Systemax, Inc. (SYX) Tops Q3 EPS by 5c, Revenues Beat

Systemax, Inc. (NYSE: SYX) reported Q3 EPS of $0.39, $0.05 better than the analyst estimate of $0.34. Revenue for the quarter came in at $235.8 million versus the consensus estimate of $230.97 million.

Third Quarter 2018 Financial Summary:

• Consolidated sales increased 15.4% to $235.8 million in U.S. dollars. On a constant currency basis, average daily sales increased 15.6%.
• Consolidated operating income grew 47.2% to $18.4 million compared to $12.5 million last year on a GAAP basis. On a Non-GAAP basis, consolidated operating income grew 45.2% to $19.6 million.
• Net income per diluted share from continuing operations grew 33.3% to $0.40. Non-GAAP net income per diluted share from continuing operations grew 69.6% to $0.39.
• Net income per diluted share from discontinued operations was $4.32, primarily related to the $160.0 million book gain recognized on the sale of the Company\'s France business and the inclusion of the 2018 France operating results in discontinued operations for the third quarter of 2018.

Larry Reinhold, Chief Executive Officer, said, "In the third quarter, our Industrial Products Group delivered an all-time record performance. Sales increased over 15% organically compared to the third quarter of last year, and the rate of sales growth has accelerated for five consecutive quarters. Demand was robust across the business with solid performance in our managed sales channels, as well as continued generation of new customers through our leading e-commerce platform. Operating leverage remains healthy, with segment operating margin above 10% for the second consecutive quarter and expanded from the third quarter of last year. We saw no material impact on the business or profitability from tariffs in the quarter."

"The sale of our France business in August generated gross proceeds of almost $270 million dollars, before taxes and transaction costs, and marked the completion of the strategic restructuring of our operations. Today, we are focused on driving profitable growth within the Industrial Products Group, which is a healthy and high performing business that has delivered consistent double-digit organic revenue increases for many years. Industrial has significantly expanded its operations, improved its profitability dramatically, and has multiple growth opportunities in its future. It is uniquely positioned to serve the SMB market and we are making investments to further enhance its competitive position and expand the value we bring to customers. With strong cash flow generation and an exceptional balance sheet we have significant financial flexibility to capitalize on our growth opportunities, pursue strategic M&A and return capital to our shareholders."

For earnings history and earnings-related data on Systemax, Inc. (SYX) click here.

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