Yahoo Finance Pool Corp (POOL) Q4 Earnings And Revenues Miss Estimates
Pool Corporation POOL reported fourth-quarter 2022 results, with earnings and revenues missing the Zacks Consensus Estimate. The top line rose year over year, while the bottom line declined from the prior-year quarter's figure.
Peter D. Arvan, president and CEO, Pool Corp stated, “The relentless focus of our highly talented team on capacity creation and their dedication to serving our customers drove our operating income for the full year up 23% to a record $1.0 billion on top of 79% growth in 2021. We leveraged our strong capital position and operating capabilities to invest in inventory ahead of challenging supply chain and inflationary conditions to serve our customers and bring new products to the market in a dynamic environment.”
Earnings & Revenues Discussion
During the fourth quarter of 2022, the company reported adjusted earnings per share (EPS) of $1.79, missing the Zacks Consensus Estimate of $2.00. In the prior-year quarter, the company reported an adjusted EPS of $2.30.
Pool Corporation Price, Consensus and EPS Surprise
Pool Corporation price-consensus-eps-surprise-chart | Pool Corporation Quote
Quarterly net revenues of $1,095.9 million missed the consensus mark of $1,145 million. However, the top line increased 5.8% year over year. The upside can be primarily attributed to solid performance by the Base business and Excluded segments.
Segmental Performance
Pool reports operations under two segments — The Base Business (constituting most of the business) and the Excluded (sale centers excluded from the Base business).
During the fourth quarter, revenues in the Base Business segment inched up 1.4% year over year to $1,045.2 million. The segment’s operating income declined 20% year over year to $103.1 million. The operating margin contracted 260 basis points (bps) from the year-ago quarter’s level to 9.9%.
The Excluded segment reported net revenues of $50.7 million in the fourth quarter compared with $4.3 million reported in the prior-year quarter. During the quarter under review, the segment reported an operating income of $4.2 million against an operating loss of $1 million reported in the prior-year quarter. The segment’s operating margin came in at 8.2% against (22.9)% reported in the prior-year quarter.
Operating Highlights & Expenses
During the fourth quarter, the cost of sales came in at $780.2 million, up 9.4% from the prior-year quarter’s level. During the quarter, gross profits (as a percentage of net sales) decreased 230 bps year over year to 28.8% from 31.1% reported in the year-ago quarter. Selling and administrative expenses increased 7.2% year over year to $208.4 million.
During the fourth quarter, operating income declined 16.1% year over year to $107.3 million. The operating margin declined 250 bps to 9.8% from the prior-year quarter’s level.
Net income during the quarter totaled $71.9 million, up from $107.6 million reported in the year-ago quarter.
Balance Sheet
As of Dec 31, 2022, the company’s cash and cash equivalents amounted to $45.6 million compared with $24.3 million as of Dec 31, 2021. During the quarter, its net long-term debt amounted to $1,361.8 million compared with $ 1,171.6 million reported in the prior-year quarter. Goodwill during the quarter came in at $692 million compared with $688.4 million reported in the prior-year quarter.
For the 12 months ended Dec 31, 2022, net cash provided by operating activities amounted to $484.9 million compared with $313.5 million reported in the prior-year period.
2022 Highlights
Net sales in 2022 came in at $6,179.7 million compared with $5,295.6 million in 2021.
Operating income in 2022 came in at $1,025.8 million compared with $832.8 million in 2021.
In 2022, adjusted EPS came in at $18.43 compared with $15.23 in the previous year.
2023 Guidance
For 2023, Pool Corp expects adjusted diluted EPS in the range of $16-$17. The Zacks Consensus Estimate for 2023 earnings is currently pegged at $16.45.
Zacks Rank & Key Picks
Pool Corp currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Zacks Consumer Discretionary sector are OneSpaWorld Holdings Limited. OSW, Las Vegas Sands Corp. LVS and Playa Hotels & Resorts N.V. PLYA.
OneSpaWorld currently sports a Zacks Rank #1. OSW has a trailing four-quarter earnings surprise of 84.2%, on average. Shares of the company have increased 5% in the past year.
The Zacks Consensus Estimate for OSW’s 2023 sales and EPS indicates a rise of 24.5% and 87.5%, respectively, from the year-ago period’s levels.
Las Vegas Sands sports a Zacks Rank #1. LVS has a long-term earnings growth rate of 4.9%. The stock has increased 20.7% in the past year.
The Zacks Consensus Estimate for LVS’ 2023 sales and EPS indicates a rise of 100.8% and 217.5%, respectively, from the year-ago period’s estimated levels.
Playa Hotels carries a Zacks Rank #2 (Buy). PLYA has a trailing four-quarter earnings surprise of 19.4%, on average. Shares of the company have declined 7.2% in the past year.
The Zacks Consensus Estimate for PLYA’s 2023 sales and EPS indicates a rise of 7.9% and 26.3%, respectively, from the year-ago levels.
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Pool Corporation (POOL) : Free Stock Analysis Report
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