- Net income was $0.5 million, or $0.7 million after adjusting for a $0.2 million non-cash trade name impairment charge, which compares to net income of $2.3 million in the first quarter of 2019
- Fully diluted earnings per share of $0.03, or $0.04 as adjusted
- Executing cost and debt reduction programs
- Targeting expense savings of up to $14 million annualized
- Reduced net debt by $11.7 million from $82.4 million at quarter-end to $70.7 million at May 5 and by over $20 million from its first-quarter peak
James Pokluda, President and Chief Executive Officer commented, “Throughout these challenging times, Houston Wire & Cable Company has excelled in serving the value chain as an essential business with superior operational performance while protecting the safety of its employees. Our teams mobilized quickly with virtual enterprise management solutions. Those employees who were able to work remotely shifted to their home offices, and our staff that was not able to work remotely practiced safe work and hygiene habits as guided by government authorities. The leadership team and I feel extraordinary gratitude for the outstanding efforts of our coworkers, and are humbled by the sacrifices they have made for the company.
During the first quarter, we were on track for sales growth until the impact of the global pandemic began in March. While we were taking actions to assure business continuity and superior customer service, we also increased our focus on prudent expense reduction and balance sheet improvement. We are well underway with expense reduction initiatives targeted to generate annualized savings of approximately $14 million and over $8 million in 2020. Our debt reduction actions during March and April have produced immediate results: as of May 5, net debt reduced by $11.7 million, to $70.7 million, from the end of the first quarter and by over $20 million from its peak during the quarter. Our banking relationship is strong, we are in compliance with the availability-based covenants and are focused on achieving a year-end debt target of $40 million through monetization of working capital. We will continue to report on our results throughout the year as we progress toward our year-end target.”
In addition to our expense reduction, on May 4th, we received a loan under the Small Business Administration’s Payroll Protection Program. These funds will be used to maintain employment and pay permissible operational expenses under the terms of the program.
Pokluda concluded, “We are combating the current economic challenges without compromising customer service, are properly equipped and structured to provide the essential products and services our country and customers require for recovery, and are getting immediate results with the actions we are taking to strengthen the Company.”
The Company will host a conference call to discuss first-quarter results on Friday, May 8, 2020, at 10:00 a.m., C.D.T. Hosting the call will be James Pokluda, President and Chief Executive Officer and Christopher Micklas, Vice President and Chief Financial Officer. This will be the last scheduled call, as the Company has determined to discontinue quarterly earnings calls going forward. However, we will continue to provide regular written updates on our business performance through our press releases and SEC filings.
A live audio web cast of the call will be available on the Investor Relations section of the Company’s website www.houwire.com.
Live call dial-in numbers are as follows:
Conference ID # 2499159
Approximately two hours after the completion of the live call, a telephone replay will be available until May 15, 2020.
Replay, Toll-Free #: (855)-859-2056
Replay, Toll #: (404)-537-3406
Conference ID # 2499159