AMCON Distributing Company Reports Fully Diluted Earnings Per Share of $1.90 for the Fiscal Quarter Ended December 31, 2012

OMAHA, Neb.--()--AMCON Distributing Company (“AMCON”) (NYSE AMEX MKT:DIT), an Omaha, Nebraska based consumer products company is pleased to announce fully diluted earnings per share of $1.90 on net income available to common shareholders of $1.4 million for the fiscal quarter ended December 31, 2012.

“We are progressing toward the opening of our two new stores located in Northwest Arkansas and Omaha, Nebraska. Site development and other preparations are going smoothly”

“Our management team is committed to the development of our focused business strategy in a diligent fashion. AMCON’s culture of extreme dedication to customer service is what enables us to deliver consistent results. The depth and breadth of our customer relationships, in both our divisions, is an important and valuable asset as the merchant landscape remains highly competitive,” said Christopher H. Atayan, AMCON’s Chairman and Chief Executive Officer. “We carefully manage our balance sheet and pay particular attention to the risk adjusted return on capital we employ. This approach, consistently applied, has enabled us to develop shareholder value over the long term, while prudently managing risk,” noted Mr. Atayan.

“The price/value relationship of our products and services are extremely important to our customer base. We are in alignment with our customers and our key vendors to develop dynamic merchandising programs that foster customer profitability and growth. We continue to make investments in foodservice and information technology as a key component of our program development,” said Kathleen Evans, President of AMCON’s wholesale distribution segment.

“We are progressing toward the opening of our two new stores located in Northwest Arkansas and Omaha, Nebraska. Site development and other preparations are going smoothly,” said Eric Hinkefent, President of AMCON’s retail health food segment. “We continue to look for new locations which support our customer focused business model,” added Mr. Hinkefent.

“We were able to use our balance sheet strength to achieve several corporate objectives during the quarter. We negotiated the repurchase of 38,000 shares of preferred stock and 14,209 shares of common stock while at the same time taking advantage of attractive product related opportunities. At December 31, 2012, shareholders’ equity was $48.8 million and consolidated debt was $36.3 million,” said Andrew Plummer, AMCON’s Chief Financial Officer. “We continue to make a wide variety of capital investments that will enhance our ability to provide first class service and support to our customers,” added 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

Condensed Consolidated Balance Sheets

December 31, 2012 and September 30, 2012

   
December September
2012 2012
(Unaudited)
ASSETS
Current assets:
Cash $ 34,802 $ 491,387
Accounts receivable, less allowance for doubtful accounts of $1.3 million and $1.2 million at December 2012 and September 2012, respectively 32,335,062 32,681,835
Inventories, net 49,705,411 38,364,621
Deferred income taxes 1,618,414 1,916,619
Prepaid and other current assets   7,355,045     6,476,702  
Total current assets 91,048,734 79,931,164
 
Property and equipment, net 12,895,924 13,083,912
Goodwill 6,349,827 6,349,827
Other intangible assets, net 5,094,728 5,185,978
Other assets   441,409     1,258,985  
$ 115,830,622   $ 105,809,866  
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable $ 15,220,297 $ 17,189,208
Accrued expenses 5,709,984 6,931,859
Accrued wages, salaries and bonuses 2,146,303 2,503,361
Income taxes payable 625,784 2,194,966
Current maturities of long-term debt   1,192,560     1,182,829  

Total current liabilities

24,894,928 30,002,223
 
Credit facility 30,379,181 14,353,732
Deferred income taxes 3,754,812 3,633,390
Long-term debt, less current maturities 4,773,604 5,075,680
Other long-term liabilities 334,175 336,186
 

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 December 2012 and September 2012.

2,500,000 2,500,000

Series B cumulative, Convertible Preferred Stock, $.01 par value 80,000 shares authorized, 16,000 shares issued and outstanding at December 31, 2012 and 58,000 shares issued and outstanding at September 30, 2012, and a total liquidation preference of $0.4 million and $1.5 million at December 2012 and September 2012, respectively.

400,000 1,450,000
 

Shareholders’ equity:

Preferred stock, $0.01 par value, 1,000,000 shares authorized, 116,000 and 158,000 shares outstanding and issued in Series A and B referred to above

Common stock, $.01 par value, 3,000,000 shares authorized, 623,115 shares outstanding at December 2012 and 612,327 shares outstanding at September 2012

6,543 6,293
Additional paid-in capital 12,453,049 11,021,109
Retained earnings 39,635,286 38,349,253
Treasury stock at cost   (3,300,956 )   (918,000 )
Total shareholders’ equity   48,793,922     48,458,655  
$ 115,830,622   $ 105,809,866  
 

AMCON Distributing Company and Subsidiaries

Condensed Consolidated Unaudited Statements of Operations

for the three months ended December 31, 2012 and 2011

   
2012 2011
Sales (including excise taxes of $98.0 million and $90.5 million, respectively) $ 302,218,321 $ 283,563,050
Cost of sales   282,988,532     264,925,373  
Gross profit   19,229,789     18,637,677  
 
Selling, general and administrative expenses 15,848,472 15,350,002
Depreciation and amortization   593,862     613,494  
  16,442,334     15,963,496  
Operating income   2,787,455     2,674,181  
Other expense (income):
Interest expense 316,052 424,110
Other (income), net   (61,349 )   (151,264 )
  254,703     272,846  
Income from operations before income tax expense 2,532,752 2,401,335
Income tax expense   1,070,000     963,000  
Net income 1,462,752 1,438,335
Preferred stock dividend requirements   (59,291 )   (67,641 )
Net income available to common shareholders $ 1,403,461   $ 1,370,694  
 
 
Basic earnings per share available to common shareholders $ 2.26 $ 2.21
Diluted earnings per share available to common shareholders $ 1.90 $ 1.83
 
Basic weighted average shares outstanding 622,277 619,910
Diluted weighted average shares outstanding 767,957 783,994
 

AMCON Distributing Company and Subsidiaries

Condensed Consolidated Unaudited Statements of Cash Flows

for the three months ended December 31, 2012 and 2011

   
2012 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,462,752 $ 1,438,335

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

Depreciation 502,612 512,555
Amortization 91,250 100,939
Gain on sale of property and equipment (70,631 ) (3,600 )
Equity-based compensation 327,476 318,894
Deferred income taxes 419,627 449,159
Provision for losses on doubtful accounts 105,000 87,735
Provision for losses on inventory obsolescence 71,603 46,563
Other (2,011 ) (2,012 )
 
Changes in assets and liabilities:
Accounts receivable 241,773 3,652,086
Inventories (11,412,393 ) (9,538,609 )
Prepaid and other current assets (878,343 ) 1,122,163
Other assets 56,705 (4,175 )
Accounts payable (2,021,716 ) (2,586,190 )
Accrued expenses and accrued wages, salaries and bonuses (500,789 ) (1,731,517 )
Income tax payable   (1,569,182 )   (1,367,567 )
Net cash flows from operating activities (13,176,267 ) (7,505,241 )
 
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (330,228 ) (261,717 )
Proceeds from sales of property and equipment   139,040     3,600  
Net cash flows from investing activities (191,188 ) (258,117 )
 
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings on bank credit agreements 16,025,449 7,996,506
Principal payments on long-term debt (292,345 ) (410,772 )
Repurchase of Series B Convertible Preferred Stock and common stock (2,572,085 )
Dividends paid on convertible preferred stock (59,291 ) (67,641 )
Dividends on common stock (117,428 ) (119,313 )
Proceeds from exercise of stock options 1,180 1,180
Withholdings on the exercise of equity-based awards   (74,610 )   (51,452 )
Net cash flows from financing activities   12,910,870     7,348,508  
Net change in cash (456,585 ) (414,850 )
 

Cash, beginning of period

  491,387     1,389,665  
Cash, end of period $ 34,802   $ 974,815  
 
 
2012 2011
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ 279,667 $ 401,312
Cash paid during the period for income taxes 2,219,555 1,881,407
 
Supplemental disclosure of non-cash information:
Equipment acquisitions classified as accounts payable $ 64,042 $ 3,254
Issuance of common stock in connection with the vesting and exercise of equity-based awards 1,389,258 950,562
Conversion by holder of Series B Convertible Preferred Stock to common stock 100,000
Common stock acquired with other consideration 760,871

Contacts

AMCON Distributing Company
Christopher H. Atayan, 402-331-3727

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