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XPEL Reports Record Revenue of $68.7 Million in Second Quarter 2021; Net Income of $10.2 Million

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SAN ANTONIO, August 09, 2021--(BUSINESS WIRE)--XPEL, Inc. (Nasdaq: XPEL) (the "Company"), a global provider of protective films and coatings, announced results for the second quarter and first six months ended June 30, 2021.

Second Quarter 2021 Highlights:

  • Revenues increased 92.0% to $68.7 million compared to second quarter 2020 and increased 32.5% sequentially compared to first quarter 2021

  • Net income grew 156.3% to $10.2 million, or $0.37 per basic and diluted share, compared to $4.0 million, or $0.14 per basic and diluted share, in the same quarter of 2020

  • EBITDA grew 139.8% to $13.6 million, or 19.8% of revenues compared to $5.7 million, or 15.8% of sales in second quarter 20201

First Six Months Highlights:

  • Revenues increased 87.9% to $120.6 million as compared to $64.2 million in the prior year period

  • Net income increased by more than 200% to $17.0 million, or $0.62 per basic and diluted share, compared to $5.6 million, or $0.20 per basic and diluted share, in the same period of 2020

  • EBITDA grew 176.1% to $22.7 million, or 18.9% of revenues, as compared to $8.2 million, or 12.8% in the same prior year period1

For the Quarter Ended June 30, 2021:

Revenues. Revenues increased approximately $32.9 million, or 92%, to $68.7 million as compared to $35.8 million in the prior year.

Gross Margin. Gross margin was 36.7% compared to 32.8% in the second quarter of 2020.

Expenses. Operating expenses increased to $12.6 million, or 18.3% of sales, compared to $6.6 million, or 18.4% of sales in the prior year period.

Net income. Net income was $10.2 million, or $0.37 per basic and diluted share, versus net income of $4.0 million, or $0.14 per basic and diluted share in the second quarter of 2020.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was $13.6 million, or 19.8% of sales, compared to $5.7 million, or 15.8% of sales in the prior year1.

1 See reconciliation of non-GAAP financial measures below

For the Six Months Ended June 30, 2021:

Revenues. Revenues increased approximately $56.4 million, or 87.9%, to $120.6 million as compared to $64.2 million in the same period of the prior year.

Gross Margin. Gross margin was 36.1% compared to 34.3% in the first six months of 2020.

Expenses. Operating expenses increased to $22.3 million, or 18.5% of sales, compared to $14.4 million, or 22.5%, of sales in the same prior year period.

Net income. Net income was $17.0 million, or $0.62 per basic and diluted share, versus net income of $5.6 million, or $0.20 per basic and diluted share in the first half of 2020.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was $22.7 million, or 18.9% of sales, compared to $8.2 million, or 12.8% of sales in the same prior year period1.

Conference Call Information

The Company will host a conference call and webcast today, August 9, 2021 at 11:00 a.m. Eastern Time to discuss the Company’s second quarter 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 (844) 407-9500 approximately five minutes prior to the scheduled start time. International callers please dial (862) 298-0850.

A replay of the teleconference will be available until September 9, 2021 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 42329.

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.

Condensed Consolidated Statements of Income (Unaudited)

Three Months Ended

June 30,

Six Months Ended

June 30,

2021

2020

2021

2020

Revenue

Product revenue

$

58,667,314

$

30,961,996

$

103,598,668

$

54,711,913

Service revenue

10,068,657

4,843,862

17,003,417

9,482,408

Total revenue

68,735,971

35,805,858

120,602,085

64,194,321

Cost of Sales

Cost of product sales

40,592,311

22,556,696

72,138,858

39,318,109

Cost of service

2,896,432

1,510,085

4,929,568

2,840,247

Total cost of sales

43,488,743

24,066,781

77,068,426

42,158,356

Gross Margin

25,247,228

11,739,077

.

43,533,659

22,035,965

Operating Expenses

Sales and marketing

4,686,693

1,919,529

8,074,523

4,662,778

General and administrative

7,888,213

4,679,092

14,239,704

9,748,863

Total operating expenses

12,574,906

6,598,621

22,314,227

14,411,641

Operating Income

12,672,322

5,140,456

.

21,219,432

7,624,324

Interest expense

43,940

74,554

96,659

105,112

Foreign currency exchange (gain) loss

(62,906)

4,141

(27,294)

419,718

Income before income taxes

12,691,288

5,061,761

.

21,150,067

7,099,494

Income tax expense

2,505,739

1,088,071

4,117,459

1,514,450

Net income

$

10,185,549

$

3,973,690

.

$

17,032,608

$

5,585,044

Earnings per share

Basic and diluted

$

0.37

$

0.14

$

0.62

$

0.20

Weighted Average Number of Common Shares

Basic and diluted

27,612,597

27,612,597

27,612,597

27,612,597

XPEL Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(Audited)

June 30, 2021

December 31, 2020

Assets

Current

Cash and cash equivalents

$

8,733,902

$

29,027,124

Accounts receivable, net

12,625,703

9,944,213

Inventory, net

25,728,267

22,364,126

Prepaid expenses and other current assets

3,207,502

1,441,749

Total current assets

50,295,374

62,777,212

Property and equipment, net

7,556,788

4,706,248

Right-of-use lease assets

9,314,337

5,973,702

Intangible assets, net

21,902,077

5,423,980

Other non-current assets

477,920

486,472

Goodwill

15,826,655

4,472,217

Total assets

$

105,373,151

$

83,839,831

Liabilities

Current

Current portion of notes payable

$

513,891

$

2,568,172

Current portion lease liabilities

1,145,724

1,650,749

Accounts payable and accrued liabilities

21,957,708

16,797,462

Income tax payable

1,382,177

183,961

Total current liabilities

24,999,500

21,200,344

Deferred tax liability, net

646,921

627,806

Other long-term liabilities

865,066

729,408

Non-current portion of lease liabilities

8,190,262

4,331,214

Non-current portion of notes payable

239,055

3,568,191

Total liabilities

34,940,804

30,456,963

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 outstanding

27,613

27,613

Additional paid-in-capital

10,412,471

10,412,471

Accumulated other comprehensive income (loss)

83,086

66,215

Retained earnings

59,909,177

42,876,569

Total stockholders’ equity

70,432,347

53,382,868

Total liabilities and stockholders’ equity

$

105,373,151

$

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)

(Unaudited)

Three Months Ended June 30,

Six Months Ended June 30, 2021

2021

2020

2021

2020

Net Income

$

10,185,549

$

3,973,690

$

17,032,608

$

5,585,044

Interest

43,940

74,554

96,659

105,112

Taxes

2,505,739

1,088,071

4,117,459

1,514,450

Depreciation

419,607

293,860

802,697

564,177

Amortization

422,778

232,225

685,384

466,121

EBITDA

$

13,577,613

$

5,662,400

$

22,734,807

$

8,234,904

View source version on businesswire.com: https://www.businesswire.com/news/home/20210809005161/en/

Contacts

Investor Relations:
John Nesbett/Jennifer Belodeau
IMS Investor Relations
Phone: (203) 972-9200
Email: jnesbett@institutionalms.com