Somero Enterprises Inc. – Final Results

Somero Enterprises Inc. – Final Results

Somero Enterprises, Inc. is pleased to report its annual results for the twelve months ended December 31, 2018.

Financial Highlights

  • Delivered a year of record annual revenue and profit
  • Strong financial position, with a record level of cash flow generation and US$ 28.2m net cash on the balance sheet
  • Substantial return of cash to shareholders:
  • Paid US$ 12.3m in dividends to shareholders in 2018 (2017: US$ 13.9m that included a US$ 7.5m special dividend in August 2017)

FY18

FY1

% Increase

Revenue

US$94.0m

US$85.6m

10%

Adjusted EBITDA(1,2)

US$30.8m

US$28.0m

10%

Adjusted EBITDA margin(1,2)

33%

33%

Profits before tax

US$29.1m

US$25.7m

13%

Adjusted net income(1,3)

US$21.4m

US$17.5m

22%

Diluted adjusted net income per share(1,3)

US$0.38

US$0.31

23%

Cash flow from operating activities

US$23.8m

US$20.0m

19%

Net cash(4)

US$28.2m

US$19.0m

48%

Ordinary dividend per share

US$0.190

US$0.155

23%

Supplemental dividend per share

US$0.117

US$0.036

225%

 Operational Highlights

  • Healthy demand across markets and product lines:
  • Growth in 2018 predominately led by North America and the Rest of World markets
  • Sales of Boomed screeds grew 9% to US$ 39.2m (2017: US$ 35.9m)
  • Sales of Ride-on screeds grew 23% to US$ 22.9m (2017: US$ 18.6m)
  • New products contributed meaningfully to growth
  • Sales of the S-22EZ and SP-16 Line Pulling & Placing System combined to contribute US$ 3.0m to 2018 growth

Post-Period Highlights

  • Acquired Line Dragon ® business assets (“Line Dragon”) in January 2019 to complement Somero’s SP-16 Line Pulling & Placing System product offering
  • Launch of the SkyScreed ® 25 at the January 2019 World of Concrete trade show in Las Vegas, USA generating significant attention and interest

Notes:
1. The Company uses non-US GAAP financial measures to provide supplemental information regarding the Company’s operating performance. See further information regarding non-GAAP measures below.
2.  Adjusted EBITDA as used herein is a calculation of the Company’s net income plus tax provision, interest expense, interest income, foreign exchange loss, other expense, depreciation, amortization, and stock-based compensation.
3. Adjusted net income as used herein is a calculation of net income plus amortization of intangibles and excluding the tax impact of stock option and RSU settlements and other special items.
4.  Net cash is defined as cash and cash equivalents less borrowings under bank obligations exclusive of deferred financing costs. 

Jack Cooney, CEO of Somero, said: 

“2018 was a record year for Somero by all measures. We delivered record revenues of US$ 94.0m, comfortably surpassing the 5-year strategic target we set out in 2014 to reach US$ 90.0m in revenue by 2018.  These revenues translated to record profits and cash flow from operations and allowed for the return of a significant amount of cash to shareholders in the period.

During the year we completed the design and development of the SkyScreed® 25, the world’s first Laser Screed® machine for use in structural high-rise applications.  This opens an exciting new market segment for the Company and starts the next chapter in Somero’s product development. Additionally, in January 2019 we completed the acquisition of Line Dragon to complement and enhance Somero’s current SP-16 Line Pulling & Placing System product offering.

We accomplished much in 2018, but what I am most pleased about is that throughout the year we remained focused on our mission to help our customers build successful, profitable businesses. This focus is reflected by our employees’ unrelenting commitment to this goal, a passion that earns the loyalty of our customers and delivers these exceptional results for our shareholders.

Somero begins 2019 financially stronger than ever and well-positioned to capture growth in new and existing markets with a strong product offering. With the opportunities that lie ahead and the steps we have taken to position the Company for the future, I am confident the Company will deliver strong results and dividends for our shareholders.”

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