XPEL, Inc. (XPEL) research, news, and more from GeoInvesting

Company description

Wed, 10 May 2023 13:09:32 GMT

XPEL is a leading provider of protective films and coatings, including automotive paint protection film, surface protection film, automotive and commercial/residential window films, and ceramic coatings. With a global footprint, a network of trained installers and proprietary DAP software, XPEL is dedicated to exceeding customer expectations by providing high-quality products, leading customer service, expert technical support and world-class training. XPEL, Inc. is publicly traded on Nasdaq under the symbol 'XPEL'.

Research

Tue, 29 Aug 2017 15:04:35 GMT

DAP-U.V ($1.50), $XPLT ($1.56) and successful “Run to One” play, reported Q2 2017 results:

Sales of $17.0 million vs $13.6 million in the prior year
EPS of $0.03 vs $0.03

Quotes from management:

“Our second quarter revenue was the highest revenue quarter by far in the Company’s history as we continued to execute on our core ‘Get Close to the Customer’ strategy. Customer demand was strong throughout our markets, particularly in Canada, and we saw strong growth across all of our product lines.

Gross margins for the quarter remained relatively steady versus the prior year and we continue to invest in infrastructure, sales, marketing and product development to drive growth and scale the business.

Our strategy positions us well to effectively leverage our distribution channels and our brand to drive solid top and bottom line growth.”

Now that some legal issues with $MMM are behind the company, management can focus on running the business. We are eager to see if the company can manage to grow its bottom line.

Research

Tue, 28 Mar 2017 16:17:41 GMT

XPLT ($2.40) - Shares of Ex-GeoBargain XPLT have been strong the past week rising from $1.40 to $2.40. On March 23, 2017 the company announced the settlement of patent infringement lawsuit with 3M. Yesterday after the close, XPLT announced fourth quarter and annual revenue growth of 19% and 25% respectively.

“In a recent and important development, we were very pleased to announce last week that we have reached a settlement with 3M Company in our patent infringement lawsuit. We are excited to have this matter resolved so that we may return our full focus and resources to delivering the highest quality products and services to our customers.

We continue to see strong demand and growth across our product lines, and we are making measurable progress with our initiatives to control our delivery model, leverage our distribution channels and expand our worldwide brand exposure. As we move through 2017, we believe we are well positioned to grow our market share and customer base while delivering value for our shareholders.”

Research

Tue, 01 Sep 2015 14:44:39 GMT

Closed our long position in XPLT ($2.69)

After a nice ride with XPLT, we have decided to close out our long position in XPLT due to Q2 2015 conference call commentary not included in the associated press release.

We first disclosed our long position in XPLT on 1/18/13 when the stock was trading at $0.29. The stock became a multi-bagger for our portfolio. It was our belief that the stock’s strength could continue when we coded it a GeoBargain on 10/3/14 at $3.00. Shares hit a recent high of $3.99 on 8/17/2015 before retracing to current levels. Yesterday, XPLT reported Q2 2015 results:

Sales of $11.3 million vs $8.3 million in the prior year period
EPS of $0.02 vs $0.02 in the prior year

While sales growth remained strong for the quarter (largely aided by a recent acquisition), concerns from the conference call indicate that the company is facing headwinds for the first time since we went long. After listening to the conference call, it seems that several factors will continue to negatively affect growth going forward:

The impact of foreign currency weakening vs the U.S dollar is negatively impacting net income.
Reorganization of distribution network China reduced growth
A weakened Canadian economy is expected to add pressure on Canadian sales.

We will continue to actively track XPLT to determine if and when to reestablish a long position.

Comments & Business Outlook

Mon, 31 Aug 2015 15:09:47 GMT

XPLT ($3.60) announced Q2 2015 results:

Sales of $11.3 million vs $8.3 million in the prior year period
EPS of $0.02 vs $0.02 in the prior year

Quotes from management:

“We have seen continued momentum in the second quarter with solid growth and the completion of the integration of Parasol Canada, which we acquired in the first quarter.

In addition to good growth in the U.S., our direct presence in Canada and Europe generated strong revenue growth in both regions, despite pressure from the U.S. Dollar. Elsewhere, the impact of foreign currency on our distributors and the reorganization of our distribution in China reduced growth in the quarter. Across our international subsidiaries, net income would have increased over $300,000 if the relevant exchange rates were at their prior year rates.

The continued expansion of our U.S. sales and marketing programs combined with the distribution changes in Canada and China position us well to continue our differentiated, premium offering as the business grows and we introduce additional products and services.”

Research

Thu, 16 Jul 2015 13:37:50 GMT

Will look to add to our GeoBargain XPLT Position

We will look to add to our long position in XPLT ($3.30) prior to the company reporting its Q2 2015 results in late August or Early September. We believe an information arbitrage opportunity exists due to:

Bullish comments in the company’s 2015 Q1 earnings conference call held on June 2, 2015 that were not present in its associated press release.
A clear change in sentiment included in its Q1 2015 vs Q4 2014 earnings call.

We added XPLT to our 52 week high screener and disclosed our long position on 1/18/2013 when shares were trading at $0.29. We stated that the aftermarket automotive parts industry had been a favorable industry and that we would roll the dice with this company since it had shown consistent revenue growth for the past 9 quarters. We then coded XPLT as a GeoBargain on 10/3/2014 at $3.00. The company has continued its trend of strong quarterly sales growth that originally attracted us to the story.

While reading through the last two conference call transcripts, we noticed a key change in tone from the CEO:

Q4 2014 conference call transcript:

“Now it’s important to note that as the numbers get bigger, the revenue growth percentage we’ve seen you know will moderate somewhat, a non-aggressive reduction from the great growth we’ve seen this year. But it's probably unrealistic to consistently deliver growth in excess of 50% as we become larger. With that said, you know we’re still focused on growth, and we’re driving strong, and we complete at very strong momentum in the business.”

Q1 2015 conference call transcript:

“Overall we think that at the signs at where we are if we can drive revenue growth year-over-year in excess of 50% we think that's a great growth rate and so we're very pleased with that number...

...we know those are big comps and 50% growth on second quarter of last year is a big number but that’s what we’re gearing for and if we can maintain at that 50% number we’re going to be very excited about that and in excess of that is just a bonus.”

It seems the company was not comfortable maintaining a 50% growth rate heading into Q1, but subsequently on the Q1 conference call, management seemed comfortable once again with expectations of at least 50% growth heading into Q2 and beyond.

We are currently performing a valuation analysis on shares.

Comments & Business Outlook

Mon, 01 Jun 2015 04:00:00 GMT

First Quarter 2015 Results

Revenue in the first quarter of fiscal 2015 was $8.1 million, a 54% increase as compared to revenue of $5.3 million in the same prior year quarter and a 7% increase sequentially as compared to the fourth quarter of 2014.
Net income for the fiscal 2015 first quarter was $672,208 or $0.03 per basic and diluted share based on 25,784,950 shares outstanding, compared with net income of $459,285, or $0.02 per basic and diluted share based on 25,784,950 shares outstanding, for the corresponding prior year period.

Quotes from management:

“Our international expansion strategy is proceeding well and, as previously announced, during the first quarter we acquired Parasol Canada, a distributor of paint protection and window tint products for the Canadian market. In addition to expanding our portfolio of products, Parasol brings a dedicated Canadian sales force which we are leveraging to bring our successful U.S. marketing initiatives to this important market. Additionally, our U.K. facility, established to address market demand in Europe and additional regions, is performing well, fulfilling customer needs and offering regularly scheduled training courses. Our sales efforts in the region are gaining traction, resulting in a solid pipeline of new customers throughout Europe.”

Comments & Business Outlook

Tue, 31 Mar 2015 04:00:00 GMT

$XPLT ($3.40) - GeoBargain XPLT reported Q4 2014 results:

Revenues for Q4 2014 were $7.6 million vs $5.0 million in the prior year period.
Non-GAAP EPS for Q4 2014 was $0.01 vs $0.01 in the prior year

Mr. Ryan Pape, President and Chief Executive Officer of XPEL, commented, “2014 was a strong year for our Company, marked by significant revenue growth, international expansion, and the continued strategic development of our distribution channels. We are seeing growing market demand for and recognition of the XPEL brand, both domestically and internationally and are executing on our strategy to ensure that our products and services are available to meet the demands of existing and potential customers worldwide.”

Mr. Pape continued, “International expansion and moving closer to our international customers has been a key focus of ours in the back half of 2014 and into 2015. Our new XPEL U.K. facility established a strategic beachhead to service Europe and regions beyond. The facility provides readily available inventory to efficiently fulfill customer orders and in February we began offering regular onsite training courses. We are ramping our sales efforts targeting potential European customers and building a pipeline through both existing and new relationships. Subsequent to the close of the fourth quarter, we announced our acquisition of Parasol Canada, a distributor of paint protection and window tint products for the Canadian market. This acquisition adds to our portfolio of products, provides a dedicated Canadian sales force and allows us to bring our proven U.S. marketing initiatives to this key international market.”

Acquisition Activity

Fri, 06 Feb 2015 05:00:00 GMT

SAN ANTONIO--(BUSINESS WIRE)--XPEL Technologies Corp. (TSXV:DAP.U), a global supplier of automotive paint and headlamp protection films, today announced that it has acquired Parasol Canada, a distributor of paint protection and window tint products for the Canadian market.

Parasol, founded in 2009, is headquartered in Terrebonne, a suburb of Montreal, with a distribution office in Calgary. Parasol has hundreds of independent installers and automobile dealerships as customers who are serviced by sales representatives in key markets throughout Canada. In addition to supplying customers with paint protection film, automotive window tint and installation tools, Parasol also provides extensive installation training.

Mr. Ryan Pape, President and Chief Executive Officer of XPEL, said, �This acquisition is in line with our strategy to get closer to our end customers, particularly in key international markets. Parasol Canada is a profitable business with a successful management team who will remain with the company. The acquisition allows us to gain a dedicated Canadian sales force, add to our portfolio of products, gain margin and expand our proven U.S. marketing initiatives into Canada, where we believe there is significant opportunity for growth as we integrate under the XPEL brand. Furthermore, Parasol Canada brings with it a five-year agreement and five-year renewal option to exclusively supply paint protection film and window tint to the 79 locations that comprise the Protex Paint Protection and Pelti Window Film franchise groups.�

A majority of Parasol Canada�s revenue is derived from the sale of XPEL products.

The acquisition price of CAD$4.8 million was funded by US$1.9M in new borrowing from the Company�s primary lender, The Bank of San Antonio and a five-year, interest-free seller�s note. XPEL acquired inventory and receivables of approximately CAD$1.5 million as part of the purchase price.

The acquisition of Parasol Canada was completed by the transfer of all of Parasol Canada�s assets to a new subsidiary and the acquisition of all of the shares of the new subsidiary by XPEL Canada Corp., XPEL�s wholly owned Canadian subsidiary.

Mr. Pape continued, �We are focused on expanding our geographical reach and increasing our customer base to drive revenue growth. Canada is our largest international market, and this acquisition enhances our presence there as we look to continue to grow market share.

GeoBargain Notes

Fri, 06 Feb 2015 05:00:00 GMT

Geobargain XPLT ($2.80) - XPLT manufactures, distributes, and sells after-market automotive products primarily in the United States. The company announced that the company acquired Parasol Canada, a distributor of paint protection and window tint products for the Canadian market. The total acquisition price is CAD$4.8 million which was partially funded by US$1.9M in new borrowing. XPEL acquired inventory and receivables of approximately CAD$1.5 million as part of the purchase price. A majority of Parasol Canada’s revenue is derived from the sale of XPEL products. Commentary from management:

“This acquisition is in line with our strategy to get closer to our end customers, particularly in key international markets. Parasol Canada is a profitable business with a successful management team who will remain with the company. The acquisition allows us to gain a dedicated Canadian sales force, add to our portfolio of products, gain margin and expand our proven U.S. marketing initiatives into Canada, where we believe there is significant opportunity for growth as we integrate under the XPEL brand.”

Benefits of this transaction:

The margin of XPEL should see an immediate increase because Parasol Canada was selling (marking up) XPEL products to its end customers.
Parasol's 5 year supply agreement to exclusively supply paint protection film and window tint to the 79 locations that comprise the Protex Paint Protection and Pelti Window Film franchise groups will XPEL access to greater sales channels.

Comments & Business Outlook

Tue, 25 Nov 2014 05:00:00 GMT

Third Quarter 2014 Results

Revenue in the third quarter of fiscal 2014 was $8.4 million, a 72% increase as compared to revenue of $4.9 million in the same prior year quarter and a slight sequential increase compared to revenue of $8.3 million in the second quarter of 2014.
Net income for the fiscal 2014 third quarter was $473,296 or $0.018 per basic and diluted share based on 25,784,950 shares outstanding, compared with net income of $392,895, or $0.015 per basic and diluted share based on 25,784,950 shares outstanding, for the corresponding prior year period.

Mr. Pape continued, “Just prior to the close of the third quarter, we completed our acquisition to establish our new XPEL U.K. facility, providing a foothold to move XPEL closer to customers and partners in the region. The facility includes a training and support center and provides readily available inventory to potential and existing European customers. The acquisition is going well and the new facility was operating profitably after the first month. As expected, during the third quarter we had modest one-time acquisition related expenses and also incurred other one-time expenses that impacted net profitability for the quarter.”

“Our balance sheet remains strong, providing us with the financial flexibility to strengthen our employee base and drive our sales and marketing strategy. Inventory is up substantially over the second quarter. This is partially due to our need for more inventory to meet future demand, but also due to a transition in how we manage our production that requires a near term increase but, over time, will help constrain the growth of inventory to sales.”

Mr. Pape concluded, “Our ability to consistently expand our base of independent installers and dealerships resulted in significant revenue growth in the quarter. International sales account for 37% of our overall revenues as compared to 33% in the same period last year and we are excited about the added international traction that is being generated with our new U.K. facility. We believe XPEL’s growing brand recognition in the marketplace and our focus on training and support of our partners, position us well for long-term growth.”

Comments & Business Outlook

Thu, 29 Aug 2013 04:00:00 GMT

Second Quarter 2013 Results

Revenues increased 100% to $4,898,729 from $2,454,769 in Q2 2012.
EPS of $0.01 vs. $0.01 for the same quarter 2012.

Comments & Business Outlook

Wed, 29 May 2013 04:00:00 GMT

First Quarter 2013 Results

Revenues increased 58% to $3,156,582 from $1,993,597 in Q1 2012.

Net earnings. The Company had net income before taxes of $400,323 in Q1 2013 as compared to net income before taxes of $242,831 in Q1 2012. The Company had net income of $262,323 in Q1 2013 as compared to net income of $242,831 in Q1 2012.