COCONUT GROVE, Fla., Dec. 03, 2019 (GLOBE NEWSWIRE) -- Watsco, Inc. (NYSE : WSO) announced today that it has completed the acquisition of N&S Supply, a distributor of air conditioning, heating and plumbing products based in Fishkill, New York. N&S Supply had revenues of approximately $44 million over the last twelve months.
Founded in 1946, N&S Supply operates seven locations in the Hudson Valley of New York and Connecticut. The Company serves over 10,000 customers with approximately 40,000 SKUs, including air conditioning and heating equipment, hydronic heating equipment, complimentary parts and supplies and a variety of plumbing products. Terms of the acquisition were not disclosed. Consideration for the purchase included a combination of cash and Watsco common stock.
Albert H. Nahmad, Watsco’s Chairman and CEO, stated: “N&S Supply has a wonderful legacy and we are proud to become part of their family. As is our custom, the company will operate under its existing name under the direction of its current leadership team to provide continuity to customers, employees and vendor partners. Their reputation and success are built on a tradition of great service and a broad range of products from convenient locations and we look forward to assisting them to achieve their growth plans.”
Expansion & Growth in the Northeastern Market
This acquisition expands Watsco’s sales presence in the Northeast U.S., which has grown from approximately $70 million in 2010 to a present run-rate of over $700 million. N&S Supply compliments other Watsco acquisitions completed in 2019, including the purchase of Dasco Supply, based in Whippany, New Jersey, Peirce-Phelps based in Philadelphia, Pennsylvania and an incremental 20% ownership in Homans Associates based in Wilmington, Massachusetts.
Mr. Nahmad commented: "Watsco builds density in markets to improve customer service and to provide vendor partners with growth opportunities. N&S Supply enhances our strong and growing footprint in the Northeast.”
Watsco’s Buy & Build Philosophy
The acquisition of N&S Supply is consistent with Watsco’s ‘buy-and-build’ strategy. Since 1989, Watsco has acquired over 60 businesses to become the established industry leader. This strategy has produced a 30-year compounded annual growth rate for total-shareholder-return of 18.2%, which ranks Watsco among the best performing public companies over this time period. Key components of Watsco’s buy-and-build strategy include:
- identify and partner with great businesses
- retain the leadership team, honor their culture and empower them
- ask for aggressive growth plans and help them achieve their ambitions
- motivate the team with long-term equity and establish an ownership culture
- deploy the industry’s most comprehensive suite of technologies
- solicit and collaborate on big ideas to foster a spirit of innovation and growth
Mr. Nahmad added: “We remain highly active and desire to make additional investments in other great businesses in our industry. Our balance sheet remains conservative and well-positioned to take advantage of almost any-size opportunity.”
Expansion & Leveraging of Technology
N&S Supply will join Watsco’s culture of innovation. In recent years, substantial investments have been made to develop and launch a variety of customer-obsessed technologies to enhance and transform the customer experience. These technologies also offer homeowners and business-owners a more productive and valuable means to purchase products and services from our customers.
Ongoing initiatives include: (i) mobile applications to help customers operate more productively and interact with our locations more efficiently; (ii) e-commerce between our customers and our business locations; (iii) supply chain optimization; and (iv) building and maintaining the largest source of digitized HVAC/R product information. In addition, Watsco has developed, internally and through external collaboration, a variety of early-stage technologies meant to help contractor customers grow faster and become more profitable.
A.J. Nahmad, Watsco’s President said: “The team at N&S Supply are forward-thinking. The opportunity to modernize and digitize their business played an important role in their decision to become part of Watsco. We look forward to working with their team and customers.”
About Watsco
Watsco is the largest distribution network for heating, air conditioning and refrigeration (HVAC/R) products with locations in the United States, Canada, Mexico and Puerto Rico, and on an export basis to Latin America and the Caribbean. Watsco estimates that over 300,000 contractors and technicians visit or call one of its 610 locations each year to get information, obtain technical support and buy products. HVAC/R products provide comfort to homes and businesses regardless of the outdoor climate. There are approximately 91 million central air conditioning and heating systems installed in the United States that have been in service more than 10 years. Older systems often operate below today’s government mandated energy efficiency and environmental standards. Watsco has an opportunity to accelerate the replacement of these systems at a scale greater than its competitors as the movement toward reducing energy consumption and its environmental impact continues. This is especially important since heating and cooling accounts for approximately half of the energy consumed in a typical U.S. home. Additional information about Watsco may be found at http://www.watsco.com.
