Operating income increased 28% to a record $136 million with operating margin expanding 100 basis-points to 7.4%. On a same-store basis, operating income increased 25% with a 110 basis-point improvement in operating margin to 7.6%.
Revenues grew 11% to a record $1.8 billion. On a same-store basis, sales increased 6%, reflecting an 8% increase in sales of HVAC equipment (64% of sales), a 3% increase in other HVAC products (31% of sales) and a 6% increase in commercial refrigeration products (5% of sales).
Gross profit increased 14% to a record $442 million with a 50 basis-point improvement in gross profit margin to 24.1%. On a same-store basis, gross profit increased 8% and gross profit margin improved by 30 basis-points to 24.0%. SG&A expenses increased 8% to $306 million and, as a percentage of sales, were a record low of 16.7%. Excluding new locations, SG&A increased 1% to $286 million and as a percentage of sales were 16.4%.
Results include 35 new locations from a joint venture formed on April 27, 2012 with Carrier Corporation in Canada, of which Watsco owns 60% and Carrier owns 40%. The results also reflect a 10% greater ownership interest in Carrier Enterprise LLC, a U.S. joint venture formed with Carrier in 2009.Cash Flow and Dividends For the six months ended June 30, 2013, Watsco used $77 million of operating cash flow versus $60 million last year primarily to fund incremental working capital requirements for the summer selling season. The Company expects to meet or exceed its annual target of generating operating cash flow greater than net income in 2013. From 2000 to 2012, operating cash flow was approximately $1.1 billion compared to net income of approximately $900 million, surpassing the Company's stated goal. Dividends paid during 2013 were $17 million. In January 2013, the Company established a regular quarterly dividend rate of 25 cents per share. Watsco has paid a dividend to shareholders for 39 consecutive years.