SAN ANTONIO--(BUSINESS WIRE)-- XPEL, Inc. (Nasdaq: XPEL), a global provider of protective films and coatings, announced results for the fourth quarter and year ended December 31, 2019.

Fourth Quarter 2019 Highlights:

• Revenues increased 47.4% to $39.5 million compared to fourth quarter 2018
• Net Income of $4.6 million compared to $1.9 million in the same quarter of 2018
• EBITDA increased to $5.6million compared to $2.9 million in fourth quarter 2018

Full Year 2019 Highlights:

• Revenues increased 18.2% to $129.9 million compared to full year 2018
• Gross margin improved to 34.5% compared to 30.4% for full year 2018
• Earnings per share of $0.51 compared to $0.32 per share in 2018

Ryan Pape, President and Chief Executive Officer of XPEL, commented, “We closed 2019 on a strong note, delivering another quarter of record revenues, enhanced profitability and significant EBITDA growth to cap our best year ever.”

China revenue in Q1 has been significantly negatively impacted by COVID-19. The Company believes the impact of COVID-19 will begin to diminish in the China market in the second quarter. The Company is monitoring the impact of COVID-19 in other markets, including Europe and the United States. To date in the first quarter, the Company has seen strong performance in both the United States and Europe.

For the Quarter Ended December 31, 2019:

Revenues. Revenues increased approximately $12.7 million or 47.4% to $39.5 million as compared to $26.8 million in the prior year.

Gross Margin. Gross margin was 31.5%, essentially flat compared to 31.4% in the fourth quarter of 2018.

Expenses. Selling, general and administrative expenses increased to $7.5 million but declined as a percentage of sales to 18.9% as compared to $5.8 million or 21.8% of sales in the prior year period.

Net income. Net income increased to $4.6 million, or $0.17 per basic and diluted share versus net income of $1.9 million, or $0.07 per basic and diluted share in the fourth quarter of 2018.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) increased to $5.6 million, or 14.1% of sales, as compared to $2.9 million in the prior year1.

For the Year Ended December 31, 2019:

Revenues. Revenues increased approximately $20.0 million or 18.2% to $129.9 million as compared to $109.9 million in the prior year.

Gross Margin. Gross margin was 33.5% versus 30.4% for full year 2018.

Expenses. Selling, general and administrative expenses increased to $26.4 million or 20.3% of sales as compared to $21.6 million or 19.7% of sales in the prior year.

Net income. Net income increased to $14.0 million, or $0.51 per basic and diluted share versus net income of $8.7 million, or $0.32 per basic and diluted share for 2018.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) increased to $18.7 million, or 14.4% of sales, as compared to $13.0 million in the prior year2.

As of December 31, 2019 XPEL had cash and cash equivalents of $11.5 million compared to $4.0 million at December 31, 2018. Total stockholders’ equity at December 31, 2019 was $35.9 million compared to $20.6 million at December 31, 2018.

Conference Call Information

The Company will host a conference call and webcast today, Monday, March 16, 2020 at 11:00 a.m. Eastern Time to discuss the Company’s results for the fourth quarter and full year 2020.

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) 407-8033 approximately five minutes prior to the scheduled start time. International callers please dial (201) 689-8033.

A replay of the teleconference will be available until April 16, 2020 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 33406.

About XPEL, Inc.

XPEL is a leading provider of protective films and coatings, including automotive paint protection film, surface protection film, automotive and commercial/residential 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.

XPEL Inc.
Consolidated Statements of Income
		Three Months Ended December 31,											Year Ended December 31,
		2019						2018					2019					2018
Revenue
Product revenue		$	34,909,276					$	23,027,479				$	112,204,739				$		95,526,350
Service revenue			4,586,007						3,765,400					17,728,142						14,394,264
Total revenue			39,495,283						26,792,879					129,932,881						109,920,614
Cost of Sales
Cost of product sales			25,785,422						17,624,227					82,308,256						73,656,389
Cost of service			1,252,725						752,571					4,118,366						2,827,620
Total cost of sales			27,038,147						18,376,798					86,426,622						76,484,009
Gross Margin			12,457,136						8,416,081					43,506,259						33,436,605
Operating Expenses
Sales and marketing			2,115,397						1,867,047					7,584,377						6,802,241
General and administrative			5,367,845						3,970,547					18,834,535						14,828,361
Total operating expenses			7,483,242						5,837,594					26,418,912						21,630,602
Operating Income			4,973,894						2,578,487					17,087,347						11,806,003
Interest expense			15,015						33,004					96,646						168,389
Foreign currency exchange (gain) loss			(111,586	)					47,634					40,273						156,309
Income before income taxes			5,070,465						2,497,849					16,950,428						11,481,305
Income tax expense			451,991						600,477					2,955,356						2,760,073
Net income			4,618,474						1,897,372					13,995,072						8,721,232
Income attributed to non-controlling interest			8,136						3,498					17,447						8,698
Net income attributable to stockholders of the Company		$	4,610,338					$	1,893,874				$	13,977,625				$		8,712,534
Earnings per share attributable stockholders of the Company
Basic and diluted		$	0.17					$	0.07				$	0.51				$		0.32
Weighted Average Number of Common Shares
Basic and diluted			27,612,597						27,612,597					27,612,597						27,612,597

XPEL Inc.
Consolidated Balance Sheets
		December 31, 2019						December 31, 2018
Assets
Current
Cash and cash equivalents		$	11,500,973					$	3,971,226
Accounts receivable, net			7,154,084						5,554,313
Inventory, net			15,141,153						10,799,611
Prepaid expenses and other current assets			2,391,340						706,718
Income tax receivable			93,150						—
Total current assets			36,280,700						21,031,868
Property and equipment, net			4,014,653						3,384,206
Right-of-Use lease assets			5,079,110						—
Intangible assets, net			3,820,460						3,804,026
Goodwill			2,406,512						2,322,788
Total assets		$	51,601,435					$	30,542,888
Liabilities
Current
Current portion of notes payable		$	462,226					$	853,150
Current portion lease liabilities			1,126,701						—
Accounts payable and accrued liabilities			10,197,353						6,292,093
Income tax payable			—						1,337,599
Total current liabilities			11,786,280						8,482,842
Deferred tax liability, net			604,715						478,864
Non-current portion of lease liabilities			4,009,949						—
Non-current portion of notes payable			307,281						968,237
Total liabilities			16,708,225						9,929,943
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 outstanding			27,613						27,613
Additional paid-in-capital			11,348,163						11,348,163
Accumulated other comprehensive loss			(908,764	)					(1,190,055	)
Retained earnings			24,594,878						10,617,253
			35,061,890						20,802,974
Non-controlling interest			(168,680	)					(190,029	)
Total stockholders’ equity			34,893,210						20,612,945
Total liabilities and stockholders’ equity		$	51,601,435					$	30,542,888

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
		Three Months Ended December 31,										Year Ended December 31,
		2019					2018					2019					2018
Net Income		$	4,618,474				$	1,897,372				$	13,995,072				$	8,721,232
Interest			15,015					33,004					96,646					168,389
Taxes			451,991					600,477					2,955,356					2,760,073
Depreciation			260,533					196,604					915,918					735,983
Amortization			210,151					170,126					781,105					642,801
EBITDA		$	5,556,164				$	2,897,583				$	18,744,097				$	13,028,478

1See reconciliation of non-GAAP financial measures below.
2See reconciliation of non-GAAP financial measures below.

View source version on businesswire.com: https://www.businesswire.com/news/home/20200316005223/en/

Investor Relations:

John Nesbett/Jennifer Belodeau

IMS Investor Relations

Phone: (203) 972-9200

Email: [email protected]

Source: XPEL, Inc.

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