Goodfellow Inc.
TSX : GDL

Goodfellow Inc.

March 24, 2009 18:09 ET

Goodfellow Reports its Results for Q2-2009

DELSON, QUEBEC--(Marketwire - March 24, 2009) - Goodfellow Inc. (TSX:GDL) announced today its financial results for the second quarter ended February 28, 2009. Consolidated sales reached $91.5 million compared to $99.2 million a year ago. Results from operations for the second quarter of fiscal 2009 resulted in a net loss of $0.8 million or $0.09 per share compared to a net income of $38 thousand or $0.00 per share a year ago. The results from operations for the second quarter of fiscal 2009 excludes a non recurring gain of $3.1 million or $0.37 per share which represents the revaluation at fair value of fixed assets exchanged resulting from the expropriation of part of our Delson facility. The expropriation file was closed on February 25, 2009 and concludes almost 4 years of negotiations with the Governmental Authorities. Consequently net income for the second quarter of fiscal 2009 reached $2.4 million or $0.28 per share for the second quarter of fiscal 2009. Major efforts were expended to reduce costs in all areas of the business. Personnel head-count is down by 130 versus a year ago and most other costs were down 10% or more. With the weakened economy bad debts were running at double last year's levels but these were somewhat balanced by reduced financial costs due to the substantially reduced receivables and inventories.

For the 6 months ended February 28, 2009, Consolidated Sales reached $202.4 million compared to $217.3 million for the same period last year. Net results from operations for the 6 months ended February 28, 2009 was $0.3 million or $0.03 per share compared to $1.9 million or $0.22 per share. Including the non recurring gain of $3.1 million or $0.37 per share related to the revaluation at fair value, net income for the 6 months of fiscal 2009 reached $3.4 million or $0.40 per share.

"2009 continues to be a challenging time for both the company and the overall world economy. Your management team continues to be preoccupied with ensuring the company's overall health and positioning it to weather the storms ahead." said Richard Goodfellow, President and Chief Executive Officer. "Nevertheless, we remain cautiously optimistic for the spring and summer quarters, the time when traditionally the Company has made the majority of its operating profits."

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



GOODFELLOW INC.
STATEMENT OF INCOME
(in thousands of dollars
except earnings per share) Six Months Three Months
(unaudited) Ended February 28 Ended February 28
2009 2008 2009 2008
$ $ $ $
--------------------------------------------------------------------------
Sales 202,435 217,254 91,515 99,209
--------------------------------------------------------------------------

Expenses
Cost of goods sold, selling,
administrative and general
expenses 195,981 212,226 87,441 98,068
Depreciation and
amortization 1,080 1,121 562 569
Financial 661 1,047 298 513
--------------------------------------------------------------------------
197,722 214,394 88,300 99,150
--------------------------------------------------------------------------

Income before income taxes 4,713 2,859 3,215 58
Income taxes 1,265 958 781 20
--------------------------------------------------------------------------
Net income 3,448 1,901 2,434 38
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Earnings per share 0.40 0.22 0.28 0.00
--------------------------------------------------------------------------
Earnings per share diluted 0.40 0.22 0.28 0.00
--------------------------------------------------------------------------



CONSOLIDATED BALANCE SHEETS As at As at As at
(in thousand of dollars) February 28, February 29, August 31,
2009 2008 2008
(unaudited) (unaudited) (audited)
$ $ $
--------------------------------------------------------------------------
Assets
Current assets
Cash 629 1,308 860
Accounts receivable 51,265 57,370 72,843
Income taxes recoverable 2,495 2,350 2,045
Inventories 63,051 74,710 47,135
Prepaid expenses 2,969 5,825 3,810
--------------------------------------------------------------------------
120,409 141,563 126,693

Capital assets 30,682 26,534 25,873
Deferred pension asset 4,301 3,524 3,828
--------------------------------------------------------------------------
155,392 171,621 156,394
--------------------------------------------------------------------------

Liabilities
Current liabilities
Bank indebtedness 23,850 46,457 21,940
Accounts payable and accrued
liabilities 23,795 23,854 29,471
Income taxes payable - - -
--------------------------------------------------------------------------
47,646 70,311 51,411

Future income taxes 2,690 1,678 1,498

Shareholders' equity
Capital stock 9,223 9,238 9,229
Retained earnings 95,833 90,697 94,559
Accumulated other comprehensive
income - (303) (303)
--------------------------------------------------------------------------
105,056 99,632 103,485
--------------------------------------------------------------------------
155,392 171,621 156,394
--------------------------------------------------------------------------



CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
(in thousands of dollars) Six Months
(unaudited) Ended February 28
2009 2008
$ $
--------------------------------------------------------------------------

Balance at beginning 94,559 91,801
Net income for the period 3,448 1,901
--------------------------------------------------------------------------
98,007 93,702
Redemption of shares 30 -
Dividends 2,144 3,005
--------------------------------------------------------------------------
Balance at end 95,833 90,697
--------------------------------------------------------------------------



CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of dollars) Six Months Three Months
(unaudited) Ended February 28 Ended February 28
2009 2008 2009 2008
$ $ $ $
--------------------------------------------------------------------------
Operating activities
Net income 3,448 1,901 2,434 38
Items not affecting cash
Depreciation and
amortization 1,080 1,121 562 569
Excess (shortage) of
expense over pension
plan funding (472) (470) (248) (255)
Gain on disposal of assets (4,298) - (4,202) -
Deferred income taxes 1,192 - 1,192 -
--------------------------------------------------------------------------
950 2,552 (262) 352
Changes in non-cash operating
working capital balances
Decrease (increase) in
accounts receivable 21,578 25,480 2,141 1,045
Decrease (increase) in
inventories (15,916) (22,426) 5,120 (3,591)
Decrease (increase) in
prepaid expenses 841 (992) 2,887 (2,253)
Increase (decrease) in
accounts payable (5,677) (7,500) (3,699) (5,924)
Increase (decrease) in
income taxes (450) (2,542) (588) (1,800)
--------------------------------------------------------------------------
1,326 (5,428) 5,599 (12,171)
--------------------------------------------------------------------------
Financing activities
Dividends (2,144) (3,005) - -
Purchase of common shares (30) - (18) -
--------------------------------------------------------------------------
(2,174) (3,005) (18) -
--------------------------------------------------------------------------
Investing activities
Acquisition of fixed assets (1,778) (1,044) (1,212) (456)
Disposal of fixed assets 181 - 30 -
--------------------------------------------------------------------------
(1,597) (1,044) (1,182) (456)
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Other comprehensive income 303 (119) 303 -
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Net cash inflow (outflow) (2,142) (9,596) 4,702 (12,627)
--------------------------------------------------------------------------
Cash and cash equivalents,
beginning of period (21,079) (35,553) (27,923) (32,522)
--------------------------------------------------------------------------
Cash and cash equivalents,
end of period (23,221) (45,149) (23,221) (45,149)
--------------------------------------------------------------------------



CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands of dollars,
except earnings per share) Six months Three months
(unaudited) Ended February 28 Ended February 28
2009 2008 2009 2008
$ $ $ $
--------------------------------------------------------------------------

Net income 3,448 1,901 2,434 38

Other comprehensive income
Net investments in
self-sustaining foreign
operations 303 (119) 303 -
--------------------------------------------------------------------------
Total other comprehensive
income 303 (119) 303 -
--------------------------------------------------------------------------

Comprehensive income 3,751 1,782 2,737 38
--------------------------------------------------------------------------

Contact Information