DIT AMCON Distributing Co

AMCON Distributing Company (“AMCON”) (AMEX:DIT), an Omaha, Nebraska based consumer products company is pleased to announce fully diluted earnings per share of $2.32 for the first fiscal quarter ended December 31, 2009.

“This was a very solid quarter as both of our business segments performed well. Additionally, our recently announced acquisition in Northwest Arkansas is meeting our expectations,” said Christopher H. Atayan AMCON’s Chairman and Chief Executive Officer. “Our pursuit of superior customer service is the foundation of our focused business strategy. In a difficult economy, we believe that our management emphasis on fundamentals serves both our customers and shareholders well. We were particularly pleased that we were able to maintain deliveries during the recent spate of severe weather.”

AMCON’s wholesale distribution business reported revenues of $235.0 million and operating income before depreciation and amortization of $4.3 million in the first quarter of fiscal 2010. AMCON’s retail health food business reported revenues of $8.9 million and operating income before depreciation and amortization of $1.0 million for the same period.

Kathleen M. Evans, President of AMCON’s wholesale distribution business commented, “We have carefully integrated our Northwest Arkansas acquisition into the AMCON system. The most immediate impact of this effort is the bottom line benefits our new customers have enjoyed with the length and breadth of our product mix including food service.”

Eric Hinkefent, President of AMCON’s retail health food business commented, “We are diligently working on our new store opening in Tulsa. Overall market conditions continue to be challenging. Our strategy of providing a broad selection of products at an attractive price has developed considerable customer loyalty which drove our performance this quarter.”

“Our stockholders’ equity grew to $25.7 million during the period. Moreover, we continue to maintain high levels of liquidity, which enabled us to develop profitable opportunities for our customers. The recent acquisition in Northwest Arkansas also contributed positively to our overall net income during the quarter,” said Andrew C. Plummer, AMCON’s Chief Financial Officer.

AMCON is a leading wholesale distributor of consumer products, including beverages, candy, tobacco, groceries, food service, frozen and chilled foods, and health and beauty care products with locations in Arkansas, Illinois, Missouri, Nebraska, North Dakota and South Dakota. Chamberlin's Natural Foods, Inc. and Health Food Associates, Inc., both wholly-owned subsidiaries of The Healthy Edge, Inc., operate health and natural product retail stores in central Florida (6), Kansas, Missouri, Nebraska and Oklahoma (4). The retail stores operate under the names Chamberlin's Market & Cafe www.chamberlins.com and Akins Natural Foods Market www.akins.com.

This news release contains forward-looking statements that are subject to risks and uncertainties and which reflect management's current beliefs and estimates of future economic circumstances, industry conditions, Company performance and financial results. A number of factors could affect the future results of the Company and could cause those results to differ materially from those expressed in the Company's forward-looking statements including, without limitation, availability of sufficient cash resources to conduct its business and meet its capital expenditures needs. Moreover, past financial performance should not be considered a reliable indicator of future performance. Accordingly, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all such forward-looking statements.

Visit AMCON Distributing Company's web site at: www.amcon.com

AMCON Distributing Company and Subsidiaries Condensed Consolidated Balance Sheets December 31, 2009 and September 30, 2009   December 2009   September (Unaudited) 2009   ASSETS Current assets: Cash $ 517,964 $ 309,914 Accounts receivable, less allowance for doubtful accounts of $0.9 million at December 2009 and September 2009 23,681,183 28,393,198 Inventories, net 32,948,314 34,486,027 Deferred income taxes 1,703,413 1,701,568 Prepaid and other current assets   4,407,930   1,728,576 Total current assets 63,258,804 66,619,283   Property and equipment, net 11,642,259 11,256,627 Goodwill 6,149,168 5,848,808 Other intangible assets 4,959,519 3,373,269 Other assets   1,025,876   1,026,395 $ 87,035,626 $ 88,124,382 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 13,914,745 $ 15,222,689 Accrued expenses 5,895,614 6,768,924 Accrued wages, salaries and bonuses 2,003,255 3,257,832 Income taxes payable 904,099 3,984,258 Current maturities of credit facility 127,067 177,867 Current maturities of long-term debt   995,327   1,470,445 Total current liabilities 23,840,107 30,882,015   Credit facility, less current maturities 25,476,512 22,655,861 Deferred income taxes 1,268,662 1,256,713 Long-term debt, less current maturities 5,858,402 5,066,185 Other long-term liabilities 440,420 -     Series A cumulative, convertible preferred stock, $.01 par value 100,000 shares authorized and issued, liquidation preference $25.00 per share 2,500,000 2,500,000   Series B cumulative, convertible preferred stock, $.01 par value 80,000 shares authorized and issued, liquidation preference $25.00 per share 2,000,000 2,000,000   Shareholders' equity: Preferred stock, $0.01 par, 1,000,000 shares authorized, 180,000 shares outstanding and issued in Series A and B referred to above - - Common stock, $.01 par value, 3,000,000 shares authorized, 575,439 shares outstanding at December 2009 and 573,232 shares outstanding at September 2009 5,754 5,732 Additional paid-in capital 7,954,295 7,617,494 Retained earnings   17,691,474   16,140,382 Total shareholders' equity   25,651,523   23,763,608 $ 87,035,626 $ 88,124,382   AMCON Distributing Company and Subsidiaries Condensed Consolidated Unaudited Statements of Operations for the three months ended December 31, 2009 and 2008   2009   2008   Sales (including excise taxes of $81.6 million and $50.3 million, respectively $ 243,941,038 $ 217,377,363   Cost of sales   226,713,025     201,532,714   Gross profit   17,228,013     15,844,649     Selling, general and administrative expenses 13,778,739 12,797,583 Depreciation and amortization   387,269     310,334     14,166,008     13,107,917   Operating income   3,062,005     2,736,732   Other expense (income): Interest expense 405,245 489,199 Other (income), net   (13,380 )   (14,067 )   391,865     475,132   Income from continuing operations before income taxes 2,670,140 2,261,600 Income tax expense   941,000     860,000   Income from continuing operations   1,729,140     1,401,600   Loss from discontinued operations, net of income tax benefit of $0.1 million   -     (102,038 ) Net income 1,729,140 1,299,562   Preferred stock dividend requirements   (74,867 )   (105,533 ) Net income available to common shareholders $ 1,654,273   $ 1,194,029   Basic earnings (loss) per share available to common shareholders: Continuing operations $ 2.95 $ 2.38 Discontinued operations   -     (0.19 ) Net basic earnings per share available to common shareholders $ 2.95   $ 2.19   Diluted earnings (loss) per share available to common shareholders: Continuing operations $ 2.32 $ 1.64 Discontinued operations   -     (0.12 ) Net diluted earnings per share available to common shareholders $ 2.32   $ 1.52   Weighted average shares outstanding: Basic 560,119 545,593 Diluted 745,223 856,052   AMCON Distributing Company and Subsidiaries Condensed Consolidated Unaudited Statements of Cash Flows for the three months ended December 31, 2009 and 2008   2009   2008 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 1,729,140 $ 1,299,562 Deduct: Loss from discontinued operations, net of tax   -     (102,038 ) Income from continuing operations 1,729,140 1,401,600   Adjustments to reconcile net income from continuing operations to net cash flows from operating activities: Depreciation 338,099 310,334 Amortization 49,170 - Gain on sale of property and equipment (16,935 ) (43,697 ) Stock based compensation 163,364 132,900 Net excess tax (benefit) deficiency on equity-based awards (107,048 ) 16,592 Deferred income taxes 10,104 47,411 Provision for losses on doubtful accounts 16,426 77,006 Provision for losses on inventory obsolescence 76,703 92,790 Changes in assets and liabilities, net of effect of acquisition: Accounts receivable 4,695,589 3,791,365 Inventories 3,442,508 1,733,268 Prepaid and other current assets (2,679,354 ) 833,568 Other assets 519 (351,942 ) Accounts payable (1,329,456 ) 1,023,735 Accrued expenses and accrued wages, salaries and bonuses (2,127,887 ) (1,321,463 ) Income tax payable   (2,973,111 )   572,219   Net cash flows from operating activities - continuing operations 1,287,831 8,315,686 Net cash flows from operating activities - discontinued operations   -     19,727   Net cash flows from operating activities 1,287,831 8,335,413   CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (596,612 ) (265,971 ) Proceeds from sales of property and equipment 34,306 71,900 Acquisition   (3,099,836 )   -   Net cash flows from investing activities (3,662,142 ) (194,071 )   CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings (payments) on bank credit agreement 2,769,851 (7,866,594 ) Principal payments on long-term debt (182,901 ) (197,731 ) Proceeds from exercise of stock options 66,411 - Net excess tax benefit (deficiency) on equity-based awards 107,048 (16,592 ) Dividends paid on preferred stock (74,867 ) (105,533 ) Dividends on common stock   (103,181 )   (57,039 ) Net cash flows from financing activities   2,582,361     (8,243,489 ) Net change in cash 208,050 (102,147 )   Cash, beginning of period   309,914     457,681   Cash, end of period $ 517,964   $ 355,534      

2009

2008

Supplemental disclosure of cash flow information: Cash paid during the period for interest $ 381,746 $ 544,238 Cash paid during the period for income taxes 3,903,998 182,371   Supplemental disclosure of non-cash information:   Equipment acquisitions classified as accounts payable 21,512 -   Business acquisition Inventory 1,981,498 - Property and equipment 122,978 - Customer relationships intangible asset 1,620,000 - Goodwill 300,360 - Note payable 500,000 - Contingent consideration 425,000 -