Uni-Sélect Inc.
TSX : UNS

Uni-Sélect Inc.

August 05, 2009 12:30 ET

Uni-Select Inc.: Sales Up 21% and Net Income Up 22% for the Second Quarter of 2009

BOUCHERVILLE, QUEBEC--(Marketwire - Aug. 5, 2009) - Uni-Select Inc. (TSX:UNS) reported sales from continuing operations of $384,161,000 for the second quarter of 2009, up 20.9% over sales of $317,685,000 for the same period of 2008. The Company's sales increase is due mainly to acquisitions conducted in the previous quarters and to the currency variation. Net income from continuing operations reached $16,029,000 or $0.81 per share, for the second quarter, compared with $13,179,000 or $0.67 per share, for the corresponding quarter last year. Net income, including results from discontinued activities, totalled $15,408,000 or $0.78 per share, compared with $12,689,000 or $0.64 per share last year. Excluding the impact of the exchange rate variation, sales would have risen 12.8% and net income would have been $0.74 a share for the quarter, an increase of 15.6%.

For the first half of 2009, sales for continuing activities reached $735,005,000 an increase of $148,636,000 or 25.3%, compared with the same period in 2008. Earnings from continuing activities stood at $25,023,000 or $1.27 per share, compared with $20,083,000 or $1.02 per share for the first half of 2008.



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2ND QUARTER 1ST HALF
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(in millions, except net
earnings per share) 2009 2008 2009 2008
--------------------------------------------------------------------------
Sales 384.2 317.7 735.0 586.4
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Earnings from
continuing activities 16.0 13.2 25.0 20.1
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Earnings per share from
continuing activities 0.81 0.67 1.27 1.02
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Net earnings per share 0.78 0.64 1.19 0.95
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Second-quarter sales for Automotive Group USA reached $241,541,000 compared with $168,181,000 for the second quarter of 2008. The acquisitions completed in recent quarters contributed $51,571,000 to higher sales in the quarter, to which should be added the favorable impact of the exchange rate variation. Excluding the items mentioned above, organic growth was neutral in the second quarter. The operating margin for the Group remained stable at 7.1%. However, on a comparative basis, excluding the impact of the latest acquisitions whose integration is at an early stage, the operating margin was 7.6%, up 0.4% over 2008 due to the effects of continuous improvement programs on margins and costs. For the first six months of 2009, sales were $474,477,000 a 49.2% increase over the same period in 2008. The operating margin, excluding the recent acquisitions, showed improvement, going from 6.7% to 7.1% in 2009.

Automotive Group Canada experienced organic sales growth of 0.1% in the second quarter of 2009, offset by the effect of the disposal of 10 stores earlier in the quarter. The Group's sales stood at $142,620,000 compared to $149,504,000 in the same period of 2008. The Group's operating margin reached 10.1%, up from 8.7% in the second quarter of last year. For the first half of 2009, sales were $260,528,000, down 2.9% from the same period in 2008. For purposes of comparison, excluding the store disposals mentioned above, the decline was 0.3%. The operating margin stood at 8.6% in the first half compared to 7.2% in 2008.

"In addition to our financial performance for the quarter, we are pleased with the results of our various operational and strategic initiatives," said Richard G. Roy, President and Chief Executive Officer of Uni-Select. "Recent acquisitions have contributed broadly to improving our quarterly results. Our cost improvement program instituted in 2008 that includes integration and reorganization initiatives , , should increase our margins and earnings in the second half of 2009." Mr. Roy continued: "Optimization of our assets led to the sale of 10 stores in Canada, the closing of several stores in the United States, an orderly reduction in inventories, and the sale of the assets of the Heavy Duty division. This last measure is part of our strategic plan as we intend to focus our efforts on the distribution of replacement parts for light vehicles. The orderly reduction in the asset base will continue throughout the second half of the calendar year. We shall remain expedient and alert in looking for opportunities that would enable us to grow both in Canada and in the United States."

In closing, the Board of Directors of Uni-Select Inc. declared a quarterly dividend of $0.1165 per common share payable on October 20, 2009, to shareholders of record as at September 30, 2009.

Unless indicated otherwise, all figures in this release are in Canadian dollars.

Uni-Select is a Canadian leader in the distribution of automotive replacement parts, equipment, tools and accessories. Through its subsidiary Uni-Select USA, Inc., the Company also operates in the United States, where it is the seventh largest distributor. The Uni-Select NetworkTM includes over 2,500 independent jobbers and services 3,500 points of sale in Canada and the United States. Uni-Select is headquartered in Montreal. Uni-Select shares (UNS) are traded on the Toronto Stock Exchange.

Certain statements made in this news release contain forward-looking statements which, by their very nature, include risks and uncertainties, such that actual results could differ from those indicated in those forward-looking statements. For additional information with respect to the risks and uncertainties, refer to the Annual Report filed with Canadian securities commissions by Uni-Select. Unless required to do so pursuant to applicable securities legislation, Uni-Select assumes no obligation as to the updating or revision of the forward-looking statements as a result of new information, future events or other changes.



CONSOLIDATED EARNINGS
THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2009 AND 2008
(in thousands of dollars, except earnings per share, unaudited)


2nd QUARTER 6 MONTHS
2009 2008 2009 2008
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$ $ $ $

SALES 384,161 317,685 735,005 586,369
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Earnings before the
following items 31,618 25,017 52,327 40,662
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Interest (Note 3) 2,150 1,486 4,443 3,290
Amortization (Note 3) 3,331 2,607 7,121 5,231
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5,481 4,093 11,564 8,521
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Earnings before income
taxes and non-controlling
interest 26,137 20,924 40,763 32,141
Income taxes
Current 5,363 6,938 13,504 10,177
Future 3,665 (104) 185 291
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9,028 6,834 13,689 10,468
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Earnings before
non-controlling interest 17,109 14,090 27,074 21,673
Non-controlling interest 1,080 911 2,051 1,590
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Earnings from continuing
operations 16,029 13,179 25,023 20,083
Loss related to
discontinued operations
(Note 15) (621) (490) (1,602) (1,333)
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Net earnings 15,408 12,689 23,421 18,750
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Basic earnings and diluted
earnings per share (Note 4)
From continuing
operations 0.81 0.67 1.27 1.02
From discontinued
operations (0.03) (0.03) (0.08) (0.07)
Net income 0.78 0.64 1.19 0.95
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Weighted average
number of outstanding
shares 19,711,550 19,731,769 19,704,677 19,734,163
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Number of issued and
outstanding shares 19,714,128 19,727,958 19,714,128 19,727,958
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The accompanying notes are an integral part of the interim consolidated
financial statements.




CONSOLIDATED RETAINED EARNINGS
THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2009 AND 2008
(in thousands of dollars, unaudited)

6 MONTHS
2009 2008
--------------------------------------------------------------------------
$ $
Balance, beginning of period 324,241 287,712
Net earnings 23,421 18,750
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347,662 306,462
Redemption of common shares (a) - 176
Dividends 4,592 4,243
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Balance, end of period 343,070 302,043
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(a) In 2008, the Company redeemed 8,600 common shares for a cash
consideration of $197 including a share redemption premium of $176.




CONSOLIDATED COMPREHENSIVE INCOME
THREE-MONTH AND SIX-MONTHS PERIODS ENDED JUNE 30, 2009 AND 2008
(in thousands of dollars, unaudited)

2nd QUARTER 6 MONTHS
2009 2008 2009 2008
--------------------------------------------------------------------------
--------------------------------------------------------------------------
$ $ $ $
Net earnings 15,408 12,689 23,421 18,750
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Other comprehensive income:

Unrealized gain (losses)
on derivative financial
instruments designated
as cash flow hedges,
net of income taxes of
($670) and ($384) for the
three-month and the
six-month periods
respectively (($653)
and $6 in 2008) 1,329 1,401 715 (13)

Reclassification of
realized losses to
net earnings on
derivative financial
instruments designated
as cash flow hedges,
net of income taxes of
($293) and ($512) for
the three-month
and the six-month periods
respectively (($46)
and ($67) in 2008) 642 99 1,113 145

Unrealized gains on
translation of bank
indebtedness incurred in
2008 and designated as a
hedge of net investments
in self-sustaining foreign
subsidiairies 1,622 - 1,031 -

Unrealized gains (losses)
on translating financial
statements of self
sustaining foreign
operations (18,426) (1,261) (12,161) 4,569
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Other comprehensive
income (14,833) 239 (9,302) 4,701
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Comprehensive income 575 12,928 14,119 23,451
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The accompanying notes are an integral part of the interim consolidated
financial statements.




CONSOLIDATED CASH FLOWS
THREE-MONTH AND SIX-MONTHS PERIODS ENDED JUNE 30, 2009 AND 2008
(in thousands of dollars, except dividends paid per share, unaudited)

2nd QUARTER 6 MONTHS
2009 2008 2009 2008
--------------------------------------------------------------------------
--------------------------------------------------------------------------
$ $ $ $

OPERATING ACTIVITIES
Net earnings 15,408 12,689 23,421 18,750
Non-cash items
Amortization 3,398 2,679 7,255 5,375
Amortization of
deferred gain on a
sale-leaseback
arrangement (55) (54) (122) (108)
Future income taxes 3,665 (104) 185 291
Non-controlling interest 1,080 911 2,051 1,590
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23,496 16,121 32,790 25,898

Changes in working
capital items (4,442) 12,839 (28,468) 2,917
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CASH FLOWS FROM
OPERATING ACTIVITIES 19,054 28,960 4,322 28,815
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INVESTING ACTIVITIES
Business acquisitions
(Note 5) - (11,228) (668) (29,625)
Disposal of assets
(Note 6) 849 - 849 -
Non-controlling interest (159) - (196) -
Investments and advances
to merchant members (6,008) (1,649) (6,379) (2,338)
Receipts on advances
to merchant members 1,026 1,766 2,274 2,331
Fixed assets (6,212) (3,798) (10,160) (6,166)
Disposal of fixed assets 431 125 431 176
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CASH FLOWS FROM
INVESTING ACTIVITIES (10,073) (14,784) (13,849) (35,622)
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FINANCING ACTIVITIES
Bank indebtedness (5,933) (25,252) 6,184 (1,257)
Balance of purchase price (802) 337 (685) -
Financing costs - - - (414)
Long-term debt - 13,617 - 13,628
Repayment of long-term debt (143) (907) (1,499) (972)
Merchant members' deposits
in guarantee fund 121 167 182 161
Issuance of shares - - 202 -
Share redemption - (197) - (197)
Dividends paid (2,295) (2,121) (4,413) (4,243)
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CASH FLOWS FROM
FINANCING ACTIVITIES (9,052) (14,356) (29) 6,706
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Decrease in cash and
cash equivalents (71) (180) (9,556) (101)
Cash and cash equivalents,
beginning of period 197 678 9,682 599
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Cash and cash equivalents,
end of period 126 498 126 498
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Dividends paid per share 0.117 0.108 0.225 0.215
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The accompanying notes are an integral part of the interim consolidated
financial statements.




CONSOLIDATED BALANCE SHEETS
JUNE 30, 2009 AND 2008
(in thousands of dollars, unaudited)

JUNE 30 JUNE 30 DECEMBER 31
2009 2008 2008
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--------------------------------------------------------------------------
Audited
$ $ $

ASSETS
CURRENT ASSETS
Cash and cash equivalents 126 498 9,682
Accounts receivable 190,359 170,067 180,308
Income taxes receivable 1,127 8,313 9,051
Inventory (Note 7) 432,666 367,136 482,340
Prepaid expenses 5,787 6,487 6,742
Future income taxes 9,006 8,756 10,172
Assets related to discontinued
operations (Note 15) 32,920 - -
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671,991 561,257 698,295
Investments and advances
to merchant members 16,690 7,230 8,710
Fixed assets 55,189 44,187 54,939
Financing costs 619 795 785
Intangible assets 7,523 261 8,147
Derivative financial instrument - 193 -
Goodwill 97,996 73,878 99,501
Future income taxes 3,955 2,711 3,707
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853,963 690,512 874,084
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LIABILITIES
CURRENT LIABILITIES
Bank indebtedness (Note 8) 4,638 35,611 -
Accounts payable 186,231 170,064 212,581
Dividends payable 2,297 2,122 2,118
Instalments on long-term debt
and on merchant members' deposits
in guarantee fund 148 45 327
Future income taxes 5,208 61 5,676
Liabilities related to
discontinued operations (Note 15) 7,170 - -
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205,692 207,903 220,702
Deferred gain on a sale-leaseback
arrangement 2,384 2,302 2,641
Long-term debt 197,866 107,830 209,907
Merchant members' deposits in
guarantee fund 8,082 7,773 7,724
Derivative financial instruments 5,897 - 8,620
Future income taxes 5,209 3,951 5,013
Non-controlling interest 46,339 37,170 46,776
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471,469 366,929 501,383
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SHAREHOLDERS' EQUITY
Capital stock 50,040 49,850 49,838
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Contributed surplus 291 - 227
Retained earnings 343,070 302,043 324,241
Accumulated other comprehensive
income (Note 9) (10,907) (28,310) (1,605)
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332,454 273,733 322,863
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382,494 323,583 372,701
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853,963 690,512 874,084
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The accompanying notes are an integral part of the interim consolidated
financial statements.


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2009 AND 2008

(in thousands of dollars, except for per share amounts, unaudited)

1. BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements are prepared in accordance with Canadian generally accepted accounting principles for interim financial statements and do not include all disclosures required for complete financial statements. They are also consistent with the accounting policies outlined in the audited financial statements of the Company for the year ended December 31, 2008. The interim financial statements and related notes should be read in conjunction with the audited financial statements of the Company for the year ended December 31, 2008. When necessary, the financial statements include amounts based on informed estimates and the best judgment of management. The operating results for the interim periods reported are not necessarily indicative of results to be expected for the year.

2. CHANGES IN ACCOUNTING POLICIES

Goodwill and intangible assets

On January 1, 2009, in accordance with the applicable transitional provisions, the Company adopted the new recommendations of the CICA Handbook included in Section 3064, "Goodwill and intangible assets". This Section establishes standards for the recognition, measurement and disclosure of goodwill and intangible assets, after the initial recognition. The adoption of these recommendations did not have significant impact on the consolidated financial statements.

Credit risk and fair value of financial assets and financial liabilities

On January 1, 2009, the Company adopted the recommendations of EIC-173 of the CICA Handbook, Credit risk and fair value of financial assets and financial liabilities. This abstract notes that the credit risk specific to the entity and the credit risk of the counterparty should be taken into account in determining the fair value of financial assets and financial liabilities, including derivatives.

The adoption of these recommendations was applied retrospectively without restatement of consolidated financial statements of prior periods. On January 1, 2009, taking into account credit risk in the evaluation of derivative financial instruments did not have significant effect on consolidated results.

3. INFORMATION INCLUDED IN THE CONSOLIDATED EARNINGS



2nd QUARTER 6 MONTHS
Other financial liabilities 2009 2008 2009 2008
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$ $ $ $
Interest on bank
indebtedness 148 594 472 1,325
Interest on long-term debt 2,062 964 4,106 2,078
Interest on merchant
members' deposits in
guarantee fund 43 98 110 182
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2,253 1,656 4,688 3,585

Held-for-trading
financial assets
Interest income on cash
and cash equivalents (1) (11) (5) (21)
Loans and receivables
Interest income from
merchant members (102) (159) (240) (274)
--------------------------------------------------------------------------
(103) (170) (245) (295)
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2,150 1,486 4,443 3,290
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Amortization
--------------------------------------------------------------------------
Amortization of
fixed assets 3,123 2,514 6,686 5,034
Amortization of
other assets 208 93 435 197
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3,331 2,607 7,121 5,231
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4. EARNINGS PER SHARE

Weighted average number of shares for the calculation of basic earnings per share is 19,711,550 for the three-month period ended June 30, 2009 (19,731,769 in 2008) and 19,704,677 for the six-month period ended June 30, 2009 (19,734,163 in 2008). Impact of stock options exercised is 12,653 shares for the three-month period ended June 30, 2009 (19,568 in 2008) and 15,140 for the six-month period ended June 30, 2009 (21,429 in 2008) which total a weighted average number of shares of 19,724,203 for the three-month period ended June 30, 2009 (19,751,337 in 2008) and 19,719,817 for the six-month period ended June 30, 2009 (19,755,593 in 2008) for calculation of diluted earnings per share.

5. BUSINESS ACQUISITIONS

In 2009, the Company acquired the assets of two companies in the Automotive USA segment.

In addition, the Company increased its interest by 1.92% in its joint venture, Uni-Select Pacific Inc. Following this transaction, the Company's interest in the joint venture increased from 69.23% to 71.15% . This transaction was carried out at the carrying amount as stated in the shareholders' agreement.

The operating results are consolidated in the statement of earnings since the acquisition date.

The preliminary purchase price is allocated as follows:



Total
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$
Current assets 1,211
Fixed assets 153
Goodwill 1,532
Current liabilities (2,190)
Long-term liabilities (11)
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695
Cash of companies acquired 1
Total consideration paid less cash acquired 668
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Balance of purchase price payable 26
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Uni-Select USA Inc.

The Company acquired a non-controlling interest for a cash consideration of $196. Following this transaction, the Company's interest in its U.S. subsidiary increased by 0.05%, from 86.94% to 86.99% .

6. DISPOSAL OF ASSETS

In 2009, the Company sold in several transactions some of the assets of ten stores in the Automotive Canada segment. The assets have been sold for an amount of $4,905 for a cash consideration of $1,298 from which $449 is receivable and a non-cash consideration of $3,607.

7. INVENTORY

Cost of inventory recognized as an expense for the three-month period ended June 30, 2009 is $264,274 ($218,433 in 2008) and $518,373 for the six-month period ended June 30, 2009 ($419,820 in 2008).

8. CREDIT FACILITY

The Company has a credit facility in the amount of $325,000. This credit facility is composed of a $235,000 revolving credit expiring in October 2011. The credit facility also includes a $90,000 operating credit maturing in October 2009 which is also used for the issuance of letters of guarantee and is renewable annually in October. As at June 30, 2009, the issued letters of guarantee totalled $8,219 ($6,515 as at December 31, 2008). This facility can be drawn either in Canadian dollars or U.S. dollars.
The interest rates vary according to the type of loan and the financial ratios achieved by the Company and are set each quarter. As at June 30, 2009, interest rates vary between 1.3% and 3.75% (1.4% and 3.75% as at December 31, 2008).

9. ACCUMULATED OTHER COMPREHENSIVE INCOME



JUNE 30, 2009 DECEMBER 31, 2008
--------------------------------------------------------------------------
$ $
Balance, beginning of period (1,605) (33,011)
Other comprehensive income
for the period (9,302) 31,406
--------------------------------------------------------------------------
Balance, end of period (10,907) (1,605)
--------------------------------------------------------------------------
--------------------------------------------------------------------------


10. EMPLOYEE FUTURE BENEFITS

As at June 30, 2009, the Company's pension plans are defined benefit and contribution plans.

For the three-month period ended June 30, 2009, the total expense for the defined contribution pension plans was $468 ($260 in 2008) and $638 ($601 in 2008) for the defined benefit pension plans.

For the six-month period ended June 30, 2009, the total expense for the defined contribution pension plans was $734 ($517 in 2008) and $1,302 ($1,201 in 2008) for the defined benefit pension plans.

11. GUARANTEES

As per inventory repurchase agreements, the Company has made a commitment to financial institutions to repurchase inventories from some of its customers at a rate of 60% to 75% of the value of inventories for a maximum amount of $61,495 ($65,525 as at December 31, 2008). In the event of proceedings, the inventories would be liquidated in the normal course of the Company's operations. These agreements are for an undetermined period of time. In management's opinion, the likelihood of major payments being made and losses being absorbed is low, since the value of the assets held in guarantee is significantly higher than the Company's commitments.

12. FINANCIAL INSTRUMENTS



Derivative financial instruments
The Company entered into agreements to swap variable interest rates
(Note 8) for a nominal amount of US$ 150,000 for fixed rates.

Maturity
------------------------------------------
Nominal amount Rate 2009 2010 2011 2012 2013
--------------------------------------------------------------------------
US$ US$ US$ US$ US$ US$
30,000 0.73% 30,000
60,000 3.94% 20,000 20,000 20,000
30,000 3.50% 10,000 10,000 10,000
30,000 3.35% 10,000 10,000 10,000


The fair value of the interest rate swaps is calculated using quotes for similar instruments on the balance sheet date obtained by the Company's financial institution and represents an amount payable by the Company of $5,897 ($8,620 as at December 31, 2008).

13. SEGMENTED INFORMATION



--------------------------------------------------------------------------
2nd QUARTER
--------------------------------------------------------------------------
Automotive USA Automotive Canada Consolidated
2009 2008 2009 2008 2009 2008
$ $ $ $ $ $
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Sales 241,541 168,181 142,620 149,504 384,161 317,685
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Earnings before
interests,
amortization,
income taxes and
non controlling
interest 17,199 12,037 14,419 12,980 31,618 25,017
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Assets (1) 578,158 391,102 242,885 264,143 821,043 655,245

Acquisition of
fixed assets(2) 1,807 2,536 4,405 2,087 6,212 4,623

Acquisition of
goodwill 10 199 1,375 552 1,385 751
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6 MONTHS
--------------------------------------------------------------------------
Automotive USA Automotive Canada Consolidated
2009 2008 2009 2008 2009 2008
$ $ $ $ $ $
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Sales 474,477 318,100 260,528 268,269 735,005 586,369
--------------------------------------------------------------------------
Earnings before
interest,
amortization,
income taxes and
non controlling
interest 29,997 21,214 22,330 19,448 52,327 40,662
--------------------------------------------------------------------------
Assets (1) 578,158 391,102 242,885 264,143 821,043 655,245

Acquisition of
fixed assets(2) 3,685 4,025 6,585 3,403 10,270 7,428

Acquisition of
goodwill 10 292 1,522 7,648 1,532 7,940
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(1) The assets in the consolidated balance sheet include an amount of
$32,920 ($35,267 in 2008) related to discontinued operations.

(2) The fixed assets acquisitions in the consolidated cash flows include an
amount related to discontinued operations of $0 and $43 ($61 and $82 in
2008) respectively for the three-month and six-month periods ended June
30th.

The Automotive USA segment includes fixed assets for an amount of
$26,251 ($18,541 as at June 30, 2008) and goodwill for an amount of
$56,864 ($36,081 as at June 30, 2008).


14. FUTURE ACCOUNTING STANDARDS

International Financial Reporting Standards

The Canadian Accounting Standards Board confirmed that the use of International Financial Reporting Standards ("IFRS") established by the International Accounting Standards Board will be required for fiscal years beginning January 1st, 2011 for publicly accountable profit-oriented enterprises. IFRS will replace Canada's current GAAP for those enterprises.

In the second quarter, the Company continued training its resources. It also inventoried the discrepancies between IFRS and Canadian accounting standards as well as the choices that could potentially affect the recording and/or disclosure of certain items. As regards data systems, the Company has ensured that the new system, to be implemented gradually starting in 2010, will provide for parallel accounting based on IFRS and Canadian standards.

In the coming quarters, the Company will conduct a detailed analysis of the discrepancies that arise in initial identification and will quantify them based on the possible choices, also determining the impact on disclosure requirements and the calculation of certain ratios or performance measurements.

Business combinations

In January 2009, the CICA issued Section 1582, Business Combinations, which supersedes the like-named Section 1581. This Section applies prospectively to business combinations for which the date of acquisition is in fiscal years beginning on or after January 1, 2011. The Section establishes standards for the recognition of a business combination. The Company will analyze the effects of the adoption of this Section together with the analysis of the International Financial Reporting Standards.



Consolidated financial statements

In January 2009, the CICA issued Section 1601, Consolidated Financial Statements, which supersedes the like-named Section 1600. This Section applies to interim and annual financial statements for fiscal years beginning on or after January 1, 2011. The Section establishes standards for the preparation of consolidated financial statements. The Company will analyze the effects of the adoption of this Section together with the analysis of the International Financial Reporting Standards.

Non-controlling interests


In January 2009, the CICA issued Section 1602, Non-controlling Interests, which supersedes Section 1600, Consolidated financial statements. This Section applies to interim and annual financial statements for fiscal years beginning on or after January 1, 2011. The Section establishes standards for the accounting of non-controlling interests in a subsidiary in the consolidated financial statements subsequent to a business combination. The Company will analyze the effects of the adoption of this Section together with the analysis of the International Financial Reporting Standards.

15. SUBSEQUENT EVENT

On July 16, 2009, the Company reached agreements for the disposal of certain assets of its Palmar Inc. subsidiary, which constitutes all of the Heavy Duty Group segment. These transactions should generate a net cash inflow of about $22,000 and a non-recurring net loss of approximately $5,000 that will be recorded in the third quarter.

Pursuant to Section 3475 of the CICA Handbook, titled Disposal of Long-Lived Assets and Discontinued Operations, the group's operating results have been reclassified and presented in the consolidated statement of earnings as a "Loss related to discontinued operations" for the 2009 and 2008 periods while the assets and liabilities of Palmar Inc. as at June 30, 2009 have been reclassified and presented in the consolidated balance sheet under "Assets or liabilities related to discontinued operations".

The following table provides the discontinued operations results for the three-month and six-month periods ended June 30, 2009 and 2008:



2nd QUARTER 6 MONTHS
2009 2008 2009 2008
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--------------------------------------------------------------------------
$ $
Sales 13,653 14,975 25,569 28,013
--------------------------------------------------------------------------

Loss before the
following items (824) (565) (2,199) (1,678)
--------------------------------------------------------------------------

Interests 38 106 82 201
Amortization 67 72 134 144
--------------------------------------------------------------------------
105 178 216 345
--------------------------------------------------------------------------

Loss before income taxes (929) (743) (2,415) (2,023)

Income taxes 308 253 813 690
--------------------------------------------------------------------------

Net loss from discontinued
operations (621) (490) (1,602) (1,333)
--------------------------------------------------------------------------
--------------------------------------------------------------------------


The following table provides the assets and liabilities related to
discontinued operations as of June 30, 2009:

--------------------------------------------------------------------------
Current assets
--------------------------------------------------------------------------
Accounts receivable 9,503
Inventory 20,775
Prepaid expenses 971
Future income taxes 29
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31,278

Long-term assets
--------------------------------------------------------------------------
Investments 760
Fixed assets 882
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1,642
--------------------------------------------------------------------------
Assets related to discontinued operations 32,920
--------------------------------------------------------------------------
--------------------------------------------------------------------------

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Current liabilities
--------------------------------------------------------------------------
Bank indebtedness 1,626
Accounts payable 5,529
--------------------------------------------------------------------------
7,155

Long-term liabilities
--------------------------------------------------------------------------
Future income taxes 15
--------------------------------------------------------------------------
Liabilities related to discontinued operations 7,170
--------------------------------------------------------------------------
--------------------------------------------------------------------------


Contact Information

  • Uni-Select Inc.
    Richard G. Roy
    President and Chief Executive Officer
    450-641-2440
    450-449-4908 (FAX)
    or
    Uni-Select Inc.
    Denis Mathieu
    Vice-President and Chief Financial Officer
    450-641-2440
    450-449-4908 (FAX)
    www.uni-select.com