Gendis Inc.
TSX : GDS

Gendis Inc.

September 07, 2012 17:27 ET

Gendis Inc. Announces Second Quarter Results

WINNIPEG, MANITOBA--(Marketwire - Sept. 7, 2012) - Gendis Inc. (TSX:GDS) today announced its financial results for the 2nd quarter ended July 31, 2012.

Revenue for the 2nd quarter was $1,527,000 compared to $1,460,000 for last year's 2nd quarter. Net loss for the 2nd quarter was $7,736,000 ($0.56 per share) compared to a loss of $3,425,000 ($0.24 per share) for last year's 2nd quarter.

Revenue year-to-date was $3,040,000 compared to $3,098,000 last year. Net loss year-to-date was $7,509,000 ($0.54 per share) compared to a loss of $3,686,000 ($0.26 per share) for last year.

Lease rental revenue increased marginally while investment income was essentially even quarter over quarter and year-to-date. The decrease in earnings is primarily due to the change in fair value for equity investments quarter over quarter and year-to-date.

Condensed summarized information is as follows:

quarter ended year-to-date
in millions of Canadian dollars Jul 31 Jul 31 Jul 31 Jul 31
except per share 2012 2011 2012 2011
Lease rental revenue 1.0 1.0 2.0 2.1
Investment income 0.5 0.5 1.0 1.0
Expenses (1.1 ) (0.9 ) (2.0 ) (2.0 )
Fair value change:
Veresen (4.5 ) 0.8 (4.5 ) 1.9
OSUM (7.2 ) (7.9 ) (7.2 ) (9.0 )
Other investments (1.0 ) (0.2 ) (1.0 ) -
Real estate 1.2 1.2 0.7 0.2
Settlement of legal claims 1.5 - 1.5 -
Deferred tax recovery 1.9 2.1 2.0 2.1
Net loss (7.7 ) (3.4 ) (7.5 ) (3.7 )
Loss per share $ (0.56 ) $ (0.24 ) $ (0.54 ) $ (0.26 )
Fair value of investments:
Veresen 25.6 27.9
OSUM 18.4 18.9
Other investments 1.7 0.2
Real estate 28.3 25.3
Other assets 0.9 1.2
Debt & payables 5.4 13.3
Deferred tax payable 2.6 1.6
Shareholders equity 66.9 58.6
quarter ended year-to-date
in millions of Canadian dollars Jul 31 Jul 31 Jul 31 Jul 31
except per share 2012 2011 2012 2011
Cash flow from:
Operations 2.1 (1.3 ) 3.1 (0.7)
Investing - - (2.6 ) -
Financing (2.1 ) 1.5 (0.5 ) 1.0
GENDIS INC.
CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION
Jul 31 Jul 31 Jan 31
(unaudited - thousands of Canadian dollars) note 2012 2011 2012
ASSETS
Current assets
Cash 58 290 142
Receivables 812 832 1,464
Total current assets 870 1,122 1,606
Non current assets
Equity investments 2 45,737 47,047 55,813
Investment property 28,280 25,270 27,560
Furnishings and equipment 44 48 52
Total non current assets 74,061 72,365 83,425
Total assets 74,931 73,487 85,031
LIABILITIES
Current liabilities
Credit facilities 3 3,794 11,982 3,600
Payables 511 475 582
Current income tax payable 104 - -
Total current liabilities 4,409 12,457 4,182
Non current liabilities
Post employment benefit obligation 956 870 961
Deferred income tax payable 2,626 1,588 4,723
Total non current liabilities 3,582 2,458 5,684
Total liabilities 7,991 14,915 9,866
SHAREHOLDERS' EQUITY 66,940 58,572 75,165
Total liabilities and shareholders' equity 74,931 73,487 85,031
GENDIS INC.
CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIODS ENDED JULY 31
quarter year-to-date
(unaudited - thousands of Canadian dollars except for share data) note 2012 2011 2012 2011
Revenue
Lease rentals 1,025 950 2,028 2,078
Dividends and interest income 502 510 1,012 1,020
Total revenue 1,527 1,460 3,040 3,098
Expense
Property 572 439 1,043 1,061
Administration 534 388 905 792
Finance 54 93 104 185
Total expense 1,160 920 2,052 2,038
Fair value change
Investment property 1,230 1,160 720 225
Equity investments (12,735 ) (7,251) (12,696 ) (7,102 )
Total fair value change (11,505 ) (6,091) (11,976 ) (6,877 )
Settlement of legal claims 4 1,475 - 1,483 -
Loss before income tax (9,663 ) (5,551 ) (9,505 ) (5,817 )
Income tax recovery 1,927 2,126 1,996 2,131
Net loss from operations and comprehensive loss (7,736 ) (3,425 ) (7,509 ) (3,686 )
Net loss from operations per share $ (0.56 ) $ (0.24 ) $ (0.54 ) $ (0.26 )
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
Net loss from operations and comprehensive loss for the quarter ended April 30, 2011 (261 ) (261 )
Balance - April 30, 2011 13,937 14,650 47,347 61,997
Net loss from operations and comprehensive loss for the quarter ended July 31, 2011 (3,425 ) (3,425 )
Balance - July 31, 2011 13,937 14,650 43,922 58,572
Net earnings from operations and comprehensive income for the remainder of the year 20,774 20,774
Dividends paid (4,181 ) (4,181 )
Balance - January 31, 2012 13,937 14,650 60,515 75,165
Net earnings from operations and comprehensive income for the quarter ended April 30, 2012 227 227
Dividend paid (348 ) (348 )
Balance - April 30, 2012 13,937 14,650 60,394 75,044
Net loss from operations and comprehensive income for the quarter ended July 31, 2012 (7,736 ) (7,736 )
Redemption of share capital (6 ) (6 ) (13 ) (19 )
Dividend paid (349 ) (349 )
Balance - July 31, 2012 13,931 14,644 52,296 66,940
GENDIS INC.
CONDENSED INTERIM STATEMENT OF CASH FLOWS
FOR THE PERIODS ENDED JULY 31
quarter year-to-date
(unaudited - thousands of Canadian dollars) 2012 2011 2012 2011
Changes in cash position
By operations
Cash receipts 1,322 1,037 3,085 2,826
Cash disbursements (1,371 ) (955 ) (2,108 ) (2,024 )
Receipt (payment) on settlement of legal claims 1,475 (1,250 ) 1,483 (1,250 )
Income taxes recovered (paid) 706 - 706 (74 )
Finance expense paid (55 ) (93 ) (107 ) (188 )
Total by operations 2,077 (1,261 ) 3,059 (710 )
By investing activities
Proceeds from sale of equity investments - - 118 -
Acquisition of equity investments - - (2,739 ) -
Expenditures on investment property - - - (26 )
Total by investing activities - - (2,621 ) (26 )
By financing activities
Net advance (repayment) of credit facilities (1,702 ) 1,487 194 987
Redemption of share capital (19 ) - (19 ) -
Dividends paid (349 ) - (697 ) -
Total by financing activities (2,070 ) 1,487 (522 ) 987
Increase (decrease) in cash 7 226 (84 ) 251
Cash - beginning of period 51 64 142 39
Cash - end of period 58 290 58 290

Gendis Inc.

Notes to the unaudited Condensed Consolidated Interim Financial Statements

July 31, 2012

(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, 2012.

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, 2012. These policies have been consistently applied to all periods presented.

2. Investments

Jul 31 Jan 31
2012 2012
Veresen 25,620 30,120
OSUM 18,429 25,595
Oak Point Energy 1,000 -
Other equity investments 688 98
45,737 54,150
3. Credit facilities
Borrowing Remaining borrowing Carrying value
Balance availability of collateral
Jul 31 Jan 31 Jul 31 Jan 31 Jul 31 Jan 31
2012 2012 2012 2012 2012 2012
Banker's acceptances 3,494 3,000
Bank demand loan 300 600
3,794 3,600 6,200 8,400 23,722 27,890
Broker's margin account - - 1,013 1,115 2,586 2,328
3,794 3,600 7,213 9,515 26,308 30,218

4. Settlement of legal claims

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.

5. Subsequent Event

On September 7, 2012, the Company declared a regular dividend of 2.5¢ per share to shareholders of record September 21, 2012, payable October 5, 2012.

6. Operating segments

The segment information provided to the CEO for the reportable segments is as follows:

Quarter ended Intersegment Total
Jul 31 Realty Corporate Elimination
External revenue 2012 1,025 502 - 1,527
2011 950 510 - 1,460
Intersegment revenue 2012 18 216 (234 ) -
2011 15 145 (160 ) -
Property & administration expenses 2012 626 552 (72 ) 1,106
2011 469 403 (45 ) 827
Finance expense 2012 162 54 (162 ) 54
2011 115 93 (115 ) 93
Fair values changes 2012 1,230 (12,735 ) - (11,505 )
2011 1,160 (7,251 ) - (6,091 )
Settlement of legal claims 2012 - 1,475 - 1,475
2011 - - - -
Income tax (expense) recovery 2012 (401 ) 2,328 - 1,927
2011 (416 ) 2,542 - 2,126
Net earnings (loss) from operations 2012 1,084 (8,820 ) - (7,736 )
& Comprehensive income (loss) 2011 1,125 (4,550 ) - (3,425 )
Year-to-date ended Intersegment Total
Jul 31 Realty Corporate Elimination
External revenue 2012 2,028 1,012 - 3,040
2011 2,078 1,020 - 3,098
Intersegment revenue 2012 35 432 (467 ) -
2011 31 286 (317 ) -
Property & administration expenses 2012 1,151 940 (143 ) 1,948
2011 1,120 824 (91 ) 1,853
Finance expense 2012 324 104 (324 ) 104
2011 226 185 (226 ) 185
Fair values changes 2012 720 (12,696 ) - (11,976 )
2011 225 (7,102 ) - (6,877 )
Settlement of legal claims 2012 - 1,483 - 1,483
2011 - - - -
Income tax (expense) recovery 2012 (353 ) 2,349 - 1,996
2011 (267 ) 2,398 - 2,131
Net earnings (loss) from operations 2012 955 (8,464 ) - (7,509 )
& Comprehensive income (loss) 2011 721 (4,407 ) - (3,686 )
Total assets 2012 28,932 64,629 (18,630 ) 74,931
2011 25,938 60,858 (13,309 ) 73,487
Total liabilities 2012 22,441 4,180 (18,630 ) 7,991
2011 16,448 11,776 (13,309 ) 14,915

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