Pool Corporation Reports Fiscal 2010 Results

Highlights for the year include :

• Sales growth of 5%, including 2% from base business
• 14% increase in operating income
• 2010 Diluted EPS of $1.15
• 2011 Diluted EPS guidance of $1.27 to $1.35

COVINGTON, La., Feb. 17, 2011 (GLOBE NEWSWIRE) -- Pool Corporation (Nasdaq:POOL) today announced fourth quarter and full year 2010 results.

"As expected, 2010 proved to be a transitional year. Our successful execution was the primary factor driving our increased sales and earnings. This performance, coupled with strong cash flow generation, enabled us to not only further de-leverage our balance sheet, but also to resume repurchasing shares and complete three acquisitions," commented Manuel Perez de la Mesa, President and CEO.

Net sales for the year ended December 31, 2010 increased 5% to $1.61 billion, compared to $1.54 billion in 2009. Base business sales increased 2% due to market share gains and some gradual improvement in external market trends that resulted in higher discretionary purchases by consumers. Base business sales growth for the year includes 3% growth on the swimming pool side of the business, with increases in many markets and most product categories. While sales on the irrigation side of the business decreased compared to 2009, sales declines moderated as 2010 progressed.  

Gross profit for the year ended December 31, 2010 increased 5% to $471.3 million from $449.7 million in 2009. Gross profit as a percentage of net sales (gross margin) remained flat year over year at 29.2% as improved pricing and purchasing discipline offset downward margin pressures due to the competitive pricing environment. 

Selling and administrative expenses (operating expenses) for 2010 increased 2% to $370.0 million from $361.3 million in 2009. This increase is primarily due to the impact of expenses related to recent acquisitions .  Base business operating expenses were essentially flat year over year with a $9.1 million increase in incentive costs offset by decreases in bad debt expense, facility lease costs and other expenses.  

Operating income for the year improved 14% to $101.2 million from $88.4 million in 2009. Operating income as a percentage of net sales (operating margin) increased to 6.3% in 2010 compared to 5.7% in 2009. Adjusted EBITDA (as defined in the addendum to this release) was $121.4 million in 2010 compared to $107.9 million in 2009. Interest expense, net declined $3.0 million compared to 2009 due primarily to a 23% decline in average debt outstanding.