Groupe Bikini Village Inc.
TSX : GBV

Groupe Bikini Village Inc.

September 04, 2012 15:37 ET

Groupe Bikini Village inc. Reports its Results for the Second Quarter of 2012

SAINTE-JULIE, QUEBEC--(Marketwire - Sept. 4, 2012) - Groupe Bikini Village inc. (TSX:GBV) ("Groupe Bikini Village" or the "Corporation") today reported the results of its second quarter of 2012. During the quarter, the Corporation operated in a challenging competitive retail environment characterised by a growing number of retailers offering swimsuits in the summer; it reported stable sales as well as a lower operating margin (EBITDA(1)) than it had in the second quarter of 2011.

2012 second quarter and first six-month period results

Net sales for the second quarter and the first six-month period of 2012 were $13.6 million and $23.3 million, respectively, compared to $13.6 million and $23.5 million in the corresponding periods the previous year; sales decreased 1% in the first half of the year. Comparable sales, which compares the sales from the same number of stores year-over-year, decreased by 2.8% for the quarter and 0.4% for the six-month period.

The Corporation's EBITDA(1) for the second quarter and the first six-month period of 2012 were $1.5 million and $1.7 million, respectively, compared to EBITDA(1) of $1.8 million for the second quarter and $1.9 million for the first six-month period of the previous year. The decrease is principally due to a reduction in gross margin, caused by additional promotional activities resulting from the increased and aggressive summer competition.

For the quarter ended July 28, 2012, the Corporation's net earnings is $748,000 ($0.39 per share, basic and diluted), as compared to net earnings of $890,000 ($0.47 per share, basic and diluted) for the same quarter in the previous year. For the six-month period ended on that date, net earnings totalled $448,000 ($0.23 per share, basic and diluted), as compared to net earnings of $537,000 ($0.28 per share, basic and diluted) in the same period in 2011.

"Our second quarter results do not reflect the sales we had anticipated, given the favourable weather conditions this summer. Moving forward, we will keep investing sustained efforts to improve our performance, execute our strategy and differentiate our offering in the market," said Yves Simard, President and CEO of Groupe Bikini Village inc.

Outlook (2)

"We are confident in our strategies, and will continue to focus on improving performance at all levels of the organization to increase business volumes while generating increased profitability," said Mr. Simard. "In addition, we will persist in our efforts to identify and take advantage of opportunities to create long-term value."

In the months to come, Groupe Bikini Village will continue to open stores under the "Bikini Village Outlet" brand it launched in November 2011. This strategy will allow the Corporation to strengthen this distribution channel and gain market share in a category where it was not active before, while ensuring a continuing flow of trendy, fresh goods in its regular network: a key factor in its differentiation strategy.

Groupe Bikini Village inc.'s full second quarter 2012 report, as well as previous shareholder reports and other information of interest to investors, are available on SEDAR at www.sedar.com, and on the Corporation's website at www.bikinivillage.com.

About Groupe Bikini Village

Groupe Bikini Village inc., serving Canadians for more than a quarter-century, is a leader in the retail sale of beachwear products, with a network of new and renovated boutiques across Eastern Canada. In its bright and inviting stores with comfortable change rooms and knowledgeable staff, Groupe Bikini Village helps its customers choose from among Canada's widest selection of swimsuits, beach and cruise wear and accessories, in the most popular brands the industry has to offer and in styles to suit every figure. Headquartered in Sainte-Julie, Quebec, Groupe Bikini Village operates 55 stores and employs approximately 500 people; its securities trade on the Toronto Stock Exchange under the stock symbol GBV. For more information about Groupe Bikini Village, please visit our website at www.bikinivillage.com.

Notes

(1) The term EBITDA (earnings before finance costs, income taxes, depreciation, amortization, net impairment loss, reorganization fees and unusual items) does not have any standardized meaning prescribed by Canadian Generally Accepted Accounting Principles applicable to publicly accountable enterprises ("GAAP") and may not be comparable to similarly-titled measures presented by other companies. Please refer to the section of Groupe Bikini Village inc's. MD&A for the for the six-month period ended July 28, 2012, dated September 4, 2012, entitled "Non-GAAP Financial Measures." It is available on SEDAR at www.sedar.com.

(2) To be read in conjunction with "Forward-looking Statements" below.

Forward-looking statements

This news release contains certain forward-looking statements concerning Groupe Bikini Village inc.'s future operations, economic performance, financial conditions and financing plans. These statements are based on certain assumptions and analyses made by management in light of their experience and their perception of historical trends, current conditions and expected future developments, as well as other factors they believe are appropriate under the circumstances. However, whether actual results and developments will conform to management's expectations and predictions is subject to a number of risks, uncertainties and assumptions. Consequently, all of the forward-looking statements made in this news release are qualified by these cautionary statements, and there can be no assurance that the results or developments anticipated by management will be realized or, even if substantially realized, that they will have the expected consequences or effects on the Corporation. Management undertakes no obligation and does not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable law.

GROUPE BIKINI VILLAGE INC.
STATEMENTS OF NET EARNINGS AND COMPREHENSIVE INCOME
(in thousands of Canadian dollars, except amounts related to shares)
(unaudited)
Three months ended Six months ended
July 28, 2012 July 30, 2011 July 28, 2012 July 30, 2011
Revenues $ 13,587 $ 13,642 $ 23,307 $ 23,532
Cost of goods sold 6,386 6,097 10,486 10,362
Gross profit 7,201 7,545 12,821 13,170
Operating and administrative expenses 6,011 6,090 11,860 11,966
Net finance costs 158 203 327 419
Earnings before income tax charge 1,032 1,252 634 785
Income tax charge 284 362 186 248
NET EARNINGS AND COMPREHENSIVE INCOME (1) $ 748 $ 890 $ 448 $ 537
EARNINGS PER SHARE
Basic 0.39 0.47 0.23 0.28
Diluted 0.39 0.47 0.23 0.28
Weighted average number of oustanding shares
Basic 1,910,597 1,910,597 1,910,597 1,910,597
Diluted 1,937,987 1,912,240 1,932,361 1,911,832
(1) A reconciliation of net earnings and comprehensive income to earnings before interest, taxes, depreciation and amortization ("EBITDA") is as follows:
Net earnings and comprehensive income $ 748 $ 890 $ 448 $ 537
Income tax charge 284 362 186 248
Net finance costs 158 203 327 419
Depreciation and amortization of capital and intangible assets 352 389 690 723
EBITDA $ 1,542 $ 1,844 $ 1,651 $ 1,927

Contact Information