HD Supply Waterworks Acquires RAMSCO, Reports Fiscal 2010 Results
HD Supply Waterworks (St. Louis, MO), an HD Supply business that distributes a complete line of water, sewer, fire protection and storm drain products to serve the needs of contractors and municipalities in the water, wastewater, storm and fire protection markets, announced it has entered into a definitive agreement to purchase Rexford-Albany Municipal Supply Co. (RAMSCO).
Headquartered in Watervliet, NY, RAMSCO is a full-line waterworks distributor specializing in water, sanitary and storm sewer materials and services.
RAMSCO currently operates four branches located in New York State, including Watervliet, Utica, Rochester and Binghamton.
The business will be fully integrated into HD Supply Waterworks and will begin operating under the HD Supply Waterworks brand while continuing to provide water and sewer materials services to existing customers.
"This acquisition is extremely important for us because it will solidify our ability to provide value-added services to our customers in the Northeast region,” HD Supply Waterworks Regional Vice President, Jack Schaller, said in a statement.
HD Supply Waterworks currently operates more than 240 branches in 42 states.
Fiscal 2010 Results
In other news, HD Supply released its fiscal year 2010 and fourth quarter of fiscal 2010 results on April 14.
- Net sales were $7.5 billion for the fiscal year 2010 ended Jan. 30, 2010, up 0.8% vs. the full year of fiscal 2009.
- Gross profit increased by 4.1% to $2.1 billion in fiscal year 2010.
- Gross profit for the fiscal year 2010 was 27.8% of net sales vs. 26.9% of net sales for full-year fiscal 2009.
- Operating income for the full year fiscal 2010 was $32 million. This was an increase of $354 million compared to fiscal 2009, which included a $224 million pre-tax goodwill impairment charge. Excluding the goodwill impairment charge in fiscal 2009, adjusted operating income for fiscal 2010 Was up $130 million vs. the prior year.
Consolidated loss from continuing operations for the full year of fiscal 2010 was $619 million, compared to a loss from continuing operations of $505 million for the full year of fiscal 2009.
Loss from continuing operations in fiscal 2010 and fiscal 2009 included $230 million and $7 million, respectively, of non-cash charges to increase the valuation allowance against the company’s deferred tax assets. In addition, loss from continuing operations in fiscal 2009 included a $224 million pre-tax goodwill impairment charge ($186 million after-tax) and a non-operating, non-cash pre-tax gain of $200 million ($123 million after-tax) resulting from the extinguishment of senior subordinated debt. Excluding these items, adjusted loss from continuing operations of $389 million in fiscal 2010 improved $46 million as compared with the adjusted loss from continuing operations of $435 million in fiscal 2009.
Fourth Quarter Results
HD Supply reported net sales of $1.7 billion for the fiscal 2010 fourth quarter ended Jan. 30, 2011, an increase of 6.7% compared to the fourth quarter of fiscal 2009.
Gross profit for the fourth quarter increased by 12.7%. Fourth quarter gross profit was 28.3% of net sales vs. 26.8% percent of net sales for the fourth quarter of fiscal 2009.
Operating loss for the fourth quarter of fiscal 2010 was $11 million, an improvement of $87 million compared to an operating loss of $98 million for the fourth quarter of fiscal 2009.
Liquidity at the end of the fourth quarter of fiscal 2010 was $1.3 billion, an increase of approximately $426 million vs. the end of fiscal 2009.
Excluding the 2010 and 2009 charges for the deferred tax valuation allowances, adjusted loss from continuing operations of $115 million in the fourth quarter of fiscal 2010 improved $52 million as compared with the adjusted loss from continuing operations of $167 million in the fourth quarter of fiscal 2009.
“In 2010, our associates’ continued focus on our customers and our significant investments in the company to accelerate sales and growth momentum enabled us to gain market share and report year-over-year improved financial results, the first since 2007. Furthermore, our liquidity remains very strong, which allows us to meet our commitments and continuously invest in profitable growth,” stated Joe DeAngelo, CEO, HD Supply.