WAUKESHA, WI — Generac , a global designer and manufacturer of generators and other engine powered products, has announced the signing of a purchase agreement to acquire the shares of Selmec Equipos Industriales, S.A. de C.V. and its wholly-owned subsidiaries from Enesa Energia, S.A. de C.V. and Enesa, S.A. de C.V. The agreement includes the power generator product and after-sale support services of the business.
Selmec, founded in 1941 and headquartered in Mexico City, is a designer and manufacturer of industrial generators from 10 kW to 2,750 kW. With approximately 300 employees and 100,000 square feet of production capacity, Selmec offers a service platform and specialized engineering capabilities, together with robust integration, project management and remote monitoring services.
“Selmec’s deep experience in standby energy solutions, specifically telecom, data center and other mission-critical applications, where power is essential for operational continuity, makes this a great fit for our Latin America strategy,” said Ricardo Navarro, Generac’s Senior Vice President - Latin America. “Acquiring Selmec will allow us to dynamically scale our existing Ottomotores business, leveraging both distribution and operational footprints of the combined businesses to offer the Latin American market a broader portfolio of products and solutions.”
The transaction is expected to close in three to six months following pending receipt of required regulatory approval.
Q4 and Full-Year 2017 Financials
Also on Wednesday, Generac reported financial results for its fourth quarter and full-year ended Dec. 31, 2017.
Fourth Quarter highlights
- Net sales increased 16.9 percent to $488 million, compared to $417.4 million in the prior-year fourth quarter, including $9.6 million of contribution from the Motortech acquisition.
- Net income attributable to the company during the fourth quarter was $81.2 million, compared to $41.5 million for the same period of 2016. The current year net income includes the impact of a $28.4 million non-cash gain, largely from the revaluation of the company’s net deferred tax liabilities associated with the enactment of the Tax Cuts and Jobs Act of 2017.
- Adjusted net income attributable to the company was $85.9 million, as compared to $71.4 million in the fourth quarter of 2016.
Full Year 2017 Highlights
- Net sales increased 15.8 percent to $1.672 billion during 2017 as compared to $1.444 billion during 2016, including $69.7 million of contribution from acquisitions, resulting in total organic sales growth for the year of 11.0 percent. Domestic segment sales increased 10.5 percent to $1.297 billion as compared to $1.174 billion in the prior year. International segment sales increased 38.8 percent to $375.9 million as compared to $270.9 million in the prior year.
- Net income attributable to the company during 2017 was $159.4 million, as compared to $98.8 million for 2016. Net income for 2017 includes the impact of the $28.4 million non-cash gain as a result of the Tax Reform Act. The prior-year net income includes the impact of $7.1 million of non-recurring, pre-tax charges relating to the downturn for capital spending within the oil & gas industry.
- Adjusted net income attributable to the company was $212.9 million, as compared to $198.3 million in 2016.