Goodfellow Inc.

Goodfellow Inc.

March 22, 2005 17:52 ET

Goodfellow Reports its Results for Q2-2005


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: GOODFELLOW INC.

TSX SYMBOL: GDL

MARCH 22, 2005 - 17:52 ET

Goodfellow Reports its Results for Q2-2005

DELSON, QUEBEC--(CCNMatthews - March 22, 2005) - Goodfellow Inc.
(TSX:GDL) announced today its sales and net earnings for second quarter
ending February 28, 2005. Sales, for the second quarter, decreased
2.8% to $106.1 million compared to $109.2 million a year ago. Net
earnings decreased to $573 thousand or $0.14 per share compared to $1.1
million or $0.27 per share for the same period last year. Sales
activities were reduced by the US exchange rate dropping 6.4%. On the
other hand, gross margins remained constant throughout the second
quarter. Operational costs increased from $15.7 million to $16.5
million during the second quarter ended February 28, 2005. This was due
to new business activities, higher energy and fuel costs, above average
maintenance work on our equipment and accruing for additional profit
sharing. Financial cost decreased 9.5% from $663 thousand to $600
thousand in the second quarter ended February 28, 2005.

For the first six months ended February 28, 2005, sales increased 3.5%
from $228.2 million to $236.2 million. Net earnings for that period
decreased from $4.5 million or $1.08 per share to $3.8 million or $0.91
per share. Cash income calculated on a comparative basis held
relatively steady disregarding a change in the profit sharing accruals.

"Business conditions over the second quarter period were not as good as
last year as volume declined slightly but more importantly margins
remained relatively constant," said Richard Goodfellow, Goodfellow's
President and Chief Executive Officer. "The outlook for the spring ahead
is promising."

Goodfellow Inc. is eastern Canada's largest independent re-manufacturer
and distributor of lumber products and Canada's largest distributor of
hardwood flooring products. Goodfellow's shares trade on the Toronto
Stock Exchange under the symbol GDL.



GOODFELLOW INC.
STATEMENT OF INCOME
(in thousands of dollars
except earnings per share)
(Unaudited)

Six Months Three Months
Ended February 28 Ended February 28
2005 2004 2005 2004
$ $ $ $
---------------------------------------------------------------------
Sales 236,241 228,218 106,117 109,235
---------------------------------------------------------------------

Expenses
Cost of goods sold, selling,
administrative and
general expenses 228,073 218,780 104,113 106,304
Depreciation and amortization 1,010 995 515 502
Financial 1,192 1,293 600 663
---------------------------------------------------------------------
230,275 221,068 105,228 107,469
---------------------------------------------------------------------

Income before income taxes 5,966 7,150 889 1,766
Income taxes 2,118 2,610 316 645
---------------------------------------------------------------------
Net income 3,848 4,540 573 1,121
---------------------------------------------------------------------

---------------------------------------------------------------------
Earnings per share 0.91 1.08 0.14 0.27
---------------------------------------------------------------------
Earnings per share diluted 0.90 1.08 0.13 0.27
---------------------------------------------------------------------



GOODFELLOW INC.
CONDENSED BALANCE SHEET
(in thousands of dollars)
(Unaudited)

As At February 28
2005 2004
$ $
---------------------------------------------------------------------
Current assets 133,329 122,618
Total assets 161,906 150,428
Current liabilities 77,664 75,913
Long-term debt - -
Total liabilities 80,028 78,628
Shareholder's equity 81,878 71,800
---------------------------------------------------------------------



GOODFELLOW INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of dollars) Six Months Three Months
(unaudited) Ended February 28 Ended February 28
2005 2004 2005 2004
$ $ $ $
---------------------------------------------------------------------
Operating activities
Net income 3,848 4,540 573 1,121
Items not affecting cash
Depreciation of amortization 1,010 995 515 502
Pension plan expense 48 - 48 -
Future income taxes - - - -
Gain on disposal of assets (6) - - -
---------------------------------------------------------------------
4,901 5,535 1,137 1,623
Changes in non-cash operating
working capital balances
Decrease (increase) in accounts
receivable 24,485 12,064 6,360 (682)
Decrease (increase)
in inventories (16,934) (12,135) 965 913
Decrease (increase) in
prepaid expenses (604) (51) (849) 104
Increase (decrease) in
accounts payable (6,544) (4,793) (3,644) (3,084)
Increase (decrease)
in income taxes (4,491) 1,430 (680) 23
---------------------------------------------------------------------
813 2,050 3,289 (1,103)
---------------------------------------------------------------------
Financing activities
Dividends (2,320) (966) - -
Repayment of long-term debt - (2,750) - -
Purchase of common shares - - - -
Issuance of common shares 226 50 182 50
---------------------------------------------------------------------
(2,095) (3,666) 182 50
---------------------------------------------------------------------
Investing activities
Acquisition of fixed assets (1,624) (1,911) (702) (764)
Disposal of fixed assets 9 9 - -
---------------------------------------------------------------------
(1,615) (1,902) (702) (764)
---------------------------------------------------------------------
Net cash inflow (outflow) (2,897) (3,518) 2,768 (1,817)
---------------------------------------------------------------------
Cash and cash equivalents,
beginning of period (51,654) (48,614) (57,319) (50,315)
---------------------------------------------------------------------
Cash and cash equivalents,
end of period (54,551) (52,132) (54,551) (52,132)
---------------------------------------------------------------------


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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Goodfellow Inc.
    Richard Goodfellow
    President and CEO
    (450) 635-6511
    (450) 635-3730 (FAX)
    info@goodfellowinc.com