XPEL’s Q3 Results Take Hit from Weak Canadian Dollar

December 9th, 2015 by Casey Flores

Had Canada’s currency not weakened, XPEL would have had an extra impressive third quarter.

The San Antonio-based company that’s traded on the Canadian stock exchange still saw growth in key metrics, though. Ryan Pape, president and CEO, says, “Revenue increased 35 percent and net income grew 44 percent on a constant currency basis, reflecting the progress we are making in the U.S. and abroad. Brand awareness and the reputation of the XPEL product continue to increase as we reach more customers around the world, and our focus on enhancing the product line and distribution channels positions us well for continued growth.”

Financial Results for the Third Quarter:

Year20142015Percent Change
Revenue$8.4 million$10.9 million+29
Gross Margin (as a percent of sales)31 percent30 percent-1
Expenses (as a percentage of revenue)23 percent24 percent+1
Net Earnings$473,296$398,092-16
EBITDA (earnings before interest, tax, depreciation and amortization)$862,729$914,484+6

 The release containing the results explained that net earnings and EBITDA increased 44 percent and 52 percent respectively “on a constant currency basis,” (meaning had the Canadian dollar not dropped in value).

Pape says the company is seeing growth in China and Canada.

“In China, sales increased sequentially as a result of a realigned distribution strategy which is already providing a better platform for us as we grow into that market,” he explains. “In Canada, the Parasol acquisition which we consummated in the first quarter has proven to be a great strategic move for the company, although the weakness in the Canadian dollar continues to impact our consolidated results. Nonetheless, the acquisition has been quite accretive on a constant currency basis.”

He also says the company’s new window film line is showing signs of a good investment.

“During the quarter, we soft launched a window film line and the initial feedback has been very positive,” he says. “This is as a complimentary product line and one which is used by many of our customers.”

Pape says the company is “in the process of rolling out a new ordering and account management portal in the fourth quarter.”

Tags: , , ,

Leave Comment