SICO INC.
TSX : SIC

SICO INC.

August 04, 2005 08:00 ET

SICO Achieves Second-Quarter Net Earnings of $8.7 Million

LONGUEUIL, QUEBEC--(CCNMatthews - Aug. 4, 2005) - Sico Inc. (TSX:SIC) - All amounts are expressed in Canadian dollars unless otherwise indicated.



- Net earnings for the first six months reach $11.4 million or $0.84
per share ($0.83 diluted), up 25.1% over the previous year.

- The Company benefits from the ongoing expansion of its
architectural paint distribution networks throughout Canada and the
positive impact of the streamlining carried out in the Industrial
Sector in 2004.

For the second quarter ended July 1, 2005, SICO INC. ("SICO" or "the
Company", ticker symbol SIC/TSX) recorded sales of $99.1 million, up
5.0% compared to $94.4 million for the same period in 2004.

- The ARCHITECTURAL SECTOR's sales posted a solid growth of 7.1%.
Pierre Dufresne, SICO's President and Chief Executive Officer,
pointed out that the fact that 2005 began one week later, as
opposed to 2004, had only a slight effect on the Architectural
Sector's sales growth, which was mostly attributable to the
continuous expansion of the Company's distribution networks
throughout Canada. "We are particularly pleased with this
performance as the Canadian architectural paint industry
experienced a slowdown in retail sales growth during the second
quarter."

- The INDUSTRIAL SECTOR's sales declined by 9.7%, mainly due to the
divestiture of SICO's interest in the Sico-Becker S.A.S. ("Sico-
Becker") joint venture during the fourth quarter of 2004, combined
with a weak U.S. dollar and stronger competition from U.S.
manufacturers who took advantage of their weaker currency in
relation to the Canadian dollar.

Second-quarter net earnings rose 9.6% to $8.7 million or $0.64 per
common share ($0.63 diluted), up from $8.0 million or $0.58 per
common share (basic and diluted) in the same quarter a year earlier.

- The increase in quarterly net earnings is largely attributable to
the INDUSTRIAL SECTOR's marked improvement in operating income
resulting mainly from the sale of Sico-Becker.


The ARCHITECTURAL SECTOR also contributed to the growth in the Company's net earnings, despite an increase in manufacturing and distribution costs, which affected this sector's profit margins. Besides the inflated cost of certain raw materials, SICO was faced with a significant increase in delivery costs due particularly to soaring fuel prices. However, these factors were partially offset by the selling price increases we implemented in certain product categories during the first quarter.

For the six-month period ended July 1, 2005, SICO achieved total sales of $167.1 million compared to $157.3 million in the corresponding period of 2004, an increase of 6.2%. Year-to-date net earnings amounted to $11.4 million or $0.84 per common share ($0.83 diluted), up 25.1% compared to $9.2 million or $0.67 per share ($0.66 diluted) a year earlier. In addition to the factors mentioned above, a significant part of the excess of 2005 year-to-date sales and net earnings over those of 2004 can be explained by the one-week shift between the beginning of the two fiscal years (which contributed to the increase of the 2005 first-quarter results). This shifting effect will reverse in the fourth quarter of 2005.

Outlook

"We remain confident as to SICO's performance in 2005, however we are concerned about the upward pressures on the price of certain raw materials, higher delivery costs and the impact of the strong Canadian dollar on the competitive environment of our Industrial Sector," Pierre Dufresne said. "Economic conditions are still mostly favorable to the Canadian architectural paint industry, even though growth in renovation spending and housing starts has slowed down compared to last year. The Architectural Sector will bank on a steady sales growth, operating efficiency and tight cost controls to compensate for the increase in manufacturing and distribution expenses. In addition, demand for our industrial products remains strong, despite the more intense competition in some markets. Finally, we remain on the lookout for business acquisitions to further consolidate SICO's position in its target markets," Pierre Dufresne concluded.

Dividends

The Board of Directors has declared a quarterly dividend of $0.07 per common share and a dividend of $0.01478 per Class B preferred share. These dividends will be paid on September 23, 2005 to the Company's registered shareholders as at September 9, 2005.



CONSOLIDATED STATEMENTS OF EARNINGS
For the three-month and six-month periods
ended July 1, 2005 and June 25, 2004
(in thousands of dollars except share data)
(unaudited)
Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $

Sales 99,086 94,355 167,131 157,315
Cost of sales and
operating expenses
(Notes 3, 7 and 9) 83,926 80,313 146,195 139,590
Restructuring expenses - (71) - (71)
---------------------------------------------------------------------
Operating earnings
before: 15,160 14,113 20,936 17,796
---------------------------------------------------------------------
Depreciation
and amortization
(Note 5) 1,793 1,566 3,471 3,032
Financial
expenses
(Note 6) 408 409 686 867
---------------------------------------------------------------------
2,201 1,975 4,157 3,899
---------------------------------------------------------------------
Earnings before
income taxes 12,959 12,138 16,779 13,897
Income taxes 4,215 4,163 5,334 4,747
---------------------------------------------------------------------
Net earnings 8,744 7,975 11,445 9,150
---------------------------------------------------------------------
---------------------------------------------------------------------
Weighted average
number of
outstanding
common shares 13,697,024 13,644,256 13,678,257 13,605,136
Basic earnings
per share (Note 4e) 0.64 0.58 0.84 0.67
Diluted earnings
per share (Note 4e) 0.63 0.58 0.83 0.66



CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
For the six-month periods
ended July 1, 2005 and June 25, 2004
(in thousands of dollars) (unaudited)

Six-month periods
---------------------------------------------------------------------
2005 2004
---------------------------------------------------------------------
$ $
Balance at beginning, previously reported 73,489 62,243
Restatement for cash discounts - (247)
Restatement for stock-based compensation cost - (120)
---------------------------------------------------------------------
Balance at beginning, restated 73,489 61,876
Net earnings 11,445 9,150
Premium on common shares redemption (Note 4b) (540) (547)
Dividends on common shares (1,917) (1,638)
---------------------------------------------------------------------
Balance at end 82,477 68,841
---------------------------------------------------------------------
---------------------------------------------------------------------

The accompanying notes are an integral part of the consolidated
financial statements.



CONSOLIDATED BALANCE SHEETS
As at July 1, 2005 and December 31, 2004
(in thousands of dollars)
2005 2004
---------------------------------------------------------------------
$ $
(unaudited) (audited)
ASSETS
Current assets
Cash and cash equivalents - 64
Accounts receivable 52,449 31,668
Inventories 54,878 41,652
Prepaid expenses 8,414 6,234
Current portion of long-term receivables 593 652
---------------------------------------------------------------------
116,334 80,270
Long-term receivables 20 92
Property, plant and equipment 31,128 30,968
Deferred charges 8,665 7,363
Intangible assets 15,312 15,500
Goodwill 33,651 33,651
Future income taxes 515 841
Property held for sale (Note 3) - 2,048
---------------------------------------------------------------------
205,625 170,733
---------------------------------------------------------------------
---------------------------------------------------------------------

LIABILITIES
Current liabilities
Bank overdraft 5,850 -
Bank loan 15,000 129
Accounts payable and accrued liabilities 32,089 27,656
Income taxes 1,969 1,861
Current portion of long-term debt 2,375 4,750
---------------------------------------------------------------------
57,283 34,396
Long-term debt 7,625 5,250
Future income taxes 8,826 8,766
Deferred credits 416 435
Accrued benefit liability 720 694
Preferred Class B shares (Note 4a)) 3,800 3,800
---------------------------------------------------------------------
78,670 53,341
---------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Capital stock (Note 4a)) 44,083 43,600
Contributed surplus 395 303
Retained earnings 82,477 73,489
---------------------------------------------------------------------
126,955 117,392
---------------------------------------------------------------------
205,625 170,733
---------------------------------------------------------------------
---------------------------------------------------------------------

The accompanying notes are an integral part of the consolidated
financial statements.



CONSOLIDATED STATEMENTS OF CASH FLOWS
For the three-month and six-month periods
ended July 1, 2005 and June 25, 2004
(in thousands of dollars) (unaudited)

Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $

OPERATING ACTIVITIES
Net earnings 8,744 7,975 11,445 9,150
Adjustments for:
Depreciation and
amortization
(Note 5) 2,043 1,702 3,859 3,275
Future income taxes 453 235 386 667
Exchange loss (gain) 37 (31) 3 (8)
Loss (gain) on
disposal of assets 128 (3) 140 (19)
Employee future
benefit funding
(higher) lower than
expense (128) 417 26 793
Stock-based compensation
cost (Note 4c) 51 46 93 86
Net change in non-cash
working capital items
(Note 8) (3,674) (548) (31,647) (12,853)
---------------------------------------------------------------------
Cash flow from
(applied to)
operating activities 7,654 9,793 (15,695) 1,091
---------------------------------------------------------------------
INVESTING ACTIVITIES
Acquisitions of
property, plant
and equipment (1,207) (2,104) (2,226) (2,928)
Deferred charges (1,864) (1,450) (2,938) (2,681)
Proceeds from disposal
of property, plant
and equipment - 3 - 21
Proceeds from disposal
of property held
for sale 1,920 - 1,920 -
Long-term receivables - 53 72 563
---------------------------------------------------------------------
Cash flow applied
to investing
activities (1,151) (3,498) (3,172) (5,025)
---------------------------------------------------------------------
FINANCING ACTIVITIES
Bank loan (7,826) (7,099) 14,895 5,850
Issue of common
shares (Note 4b) 304 155 643 884
Redemption of
common shares (Note 4b) (525) (763) (701) (763)
Dividends on
common shares (960) (820) (1,917) (1,638)
---------------------------------------------------------------------
Cash flow
(applied to)
from financing
activities (9,007) (8,527) 12,920 4,333
---------------------------------------------------------------------
Net (decrease)
increase in cash
and cash equivalents (2,504) (2,232) (5,947) 399
Effect of exchange rate
changes on cash and cash
equivalents denominated
in foreign currency (20) 53 33 23
---------------------------------------------------------------------
(Decrease) increase
in cash and cash
equivalents (2,524) (2,179) (5,914) 422
(Bank overdraft) cash
and cash equivalents
at beginning (3,326) 4,005 64 1,404
---------------------------------------------------------------------
(Bank overdraft) cash
and cash equivalents
at end (5,850) 1,826 (5,850) 1,826
---------------------------------------------------------------------
---------------------------------------------------------------------
Supplementary information
Interest paid 301 404 546 819
Dividends paid
on preferred shares 41 38 82 79
Income taxes paid 1,438 1,816 4,933 3,730

The accompanying notes are an integral part of the consolidated
financial statements.



SICO INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the three-month and six-month periods
ended July 1, 2005 and June 25, 2004
(tabular amounts are in thousands of dollars, except share data)
(unaudited)

1. BASIS OF PRESENTATION

The consolidated financial statements for the three-month and six-
month periods ended July 1, 2005 and June 25, 2004, included in this
report are unaudited and have not been reviewed and reflect normal
and recurring adjustments, which are, in the opinion of the Company,
considered necessary for a fair presentation. These consolidated
financial statements have been prepared in accordance with Canadian
generally accepted accounting principles ("GAAP"). However, they do
not include all disclosures required under Canadian GAAP for annual
financial statements, and should be read in conjunction with the
consolidated financial statements and the notes thereto included in
the Company's latest Annual Report. The results of operations for the
interim periods should not be considered indicative of full year
results due to the seasonality of the business. These consolidated
financial statements follow the same accounting policies as in the
most recent annual consolidated financial statements for the year
ended December 31, 2004.

2. FINANCIAL INSTRUMENTS

Currency risk

The Company is exposed to currency risk as a result of its purchases
of raw material in American dollars. The risk is partially covered by
the export to the United States and Mexico of certain goods produced
in Canada. The Company may occasionally enter into forward exchange
contracts to reduce its currency risk. The following table presents
the forward exchange contracts outstanding as at July 1, 2005. Fair
values are estimated by obtaining quotes from financial institutions
as at July 1, 2005.

Value of the Average rate Nominal value Fair value of
forward of forward of forward forward
Forward exchange exchange exchange exchange
exchange contracts in contracts in contracts in contracts in
contracts' Canadian Canadian American American
maturities dollars dollars dollars dollars
---------------------------------------------------------------------
$ $ $ $
Three-month
period ending
September 30, 2005 5,308 1.2202 4,350 4,336
Three-month
period ending
December 30, 2005 5,600 1.2174 4,600 4,586
---------------------------------------------------------------------
10,908 1.2188 8,950 8,922
---------------------------------------------------------------------
---------------------------------------------------------------------

3. PROPERTY HELD FOR SALE

Following the operational infrastructure plan, the land and the
building where was established the customer service of Toronto were
classified as available for sale. On May 31, 2005, the Company sold
the property. A loss on disposal of assets of $128,000 was recorded
in "Cost of sales and operating expenses". The property was assigned
to the architectural segment.

4. CAPITAL STOCK

a) Issued
As at As at
July 1, 2005 December 31, 2004
---------------------------------------------------------------------
$ $
13,707,458 common shares
(13,627,772 as at
December 31, 2004) 44,083 43,600
---------------------------------------------------------------------
---------------------------------------------------------------------
2,763,638 Class B preferred shares,
classified as liabilities 3,800 3,800
---------------------------------------------------------------------
---------------------------------------------------------------------

On May 27, 2005, the Company split all its shares on a two-for-one
basis. All share and per share information in the consolidated
financial statements have been adjusted retroactively to reflect the
stock split.

b) Summary of common share transactions

Number Amount
---------------------------------------------------------------------
$
Shares issued, December 26, 2003 13,509,268 42,577
Exercise of stock options 162,890 900
Stock purchase plan for employees,
executives and directors 26,614 349
Redemption of shares (1) (71,000) (226)
---------------------------------------------------------------------
Shares issued, December 31, 2004 13,627,772 43,600
Exercise of stock options 129,686 644
Redemption of shares (1) (50,000) (161)
---------------------------------------------------------------------
Shares issued, July 1, 2005 13,707,458 44,083
---------------------------------------------------------------------
---------------------------------------------------------------------

(1) During the six-month period ended July 1, 2005, the Company
redeemed and cancelled 50,000 common shares (71,000 common
shares during the year ended December 31, 2004) for a net cash
consideration of $701,000 ($798,000 during the year ended
December 31, 2004), including redemption fees. The excess of
$540,000 ($572,000 during the year ended December 31, 2004) over
paid-up capital of the shares was recorded as a decrease in
retained earnings.

c) Stock option plan

Under the stock option plan for senior management of the Company, the
Board of Directors may, at its discretion, grant options to purchase
common shares of the Company to certain officers and designated
executives. The exercise price is established by the Board of
Directors but may not be lower than the closing price of a regular
lot of the Company's common shares on the Toronto Stock Exchange on
the last trading day preceding the grant date. Options vest over a
four-year period from the date of grant at a rate of 20% per year and
must be exercised within a ten-year period, except in the event of
retirement, termination of employment or death. As at July 1, 2005,
259,410 common shares (296,410 common shares as at December 31, 2004)
have been reserved for grant under this plan.

The following table gives details on changes to outstanding options:

For the six-month period For the year
ended July 1, 2005 ended December 31, 2004
--------------------------------------------------------------------
Weighted Weighted
average average
exercise exercise
Number of price Number of price
options per share options per share
--------------------------------------------------------------------
$ $
Outstanding at beginning 603,274 8.50 698,164 7.58
Granted 37,000 13.65 68,000 10.88
Exercised (129,686) 5.53 (162,890) 5.52
Cancelled (10,864) 10.91 - -
---------------------------------------------------------------------
Outstanding at end 499,724 9.44 603,274 8.50
---------------------------------------------------------------------
---------------------------------------------------------------------

The outstanding stock options granted to certain members of senior
management of the Company as at July 1, 2005 are as follows:

Weighted average
Weighted average remaining
Options exercise price contractual life
Options issued exercisable per share (years)
---------------------------------------------------------------------
$
2,000 2,000 4.44 0.1
5,998 5,998 3.28 1.1
66,000 66,000 5.25 1.8
40,084 40,084 6.63 2.1
16,624 16,624 8.00 3.6
22,452 22,452 8.75 4.1
252,766 95,356 11.00 7.9
56,800 22,000 10.88 8.9
27,000 5,400 13.38 9.7
10,000 2,000 14.38 9.9
---------------------------------------------------------------------
499,724 277,914 9.75 6.5
---------------------------------------------------------------------
---------------------------------------------------------------------

The stock-based compensation cost charged to earnings only reflects
the impact of the awards granted to employees after January 1, 2002.
The stock-based compensation cost has been calculated using the Black
and Scholes option pricing model using the following assumptions:

Options granted in
---------------------------------------------------------------------
May 10, 2005 March 2, 2005 May 15, 2004
---------------------------------------------------------------------
Weighted average fair
value of options at
the date of the grant $2.32 $2.27 $2.42
Assumptions:
Risk-free interest rate 3.23% 3.61% 3.77%
Dividend yield 1.94% 2.09% 2.20%
Expected volatility 16.40% 17.38% 25%
Expected life 5 years 5 years 5 years

The stock-based compensation cost charged to earnings for the awards
granted to employees is as follows:

Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $
51 46 93 86

The counterpart has been accounted for in the contributed surplus.

d) Stock purchase plan for employees, executives and directors

The stock purchase plan was set up to allow employees, executives and
directors of the Company to purchase shares of the Company's capital
stock. The subscription price of the common shares is equal to the
average market closing price during the last five days of trading
prior to the issue date of the common shares offered. Under the plan,
the maximum number of shares offered annually is 50,000 shares, and
the remaining number of shares available for issuance under the stock
purchase plan as at July 1, 2005 and as at December 31, 2004 is
166,134 shares.

e) Earnings per share

The following table sets forth the computation of basic and diluted
earnings per share:

For the three-month For the three-month
period ended period ended
July 1, 2005 June 25, 2004
---------------------------------------------------------------------
$ $
Numerator:
Net earnings 8,744 7,975
---------------------------------------------------------------------
Denominator:
Denominator for basic
earnings per share -
weighted average
number of shares 13,697,024 13,644,256
Dilutive effect of stock options (1) 151,627 162,882
---------------------------------------------------------------------
Denominator for diluted
earnings per share - weighted
average number of shares
and assumed conversions 13,848,651 13,807,138
---------------------------------------------------------------------
---------------------------------------------------------------------
Basic earnings per share 0.64 0.58
---------------------------------------------------------------------
---------------------------------------------------------------------
Diluted earnings per share 0.63 0.58
---------------------------------------------------------------------
---------------------------------------------------------------------

For the six-month For the six-month
period ended period ended
July 1, 2005 June 25, 2004
---------------------------------------------------------------------
$ $
Numerator:
Net earnings 11,445 9,150
---------------------------------------------------------------------
Denominator:
Denominator for basic
earnings per share -
weighted average
number of shares 13,678,257 13,605,136
Dilutive effect of
stock options (1) 152,351 185,330
---------------------------------------------------------------------
Denominator for diluted
earnings per share -
weighted average number
of shares and assumed
conversions 13,830,608 13,790,466
---------------------------------------------------------------------
---------------------------------------------------------------------
Basic earnings per share 0.84 0.67
---------------------------------------------------------------------
---------------------------------------------------------------------
Diluted earnings per share 0.83 0.66
---------------------------------------------------------------------
---------------------------------------------------------------------

(1) The calculation of the dilutive effects excludes the anti-
dilutive options that would not be exercised because their price
adjusted for the fair value of the unrecognized compensation cost
(for options granted on or after January 1, 2002) is higher than
the average market value of share for each of the periods shown.
The number of excluded options is 37,000 for the three-month and
six-month periods ended July 1, 2005 (329,540 options excluded
for the three-month and six-month periods ended June 25, 2004).

5. DEPRECIATION AND AMORTIZATION

Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $

Property, plant
and equipment 1,035 975 2,054 1,937
Deferred charges 924 643 1,636 1,169
Customer relationships 94 94 188 188
Deferred credits (10) (10) (19) (19)
---------------------------------------------------------------------
2,043 1,702 3,859 3,275
Amortization of deferred
charges applied as a
reduction of sales 250 136 388 243
---------------------------------------------------------------------
1,793 1,566 3,471 3,032
---------------------------------------------------------------------
---------------------------------------------------------------------

6. FINANCIAL EXPENSES

Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $
Interest on long-term debt 312 422 515 812
Other interest (1) (3) 14 12
Dividends on preferred
Class B shares 41 38 82 79
Foreign currency
translation loss (gain) 56 (48) 75 (36)
---------------------------------------------------------------------
408 409 686 867
---------------------------------------------------------------------
---------------------------------------------------------------------

7. RESEARCH EXPENSES

Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $

Research expenses 979 993 1,935 1,942
Tax credits (95) (88) (189) (176)
---------------------------------------------------------------------
884 905 1,746 1,766
---------------------------------------------------------------------
---------------------------------------------------------------------

Research expenses are included in "Cost of sales and operating
expenses". Some of these expenses qualify for tax credits, which are
applied against these expenses.

8. NET CHANGE IN NON-CASH WORKING CAPITAL ITEMS

Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $
Accounts receivable (6,941) (7,759) (20,780) (16,897)
Inventories (1,354) 2,081 (13,212) (4,126)
Prepaid expenses (982) 565 (2,179) 603
Accounts payable and
accrued liabilities 3,230 2,449 4,408 7,135
Income taxes 2,373 2,116 116 432
---------------------------------------------------------------------
(3,674) (548) (31,647) (12,853)
---------------------------------------------------------------------
---------------------------------------------------------------------

9. EMPLOYEE FUTURE BENEFITS

The Company maintains primarily defined benefit pension plans for
most of its employees. The other plans relate to other retirement
benefits, primarily life insurance, offered by the Company to its
employees. The net expense is included in cost of sales and operating
expenses.

The net expense recognized is as follows:

Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $

Pension plans 956 594 1,911 1,158
Other plans 52 43 104 89

10. SEGMENTED INFORMATION

The Company has two business units organized by products. The Company
assesses the performance of the business units based on the following
items: sales, operating earnings before depreciation and
amortization, financial expenses and income taxes and operating
earnings before financial expenses and income taxes. Each business
unit, except for the Head Office segment, includes activities related
to development, manufacturing, sales and distribution of paints and
coatings. Management of cash and cash equivalents, as well as other
activities related to the corporate strategies with regard to
manufacturing and market development are part of the Head Office
segment. The allocation of the expenses of this segment would not
assist in the evaluation of the contribution of the other segments.

The accounting policies used to determine results and measure
segmented assets are the same as those described in the most recent
annual consolidated financial statements.

Head
Architectural Industrial Office Total
$ $ $ $
--------------------------------------------------------------------
As at and for
the three-month
period ended
July 1, 2005
Sales 88,621 10,465 - 99,086
Operating earnings
before depreciation
and amortization,
financial expenses
and income taxes 18,074 697 (3,611) 15,160
Depreciation and
amortization 1,366 164 263 1,793
Operating earnings
before financial
expenses and
income taxes 16,708 533 (3,874) 13,367
Total assets 167,501 33,288 4,836 205,625
Acquisitions of
property, plant
and equipment 984 150 73 1,207

As at and for
the three-month
period ended
June 25, 2004
Sales 82,761(1) 11,594(1) - 94,355(1)
Restructuring expenses (62) (9) - (71)
Operating earnings
before depreciation
and amortization,
financial expenses
and income taxes 17,620(1) 155(1) (3,662)(1) 14,113(1)
Depreciation and
amortization 1,133 157 276 1,566
Operating earnings
before financial
expenses and
income taxes 16,487(1) (2)(1) (3,938)(1) 12,547(1)
Total assets 163,380(1) 36,291(1) 9,502(1) 209,173(1)
Acquisitions of
property, plant
and equipment 1,408 312 384 2,104


Head
Architectural Industrial Office Total
$ $ $ $
--------------------------------------------------------------------
As at and for
the six-month
period ended
July 1, 2005
Sales 148,150 18,981 - 167,131
Operating earnings
before depreciation
and amortization,
financial expenses
and income taxes 27,837 1,192 (8,093) 20,936
Depreciation and
amortization 2,613 329 529 3,471
Operating earnings
before financial
expenses and
income taxes 25,224 863 (8,622) 17,465
Total assets 167,501 33,288 4,836 205,625
Acquisitions of
property, plant
and equipment 1,646 449 131 2,226

As at and for
the six-month
period ended
June 25, 2004
Sales 136,280(1) 21,035(1) - 157,315(1)
Restructuring
expenses (62) (9) - (71)
Operating earnings
before depreciation
and amortization,
financial expenses
and income taxes 24,538(1) 634(1) (7,376)(1) 17,796(1)
Depreciation and
amortization 2,184 320 528 3,032
Operating earnings
before financial
expenses and
income taxes 22,354(1) 314(1) (7,904)(1) 14,764(1)
Total assets 163,380(1) 36,291(1) 9,502(1) 209,173(1)
Acquisitions of
property, plant
and equipment 1,932 402 594 2,928

Geographical Information

Three-month periods Six-month periods
---------------------------------------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
$ $ $ $
Sales
Canada 96,978 90,652(1) 162,792 149,850(1)
Other countries 2,108 3,703(1) 4,339 7,465(1)
---------------------------------------------------------------------
99,086 94,355(1) 167,131 157,315(1)
---------------------------------------------------------------------
---------------------------------------------------------------------


As at July 1, 2005
--------------------------------------------------------------------
Property,
Total plant and
assets equipment Goodwill
--------------------------------------------------------------------
$ $ $
Canada 196,391 30,357 27,680
United States 7,481 651 5,943
France 593 - -
Other countries 1,160 120 28
---------------------------------------------------------------------
205,625 31,128 33,651
---------------------------------------------------------------------
---------------------------------------------------------------------

As at June 25, 2004
--------------------------------------------------------------------
Property,
Total plant and
assets equipment Goodwill
--------------------------------------------------------------------
$ $ $
Canada 193,432(1) 33,908 27,749
United States 8,445 685 5,943
France 6,327 68 3,424
Other countries 969 143 28
---------------------------------------------------------------------
209,173(1) 34,804 37,144

---------------------------------------------------------------------
---------------------------------------------------------------------

(1) Restated as described in Note 3 and Note 31 of the most recent
annual consolidated financial statements.

11. WEATHER AND SEASONALITY

Exterior architectural paint products are subject to specific
application requirements related to weather conditions. The sales of
such products, which account for approximately 20% of the paint sales
of the Company's Architectural Sector, are dependent upon weather
conditions and may be materially adversely affected by unfavourable
weather conditions continuing for several days or several weeks.

Furthermore, the sale of exterior products is seasonal in nature.
Sales of such products in the second and third quarters are
historically significantly higher than sales in the first and fourth
quarters and, consequently, net earnings are significantly higher in
those quarters. Variable costs may be managed according to the
seasonal pattern. However, a significant portion of the Company's
costs may not be adjusted for seasonality.

12. COMPARATIVE FIGURES

Certain comparative figures have been reclassified in order to
conform to the presentation adopted in 2005.


Contact Information

  • SICO INC.
    Pierre Dufresne,
    President and Chief Executive Officer
    (514) 527-5111
    or
    SICO INC.
    Jean Ouellet, CA,
    Vice President, Finance and Treasurer
    (514) 527-5111
    www.sico.com