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Mar 31, 2024
Watsco Q1 2024 Earnings Report
Watsco's Q1 2024 results were released, showcasing record first quarter sales and cash flow, driven by customer adoption of technology and strategic balance sheet management.
Key Takeaways
Watsco reported a 1% increase in revenues to a record $1.56 billion for Q1 2024. The company generated record first quarter operating cash flow of $104 million and strengthened its balance sheet with $479 million in cash and investments. EPS was $2.17 compared to $2.83 in the previous year.
Revenues increased by 1% to a record $1.56 billion.
Gross profit was $431 million with a gross margin of 27.5%.
Operating income reached $127 million, representing an operating margin of 8.1%.
The company generated a record $104 million in operating cash flow for the first quarter.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
Watsco is currently experiencing growth in end-market demand as it enters the summer selling season and believes market share gains are continuing.
Positive Outlook
- Continued growth and profitability in the years ahead supported by company-specific and industry-driven catalysts.
- Customers who become active users of our technology platforms produce stronger sales growth rates and exhibit approximately 50% reduced attrition.
- Increased technology adoption by more contractors will aid future growth and profitability and will lower the Company’s overall cost to serve.
- Sales of heat pump HVAC systems during the first quarter continued to outpace growth rates for conventional straight-cool HVAC systems.
- Sales of ductless HVAC systems during the first quarter continued to outpace growth rates of conventional ducted HVAC systems.
Challenges Ahead
- Softer market conditions persisted during what is essentially the low-season for product sales.
- Comparative results were impacted by approximately $5.3 million of non-recurring SG&A items.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
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