XPEL, a global provider of protective films and coatings, announced results for the fourth quarter and year ended December 31, 2022.
Fourth Quarter 2022 Highlights:
• Revenue increased 11.9% to $78.5 million compared to fourth quarter 2021;
• Net income increased 34.7% to $8.4 million, or $0.30 per basic and diluted share, versus net income of $6.2 million, or $0.22 per basic and diluted share in the fourth quarter of 2021;
• And EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) grew 32.4% to $13.2 million, or 16.8% of revenue compared to $10.0 million, or 14.2% of revenue in fourth quarter 2021.
Year End 2022 Highlights:
• Revenue increased 25.0% to $324.0 million as compared to $259.3 million in the prior year;
• Net income increased by 31.1% to $41.4 million, or $1.50 per basic and diluted share, compared to $31.6 million, or $1.14 per basic and diluted share, in 2021;
• And EBITDA grew 38.7% to $61.2 million, or 18.9% of revenue, as compared to $44.1 million, or 17.0% in the prior year.
In the quarter, the company’s revenue was negatively impacted by approximately $3.5 million resulting from the cancellation of some China orders due to uncertainty created by the change in COVID policies and China’s reopening.
The company also incurred approximately $0.4 million in inventory write-offs which negatively impacted gross margin. The company’s selling, general and administrative expenses were negatively impacted by approximately $0.3 million in severance-related costs and $0.4 million in compensation expense tangential to a previous acquisition.
Normalizing for these items, revenue would have grown approximately 17%, EBITDA margin would have been approximately 18% and EPS would have been approximately $0.36 per share, according to the company.
Ryan Pape, president and CEO of XPEL, says, “Despite some headwinds in the fourth quarter, there is a lot to be positive about as we look to 2023. We continue to have tremendous momentum in almost all of our regions, particularly the U.S. which grew 31.6% in the quarter. Automakers seem cautiously optimistic about 2023 and new car inventories continue to improve. This momentum has continued and we are off to a great start in 2023.”