Zep, Inc. reported unaudited consolidated earnings results for the second quarter and six months ended February 28, 2013. Second quarter results reflected sales growth in retail, which were again driven by automotive aftermarket and by sales to new retailers, while its distribution channel again drove growth with industrial/MRO customers. In addition, acquisitions added approximately $17.4 million to net sales during the quarter. Revenue was $163.4 million, a 7.7% increase from $151.72 million for the second fiscal quarter of 2012. Net income was $2.8 million, a 14.7% increase compared to net income of $2.4 million in the second fiscal quarter of 2012. Diluted earnings per share were $0.12 compared to $0.11 in the second fiscal quarter of 2012. EBITDA was $11.8 million compared to $8.8 million in the second fiscal quarter of 2012. Operating profit was $6.65 million compared to $4.9 million reported a year ago. Income before provision for income taxes was $4.12 million compared to $3.95 million reported a year ago. Effective tax rate for the second quarter was 32.2% compared to 38.5% in the second quarter of 2012 resulting from lower permanent items and a discrete benefit related to the US-based research and development tax credit law change, which was retroactive to January 1, 2012. Free cash flow during the second quarter, defined as cash flow from operations less net capital expenditures, was a cash usage of $11.5 million during the quarter compared to a cash usage of $3.3 million in the prior year. Capital expenditures for the second quarter were $2.6 million, which represented a decrease of approximately $1.2 million compared to last year. The net debt position at the end of the quarter was approximately $260 million. For the six months, the company reported operating profit of $13.57 million, income before provision for income taxes of $9.64 million and net income of $6.27 million or $0.28 per diluted share on net sales of $321.41 million compared to operating profit of $13.30 million, income before provision for income taxes of $9.51 million and net income of $6.01 million or $0.27 per diluted share on net sales of $305.21 million reported a year ago. Net cash used for operating activities was $0.41 million compared to net cash provided by operating activities of $2.11 million reported a year ago. Purchases of property, plant, and equipment were $6.36 million compared to $7.50 million reported a year ago. For the fiscal 2013, the company expects a much smaller benefit in the second half, and now expect full year tax rate to be in the range of 36% to 37%. The company now expects total capital spending in fiscal 2013 to range between $14 million and $15 million, which include investments related to the Vehicle Care business.

Zep, Inc. announced that they will report Q2, 2013 results at 7:00 AM, US Eastern Standard Time on Apr 09, 2013

Zep, Inc., Q2 2013 Earnings Call, Apr 09, 2013