XPEL Reports Third Quarter 2022 Results

XPEL, Inc. (Nasdaq: XPEL) a global provider of protective films and coatings, today announced results for the third quarter and nine months ended September 30, 2022.

Third Quarter 2022 Highlights:

• Revenues increased 31.0% to a record $89.8 million in the third quarter.
• Gross margin percentage improved to 39.8% in the third quarter, a new high for the Company.
• Net income grew 59.9% to $13.3 million, or $0.48 per share, compared to $8.3 million, or $0.30 per share, in the same quarter of 2021.
• EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) grew 66.0% to $18.9 million, or 21.1% of revenues compared to $11.4 million in third quarter 2021.¹

First Nine Months Highlights:

• Revenues increased 29.8% to $245.5 million in the first nine months of 2022.
• Gross margin percentage improved to 39.3% in the first nine months of 2022.
• Net income grew 30.2% to $33.0 million, or $1.20 per share, compared to $25.4 million, or $0.92 per share, in the first nine months of 2021.
• EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) grew 40.6% to $48.0 million, or 19.5% of revenues compared to $34.1 million in the first nine months of 2021.¹

Ryan Pape, President and Chief Executive Officer of XPEL, commented, “Our strong third quarter results reflect on-going momentum in the business even in the face of economic uncertainty. We saw solid performance across most of our regions and we look forward to continuing to build on this momentum as we close out the year.”

For the Quarter Ended September 30, 2022:

Revenues. Revenues increased approximately $21.2 million or 31.0% to $89.8 million as compared to $68.5 million in the third quarter of the prior year.

Gross Margin. Gross margin was 39.8% compared to 35.7% in the third quarter of 2021.

Expenses. Operating expenses increased to $18.5 million, or 20.6% of sales, compared to $14.1 million, or 20.6% of sales in the prior year period.

Net income. Net income was $13.3 million, or $0.48 per basic and diluted share, versus net income of $8.3 million, or $0.30 per basic and diluted share in the third quarter of 2021.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was $18.9 million, or 21.1% of sales, as compared to $11.4 million, or 16.6% of sales in the prior year¹.

For the Nine Months Ended September 30, 2022:

Revenues. Revenues increased approximately $56.4 million or 29.8% to $245.5 million as compared to $189.1 million in the first nine months of the prior year.

Gross Margin. Gross margin was 39.3% compared to 35.9% in the first nine months of 2021.

Expenses. Operating expenses increased to $53.4 million, or 21.7% of sales, compared to $36.4 million or 19.2% of sales in the prior year period.

Net income. Net income was $33.0 million, or $1.20 per basic and diluted share versus net income of $25.4 million, or $0.92 per basic and diluted share in the first nine months of 2021.

EBITDA. EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) was $48.0 million, or 19.5% of sales, as compared to $34.1 million, or 18.0% of sales in the prior year¹.

¹ See reconciliation of non-GAAP financial measures below

Conference Call Information

The Company will host a conference call and webcast today, November 9, 2022 at 11:00 a.m. Eastern Time to discuss the Company’s third quarter 2022 results.

To access the live webcast, please visit the XPEL, Inc. website at www.xpel.com/investor.

To participate in the call by phone, dial 888-506-0062 approximately five minutes prior to the scheduled start time. International callers please dial (973) 528-0011. Callers should use access code: 868222

A replay of the teleconference will be available until December 9, 2022 and may be accessed by dialing (877) 481-4010. International callers may dial (919) 882-2331. Callers should use conference ID: 46864.

About XPEL, Inc.

XPEL is a leading provider of protective films and coatings, including automotive paint protection film, surface protection film, automotive and architectural 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”.

Safe harbor statement

This release includes forward-looking statements regarding XPEL, Inc. and its business, which may include, but is not limited to, anticipated use of proceeds from capital transactions, expansion into new markets, and execution of the company's growth strategy. Often, but not always, forward-looking statements can be identified by the use of words such as "plans," "is expected," "expects," "scheduled," "intends," "contemplates," "anticipates," "believes," "proposes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may," "could," "would," "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations of the management of XPEL. The forward-looking events and circumstances discussed in this release may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the company, performance and acceptance of the company's products, economic factors, competition, the equity markets generally and many other factors beyond the control of XPEL. Although XPEL has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and XPEL undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

Reconciliation of Non-GAAP Financial Measure

EBITDA is a non-GAAP financial measure. EBITDA is defined as net income (loss) plus interest expense, net, plus income tax expense plus depreciation expense and amortization expense. EBITDA should be considered in addition to, not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. It is not a measurement of our financial performance under GAAP and should not be considered as alternatives to revenue or net income, as applicable, or any other performance measures derived in accordance with GAAP and may not be comparable to other similarly titled measures of other businesses. EBITDA has limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our operating results as reported under GAAP.

EBITDA does not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of ongoing operations and other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure.

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