PITTSBURGH-- Wesco International, Inc. a leading provider of electrical, industrial, and communications MRO and OEM products, construction materials, and advanced supply chain management and logistics services, today announced its 2010 fourth quarter and full-year financial results.
The following are results for the quarter-ended December 31, 2010 compared to the quarter-ended December 31, 2009:
-- Consolidated net sales were $1,331.6 million, compared to $1,132.7 million, an increase of 17.6%. Fourth quarter 2010 organic sales growth was 15.8% excluding a 1.1% positive impact from acquisitions and a 0.7% positive impact from foreign exchange rates. Fourth quarter 2010 sales increased 0.5% sequentially.
-- Gross profit was $270.3 million, or 20.3% of sales, for the fourth quarter of 2010, compared to $217.0 million, or 19.2% of sales, for the fourth quarter of 2009. Increased sales performance in the fourth quarter resulted in additional supplier volume rebates and favorable inventory adjustments which contributed to the improvement in gross margins.
-- Sales, general & administrative (SG&A) expenses were $204.1 million, or 15.3% of sales, for the current quarter, compared to $168.3 million, or 14.9% of sales, for the fourth quarter of 2009. Wesco's fourth quarter 2009 SG&A expenses included a net favorable impact of approximately $6.0 million related to temporary cost and discretionary benefit reductions.
-- Operating profit was $60.0 million, or 4.5% of sales, for the current quarter, compared to $42.6 million, or 3.8% of sales, for the comparable 2009 quarter. After adjusting for the 2009 impact of the temporary cost and discretionary benefit reductions, operating margins improved by approximately 130 basis points.
-- Net income for the current quarter was $34.8 million compared to $21.8 million for the prior year quarter, an increase of 59.6%. The resolution of the previously mentioned tax matter, net of other international tax items, decreased fourth quarter 2010 net income by $1.3 million.
Mr. John J. Engel, Wesco 's Chief Executive Officer, stated, "Our fourth quarter results marked a strong close to an excellent year. Execution of our growth strategy is on track and we are pleased with the increasing momentum in our business during 2010. After declining 3% in the first quarter, sales grew 9% in the second quarter, 15% in the third quarter, and 18% in the fourth quarter, resulting in full-year growth of 10%. Backlog was also up 18% versus prior year end. We delivered strong operating margin expansion and free cash flow generation in 2010, reflecting effective operating leverage and efficient asset management. In addition, we strengthened the portfolio with the acquisitions of Potelcom in June and TVC Communications in December. We see excellent opportunities to continue to invest in our business and further improve our market position in 2011."
The following results are for the full-year period ended December 31, 2010 compared to the full-year period ended December 31, 2009:
-- Consolidated net sales were $5,063.9 million compared to $4,624.0 million, an increase of 9.5%. Consolidated net sales included a 1.3% positive impact from foreign exchange rates and a 0.4% positive impact from acquisitions.
-- Gross profit was $998.5 million, or 19.7% of sales, compared to $899.9 million, or 19.5% of sales.
-- SG&A expenses were $763.6 million, or 15.1% of sales, compared to $693.9 million, or 15.0% of sales. Wesco 's 2009 SG&A expenses included a net favorable impact of approximately $25.0 million related to temporary cost and discretionary benefit reductions.
-- Operating profit was $211.0 million, or 4.2% of sales, compared to $180.0 million, or 3.9% of sales. After adjusting for the 2009 impact of the temporary cost and discretionary benefit reductions, operating margins improved by approximately 80 basis points.
-- Net income for the full-year was $115.5 million compared to $105.1 million for the prior year.Mr. Engel continued, "We expect the market will remain highly competitive as a gradual global economic recovery continues in 2011. We are focused on building on our 2010 successes as we continue to execute our strategy, accelerate our growth initiatives, and expand our geographic footprint and customer base. I am very proud of the results delivered by all Wesco employees in 2010 and I am confident in our team's ability to produce outstanding results again in 2011."