |
5,720 |
|
|
$ |
12,187 |
|
$ |
8,014 |
|
|
$ |
23,417 |
|
|
|
|
|
|
|
|
|
|
Equity-based compensation |
|
|
1,223 |
|
|
|
1,426 |
|
|
554 |
|
|
|
1,988 |
|
Purchase accounting
fair value adjustments |
|
- |
|
|
|
959 |
|
|
- |
|
|
|
(563 |
) |
Acquisition and
integration related costs |
|
(86 |
) |
|
|
751 |
|
|
1,366 |
|
|
|
2,205 |
|
Employee related reorganization
costs |
|
|
1,274 |
|
|
|
247 |
|
|
1,481 |
|
|
|
686 |
|
Other non-recurring costs |
|
|
1,590 |
|
|
|
159 |
|
|
2,269 |
|
|
|
507 |
|
Strategic alternatives costs |
|
|
652 |
|
|
|
890 |
|
|
1,227 |
|
|
|
890 |
|
Total
addbacks |
|
$ |
4,653 |
|
|
$ |
4,432 |
|
$ |
6,897 |
|
|
$ |
5,713 |
|
Adjusted
EBITDA |
|
$ |
10,373 |
|
|
$ |
16,619 |
|
$ |
14,911 |
|
|
$ |
29,130 |
|
Select Interior Concepts,
Inc.Reconciliation of Operating Expenses to
Adjusted Operating Expenses
(Unaudited)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
(in thousands) |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
|
|
|
|
|
|
|
Operating expenses |
|
$ |
30,737 |
|
$ |
37,418 |
|
$ |
63,403 |
|
$ |
72,885 |
Equity-based compensation |
|
|
1,223 |
|
|
1,426 |
|
|
554 |
|
|
1,988 |
Acquisition and integration
related costs |
|
|
1 |
|
|
544 |
|
|
76 |
|
|
1,998 |
Employee related reorganization
costs |
|
|
1,153 |
|
|
247 |
|
|
1,359 |
|
|
686 |
Other non-recurring costs |
|
|
1,292 |
|
|
159 |
|
|
1,942 |
|
|
507 |
Strategic alternatives costs |
|
|
652 |
|
|
890 |
|
|
1,227 |
|
|
890 |
Total adjustments to
operating expenses |
|
$ |
4,321 |
|
$ |
3,266 |
|
$ |
5,158 |
|
$ |
6,069 |
Adjusted operating
expenses |
|
$ |
26,416 |
|
$ |
34,152 |
|
$ |
58,245 |
|
$ |
66,816 |
EBITDA is defined as consolidated net income before interest,
taxes and depreciation and amortization.
Adjusted EBITDA is defined as consolidated net income before (i)
interest expense, (ii) income tax expense, (iii) depreciation and
amortization expense, (iv) stock compensation expense, and (v)
adjustments for costs that are deemed to be transitional in nature
or not related to our core operations, such as severance and
employee related reorganization costs, purchase accounting fair
value adjustments, strategic alternatives costs, facility closure
costs, and professional, financing and legal fees related to
business acquisitions, or similar transitional costs and expenses
related to business investments, greenfield investments, and
integrating acquired businesses into our Company.
Adjusted EBITDA margin is Adjusted EBITDA as a percentage of net
sales.
Adjusted operating expense is defined as consolidated operating
expense before stock compensation expense, and adjustments for
costs that are deemed to be transitional in nature or not related
to our core operations, such as severance and employee related
reorganization costs, strategic alternatives costs, facility
closure costs, and professional, financing and legal fees related
to business acquisitions, or similar transitional costs and
expenses related to business investments, greenfield investments,
and integrating acquired businesses into our Company.
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