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Generac Reports Strong Second Quarter 2012 Results

Stocks in this article: GNRC

Generac Holdings Inc. (NYSE: GNRC), a leading designer and manufacturer of generators and other engine powered products, today reported financial results for its second quarter ended June 30, 2012.


  • Net sales increased year-over-year by 48.2% to $239.1 million as compared to $161.4 million in the second quarter of 2011.
    • Residential product sales increased 33.8% compared to the second quarter of 2011.
    • Commercial & Industrial (C&I) product sales increased 76.4% compared to the prior year second quarter.
  • Net sales over the trailing four quarters were $1.040 billion; on a pro-forma basis, when including the results for Magnum Products for the entire period, net sales were $1.082 billion.
  • Net income was $9.3 million or $0.14 per share for the second quarter of 2012 as compared to $15.3 million or $0.23 per share for the same period of 2011. The current year results include a charge for refinancing costs and a normalized effective income tax rate. Adjusted net income, as defined in the accompanying reconciliation schedules, increased to $39.9 million from $27.7 million in the second quarter of 2011. Adjusted diluted net income per common share was $0.58 as compared to $0.41 per share in the second quarter of 2011.
  • Adjusted EBITDA increased to $54.6 million as compared to $37.6 million in the second quarter last year.
  • Cash flow from operations in the second quarter of 2012 was $21.1 million as compared to $15.3 million in the prior year quarter. Free cash flow was $17.8 million as compared to $13.5 million in the second quarter of 2011.
  • For the trailing four quarters, net income was $343.9 million; adjusted EBITDA, pro-forma for Magnum Products was $258.3 million; cash flow from operations was $201.4 million; and free cash flow was $187.3 million, which represents 90% of the adjusted net income reported during that time period.
  • The Company is raising its sales growth guidance for full-year 2012 to the low-20% range over the prior year, which represents an increase from the high-teens growth rate previously expected. As a result, Adjusted EBITDA for the full-year 2012 is now expected to increase in the high-teens range over the prior year, which is an increase from the mid-teens growth rate previously expected.

“Our second quarter results continue to demonstrate the progress we are making in executing our Powering Ahead strategic plan,” said Aaron Jagdfeld, President and Chief Executive Officer. “Growth in shipments of home standby and portable generators were again strong during the second quarter. In particular, the market for our home standby generators continues to develop as more home owners discover the importance of having backup power. In our commercial and industrial products, Magnum continues to perform well as demand for mobile equipment is benefiting from a shift towards renting versus buying. In addition, while still a smaller portion of the overall C&I market, our leadership position in natural gas backup generators within North America has allowed us to benefit from the increased demand for these products.”

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