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AMCON Distributing Company Reports Results for the Quarter Ended December 31, 2020

AMCON Distributing Company (“AMCON”) (NYSE American: DIT), an Omaha, Nebraska based consumer products company, is pleased to announce fully diluted earnings per share of $5.57 on net income available to common shareholders of $3.1 million for its first fiscal quarter ended December 31, 2020.

“We are pleased with our results for the first fiscal quarter. AMCON faced a challenging operating environment. Our management team was able to deliver to our customers a safe and seamless level of customer service,” said Christopher H. Atayan, AMCON’s Chairman and Chief Executive Officer. Mr. Atayan further noted, “AMCON remains focused on our long term strategic initiatives. We continue to seek out acquisition opportunities for distributors who want to align with our growing platform and customer centric management philosophy.”

The wholesale distribution segment reported revenues of $393.6 million and operating income of $5.8 million for the first quarter of fiscal 2021. The retail health food segment reported revenues of $11.1 million and an operating loss of $0.1 million for the first quarter of fiscal 2021.

“We work interactively with our customers to develop customized foodservice and technology platforms. This collaborative approach enables our customers to enhance their profitability, which is especially important in light of rapidly changing market conditions. Our customer base continues to grow geographically and AMCON is deploying the capital and human resources necessary to support this growth,” said Andrew C. Plummer, AMCON’s President and Chief Operating Officer.

Charles J. Schmaderer, AMCON’s Chief Financial Officer said, “We are pleased with the progress of our strategic investment in Team Sledd, LLC. We ended the quarter with $65.6 million of shareholders’ equity and continue to work closely with our banking group to optimize our capital structure. During the quarter, we refinanced and extended the maturity of certain term loans allowing us to capitalize on the current interest rate environment.”

AMCON’s Healthy Edge Retail Group plays an important role in the health and wellness of the communities it serves. Throughout the pandemic, our management team has worked diligently to offer a continuous and safe shopping experience for customers. Our long term relationship with the organic/natural products vendor community has enabled our stores to meet the demands of our customers for total wellness solutions. Our strategy is to offer a broad selection of the highest quality organic and natural merchandise available supported by a high degree of customer service not found at other big box retailers within our industry.

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 twenty-one (21) health and natural product retail stores in the Midwest and Florida. The retail stores operate under the names Akin’s Natural Foods www.akins.com in its Midwest market, and Chamberlin's Natural Foods www.chamberlins.com and Earth Origins Market www.earthoriginsmarket.com in its Florida market.

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, 2020 and September 30, 2020

December

September

2020

2020

(Unaudited)

ASSETS

Current assets:

Cash

$

515,098

$

661,195

Accounts receivable, less allowance for doubtful accounts of $0.8 million at December 2020 and $0.9 million at September 2020

29,712,850

34,278,429

Inventories, net

67,832,187

98,971,773

Prepaid and other current assets

7,884,267

2,091,645

Total current assets

105,944,402

136,003,042

Property and equipment, net

17,171,501

17,497,274

Operating lease right-of-use assets, net

18,660,239

18,936,126

Note receivable

3,500,000

3,500,000

Goodwill

4,436,950

4,436,950

Other intangible assets, net

500,000

500,000

Equity method investment

7,189,433

6,744,095

Other assets

343,593

383,786

Total assets

$

157,746,118

$

188,001,273

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities:

Accounts payable

$

17,054,417

$

22,108,299

Accrued expenses

11,137,468

8,306,160

Accrued wages, salaries and bonuses

2,468,758

4,761,020

Income taxes payable

465,553

567,408

Current operating lease liabilities

5,756,176

5,607,098

Current maturities of long-term debt

512,344

516,850

Total current liabilities

37,394,716

41,866,835

Credit facility

33,051,949

61,971,682

Deferred income tax liability, net

1,939,311

1,806,575

Long-term operating lease liabilities

13,575,388

14,028,606

Long-term debt, less current maturities

5,477,181

2,608,794

Other long-term liabilities

757,387

927,241

Shareholders’ equity:

Preferred stock, $.01 par value, 1,000,000 shares authorized

Common stock, $.01 par value, 3,000,000 shares authorized, 551,369 shares outstanding at December 2020 and 537,715 shares outstanding at September 2020

8,834

8,697

Additional paid-in capital

25,007,239

24,282,058

Retained earnings

71,401,400

71,362,334

Treasury stock at cost

(30,867,287)

(30,861,549)

Total shareholders’ equity

65,550,186

64,791,540

Total liabilities and shareholders’ equity

$

157,746,118

$

188,001,273 

 

AMCON Distributing Company and Subsidiaries
Condensed Consolidated Unaudited Statements of Operations
for the three months ended December 31, 2020 and 2019

For the three months ended December

2020

2019

Sales (including excise taxes of $100.5 million and $94.0 million, respectively)

$

404,744,774

$

360,101,103

Cost of sales

381,282,795

339,256,392

Gross profit

23,461,979

20,844,711

Selling, general and administrative expenses

18,599,816

18,952,735

Depreciation and amortization

774,285

725,461

19,374,101

19,678,196

Operating income

4,087,878

1,166,515

Other expense (income):

Interest expense

376,430

472,423

Other (income), net

(41,823)

(6,778)

334,607

465,645

Income from operations before income taxes

3,753,271

700,870

Income tax expense

1,011,000

249,000

Equity method investment earnings, net of tax

335,339

Net income available to common shareholders

$

3,077,610

$

451,870

Basic earnings per share available to common shareholders

$

5.61

$

0.80

Diluted earnings per share available to common shareholders

$

5.57

$

0.80

Basic weighted average shares outstanding

548,125

562,578

Diluted weighted average shares outstanding

552,059

567,794

Dividends declared and paid per common share

$

0.18

$

0.18

 

AMCON Distributing Company and Subsidiaries
Condensed Consolidated Unaudited Statements of Shareholders’ Equity
for the three months ended December 31, 2020 and 2019

Additional

Common Stock

Treasury Stock

Paid-in

Retained

Shares

Amount

Shares

Amount

Capital

Earnings

Total

THREE MONTHS ENDED DECEMBER 2019

Balance, October 1, 2019

856,039

$

8,561

(303,425)

$

(28,831,855)

$

23,165,639

$

66,414,397

$

60,756,742

Dividends on common stock, $0.46 per share

(273,630)

(273,630)

Compensation expense and issuance of stock in connection with equity-based awards

13,328

131

1,027,315

1,027,446

Repurchase of common stock

(109)

(8,156)

(8,156)

Net income

451,870

451,870

Balance, December 31, 2019

869,367

$

8,692

(303,534)

$

(28,840,011)

$

24,192,954

$

66,592,637

$

61,954,272

THREE MONTHS ENDED DECEMBER 2020

Balance, October 1, 2020

869,867

$

8,697

(332,152)

$

(30,861,549)

$

24,282,058

$

71,362,334

$

64,791,540

Dividends on common stock, $5.18 per share

(3,038,544)

(3,038,544)

Compensation expense and issuance of stock in connection with equity-based awards

13,722

137

725,181

725,318

Repurchase of common stock

(68)

(5,738)

(5,738)

Net income

3,077,610

3,077,610

Balance, December 31, 2020

883,589

$

8,834

(332,220)

$

(30,867,287)

$

25,007,239

$

71,401,400

$

65,550,186

 

AMCON Distributing Company and Subsidiaries
Condensed Consolidated Unaudited Statements of Cash Flows
for the three months ended December 31, 2020 and 2019

December

December

2020

2019

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

$

3,077,610

$

451,870

Adjustments to reconcile net income from operations to net cash flows from (used in) operating activities:

Depreciation

774,285

725,461

Equity method investment earnings, net of tax

(335,339)

Loss (gain) on sales of property and equipment

(2,000)

Equity-based compensation

346,891

129,931

Deferred income taxes

132,736

154,792

Provision (recovery) for losses on doubtful accounts

(24,000)

371,000

Inventory allowance

172,137

51,587

Other

(42,011)

Changes in assets and liabilities:

Accounts receivable

4,589,579

(7,171,661)

Inventories

30,967,449

39,333,140

Prepaid and other current assets

(5,792,622)

(1,578,437)

Other assets

40,193

42,052

Accounts payable

(5,069,889)

(1,623,841)

Accrued expenses and accrued wages, salaries and bonuses

(1,793,704)

(2,509,401)

Other long-term liabilities

(169,854)

Income taxes payable and receivable

(211,854)

95,772

Net cash flows from (used in) operating activities

26,701,618

28,430,254

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property and equipment

(432,505)

(1,228,462)

Proceeds from sales of property and equipment

2,000

Net cash flows from (used in) investing activities

(430,505)

(1,228,462)

CASH FLOWS FROM FINANCING ACTIVITIES:

Borrowings under revolving credit facility

385,943,710

330,596,076

Repayments under revolving credit facility

(414,863,443)

(357,448,761)

Proceeds from borrowings on long-term debt

3,000,000

Principal payments on long-term debt

(136,119)

(131,580)

Repurchase of common stock

(5,738)

(8,156)

Dividends on common stock

(105,599)

(107,084)

Settlement and withholdings of equity-based awards

(250,021)

Net cash flows from (used in) financing activities

(26,417,210)

(27,099,505)

Net change in cash

(146,097)

102,287

Cash, beginning of period

661,195

337,704

Cash, end of period

$

515,098

$

439,991

Supplemental disclosure of cash flow information:

Cash paid during the period for interest

$

426,655

$

519,459

Cash paid (refunded) during the period for income taxes

1,090,119

(1,563)

Supplemental disclosure of non-cash information:

Equipment acquisitions classified in accounts payable

$

16,007

$

234,816

Dividends declared, not paid

2,932,945

166,546

Issuance of common stock in connection with the vesting and exercise of equity-based awards

949,812

990,653

 

Contacts:

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

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