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XPEL Reports Record Revenue of $70.1 Million in Fourth Quarter 2021; Fourth Quarter Revenue Increase of 44.3%; Full Year Revenue Increase of 63.1%

XPEL, Inc. (Nasdaq: XPEL) (the "Company"), a global provider of protective films and coatings, announced results for the fourth quarter and year ended December 31, 2021.

Fourth Quarter 2021 Highlights:

  • Revenue increased 44.3% to $70.1 million compared to fourth quarter 2020. Organic revenue growth was 27.0%.
  • EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) grew 23.7% to $10.0 million, or 14.2% of revenue compared to $8.1 million, or 16.6% of revenue in fourth quarter 2020.1

Year End 2021 Highlights:

  • Revenue increased 63.1% to $259.3 million as compared to $158.9 million in the prior year. Organic revenue growth was 52.9%.
  • Net income increased by 72.7% to $31.6 million, or $1.14 per basic and diluted share, compared to $18.3 million, or $0.66 per basic and diluted share, in 2020.
  • EBITDA grew 74.5% to $44.1 million, or 17.0% of revenue, as compared to $25.3 million, or 15.9% in the prior year.1

In the quarter, the Company incurred negative operating margin impacts of $1.8 million in higher labor costs in its acquired Dealership Services division due to low new car inventory and $0.8 million in one-time costs resulting from inventory availability pursuant to a facility move which will reverse in 2022. Normalizing for these items, EBITDA would have been $12.6 million or 18% of revenue and gross margin as a percent of revenue would have been 38.9%.

Ryan Pape, President and Chief Executive Officer of XPEL, commented, “We are really proud of what has been an amazing year for the entire XPEL team. In addition to achieving record growth, we closed and integrated seven acquisitions that will set us up for success in 2022 particularly as new car inventory rebuilds through the year.”

For the Quarter Ended December 31, 2021:

Revenue. Revenue increased approximately $21.5 million, or 44.3%, to $70.1 million as compared to $48.6 million in the fourth quarter of the prior year.

Gross Margin. Gross margin was 35.2% compared to 32.8% in the fourth quarter of 2020.

Expenses. Operating expenses increased to $16.2 million, or 23.0% of revenue, compared to $8.6 million, or 17.7% of revenue in the prior year period.

Net income. Net income was $6.2 million, or $0.22 per basic and diluted share, versus net income of $6.1 million, or $0.22 per basic and diluted share in the fourth quarter of 2020.

EBITDA. EBITDA was $10.0 million, or 14.2% of revenue, compared to $8.1 million, or 16.6% of revenue in the fourth quarter of the prior year.1

For the Year Ended December 31, 2021:

Revenue. Revenue increased approximately $100.3 million, or 63.1%, to $259.3 million as compared to $158.9 million in the prior year.

Gross Margin. Gross margin was 35.7% compared to 34.0% for full year 2020.

Expenses. Operating expenses increased to $52.6 million, or 20.3% of revenue, compared to $30.7 million, or 19.3%, of revenue in full year 2020.

Net income. Net income was $31.6 million, or $1.14 per basic and diluted share, versus net income of $18.3 million, or $0.66 per basic and diluted share in full year 2020.

EBITDA. EBITDA was $44.1 million, or 17.0% of revenue, compared to $25.3 million, or 15.9% of revenue in the prior year.1

Conference Call Information

The Company will host a conference call and webcast today, February 28, 2022 at 11:00 a.m. Eastern Time to discuss the Company’s fourth quarter and year end 2021 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 888-506-0062 approximately five minutes prior to the scheduled start time. International callers please dial (973) 528-0011. Callers should use access code: 930015.

A replay of the teleconference will be available until March 30, 2022 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 44592.

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”.

1 See reconciliation of non-GAAP financial measures below

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

 

 

(Unaudited)

Three Months Ended December 31,

 

Year Ended December 31,

 

 

2021

 

 

2020

 

 

2019

 

 

2021

 

 

2020

 

 

2019

Revenue

 

 

 

 

 

 

 

 

 

 

 

Product revenue

$

56,687,599

 

$

42,021,771

 

$

34,909,276

 

$

217,282,531

 

$

136,262,067

 

$

112,204,739

Service revenue

 

13,444,470

 

 

6,585,560

 

 

4,586,007

 

 

41,980,546

 

 

22,662,381

 

 

17,728,142

Total revenue

 

70,132,069

 

 

48,607,331

 

 

39,495,283

 

 

259,263,077

 

 

158,924,448

 

 

129,932,881

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales

 

 

 

 

 

 

 

 

 

 

 

Cost of product sales

 

39,446,147

 

 

30,814,288

 

 

25,785,422

 

 

151,285,632

 

 

98,502,279

 

 

82,308,256

Cost of service

 

5,997,149

 

 

1,833,831

 

 

1,252,725

 

 

15,300,458

 

 

6,397,160

 

 

4,118,366

Total cost of sales

 

45,443,296

 

 

32,648,119

 

 

27,038,147

 

 

166,586,090

 

 

104,899,439

 

 

86,426,622

Gross Margin

 

24,688,773

 

 

15,959,212

 

 

12,457,136

 

 

92,676,987

 

 

54,025,009

 

 

43,506,259

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing

 

5,294,828

 

 

2,758,614

 

 

2,115,397

 

 

18,273,197

 

 

9,748,292

 

 

7,584,377

General and administrative

 

10,865,027

 

 

5,868,645

 

 

5,367,845

 

 

34,288,171

 

 

20,906,785

 

 

18,834,535

Total operating expenses

 

16,159,855

 

 

8,627,259

 

 

7,483,242

 

 

52,561,368

 

 

30,655,077

 

 

26,418,912

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income

 

8,528,918

 

 

7,331,953

 

 

4,973,894

 

 

40,115,619

 

 

23,369,932

 

 

17,087,347

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

159,582

 

 

76,000

 

 

15,015

 

 

302,674

 

 

249,480

 

 

96,646

Foreign currency exchange loss (gain)

 

251,443

 

 

(104,334)

 

 

(111,586)

 

 

372,974

 

 

316,093

 

 

40,273

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

8,117,893

 

 

7,360,287

 

 

5,070,465

 

 

39,439,971

 

 

22,804,359

 

 

16,950,428

Income tax expense

 

1,914,400

 

 

1,271,888

 

 

451,991

 

 

7,873,109

 

 

4,522,668

 

 

2,955,356

Net income

 

6,203,493

 

 

6,088,399

 

 

4,618,474

 

 

31,566,862

 

 

18,281,691

 

 

13,995,072

Income attributed to

non-controlling interest

 

 

 

 

 

8,136

 

 

 

 

 

 

17,447

Net income attributable to

stockholders of the Company

$

6,203,493

 

$

6,088,399

 

$

4,610,338

 

$

31,566,862

 

$

18,281,691

 

$

13,977,625

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share attributable

stockholders of the Company

 

 

 

 

 

 

 

 

 

 

 

Basic

$

0.22

 

$

0.22

 

$

0.17

 

$

1.14

 

$

0.66

 

$

0.51

Diluted

$

0.22

 

$

0.22

 

$

0.17

 

$

1.14

 

$

0.66

 

$

0.51

Weighted Average Number of

Common Shares

 

 

 

 

 

 

 

 

 

 

 

Basic

 

27,612,597

 

 

27,612,597

 

 

27,612,597

 

 

27,612,597

 

 

27,612,597

 

 

27,612,597

Diluted

 

27,612,597

 

 

27,612,597

 

 

27,612,597

 

 

27,612,729

 

 

27,612,597

 

 

27,612,597

XPEL, Inc.

Consolidated Balance Sheets

 

 

December 31,

2021

 

December 31,

2020

Assets

 

 

 

Current

 

 

 

Cash and cash equivalents

$

9,644,248

 

$

29,027,124

Accounts receivable, net

 

13,159,036

 

 

9,944,213

Inventory, net

 

51,936,164

 

 

22,364,126

Prepaid expenses and other current assets

 

3,671,657

 

 

1,441,749

Income tax receivable

 

617,141

 

 

Total current assets

 

79,028,246

 

 

62,777,212

Property and equipment, net

 

9,898,126

 

 

4,706,248

Right-of-use lease assets

 

12,909,607

 

 

5,973,702

Intangible assets, net

 

32,732,771

 

 

5,423,980

Other non-current assets

 

790,339

 

 

486,472

Goodwill

 

25,655,428

 

 

4,472,217

Total assets

$

161,014,517

 

$

83,839,831

Liabilities

 

 

 

Current

 

 

 

Current portion of notes payable

$

375,413

 

$

2,568,172

Current portion of lease liabilities

 

2,977,794

 

 

1,650,749

Accounts payable and accrued liabilities

 

32,914,615

 

 

16,797,462

Income tax payable

 

 

 

183,961

Total current liabilities

 

36,267,822

 

 

21,200,344

Deferred tax liability, net

 

2,748,283

 

 

627,806

Other long-term liabilities

 

2,630,486

 

 

729,408

Borrowings on line of credit

 

25,000,000

 

 

Non-current portion of lease liabilities

 

9,830,128

 

 

4,331,214

Non-current portion of notes payable

 

75,717

 

 

3,568,191

Total liabilities

 

76,552,436

 

 

30,456,963

Commitments and Contingencies (Note 15)

 

 

 

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

 

10,581,483

 

 

10,412,471

Accumulated other comprehensive (loss) income

 

(590,446)

 

 

66,215

Retained earnings

 

74,443,431

 

 

42,876,569

Total stockholders’ equity

 

84,462,081

 

 

53,382,868

Total liabilities and stockholders’ equity

$

161,014,517

 

$

83,839,831

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

 

 

(Unaudited)

Three Months Ended December 31,

 

Year Ended December 31,

 

 

2021

 

 

2020

 

 

2019

 

 

2021

 

 

2020

 

 

2019

Net Income

$

6,203,493

 

$

6,088,399

 

$

4,618,474

 

$

31,566,862

 

$

18,281,691

 

$

13,995,072

Interest

 

159,582

 

 

76,000

 

 

15,015

 

 

302,674

 

 

249,480

 

 

96,646

Taxes

 

1,914,400

 

 

1,271,888

 

 

451,991

 

 

7,873,109

 

 

4,522,668

 

 

2,955,356

Depreciation

 

628,559

 

 

384,275

 

 

260,533

 

 

1,887,048

 

 

1,274,095

 

 

915,918

Amortization

 

1,080,273

 

 

250,245

 

 

210,151

 

 

2,500,620

 

 

955,937

 

 

781,105

EBITDA

$

9,986,307

 

$

8,070,807

 

$

5,556,164

 

$

44,130,313

 

$

25,283,871

 

$

18,744,097

 

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