Pool Corp. (NASDAQ:POOL) Q4 2019 Earnings Conference Call - Final Transcript

Feb 13, 2020 • 11:00 am ET

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Pool Corp. (NASDAQ:POOL) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, and welcome to the Pool Corporation Fourth Quarter 2019 Conference Call. [Operator Instructions]

I would now like to turn the conference over to Mark Joslin, Senior Vice President and Chief Financial Officer. Please go ahead, sir.

Executive
Mark W. Joslin

Thank you, Rocco. Good morning, everyone, and welcome to our year-End 2019 Earnings Call. I would like to remind our listeners that our discussion, comments and responses to questions today may include forward-looking statements, including management's outlook for 2020 and future periods. Actual results may differ materially from those discussed today. Information regarding the factors and variables that could cause actual results to differ materially from projected results is discussed in our 10-K, the latest edition of which will be filed at the end of this month. In addition, we may make references to non-GAAP financial measures in our comments. A description and reconciliation of our non-GAAP financial measures is included in our press release and posted to our corporate website in our Investor Relations section.

Now I'll turn the call over to our President and CEO, Peter Arvan.

Executive
Peter D. Arvan

Thank you, Mark, and good morning to everyone on the call. 2019 was another solid year for POOLCORP. Overall demand remained healthy and our dealer base optimistic. While the weather caused some challenges early in the year, the team's focus on execution, capacity creation and organic growth drove record sales and profitability while helping our customers be more productive as well. For 2019, total sales came in at $3.2 billion. This represents a $200 million or 7% increase over 2018. In the fourth quarter, our revenue also increased by 7%, which was on top of the 6% overall growth we saw in the fourth quarter of 2018 and the 15% growth that we saw in 2017. From a base business perspective, sales increased 7% in the fourth quarter, bringing the total year base business increase to 5%, which is a nice recovery from earlier in the year. For reference, we reported a 1% base business sales growth in the first quarter and a 4% in the second quarter. So through the first half, we had posted a 3% gain, which highlights the significance of the 5% base business growth for the full year 2019.

Looking at just the year-round market, the base business grew by 6% for the quarter. And on a full year basis, we saw revenues up 5%. Again, poor weather in the first and seasonally significant second quarter weighed heavily on the total year, particularly in California and Texas, where it was colder and wetter than 2018. The resilience of our team and the markets allowed us to make up significant ground as the year went on. Our dealers are reporting a very solid backlog for 2020 season, which is yet another positive sign of the overall market conditions. Moving on to a few notable end markets. We continue to gain traction in the commercial pool area, as we saw revenue growth of 8% for the year and 6% for the