Alpha Pro Tech, Ltd. (NYSE American: APT), a
leading manufacturer of products designed to protect people,
products and environments, including disposable protective apparel
and building products, today announced financial
results
for the three month period and year
ended December 31, 2021.
Lloyd Hoffman, President and Chief Executive
Officer of Alpha Pro Tech, commented, “The decrease in Disposable
Protective Apparel segment sales in 2021 was driven by reduced
demand in both our facemasks, primarily our N-95 Particulate
Respirator face mask and face shields, partially offset by COVID-19
associated usage of our protective garments. Although face mask and
face shield sales were down in 2021, they were higher than any
other year on record, with the exception of the past pandemics in
2020 (COVID-19) and 2009 (H1N1). Due to various COVID-19 variants,
sales of face masks and face shields are expected to remain higher
than pre-pandemic levels in the first quarter of 2022, but it’s
uncertain how long this will continue.”
“Our Building Supply segment sales were a record
for the year ended December 31, 2021, with continued significant
growth due to strong demand for both our synthetic roof
underlayment and housewrap products. Synthetic roof underlayment
sales were a record in 2021 and increased by 25.9% compared to 2020
due to the increase in inventory requirements at the dealer level,
as well as the expansion of new home construction. Growth of our
synthetic roof underlayment products was primarily due to robust
sales of our TECHNO SB®25 product line, which was the growth driver
of this product family in 2021.The housewrap line of products, with
a 19.7% increase in 2021, also achieved a record due to growth in
new market share as well as high demand for new home construction.
Our system of selling housewrap with associated accessories is
becoming increasingly accepted in the market.
The Company has committed to increasing
production capacity in our Building Supply segment by investing
approximately $4.0 million in new equipment, a part of which became
operational in the latter part of the third quarter of 2021. As a
result of delays in the supply chain, the most expensive piece of
equipment has had a further delay and is now expected in the latter
part of the second quarter of 2022 and is expected to be
operational in the third quarter of 2022.
We are encouraged by the current demand for our
Building Supply products and anticipate strong continued growth in
2022. We have continued to enjoy increased sales by utilizing a
strategic approach to adding additional dealers through aggressive
sales strategies, being vertically integrated and having control of
our manufacturing, unlike most of our competitors. By adding the
additional dealers, distribution channels and additional products
in the roofing sector, we expect to maintain our sales growth. We
expect our housewrap sales to continue to grow with new home
construction remaining high as well as our ability to deliver
products in a timely fashion by utilizing our vertically integrated
manufacturing capabilities. This coupled with our growing
distribution channels has been the backbone of our sales growth,”
added Hoffman.
2021 Results
Net Sales
Consolidated sales for the three months
ended December 31, 2021, decreased to $13.2 million, from
$29.0 million for the three months ended December 31, 2020,
representing a decrease of $15.8 million, or 54.5%. This decrease
consisted of decreased sales in the Disposable Protective Apparel
segment of $16.6 million partially offset by increased sales in the
Building Supply segment of $0.8 million.
Disposable Protective Apparel segment
sales for the three months ended December 31, 2021
decreased by $16.6 million, or 78.6%, to $4.5 million, compared to
$21.1 million for the same period of 2020. This segment decrease
was due to a 95.0% decrease in sales of face masks, primarily our
proprietary N-95 Particulate Respirator face mask, a 46.9% decrease
in sales of face shields and a 32.6% decrease in sales of
disposable protective garments compared to the same period of 2020,
all primarily due to record breaking customer demand resulting from
the COVID-19 pandemic in 2020.
The sales mix of the Disposable Protective
Apparel segment for the three months ended December 31, 2021 was
approximately 73% for disposable protective garments, 17% for face
masks and 10% for face shields. This compared to approximately 23%
for disposable protective garments, 73% for face masks and 4% for
face shields for the three months ended December 31, 2020.
Building Supply segment sales
for the three months ended December 31, 2021 increased by $0.8
million, or 9.8%, to $8.7 million, compared to $7.9 million for the
three months ended December 31, 2020.
Consolidated sales for the year ended
December 31, 2021, decreased to $68.6 million, second
highest in Company history, from $102.7 million for the year ended
December 31, 2020, representing a decrease of $34.1 million, or
33.2%. This decrease consisted of decreased sales in the Disposable
Protective Apparel segment of $40.4 million, partially offset by a
$6.3 million increase in sales for the Building Supply segment.
Sales for the Disposable Protective
Apparel segment for the year ended December 31, 2021,
decreased by $40.4 million, or 56.0%, to $31.7 million, compared to
$72.1 million for 2020. This segment decrease was due to a 3.5%
increase in sales of disposable protective garments, an 80.0%
decrease in sales of face masks and a 68.0% decrease in face
shields, all primarily due to customer demand associated with the
pandemic in 2020.
The sales mix of the Disposable Protective
Apparel segment for the year ended December 31, 2021 was
approximately 63% for disposable protective garments, 26% for face
masks and 11% for face shields. This sales mix is compared to
approximately 27% for disposable protective garments, 58% for face
masks and 15% for face shields for the year ended December 31,
2020.
Building Supply segment sales
for the year ended December 31, 2021 increased by $6.3 million, or
20.6%, to a record $36.9 million, compared to $30.6 million for the
year ended December 31, 2020. The Building Supply segment increase
was primarily due to an increase in sales of synthetic roof
underlayment of 25.9%, an increase in sales of housewrap and
accessories of 19.7% and basically flat sales of other woven
material compared to 2020.
The sales mix of the Building Supply segment for
the year ended December 31, 2021 was approximately 50% for
synthetic roof underlayment, 43% for housewrap and accessories, and
7% for other woven material. This compared to approximately 48% for
synthetic roof underlayment, 43% for housewrap and accessories, and
9% for other woven material for the year ended December 31,
2020.
Gross Profit
Gross profit decreased by $9.2 million, or
65.1%, to $4.9 million for the three months ended December 31,
2021, from $14.2 million for the three months ended December 31,
2020. The gross profit margin was 37.5% for the three months ended
December 31, 2021, compared to 48.9% for the three months ended
December 31, 2020.
Gross profit decreased by $25.2 million, or
49.9%, to $25.3 million for the year ended December 31, 2021, from
$50.5 million for the year ended December 31, 2020. The gross
profit margin was 36.7% for the year ended December 31, 2021,
compared to 49.2% for the year ended December 31, 2020. Gross
profit margin in 2021 was similar to pre-pandemic levels. The gross
profit margin was negatively affected in 2021 as a result of
changes in product mix as the need for face masks and face shields,
which have a higher gross profit margin than our other products,
declined from the surge in customer demand in 2020 as a result of
the COVID-19 pandemic, as well as increases in raw material costs
and ocean freight and other transportation costs.
Going forward, management believes that gross
profit margin could continue to be negatively affected by the
recent significant increases in ocean freight and other
transportation costs as well as raw material price increases. In
the current environment, cost increases may rise more rapidly than
our sales prices, which could continue to decrease gross profit
margin.
Selling, General and Administrative
Expenses
Selling, general and administrative expenses
decreased by $1.0 million, or 21.1%, to $3.9 million for the three
months ended December 31, 2021, from $4.9 million for the three
months ended December 31, 2020. However, as a percentage of net
sales, selling, general and administrative expenses increased to
29.5% for the three months ended December 31, 2021, up from 17.0%
for the same period of 2020, primarily as a result of lower net
sales.
Selling, general and administrative expenses
decreased by $1.6 million, or 8.9%, to $16.6 million for the year
ended December 31, 2021, from $18.2 million for the year ended
December 31, 2020. However, as a percentage of net sales, selling,
general and administrative expenses increased to 24.1% for the year
ended December 31, 2021, down from 17.7% for 2020, primarily as a
result of lower net sales.
Income from Operations
Income from operations decreased by $8.2 million
or 90.7%, to $846,000 for the three months ended December 31, 2021,
compared to $9.1 million for the three months ended December 31,
2020. The decreased income from operations was primarily due to a
decrease in gross profit of $9.2 million and an increase in
depreciation and amortization expense of $23,000, partially offset
by a decrease in selling, general and administrative expenses of
$1.0 million. Income from operations as a percentage of net sales
for the three months ended December 31, 2021 was 6.4%, compared to
31.2% for the same period of 2020.
Income from operations decreased by $23.7
million, or 74.9%, to $7.9 million for the year ended December 31,
2021, compared to $31.6 million for the year ended December 31,
2020. The decreased income from operations was primarily due to a
decrease in gross profit of $25.2 million and an increase in
depreciation and amortization expense of $0.1 million, partially
offset by a decrease in selling, general and administrative
expenses of $1.6 million. Income from operations as a percentage of
net sales for the year ended December 31, 2021 was 11.5%, compared
to 30.8% for 2020.
Net Income
Net income for the three months ended December
31, 2021 was $0.6 million, compared to net income of $7.2
million for the three months ended December 31, 2020, representing
a decrease of $6.6 million or 91.7%. Net income as a percentage of
net sales for the three months ended December 31, 2021 was 4.5%,
and net income as a percentage of net sales for the same period of
2020 was 24.9%. Basic earnings per common share for the three
months ended December 31, 2021, and 2020 were $0.05 and $0.53,
respectively. Diluted earnings per common share for the three
months ended December 31, 2021 and 2020 were $0.05 and $0.52,
respectively.
Net income for the year ended December 31, 2021
was $6.8 million, compared to net income of $26.9 million for the
year ended December 31, 2020, representing a decrease of $20.1
million or 74.9%. The decrease in net income was largely associated
with the COVID-19 pandemic in 2020. The net income decrease
comparing the years ended December 31, 2021 and 2020 was due to a
decrease in income before provision for income taxes of $23.7
million, partially offset by a decrease in provision for income
taxes of $3.6 million. A tax benefit from stock options exercised
positively impacted net income in the first quarter of 2020 by an
estimated $2.0 million. Net income as a percentage of net sales for
the year ended December 31, 2021 was 9.8%, and net income as a
percentage of net sales for 2020 was 26.2%. Basic earnings per
common share for the year ended December 31, 2021, and 2020 were
$0.51 and $2.00, respectively. Diluted earnings per common share
for the year ended December 31, 2021 and 2020 were $0.50 and $1.92,
respectively. Diluted earnings per common share prior to COVID-19
for the years ended December 31, 2019 and 2018 were $0.23 and
$0.26, respectively.
Balance Sheet
As of December 31, 2021, the Company had cash of
$16.3 million compared to $23.3 million as of December 31, 2020.
The decrease in cash as of December 31, 2021 was due to cash used
in operating activities of $0.5 million, cash used in investing
activities of $2.5 million and cash used in financing activities of
$4.0 million. Working capital totaled $50.3 million and the
Company’s current ratio was 20:1, as of December 31, 2021, compared
to a current ratio of 9:1 as of December 31, 2020.
Inventory increased by $8.2 million or 49.1%, to
$24.9 million as of December 31, 2021, from $16.7 million as of
December 31, 2020. The increase was primarily due to an increase in
inventory for the Disposable Protective Apparel segment of $4.7
million or 41.2%, to $16.2 million and an increase in inventory for
the Building Supply segment of $3.5 million or 66.3%, to $8.7
million.
Colleen McDonald, Chief Financial Officer,
commented, “During the year ended December 31, 2021, we repurchased
439,000 shares of common stock at a cost of $4.4 million. As of
December 31, 2021, we had repurchased a total of 18,549,917 shares
of common stock at a cost of approximately $42.4 million through
our repurchase program. We retire all stock upon repurchase. Future
repurchases are expected to be funded from cash on hand and cash
flows from operating activities. As of December 31, 2021, we had
$2.1 million available for additional stock purchases under our
stock repurchase program.”
The Company currently has no outstanding debt
and believes that the current cash balance will be sufficient to
satisfy projected working capital needs and planned capital
expenditures for the foreseeable future. The company has made
approximately $4.0 million in commitments for capital investments
to increase their production capacity in the Building Supply
segment, of which approximately $1.0 million remains to be paid as
of December 31, 2021.
About Alpha Pro Tech, Ltd.Alpha
Pro Tech, Ltd. is the parent company of Alpha Pro Tech, Inc. and
Alpha ProTech Engineered Products, Inc. Alpha Pro Tech, Inc.
develops, manufactures and markets innovative disposable and
limited-use protective apparel products for the industrial, clean
room, medical and dental markets. Alpha ProTech Engineered
Products, Inc. manufactures and markets a line of construction
weatherization products, including building wrap and roof
underlayment. The Company has manufacturing facilities in Salt Lake
City, Utah; Nogales, Arizona; Valdosta, Georgia; and a joint
venture in India. For more information and copies of all news
releases and financials, visit Alpha Pro Tech’s website at
http://www.alphaprotech.com.
Certain statements made in this press release
constitute “forward-looking statements” within the meaning of the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Forward-looking statements include any statement that
may predict, forecast, indicate or imply future results,
performance or achievements instead of historical facts and may be
identified generally by the use of forward-looking terminology and
words such as “expects,” “anticipates,” “estimates,” “believes,”
“predicts,” “intends,” “plans,” “potentially,” “may,” “continue,”
“should,” “will” and words of similar meaning. Without limiting the
generality of the preceding statement, all statements in this press
release relating to estimated and projected
earnings, expectations regarding order volume, timing of
fulfillment of orders, production capacity and our plans to
ramp up production and expand capacity, product
demand, availability of raw materials and supply chain access,
margins, costs, expenditures, cash flows, sources of capital,
growth rates and future financial and operating results are
forward-looking statements. We caution investors that any such
forward-looking statements are only estimates based on current
information and involve risks and uncertainties that may cause
actual results to differ materially from the results contained in
the forward-looking statements. We cannot give assurances that any
such statements will prove to be correct. Factors that could cause
actual results to differ materially from those estimated by us
include the risks, uncertainties and assumptions described from
time to time in our public releases and reports filed with the
Securities and Exchange Commission, including, but not limited to,
our most recent Annual Report on Form 10-K. Specifically,
these factors include, but are not limited to, changes in global
economic conditions; the effects of the COVID-19 pandemic on our
business and operations, the business and operations of those
within our supply chain and global economic conditions generally;
changes in order volume by our customers; the inability of our
suppliers and contractors to meet our requirements; potential
challenges related to international manufacturing; our partnership
with a joint venture partner; the inability to protect our
intellectual property; competition in our industry; customer
preferences; the timing and market acceptance of new product
offerings; security breaches or disruptions to the information
technology infrastructure; the impact of legal and regulatory
proceedings or compliance challenges; and volatility in our common
stock price and our investments. We also caution investors
that the forward-looking information described herein represents
our outlook only as of this date, and we undertake no obligation to
update or revise any forward-looking statements to reflect events
or developments after the date of this press release. Given these
uncertainties, investors should not place undue reliance on
forward-looking statements as a prediction of actual results.
-- Tables follow --
Consolidated Balance Sheets
|
|
|
|
|
|
|
December 31, |
|
December 31, |
|
|
|
|
|
|
|
2021 |
|
2020 |
Assets |
|
|
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
$ |
16,307,000 |
|
$ |
23,292,000 |
|
Accounts receivable, net of allowance for doubtful accounts of |
|
|
|
|
|
$64,000 as of December 31, 2021 and $71,000 as of December 31,
2020 |
|
|
|
|
|
3,397,000 |
|
|
8,132,000 |
|
Accounts receivable, related party |
|
1,383,000 |
|
|
905,000 |
|
Inventories |
|
24,969,000 |
|
|
16,749,000 |
|
Prepaid expenses |
|
6,943,000 |
|
|
6,087,000 |
|
|
Total current assets |
|
52,999,000 |
|
|
55,165,000 |
|
|
|
|
|
|
|
|
|
|
Property and equipment, net |
|
6,064,000 |
|
|
4,353,000 |
Goodwill |
|
|
55,000 |
|
|
55,000 |
Definite-lived intangible assets, net |
|
3,000 |
|
|
7,000 |
Right-of-use assets |
|
2,648,000 |
|
|
3,535,000 |
Equity investment in unconsolidated affiliate |
|
6,120,000 |
|
|
5,549,000 |
|
|
Total assets |
$ |
67,889,000 |
|
$ |
68,664,000 |
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
$ |
528,000 |
|
$ |
1,983,000 |
|
Accrued liabilities |
|
1,250,000 |
|
|
2,793,000 |
|
Customer advance payments of orders |
|
- |
|
|
209,000 |
|
Lease liabilities |
|
883,000 |
|
|
867,000 |
|
|
Total current liabilities |
|
2,661,000 |
|
|
5,852,000 |
|
|
|
|
|
|
|
|
|
|
Lease liabilities, net of current portion |
|
1,817,000 |
|
|
2,719,000 |
Deferred income tax liabilities, net |
|
791,000 |
|
|
563,000 |
|
|
Total liabilities |
|
5,269,000 |
|
|
9,134,000 |
Commitments and contingencies |
|
|
|
Shareholders' equity: |
|
|
|
|
Common stock, $.01 par value: 50,000,000 shares authorized; |
|
|
|
|
|
13,115,341 and 13,419,847 shares outstanding as of |
|
|
|
|
|
December 31, 2021 and December 31, 2020, respectively |
|
132,000 |
|
|
135,000 |
|
Additional paid-in capital |
|
- |
|
|
409,000 |
|
Retained earnings |
|
62,488,000 |
|
|
58,986,000 |
|
|
Total shareholders' equity |
|
62,620,000 |
|
|
59,530,000 |
|
|
Total liabilities and shareholders' equity |
$ |
67,889,000 |
|
$ |
68,664,000 |
Condensed Consolidated Statements of Income
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
|
|
|
|
|
|
December 31, |
|
December 31, |
|
|
|
|
|
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
$ |
13,195,000 |
|
|
$ |
29,019,000 |
|
|
$ |
68,637,000 |
|
$ |
102,700,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold, excluding depreciation |
|
|
|
|
|
|
|
and amortization |
|
8,250,000 |
|
|
|
14,840,000 |
|
|
|
43,339,000 |
|
|
52,218,000 |
|
Gross profit |
|
4,945,000 |
|
|
|
14,179,000 |
|
|
|
25,298,000 |
|
|
50,482,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
Selling, general and administrative |
|
3,893,000 |
|
|
|
4,935,000 |
|
|
|
16,554,000 |
|
|
18,171,000 |
|
Depreciation and amortization |
|
206,000 |
|
|
|
183,000 |
|
|
|
817,000 |
|
|
729,000 |
|
Total operating expenses |
|
4,099,000 |
|
|
|
5,118,000 |
|
|
|
17,371,000 |
|
|
18,900,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
|
846,000 |
|
|
|
9,061,000 |
|
|
|
7,927,000 |
|
|
31,582,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses): |
|
|
|
|
|
|
|
Equity in income (loss) of unconsolidated affiliate |
|
(52,000 |
) |
|
|
254,000 |
|
|
|
571,000 |
|
|
710,000 |
|
Loss from marketable securities |
|
- |
|
|
|
(20,000 |
) |
|
|
- |
|
|
(62,000 |
) |
Interest income, net |
|
- |
|
|
|
1,000 |
|
|
|
2,000 |
|
|
18,000 |
|
Total other income (loss), net |
|
(52,000 |
) |
|
|
235,000 |
|
|
|
573,000 |
|
|
666,000 |
|
Income before provision |
|
|
|
|
|
|
|
for income taxes |
|
794,000 |
|
|
|
9,296,000 |
|
|
|
8,500,000 |
|
|
32,248,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
194,000 |
|
|
|
2,076,000 |
|
|
|
1,744,000 |
|
|
5,360,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
600,000 |
|
|
$ |
7,220,000 |
|
|
$ |
6,756,000 |
|
$ |
26,888,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share |
$ |
0.05 |
|
|
$ |
0.53 |
|
|
$ |
0.51 |
|
$ |
2.00 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per common share |
$ |
0.05 |
|
|
$ |
0.52 |
|
|
$ |
0.50 |
|
$ |
1.92 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average common shares outstanding |
|
13,138,096 |
|
|
|
13,505,909 |
|
|
|
13,225,628 |
|
|
13,449,987 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted average common shares outstanding |
|
|
|
|
|
|
|
13,302,013 |
|
|
|
13,947,738 |
|
|
|
13,499,442 |
|
|
13,972,145 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Out-of-period adjustmentDuring the fourth quarter of 2021, the
Company recorded an out-of-period adjustment to correct an error
related to a prior year which increased income tax expense by $0.2
million and deferred tax liabilities by $0.1 million and decreased
retained earnings by $0.3 million in 2020.
Company Contact: |
Investor Relations Contact: |
Alpha Pro Tech,
Ltd. |
HIR Holdings |
Donna Millar |
Cameron Donahue |
905-479-0654 |
651-707-3532 |
e-mail: ir@alphaprotech.com |
e-mail: cameron@hirholdings.com |
Grafico Azioni Alpha Pro Tech (AMEX:APT)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni Alpha Pro Tech (AMEX:APT)
Storico
Da Giu 2023 a Giu 2024