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AMCON Distributing Company Reports Fully Diluted Earnings Per Share Of $9.40 For The Fiscal Year Ended September 30, 2012

“We will be opening two new stores during Fiscal 2013, one serving Northwest Arkansas and the other serving Omaha, NE. Each market met our demographic criteria and we were able to find attractive locations,” said Eric Hinkefent, President of AMCON’s Retail Health Food segment. “Our competitors share our enthusiasm about the industry’s growth prospects and their continued expansion contributes to margin pressure in our existing markets,” added Mr. Hinkefent.

“We are very focused on increasing our shareholders’ equity per share and balance sheet liquidity. At the same time we are reducing our debt levels, and in turn, our debt to equity ratio. At September 30, 2012, shareholders’ equity was $48.5 million, resulting in an adjusted book value per share of $67.54. We turned our inventory 28.5 times and consolidated debt was reduced to $20.6 million,” said Andrew Plummer, AMCON’s Chief Financial Officer. “We are continuing to invest in information technology and foodservice equipment for both internal and customer use for the foreseeable future, as this is a core component of our strategic plan,” commented Mr. Plummer.

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 fourteen (14) 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

 

CONSOLIDATED BALANCE SHEETS

 
    September 30,
2012     2011
ASSETS
Current assets:
Cash $   491,387 $   1,389,665
Accounts receivable, less allowance for doubtful accounts of $1.2 million at both 2012 and 2011 32,681,835 32,963,693
Inventories, net 38,364,621 38,447,982
Deferred income taxes 1,916,619 1,707,889
Prepaid and other current assets     6,476,702       6,073,536
Total current assets 79,931,164 80,582,765
 
Property and equipment, net 13,083,912 13,713,238
Goodwill 6,349,827 6,349,827
Other intangible assets, net 5,185,978 5,550,978
Other assets     1,258,985       1,238,825
$   105,809,866   $   107,435,633
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable $ 17,189,208 $ 18,439,446
Accrued expenses 6,931,859 7,153,672
Accrued wages, salaries and bonuses 2,503,361 2,460,558
Income taxes payable 2,194,966 2,100,180
Current maturities of long-term debt     1,182,829       1,384,625
Total current liabilities 30,002,223 31,538,481
 
Credit facility 14,353,732 20,771,613
Deferred income taxes 3,633,390 2,743,238
Long-term debt, less current maturities 5,075,680 6,194,195
Other long-term liabilities 336,186 429,513
 

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 September 2012 and September 2011

2,500,000

2,500,000
Series B cumulative, convertible preferred stock, $.01 par value 80,000 shares authorized, 58,000 shares issued and outstanding at September 30, 2012 and 62,000 shares issued and outstanding at September 30, 2011, and a total liquidation preference of $1.5 million and $1.6 million at September 2012 and September 2011, respectively 1,450,000 1,550,000
 

Commitments and contingencies

 
Shareholders’ equity:
Preferred stock, $0.01 par value, 1,000,000 shares authorized, 158,000 and 162,000 shares outstanding and issued in Series A and B referred to above
Common stock, $0.01 par value, 3,000,000 shares authorized, 612,327 shares issued and outstanding at September 2012 and 609,320 shares issued and outstanding at September 2011 6,293 6,093
Additional paid-in capital 11,021,109 9,981,055
Retained earnings 38,349,253 31,721,445
Treasury stock, 17,000 shares at cost     (918,000 )    
Total shareholders’ equity     48,458,655       41,708,593
$   105,809,866   $   107,435,633
 

 

AMCON Distributing Company and Subsidiaries

 
CONSOLIDATED STATEMENTS OF OPERATIONS
 
    Fiscal Years Ended September
2012     2011
Sales (including excise taxes of $371.3 million and $340.6 million, respectively) $ 1,174,167,758 $ 1,041,631,892
Cost of sales   1,095,105,573     967,467,852  
Gross profit   79,062,185     74,164,040  
 

Selling, general and administrative expenses

63,250,681 56,374,612
Depreciation and amortization   2,392,414     2,234,814  
  65,643,095     58,609,426  
Operating income 13,419,090 15,554,614
 

Other expense (income):

Interest expense 1,359,241 1,433,790
Other (income), net   (340,713 )   (225,212 )
  1,018,528     1,208,578  
Income from operations before income tax expense 12,400,562 14,346,036
Income tax expense   5,033,000     6,282,000  
Net income 7,367,562 8,064,036
Preferred stock dividend requirements   (269,095 )   (286,397 )
Net income available to common shareholders $ 7,098,467   $ 7,777,639  

 

Basic earnings per share available to common shareholders:

$ 11.56 $ 13.09
 

Diluted earnings per share available to common shareholders:

$ 9.40 $ 10.44
 
Basic weighted average shares outstanding 614,046 594,185
Diluted weighted average shares outstanding 784,108 772,589
 

 

AMCON Distributing Company and Subsidiaries

 
CONSOLIDATED STATEMENTS OF CASH FLOWS
 
    Fiscal Years Ended September
2012     2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 7,367,562 $ 8,064,036

Adjustments to reconcile income from operations to net cash flows from operating activities:

Depreciation 2,017,726 1,850,231
Amortization 374,688 384,583
Gain on sale of property and equipment (36,900 ) (45,848 )
Equity-based compensation 1,426,848 1,851,457
Net excess tax benefit on equity-based awards (139,686 )
Deferred income taxes 681,422 1,865,462
Recoveries of losses on doubtful accounts (5,243 ) (437,757 )
(Recoveries) provision for losses on inventory obsolescence (20,512 ) 114,000
Other (8,045 ) (8,045 )
 

Changes in assets and liabilities, net of effect of business acquisition:

Accounts receivable 287,101 4,259,181
Inventories 103,873 1,015,604
Prepaid and other current assets (403,166 ) (3,025,051 )
Other assets (20,160 ) (169,775 )
Accounts payable (1,250,790 ) 1,810,710
Accrued expenses and accrued wages, salaries and bonuses (710,302 ) (1,256,553 )
Income taxes payable   94,786     (126,801 )
Net cash flows from operating activities   9,898,888     16,005,748  
 

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property and equipment (1,480,782 ) (1,988,139 )
Proceeds from sales of property and equipment 129,834 94,525
Acquisition       (13,368,057 )
Net cash flows from investing activities   (1,350,948 )   (15,261,671 )
 

CASH FLOWS FROM FINANCING ACTIVITIES:

Net (payments) borrowings on bank credit agreements (6,417,881 ) 1,954,904
Principal payments on long-term debt (1,320,311 ) (1,093,147 )
Repurchase of common stock (918,000 )
Net excess tax benefit on equity-based awards 139,686
Dividends paid on convertible preferred stock (269,095 ) (286,397 )
Dividends on common stock (470,659 ) (448,584 )
Proceeds from exercise of stock options 1,180 22,391
Withholdings on the exercise of equity-based awards   (51,452 )    
Net cash flow from financing activities   (9,446,218 )   288,853  
 

Net change in cash

(898,278 ) 1,032,930
Cash, beginning of year   1,389,665     356,735  
Cash, end of year $ 491,387   $ 1,389,665  
 

 

AMCON Distributing Company and Subsidiaries

 
CONSOLIDATED STATEMENTS OF CASH FLOWS - (Continued)
 
    Fiscal Years
2012     2011
Supplemental disclosure of cash flow information:
Cash paid during the year for interest $   1,393,470 $   1,419,636
Cash paid during the year for income taxes 4,256,794 4,543,338
 

Supplemental disclosure of non-cash information:

Equipment acquisitions classified as accounts payable $ 11,237 $ 10,685
Issuance of common stock in connection with the vesting and exercise of equity based awards 950,562
Conversion by holders of Series B Convertible Preferred Stock to common stock 100,000 450,000
 

Business acquisition

Accounts receivable $ $ 8,881,428
Inventories 4,571,629
Property and equipment 1,795,859
Prepaid asset 35,000
Fair value of non-competition agreement 500,000
Customer relationships intangible asset 500,000
Goodwill 200,659
Accrued expenses (120,000 )
Note payable (2,552,090 )
Amount due under non-competition agreement (444,428 )
 

 

AMCON Distributing Company and Subsidiaries

 

FISCAL YEAR 2012

               
(dollars in thousands, except per share data) First Second Third Fourth
 
Sales $   283,563 $   275,829 $   307,113 $   307,663

Gross profit

    18,638       19,216       19,901       21,307  

Income from operations before income tax expense

    2,401       2,475       3,189       4,335  

Net Income

1,438 1,465 1,846 2,618

Preferred stock dividend requirements

(67 ) (67 ) (67 ) (67 )

Net income available to common shareholders

$   1,371   $   1,398   $   1,779   $   2,551  
 

Basic earnings per share available to common shareholders

$   2.21   $   2.26   $   2.92   $   4.19  

Diluted earnings per share available to common shareholders

$   1.83   $   1.87   $   2.37   $   3.33  
 
 

FISCAL YEAR 2011

(dollars in thousands, except per share data) First Second Third Fourth
 
Sales $ 244,957 $ 216,603 $ 263,828 $ 316,244

Gross profit

    17,608       16,369       18,218       21,969  

Income from operations before income tax expense

    3,061       2,734       3,619       4,932  

Net Income

1,832 1,584 1,828 2,820

Preferred stock dividend requirements

(75 ) (73 ) (71 ) (67 )

Net income available to common shareholders

$   1,757   $   1,511   $   1,757   $   2,753  
 

Basic earnings per share available to common shareholders

$   3.04   $   2.56   $   2.93   $   4.52  

Diluted earnings per share available to common shareholders

$   2.41   $   2.05   $   2.36   $   3.62  
 

The Company’s quarterly earnings per share are based on weighted average shares outstanding for the quarter, therefore the sum of the quarters may not equal the full year earnings per share amount.

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