Select Interior Concepts (SIC) Misses Q1 EPS by 7c, Slight Miss on Revenues

Select Interior Concepts (NASDAQ: SIC) reported Q1 EPS of ($0.16), $0.07 worse than the analyst estimate of ($0.09). Revenue for the quarter came in at $134.4 million versus the consensus estimate of $134.6 million.

FIRST QUARTER 2020 FINANCIAL HIGHLIGHTS COMPARED TO FIRST QUARTER 2019

• Consolidated net sales of $134.4 million, compared to $136.9 million
• Gross profit was $30.7 million, compared to $38.7 million
• Net loss was ($4.0 million), or ($0.16) EPS, compared to net income of $0.1 million, or $0.00 EPS
• EBITDA of $2.3 million, compared to $11.2 million
• Adjusted EBITDA of $4.5 million, compared to $12.5 million
• Operating cash flow totaled $7.8 million, compared to $10.6 million
• Liquidity of $72.2 million, including $36.9 million of cash plus $35.3 million of availability under the revolving credit facility
• Taking wide range of actions in response to the COVID-19 pandemic, including an estimated $14-$16 million of 2020 cost savings

Tyrone Johnson, Chief Executive Officer of Select Interior Concepts, stated, “As an essential business, we are committed to the health and well-being of our employees and communities while safely and responsibly serving customers during this unprecedented COVID-19 pandemic. During the quarter we recorded strong volume gains driven by encouraging project activity to start the year, though the continuing mix-shift to entry level and mid-priced homes for our residential design and installation services business adversely impacted our results. In light of these dynamics, we are rationalizing costs, managing working capital, improving processes and leveraging technology to generate additional efficiencies in our business. During the quarter we lowered operating expenses as a percentage of net sales and generated operating cash flow in excess of Adjusted EBITDA.”

Mr. Johnson continued, “Although we experienced limited economic disruptions related to COVID-19 in the first quarter, the impact was more pronounced in April, where we saw a 25% decline in sales year-over-year. We entered the second quarter with a significant liquidity position of approximately $70 million, and we have enacted sizeable cost savings to further improve our cost and cash position, resulting in positive Adjusted EBITDA for April. Although the second quarter is expected to be challenging given the unclear pace of the ultimate economic recovery, our flexible cost structure, recent austerity measures and strengthened liquidity position collectively provide us with a solid foundation to profitably grow as economies recover.”

For earnings history and earnings-related data on Select Interior Concepts (SIC) click here.

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