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| 8-K - AMCON DISTRIBUTING COMPANY 8-K - AMCON DISTRIBUTING CO | a50907554.htm |
Exhibit 99.1
AMCON Distributing Company Reports Fully Diluted Earnings Per Share of $1.73 for the Quarter Ended June 30, 2014
OMAHA, Neb.--(BUSINESS WIRE)--July 17, 2014--AMCON Distributing Company (“AMCON”) (NYSE MKT:DIT), an Omaha, Nebraska based consumer products company is pleased to announce fully diluted earnings per share of $1.73 on net income available to common shareholders of $1.2 million for the fiscal quarter ended June 30, 2014.
“We continue to make progress on our facility expansion at our branch in Rapid City. When completed, our northern customers will benefit from our enhanced foodservice capabilities,” said Christopher H. Atayan, AMCON’s Chairman and Chief Executive Officer. Atayan also noted, “The reach and intellectual capital embedded within our wholesale business is considerable. We are exploring different ways to leverage and monetize those competencies. We believe the independent c-store channel is hungry for solutions as they aggressively compete for business with larger chains. We feel that we play an important role in providing many of these higher margin solutions in areas such as information technology and category management.”
Our wholesale distribution segment reported revenues of $314.1 million and operating income before depreciation and amortization of $4.1 million for the third fiscal quarter of 2014. The retail health food segment reported revenues of $8.5 million and operating income before depreciation and amortization of $0.3 million for the same period.
“We continue to monitor development of the e-cigarette and vaping category which is growing both within the c-store channel and through other retail channels and is attracting additional scrutiny from regulators. We currently offer a full range of e-cigarette and vaping products and will modify our approach to this product category as market conditions change,” said Kathleen M. Evans, President of AMCON’s wholesale distribution segment.
“The growth in the natural foods retail industry has led to a significant number of new competitors in our Midwestern markets. We have implemented our response to this competition and are carefully evaluating our product mix while seeking operating additions and consolidations where appropriate, all within the context of delivering a high level of customer service and satisfaction,” said Eric Hinkefent, President of AMCON’s retail health food segment.
“We continue to utilize our balance sheet strength to deliver on key corporate objectives. During the quarter, we negotiated the repurchase of 8,830 shares of common stock in a private transaction while at the same time closing on a second small acquisition in North Dakota. The recent North Dakota acquisitions and capital expenditures for the Rapid City facility expansion improve our market penetration in the growing Dakota markets. We closed the June 30, 2014 quarter with shareholders’ equity of $53.7 million and consolidated debt of $25.3 million,” said Andrew Plummer, AMCON’s Chief Financial Officer.
AMCON is a leading wholesale distributor of consumer products, including beverages, candy, tobacco, groceries, foodservice, frozen and chilled foods, and health and beauty care products with locations in Illinois, Missouri, Nebraska, North Dakota, South Dakota and Tennessee. AMCON also operates sixteen (16) health and natural product retail stores in the Midwest and Florida. The retail stores operate under the names Chamberlin's Market & Cafe www.chamberlins.com and Akin’s Natural Foods Market www.akins.com.
This news release contains forward-looking statements that are subject to risks and uncertainties and which reflect management's current beliefs and estimates of future economic circumstances, industry conditions, Company performance and financial results. A number of factors could affect the future results of the Company and could cause those results to differ materially from those expressed in the Company's forward-looking statements including, without limitation, availability of sufficient cash resources to conduct its business and meet its capital expenditures needs and the other factors described under Item 1.A. of the Company’s Annual Report on Form 10-K. Moreover, past financial performance should not be considered a reliable indicator of future performance. Accordingly, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all such forward-looking statements.
Visit AMCON Distributing Company's web site at: www.amcon.com
| AMCON Distributing Company and Subsidiaries | ||||||||||
| Condensed Consolidated Balance Sheets | ||||||||||
| June 30, 2014 and September 30, 2013 | ||||||||||
| June | September | |||||||||
| 2014 | 2013 | |||||||||
| (Unaudited) | ||||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash | $ | 333,751 | $ | 275,036 | ||||||
|
Accounts receivable, less allowance for doubtful accounts of $1.2 million and $1.1 million at June 2014 and September 2013, respectively |
29,699,236 | 28,383,205 | ||||||||
| Inventories, net | 48,639,828 | 46,125,187 | ||||||||
| Deferred income taxes | 1,652,702 | 1,831,933 | ||||||||
| Prepaid and other current assets | 7,050,381 | 5,001,992 | ||||||||
| Total current assets | 87,375,898 | 81,617,353 | ||||||||
| Property and equipment, net | 13,944,111 | 13,088,859 | ||||||||
| Goodwill | 6,349,827 | 6,349,827 | ||||||||
| Other intangible assets, net | 4,547,228 | 4,820,978 | ||||||||
| Other assets | 465,990 | 497,882 | ||||||||
| $ | 112,683,054 | $ | 106,374,899 | |||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | 16,447,785 | $ | 15,859,636 | ||||||
| Accrued expenses | 7,114,393 | 6,714,444 | ||||||||
| Accrued wages, salaries and bonuses | 3,105,187 | 2,754,136 | ||||||||
| Income taxes payable | 332,604 | 1,922,351 | ||||||||
| Current maturities of long-term debt | 338,595 | 998,788 | ||||||||
| Total current liabilities | 27,338,564 | 28,249,355 | ||||||||
| Credit facility | 21,164,401 | 14,841,712 | ||||||||
| Deferred income taxes | 3,569,713 | 3,327,010 | ||||||||
| Long-term debt, less current maturities | 3,821,735 | 4,076,892 | ||||||||
| Other long-term liabilities | 141,014 | 239,396 | ||||||||
|
Series A cumulative, convertible preferred stock, $.01 par value 100,000 shares authorized and issued, and a total liquidation preference of $2.5 million at both June 2014 and September 2013 |
2,500,000 | 2,500,000 | ||||||||
|
Series B cumulative, convertible preferred stock, $.01 par value 80,000 shares authorized, 16,000 shares issued and outstanding at both June 2014 and September 2013, and a total liquidation preference of $0.4 million at both June 2014 and September 2013 |
400,000 | 400,000 | ||||||||
|
Shareholders’ equity: |
||||||||||
|
Preferred stock, $.01 par value, 1,000,000 shares authorized, 116,000 shares outstanding and issued in Series A and B referred to above |
— | — | ||||||||
|
Common stock, $.01 par value, 3,000,000 shares authorized, 602,602 shares outstanding at June 2014 and 623,115 shares outstanding at September 2013 |
6,677 | 6,543 | ||||||||
| Additional paid-in capital | 13,577,433 | 12,502,135 | ||||||||
| Retained earnings | 46,112,791 | 43,532,812 | ||||||||
| Treasury stock at cost | (5,949,274 | ) | (3,300,956 | ) | ||||||
| Total shareholders’ equity | 53,747,627 | 52,740,534 | ||||||||
| $ | 112,683,054 | $ | 106,374,899 | |||||||
| AMCON Distributing Company and Subsidiaries | ||||||||||||||||||||
| Condensed Consolidated Unaudited Statements of Operations | ||||||||||||||||||||
| for the three and nine months ended June 30, 2014 and 2013 | ||||||||||||||||||||
| For the three months | For the nine months | |||||||||||||||||||
| ended June | ended June | |||||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||||||
|
Sales (including excise taxes of $100.4 million and $100.2 million, and $283.5 million and $285.4 million, respectively) |
$ | 322,647,624 | $ | 316,031,197 | $ | 900,694,969 | $ | 892,817,669 | ||||||||||||
| Cost of sales | 303,353,020 | 296,220,406 | 844,139,340 | 835,480,069 | ||||||||||||||||
| Gross profit | 19,294,604 | 19,810,791 | 56,555,629 | 57,337,600 | ||||||||||||||||
|
Selling, general and administrative expenses |
16,295,082 | 16,065,285 | 48,599,519 | 47,351,952 | ||||||||||||||||
| Depreciation and amortization | 557,736 | 598,061 | 1,810,610 | 1,791,708 | ||||||||||||||||
| 16,852,818 | 16,663,346 | 50,410,129 | 49,143,660 | |||||||||||||||||
| Operating income | 2,441,786 | 3,147,445 | 6,145,500 | 8,193,940 | ||||||||||||||||
| Other expense (income): | ||||||||||||||||||||
| Interest expense | 228,827 | 309,445 | 753,446 | 874,489 | ||||||||||||||||
| Other (income), net | (37,473 | ) | (49,487 | ) | (106,659 | ) | (225,682 | ) | ||||||||||||
| 191,354 | 259,958 | 646,787 | 648,807 | |||||||||||||||||
| Income from operations before income tax expense | 2,250,432 | 2,887,487 | 5,498,713 | 7,545,133 | ||||||||||||||||
| Income tax expense | 990,000 | 1,255,000 | 2,419,000 | 3,236,000 | ||||||||||||||||
| Net income | 1,260,432 | 1,632,487 | 3,079,713 | 4,309,133 | ||||||||||||||||
| Preferred stock dividend requirements | (48,643 | ) | (48,642 | ) | (145,928 | ) | (156,041 | ) | ||||||||||||
| Net income available to common shareholders | $ | 1,211,789 | $ | 1,583,845 | $ | 2,933,785 | $ | 4,153,092 | ||||||||||||
|
Basic earnings per share available to common shareholders |
$ | 2.00 | $ | 2.54 | $ | 4.79 | $ | 6.67 | ||||||||||||
| Diluted earnings per share available to common shareholders | $ | 1.73 | $ | 2.19 | $ | 4.18 | $ | 5.73 | ||||||||||||
| Basic weighted average shares outstanding | 605,319 | 623,115 | 613,032 | 622,833 | ||||||||||||||||
| Diluted weighted average shares outstanding | 729,978 | 744,732 | 736,531 | 751,946 | ||||||||||||||||
| AMCON Distributing Company and Subsidiaries | ||||||||||
| Condensed Consolidated Unaudited Statements of Cash Flows | ||||||||||
| for the nine months ended June 30, 2014 and 2013 | ||||||||||
| 2014 | 2013 | |||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||
| Net income | $ | 3,079,713 | $ | 4,309,133 | ||||||
| Adjustments to reconcile net income from operations to net cash flows from operating activities: | ||||||||||
| Depreciation | 1,536,860 | 1,517,958 | ||||||||
| Amortization | 273,750 | 273,750 | ||||||||
| Gain on sale of property and equipment | (42,745 | ) | (72,318 | ) | ||||||
| Equity-based compensation | 1,025,694 | 971,954 | ||||||||
| Deferred income taxes | 421,934 | 449,188 | ||||||||
| Provision for losses on doubtful accounts | 63,000 | 80,000 | ||||||||
| Provision for losses on inventory obsolescence | 15,878 | 54,028 | ||||||||
| Other | (6,034 | ) | (6,034 | ) | ||||||
| Changes in assets and liabilities: | ||||||||||
| Accounts receivable | (1,379,031 | ) | (2,852,651 | ) | ||||||
| Inventories | (1,572,589 | ) | (9,827,717 | ) | ||||||
| Prepaid and other current assets | (2,048,389 | ) | (1,622,018 | ) | ||||||
| Other assets | 31,892 | 55,753 | ||||||||
| Accounts payable | 598,939 | (1,070,612 | ) | |||||||
| Accrued expenses and accrued wages, salaries and bonuses | 805,286 | 525,856 | ||||||||
| Income tax payable | (1,589,747 | ) | (1,096,612 | ) | ||||||
| Net cash flows from operating activities | 1,214,411 | (8,310,342 | ) | |||||||
|
|
||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||
| Purchases of property and equipment | (2,337,626 | ) | (1,808,206 | ) | ||||||
| Proceeds from sales of property and equipment | 47,969 | 144,841 | ||||||||
| Acquisition | (996,803 | ) | — | |||||||
| Net cash flows from investing activities | (3,286,460 | ) | (1,663,365 | ) | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||
| Net borrowings on bank credit agreements | 6,322,689 | 13,697,657 | ||||||||
| Principal payments on long-term debt | (915,350 | ) | (883,923 | ) | ||||||
| Repurchase of Series B Convertible Preferred Stock and common stock | (2,648,318 | ) | (2,572,085 | ) | ||||||
| Dividends paid on convertible preferred stock | (145,928 | ) | (156,041 | ) | ||||||
| Dividends on common stock | (353,806 | ) | (352,406 | ) | ||||||
| Proceeds from exercise of stock options | — | 1,180 | ||||||||
| Withholdings on the exercise of equity-based awards | (128,523 | ) | (74,610 | ) | ||||||
| Net cash flows from financing activities | 2,130,764 | 9,659,772 | ||||||||
| Net change in cash | 58,715 | (313,935 | ) | |||||||
|
Cash, beginning of period |
275,036 | 491,387 | ||||||||
| Cash, end of period | $ | 333,751 | $ | 177,452 | ||||||
| Supplemental disclosure of cash flow information: | ||||||||||
| Cash paid during the period for interest | $ | 751,909 | $ | 851,665 | ||||||
| Cash paid during the period for income taxes | 3,586,813 | 3,883,424 | ||||||||
| Supplemental disclosure of non-cash information: | ||||||||||
| Equipment acquisitions classified as accounts payable | 62,414 | 21,248 | ||||||||
|
Issuance of common stock in connection with the vesting and exercise of equity-based awards |
1,154,869 | 1,389,258 | ||||||||
| Conversion by holder of Series B Convertible Preferred Stock to common stock | — | 100,000 | ||||||||
| Common stock acquired with other consideration | — | 760,871 | ||||||||
CONTACT:
AMCON Distributing Company
Christopher H. Atayan,
402-331-3727