☒ | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
☐ | Transition Report Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common stock, $0.50 par value | WSO | New York Stock Exchange | ||
Class B common stock, $0.50 par value | WSOB | New York Stock Exchange |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
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Item 6. | ||||||
ITEM 1. | CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS |
Quarter Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenues | $ | 1,782,569 | $ | 1,536,671 | $ | 4,768,327 | $ | 3,900,212 | ||||||||
Cost of sales | 1,299,905 | 1,162,908 | 3,512,901 | 2,959,635 | ||||||||||||
Gross profit | 482,664 | 373,763 | 1,255,426 | 940,577 | ||||||||||||
Selling, general and administrative expenses | 281,922 | 221,037 | 766,231 | 618,476 | ||||||||||||
Other income | 6,057 | 4,055 | 16,267 | 9,172 | ||||||||||||
Operating income | 206,799 | 156,781 | 505,462 | 331,273 | ||||||||||||
Interest expense, net | 221 | 108 | 757 | 1,181 | ||||||||||||
Income before income taxes | 206,578 | 156,673 | 504,705 | 330,092 | ||||||||||||
Income taxes | 41,734 | 30,467 | 101,601 | 63,397 | ||||||||||||
Net income | 164,844 | 126,206 | 403,104 | 266,695 | ||||||||||||
Less: net income attributable to non-controlling interest | 23,979 | 19,717 | 63,045 | 43,126 | ||||||||||||
Net income attributable to Watsco, Inc. | $ | 140,865 | $ | 106,489 | $ | 340,059 | $ | 223,569 | ||||||||
Earnings per share for Common and Class B common stock: | ||||||||||||||||
Basic | $ | 3.64 | $ | 2.77 | $ | 8.80 | $ | 5.83 | ||||||||
Diluted | $ | 3.62 | $ | 2.76 | $ | 8.75 | $ | 5.82 | ||||||||
Quarter Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net income | $ | 164,844 | $ | 126,206 | $ | 403,104 | $ | 266,695 | ||||||||
Other comprehensive (loss) income, net of tax | ||||||||||||||||
Foreign currency translation adjustment | (8,219 | ) | 5,514 | (746 | ) | (6,592 | ) | |||||||||
Unrealized (loss) gain on cash flow hedging instruments | 0 | (416 | ) | 70 | 948 | |||||||||||
Reclassification of (gain) loss on cash flow hedging instruments into earnings | 0 | (509 | ) | 221 | (691 | ) | ||||||||||
Other comprehensive (loss) income | (8,219 | ) | 4,589 | (455 | ) | (6,335 | ) | |||||||||
Comprehensive income | 156,625 | 130,795 | 402,649 | 260,360 | ||||||||||||
Less: comprehensive income attributable to non-controlling interest | 21,114 | 21,283 | 62,821 | 40,986 | ||||||||||||
Comprehensive income attributable to Watsco, Inc. | $ | 135,511 | $ | 109,512 | $ | 339,828 | $ | 219,374 | ||||||||
September 30, 2021 | December 31, 2020 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 137,201 | $ | 146,067 | ||||
Accounts receivable, net | 771,042 | 535,288 | ||||||
Inventories, net | 1,042,144 | 781,299 | ||||||
Other current assets | 30,474 | 21,791 | ||||||
Total current assets | 1,980,861 | 1,484,445 | ||||||
Property and equipment, net | 105,842 | 98,225 | ||||||
Operating lease right-of-use | 262,965 | 209,169 | ||||||
Goodwill | 432,514 | 412,486 | ||||||
Intangible assets, net | 187,662 | 169,929 | ||||||
Investment in unconsolidated entity | 111,776 | 97,847 | ||||||
Other assets | 9,301 | 12,246 | ||||||
$ | 3,090,921 | $ | 2,484,347 | |||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Current portion of long-term obligations | $ | 82,712 | $ | 71,804 | ||||
Accounts payable | 454,498 | 251,553 | ||||||
Accrued expenses and other current liabilities | 259,483 | 163,788 | ||||||
Total current liabilities | 796,693 | 487,145 | ||||||
Long-term obligations: | ||||||||
Borrowings under revolving credit agreement | 1,724 | 0 | ||||||
Operating lease liabilities, net of current portion | 182,772 | 139,527 | ||||||
Finance lease liabilities, net of current portion | 6,676 | 4,811 | ||||||
Total long-term obligations | 191,172 | 144,338 | ||||||
Deferred income taxes and other liabilities | 81,531 | 73,103 | ||||||
Commitments and contingencies | 0 | 0 | ||||||
Watsco, Inc. shareholders’ equity: | ||||||||
Common stock, $0.50 par value | 18,913 | 18,851 | ||||||
Class B common stock, $0.50 par value | 2,904 | 2,846 | ||||||
Preferred stock, $0.50 par value | 0 | 0 | ||||||
Paid-in capital | 988,310 | 950,915 | ||||||
Accumulated other comprehensive loss, net of tax | (35,098 | ) | (34,867 | ) | ||||
Retained earnings | 756,992 | 636,373 | ||||||
Treasury stock, at cost | (87,440 | ) | (87,440 | ) | ||||
Total Watsco, Inc. shareholders’ equity | 1,644,581 | 1,486,678 | ||||||
Non-controlling interest | 376,944 | 293,083 | ||||||
Total shareholders’ equity | 2,021,525 | 1,779,761 | ||||||
$ | 3,090,921 | $ | 2,484,347 | |||||
(In thousands, except share and | Common Stock, Class B Common Stock and Preferred Stock Shares | Common Stock, Class B Common Stock and Preferred Stock Amount | Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Non-controlling Interest | Total | ||||||||||||||||||||||||
Balance at December 31, 2020 | 38,521,694 | $ | 21,697 | $ | 950,915 | $ | (34,867 | ) | $ | 636,373 | $ | (87,440 | ) | $ | 293,083 | $ | 1,779,761 | |||||||||||||||
Net income | 55,092 | 11,035 | 66,127 | |||||||||||||||||||||||||||||
Other comprehensive income | 2,474 | 1,302 | 3,776 | |||||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 121,934 | 61 | (61 | ) | — | |||||||||||||||||||||||||||
Forfeitures of non-vested restricted shares of common stock | (43,000 | ) | (21 | ) | 21 | — | ||||||||||||||||||||||||||
Common stock contribution to 401(k) plan | 22,752 | 11 | 5,143 | 5,154 | ||||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 24,735 | 12 | 3,862 | 3,874 | ||||||||||||||||||||||||||||
Share-based compensation | 6,656 | 6,656 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.775 per share | (68,521 | ) | (68,521 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2021 | 38,648,115 | 21,760 | 966,536 | (32,393 | ) | 622,944 | (87,440 | ) | 305,420 | 1,796,827 | ||||||||||||||||||||||
Net income | 144,102 | 28,031 | 172,133 | |||||||||||||||||||||||||||||
Other comprehensive income | 2,649 | 1,339 | 3,988 | |||||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 44,881 | 22 | (22 | ) | — | |||||||||||||||||||||||||||
Forfeitures of non-vested restricted shares of common stock | (7,589 | ) | (4 | ) | 4 | — | ||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 34,311 | 18 | 5,658 | 5,676 | ||||||||||||||||||||||||||||
Retirement of common stock | (2,965 | ) | (1 | ) | (862 | ) | (863 | ) | ||||||||||||||||||||||||
Share-based compensation | 5,569 | 5,569 | ||||||||||||||||||||||||||||||
Common stock issued for Acme Refrigeration of Baton Rouge LLC | 8,492 | 4 | 2,547 | 2,551 | ||||||||||||||||||||||||||||
Investment in TEC Distribution LLC | 21,040 | 21,040 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.95 per share | (75,388 | ) | (75,388 | ) | ||||||||||||||||||||||||||||
Balance at June 30, 2021 | 38,725,245 | 21,799 | 979,430 | (29,744 | ) | 691,658 | (87,440 | ) | 355,830 | 1,931,533 | ||||||||||||||||||||||
Net income | 140,865 | 23,979 | 164,844 | |||||||||||||||||||||||||||||
Other comprehensive loss | (5,354 | ) | (2,865 | ) | (8,219 | ) | ||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 21,828 | 11 | (11 | ) | — | |||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 14,413 | 7 | 2,480 | 2,487 | ||||||||||||||||||||||||||||
Retirement of common stock | (3,250 | ) | (2 | ) | (892 | ) | (894 | ) | ||||||||||||||||||||||||
Share-based compensation | 6,308 | 6,308 | ||||||||||||||||||||||||||||||
Common stock issued for Makdad Industrial Supply Co., Inc. | 3,627 | 2 | 995 | 997 | ||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.95 per share | (75,531 | ) | (75,531 | ) | ||||||||||||||||||||||||||||
Balance at September 30, 2021 | 38,761,863 | $ | 21,817 | $ | 988,310 | $ | (35,098 | ) | $ | 756,992 | $ | (87,440 | ) | $ | 376,944 | $ | 2,021,525 | |||||||||||||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Revenues | $ | 2,133,755 | $ | 1,849,640 | $ | 3,657,325 | $ | 2,985,758 | ||||||||
Cost of sales | 1,538,222 | 1,371,699 | 2,611,434 | 2,212,996 | ||||||||||||
Gross profit | 595,533 | 477,941 | 1,045,891 | 772,762 | ||||||||||||
Selling, general and administrative expenses | 314,753 | 266,697 | 598,107 | 484,309 | ||||||||||||
Other income | 6,317 | 5,539 | 10,362 | 10,210 | ||||||||||||
Operating income | 287,097 | 216,783 | 458,146 | 298,663 | ||||||||||||
Interest expense, net | 1,110 | 448 | 1,668 | 536 | ||||||||||||
Income before income taxes | 285,987 | 216,335 | 456,478 | 298,127 | ||||||||||||
Income taxes | 60,481 | 44,202 | 96,082 | 59,867 | ||||||||||||
Net income | 225,506 | 172,133 | 360,396 | 238,260 | ||||||||||||
Less: net income attributable to non-controlling interest | 32,949 | 28,031 | 54,541 | 39,066 | ||||||||||||
Net income attributable to Watsco, Inc. | $ | 192,557 | $ | 144,102 | $ | 305,855 | $ | 199,194 | ||||||||
Earnings per share for Common and Class B common stock: | ||||||||||||||||
Basic | $ | 4.94 | $ | 3.73 | $ | 7.86 | $ | 5.16 | ||||||||
Diluted | $ | 4.93 | $ | 3.71 | $ | 7.83 | $ | 5.13 | ||||||||
(In thousands, except share and per share data) | Common Stock, Class B Common Stock and Preferred Stock Shares | Common Stock, Class B Common Stock and Preferred Stock Amount | Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Non-controlling Interest | Total | ||||||||||||||||||||||||
Balance at December 31, 2019 | 38,194,056 | $ | 21,533 | $ | 907,877 | $ | (39,050 | ) | $ | 632,507 | $ | (87,440 | ) | $ | 279,340 | $ | 1,714,767 | |||||||||||||||
Net income | 30,502 | 5,745 | 36,247 | |||||||||||||||||||||||||||||
Other comprehensive (loss) | (12,739 | ) | (6,541 | ) | (19,280 | ) | ||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 113,765 | 57 | (57 | ) | — | |||||||||||||||||||||||||||
Common stock contribution to 401(k) plan | 25,216 | 13 | 4,530 | 4,543 | ||||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 18,674 | 9 | 2,532 | 2,541 | ||||||||||||||||||||||||||||
Retirement of common stock | (4,828 | ) | (2 | ) | (789 | ) | (791 | ) | ||||||||||||||||||||||||
Share-based compensation | 6,097 | 6,097 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.60 per share | (61,238 | ) | (61,238 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2020 | 38,346,883 | 21,610 | 920,190 | (51,789 | ) | 601,771 | (87,440 | ) | 278,544 | 1,682,886 | ||||||||||||||||||||||
Net income | 86,578 | 17,664 | 104,242 | |||||||||||||||||||||||||||||
Other comprehensive income | 5,521 | 2,835 | 8,356 | |||||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 15,500 | 8 | (8 | ) | — | |||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 32,073 | 16 | 4,529 | 4,545 | ||||||||||||||||||||||||||||
Retirement of common stock | (6,377 | ) | (4 | ) | (1,092 | ) | (1,096 | ) | ||||||||||||||||||||||||
Share-based compensation | 5,226 | 5,226 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.775 per share | (68,077 | ) | (68,077 | ) | ||||||||||||||||||||||||||||
Balance at June 30, 2020 | 38,388,079 | 21,630 | 928,845 | (46,268 | ) | 620,272 | (87,440 | ) | 299,043 | 1,736,082 | ||||||||||||||||||||||
Net income | 106,489 | 19,717 | 126,206 | |||||||||||||||||||||||||||||
Other comprehensive income | 3,023 | 1,566 | 4,589 | |||||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 20,000 | 10 | (10 | ) | — | |||||||||||||||||||||||||||
Forfeitures of non-vested restricted shares of common stock | (3,589 | ) | (2 | ) | 2 | — | ||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 55,473 | 28 | 8,438 | 8,466 | ||||||||||||||||||||||||||||
Retirement of common stock | (11,943 | ) | (6 | ) | (2,749 | ) | (2,755 | ) | ||||||||||||||||||||||||
Share-based compensation | 5,489 | 5,489 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.775 per share | (68,139 | ) | (68,139 | ) | ||||||||||||||||||||||||||||
Balance at September 30, 2020 | 38,448,020 | $ | 21,660 | $ | 940,015 | $ | (43,245 | ) | $ | 658,622 | $ | (87,440 | ) | $ | 320,326 | $ | 1,809,938 | |||||||||||||||
Nine Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 403,104 | $ | 266,695 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 20,874 | 19,350 | ||||||
Share-based compensation | 18,659 | 15,802 | ||||||
Non-cash contribution to 401(k) plan | 5,154 | 4,543 | ||||||
Deferred income tax provision | 3,966 | 3,177 | ||||||
Other income from investment in unconsolidated entity | (16,267 | ) | (9,172 | ) | ||||
Other, net | 1,969 | 1,776 | ||||||
Changes in operating assets and liabilities, net of effects of acquisitions: | ||||||||
Accounts receivable, net | (198,011 | ) | (113,017 | ) | ||||
Inventories, net | (170,662 | ) | 34,448 | |||||
Accounts payable and other liabilities | 263,752 | 158,094 | ||||||
Other, net | (12,866 | ) | (8,918 | ) | ||||
Net cash provided by operating activities | 319,672 | 372,778 | ||||||
Cash flows from investing activities: | ||||||||
Business acquisitions, net of cash acquired | (129,462 | ) | 0 | |||||
Capital expenditures | (16,770 | ) | (11,608 | ) | ||||
Proceeds from sale of property and equipment | 108 | 61 | ||||||
Proceeds from sale of equity securities | 5,993 | 0 | ||||||
Net cash used in investing activities | (140,131 | ) | (11,547 | ) | ||||
Cash flows from financing activities: | ||||||||
Dividends on Common and Class B common stock | (219,440 | ) | (197,454 | ) | ||||
Net repayments of finance lease liabilities | (1,482 | ) | (1,003 | ) | ||||
Repurchases of common stock to satisfy employee withholding tax obligations | (894 | ) | (2,299 | ) | ||||
Payment of fees related to revolving credit agreement | (22 | ) | (189 | ) | ||||
Net proceeds (repayments) under revolving credit agreement | 1,724 | (155,032 | ) | |||||
Net proceeds from issuances of common stock | 11,173 | 13,207 | ||||||
Proceeds from non-controlling interest for investment in TEC Distribution LLC | 21,040 | 0— | ||||||
Net cash used in financing activities | (187,901 | ) | (342,770 | ) | ||||
Effect of foreign exchange rate changes on cash and cash equivalents | (506 | ) | (315 | ) | ||||
Net (decrease) increase in cash and cash equivalents | (8,866 | ) | 18,146 | |||||
Cash and cash equivalents at beginning of period | 146,067 | 74,454 | ||||||
Cash and cash equivalents at end of period | $ | 137,201 | $ | 92,600 | ||||
Supplemental cash flow information: | ||||||||
Common stock issued for Acme Refrigeration of Baton Rouge LLC | $ | 2,551 | — | |||||
Common stock issued for Makdad Industrial Supply Co., Inc. | $ | 997 | — |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Net income | $ | 225,506 | $ | 172,133 | $ | 360,396 | $ | 238,260 | ||||||||
Other comprehensive (loss) income, net of tax | ||||||||||||||||
Foreign currency translation adjustment | (9,381 | ) | 4,016 | (5,000 | ) | 7,473 | ||||||||||
Unrealized (loss) gain on cash flow hedging instruments | — | (6 | ) | — | 70 | |||||||||||
Reclassification of (gain) loss on cash flow hedging instruments into earnings | — | (22 | ) | — | 221 | |||||||||||
Other comprehensive (loss) income | (9,381 | ) | 3,988 | (5,000 | ) | 7,764 | ||||||||||
Comprehensive income | 216,125 | 176,121 | 355,396 | 246,024 | ||||||||||||
Less: comprehensive income attributable to non-controlling interest | 29,833 | 29,370 | 52,871 | 41,707 | ||||||||||||
Comprehensive income attributable to Watsco, Inc. | $ | 186,292 | $ | 146,751 | $ | 302,525 | $ | 204,317 | ||||||||
June 30, 2022 | December 31, 2021 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 129,049 | $ | 118,268 | ||||
Accounts receivable, net | 983,033 | 698,456 | ||||||
Inventories, net | 1,480,519 | 1,115,469 | ||||||
Other current assets | 31,330 | 29,207 | ||||||
Total current assets | 2,623,931 | 1,961,400 | ||||||
Property and equipment, net | 119,525 | 111,019 | ||||||
Operating lease right-of-use | 298,223 | 268,528 | ||||||
Goodwill | 432,777 | 434,019 | ||||||
Intangible assets, net | 183,133 | 186,896 | ||||||
Investment in unconsolidated entity | 122,831 | 114,808 | ||||||
Other assets | 8,172 | 9,191 | ||||||
$ | 3,788,592 | $ | 3,085,861 | |||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Current portion of long-term obligations | $ | 88,600 | $ | 84,501 | ||||
Accounts payable | 625,962 | 364,185 | ||||||
Accrued expenses and other current liabilities | 346,781 | 278,036 | ||||||
Total current liabilities | 1,061,343 | 726,722 | ||||||
Long-term obligations: | ||||||||
Borrowings under revolving credit agreement | 203,600 | 89,000 | ||||||
Operating lease liabilities, net of current portion | 213,344 | 187,024 | ||||||
Finance lease liabilities, net of current portion | 10,204 | 9,189 | ||||||
Total long-term obligations | 427,148 | 285,213 | ||||||
Deferred income taxes and other liabilities | 80,326 | 76,511 | ||||||
Commitments and contingencies | 0 | 0 | ||||||
Watsco, Inc. shareholders’ equity: | ||||||||
Common stock, $0.50 par value | 19,007 | 18,941 | ||||||
Class B common stock, $0.50 par value | 2,918 | 2,895 | ||||||
Preferred stock, $0.50 par value | — | — | ||||||
Paid-in capital | 1,032,291 | 1,003,932 | ||||||
Accumulated other comprehensive loss, net of tax | (37,506 | ) | (34,176 | ) | ||||
Retained earnings | 905,167 | 760,796 | ||||||
Treasury stock, at cost | (87,440 | ) | (87,440 | ) | ||||
Total Watsco, Inc. shareholders’ equity | 1,834,437 | 1,664,948 | ||||||
Non-controlling interest | 385,338 | 332,467 | ||||||
Total shareholders’ equity | 2,219,775 | 1,997,415 | ||||||
$ | 3,788,592 | $ | 3,085,861 | |||||
(In thousands, except share and per share data) | Common Stock, Class B Common Stock and Preferred Stock Shares | Common Stock, Class B Common Stock and Preferred Stock Amount | Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Non- Interest | Total | ||||||||||||||||||||||||
Balance at December 31, 2021 | 38,799,632 | $ | 21,836 | $ | 1,003,932 | $ | (34,176 | ) | $ | 760,796 | $ | (87,440 | ) | $ | 332,467 | $ | 1,997,415 | |||||||||||||||
Net income | 113,298 | 21,592 | 134,890 | |||||||||||||||||||||||||||||
Other comprehensive income | 2,935 | 1,446 | 4,381 | |||||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 105,882 | 53 | (53 | ) | — | |||||||||||||||||||||||||||
Common stock contribution to 401(k) plan | 21,532 | 11 | 6,726 | 6,737 | ||||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 24,850 | 12 | 4,408 | 4,420 | ||||||||||||||||||||||||||||
Share-based compensation | 8,667 | 8,667 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.95 per share | (75,795 | ) | (75,795 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2022 | 38,951,896 | 21,912 | 1,023,680 | (31,241 | ) | 798,299 | (87,440 | ) | 355,505 | 2,080,715 | ||||||||||||||||||||||
Net income | 192,557 | 32,949 | 225,506 | |||||||||||||||||||||||||||||
Other comprehensive (loss) | (6,265 | ) | (3,116 | ) | (9,381 | ) | ||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 21,177 | 11 | (11 | ) | — | |||||||||||||||||||||||||||
Forfeitures of non-vested restricted shares of common stock | (10,000 | ) | (5 | ) | 5 | — | ||||||||||||||||||||||||||
Common stock contribution to 401(k) plan | 28 | — | 9 | 9 | ||||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 21,939 | 11 | 3,796 | 3,807 | ||||||||||||||||||||||||||||
Retirement of common stock | (8,181 | ) | (4 | ) | (2,175 | ) | (2,179 | ) | ||||||||||||||||||||||||
Share-based compensation | 6,987 | 6,987 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $2.20 per share | (85,689 | ) | (85,689 | ) | ||||||||||||||||||||||||||||
Balance at June 30, 2022 | 38,976,859 | $ | 21,925 | $ | 1,032,291 | $ | (37,506 | ) | $ | 905,167 | $ | (87,440 | ) | $ | 385,338 | $ | 2,219,775 | |||||||||||||||
( In thousands, except share and per sharedata) | Common Stock, Class B Common Stock and Preferred Stock Shares | Common Stock, Class B Common Stock and Preferred Stock Amount | Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Non- Interest | Total | ||||||||||||||||||||||||
Balance at December 31, 2020 | 38,521,694 | $ | 21,697 | $ | 950,915 | $ | (34,867 | ) | $ | 636,373 | $ | (87,440 | ) | $ | 293,083 | $ | 1,779,761 | |||||||||||||||
Net income | 55,092 | 11,035 | 66,127 | |||||||||||||||||||||||||||||
Other comprehensive income | 2,474 | 1,302 | 3,776 | |||||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 121,934 | 61 | (61 | ) | — | |||||||||||||||||||||||||||
Forfeitures of non-vested restricted shares of common stock | (43,000 | ) | (21 | ) | 21 | — | ||||||||||||||||||||||||||
Common stock contribution to 401(k) plan | 22,752 | 11 | 5,143 | 5,154 | ||||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 24,735 | 12 | 3,862 | 3,874 | ||||||||||||||||||||||||||||
Share-based compensation | 6,656 | 6,656 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.775 per share | (68,521 | ) | (68,521 | ) | ||||||||||||||||||||||||||||
Balance at March 31, 2021 | 38,648,115 | 21,760 | 966,536 | (32,393 | ) | 622,944 | (87,440 | ) | 305,420 | 1,796,827 | ||||||||||||||||||||||
Net income | 144,102 | 28,031 | 172,133 | |||||||||||||||||||||||||||||
Other comprehensive income | 2,649 | 1,339 | 3,988 | |||||||||||||||||||||||||||||
Issuances of non-vested restricted shares of common stock | 44,881 | 22 | (22 | ) | — | |||||||||||||||||||||||||||
Forfeitures of non-vested restricted shares of common stock | (7,589 | ) | (4 | ) | 4 | — | ||||||||||||||||||||||||||
Stock issuances from exercise of stock options and employee stock purchase plan | 34,311 | 18 | 5,658 | 5,676 | ||||||||||||||||||||||||||||
Retirement of common stock | (2,965 | ) | (1 | ) | (862 | ) | (863 | ) | ||||||||||||||||||||||||
Share-based compensation | 5,569 | 5,569 | ||||||||||||||||||||||||||||||
Common stock issued for Acme Refrigeration of Baton Rouge LLC | 8,492 | 4 | 2,547 | 2,551 | ||||||||||||||||||||||||||||
Investment in TEC Distribution LLC | 21,040 | 21,040 | ||||||||||||||||||||||||||||||
Cash dividends declared and paid on Common and Class B common stock, $1.95 per share | (75,388 | ) | (75,388 | ) | ||||||||||||||||||||||||||||
Balance at June 30, 2021 | 38,725,245 | $ | 21,799 | $ | 979,430 | $ | (29,744 | ) | $ | 691,658 | $ | (87,440 | ) | $ | 355,830 | $ | 1,931,533 | |||||||||||||||
Six Months Ended June 30, | ||||||||
2022 | 2021 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 360,396 | $ | 238,260 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 15,376 | 13,877 | ||||||
Share-based compensation | 14,961 | 12,351 | ||||||
Provision for doubtful accounts | 4,139 | 465 | ||||||
Deferred income tax provision | 4,098 | 2,115 | ||||||
Other income from investment in unconsolidated entity | (10,362 | ) | (10,210 | ) | ||||
Other, net | 6,853 | 5,685 | ||||||
Changes in operating assets and liabilities, net of effects of acquisitions: | ||||||||
Accounts receivable, net | (289,478 | ) | (283,077 | ) | ||||
Inventories, net | (366,359 | ) | (173,539 | ) | ||||
Accounts payable and other liabilities | 332,217 | 282,852 | ||||||
Other, net | 1,231 | (6,897 | ) | |||||
Net cash provided by operating activities | 73,072 | 81,882 | ||||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (18,952 | ) | (11,008 | ) | ||||
Business acquisitions, net of cash acquired | (47 | ) | (126,549 | ) | ||||
Proceeds from sale of equity securities | — | 5,993 | ||||||
Proceeds from sale of property and equipment | 111 | 100 | ||||||
Net cash used in investing activities | (18,888 | ) | (131,464 | ) | ||||
Cash flows from financing activities: | ||||||||
Dividends on Common and Class B common stock | (161,484 | ) | (143,909 | ) | ||||
Repurchases of common stock to satisfy employee withholding tax obligations | (2,179 | ) | — | |||||
Net repayments of finance lease liabilities | (1,437 | ) | (966 | ) | ||||
Proceeds from non-controlling interest for investment in TEC Distribution LLC | — | 21,040 | ||||||
Net proceeds from issuances of common stock | 8,228 | 8,687 | ||||||
Net proceeds under revolving credit agreement | 114,600 | 114,167 | ||||||
Net cash used in financing activities | (42,272 | ) | (981 | ) | ||||
Effect of foreign exchange rate changes on cash and cash equivalents | (1,131 | ) | 1,283 | |||||
Net increase (decrease) in cash and cash equivalents | 10,781 | (49,280 | ) | |||||
Cash and cash equivalents at beginning of period | 118,268 | 146,067 | ||||||
Cash and cash equivalents at end of period | $ | 129,049 | $ | 96,787 | ||||
Supplemental cash flow information: | ||||||||
Common stock issued for Acme Refrigeration of Baton Rouge LLC | — | $ | 2,551 |
1. | BASIS OF PRESENTATION |
Quarter Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Primary Geographical Regions: | ||||||||||||||||
United States | $ | 1,615,319 | $ | 1,391,340 | $ | 4,291,838 | $ | 3,517,533 | ||||||||
Canada | 102,491 | 91,429 | 290,863 | 218,687 | ||||||||||||
Latin America and the Caribbean | 64,759 | 53,902 | 185,626 | 163,992 | ||||||||||||
$ | 1,782,569 | $ | 1,536,671 | $ | 4,768,327 | $ | 3,900,212 | |||||||||
Major Product Lines: | ||||||||||||||||
HVAC equipment | 69 | % | 70 | % | 69 | % | 70 | % | ||||||||
Other HVAC products | 27 | % | 27 | % | 27 | % | 27 | % | ||||||||
Commercial refrigeration products | 4 | % | 3 | % | 4 | % | 3 | % | ||||||||
100 | % | 100 | % | 100 | % | 100 | % | |||||||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Primary Geographical Regions: | ||||||||||||||||
United States | $ | 1,934,435 | $ | 1,665,253 | $ | 3,305,775 | $ | 2,676,519 | ||||||||
Canada | 113,159 | 113,880 | 202,582 | 188,372 | ||||||||||||
Latin America and the Caribbean | 86,161 | 70,507 | 148,968 | 120,867 | ||||||||||||
$ | 2,133,755 | $ | 1,849,640 | $ | 3,657,325 | $ | 2,985,758 | |||||||||
Major Product Lines: | ||||||||||||||||
HVAC equipment | 70 | % | 71 | % | 69 | % | 69 | % | ||||||||
Other HVAC products | 26 | % | 26 | % | 28 | % | 28 | % | ||||||||
Commercial refrigeration products | 4 | % | 3 | % | 3 | % | 3 | % | ||||||||
100 | % | 100 | % | 100 | % | 100 | % | |||||||||
3. | EARNINGS PER SHARE |
Quarter Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Basic Earnings per Share: | ||||||||||||||||
Net income attributable to Watsco, Inc. shareholders | $ | 140,865 | $ | 106,489 | $ | 340,059 | $ | 223,569 | ||||||||
Less: distributed and undistributed earnings allocated to non-vested restricted common stock | 12,590 | 9,146 | 30,182 | 19,178 | ||||||||||||
Earnings allocated to Watsco, Inc. shareholders | $ | 128,275 | $ | 97,343 | $ | 309,877 | $ | 204,391 | ||||||||
Weighted-average common shares outstanding - Basic | 35,260,126 | 35,099,871 | 35,222,865 | 35,046,156 | ||||||||||||
Basic earnings per share for Common and Class B common stock | $ | 3.64 | $ | 2.77 | $ | 8.80 | $ | 5.83 | ||||||||
Allocation of earnings for Basic: | ||||||||||||||||
Common stock | $ | 118,905 | $ | 90,197 | $ | 287,217 | $ | 189,364 | ||||||||
Class B common stock | 9,370 | 7,146 | 22,660 | 15,027 | ||||||||||||
$ | 128,275 | $ | 97,343 | $ | 309,877 | $ | 204,391 | |||||||||
Diluted Earnings per Share: | ||||||||||||||||
Net income attributable to Watsco, Inc. shareholders | $ | 140,865 | $ | 106,489 | $ | 340,059 | $ | 223,569 | ||||||||
Less: distributed and undistributed earnings allocated to non-vested restricted common stock | 12,563 | 9,135 | 30,132 | 19,175 | ||||||||||||
Earnings allocated to Watsco, Inc. shareholders | $ | 128,302 | $ | 97,354 | $ | 309,927 | $ | 204,394 | ||||||||
Weighted-average common shares outstanding - Basic | 35,260,126 | 35,099,871 | 35,222,865 | 35,046,156 | ||||||||||||
Effect of dilutive stock options | 181,852 | 137,151 | 177,389 | 62,887 | ||||||||||||
Weighted-average common shares outstanding - Diluted | 35,441,978 | 35,237,022 | 35,400,254 | 35,109,043 | ||||||||||||
Diluted earnings per share for Common and Class B common stock | $ | 3.62 | $ | 2.76 | $ | 8.75 | $ | 5.82 | ||||||||
Anti-dilutive stock options not included above | 63,959 | 3,750 | 27,513 | 27,755 |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Basic Earnings per Share: | ||||||||||||||||
Net income attributable to Watsco, Inc. shareholders | $ | 192,557 | $ | 144,102 | $ | 305,855 | $ | 199,194 | ||||||||
Less: distributed and undistributed earnings allocated to non-vested restricted common stock | 17,600 | 12,779 | 27,902 | 17,618 | ||||||||||||
Earnings allocated to Watsco, Inc. shareholders | $ | 174,957 | $ | 131,323 | $ | 277,953 | $ | 181,576 | ||||||||
Weighted-average common shares outstanding - Basic | 35,403,171 | 35,228,061 | 35,376,223 | 35,203,925 | ||||||||||||
Basic earnings per share for Common and Class B common stock | $ | 4.94 | $ | 3.73 | $ | 7.86 | $ | 5.16 | ||||||||
Allocation of earnings for Basic: | ||||||||||||||||
Common stock | $ | 162,229 | $ | 121,745 | $ | 257,716 | $ | 168,324 | ||||||||
Class B common stock | 12,728 | 9,578 | 20,237 | 13,252 | ||||||||||||
$ | 174,957 | $ | 131,323 | $ | 277,953 | $ | 181,576 | |||||||||
Diluted Earnings per Share: | ||||||||||||||||
Net income attributable to Watsco, Inc. shareholders | $ | 192,557 | $ | 144,102 | $ | 305,855 | $ | 199,194 | ||||||||
Less: distributed and undistributed earnings allocated to non-vested restricted common stock | 17,570 | 12,748 | 27,856 | 17,596 | ||||||||||||
Earnings allocated to Watsco, Inc. shareholders | $ | 174,987 | $ | 131,354 | $ | 277,999 | $ | 181,598 | ||||||||
Weighted-average common shares outstanding - Basic | 35,403,171 | 35,228,061 | 35,376,223 | 35,203,925 | ||||||||||||
Effect of dilutive stock options | 117,992 | 199,657 | 136,595 | 175,121 | ||||||||||||
Weighted-average common shares outstanding - Diluted | 35,521,163 | 35,427,718 | 35,512,818 | 35,379,046 | ||||||||||||
Diluted earnings per share for Common and Class B common stock | $ | 4.93 | $ | 3.71 | $ | 7.83 | $ | 5.13 | ||||||||
Anti-dilutive stock options not included above | 185,872 | 10,907 | 167,441 | 7,144 |
4. | OTHER COMPREHENSIVE (LOSS) INCOME |
Quarter Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Foreign currency translation adjustment | $ | (8,219 | ) | $ | 5,514 | $ | (746 | ) | $ | (6,592 | ) | |||||
Unrealized (loss) gain on cash flow hedging instruments | 0 | (570 | ) | 97 | 1,297 | |||||||||||
Income tax benefit (expense) | 0 | 154 | (27 | ) | (349 | ) | ||||||||||
Unrealized (loss) gain on cash flow hedging instruments, net of tax | 0 | (416 | ) | 70 | 948 | |||||||||||
Reclassification of (gain) loss on cash flow hedging instruments into earnings | 0 | (697 | ) | 305 | (946 | ) | ||||||||||
Income tax expense (benefit) | 0 | 188 | (84 | ) | 255 | |||||||||||
Reclassification of (gain) loss on cash flow hedging instruments into earnings, net of tax | 0 | (509 | ) | 221 | (691 | ) | ||||||||||
Other comprehensive (loss) income | $ | (8,219 | ) | $ | 4,589 | $ | (455 | ) | $ | (6,335 | ) | |||||
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Foreign currency translation adjustment | $ | (9,381 | ) | $ | 4,016 | $ | (5,000 | ) | $ | 7,473 | ||||||
Unrealized (loss) gain on cash flow hedging instruments | — | (6 | ) | — | 97 | |||||||||||
Income tax expense | — | — | — | (27 | ) | |||||||||||
Unrealized (loss) gain on cash flow hedging instruments, net of tax | — | (6 | ) | — | 70 | |||||||||||
Reclassification of (gain) loss on cash flow hedging instruments into earnings | — | (28 | ) | — | 305 | |||||||||||
Income tax expense (benefit) | — | 6 | — | (84 | ) | |||||||||||
Reclassification of (gain) loss on cash flow hedging instruments into earnings, net of tax | — | (22 | ) | — | 221 | |||||||||||
Other comprehensive (loss) income | $ | (9,381 | ) | $ | 3,988 | $ | (5,000 | ) | $ | 7,764 | ||||||
Nine Months Ended September 30, | 2021 | 2020 | ||||||
Foreign currency translation adjustment: | ||||||||
Beginning balance | $ | (34,694 | ) | $ | (38,599 | ) | ||
Current period other comprehensive loss | (406 | ) | (4,349 | ) | ||||
Ending balance | (35,100 | ) | (42,948 | ) | ||||
Cash flow hedging instruments: | ||||||||
Beginning balance | (173 | ) | (451 | ) | ||||
Current period other comprehensive income | 43 | 568 | ||||||
Reclassification adjustment | 132 | (414 | ) | |||||
Ending balance | 2 | (297 | ) | |||||
Accumulated other comprehensive loss, net of tax | $ | (35,098 | ) | $ | (43,245 | ) | ||
Six Months Ended June 30, | 2022 | 2021 | ||||||
Foreign currency translation adjustment: | ||||||||
Beginning balance | $ | (34,176 | ) | $ | (34,694 | ) | ||
Current period other comprehensive (loss) income | (3,330 | ) | 4,948 | |||||
Ending balance | (37,506 | ) | (29,746 | ) | ||||
Cash flow hedging instruments: | ||||||||
Beginning balance | — | (173 | ) | |||||
Current period other comprehensive income | — | 43 | ||||||
Reclassification adjustment | — | 132 | ||||||
Ending balance | — | 2 | ||||||
Accumulated other comprehensive loss, net of tax | $ | (37,506 | ) | $ | (29,744 | ) | ||
5. | ACQUISITIONS |
Accounts receivable | $ | 33,315 | ||
Inventories | 71,325 | |||
Other current assets | 962 | |||
Property and equipment | 2,590 | |||
Operating lease right-of-use assets | 53,829 | |||
Goodwill | 17,452 | |||
Intangibles | 19,900 | |||
Accounts payable | (25,393 | ) | ||
Accrued expenses and other current liabilities | (19,237 | ) | ||
Operating lease liabilities, net of current portion | (48,046 | ) | ||
Total | $ | 106,697 | ||
Accounts receivable | $ | 33,315 | ||
Inventories | 71,325 | |||
Other current assets | 962 | |||
Property and equipment | 2,590 | |||
Operating lease ROU assets | 53,829 | |||
Goodwill | 18,724 | |||
Intangibles | 19,900 | |||
Accounts payable | (25,393 | ) | ||
Accrued expenses and other current liabilities | (20,509 | ) | ||
Operating lease liabilities, net of current portion | (48,046 | ) | ||
Total | $ | 106,697 | ||
6. | DERIVATIVES |
Quarter Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(Loss) gain recorded in accumulated other comprehensive loss | $ | 0 | $ | (570 | ) | $ | 97 | $ | 1,297 | |||||||
(Gain) loss reclassified from accumulated other comprehensive loss into earnings | $ | 0 | $ | (697 | ) | $ | 305 | $ | (946 | ) |
Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
(Loss) gain recorded in accumulated other comprehensive loss | — | $ | (6 | ) | — | $ | 97 | |||||||||
(Gain) loss reclassified from accumulated other comprehensive loss into earnings | — | $ | (28 | ) | — | $ | 305 |
Asset Derivatives | Liability Derivatives | |||||||||||||||
June 30, 2022 | December 31, 2021 | June 30, 2022 | December 31, 2021 | |||||||||||||
Derivatives designated as hedging instruments | $ | — | $ | — | $ | — | $ | — | ||||||||
Derivatives not designated as hedging instruments | 12 | — | — | 5 | ||||||||||||
Total derivative instruments | $ | 12 | $ | — | $ | — | $ | 5 | ||||||||
Asset Derivatives | Liability Derivatives | |||||||||||||||
September 30, 2021 | December 31, 2020 | September 30, 2021 | December 31, 2020 | |||||||||||||
Derivatives designated as hedging instruments | $ | 0 | $ | 0 | $ | 0 | $ | 91 | ||||||||
Derivatives not designated as hedging instruments | 0 | 0 | 5 | 10 | ||||||||||||
Total derivative instruments | $ | 0 | $ | 0 | $ | 5 | $ | 101 | ||||||||
7. | FAIR VALUE MEASUREMENTS |
Fair Value Measurements at June 30, 2022 Using | ||||||||||||||||||
Balance Sheet Location | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||
Assets: | ||||||||||||||||||
Derivative financial instruments | Other current assets | $ | 12 | — | $ | 12 | — | |||||||||||
Equity securities | Other assets | $ | 650 | $ | 650 | — | — | |||||||||||
Private equities | Other assets | $ | 1,000 | — | — | $ | 1,000 |
Fair Value Measurements at September 30, 2021 Using | ||||||||||||||||||
Balance Sheet Location | Total | Level 1 | Level 2 | Level 3 | ||||||||||||||
Assets: | ||||||||||||||||||
Equity securities | Other assets | $ | 1,750 | $ | 1,750 | $ | — | $ | — | |||||||||
Liabilities: | ||||||||||||||||||
Derivative financial instruments | Accrued expenses and other current liabilities | $ | 5 | $ | — | $ | 5 | $ | — |
Fair Value Measurements at December 31, 2020 Using | Total | Fair Value Measurements at December 31, 2021 Using | ||||||||||||||||||||||||||||||||||
Balance Sheet Location | Total | Level 1 | Level 2 | Level 3 | Balance Sheet Location | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||
Equity securities | Other assets | $ | 6,065 | $ | 6,065 | $ | — | $ | — | Other assets | $ | 1,790 | $ | 1,790 | — | — | ||||||||||||||||||||
Private equities | Other assets | $ | 1,000 | — | — | $ | 1,000 | |||||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||||||
Derivative financial instruments | Accrued expenses and other current liabilities | $ | 101 | $ | — | $ | 101 | $ | — | Accrued expenses and other current liabilities | $ | 5 | — | $ | 5 | — |
8. |
9. |
10. | RELATED PARTY TRANSACTIONS |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Quarter Ended September 30, | Nine Months Ended September 30, | Quarter Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||
Revenues | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||||
Cost of sales | 72.9 | 75.7 | 73.7 | 75.9 | 72.1 | 74.2 | 71.4 | 74.1 | ||||||||||||||||||||||||
Gross profit | 27.1 | 24.3 | 26.3 | 24.1 | 27.9 | 25.8 | 28.6 | 25.9 | ||||||||||||||||||||||||
Selling, general and administrative expenses | 15.8 | 14.4 | 16.1 | 15.9 | 14.8 | 14.4 | 16.4 | 16.2 | ||||||||||||||||||||||||
Other income | 0.3 | 0.3 | 0.3 | 0.2 | 0.3 | 0.3 | 0.3 | 0.3 | ||||||||||||||||||||||||
Operating income | 11.6 | 10.2 | 10.6 | 8.5 | 13.5 | 11.7 | 12.5 | 10.0 | ||||||||||||||||||||||||
Interest expense, net | 0.0 | 0.0 | 0.0 | 0.0 | 0.1 | 0.0 | 0.0 | 0.0 | ||||||||||||||||||||||||
Income before income taxes | 11.6 | 10.2 | 10.6 | 8.5 | 13.4 | 11.7 | 12.5 | 10.0 | ||||||||||||||||||||||||
Income taxes | 2.3 | 2.0 | 2.1 | 1.6 | 2.8 | 2.4 | 2.6 | 2.0 | ||||||||||||||||||||||||
Net income | 9.2 | 8.2 | 8.5 | 6.8 | 10.6 | 9.3 | 9.9 | 8.0 | ||||||||||||||||||||||||
Less: net income attributable to non-controlling interest | 1.3 | 1.3 | 1.3 | 1.1 | 1.5 | 1.5 | 1.5 | 1.3 | ||||||||||||||||||||||||
Net income attributable to Watsco, Inc. | 7.9 | % | 6.9 | % | 7.1 | % | 5.7 | % | 9.0 | % | 7.8 | % | 8.4 | % | 6.7 | % | ||||||||||||||||
Number of Locations | ||||
Opened | 16 | |||
Acquired | 6 | |||
Closed | ( | ) | ||
December 31, | ||||
Opened | ||||
Closed | ( | ) | ||
673 | ||||
2021 | 2020 | Change | 2022 | 2021 | Change | |||||||||||||||||||
Cash flows provided by operating activities | $ | 319.7 | $ | 372.8 | $ | (53.1 | ) | $ | 73.1 | $ | 81.9 | $ | (8.8 | ) | ||||||||||
Cash flows used in investing activities | $ | (140.1 | ) | $ | (11.5 | ) | $ | (128.6 | ) | $ | (18.9 | ) | $ | (131.5 | ) | $ | 112.6 | |||||||
Cash flows used in financing activities | $ | (187.9 | ) | $ | (342.8 | ) | $ | 154.9 | $ | (42.3 | ) | $ | (1.0 | ) | $ | (41.3 | ) |
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 4. CONTROLS AND PROCEDURES |
ITEM 1. LEGAL PROCEEDINGS |
ITEM 1A. RISK FACTORS |
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
23 of 25 | ITEM 6. EXHIBITS |
# | filed herewith. |
+ | furnished herewith. |
WATSCO, INC. | ||||||
(Registrant) | ||||||
Date: | By: | /s/ Ana M. Menendez | ||||
Ana M. Menendez | ||||||
Chief Financial Officer (on behalf of the Registrant and as Principal Financial Officer) |