Close

Form 8-K XPEL, Inc. For: Aug 09

August 9, 2022 9:16 AM EDT

Get instant alerts when news breaks on your stocks. Claim your 1-week free trial to StreetInsider Premium here.
false000176725800017672582022-08-092022-08-09

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
August 9, 2022
Date of Report (date of earliest event reported)
XPEL, INC.
(Exact name of registrant as specified in its charter)
Nevada001-3885820-1117381
(State or other jurisdiction of incorporation or organization)(Commission File Number)(I.R.S. Employer Identification No.)
3251 I-3578219
San AntonioTexas
(Address of Principal Executive Offices)(Zip Code)
Registrant's telephone number, including area code: (210) 678-3700
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.001 per shareXPELThe Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.





Item 2.02 Results of Operations and Financial Condition
 
On August 9, 2022, XPEL, Inc. (“XPEL”) announced its consolidated financial results for the three and six months ended June 30, 2022. A copy of the press release is attached as Exhibit 99.1 to this current report on Form 8-K, and the information set forth therein is incorporated herein by reference and constitutes a part of this report.

The information contained in Item 2.02 of this report and Exhibit 99.1 to this report shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be incorporated by reference into any filings made by XPEL under the Securities Act of 1933, as amended, or the Exchange Act, except as may be expressly set forth by specific reference in such filing.

  Item 9.01. Financial Statements and Exhibits
 
    (d) Exhibits

The following exhibit is to be filed as part of this Form 8-K:

EXHIBIT NO.IDENTIFICATION OF EXHIBIT
99.1
 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
XPEL, Inc.
Dated: August 9, 2022By: /s/ Barry R. Wood
Barry R. Wood
Senior Vice President and Chief Financial Officer


Ex. 99.1
XPEL Reports Record Revenue of $83.9 Million in Second Quarter 2022; Revenue Growth 22.0%; Gross Margin 39.3%; EBITDA Margin 20.5%

San Antonio, TX – August 9, 2022– XPEL, Inc. (Nasdaq: XPEL) a global provider of protective films and coatings, today announced results for the second quarter and six months ended June 30, 2022.

Second Quarter 2022 Highlights:

Revenues increased 22.0% to a record $83.9 million in the second quarter.

Gross margin percentage improved to 39.3% in the second quarter, a new high for the Company.

Net income grew 16.8% to $11.9 million, or $0.43 per share, compared to $10.2 million, or $0.37 per share, in the same quarter of 2021.

EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) grew 26.6% to $17.2 million, or 20.5% of revenues compared to $13.6 million in second quarter 2021.1


First Six Months Highlights:

Revenues increased 29.1% to $155.8 million in the first six months of 2022.

Gross margin percentage improved to 39.0% in the first half of 2022.

Net income grew 15.7% to $19.7 million, or $0.71 per share, compared to $17.0 million, or $0.62 per share, in the first six months of 2021.

EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) grew 27.8% to $29.1 million, or 18.7% of revenues compared to $22.7 million in the first half of 2021.1

Ryan Pape, President and Chief Executive Officer of XPEL, commented, “We’re pleased to have delivered strong second quarter results, especially in the face of continuing headwinds related to on-going tight new car inventory, COVID-related impacts in China and the strengthening U.S. Dollar. We continued to see robust demand for our products and services across most of our regions. We remain confident in our ability to drive continued strong performance in the second half of 2022.”



For the Quarter Ended June 30, 2022:

Revenues. Revenues increased approximately $15.2 million or 22.0% to $83.9 million as compared to $68.7 million in the second quarter of the prior year.

Gross Margin. Gross margin was 39.3% compared to 36.7% in the second quarter of 2021.

Expenses. Operating expenses increased to $17.2 million, or 20.5% of sales, compared to $12.6 million, or 18.3% of sales in the prior year period.

Net income. Net income was $11.9 million, or $0.43 per basic and diluted share, versus net income of $10.2 million, or $0.37 per basic and diluted share in the second quarter of 2021.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was $17.2 million, or 20.5% of sales, as compared to $13.6 million, or 19.7% of sales in the prior year1.

For the Six Months Ended June 30, 2022:

Revenues. Revenues increased approximately $35.2 million or 29.1% to $155.8 million as compared to $120.6 million in the first six months of the prior year.

Gross Margin. Gross margin was 39.0% compared to 36.1% in the first half of 2021.

Expenses. Operating expenses increased to $34.9 million, or 22.4% of sales, compared to $22.3 million or 18.5% of sales in the prior year period.

Net income. Net income was $19.7 million, or $0.71 per basic and diluted share versus net income of $17.0 million, or $0.62 per basic and diluted share in the first six months of 2021.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was $29.1 million, or 18.7% of sales, as compared to $22.7 million, or 18.9% of sales in the prior year1.

1 See reconciliation of non-GAAP financial measures below


Conference Call Information

The Company will host a conference call and webcast today, August 9, 2022 at 11:00 a.m. Eastern Time to discuss the Company’s second quarter 2022 results.

To access the live webcast, please visit the XPEL, Inc. website at www.xpel.com/investor.

To participate in the call by phone, dial (877) 545-0320 approximately five minutes prior to the scheduled start time. International callers please dial (973) 528-0002. Callers should use access code: 929753.

A replay of the teleconference will be available until September 8, 2022 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 46173.



About XPEL, Inc.

XPEL is a leading provider of protective films and coatings, including automotive paint protection film, surface protection film, automotive and architectural window films, and ceramic coatings. With a global footprint, a network of trained installers and proprietary DAP software, XPEL is dedicated to exceeding customer expectations by providing high-quality products, leading customer service, expert technical support and world-class training. XPEL, Inc. is publicly traded on Nasdaq under the symbol “XPEL”.



Safe harbor statement

This release includes forward-looking statements regarding XPEL, Inc. and its business, which may include, but is not limited to, anticipated use of proceeds from capital transactions, expansion into new markets, and execution of the company's growth strategy. Often, but not always, forward-looking statements can be identified by the use of words such as "plans," "is expected," "expects," "scheduled," "intends," "contemplates," "anticipates," "believes," "proposes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may," "could," "would," "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations of the management of XPEL. The forward-looking events and circumstances discussed in this release may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the company, performance and acceptance of the company's products, economic factors, competition, the equity markets generally and many other factors beyond the control of XPEL. Although XPEL has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and XPEL undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

For more information, contact:
Investor Relations:
John Nesbett/Jennifer Belodeau
IMS Investor Relations
Phone: (203) 972-9200
Email: xpel@imsinvestorrelations.com





XPEL Inc.
Condensed Consolidated Statements of Income (Unaudited)
(In thousands except per share data)

Three Months Ended
June 30,
Six Months Ended
June 30,
2022202120222021
Revenue
Product revenue$67,040 $58,667 $125,137 $103,599 
Service revenue16,850 10,069 30,617 17,003 
Total revenue83,890 68,736 155,754 120,602 
Cost of Sales
Cost of product sales44,227 40,593 82,421 72,139 
Cost of service6,680 2,896 12,633 4,929 
Total cost of sales50,907 43,489 95,054 77,068 
Gross Margin32,983 25,247 60,700 43,534 
Operating Expenses
Sales and marketing5,906 4,687 12,218 8,075 
General and administrative11,328 7,888 22,696 14,240 
Total operating expenses17,234 12,575 34,914 22,315 
Operating Income15,749 12,672 25,786 21,219 
Interest expense322 44 542 97 
Foreign currency exchange (gain) loss457 (63)462 (28)
Income before income taxes14,970 12,691 24,782 21,150 
Income tax expense3,068 2,505 5,076 4,117 
Net income$11,902 $10,186 $19,706 $17,033 
Earnings per share
Basic$0.43 $0.37 $0.71 $0.62 
Diluted$0.43 $0.37 $0.71 $0.62 
Weighted Average Number of Common Shares
Basic27,613 27,613 27,613 27,613 
Diluted27,613 27,613 27,613 27,613 






XPEL Inc.
Condensed Consolidated Balance Sheets
(In thousands except per share data)

(Unaudited)(Audited)
June 30, 2022December 31, 2021
Assets
Current
Cash and cash equivalents$9,321 $9,644 
Accounts receivable, net19,119 13,159 
Inventory, net74,142 51,936 
Prepaid expenses and other current assets4,434 3,672 
Income tax receivable550 617 
Total current assets107,566 79,028 
Property and equipment, net12,169 9,898 
Right-of-use lease assets13,580 12,910 
Intangible assets, net29,777 32,733 
Other non-current assets893 791 
Goodwill25,071 25,655 
Total assets$189,056 $161,015 
Liabilities
Current
Current portion of notes payable159375
Current portion lease liabilities3,6732,978
Accounts payable and accrued liabilities36,58732,915
Total current liabilities40,41936,268
Deferred tax liability, net2,4122,748
Other long-term liabilities1,1402,631
Borrowings on line of credit32,00025,000
Non-current portion of lease liabilities10,008 9,830
Non-current portion of notes payable— 76 
Total liabilities85,979 76,553 
Commitments and Contingencies (Note 11)
Stockholders’ equity
Preferred stock, $0.001 par value; authorized 10,000,000; none issued and outstanding— — 
Common stock, $0.001 par value; 100,000,000 shares authorized; 27,612,597 issued and outstanding28 28 
Additional paid-in-capital10,760 10,581 
Accumulated other comprehensive loss(1,860)(590)
Retained earnings94,149 74,443 
Total stockholders’ equity103,077 84,462 
Total liabilities and stockholders’ equity$189,056 $161,015 





Reconciliation of Non-GAAP Financial Measure

EBITDA is a non-GAAP financial measure. EBITDA is defined as net income (loss) plus interest expense, net, plus income tax expense plus depreciation expense and amortization expense. EBITDA should be considered in addition to, not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. It is not a measurement of our financial performance under GAAP and should not be considered as alternatives to revenue or net income, as applicable, or any other performance measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other businesses. EBITDA has limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our operating results as reported under GAAP.

EBITDA does not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of ongoing operations and other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure.



EBITDA Reconciliation
(In thousands)

(Unaudited)(Unaudited)
Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
Net Income$11,902 $10,186 $19,706 $17,033 
Interest322 44 542 97 
Taxes3,068 2,505 5,076 4,117 
Depreciation839 420 1,596 803 
Amortization1,054 423 2,131 685 
EBITDA$17,185 $13,578 $29,051 $22,735 





Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In





Related Categories

SEC Filings