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CaesarStone (CSTE) reports earnings, surges 15%

CaesarStone (CSTE) surged more than 15% on market open when the company reported its earnings for the quarter. CaesarStone  is leading developer and manufacturer of high-quality engineered surfaces.

First Quarter Revenue Grew 15.4% Over Prior Year to $146.0 Million with Per Share Diluted Net Income of $0.41 and Adjusted Diluted EPS of $0.42.

The Gross Margin Expanded 90 Basis Points to 29.7% and Adjusted EBITDA Increased 54.1% to $20.3 Million at a 13.9% Margin.

The company also reported to have strong cash position of over $100 million ending the quarter. With a strong cash position CaesarStone announced that it will be commencing a $0.21 per share dividend.

CaesarStone’s dividend and outlook

The Company’s dividend policy provides for a quarterly cash dividend of up to 50% of reported net income on a year-to-date basis, less any amount already paid as dividend for the respective period, subject in each case to approval by the Company’s board of directors.

No dividend is paid if it would be less than $0.10 per share. In accordance with the Company’s dividend policy, the board of directors declared a cash dividend of $0.21 per share for the three months ended March 31, 2021. The dividend will be paid on June 1, 2021 to shareholders of record as of May 18, 2021. The dividend payment is subject to withholding tax of 20%.

The Company reiterates its expectation for 2021 revenue and Adjusted EBITDA to be higher year-over-year. The company anticipates revenue to grow faster than EBITDA in 2021 mainly due to higher shipping and raw material costs, coupled with a return to more normalized levels of sales and marketing expenses and other investments to support the Company’s growth initiatives.

The Company’s outlook includes the investment costs associated with its Global Growth Acceleration Plan. The Company’s outlook also assumes that both pandemic related business restrictions will fade and that the supply environment will improve as the year progresses.