Premium Brands Holdings Corporation
TSX : PBH

Premium Brands Holdings Corporation

August 08, 2013 07:00 ET

Premium Brands Holdings Corporation Announces Second Quarter Results

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Aug. 8, 2013) - Premium Brands Holdings Corporation (TSX:PBH), a leading producer, marketer and distributor of branded specialty food products, announced today its results for the second quarter of 2013.

HIGHLIGHTS FOR THE QUARTER:

  • Revenue for the quarter increased by 12.0% to $278.9 million as compared to $249.0 million for the second quarter of 2012. Revenue for the first two quarters of 2013 as compared to the first two quarters of 2012 increased by $42.7 million or 9.2% to $508.1 million.

  • Adjusted EBITDA for the quarter increased to $21.0 million as compared to $20.7 million in the second quarter of 2012. For the first two quarters of 2013, adjusted EBITDA increased to $33.8 million as compared to $32.3 million for the first two quarters of 2012.

  • The Company increased its quarterly dividend by 6.3% to $0.3125 per share.

  • Rolling four quarters free cash flow increased to $47.3 million resulting in a dividend to free cash flow ratio of 53.2%.

  • Decommissioned a deli meat production facility in Richmond, BC and transitioned production to the Company's other deli meat plants including its recently acquired Freybe Langley plant.

  • Completed the sale and leaseback of Freybe's deli meat plant resulting in net proceeds of $22.8 million after purchasing a 35% interest in the real estate holding partnership that acquired the property.

  • Initiated a process to explore strategic alternatives for better servicing the convenience store channel with the goals of improving the efficiency and effectiveness of the distribution system and maximizing the value of its NDSD convenience store distribution business.
SUMMARY FINANCIAL INFORMATION
(In thousands of dollars except per share amounts and ratios)
13 Weeks Ended 13 Weeks Ended 26 Weeks Ended 26 Weeks Ended
Jun 29, 2013 Jun 30, 2012 Jun 29, 2013 Jun 30, 2012
Revenue 278,929 248,984 508,110 465,427
Adjusted EBITDA 21,015 20,688 33,773 32,291
Net earnings 5,323 7,013 6,489 8,174
EPS 0.25 0.34 0.31 0.40
Rolling Four Quarters Ended
Jun 29, 2013 Dec 29, 2012
Free cash flow 47,315 46,784
Declared dividends 25,140 24,381
Declared dividend per share 1.1945 1.176
Payout ratio 53.2 % 52.1 %

"During the quarter we continued to make significant progress towards our goal of becoming North America's leading specialty food company," said Mr. George Paleologou, President and CEO. "Many of our established businesses are generating solid top and bottom line growth while others are making investments that will ideally position them to capitalize on emerging market trends," added Mr. Paleologou.

Three of the Company's businesses that are in the midst of major transformations, and correspondingly are having a short term negative impact on the Company's earnings, are:

  • Stuyver's, which recently invested $19.1 million in a new state-of-the-art artisan bakery;

  • The Company's Deli Group, which wound down an older deli meat production facility and is transferring its production to its other deli meat plants including a state-of-the-art 118,000 square foot facility that was purchased as part of its acquisition of Freybe Gourmet Foods in the first quarter of 2013; and

  • NDSD, which is undergoing a major restructuring in response to significant changes occurring in the convenience store industry.

"Our Bakery Group made significant strides during the quarter in improving its profitability both through continued improvement of production processes at its new plant and by realizing on several significant new sales opportunities," stated Mr. Paleologou.

"Similarly, our Deli Group made substantial progress with the orderly wind down of its older deli meat production facility in Richmond, BC. This initiative, which is scheduled to be completed by the end of the third quarter, is expected to result in significant operational synergies.

"On the sales and marketing side, our Deli Group further enhanced its product portfolio during the quarter with the purchase of a 25% interest, along with options to increase its ownership to 100%, in McLean Meats Inc. McLean's is a niche marketer and distributor of branded, high quality, preservative-free and organic processed meats to the foodservice and retail industries. The Deli Group intends to leverage this investment to accelerate its growth in these rapidly expanding food categories.

"In terms of NDSD, this business is being impacted by the continued contraction of food sales in the convenience store channel. We do, however, still see potential in this channel and as such have initiated a process to explore strategic alternatives for better servicing it. We expect this process to result in improvements in the efficiency and effectiveness of the distribution system used for our products in this channel and to allow us to maximize the value of NDSD.

"Our confidence in the progress we are making is reflected in our decision in the quarter to increase our dividend by 6.3% to $0.3125 per quarter. Our recent capital investments and operational initiatives, combined with the strengths and competitive advantages resulting from our solid foundation of diversified and entrepreneurial businesses, position us to continue generating significant shareholder value," added Mr. Paleologou.

About Premium Brands

Premium Brands owns a broad range of leading specialty food manufacturing and differentiated food distribution businesses with operations in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, Nevada and Washington State. The Company services over 22,000 customers and its family of brands and businesses include Grimm's, Harvest, McSweeney's, Bread Garden Go, Hygaard, Hempler's, Quality Fast Foods, Gloria's Best of Fresh, Direct Plus, National Direct-to-Store Distribution (NDSD), Harlan Fairbanks, Creekside Bakehouse, Centennial Foodservice, B&C Food Distributors, Shahir, Wescadia, Duso's, Maximum Seafood, SK Food Group, OvenPride, Hub City Fisheries, Audrey's, Deli Chef, Piller's and Freybe.

RESULTS OF OPERATIONS

Revenue
(in thousands of dollars except percentages)
13 weeks ended Jun 29, 2013 % 13 weeks ended Jun 30, 2012 % 26 weeks ended Jun 29, 2013 % 26 weeks ended Jun 30, 2012 %
Revenue by segment:
Retail 174,305 62.5 % 150,187 60.3 % 312,628 61.5 % 282,814 60.8 %
Foodservice 104,624 37.5 % 98,797 39.7 % 195,482 38.5 % 182,613 39.2 %
Consolidated 278,929 100.0 % 248,984 100.0 % 508,110 100.0 % 465,427 100.0 %

Retail's revenue for the second quarter of 2013 as compared to the second quarter of 2012 increased by $24.1 million or 16.1% due to: (i) the acquisition of Freybe which accounted for $20.1 million of the increase; and (ii) organic growth of $8.6 million, representing an average growth rate of 6.5%, from its legacy businesses after excluding NDSD.

These increases were partially offset by (i) a $2.7 million decrease in NDSD's sales resulting from the restructuring of its convenience store (C-store) distribution network (see Restructuring Costs) as well as continued contraction of food sales in the C-store channel; and (ii) the sale of Retail's fresh sandwich plant in Etobicoke, ON in the fourth quarter of 2012 which resulted in a $1.9 million decrease in fresh sandwich sales to the C-store channel.

Retail's revenue for the first two quarters of 2013 increased by $29.8 million or 10.5% as compared to the first two quarters of 2012 due to: (i) the acquisition of Freybe which accounted for $20.1 million of the increase; and (ii) organic growth of $18.4 million, representing an average growth rate of 7.4%, from its legacy businesses after excluding NDSD.

These increases were partially offset by: (i) a $5.3 million decrease in NDSD's sales resulting from the restructuring of its C-store distribution network as well as continued contraction of food sales in the C-store channel; and (ii) the sale of Retail's fresh sandwich plant in Etobicoke, ON in the fourth quarter of 2012 which resulted in a $3.4 million decrease in fresh sandwich sales to the C-store channel.

Looking forward (see Forward-Looking Statements), the Company is not providing growth guidance for the balance of 2013 for its Retail segment due to uncertainties associated with its Richmond plant transition initiative (see Restructuring Costs).

Foodservice's revenue for the second quarter of 2013 as compared to the second quarter of 2012 increased by $5.8 million or 5.9% due to: (i) general organic growth of $3.0 million representing an organic growth rate of 3.2%; (ii) the acquisition of certain businesses from Harbour Marine which accounted for $2.0 million of the increase; and (iii) increased sales in its Worldsource food brokerage business of $0.8 million resulting from improved trading opportunities.

Foodservice's revenue for the first two quarters of 2013 as compared to the first two quarters of 2012 increased by $12.9 million or 7.0% due to: (i) general organic growth of $7.4 million representing an organic growth rate of 4.2%; (ii) the acquisition of certain businesses from Harbour Marine which accounted for $3.8 million of the increase; and (iii) increased sales in its Worldsource food brokerage business of $1.7 million resulting from improved trading opportunities.

Foodservice's organic growth rate for both the quarter and the first two quarters of 2013 was below the Company's long-term target of 6% to 8% due to: (i) a supply shortage of wild and exotic seafood that impacted the sales of Maximum Seafood and Hub City Fisheries; and (ii) poorer than normal weather in western Canada which impacted Harlan Fairbanks and, to a lesser extent, Centennial Foodservice.

Looking forward (see Forward-Looking Statements), for the balance of 2013 the Company expects Foodservice's organic sales growth to continue to be below its long-term targeted range of 6% to 8% due to ongoing shortages of wild and exotic seafood.

Gross Profit
(in thousands of dollars except percentages)
13 weeks ended Jun 29, 2013 % 13 weeks ended Jun 30, 2012 % 26 weeks ended Jun 29, 2013 % 26 weeks ended Jun 30, 2012 %
Gross profit by segment:
Retail 39,706 22.8 % 35,187 23.4 % 67,688 21.7 % 63,928 22.6 %
Foodservice 19,454 18.6 % 19,628 19.9 % 36,011 18.4 % 34,686 19.0 %
Consolidated 59,160 21.2 % 54,815 22.0 % 103,699 20.4 % 98,614 21.2 %

Retail's gross profit as a percentage of its revenue (gross margin) for the second quarter of 2013 as compared to the second quarter of 2012 decreased due to the restructuring of NDSD's business (see Restructuring Costs). The restructuring resulted in the conversion of NDSD's customers in certain geographic regions from being serviced by NDSD's direct-to-store delivery trucks to being serviced by third party distributors and wholesale distributors. As a result, where this conversion has occurred the Company now sells its products at a discounted price to the new distributor who in turn sells and distributes the Company's products to C-store retailers. Corresponding with this change, and the lost margin associated with it, NDSD has been able to significantly reduce its SG&A (see Selling, General and Administrative Expenses).

Retail's gross margin for the first two quarters of 2013 as compared to the first two quarters of 2012 decreased due to: (i) the restructuring of NDSD's business as discussed above; (ii) temporary production inefficiencies at SK Food Group's Reno, NV plant in the first quarter of 2013 due to a combination of the launch of new sandwich wraps for two large international customers in the fourth quarter of 2012 and the installation of several new pieces of equipment during the first quarter of 2013; and (iii) increased plant overheads associated with Stuyver's new artisan bakery in Langley, BC, which was completed in the third quarter of 2012, and Deli Chef's new sandwich production facility in Laval, QC, which was completed in the second quarter of 2012.

Foodservice's gross margin for the second quarter of 2013 as compared to the second quarter of 2012 as well as for the first two quarters of 2013 as compared to the first two quarters of 2012 decreased due to: (i) poor production efficiencies at Hub City Fisheries resulting from record low salmon runs and a corresponding shortage of wild fish for processing; (ii) difficulties by Maximum Seafood in maintaining its selling margins due to a combination of global shortages in certain species of wild and exotic seafood combined with regional consumer price resistance; and (iii) a rapid rise in premium beef commodity prices.

Selling, General and Administrative Expenses (SG&A)
(in thousands of dollars except percentages)
13 weeks ended Jun 29, 2013 % 13 weeks ended Jun 30, 2012 % 26 weeks ended Jun 29, 2013 % 26 weeks ended Jun 30, 2012 %
SG&A by segment:
Retail 23,700 13.6 % 19,724 13.1 % 41,854 13.4 % 38,886 13.7 %
Foodservice 12,774 12.2 % 12,574 12.7 % 24,835 12.7 % 24,168 13.2 %
Corporate 1,671 1,829 3,237 3,269
Consolidated 38,145 13.7 % 34,127 13.7 % 69,926 13.8 % 66,323 14.2 %

Retail's SG&A for the second quarter of 2013 as compared to the second quarter of 2012 as well as for the first two quarters of 2013 as compared to the first two quarters of 2012 increased due to: (i) the acquisition of Freybe; and (ii) increased selling and marketing costs associated with Retail's organic sales growth (see Revenue). These increases were partially offset by a significant decrease in NDSD's SG&A as a result of its restructuring (see Gross Profit).

Foodservice's SG&A for the second quarter of 2013 as compared to the second quarter of 2012 as well as for the first two quarters of 2013 as compared to the first two quarters of 2012 increased due to: (i) higher variable selling costs associated with Foodservice's organic sales growth (see Revenue); and (ii) increased costs associated with the development of the infrastructure needed to accelerate the growth of its seafood based initiatives.

Adjusted EBITDA
(in thousands of dollars except percentages)
13 weeks ended Jun 29, 2013 % 13 weeks ended Jun 30, 2012 % 26 weeks ended Jun 29, 2013 % 26 weeks ended Jun 30, 2012 %
Adjusted EBITDA by segment:
Retail 16,006 9.2 % 15,463 10.3 % 25,834 8.3 % 25,042 8.9 %
Foodservice 6,680 6.4 % 7,054 7.1 % 11,176 5.7 % 10,518 5.8 %
Corporate (1,671 ) (1,829 ) (3,237 ) (3,269 )
Consolidated 21,015 7.5 % 20,688 8.3 % 33,773 6.6 % 32,291 6.9 %

The Company's adjusted EBITDA for the second quarter of 2013 as compared to the second quarter of 2012 increased only slightly to $21.0 million from $20.7 million primarily due to solid organic growth across the majority of the Company's businesses being mostly offset by reduced earnings in NDSD, Maximum Seafood and Hub City Fisheries.

NDSD's reduced earnings were primarily due to the continued contraction of food sales in the C-store channel. This contraction is the result of a range of factors including competition from quick service restaurants, changing consumer eating habits, pay-at-the-pump legislation and high gas prices.

Maximum Seafood's and Hub City Fisheries' reduced earnings were due to temporary supply shortages of wild and exotic seafood.

The Company's most recently acquired business, Freybe, had a positive, albeit relatively small, impact on the Company's adjusted EBITDA for the quarter despite significant disruptions in Freybe's operations caused by the Richmond plant transition (see Restructuring Costs).

Looking forward (see Forward Looking Statements) the Company expects its adjusted EBITDA to be favourably impacted by the following:

  1. a significant increase in the earnings of Freybe after the realignment of its Langley plant is complete (see Restructuring Costs). Currently the Company expects this process to be finished late in the third quarter of 2013, at which time Freybe is projected to be generating annualized adjusted EBITDA of approximately $6.3 million;

  2. a steady improvement in Stuyver's and Deli Chef's margins as these businesses leverage the incremental capacity of new production facilities built in 2012 to generate new sales; and

  3. improved earnings from Maximum Seafood and Hub City Fisheries once wild and exotic seafood supply conditions return to normal levels.

In terms of NDSD, the Company recognizes that as a result of the continued contraction of food sales in the C-store channel, further consolidation is needed of the distribution companies servicing this industry. Correspondingly, the Company has initiated a process to explore strategic alternatives for better servicing the convenience store channel with the goals of improving the efficiency and effectiveness of the distribution system used for our products in this channel and maximizing the value of its NDSD convenience store distribution business.

Due to uncertainties associated with the timing and impact of the items outlined above, the Company is not providing guidance on its projected adjusted EBITDA for 2013.

Interest

The Company's interest and other financing costs for the second quarter of 2013 as compared to the second quarter of 2012 and for the first two quarters of 2013 as compared to the first two quarters of 2012 rose primarily due to an increase in the Company's funded debt.

Restructuring Costs

Restructuring costs consist of costs associated with the significant restructuring of one or more of the Company's businesses. During the first two quarters of 2013 the Company incurred $4.5 million in restructuring costs consisting of:

  • $2.5 million for the transitioning of production from the Company's Richmond, BC deli meat processing plant (the Richmond plant transition) to some of its other deli meat processing plants including Freybe's Langley, BC facility. This transition began in the first quarter of 2013 and the transfer of production was completed by the end of the second quarter.

    Looking forward (see Forward Looking Statements), the Company expects Freybe's Langley plant to continue to incur restructuring costs relating to this initiative due to: (i) setup problems associated with processing equipment transferred from the Richmond plant; (ii) employee training related issues; and (iii) production disruptions resulting from the refinement of production processes and the installation of new equipment designed to improve production flows and expand capacity. The Company anticipates that the transition will be substantially completed in the third quarter of 2013 and will result in approximately $2.5 million in additional restructuring costs in 2013.
  • $1.6 million in costs relating to the restructuring and rationalization of NDSD's direct-to-store distribution network for the C-store channel (see Revenue). Looking forward (see Forward-Looking Statements), the Company expects this restructuring to be substantially completed in the third quarter of 2013 and will result in approximately $1.0 million in additional restructuring costs in 2013.

  • $0.2 million in non-recurring costs relating to Centennial Foodservice's seafood initiatives, which include the startup of its new seafood processing facility in Richmond, BC and the integration of the businesses acquired from Harbour Marine. This initiative was completed in the first quarter of 2013.

  • $0.2 million in restructuring costs associated with a variety of initiatives including moving the Company's head office to a new location in Richmond, BC.
FREE CASH FLOW
(in thousands of dollars) 52 weeks
ended
Dec 29, 2012
26 weeks
ended
Jun 30, 2012
26 weeks
ended
Jun 29, 2013
Rolling
Four
Quarters
Cash flow from operating activities 49,849 19,020 12,073 42,902
Changes in non-cash working capital (6,050 ) 3,106 7,491 (1,665 )
Acquisition transaction costs 197 53 472 616
Restructuring costs 5,705 1,660 4,519 8,564
Capital maintenance expenditures (2,917 ) (1,479 ) (1,664 ) (3,102 )
Free cash flow 46,784 22,360 22,891 47,315

FORWARD-LOOKING STATEMENTS

This discussion and analysis contains forward looking statements with respect to the Company, including its business operations, strategy and financial performance and condition. These statements generally can be identified by the use of forward looking words such as "may", "could", "should", "would", "will", "expect", "intend", "plan", "estimate", "project", "anticipate", "believe" or "continue", or the negative thereof or similar variations.

Although management believes that the expectations reflected in such forward looking statements are reasonable and represent the Company's internal expectations and belief as of August 7, 2013, such statements involve unknown risks and uncertainties beyond the Company's control which may cause its actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward looking statements.

Factors that could cause actual results to differ materially from the Company's expectations include, among other things: (i) seasonal and/or weather related fluctuations in the Company's sales; (ii) changes in consumer discretionary spending resulting from changes in economic conditions and/or general consumer confidence levels; (iii) changes in the cost of raw materials used in the production of the Company's products; (iv) changes in the cost of products sourced from third party manufacturers and sold through the Company's proprietary distribution networks; (v) risks associated with the Company's conversion from a publicly traded income trust to a publicly traded corporation, including related changes in Canada's income tax laws; (vi) changes in the Company's relationships with its larger customers; (vii) potential liabilities and expenses resulting from defects in the Company's products; (viii) changes in consumer food product preferences; (ix) competition from other food manufacturers and distributors; (x) execution risk associated with the Company's growth and business restructuring initiatives; (xi) risks associated with the Company's business acquisition strategies; (xii) changes in the value of the Canadian dollar relative to the U.S. dollar; and (xiii) new government regulations affecting the Company's business and operations. Details on these risk factors as well as other factors can be found in the Company's 2012 MD&A, which is filed electronically through SEDAR and is available online at www.sedar.com.

Unless otherwise indicated, the forward looking information in this document is made as of August 7, 2013 and, except as required by applicable law, will not be publicly updated or revised. This cautionary statement expressly qualifies the forward looking information in this document.

Premium Brands Holdings Corporation
Consolidated Balance Sheets
(Unaudited and in thousands of dollars)
June 29, 2013 December 29, 2012 June 30, 2012 January 1, 2012
Current assets:
Cash and cash equivalents 2,522 3,758 3,462 4,486
Accounts receivable 90,327 80,180 82,790 78,343
Other assets 498 193 92 103
Inventories 100,367 79,456 92,954 78,831
Prepaid expenses 7,349 6,631 5,632 13,340
201,063 170,218 184,930 175,103
Capital assets 178,579 166,447 174,759 158,801
Intangible assets 77,286 71,994 74,618 77,087
Goodwill 167,442 154,451 154,819 150,417
Other assets 4,262 4,866 2,367 2,250
Investment in associates 7,814 5,181 5,161 5,001
Deferred income taxes 25,865 32,575 34,314 41,334
662,311 605,732 630,968 609,993
Current liabilities:
Cheques outstanding 2,280 1,928 2,043 2,500
Bank indebtedness 22,559 11,179 10,832 18,061
Dividend payable 6,595 6,188 6,005 5,958
Accounts payable and accrued liabilities 98,227 83,081 89,136 79,998
Current portion of long-term debt 23,549 127,195 18,551 17,530
Current portion of provisions 4,223 3,848 2,705 2,924
Other - - 100 -
157,433 233,419 129,372 126,971
Long-term debt 147,557 13,058 129,374 160,915
Convertible unsecured subordinated debentures 133,727 133,842 142,451 89,396
Puttable interest in subsidiaries 15,541 15,649 14,847 15,210
Deferred revenue 1,381 1,443 1,698 1,943
Provisions 3,695 503 8,779 8,360
Pension obligation 1,952 1,873 1,389 1,345
Other - - - 100
461,286 399,787 427,910 404,240
Equity attributable to shareholders:
Accumulated earnings 154,461 147,916 141,489 133,370
Accumulated dividends declared (167,643 ) (154,878 ) (142,503 ) (130,497 )
Retained earnings (deficit) (13,182 ) (6,962 ) (1,014 ) 2,873
Share capital 209,558 209,093 200,079 198,057
Equity component of convertible debentures 1,747 1,785 1,916 1,916
Reserves 2,159 448 657 1,442
Non-controlling interest 743 1,581 1,420 1,465
201,025 205,945 203,058 205,753
662,311 605,732 630,968 609,993
Premium Brands Holdings Corporation
Consolidated Statements of Operations
(Unaudited and in thousands of dollars except per share amounts)
13 weeks ended June 29, 2013 13 weeks ended June 30, 2012 26 weeks ended June 29, 2013 26 weeks ended June 30, 2012
Revenue 278,929 248,984 508,110 465,427
Cost of goods sold 219,769 194,169 404,411 366,813
Gross profit before depreciation and amortization 59,160 54,815 103,699 98,614
Selling, general and administrative expenses before depreciation and amortization 38,145 34,127 69,926 66,323
21,015 20,688 33,773 32,291
Depreciation of capital assets 4,485 3,456 8,428 6,762
Amortization of intangible assets 1,092 1,245 2,180 2,487
Amortization of other assets 2 - 3 3
Interest and other financing costs 4,674 4,283 8,839 8,293
Amortization of financing costs 80 102 154 212
Acquisition transaction costs 439 5 472 53
Change in value of puttable interest in subsidiaries 282 525 482 705
Accretion of provisions 101 210 104 419
Unrealized (gain) loss on foreign currency contracts (200 ) (200 ) (300 ) 100
Unrealized (gain) loss on interest rate swap contracts (100 ) 400 - (100 )
Restructuring costs 3,222 921 4,519 1,660
Equity (gain) loss in associates (177 ) (121 ) 5 (160 )
Earnings before income taxes 7,115 9,862 8,887 11,857
Provision for income taxes
Current 848 366 1,206 942
Deferred 944 2,483 1,192 2,741
1,792 2,849 2,398 3,683
Earnings 5,323 7,013 6,489 8,174
Earnings (loss) for the period attributable to:
Shareholders 5,349 7,004 6,545 8,119
Non-controlling interest (26 ) 9 (56 ) 55
5,323 7,013 6,489 8,174
Earnings per share
Basic and diluted 0.25 0.34 0.31 0.40
Weighted average shares outstanding (in 000's)
Basic 20,982 20,325 20,969 20,275
Diluted 21,076 20,420 21,064 20,370
Premium Brands Holdings Corporation
Consolidated Statements of Cash Flows
(Unaudited and in thousands of dollars)
13 weeks ended June 29, 2013 13 weeks ended June 30, 2012 26 weeks ended June 29, 2013 26 weeks ended June 30, 2012
Cash flows from operating activities:
Earnings 5,323 7,013 6,489 8,174
Items not involving cash:
Depreciation of capital assets 4,485 3,456 8,428 6,762
Amortization of intangible and other assets 1,094 1,245 2,183 2,490
Amortization of financing costs 80 102 154 212
Change in value of puttable interest in subsidiaries 282 525 482 705
(Gain) loss on disposal of capital assets (38 ) 47 (41 ) 15
Accrued interest income (7 ) (8 ) (13 ) (15 )
Unrealized (gain) loss on foreign currency contracts (200 ) (200 ) (300 ) 100
Unrealized (gain) loss on interest rate swaps (100 ) 400 - (100 )
Equity (gain) loss in associate (177 ) (121 ) 5 (160 )
Deferred revenue (121 ) (116 ) (248 ) (245 )
Accretion of convertible debentures, long-term debt and provisions 749 719 1,403 1,447
Change in value of cash conversion option liability - - (170 ) -
Deferred income taxes 944 2,483 1,192 2,741
12,314 15,545 19,564 22,126
Change in non-cash working capital 4,952 (5,771 ) (7,491 ) (3,106 )
17,266 9,774 12,073 19,020
Cash flows from financing activities:
Long-term debt - net (20,527 ) (42,425 ) 26,464 (31,010 )
Bank indebtedness and cheques outstanding (10,674 ) (3,538 ) 11,731 (7,686 )
Convertible debentures - net of issuance costs - 54,600 - 54,600
Dividends paid to shareholders (6,170 ) (6,001 ) (12,358 ) (11,959 )
Purchase of 7.00% Debentures under normal course issuer bid (41 ) - (219 ) -
Other (16 ) (2 ) (54 ) (2 )
(37,428 ) 2,634 25,564 3,943
Cash flows from investing activities:
Capital asset additions (3,683 ) (11,785 ) (6,764 ) (23,015 )
Business acquisitions 505 - (53,842 ) -
Payments to shareholders of non-wholly owned subsidiaries (750 ) (1,007 ) (864 ) (1,153 )
Payment of provisions (247 ) (219 ) (500 ) (219 )
Collection of share purchase loans and notes receivable 74 115 92 184
Promissory note from associate 500 - 500 -
Net proceeds from sales of assets 25,052 204 25,055 292
Investment in associates (2,638 ) - (2,638 ) -
18,813 (12,692 ) (38,961 ) (23,911 )
Decrease in cash and cash equivalents (1,349 ) (284 ) (1,324 ) (948 )
Effects of exchange on cash and cash equivalents 65 (40 ) 88 (76 )
Cash and cash equivalents - beginning of period 3,806 3,786 3,758 4,486
Cash and cash equivalents - end of period 2,522 3,462 2,522 3,462
Interest and other financing costs paid 1,942 5,084 7,735 7,052
Net income taxes paid 1,756 923 1,965 1,524

Contact Information

  • Premium Brands Holdings Corporation
    George Paleologou
    President and CEO
    (604) 656-3100

    Premium Brands Holdings Corporation
    Will Kalutycz
    CFO
    (604) 656-3100