Goodfellow Inc.
TSX : GDL

Goodfellow Inc.

October 13, 2015 18:59 ET

Goodfellow Reports Its Results for the Third Quarter Ended August 31, 2015 and Declares an Eligible Dividend

DELSON, QUEBEC--(Marketwired - Oct. 13, 2015) - Goodfellow Inc. (TSX:GDL) announced today its financial results for the nine months ended August 31, 2015. The Company reported a net income of $6.6 million or $0.78 per share compared to $5.5 million or $0.64 per share a year ago. For the three months ended August 31, 2015, the Company reported net income of $3.7 million or $0.44 per share compared to $3.7 million or $0.43 per share a year ago. Consolidated sales for the nine months ended August 31, 2015 were $403.8 million compared to $375.7 million last year. Consolidated sales for the three months ended August 31, 2015 were $151.7 million compared to $146.3 million last year. Sales in Canada during the first nine months of fiscal 2015 increased 6% compared to the same period a year ago mainly due to increased market share in Western Canada and Atlantic provinces and increased Pressure Treated wood sales with retailer's customers group. Sales in the United States for the first nine months ended August 31, 2015 increased 18% on a Canadian dollar basis compared to the same period last year due to the increased foreign exchange conversion factor and increased demand for flooring and hardwood lumber product lines. On a non-converted basis, US denominated sales increased 3% compared to last year. Finally, Export sales increased 10% during the first nine months of fiscal 2015 compared to the same period a year ago mainly due to increasing demand for value added products in Asia and Europe mitigated by a decrease in the United Kingdom region. On the operating side, Selling, Administrative and General Expenses increased 7% compared to the corresponding period last year due to increased production output of value-added products, increased selling expenses related to the improved sales performance and increased administration expenses linked with the Saskatoon branch opening.

"We were successful with increased sales of treated wood and the introduction of new products. On the other hand a very soft construction market combined with low commodity prices caused us to fall short of our objectives. Sales slowed down significantly in August and this same situation continues in September." said Denis Fraser, President and Chief Executive Officer. "In this context, we are taking measures to contain cost and protect our profitability. Our order book for value added engineered products remains strong and we see some new strengths in the export market. These should support our results for the fourth quarter."

The Board of directors of Goodfellow Inc. declared an eligible dividend of $0.20 per share payable November 20, 2015, to all shareholders of record as of November 6, 2015.

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
For the three months and nine months ended August 31, 2015 and 2014
(in thousands of dollars, except per share amounts)
(Unaudited)
For the three months ended For the nine months ended
August 31
2015
August 31
2014
August 31
2015
August 31
2014
$ $ $ $
Sales 151,749 146,289 403,821 375,679
Expenses
Cost of goods sold 122,821 119,217 327,223 305,158
Selling, administrative and general expenses 22,962 21,170 65,313 61,097
Net financial costs 711 740 1,958 1,725
146,494 141,127 394,494 367,980
Earnings before income taxes 5,255 5,162 9,327 7,699
Income taxes 1,524 1,497 2,705 2,233
Net earnings, being comprehensive income 3,731 3,665 6,622 5,466
Earnings per share
Basic and diluted 0.44 0.43 0.78 0.64
GOODFELLOW INC.
Consolidated Statements of Financial Position
(in thousands of dollars)
As at As at As at
August 31 November 30 August 31
2015 2014 2014
(Unaudited) (Audited) (Unaudited)
$ $ $
Assets
Current Assets
Cash and cash equivalents 1,280 860 433
Trade and other receivables 74,215 60,591 76,559
Inventories 108,286 92,257 98,083
Prepaid expenses 8,176 3,271 3,774
Total Current Assets 191,957 156,979 178,849
Non-Current Assets
Property, plant and equipment 37,362 37,020 37,299
Defined benefit plan asset 1,824 1,848 1,520
Total Non-Current Assets 39,186 38,868 38,819
Total Assets 231,143 195,847 217,668
Liabilities
Current liabilities
Bank indebtedness 59,440 43,099 60,434
Trade and other payables 39,225 25,779 29,782
Income taxes payable 1,863 997 1,410
Provision 938 979 -
Current portion of long term debt 50 229 218
Total Current Liabilities 101,516 71,083 91,844
Non-Current Liabilities
Provision 512 473 1,513
Long term debt 25 692 716
Deferred income taxes 2,535 2,535 2,393
Defined benefit plan obligation 1,723 1,578 834
Total Non-Current Liabilities 4,795 5,278 5,456
Total Liabilities 106,311 76,361 97,300
Shareholders' equity
Share capital 9,152 9,152 9,152
Retained earnings 115,680 110,334 111,216
124,832 119,486 120,368
Total Liabilities and Shareholders' Equity 231,143 195,847 217,668
GOODFELLOW INC.
Consolidated Statements of Cash Flows
For the three months and nine months ended August 31, 2015 and 2014
(in thousands of dollars)
(Unaudited)
For the three months ended For the nine months ended
August 31 August 31 August 31 August 31
2015 2014 2015 2014
$ $ $ $
Operating Activities
Net Earnings 3,731 3,665 6,622 5,466
Adjustments for :
Depreciation 758 777 2,235 2,186
Accretion expense on environmental provision 10 12 (1 ) 35
Loss on disposal of property, plant and equipment - - 16 -
Income tax expense 1,524 1,497 2,705 2,233
Interest expense 424 499 1,231 1,126
Funding in deficit (excess) of pension plan expense 57 56 170 (759 )
6,504 6,506 12,978 10,287
Changes in non-cash working capital items 4,814 12,350 (20,957 ) (32,123 )
Interest paid (623 ) (458 ) (1,388 ) (1,227 )
Income taxes paid (340 ) (445 ) (1,839 ) (1,361 )
3,851 11,447 (24,184 ) (34,711 )
Net Cash Flows from Operating Activities 10,355 17,953 (11,206 ) (24,424 )
Financing Activities
Increase (Decrease) in bank loans 7,000 (2,200 ) 5,500 2,000
(Decrease) Increase in banker's acceptances (12,000 ) (9,000 ) 10,000 32,000
Long term debt (12 ) (51 ) (845 ) 784
Dividends paid (1,276 ) (1,701 ) (1,276 ) (1,701 )
(6,288 ) (12,952 ) 13,379 33,083
Investing Activities
Acquisition of property, plant and equipment (1,494 ) (270 ) (2,611 ) (4,341 )
Proceeds on disposal of property, plant and equipment - - 17 -
(1,494 ) (270 ) (2,594 ) (4,341 )
Net cash inflow (outflow) 2,573 4,731 (421 ) 4,318
Cash position, beginning of period (6,733 ) (8,732 ) (3,739 ) (8,319 )
Cash position, end of period (4,160 ) (4,001 ) (4,160 ) (4,001 )
Cash position is comprised of :
Cash and cash equivalents 1,280 433 1,280 433
Bank overdraft (5,440 ) (4,434 ) (5,440 ) (4,434 )
(4,160 ) (4,001 ) (4,160 ) (4,001 )
GOODFELLOW INC.
Consolidated Statements of Change in Shareholders' Equity
For the nine months ended August 31, 2015 and 2014
(in thousands of dollars)
(Unaudited)
Share
Capital
Retained
Earnings
Total
$ $ $
Balance as at November 30, 2013 9,152 107,451 116,603
Net earnings - 5,466 5,466
Dividends - (1,701 ) (1,701 )
Total Comprehensive income 9,152 111,216 120,368
Transactions with owners, recorded directly in shareholders' equity - - -
Balance as at August 31, 2014 9,152 111,216 120,368
Balance as at November 30, 2014 (Audited) 9,152 110,334 119,486
Net earnings - 6,622 6,622
Dividends - (1,276 ) (1,276 )
Total Comprehensive income 9,152 115,680 124,832
Transactions with owners, recorded directly in shareholders' equity - - -
Balance as at August 31, 2015 9,152 115,680 124,832

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