Goodfellow Reports its Results for the Fourth Quarter Ended August 31, 2014 and Declares an Eligible Dividend

DELSON, QUEBEC--(Marketwired - Oct. 9, 2014) - Goodfellow Inc. (TSX:GDL) announced today its financial results for the fourth quarter ended August 31, 2014. The Company reported net earnings of $3.7 million or $0.43 per share compared to net earnings of $3.0 million or $0.35 per share a year ago. Consolidated sales for the fourth quarter were $146.3 million compared to $137.8 million last year. Sales in the Canada and the US were particularly active throughout the fourth quarter due to stronger housing starts both sides of the Border. Export sales slipped during the same period as shipments to the Asian market slowed down. On the operating side, variable costs increased slightly with the higher volume of sales and increased production output during the fourth quarter. As a result, direct, selling, and administrative expenses increased to $21.2 million ($20.9 million last year).

For the twelve months ended August 31, 2014, the Company generated net earnings of $6.6 million or $0.78 per share compared to net earnings of $5.3 million or $0.62 per share a year ago. Consolidated sales for the twelve months of fiscal 2014 were $486.0 million compared to $483.5 million for the same period a year ago.

"The 4^th quarter showed considerable improvement in all market areas and products. Helped by record hardwood lumber sales and a strong performance in our Toronto branch, this made up for what was a most difficult preceding winter." said Richard Goodfellow, President and Chief Executive Officer.

Dividend

The Board of directors of Goodfellow Inc. declared an eligible dividend of $0.25 per share payable October 30, 2014, to all shareholders of record as of October 17, 2014.

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. Consolidated Statements of Comprehensive Income (in thousands of dollars, except per share amounts) Unaudited
		Twelve months ended August 31		Three months ended August 31
		2014	2013	2014	2013
		$	$	$	$
Sales		486,045	483,485	146,289	137,814
Expenses
	Cost of goods sold	394,262	393,560	119,217	112,318
	Selling, administrative and general expenses	80,274	80,675	21,170	20,857
	Net financial costs	2,168	1,943	740	580
		476,704	476,178	141,127	133,755
Earnings before income taxes		9,341	7,307	5,162	4,059
Income taxes		2,709	2,028	1,497	1,086
Net earnings, being comprehensive income		6,632	5,279	3,665	2,973
Earnings per share
	Basic and diluted	0.78	0.62	0.43	0.35

GOODFELLOW INC. Consolidated Statements of Financial Position (in thousands of dollars) Unaudited
		August 31 2014	August 31 2013 (Restated)
		$	$
Assets
Current Assets
	Cash and cash equivalents	433	197
	Trade and other receivables	76,559	72,838
	Inventories	98,083	74,255
	Prepaid expenses	3,774	3,433
Total Current Assets		178,849	150,723
Non-Current Assets
	Property, plant and equipment	37,299	35,422
	Defined benefit plan asset	1,520	1,041
Total Non-Current Assets		38,819	36,463
		217,668	187,186
Liabilities
Current liabilities
	Bank indebtedness	60,434	34,169
	Trade and other payables	29,782	29,457
	Income taxes payable	1,410	742
	Current portion of long term debt	218	38
Total Current Liabilities		91,844	64,406
Non-Current Liabilities
	Provisions	1,513	1,471
	Long Term Debt	716	112
	Deferred income taxes	2,393	2,393
	Defined benefit plan obligation	834	1,666
Total Non-Current Liabilities		5,456	5,642
		97,300	70,048
Shareholders' equity
	Share capital	9,152	9,152
	Retained earnings	111,216	107,986
		120,368	117,138
		217,668	187,186

GOODFELLOW INC. Consolidated Statements of Cash Flows (in thousands of dollars) Unaudited
			Twelve months ended August 31				Three months ended August 31
			2014		2013		2014		2013
			$		$		$		$
Cash Flows Used in Operating Activities
	Net Earnings		6,632		5,279		3,665		2,973
	Adjustments for :
		Depreciation	2,819		2,758		777		709
		Accretion expense on environmental provision	43		29		12		30
		Deffered Income tax	-		320		-		320
		Gain on disposal of fixed assets	(5	)	(65	)	-		(65	)
		Income tax expense	2,709		1,708		1,497		766
		Interest expense	1,340		1,165		499		390
		Funding in excess of pension plan expense	(1,311	)	(1,513	)	56		(336	)
			12,227		9,681		6,506		4,787
	Changes in non-cash working capital items		(27,503	)	265		12,350		39,668
	Interest paid		(1,403	)	(1,135	)	(458	)	(313	)
	Income taxes paid		(2,041	)	(989	)	(445	)	(318	)
			(30,947	)	(1,859	)	11,447		39,037
Cash Flows From (Used In) Financing Activities
	(Decrease) Increase in bank loans		(6,000	)	2,000		(2,200	)	1,000
	Increase (decrease) in banker's acceptances		33,000		(1,000	)	(9,000	)	(34,000	)
	Long term debt		784		150		(51	)	-
	Redemption of shares		-		(14	)	-		-
	Dividends paid		(3,402	)	(2,977	)	(1,701	)	(1,702	)
			24,382		(1,841	)	(12,952	)	(34,702	)
Cash Flows Used In Investing Activities
	Acquisition of property, plant and equipment		(4,701	)	(2,571	)	(270	)	(443	)
	Proceeds on disposal of capital assets		10		68		-		68
			(4,691	)	(2,503	)	(270	)	(375	)
Net cash outflow			971		3,478		4,731		8,747
Cash position, beginning of year			(4,972	)	(8,450	)	(8,732	)	(13,719	)
Cash position, end of year			(4,001	)	(4,972	)	(4,001	)	(4,972	)
Cash position is comprised of :
	Cash and cash equivalents		433		197		433		197
	Bank overdraft		(4,434	)	(5,169	)	(4,434	)	(5,169	)
			(4,001	)	(4,972	)	(4,001	)	(4,972	)

GOODFELLOW INC. Consolidated Statements of Change in Shareholders' Equity For The Twelve Months Ended August 31, 2014 and 2013 (in thousands of dollar) Unaudited
		Share Capital		Retained Earnings		Total
		$		$		$
Balance as at August 31, 2012		9,154		99,521		108,675
Net earnings		-		5,279		5,279
Transactions with owners, recorded directly in shareholders' equity
	Dividends	-		(2,977	)	(2,977	)
	Redemption of Shares	(2	)	(12	)	(14	)
	Other Comprehensive income			6,175		6,175
Balance as at August 31, 2013		9,152		107,986		117,138
Net earnings		-		6,632		6,632
Transactions with owners, recorded directly in shareholders' equity
	Dividends	-		(3,402	)	(3,402	)
Balance as at August 31, 2014		9,152		111,216		120,368