Uni-Sélect Inc.

Uni-Sélect Inc.

March 16, 2005 11:07 ET

Uni-Select Inc. Increases its Profits by 24.9% in the Fourth Quarter of 2004


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: UNI-SELECT INC.

TSX SYMBOL: UNS

MARCH 16, 2005 - 11:07 ET

Uni-Select Inc. Increases its Profits by 24.9% in the
Fourth Quarter of 2004

BOUCHERVILLE, QUEBEC--(CCNMatthews - March 16, 2005) - Uni-Select Inc.
(TSX:UNS) announces its financial results for the fourth quarter of 2004
and for the year ended December 31, 2004. Net earnings in the fourth
quarter increased by 24.9% to reach $12,392,000 or $0.64 per share after
dilution, compared to $9,923,000 or $0.54 per share in the fourth
quarter of 2003. Net earnings for the year were reported at $30,935,000
or $1.65 per share after dilution, compared to $31,386,000 or $1.70 per
share in 2003. These 2003 earnings included a non-recurring income of
$4,466,000 or $0.24 per share resulting from a judgement in favour of
Uni-Select Inc. Excluding the non-recurring income of 2003, Uni-Select
increased its profitability in 2004 by 14.9% over the preceding year.

Sales in the fourth quarter of the year totalled $229,718,000, an
increase of 35.8% compared to sales of $169,142,000 realized in the last
quarter of 2003. As a result, sales for the year totalled $788,236,000,
an increase of 9.4% compared to sales of $720,624,000 in 2003.

Automotive Group Canada increased its sales by 0.6% during the course of
the fourth quarter of 2004, an increase resulting essentially from
organic growth. In the fourth quarter, sales for Automotive Group
Canada reached $116,154,000 compared to $115,446,000 for the
corresponding period a year earlier. For the 2004 year, sales of the
Group totalled $503,870,000 compared to $492,075,000 in 2003, a 2.4%
increase largely due to organic growth of the Group. The operating
margin of Automotive Group Canada during the course of the fourth
quarter was reported at 11.2%, compared to 10.3% in the same quarter of
2003 by reason of larger profits recorded on inventory. For the year,
the operating margin of the Group increased from 6.8% in 2003 to 7.2% in
2004. This increase is also attributable to larger profits on inventory
as well as to the continued improvement of our buying conditions and
customer mix.

Automotive Group USA increased its sales by 156.2% in the fourth quarter
of 2004, going from $36,046,000 in the fourth quarter of 2003 to
$92,334,000 in 2004. This increase stems from the acquisition of Middle
Atlantic Warehouse Distributor, Inc. ("MAWDI") completed on November 1,
2004. Excluding this acquisition, the quarterly sales of the Group
would have decreased by 13.4% as a result of the negative impact of the
exchange rate and weaker sales in the Pacific Northwest and Central USA.
For the 2004 year, sales increased by 23.6% going from $169,120,000 in
2003 to $209,071,000 in 2004. This increase is also attributable to the
November 2004 acquisition. Excluding this acquisition, annual sales of
the Group would have decreased by 12.5% for the same reasons as those
for the quarter. The Group's operating margin during the course of the
fourth quarter was 4.8%, compared to 7.5% in the fourth quarter of 2003.
This reduction in operating margin is due to the lower margins of the
acquired entities and to the reduction in volume of the other
operations. For the year, the operating margin of the Group decreased
to 5.2%, compared to 5.8% in 2003. This variation is also due to
acquired entities. The operating margin of all entities, excluding
MAWDI, remained stable at 5.8%.

The Heavy Duty Group increased its sales by 20.3% in the fourth quarter
to reach $21,230,000 compared to $17,650,000 in the last quarter of
2003. This growth is shared between the contribution generated from the
acquisition concluded at the beginning of 2004 and solid organic growth.
For the 2004 year, sales of the Group increased by 26.7% going from
$59,429,000 to $75,295,000. This progress stems from the same sources
as those of the fourth quarter. The Heavy Duty Group's operating margin
in the fourth quarter was 9.0%, compared to 8.3% in the same quarter of
2003. For the year, the operating margin of the Group increased to
5.2%, compared to 4.8% in 2003. The improvement of the margin for both
the quarter and the year, is largely due to better buying conditions
resulting from the strength of the Canadian dollar.

"Management is pleased with the contribution of our new operations in
the United States" said Mr. Jacques Landreville, President and Chief
Executive Officer of Uni-Select. "Although results were only impacted
for a short period in 2004, we are, nevertheless, able to appreciate
their potential. We must, as we are in the habit of doing, ensure that
all synergies are met in order to materialize full value. We are
confident in our success thanks to the quality and determination of our
new partners."

Finally, the Board of Directors of Uni-Select declared a quarterly
dividend of $0.08 per common share payable on April 21, 2005 to
shareholders of record as at March 31, 2005.

Uni-Select is Canada's second largest distributor of automotive and
heavy-duty replacement parts, equipment, tools and accessories. Through
Uni-Select USA, Inc., the company also provides service to customers in
the United States where it is the 8th largest distributor. The
Uni-Select Network includes over 800 independent jobbers in Canada and
almost 2,000 in the United States. Uni-Select is headquartered in
Montreal and is expected to generate revenues in excess of CDN$1.1
billion in 2005. Uni-Select shares (UNS) are traded on the Toronto
Stock Exchange (TSX).



UNI-SELECT INC.
CONSOLIDATED EARNINGS

THREE-MONTH AND TWELVE-MONTH PERIODS ENDED DECEMBER 31, 2004 AND 2003
(IN THOUSANDS OF DOLLARS, EXCEPT NET EARNINGS PER SHARE)


AUDITED

FOURTH QUARTER 12 MONTHS
2004 2003 2004 2003
--------------------------------------------------------------------
$ $ $ $
SALES 229,718 169,142 788,236 720,624
--------------------------------------------------------------------

Earnings before the
following 19,303 16,103 50,906 46,389
--------------------------------------------------------------------

Interest on bank
indebtedness 133 111 492 757
Interest on
long-term debt 378 5 391 21
Interest on merchant
members' deposits in
guarantee funds 21 75 221 240
Interest income on cash and
cash equivalent and short
term investment (27) (337) (430) (807)
Interest income from
merchant members (85) (74) (322) (292)
Depreciation of
fixed assets 1,470 901 5,109 4,582
--------------------------------------------------------------------
1,890 681 5,461 4,501
--------------------------------------------------------------------
Earnings before other incomes,
income taxes and
Non-controlling interest 17,413 15,422 45,445 41,888
Other incomes - (479) - 6,567
--------------------------------------------------------------------

Earnings before income taxes
and non-controlling
interest 17,413 14,943 45,445 48,455
Income taxes
Current 6,229 5,052 15,487 34,074
Future (1,556) (257) (1,861) (17,790)
--------------------------------------------------------------------
4,673 4,795 13,626 16,284
--------------------------------------------------------------------

Earnings before
non-controlling
interest 12,740 10,148 31,819 32,171
Non-controlling interest 348 225 884 785
--------------------------------------------------------------------

Net earnings 12,392 9,923 30,935 31,386
--------------------------------------------------------------------
--------------------------------------------------------------------

Net earnings per share 0.65 0.54 1.67 1.72
--------------------------------------------------------------------
--------------------------------------------------------------------

Diluted net earnings
per share 0.64 0.54 1.65 1.70
--------------------------------------------------------------------
--------------------------------------------------------------------

--------------------------------------------------------------------
Weighted number of
outstanding share 19,058,699 18,344,557 18,539,196 18,273,595
--------------------------------------------------------------------
Number of issued and
outstanding common
shares 19,423,289 18,347,758 19,423,289 18,347,758
--------------------------------------------------------------------



UNI-SELECT INC.
CONSOLIDATED CASH FLOWS

THREE-MONTH AND TWELVE-MONTH PERIODS ENDED DECEMBER 31, 2004 AND 2003
(IN THOUSANDS OF DOLLARS)


AUDITED

FOURTH QUARTER 12 MONTHS
2004 2003 2004 2003
--------------------------------------------------------------------
$ $ $ $
OPERATING ACTIVITIES
NET EARNINGS 12,392 9,923 30,935 31,386
NON-CASH ITEMS
Depreciation and
amortization 1,470 901 5,109 4,582
Future income taxes (1,556) (257) (1,861) (17,790)
Non-controlling interest 348 225 884 785
--------------------------------------------------------------------
12,654 10,792 35,067 18,963
Changes in working
capital items (1,909) (8,114) (26,876) 71,723
--------------------------------------------------------------------
10,745 2,678 8,191 90,686
--------------------------------------------------------------------
INVESTING ACTIVITIES
Temporary investments - (7,981) 32,359 (32,359)
Business acquisitions (107,962) (259) (120,344) (24,363)
Disposal of assets - 32 1,212 88
Balance of sale
price receivable 82 - 290 -
Non-controlling interest - - - (203)
Advances to joint ventures - 270 3,596 (3,711)
Advances to
merchant members (1,002) (1,059) (5,899) (3,633)
Reimbursement of
advances to merchant
members 962 853 2,757 3,109
Company Shares - - - (21)
Disposal of property,
plant and equipment 22 27 115 95
Property, plant
and equipment (1,465) (1,563) (5,473) (4,426)
--------------------------------------------------------------------
(109,363) (9,680) (91,387) (65,424)
--------------------------------------------------------------------
FINANCING ACTIVITIES
Bank indebtedness 1,700 1,268 (4,954) (22,752)
Due to a joint venture - - - 2,500
Balance of purchase price - (273) (36) (277)
Financing expenses (1,437) - (1,437) -
Long term debt 63,717 24 63,717 83
Reimbursement of
long-term debt (52) (39) (147) (155)
Merchant members'
deposits in guarantee
funds (314) (43) (93) 75
Issuance of shares 28,081 83 28,643 1,534
Share issue expenses (32) - (32) -
Share redemption - - - -
Stock options settled
for cash - - - -
Dividends paid (1,351) (1,226) (6,181) (4,692)
--------------------------------------------------------------------
90,312 (206) 79,480 (23,684)
--------------------------------------------------------------------
Net increase in cash
and cash equivalent (8,306) (7,208) (3,716) 1,578
Cash and cash
equivalent, beginning
of period 18,227 20,845 13,637 12,059
--------------------------------------------------------------------
Cash and cash
equivalent, end
of year 9,921 13,637 9,921 13,637
--------------------------------------------------------------------
--------------------------------------------------------------------

Cash and cash equivalent
are made up of cash and
banker's acceptances
less than three months.
Dividends paid on
common shares 0.1470 0.1340 0.3365 0.2570
--------------------------------------------------------------------


CONSOLIDATED RETAINED EARNINGS

TWELVE-MONTH PERIODS ENDED DECEMBER 31, 2004 AND 2003
(IN THOUSANDS OF DOLLARS)

2004 2003
AUDITED
--------------------------------------------------------------------
$ $

Balance, beginning of year 164,591 138,014
Change in accounting policies (955) (861)
--------------------------------------------------------------------
163,636 137,153
Net earnings 30,935 31,386
--------------------------------------------------------------------
194,571 168,539
Common share issue expenses 32 -
Dividends 6,380 4,903
--------------------------------------------------------------------
6,412 4,903
--------------------------------------------------------------------
Balance, end of year 188,159 163,636
--------------------------------------------------------------------
--------------------------------------------------------------------


UNI-SELECT INC.
CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS OF DOLLARS) DECEMBER 31, DECEMBER 31,
2004 2003
AUDITED
$ $
--------------------------------------------------------------------

ASSETS
CURRENT ASSETS
Cash and cash equivalent 9,921 13,637
Temporary investments - 32,359
Accounts receivable 137,525 99,417
Inventory 261,413 124,692
Prepaid expenses 3,496 2,269
Future income taxes 5,488 1,629
--------------------------------------------------------------------
417,843 274,003
Investments and volume discounts
receivable, AT COST 8,309 5,292
Property, plant and equipment 33,585 27,447
Consolidated goodwill 18,273 9,544
Deferred financing expenses 1,384
Future income taxes 3,056 1,446
--------------------------------------------------------------------
482,450 317,732
--------------------------------------------------------------------
--------------------------------------------------------------------

LIABILITIES
CURRENT LIABILITIES
Bank indebtedness 3,193 8,581
Accounts payable 154,323 115,668
Dividends payable 1,428 1,229
Instalments on long-term debt
and merchant Members' deposits
in guarantee fund 477 236
--------------------------------------------------------------------
159,421 125,714
Deferred government grant 421 518
Long-term debt 63,230 282
Merchant member's deposits in
guarantee funds 7,452 7,681
Future income taxes 3,935 3,235
Non-controlling interest 24,125 6,547
--------------------------------------------------------------------
258,584 143,977
--------------------------------------------------------------------

SHAREHOLDERS' EQUITY
Capital stock 45,601 16,958
Cumulative translation adjustments (9,894) (6,839)
Retained earnings 188,159 163,636
--------------------------------------------------------------------
223,866 173,755
--------------------------------------------------------------------
482,450 317,732
--------------------------------------------------------------------
--------------------------------------------------------------------



UNI-SELECT INC.
INFORMATIONS BY BUSINESS UNITS
--------------------------------------------------------------------
THREE-MONTH PERIODS ENDED DECEMBER 31, 2004 AND 2003
(IN THOUSANDS OF DOLLARS)

-------------------------------------------------------------------
Automotive Canada Automotive USA
-------------------------------------------------------------------
2004 2003 2004 2003
$ $ $ $
-------------------------------------------------------------------
SALES 116,154 115,446 92,334 36,046

Earnings before interest,
amortization, other
incomes, incomes taxes
and non-controlling
interest 12,994 11,928 4,398 2,710

Assets 189,352 226,419 252,154 64,203

Capital expenditures 1,098 1,437 6,224 95
-------------------------------------------------------------------

Consolidated goodwill - 19 5,022 -
-------------------------------------------------------------------



Heavy Duty Consolidated
-------------------------------------------------------------------
2004 2003 2004 2003
$ $ $ $
-------------------------------------------------------------------
SALES 21,230 17,650 229,718 169,142

Earnings before interest,
amortization, other
incomes, incomes taxes
and non-controlling
interest 1,911 1,465 19,303 16,103

Assets 40,944 27,110 482,450 317,732

Capital expenditures 202 60 7,524 1,592
-------------------------------------------------------------------

Consolidated goodwill - - 5,022 19
-------------------------------------------------------------------




UNI-SELECT INC.
INFORMATIONS BY BUSINESS UNITS
-------------------------------------------------------------------
TWELVE-MONTH PERIODS ENDED DECEMBER 31, 2004 AND 2003
(IN THOUSANDS OF DOLLARS)

-------------------------------------------------------------------
Automotive Canada Automotive USA
-------------------------------------------------------------------
2004 2003 2004 2003
$ $ $ $
-------------------------------------------------------------------
SALES 503,870 492,075 209,071 169,120

Earnings before interest,
amortization, other
incomes, incomes taxes
and non-controlling
interest 36,137 33,628 10,886 9,881

Assets 189,352 226,419 252,154 64,203

Capital expenditures 4,704 3,800 6,525 2,494
-------------------------------------------------------------------

Consolidated goodwill 1,337 37 5,022 -
-------------------------------------------------------------------





-------------------------------------------------------------------
Heavy Duty Consolidated
-------------------------------------------------------------------
2004 2003 2004 2003
$ $ $ $
-------------------------------------------------------------------
SALES 75,295 59,429 788,236 720,624

Earnings before interest,
amortization, other
incomes, incomes taxes
and non-controlling
interest 3,883 2,880 50,906 46,389

Assets 40,944 27,110 482,450 317,732

Capital expenditures 677 162 11,906 6,456
-------------------------------------------------------------------

Consolidated goodwill 3,140 - 9,499 37
-------------------------------------------------------------------


-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Uni-Select Inc.
    Jacques Landreville
    President and Chief Executive Officer
    (450) 641-6904
    or
    Uni-Select Inc.
    Richard G. Roy
    Vice President, Administration and Chief Financial Officer
    (450) 641-6904
    www.uni-select.com