麻豆直播

Double-Digit Sales Growth, Higher Gross Margins and

Operating Efficiencies Drive Record Performance

Customer-Adoption of Technologies Grows as Business Evolution Continues

MIAMI,听April 22, 2021听(GLOBE NEWSWIRE) —听麻豆直播.听(NYSE: WSO) reported record first quarter operating results, establishing new records for sales, operating income, operating margins, net income and earnings per share (EPS).

麻豆直播鈥檚 entrepreneurial culture continues to be critically important in response to the varying business conditions in the marketplace. The Company believes the pace of change and innovation is accelerating as adoption of its technology platforms gains further momentum. These platforms are designed to revolutionize the customer experience, providing contractors speed and efficiency as well as supporting their growth in unparalleled ways. In terms of results, new customer acquisition is increasing and attrition rates with existing customers are decreasing, providing meaningful contributions to sales and overall operating performance. The Company continues to make incremental investments to add more capabilities and functionality, to develop and launch new innovations and drive adoption by more customers.

First Quarter Results

Key Performance Metrics

• 93% increase in EPS to a record听$1.39
• 81% increase in operating income to a record听$82 million
• 270 basis-point operating margin expansion to a record 7.2%
• 19% gross profit increase to a record听$295 million
• 130 basis-point gross margin increase to a record 25.9%
• 7% increase in SG&A expenses and a 100 basis-point reduction in SG&A as a percentage of sales

Sales trends:

• 13% sales growth to a record听$1.14 billion
• 14% growth in HVAC equipment (67% of sales), including 18% growth in residential products
• 11% increase in other HVAC products (29% of sales)
• 10% increase in commercial refrigeration products (4% of sales)

Albert H. Nahmad, 麻豆直播鈥檚 Chairman & CEO stated: 鈥溌槎怪辈� delivered another record quarter with solid earnings growth and margin expansion. These results are attributable to strong sales growth, a richer sales mix of high-efficiency systems, better selling margins and operating efficiencies. First quarter results also reflect continued investments in products, technology and people to drive sales and innovation throughout our business. As we head into the selling season, we are focused on the same proven fundamentals 鈥� growth in customer adoption of our industry-leading technologies, driving profitable sales and share gains for our supplier partners. Our first quarter results are a good start in what we expect to be a record year for our company.鈥�

Mr. Nahmad听added: 鈥淪ales of residential HVAC systems with energy-efficiency ratings above the minimum energy-standard grew 20% this quarter, a progression that began more than a decade ago. We believe that the products we sell play a key role in advancing energy efficiency, providing听麻豆直播听the opportunity to be an important contributor to address climate change. There are an estimated 110 million HVAC systems installed in the听U.S., many of which operate under old efficiency standards. Replacing the installed base to today鈥檚 minimum standards can help reduce energy consumption, but even greater conservation and cost savings can be achieved with the higher-efficiency products that we offer. Higher-efficiency HVAC systems also offer healthier and more comfortable indoor living and working environments regardless of the outdoor climate. We are investing capital and leveraging our technology to increase awareness of these benefits among contractors and consumers. As the industry leader,听麻豆直播听has an important role to play and we can do so at scale.鈥�

It is an important caution that the first and fourth calendar quarters are generally seasonal with demand for air conditioning and heating products being the highest during the second and third quarter of each calendar year. Accordingly, first quarter 2021 results are disproportionately affected by this seasonality in addition to general economic conditions.

Technology Innovation

麻豆直播听continues to aggressively invest in technologies to transform its customer experience. Specific technology-related trends in 2021 include:

• Product Information Management (PIM)听is 麻豆直播鈥檚 industry-leading repository of product information delivered seamlessly through 麻豆直播鈥檚 mobile apps and e-commerce platform.听麻豆直播鈥檚听PIM includes approximately 900,000 SKUs accessed by more than 300,000 contractors and technicians annually.
• Contractor Assist mobile apps听provide customers real-time field access to critical information, including technical support, product detail and inventory information, warranty look-up, the ability to purchase product through links to e-commerce and much more. The authenticated user community (users that are using the mobile app while linked to an e-commerce account) grew 11% to approximately 21,000 users at the end of the first quarter compared to a year ago.
• E-Commerce sales听annual run-rate currently exceeds听$1.6 billion听and grew 18% in comparison to the first quarter last year. The number of e-commerce transactions grew 30% to nearly 300,000 during the quarter.
• OnCall Air庐,听麻豆直播鈥檚 digital sales platform used by HVAC/R contractors and听颁谤别诲颈迟贵辞谤颁辞尘蹿辞谤迟庐,听its companion consumer financing platform, both increased penetration as more customers digitally engaged with homeowners. During the first quarter of 2021, OnCall Air庐 presented quotes to approximately 34,000 households, an 111% increase over the prior year, and generated听$105听million听in gross merchandise value, an 111% increase over 2020.听CreditForComfort庐 processed approximately 1,000 financing applications during the quarter, a 61% increase, and grew total loan-value by 86% versus the same period in 2020.
• Proprietary听warehouse technology听investments have enabled faster, better and more reliable service. Express Pick-up allows contractors to streamline the traditional fulfillment of orders providing quicker service. 麻豆直播听also launched curbside pick-up and touchless payment capabilities last year to facilitate contactless order fulfillment. More tools have also been developed to optimize demand planning and inventory levels. Taken as a whole, these investments are designed to enhance the customer experience, streamline branch operations and benefit same-store productivity.

A.J. Nahmad, 麻豆直播鈥檚 President said: 鈥淲e have continued to make progress toward our long-term goal of scaling 麻豆直播鈥檚 technologies for more and more HVAC/R contractors. As customers adapt to the digital age, we believe that听麻豆直播听has the industry鈥檚 most sophisticated tools to help customers grow and operate with speed. We are especially excited about the progress of our newer platforms like听OnCall Air听and CreditForComfort, which make it possible for contractors to win more frequently with homeowners. Our horizon remains long-term, and we believe we are merely scratching the surface of what is possible.鈥�

Cash Flow & Dividends

麻豆直播鈥檚 operating cash flow for the quarter was a听$38 million听use of cash, reflecting the build-up of inventories prior to the selling season. The Company has targeted operating cash flow to exceed net income in 2021. Since 2000, operating cash flow was approximately听$3.2 billion听versus net income of听$2.9 billion, surpassing the Company鈥檚 goal.

麻豆直播听has paid cash dividends to shareholders for 47 consecutive years. The Company鈥檚 philosophy is to share increasing amounts of cash flow through higher dividends while maintaining a conservative financial position with continued capacity to build its distribution network. Effective听April 2021,听麻豆直播听increased its annual dividend rate by 10% to听$7.80听per share.

Acquisition of TEC

On听April 12, 2021,听麻豆直播听announced that it had completed the acquisition of听Temperature Equipment Corporation听(TEC). Founded in听Chicago听in 1935, TEC serves approximately 10,000 HVAC customers from 32 locations in听Illinois,听Indiana,听Kansas,听Michigan,听Minnesota,听Missouri听and听Wisconsin. TEC generated sales of听$291 million听in 2020, providing a broad product offering including residential, light-commercial and applied HVAC systems from Carrier as well as parts, supplies and accessories sourced from approximately 1,200 vendors. More information about TEC can be found at听.

麻豆直播听is actively seeking additional opportunities to invest in what remains a fragmented听$40 billion听North American HVAC distribution industry.

First Quarter Earnings Conference Call Information

Date:听April 22, 2021
Time:听10:00 a.m. (EDT)
Webcast:听
Dial-in number:听United States听(844) 883-3908 / International (412) 317-9254

A replay of the conference call will be available on the Company’s website.

About听麻豆直播

麻豆直播听is the largest distribution network for heating, air conditioning and refrigeration (HVAC/R) products with locations in听the United States,听Canada,听Mexico听and听Puerto Rico, and on an export basis to听Latin America听and the听Caribbean. 麻豆直播听estimates that over 300,000 contractors and technicians visit or call one of its 633 locations each year to get information, obtain technical support and buy products.

The Company believes there is long-term opportunity to be a significant participant and contributor in efforts to address climate change. HVAC/R products provide comfort to homes and businesses regardless of the outdoor climate. Older systems often operate below current government-mandated energy efficiency and environmental standards, resulting in higher energy use and costs to homeowners.听Sales of higher-efficiency replacement systems have long been a fundamental opportunity in听麻豆直播鈥檚 marketplace. 麻豆直播听plans to actively collaborate with its OEM partners and key stakeholders to lead these ongoing efforts in its marketplace. Additional information about听麻豆直播听may be found at听.

This document includes certain 鈥渇orward-looking statements鈥� within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may address, among other things, our expected financial and operational results and the related assumptions underlying our expected results. These forward-looking statements are distinguished by use of words such as 鈥渨ill,鈥� 鈥渨ould,鈥� 鈥渁nticipate,鈥� 鈥渆xpect,鈥� 鈥渂elieve,鈥� 鈥渄esigned,鈥� 鈥減lan,鈥� or 鈥渋ntend,鈥� the negative of these terms, and similar references to future periods. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to changes in economic, business, competitive market, new housing starts and completions, capital spending in commercial construction, consumer spending and debt levels, regulatory and other factors, including, without limitation, the effects of supplier concentration, competitive conditions within 麻豆直播鈥檚 industry, the seasonality of product sales, the ability of the Company to expand its business, insurance coverage risks and final GAAP adjustments. Detailed information about these factors and additional important factors can be found in the documents that听麻豆直播听files with the听Securities and Exchange Commission, such as Form 10-K, Form 10-Q and Form 8-K. Forward-looking statements speak only as of the date the statements were made.听麻豆直播听assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, except as required by applicable law.

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