EX-99.1 2 pressreleasedatedfebruary2.htm EX-99.1 Document
Ex. 99.1
XPEL Reports Fourth Quarter and 2022 Year End Results


San Antonio, TX – February 28, 2023 – XPEL, Inc. (Nasdaq: XPEL) (the "Company"), 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 diluted and share, versus net income of $6.2 million, or $0.22 per basic and diluted share in the fourth quarter of 2021.

•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 2021.1


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.

•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.1

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.

Ryan Pape, President and Chief Executive Officer of XPEL, commented, “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 US 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.”

For the Quarter Ended December 31, 2022:

Revenue. Revenue increased approximately $8.3 million, or 11.9%, to $78.5 million as compared to $70.1 million in the fourth quarter of the prior year.

Gross Margin. Gross margin was 39.6% compared to 35.2% in the fourth quarter of 2021.

Expenses. Operating expenses increased to $20.2 million, or 25.7% of revenue, compared to $16.2 million, or 23.0% of revenue in the prior year period.



Net income. Net income was $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.

EBITDA. EBITDA was $13.2 million, or 16.8% of revenue, compared to $10.0 million, or 14.2% of revenue in the fourth quarter of the prior year.1

For the Year Ended December 31, 2022:

Revenue. Revenue increased approximately $64.7 million, or 25.0%, to $324.0 million as compared to $259.3 million in the prior year.

Gross Margin. Gross margin was 39.4% compared to 35.7% for full year 2021.

Expenses. Operating expenses increased to $73.6 million, or 22.7% of revenue, compared to $52.6 million, or 20.3%, of revenue in full year 2021.

Net income. Net income was $41.4 million, or $1.50 per basic and diluted share, versus net income of $31.6 million, or $1.14 per basic and diluted share in full year 2021.

EBITDA. EBITDA was $61.2 million, or 18.9% of revenue, compared to $44.1 million, or 17.0% of revenue in the prior year.1

Conference Call Information

The Company will host a conference call and webcast today, February 28, 2023 at 11:00 a.m. Eastern Time to discuss the Company’s fourth quarter and year end 2022 results.

To access the live webcast, please visit the XPEL, Inc. website at www.xpel.com/investor.

To participate in the call by phone, dial 888-506-0062 approximately five minutes prior to the scheduled start time. International callers please dial (973) 528-0011. Callers should use access code: 264934.

A replay of the teleconference will be available until March 30, 2023 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 47536.


About XPEL, Inc.
XPEL is a leading provider of protective films and coatings, including automotive paint protection film, surface protection film, automotive and architectural window films, and ceramic coatings. With a global footprint, a network of trained installers and proprietary DAP software, XPEL is dedicated to exceeding customer expectations by providing high-quality products, leading customer service, expert technical support and world-class training. XPEL, Inc. is publicly traded on Nasdaq under the symbol “XPEL”.


1 See reconciliation of non-GAAP financial measures below



Safe harbor statement

This release includes forward-looking statements regarding XPEL, Inc. and its business, which may include, but is not limited to, anticipated use of proceeds from capital transactions, expansion into new markets, and execution of the company's growth strategy. Often, but not always, forward-looking statements can be identified by the use of words such as "plans," "is expected," "expects," "scheduled," "intends," "contemplates,"


"anticipates," "believes," "proposes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may," "could," "would," "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations of the management of XPEL. The forward-looking events and circumstances discussed in this release may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the company, performance and acceptance of the company's products, economic factors, competition, the equity markets generally and many other factors beyond the control of XPEL. Although XPEL has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and XPEL undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.



For more information, contact:
Investor Relations:
John Nesbett/Jennifer Belodeau
IMS Investor Relations
Phone: (203) 972-9200
Email: jnesbett@institutionalms.com


XPEL, Inc.
Consolidated Statements of Income
(In thousands except per share data)


(Unaudited)
Three Months Ended December 31,		Year Ended December 31,
2022202120222021
Revenue
Product revenue$60,421 $56,688 $258,174 $217,283 
Service revenue18,060 13,444 65,819 41,980 
Total revenue78,481 70,132 323,993 259,263 
Cost of Sales
Cost of product sales40,259 39,446 169,905 151,286 
Cost of service7,176 5,997 26,576 15,300 
Total cost of sales47,435 45,443 196,481 166,586 
Gross Margin31,046 24,689 127,512 92,677 
Operating Expenses
Sales and marketing6,852 5,295 25,367 18,273 
General and administrative13,349 10,865 48,208 34,288 
Total operating expenses20,201 16,160 73,575 52,561 
Operating Income10,845 8,529 53,937 40,116 
Interest expense477 160 1,410 303 
Foreign currency exchange (gain) loss(272)251 562 373 
Income before income taxes10,640 8,118 51,965 39,440 
Income tax expense2,282 1,914 10,584 7,873 
Net income$8,358 $6,204 $41,381 $31,567 
Earnings per share
Basic$0.30 $0.22 $1.50 $1.14 
Diluted$0.30 $0.22 $1.50 $1.14 
Weighted Average Number of Common Shares
Basic27,616 27,613 27,614 27,613 
Diluted27,618 27,613 27,616 27,613 
















XPEL, Inc.
Consolidated Balance Sheets
(In thousands except share and per share data)
December 31, 2022December 31, 2021
Assets
Current
Cash and cash equivalents$8,056 $9,644 
Accounts receivable, net14,726 13,159 
Inventory, net80,575 51,936 
Prepaid expenses and other current assets3,464 3,672 
Income tax receivable— 617 
Total current assets106,821 79,028 
Property and equipment, net14,203 9,898 
Right-of-use lease assets15,309 12,910 
Intangible assets, net29,294 32,733 
Other non-current assets972 791 
Goodwill26,763 25,655 
Total assets$193,362 $161,015 
Liabilities
Current
Current portion of notes payable$77 $375 
Current portion of lease liabilities3,885 2,978 
Accounts payable and accrued liabilities22,970 32,915 
Income tax payable470 — 
Total current liabilities27,402 36,268 
Deferred tax liability, net2,049 2,748 
Other long-term liabilities1,070 2,631 
Borrowings on line of credit26,000 25,000 
Non-current portion of lease liabilities12,119 9,830 
Non-current portion of notes payable— 76 
Total liabilities68,640 76,553 
Commitments and Contingencies (Note 15)
Stockholders’ equity
Preferred stock, $0.001 par value; authorized 10,000,000; none issued and outstanding— — 
Common stock, $0.001 par value; 100,000,000 shares authorized; 27,616,064 issued and outstanding28 28 
Additional paid-in-capital11,073 10,581 
Accumulated other comprehensive loss(2,203)(590)
Retained earnings115,824 74,443 
Total stockholders’ equity124,722 84,462 
Total liabilities and stockholders’ equity$193,362 $161,015 













Reconciliation of Non-GAAP Financial Measure

EBITDA is a non-GAAP financial measure. EBITDA is defined as net income (loss) plus interest expense, net, plus income tax expense plus depreciation expense and amortization expense. EBITDA should be considered in addition to, not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. It is not a measurement of our financial performance under GAAP and should not be considered as alternatives to revenue or net income, as applicable, or any other performance measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other businesses. EBITDA has limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our operating results as reported under GAAP.

EBITDA does not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of ongoing operations and other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure.


EBITDA Reconciliation

(Unaudited)
Three Months Ended December 31,		Year Ended December 31,
2022202120222021
Net Income$8,358 $6,204 $41,381 $31,567 
Interest477 160 1,410 303 
Taxes2,282 1,914 10,584 7,873 
Depreciation947 629 3,433 1,887 
Amortization1,153 1,080 4,401 2,501 
EBITDA$13,217 $9,987 $61,209 $44,131