MONTRÉAL, Dec. 14,
2022 /CNW Telbec/ -
Results
For the third quarter ended October 31,
2022, the Company's revenues decreased by $52,630,000 to $570,157,000 compared to $622,787,000 recorded for the third quarter ended
October 31, 2021, a 8.5% decrease.
Net earnings for the third quarter ended October 31, 2022, amounted to $28,900,000 compared to $59,351,000 recorded for the third quarter ended
October 31, 2021. Basic net earnings
per share amounted to $0.87 compared
to $1.76 recorded for the third
quarter ended October 31, 2021.
For the third quarter ended October 31,
2022, the share repurchase program contributed to an
increase of $0.02 on basic net
earnings per share, whereas during the third quarter ended
October 31, 2021, it contributed to
an increase of $0.01 on basic net
earnings per share.
The Company met the eligibility criteria for the Canadian
Emergency Wage Subsidy (CEWS) during the last quarter ended
April 30, 2021. The Company
received $1,439,000 after-tax which
contributed to an increase of $0.04
on basic net earnings per share.
The variation in adjusted net earnings would be ($29,012,000) or ($0.87) per basic share for the third quarter
ended October 31, 2022, as well as
the comparable period ended October 31,
2021, are explained as follows:
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(Unaudited and $ in
thousands)
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October 31,
2022
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October 31,
2021
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Net earnings
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28
900
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59 351
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CEWS
(after-tax)
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-
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(1 439)
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Adjusted net
earnings
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28
900
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57 912
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Minus: Adjusted net
earnings for 2021
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57
912
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Variation
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(29
012)
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The variations in net adjusted earnings are allocated as
follows:
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(Unaudited and $ in
thousands)
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Increase
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Increase
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Increase
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(decrease)
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(decrease)
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(decrease)
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in adjusted
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in retail
operations
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in
investment
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net earnings
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As at April 30,
2022
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1 670
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(10 098)
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(8 428)
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As at July 31,
2022
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(6 428)
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(8 009)
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(14 437)
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As at October 31,
2022
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(6 091)
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(56)
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(6 147)
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Total
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(10
849)
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(18
163)
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(29
012)
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Annual financial information
($ in thousands, except
for per share amounts)
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January 31,
2022
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January 31,
2021
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$
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$
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Revenue
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819
445
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649 056
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Net earnings
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81
931
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54 842
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Total assets
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549
926
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450 207
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Net earnings per share
basic and diluted
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2,43
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1,61
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Dividends per
share
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0,34
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0,29
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Financial position and dividends
Cash and investments decreased by $5,902,000 during the third quarter ended
October 31, 2022. Investments consist
of treasuries bearing interest, government and corporate bonds and
common shares, which at the close of the quarter had a market value
of $231,424,000 (including cash).
As at October 31, 2022, the
working capital showed a surplus of $24,286,000 an increase of $24,655,000 compared to the year ended
January 31, 2022. The Company's
shareholders' equity increased from $387,866,000 as at January
31, 2022, to $407,109,000 as
at October 31, 2022. As at
October 31, 2022, the book value per
share stood at $12.27, compared to
$11.60 as at January 31, 2022.
Pursuant to the normal course issuer-bid put in place on
April 15, 2021, and renewed on
April 15, 2022, accordingly, 251,000
common shares were repurchased and cancelled by the Company. As a
result of this change, the Company had as at October 31, 2022, 33,172,000 common shares issued
and outstanding.
During the third quarter ended October
31, 2022, no options were granted. The Company may still
grant pursuant to the Plan a total of 5,710,864 options,
representing 17.22% of the issued and outstanding shares of the
Company.
A semi-annual eligible dividend of $0.18 per Common Share has been declared to
holders registered at the close of business on December 22, 2022, which will be paid on
January 5, 2023.
Quarterly results *
(Unaudited and $ in thousands,
except for per share amounts)
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April
30,
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April 30,
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July
31,
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July 31,
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2022
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2021
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2022
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2021
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$
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$
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$
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$
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Revenue
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175
659
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177 208
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218
939
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231 624
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Net earnings
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807
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10 479
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14
246
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28 683
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Net basic earnings per
share
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0,02
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0,31
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0,43
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0,85
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October
31,
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October 31,
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January
31,
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January 31,
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2022
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2021
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2022
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2021
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$
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$
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$
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$
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Revenue
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175
559
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213 955
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196
658
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178 286
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Net earnings
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13
847
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20 189
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22
580
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26 915
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Net basic earnings per
share
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0,42
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0,60
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0,67
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0,79
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For the three month period ended October
31, 2022, the Company's revenues decreased by $38,396,000 to $175,559,000, compared to $213,955,000 recorded for the corresponding 2021
period, a 18% decrease. Net earnings for the three month
period ended October 31, 2022,
amounted to $13,847,000 compared to
$20,189,000 recorded for the
corresponding 2021 period. Basic net earnings per share decreased
to $0.42 compared to $0.60 for the corresponding 2021 period.
For the three month period ended October
31, 2022, the share repurchase program contributed to an
increase of $0.01 on basic net
earnings per share, whereas during the corresponding period ended
October 31, 2021, it had no impact on
basic net earnings per share.
The Company met the eligibility criteria for the Canadian
Emergency Wage Subsidy (CEWS) during the first quarter ended
October 31, 2021. The Company
received $195,000 after-tax.
The variation in adjusted net earnings would be ($6,147,000) or ($0.19) per basic share for the three month
period ended October 31, 2022, as
well as the comparable period October 31,
2021, are explained as follows:
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(Unaudited and $ in
thousands)
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October 31,
2022
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October 31,
2021
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Net earnings
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13
847
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20 189
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CEWS
(after-tax)
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-
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(195)
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Adjusted net
earnings
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13
847
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19 994
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Minus: Adjusted net
earnings for 2021
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19
994
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Variation
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(6
147)
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Operations
BMTC Group Inc.
On September 12th, 2022, the
Company started the migration of a single IT system for all of its
banners. We are pleased to announce that the IT system
implementation and integration process, including its e-commerce
platform, was successfully completed on December 5th, 2022, and is fully operational. We
are very proud of our IT employees who delivered ahead of schedule,
as was reported in our last management report roll out was planned
by the end of the year. All our employees have received complete
training on our new system and in this very short period of being
fully operational, we can already notice important value added as
well as time and cost efficiencies.
This IT standardisation has allowed the Company to create
significant operational synergies. We have now completed the merged
of our administrative and operational services of Brault &
Martineau, EconoMax and Tanguay banners and therefore created broad
and diversified teams that are better able to cope with the
realities of business today. During the next few months of
operating with only one IT system and e-commerce platform, we will
continue to review our administrative and operational services and
we believe we will be able to improve our efficiency and be even
more cost effective.
These important changes come at an opportune time for the
Company. The difficulty of obtaining skilled labour, the retail
trade that is constantly changing and evolving, the competition
that is now spread across Canada
and the United States of America
and the shift of consumer spending towards e-commerce means that
this change will allow the Company to be much more agile in its
business decisions. We believe that the IT standardisation as well
as the organisational and structural changes will enable the
Company to maintain its leadership in its market, as well as
significantly improve its profitability and financial structure and
continue its objectives of increasing its market share in
Quebec.
The company entered into a partnership agreement for the
development of its property at 500 boulevard Le Corbusier in Laval into several residential rental towers.
The Company created a new subsidiary, Le
Corbusier-Concorde S.E.C. for this real estate project on
January 31st, 2022. We are still
negotiating and waiting for permits with the city of Laval for this project. Once we obtain the
green light form the city of Laval, we will therefore be able to disclose
the full extent of this real estate development.
The Company has entered into an agreement for the sale of its
distribution centre in Montreal
for an amount of $66,500,000
resulting in an after-tax gain of $50,962,000. The Company has proceeded with a
lease back agreement for 2 years and with an option of renewing the
lease. The closing of this transaction is subject to certain
customary conditions and is expected to occur in February 2023.
Management discussion and outlook for the Future of the
Company
The Company continues to focus on online sales, which
experienced a record increase since the start of the pandemic in
2020, by actively pursuing the improvement of its digital
platforms, its live chat initiative with online customers as well
as the improvement of our telephone sales department for all of the
BMTC Group Inc. banners.
It is also Management's opinion that the digital platforms of
our banners are essential in order to allow the Company to increase
its market shares as well as to allow customers to start their
shopping experience online to then complete their purchases in one
of our stores with the help of our sales representatives.
Since mid-June 2021, the Company
has had issues with its supply logistics. Many of the Company's
suppliers, who have also been affected by the consequences of
COVID-19, are unable to honour and deliver placed orders. This
problem seems widespread in our industry and is not unique to the
Company.
It is difficult to predict the future level of consumer
spending, although we are now seeing that the Company's
results in the last quarter are not reflecting the performance of
the last two years. This downward trend continued in subsequent
months. We can therefore expect a significant drop, around 20% if
the trend continues. This is partly explained by the high rate
of inflation in terms of the cost of food, the cost of gas and the
rise in interest rates, which has a direct impact on consumer
spending. Also, management is aware that the increase in the last
two years was partly due to the fact that the Company benefited
from a transfer of consumer spending related to the restrictions
imposed by the various levels of government due to COVID-19
pandemic, more precisely the restrictions related to travel, the
closure of restaurants and all other forms of entertainment in the
cultural and sporting world. Since these restrictions are no longer
in place, consumer spending has in part transfer back to these
types of spending.
Caution regarding forward-looking statements
This press release contains certain forward-looking statements
with respect to the Company. These forward-looking statements are
identified by the use of terms and phrases such as "anticipate",
"believe", "estimate", expect", "intend", "may", "plan", "predict",
"project", "will", "would", as well as the opposites of these terms
and similar terminology, including references to assumptions.
Forward-looking statements, by their nature, necessarily involve
risks and uncertainties that could cause actual results to differ
materially from those contemplated by these forward-looking
statements. Results indicated in forward-looking statements may
differ materially from actual results for a number of reasons,
which the Company has identified in the 2022 Annual Information
Form under "Narrative Description of the Business - Risk Factors",
and other risks detailed from time to time in the Company's
continuous disclosure documents.
The reader is cautioned that the factors we refer above are not
exhaustive of the factors that may affect any of the Company's
forward-looking statements. The reader is also cautioned to
consider these and other factors carefully and not to put undue
reliance on forward-looking statements.
The Company made a number of assumptions in making
forward-looking statements in this press release. The Company
considers the assumptions on which these forward-looking statements
are based to be reasonable.
These statements reflect current expectations regarding future
events and operating performance and speak only as of the date of
release of this press release and represent the Company's
expectations as of that date. The Company disclaims any intention
or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
other than as required by law.
Non International Financial Reporting Standards (IFRS)
financial measures
The Company discloses adjusted net earnings, which includes or
excludes certain amounts that are not considered representative of
the performance measures and financial recurrence of the Company.
Management believes that this measure is useful in understanding
and analyzing the operational performance of the Company and that
it can provide additional information.
Adjusted net earnings as well as same store revenues are not an
earnings measure recognized by IFRS and do not have a standardized
meanings prescribed by IFRS. Therefore, adjusted net earnings and
same store revenues as discussed in this press release may not be
compared to similar measures presented by other issuers. These
measures of performance should not be considered as alternatives to
indicators of performance calculated according to IFRS, but rather
as a source of additional information.
The Company discloses in this press release under the section
"Results" a reconciliation between net earnings and adjusted net
earnings.
BMTC Group Inc.'s Common Shares are listed on the Toronto Stock
Exchange and through its subsidiaries Ameublements Tanguay Inc.,
Le Corbusier-Concorde S.E.C. and its
two divisions, Brault & Martineau and EconoMax, the Company is
a major retailer of furniture, electronic goods and household
appliances operating in the province of Quebec.
SOURCE BMTC Group Inc.