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Mar 31, 2020
Pool Corp. Q1 2020 Earnings Report
Pool Corp. experienced record net sales for Q1 2020 with a 13% increase in both overall and base business sales growth and diluted EPS of $0.75.
Key Takeaways
Pool Corporation reported a strong start to 2020 with record net sales and growth in both overall and base business sales. The company's performance was driven by strong demand for discretionary products and favorable weather conditions. Despite the impact of stay-at-home orders in late March, Pool Corporation remains optimistic about its ability to deliver solid business results in 2020.
Net sales increased by 13% to a record $677.3 million compared to Q1 2019.
Diluted EPS was $0.75, compared to $0.80 in the previous year.
The company is continuously open in most markets with no major supply chain disruptions anticipated.
Updated 2020 earnings guidance to $5.30 - $5.90 per diluted share or $5.45 - $6.05, excluding non-cash impairments.
Forward Guidance
The company expects 2020 diluted EPS of $5.30 to $5.90, including the impact of first quarter tax benefits of $0.19 and the $0.15 impact of non-cash impairments recorded in the first quarter of 2020. Excluding the impact of non-cash impairments, the company expects 2020 adjusted diluted EPS of $5.45 to $6.05.
Positive Outlook
- Underlying demand for most discretionary products remains strong.
- Majority of business is driven by recurring revenue streams from the installed base of pools.
- Warehouses were already stocked with inventory in preparation for the upcoming peak season.
- Strong balance sheet and financial liquidity will allow the company to continue making strategic investments.
- Company is well positioned to take advantage of a return to more normal business conditions in the future.
Challenges Ahead
- Stay-at-home orders of varying degrees are now in place in almost all jurisdictions.
- Year-over-year sales declines for the month of April to date of five to ten percent.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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