- Comparable sales down 1.3% (total sales down 4.9%)
- Stable comparable sales in the Distribution segment despite
the negative impact of external factors
- Cash flows from operations of $11.9
million, reflecting sound management of working
capital
- Optimized capital structure following the refinancing of its
credit facilities announced January 31,
2014
BOUCHERVILLE,
QC, May 1, 2014 /CNW Telbec/ -
Colabor Group Inc. (TSX: GCL) ("Colabor" or the "Company") today
reported results for the first quarter of fiscal 2014 ended
March 22, 2014.
"As expected, first-quarter results were
affected by winter weather considerably more severe than last year
and by a slow economy, mainly in Quebec. These external factors led to reduced
traffic in restaurants, which limited Colabor sales to the
foodservice industry, as well as to higher delivery costs. The
decrease in volume had a marked effect on operating profitability
and offset the benefits of measures taken under our action plan
which, notably, resulted in lower warehousing costs," said Claude
Gariépy, President and Chief Executive Officer of Colabor.
|
|
Financial highlights |
Quarters ended |
(thousands
of dollars except per-share data) |
March 22, 2014 |
|
March 23,
2013 |
Sales |
279,318 |
|
293,580 |
EBITDA |
148 |
|
2,309 |
Charges not related to current
operations |
- |
|
247 |
Net earnings |
(5,566) |
|
(3,358) |
|
Per share - basic ($) |
(0.21) |
|
(0.14) |
Cash flow from operations |
11,947 |
|
(25,789) |
Weighted
average number of shares outstanding (basic, in thousands) |
27,062 |
|
24,058
|
FIRST-QUARTER RESULTS
Consolidated sales for the 81-day period ended March 22, 2014 were $279.3 million, compared to $293.6 million for the 82-day period ended
March 23, 2013. The 4.9%
decrease is attributable to the residual effects of the end of a
large supply contract in Ontario
in April 2013 and to the termination
of unprofitable distribution of tobacco products beginning in the
second quarter of 2013. In addition, harsher winter weather in the
first quarter of 2014 relative to a year earlier affected the
Company's sales to the foodservice industry by reducing traffic in
restaurants. On the other hand, the acquisition of T. Lauzon Ltée
("Lauzon") contributed to sales for the entire quarter in 2014
compared to only 20 days in the first quarter of 2013.
Excluding the above factors, and on the basis of
an equal number of days, comparable sales were down 1.3%.
Comparable sales were stable in the Distribution segment, where an
increase in the sales of Norref and higher sales in Ontario were offset by the negative impact of
external factors in eastern Quebec. For the Wholesale segment, comparable
sales were down 4.1%.
Earnings before financial expenses, income
taxes, depreciation and amortization ("EBITDA") were $148,000, compared to $2.3 million in the first quarter of 2013.
The decrease was due to the effect of lower sales volume on the
absorption of fixed operating costs, to the end of the supply
contract in Ontario and to the
effect of higher commodity prices on the profitability of Lauzon
operations. Consequently the Company recorded a net loss for the
quarter of $5.6 million compared to a
net loss of $3.4 million a year
earlier.
CASH FLOWS AND FINANCIAL POSITION
Cash flows from operations were $11.9
million in the first quarter of 2014, compared to a negative
$25.8 million in the first quarter of
2013. The substantial and sustainable improvement reflects sound
management of working capital, which generated funds of
$12.2 million during the quarter due
to the seasonal nature of operations.
This source of liquidity allowed the Company to
reduce the amount drawn on its bank credit facility. As at
March 22, 2014, that amount was
$87.4 million, down from $108.7 million at the end of the previous
quarter. Average daily indebtedness in the first quarter of 2014
was $96 million, down from
$128 million in the first quarter of
2013 and from $102 million in the
fourth quarter of 2013.
REFINANCING OF CREDIT FACILITIES
Colabor announced on January 31, the
refinancing of its credit facilities and entered into a long-term
loan of $42.5 million, of which
$15 million was used to repay
existing debt.
The implementation of the refinancing allows Colabor to improve
operational flexibility because it has no more leverage ratio
constraint to respect and a greater availability in cash.
DECLARATION OF A QUARTERLY DIVIDEND OF
$0.06 PER SHARE
The Board of Directors of the Company has declared a cash dividend
of $0.06 per share, to be paid
June 16, 2014 to shareholders of
record as of the close of business May 30, 2014. This dividend constitutes an
eligible dividend under subsection 89(14) of the Income Tax
Act.
OUTLOOK
"Colabor has taken major measures to improve its efficiency and
grow its sales. Although we have no control over external factors,
we continue to put in place new operating processes that will bring
us further cost savings over the coming quarters. We are ready to
reap returns from increases in volume, which will have a direct
effect on operating profitability," concluded Mr. Gariépy.
CONFERENCE CALL
Colabor will hold a conference call to discuss these results on
Thursday, May 1, 2014, beginning at
3 p.m. Eastern Time. Interested
parties can join the call by dialling 647-427-7450 (from
Toronto and overseas) or
1-888-231-8191 (from elsewhere in North
America). If you are unable to participate, you can listen
to a recording by dialling 1-855-859-2056 and entering the code
30548315 on your telephone keypad. The recording will be available
from 6 p.m. on Thursday, May 1, 2014 to 11:59 p.m. on Thursday,
May 8, 2014.
NON-IFRS MEASURES
The information provided in this release includes non-IFRS
performance measures, notably earnings before financial expenses,
income taxes, depreciation and amortization (EBITDA) and cash flow.
Since these concepts are not defined by IFRS, they may not be
comparable to those of other companies.
ADDITIONAL INFORMATION
The Management Discussion and Analysis and the financial
statements of the Company will be available at SEDAR
(www.sedar.com) following publication of this release. Additional
information about Colabor Group Inc. may also be found at SEDAR and
on the Company's website at www.colabor.com.
FORWARD-LOOKING STATEMENTS
This news release may contain forward-looking statements reflecting
the opinions or current expectations of Colabor Group Inc.
concerning its performance and business operations and future
events. These statements are subject to risks, uncertainties and
assumptions. Actual results or events may differ.
ABOUT COLABOR
Colabor is a wholesaler and distributor of food and non-food
products serving the foodservice market (cafeterias, restaurants,
hotels, restaurant chains) and the retail market (grocery stores,
convenience stores, etc.), in Quebec, Ontario and the Atlantic provinces.
SOURCE Colabor