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AMCON (DIT) Q3 Earnings Fall Y/Y on High SG&A Costs, Sales Rise
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AMCON Distributing Company (DIT - Free Report) reported its earnings for the fiscal third quarter ending Jun 30, 2024. The company achieved earnings per share (EPS) of $2.46, down significantly from $6.59 in the same quarter last year. The drop in EPS is primarily attributed to increased costs and expenses that outpaced revenue growth.
Sales for the quarter reached $717.9 million, up from $696.5 million in the prior-year period. This growth was driven by strong demand in the convenience and foodservice distribution sectors. However, the increase in sales was partially offset by the higher cost of goods sold, which rose to $669.9 million from $649.6 million in the third quarter of fiscal 2023.
The increase in sales indicates strong market demand, but the significant rise in selling, general, and administrative (SG&A) expenses and interest costs has compressed margins and profitability. The investments in technology and distribution capabilities are expected to yield long-term benefits, though they currently burden the financials. Management's focus on strategic acquisitions aims to enhance market presence and operational efficiency.
AMCON Distributing Company Price, Consensus and EPS Surprise
The company's gross profit for the third quarter of fiscal 2024 was $48 million, up from $46.9 million in the same quarter last year. The gross profit margin remained stable at approximately 6.7%, reflecting the company's ability to maintain its profitability amidst rising costs.
Operating Income
Operating income for third-quarter fiscal 2024 was $5.6 million, a decline from $7.9 million in the year-ago quarter. The reduction in operating income was primarily due to higher SG&A expenses.
Net Income
Net income available to common shareholders for third-quarter fiscal 2024 was $1.5 million, significantly lower than the $3.9 million reported in the year-ago quarter. This decrease in net income reflects the impact of higher interest expenses and other costs.
SG&A Expenses
SG&A expenses increased 8.3% year over year, reaching $39.9 million in third-quarter fiscal 2024 compared to $36.9 million in the prior-year quarter.
Interest Expenses
Interest expenses for the fiscal third quarter were $2.9 million, up from $2.4 million in the third quarter of fiscal 2023.
Balance Sheet Position (As of Jun 30, 2024)
AMCON exited the June quarter with cash of $0.7 million, down from $0.8 million as of Sep 30, 2023.
Total assets for the company were $400.6 million, an increase from $363.4 million at the end of September 2023.
AMCON’s long-term debt, excluding current maturities, of $17.9 million, denoted an increase from $11.7 million at the end of September 2023. Current maturities of long-term debt stood at $5.3 million.
Total shareholders' equity increased to $110 million from $104.2 million as of Sep 30, 2023.
Cash Flows
For the nine months ended Jun 30, 2024, AMCON generated net cash flows from operating activities of $26.9 million, a significant increase from $9.5 million in the same period of 2023.
Other Developments
During the quarter, AMCON completed the acquisition of Richmond Master Distributors Inc., which is expected to strengthen its distribution network and customer base. The company also reported progress on its new 175,000-square-foot distribution facility in Springfield, MO, and enhancements to its 250,000-square-foot facility in Colorado City, CO.
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AMCON (DIT) Q3 Earnings Fall Y/Y on High SG&A Costs, Sales Rise
AMCON Distributing Company (DIT - Free Report) reported its earnings for the fiscal third quarter ending Jun 30, 2024. The company achieved earnings per share (EPS) of $2.46, down significantly from $6.59 in the same quarter last year. The drop in EPS is primarily attributed to increased costs and expenses that outpaced revenue growth.
Sales for the quarter reached $717.9 million, up from $696.5 million in the prior-year period. This growth was driven by strong demand in the convenience and foodservice distribution sectors. However, the increase in sales was partially offset by the higher cost of goods sold, which rose to $669.9 million from $649.6 million in the third quarter of fiscal 2023.
The increase in sales indicates strong market demand, but the significant rise in selling, general, and administrative (SG&A) expenses and interest costs has compressed margins and profitability. The investments in technology and distribution capabilities are expected to yield long-term benefits, though they currently burden the financials. Management's focus on strategic acquisitions aims to enhance market presence and operational efficiency.
AMCON Distributing Company Price, Consensus and EPS Surprise
AMCON Distributing Company price-consensus-eps-surprise-chart | AMCON Distributing Company Quote
Key Business Metrics
Gross Profit
The company's gross profit for the third quarter of fiscal 2024 was $48 million, up from $46.9 million in the same quarter last year. The gross profit margin remained stable at approximately 6.7%, reflecting the company's ability to maintain its profitability amidst rising costs.
Operating Income
Operating income for third-quarter fiscal 2024 was $5.6 million, a decline from $7.9 million in the year-ago quarter. The reduction in operating income was primarily due to higher SG&A expenses.
Net Income
Net income available to common shareholders for third-quarter fiscal 2024 was $1.5 million, significantly lower than the $3.9 million reported in the year-ago quarter. This decrease in net income reflects the impact of higher interest expenses and other costs.
SG&A Expenses
SG&A expenses increased 8.3% year over year, reaching $39.9 million in third-quarter fiscal 2024 compared to $36.9 million in the prior-year quarter.
Interest Expenses
Interest expenses for the fiscal third quarter were $2.9 million, up from $2.4 million in the third quarter of fiscal 2023.
Balance Sheet Position (As of Jun 30, 2024)
AMCON exited the June quarter with cash of $0.7 million, down from $0.8 million as of Sep 30, 2023.
Total assets for the company were $400.6 million, an increase from $363.4 million at the end of September 2023.
AMCON’s long-term debt, excluding current maturities, of $17.9 million, denoted an increase from $11.7 million at the end of September 2023. Current maturities of long-term debt stood at $5.3 million.
Total shareholders' equity increased to $110 million from $104.2 million as of Sep 30, 2023.
Cash Flows
For the nine months ended Jun 30, 2024, AMCON generated net cash flows from operating activities of $26.9 million, a significant increase from $9.5 million in the same period of 2023.
Other Developments
During the quarter, AMCON completed the acquisition of Richmond Master Distributors Inc., which is expected to strengthen its distribution network and customer base. The company also reported progress on its new 175,000-square-foot distribution facility in Springfield, MO, and enhancements to its 250,000-square-foot facility in Colorado City, CO.