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WATSCO, INC. NET EARNINGS FROM OPERATIONS UP 76 PERCENT FLORIDA MARKET STRENGTHENS AS NEW ACQUISITION CONTRIBUTES

 MIAMI, July 21 /PRNewswire/ -- Watsco, Inc. (AMEX: WSOA, WSOB), the nation's largest independent distributor of residential central air conditioners and a leading manufacturer of climate control parts and components, announced today that second quarter 1993 revenues, net income, and earnings per share reached record levels.
 Excluding income from the proceeds of business interruption insurance related to 1992's Hurricane Andrew, net income from operations increased 76 percent to $1.51 million and net earnings per share increased 28 percent to $.37 on a fully diluted basis ($.38 primary). The insurance proceeds contributed an additional $706,000 to net income ($1.13 million pre-tax) and $.16 to fully diluted earnings per share ($.18 primary). Second quarter revenues increased 20 percent to $59.5 million. In total, second quarter net income increased 168 percent to $2.21 million, and earnings per share increased 83 percent to $.53 on a fully diluted basis ($.56 primary).
 For the six months ended June 30, 1993, excluding the insurance proceeds, revenues increased 15 percent to $98.2 million, net income from operations increased 94 percent to $1.85 million, and earnings per share increased 37 percent to $.48 on a fully diluted basis ($.50 primary).
 Watsco President and Chief Executive Officer, Albert H. Nahmad, said: "Despite very weak conditions in several of our key markets, we were able to continue our double-digit growth. We made significant progress during the second quarter in implementing our market share expansion strategy through both acquisitions and internal growth."
 In the company's air conditioner distribution business, the Texas operation Watsco acquired in May 1993 made a substantial contribution to second quarter growth. The acquisition provided Watsco with 11 distribution centers in the largest residential central air conditioner market in the country, and one of the few where new homebuilding has begun to recover from the depressed levels of recent years.
 Watsco continued to build its share of the California distribution market, both through the June 1993 acquisition of four distribution centers in central California as well as through internal market share growth. While Watsco's sales are down 14 percent in the depressed California market, the Company's market share gains should provide upside leverage when the California economy recovers. The newly acquired central California branches are expected to benefit from steps Watsco is taking to improve the weak operations and should contribute positive results in mid-1994.
 Internal growth was strongest in Watsco's Florida distribution operations, where revenues increased by 12 percent. The growth is attributable in part to rebuilding the destruction from 1992's Hurricane Andrew, as well as to general improvement in the Florida economy in recent months.
 In the company's parts and components manufacturing business, results were negatively impacted by a 59 percent decline in shipments of Watsco's refrigerant recovery system (the "Flash"). Sales of the Flash were very strong in last year's second quarter as customers raced to meet the July 1, 1992 deadline prohibiting venting of chloroflourocarbons (CFCs) mandated by the Federal Clean Air Act of 1990. However, sales fell sharply thereafter due to lack of enforcement. Signs of Environmental Protection Agency enforcement are beginning to appear. Watsco believes that with one of the most accepted CFC recovery and recycling products in the field and one of the few national distribution systems, the company will be a primary beneficiary of increased compliance. Declines in environmental equipment sales were partially offset by continued rapid growth of parts and components sold to original equipment manufacturers (OEMs).
 Mr. Nahmad said: "The strong increase in revenues and earnings continues to confirm our Sunbelt distribution expansion strategy in a soft economy by focusing on replacement sales and market share gains. When new homebuilding begins to recover in more of our key markets, we believe we will be in an excellent position to expand our strong growth."
 Watsco, Inc., an emerging growth company, is the nation's largest independent distributor of residential central air conditioners and a leading manufacturer of products for climate control, environmental protection and energy conservation. Revenues have grown from $15 million in 1987 to an annual rate of approximately $250 million in 1993.
 WATSCO, INC.
 Results of Operations
 Three Months Ended Percent
 June 30, 1993 1992 Change
 Revenues ($000) $59,546 $49,822 +20
 Net Income ($000)
 Operations 1,510 858 +76
 Insurance Proceeds 706 --
 Total Net Income 2,216 858 +158
 Primary Earnings Per Share
 Operations .38 .32 +19
 Insurance Proceeds .18 --
 Total Net Income .56 .32 +75
 Fully Diluted Earnings Per Share
 Operations .37 .29 +28
 Insurance Proceeds .16 --
 Total Net Income .53 .29 +83
 Shares used for Earnings
 Per Share:
 Primary 3,950,695 2,677,561 +48
 Fully Diluted 4,333,463 3,234,520 +34
 Six Months Ended Percent
 June 30, 1993 1992 Change
 Revenues ($000) $98,198 $85,448 +15
 Net Income ($000)
 Operations 1,853 956 +94
 Insurance Proceeds 706 --
 Total Net Income 2,559 956 +168
 Primary Earnings Per Share
 Operations .50 .36 +39
 Insurance Proceeds .19 --
 Total Net Income .69 .36 +92
 Fully Diluted Earnings Per Share
 Operations .48 .35 +37
 Insurance Proceeds .17 --
 Total Net Income .65 .35 +86
 Shares used for Earnings
 Per Share:
 Primary 3,697,650 2,620,073 +41
 Fully Diluted 4,162,122 3,182,781 +31
 -0- 7/21/93
 /CONTACT: Ronald P. Newman of Watsco, Inc., 305-858-1204, or William J. Jenks of Broadgate Consultants, Inc., 212-229-2222, for Watsco, Inc./
 (WSO)


CO: Watsco, Inc. ST: Florida IN: SU: ERN

LD -- NY004 -- 3741 07/21/93 08:13 EDT
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Date:Jul 21, 1993
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