Gendis Inc.
TSX : GDS

Gendis Inc.

April 11, 2013 17:12 ET

Gendis Inc. Announces Fourth Quarter Earnings and Annual Results

WINNIPEG, MANITOBA--(Marketwired - April 11, 2013) - Gendis Inc. (TSX:GDS) today announced its financial results for the 4th quarter ended January 31, 2013 and for the fiscal year ended January 31, 2013.

Revenue for the 4th quarter was $1,416,000 compared to $1,421,000 for last year's 4th quarter. Net earnings for the 4th quarter were $4,082,000 ($0.30 per share) compared to earnings of $17,759,000 ($1.28 per share) for last year's 4th quarter.

Revenue for the year was $5,887,000 compared to $5,938,000 last year. Net loss for the year was $4,218,000 ($0.30 per share) compared to net earnings of $17,088,000 ($1.23 per share) for last year.

The volatility in net earnings quarter over quarter and for the year over year is primarily due to the change in fair value of equity investments and investment properties with the attendant effect on deferred income taxes. Also, the 4th quarter last year included the settlement with the Canada Revenue Agency of a long outstanding tax claim, while the 2nd quarter this year included the settlement with our insurer on legal claims in a prior year. Revenue less expense for the 4th quarter was $557,000 compared to $350,000 for last year's 4th quarter. Revenue less expense for the year was $2,275,000 compared to $1,982,000 last year.

Condensed summarized information is as follows:
quarter ended year ended
in millions of Canadian dollars Jan 31 Jan 31 Jan 31 Jan 31
except per share 2013 2012 2013 2012
Revenue
Lease rental revenue 0.9 0.9 3.9 3.9
Investment income 0.5 0.5 2.0 2.0
Total revenue 1.4 1.4 5.9 5.9
Expense
Property 0.4 0.4 1.8 1.8
Administration & finance 0.4 0.6 1.8 2.1
Total expense 0.8 1.0 3.6 3.9
Revenue less expense 0.6 0.4 2.3 2.0
Fair value change:
Veresen (0.1 ) 1.3 (4.5 ) 4.1
OSUM - 6.2 (8.2 ) (2.2 )
Other equity investments - - (0.9 ) (0.2 )
Investment properties 1.8 0.7 1.7 2.5
Total fair value change 1.7 8.2 (11.9 ) 4.2
Settlement of legal claims - - 1.5 -
Income tax recovery 1.8 9.2 3.9 10.9
Net earnings (loss) 4.1 17.8 (4.2 ) 17.1
Earnings (loss) per share $ 0.30 $ 1.28 $ (0.30 ) $ 1.23
quarter ended year-to-date
in millions of Canadian dollars Jan 31 Jan 31 Jan 31 Jan 31
except per share 2013 2012 2013 2012
Fair value of investments:
Veresen 25.7 30.1
OSUM 14.5 25.6
Other equity investments 3.0 0.1
Investment properties 29.8 27.6
Other assets 2.0 1.6
Debt & payables 5.2 5.1
Deferred tax payable 0.6 4.7
Shareholders' equity 69.3 75.2
Cash flow from:
Operations
Cash receipts 1.4 1.3 6.1 5.8
Cash disbursements & finance expense (0.8 ) (0.8 ) (3.8 ) (4.0 )
Settlement of legal claims - - 1.5 (1.3 )
Income taxes recovered - 11.2 0.7 11.1
Investing
Proceeds on sales of investments 1.9 - 2.0 -
Purchase of investments (1.3 ) - (4.1 ) -
Expenditures on investment properties (0.1 ) - (0.6 ) -
Financing
Debt reduction (0.4 ) (7.8 ) (0.1 ) (7.4 )
Purchase of share capital for cancellation (0.2 ) - (0.4 ) -
Dividends (0.3 ) (3.8 ) (1.4 ) (4.2 )
GENDIS INC.
CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION
Jan 31 Jan 31
(unaudited - thousands of Canadian dollars) 2013 2012
ASSETS
Current assets
Cash 77 142
Receivables 1,929 1,464
Total current assets 2,006 1,606
Non current assets
Equity investments (note 2) 43,167 55,813
Investment property 29,775 27,560
Furnishings and equipment 48 52
Total non current assets 72,990 83,425
Total assets 74,996 85,031
LIABILITIES
Current liabilities
Credit facilities (note 3) 3,500 3,600
Payables 763 582
Total current liabilities 4,263 4,182
Non current liabilities
Post employment benefit obligation 972 961
Deferred income tax payable 578 4,723
Total non current liabilities 1,550 5,684
Total liabilities 5,813 9,866
SHAREHOLDERS' EQUITY 69,183 75,165
Total liabilities and shareholders' equity 74,996 85,031
GENDIS INC.
CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIODS ENDED JANUARY 31
(unaudited - thousands of Canadian quarter ended year-to-date
dollars except for share data) 2013 2012 2013 2012
Revenue
Lease rentals 914 915 3,874 3,905
Investment income 502 506 2,013 2,033
Total revenue 1,416 1,421 5,887 5,938
Expense
Property 404 404 1,817 1,860
Administration 421 605 1,627 1,745
Finance 34 62 168 351
Total expense 859 1,071 3,612 3,956
Revenue less expense 557 350 2,275 1,982
Fair value change
Equity investments (63 ) 681 (13,566 ) 1,663
Investment property 1,779 7,532 1,648 2,508
Total fair value change 1,716 8,213 (11,918 ) 4,171
Settlement of legal claims - - 1,483 -
Earnings (loss) before income tax 2,273 8,563 (8,160 ) 6,153
Income tax (expense) recovery
Current (51 ) 11,939 (203 ) 11,939
Deferred 1,860 (2,743 ) 4,145 (1,004 )
Total income tax recovery 1,809 9,196 3,942 10,935
Net earnings (loss) from operations and comprehensive income (loss)
4,082

17,759

(4,218
)
17,088
Net earnings (loss) from operations per share
0.30
$
1.28
$
(0.30
) $
1.23
GENDIS INC.
CONDENSED INTERIM STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(unaudited - thousands - shares & Canadian dollars as applicable) Share Capital Retained earnings Total
# $ $ $
Balance - January 31, 2011 13,937 14,650 47,608 62,258
Comprehensive loss to October 31, 2011 (671 ) (671 )
Dividend paid (348 ) (348 )
Balance - October 31, 2011 13,937 14,650 46,589 61,239
Comprehensive income for the quarter ended January 31, 2012 17,759 17,759
Dividends paid (3,833 ) (3,833 )
Balance - January 31, 2012 13,937 14,650 60,515 75,165
Comprehensive loss to October 31, 2012 (8,300 ) (8,300 )
Purchase of share capital for cancellation (46 ) (48 ) (95 ) (143 )
Dividends paid (1,045 ) (1,045 )
Balance - October 31, 2012 13,891 14,602 51,075 65,677
Comprehensive income for the quarter ended January 31, 2013 4,082 4,082
Purchase of share capital for cancellation (75 ) (79 ) (151 ) (230 )
Dividend paid (346 ) (346 )
Balance - January 31, 2013 13,816 14,523 54,660 69,183
GENDIS INC.
CONDENSED INTERIM STATEMENT OF CASH FLOWS
FOR THE PERIODS ENDED JANUARY 31
(unaudited - thousands of Canadian quarter ended year to date
dollars) 2013 2012 2013 2012
Changes in cash position
By operations
Cash receipts 1,409 1,284 6,074 5,830
Cash disbursements (756 ) (767 ) (3,624 ) (3,666 )
Receipt (payment) on settlement of legal claims
-

-

1,483

(1,250
)
Income taxes recovered - 11,235 706 11,161
Finance expense paid (34 ) (58 ) (169 ) (349 )
Total by operations 619 11,694 4,470 11,726
By investing activities
Proceeds from sale of equity investments 1,879 - 1,997 -
Acquisition of equity investments (1,350 ) - (4,088 ) -
Expenditures on investment property (96 ) (7 ) (567 ) (32 )
Proceeds on sale of equipment - - - 3
Expenditures on furnishings and equipment (12 ) - (13 ) (17 )
Total by investing activities 421 (7 ) (2,671 ) (46 )
By financing activities
Net advance (repayment) of credit facilities (397 ) (7,795 ) (100 ) (7,396 )
Purchase of share capital for cancellation (230 ) - (373 ) -
Dividends paid (346 ) (3,833 ) (1,391 ) (4,181 )
Total by financing activities (973 ) (11,628 ) (1,864 ) (11,577 )
Increase (decrease) in cash 67 59 (65 ) 103
Cash - beginning of period 10 83 142 39
Cash - end of period 77 142 77 142
Gendis Inc.
Notes to the unaudited Condensed Interim Financial Statements
January 31, 2013
(All tabular amounts in thousands of Canadian dollars unless otherwise stated)
1. General information
General information on Gendis Inc. is the same as disclosed in Note 1 to the complete audited annual financial report for the year ended January 31, 2013. The principal accounting policies applied in the preparation of these condensed interim financial statements are the same as set out in Note 2 to the complete audited annual financial report for the year ended January 31, 2013. These policies have been consistently applied to all periods presented.
2. Investments
Jan 31 Jan 31
2013 2012
Veresen 25,660 30,120
Osum 14,487 25,595
Other equity investments 3,020 98
43,167 55,813
3. Credit facilities
Borrowing Balance Remaining borrowing availability Carrying value of collateral
Jan 31 Jan 31 Jan 31 Jan 31 Jan 31 Jan 31
2013 2012 2013 2012 2013 2012
Banker's acceptances 3,000 3,000
Bank demand loan 500 600
3,500 3,600 6,500 8,400 23,760 27,890
Broker's margin account - - 1,205 1,115 2,920 2,328
3,500 3,600 7,705 9,515 26,680 30,218
4. Settlement of legal claims
During the 2nd quarter of the year ended January 31, 2013, the Company reached a settlement with its insurer concerning the settlement of legal claims against the Company and some of its Directors by two suppliers and a buying agent and importer to a former subsidiary of the Company. The Company received $1.5-million.
During the 4th quarter of the year ended January 31, 2012, the Company reached a settlement with the Canada Revenue Agency of its tax case involving the sale of the Company's shares in Sony of Canada Ltd in 1995. The Company received $11.2-million. The settlement represents a refund of 25% of the tax and arrears interest paid in 2001 on re assessment, plus interest from 2001 to the refund date.
5. Subsequent Event
On March 7, 2013, the Company declared a regular dividend of 2.5¢ per share to shareholders of record March 22, 2013, payable April 5, 2013.
6. Operating segments
Quarter
Ended
Jan 31


Realty


Corporate

Inter-
segment


Total
Revenue 2013 931 719 (234 ) 1,416
2012 930 645 (154 ) 1,421
Property & administration 2013 457 439 (71 ) 825
expense 2012 434 619 (44 ) 1,009
Finance expense 2013 163 34 (163 ) 34
2012 110 62 (110 ) 62
Fair value change 2013 1,779 (63 ) - 1,716
2012 680 7,533 - 8,213
Income tax recovery (expense) 2013 (432 ) 2,241 - 1,809
2012 (134 ) 9,330 - 9,196
Net earnings from operations 2013 1,658 2,424 - 4,082
& Comprehensive income 2012 932 16,827 - 17,759
Year
Ended
Jan 31


Realty


Corporate

Inter-
segment


Total
Revenue 2013 3,943 2,879 (935 ) 5,887
2012 3,965 2,603 (630 ) 5,938
Property & administration 2013 2,033 1,696 (285 ) 3,444
expense 2012 1,980 1,805 (180 ) 3,605
Finance expense 2013 650 168 (650 ) 168
2012 450 351 (450 ) 351
Fair value change 2013 1,648 (13,566 ) - (11,918 )
2012 2,508 1,663 - 4,171
Settlement of legal claims 2013 - 1,483 - 1,483
2012 - - - -
Income tax recovery (expense) 2013 (653 ) 4,595 - 3,942
2012 (477 ) 11,412 - 10,935
Net earnings (loss) from
operations & Comprehensive 2013 2,255 (6,473 ) - (4,218 )
income (loss) 2012 3,566 13,522 - 17,088
Total assets 2013 30,167 65,710 (20,882 ) 74,996
2012 28,149 69,234 (12,352 ) 85,031
Total liabilities 2013 22,377 4,318 (20,882 ) 5,813
2012 15,813 6,405 (12,352 ) 9,866

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