Strong Fourth Quarter Drives Zep

Zep Inc. said revenue for the fourth quarter ended Aug. 31 rose 20.2% to $161.4 million and revenue for fiscal 2010 increased 13.5% to $568.5 million, up from $501 million in fiscal 2009.

Fourth quarter fiscal 2010 adjusted net income was $7.4 million compared with $6.6 million in the fourth quarter of fiscal 2009. Zep’s fiscal 2010 adjusted net income was $21.8 million compared with $11.3 million in fiscal 2009.

John K. Morgan, chairman, president and chief executive officer of Zep addressed the company’s trio of acquisitions in the last nine months. “The first was Amrep, which was immediately accretive to earnings, expands our access to the retail and distributor channels, and provides significant private label capabilities. We recently completed our acquisition of certain brands and assets of Waterbury Companies, which we expect will enhance Amrep’s leading position as a provider of air care delivery systems and products for facilities maintenance. Our third acquisition, while much smaller than the first two, included the assets of Niagara National and complements our strength in our vehicle wash business, specifically in the high quality truck and fleet washing equipment markets.”

In addition to Zep’s fiscal 2010 acquisition initiatives, the company increased investment spending within its legacy businesses to drive organic growth, according to Mogran. “We believe our ability to generate consistently strong cash flow coupled with an expanded credit facility will allow us to pursue both organic and acquisitive growth opportunities in the years ahead,” he said.