Business Wire | Jul 19, 2021 04:10PM EDT

AMCON Distributing Company Reports Results for the Quarter Ended June 30, 2021

Jul. 19, 2021

OMAHA, Neb.--(BUSINESS WIRE)--Jul. 19, 2021--AMCON Distributing Company ("AMCON") (NYSE American: DIT), an Omaha, Nebraska based consumer products company, is pleased to announce fully diluted earnings per share of $6.48 on net income available to common shareholders of $3.7 million for its third fiscal quarter ended June 30, 2021.

"We are pleased with our results for the third fiscal quarter. Our Management Team and Associates' central focus is on delivering a consistent level of high quality service to our customers in this challenging economic environment," said Christopher H. Atayan, AMCON's Chairman and Chief Executive Officer. Mr. Atayan further noted, "AMCON continues to seek out acquisition opportunities for Convenience and Food Service Distributors who want to align with our growing platform and customer centric management philosophy."

The wholesale distribution segment reported revenues of $426.6 million and operating income of $6.3 million for the third quarter of fiscal 2021. The retail health food segment reported revenues of $11.7 million and operating income of $0.6 million for the third quarter of fiscal 2021.

"Ongoing supply chain disruptions at consumer packaged goods companies have impacted product availability across all markets including the convenience distribution industry in which our Company operates. Additionally, the United States is experiencing an acute workforce shortage which has created a hyper-competitive wage environment which has impacted the Company's operations. Our customer base continues to grow geographically and AMCON is deploying the capital and human resources necessary to support our customers' growth in a collaborative fashion," said Andrew C. Plummer, AMCON's President and Chief Operating Officer. Mr. Plummer further noted, "We are actively searching for facilities in, and adjacent to, the geographic markets we serve."

Charles J. Schmaderer, AMCON's Chief Financial Officer said, "AMCON is pleased with the progress of our strategic investment in Team Sledd, LLC. In addition, AMCON ended the quarter with $71.4 million of shareholders' equity and we continue to diligently focus on maintaining high levels of liquidity in our business to support operations and our growth initiatives."

AMCON's Healthy Edge Retail Group plays an important role in the health and wellness of the communities it serves. Throughout the pandemic, our management team has worked diligently to offer a continuous and safe shopping experience for customers. Our long term relationship with the organic/natural products vendor community has enabled our stores to meet the demands of our customers for total wellness solutions. Our strategy is to offer a broad selection of the highest quality organic and natural merchandise available supported by a high degree of customer service not found at other big box retailers within our industry.

AMCON is a leading wholesale distributor of consumer products, including beverages, candy, tobacco, groceries, foodservice, frozen and chilled foods, and health and beauty care products with locations in Illinois, Missouri, Nebraska, North Dakota, South Dakota and Tennessee. AMCON also operates twenty (20) health and natural product retail stores in the Midwest and Florida. The retail stores operate under the names Akin's Natural Foods www.akins.com in its Midwest market, and Chamberlin's Natural Foods www.chamberlins.com and Earth Origins Market www.earthoriginsmarket.com in its Florida market.

This news release contains forward-looking statements that are subject to risks and uncertainties and which reflect management's current beliefs and estimates of future economic circumstances, industry conditions, Company performance and financial results. A number of factors could affect the future results of the Company and could cause those results to differ materially from those expressed in the Company's forward-looking statements including, without limitation, availability of sufficient cash resources to conduct its business and meet its capital expenditures needs and the other factors described under Item 1.A. of the Company's Annual Report on Form 10-K. Moreover, past financial performance should not be considered a reliable indicator of future performance. Accordingly, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all such forward-looking statements.

Visit AMCON Distributing Company's web site at: www.amcon.com

AMCON Distributing Company and Subsidiaries

Condensed Consolidated Balance Sheets

June 30, 2021 and September 30, 2020



June September

2021 2020

(Unaudited)

ASSETS

Current assets:

Cash $ 699,895 $ 661,195

Accounts receivable, less allowance fordoubtful accounts of $0.9 million at June 36,526,770 34,278,429 2021 and September 2020

Inventories, net 95,640,441 98,971,773

Prepaid and other current assets 5,769,066 2,091,645

Total current assets 138,636,172 136,003,042



Property and equipment, net 16,425,171 17,497,274

Operating lease right-of-use assets, net 17,148,745 18,936,126

Note receivable 3,500,000 3,500,000

Goodwill 4,436,950 4,436,950

Other intangible assets, net 500,000 500,000

Equity method investment 7,784,753 6,744,095

Other assets 349,139 383,786

Total assets $ 188,780,930 $ 188,001,273



LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable $ 24,788,839 $ 22,108,299

Accrued expenses 11,169,530 8,306,160

Accrued wages, salaries and bonuses 3,839,072 4,761,020

Income taxes payable 495,860 567,408

Current operating lease liabilities 5,503,940 5,607,098

Current maturities of long-term debt 555,832 516,850

Total current liabilities 46,353,073 41,866,835



Credit facility 51,491,984 61,971,682

Deferred income tax liability, net 1,585,882 1,806,575

Long-term operating lease liabilities 12,000,823 14,028,606

Long-term debt, less current maturities 5,196,596 2,608,794

Other long-term liabilities 757,387 927,241



Shareholders' equity:

Preferred stock, $.01 par value, 1,000,000 - - shares authorized

Common stock, $.01 par value, 3,000,000shares authorized, 551,369 shares 8,834 8,697 outstanding at June 2021 and 537,715 sharesoutstanding at September 2020

Additional paid-in capital 24,943,292 24,282,058

Retained earnings 77,310,346 71,362,334

Treasury stock at cost (30,867,287 ) (30,861,549 )

Total shareholders' equity 71,395,185 64,791,540

Total liabilities and shareholders' equity $ 188,780,930 $ 188,001,273

AMCON Distributing Company and Subsidiaries

Condensed Consolidated Unaudited Statements of Operations

for the three and nine months ended June 30, 2021 and 2020



For the three months ended June For the nine months ended June

2021 2020 2021 2020

Sales(includingexcise taxesof $104.9million and$103.6 $ 438,313,030 $ 396,854,324 $ 1,221,571,294 $ 1,094,841,943 million, and$297.4 millionand $285.1million,respectively)

Cost of sales 412,771,324 375,202,044 1,149,594,823 1,031,651,499

Gross profit 25,541,706 21,652,280 71,976,471 63,190,444

Selling,general and 20,501,117 18,377,641 58,123,100 55,843,266 administrativeexpenses

Depreciation 741,180 801,683 2,295,390 2,318,045

21,242,297 19,179,324 60,418,490 58,161,311

Operating 4,299,409 2,472,956 11,557,981 5,029,133 income



Other expense (income):

Interest 329,929 461,581 1,016,902 1,321,267 expense

Other (43,437 ) (42,525 ) (169,525 ) (79,222 )(income), net

286,492 419,056 847,377 1,242,045

Income fromoperations 4,012,917 2,053,900 10,710,604 3,787,088 before incometaxes

Income tax 1,076,000 586,000 2,916,000 1,168,000 expense

Equity methodinvestment 754,293 111,666 1,403,124 111,666 earnings, netof tax

Net incomeavailable to $ 3,691,210 $ 1,579,566 $ 9,197,728 $ 2,730,754 commonshareholders



Basic earningsper shareavailable to $ 6.69 $ 2.79 $ 16.71 $ 4.84 commonshareholders

Dilutedearnings pershare $ 6.48 $ 2.77 $ 16.37 $ 4.79 available tocommonshareholders



Basic weightedaverage shares 551,369 565,483 550,276 564,578 outstanding

Dilutedweighted 569,481 569,902 561,940 569,873 average sharesoutstanding



Dividendsdeclared and $ 0.18 $ 0.18 $ 5.54 $ 0.82 paid percommon share

AMCON Distributing Company and Subsidiaries

Condensed Consolidated Unaudited Statements of Shareholders' Equity

for the three and nine months ended June 30, 2021 and 2020



Additional

Common Stock Treasury Stock Paid-in Retained

Shares Amount Shares Amount Capital Earnings Total

THREE MONTHSENDED JUNE 2020

Balance,April 1, 869,367 $ 8,692 (303,841 ) $ (28,863,654 ) $ 24,224,145 $ 67,184,900 $ 62,554,083 2020

Dividends oncommon - - - - - (107,091 ) (107,091 )stock, $0.18per share

Compensationexpense andissuance ofstock in 500 5 - - 26,728 - 26,733 connectionwithequity-basedawards

Repurchaseof common - - (1,148 ) (68,725 ) - - (68,725 )stock

Net income - - - - - 1,579,566 1,579,566

Balance,June 30, 869,867 $ 8,697 (304,989 ) $ (28,932,379 ) $ 24,250,873 $ 68,657,375 $ 63,984,566 2020



THREE MONTHSENDED JUNE 2021

Balance,April 1, 883,589 $ 8,834 (332,220 ) $ (30,867,287 ) $ 24,917,765 $ 73,724,722 $ 67,784,034 2021

Dividends oncommon - - - - - (105,586 ) (105,586 )stock, $0.18per share

Compensationexpense andissuance ofstock in - - - - 25,527 - 25,527 connectionwithequity-basedawards

Repurchaseof common - - - - - - - stock

Net income - - - - - 3,691,210 3,691,210

Balance,June 30, 883,589 $ 8,834 (332,220 ) $ (30,867,287 ) $ 24,943,292 $ 77,310,346 $ 71,395,185 2021

Additional

Common Stock

Treasury Stock

Paid-in

Retained

Shares

Amount

Shares

Amount

Capital

Earnings

Total

NINE MONTHS ENDED JUNE 2020

Balance, October 1, 2019

856,039

$

8,561

(303,425

)

$

(28,831,855

)

$

23,165,639

$

66,414,397

$

60,756,742

Dividends on common stock, $0.82 per share

-

-

-

-

-

(487,776

)

(487,776

)

Compensation expense and issuance of stock in connection with equity-based awards

13,828

136

-

-

1,085,234

-

1,085,370

Repurchase of common stock

-

-

(1,564

)

(100,524

)

-

-

(100,524

)

Net income

-

-

-

-

-

2,730,754

2,730,754

Balance, June 30, 2020

869,867

$

8,697

(304,989

)

$

(28,932,379

)

$

24,250,873

$

68,657,375

$

63,984,566

NINE MONTHS ENDED JUNE 2021

Balance, October 1, 2020

869,867

$

8,697

(332,152

)

$

(30,861,549

)

$

24,282,058

$

71,362,334

$

64,791,540

Dividends on common stock, $5.54 per share

-

-

-

-

-

(3,249,716

)

(3,249,716

)

Compensation expense and issuance of stock in connection with equity-based awards

13,722

137

-

-

661,234

-

661,371

Repurchase of common stock

-

-

(68

)

(5,738

)

-

-

(5,738

)

Net income

-

-

-

-

-

9,197,728

9,197,728

Balance, June 30, 2021

883,589

$

8,834

(332,220

)

$

(30,867,287

)

$

24,943,292

$

77,310,346

$

71,395,185

Additional

Common Stock Treasury Stock Paid-in Retained

Shares Amount Shares Amount Capital Earnings Total

NINE MONTHSENDED JUNE 2020

Balance,October 1, 856,039 $ 8,561 (303,425 ) $ (28,831,855 ) $ 23,165,639 $ 66,414,397 $ 60,756,742 2019

Dividends oncommon - - - - - (487,776 ) (487,776 )stock, $0.82per share

Compensationexpense andissuance ofstock in 13,828 136 - - 1,085,234 - 1,085,370 connectionwithequity-basedawards

Repurchaseof common - - (1,564 ) (100,524 ) - - (100,524 )stock

Net income - - - - - 2,730,754 2,730,754

Balance,June 30, 869,867 $ 8,697 (304,989 ) $ (28,932,379 ) $ 24,250,873 $ 68,657,375 $ 63,984,566 2020



NINE MONTHSENDED JUNE 2021

Balance,October 1, 869,867 $ 8,697 (332,152 ) $ (30,861,549 ) $ 24,282,058 $ 71,362,334 $ 64,791,540 2020

Dividends oncommon - - - - - (3,249,716 ) (3,249,716 )stock, $5.54per share

Compensationexpense andissuance ofstock in 13,722 137 - - 661,234 - 661,371 connectionwithequity-basedawards

Repurchaseof common - - (68 ) (5,738 ) - - (5,738 )stock

Net income - - - - - 9,197,728 9,197,728

Balance,June 30, 883,589 $ 8,834 (332,220 ) $ (30,867,287 ) $ 24,943,292 $ 77,310,346 $ 71,395,185 2021

AMCON Distributing Company and Subsidiaries

Condensed Consolidated Unaudited Statements of Cash Flows

for the nine months ended June 30, 2021 and 2020



June June

2021 2020

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income $ 9,197,728 $ 2,730,754

Adjustments to reconcile net incomefrom operations to net cash flows from (used in)operating activities:

Depreciation 2,295,390 2,318,045

Equity method investment earnings, (1,403,124 ) (111,666 )net of tax

(Gain) loss on sales of property and (8,057 ) 17,042 equipment

Equity-based compensation 1,819,272 765,704

Deferred income taxes (220,693 ) (2,862 )

Provision for losses on doubtful 86,000 349,000 accounts

Inventory allowance 238,148 182,218

Changes in assets and liabilities:

Accounts receivable (2,334,341 ) (9,309,422 )

Inventories 3,093,184 20,152,080

Prepaid and other current assets (3,677,421 ) (373,414 )

Equity method investment 828,466 - distributions

Other assets 34,647 (126,364 )

Accounts payable 2,680,540 2,040,386

Accrued expenses and accrued wages, 804,983 (1,424,472 )salaries and bonuses

Other long-term liabilities (169,854 ) 125,744

Income taxes payable and receivable (537,548 ) 794,027

Net cash flows from (used in) 12,727,320 18,126,800 operating activities



CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property and equipment (1,254,958 ) (2,901,134 )

Proceeds from sales of property and 39,728 16,600 equipment

Investment in equity method investee - (6,500,000 )

Issuance of note receivable - (3,500,000 )

Net cash flows from (used in) (1,215,230 ) (12,884,534 )investing activities



CASH FLOWS FROM FINANCING ACTIVITIES:

Borrowings under revolving credit 1,217,375,073 1,083,878,207 facility

Repayments under revolving credit (1,227,854,771 ) (1,087,870,919 )facility

Proceeds from borrowings on long-term 3,000,000 - debt

Principal payments on long-term debt (373,216 ) (397,936 )

Proceeds from exercise of stock - 25,750 options

Repurchase of common stock (5,738 ) (100,524 )

Dividends on common stock (3,249,716 ) (487,776 )

Settlement and withholdings of (365,022 ) (30,208 )equity-based awards

Net cash flows from (used in) (11,473,390 ) (4,983,406 )financing activities

Net change in cash 38,700 258,860

Cash, beginning of period 661,195 337,704

Cash, end of period $ 699,895 $ 596,564



Supplemental disclosure of cash flow information:

Cash paid during the period for $ 1,031,457 $ 1,387,381 interest

Cash paid during the period for 3,667,036 376,835 income taxes



Supplemental disclosure of non-cash information:

Equipment acquisitions classified in $ - $ 100,424 accounts payable

Issuance of common stock inconnection with the vesting and 949,812 990,653 exercise of equity-based awards

View source version on businesswire.com: https://www.businesswire.com/news/home/20210719005750/en/

CONTACT: Christopher H. Atayan AMCON Distributing Company Ph 402-331-3727