ARBOR ANNOUNCES SECOND QUARTER RESULTS
TSX ABO.A and ABO.B
TORONTO, June 9, 2011 /CNW/ - Arbor Memorial Services Inc. announced today its results for the 13 and 26 weeks ended May 1, 2011 and April 25, 2010.
|13 weeks ended||26 weeks ended|
|Earnings before interest expense and income|
|taxes ("EBIT" - a non-GAAP measure)||8.9||8.8||16.5||17.3|
|Net earnings from continuing operations||6.0||5.9||11.3||11.1|
|Basic and diluted earnings per share|
|from continuing operations ($)||0.57||0.55||1.07||1.04|
|Basic and diluted earnings per share ($)||0.58||0.55||1.08||1.04|
(1) Restated to conform with the current year's presentation.
Revenue for the second quarter of 2011 decreased by $1.8 million or 2.7% from 2010. Sales in the cemetery division decreased by $3.7 million or 12.2% due primarily to lower sales of pre-need interment rights of $4.4 million or 35.3%, which was partially offset by higher deliveries of pre-need memorials of $0.7 million or 20.3%. The decrease in sales of pre-need interment rights was primarily due to the availability of new crypt inventory at one cemetery branch operation in 2010 and the implementation of a harmonized sales tax ("HST") in Ontario and British Columbia in 2010 that caused many customers to make their pre-need arrangements in advance of the transition date. Sales in the funeral division increased by $2.0 million or 6.3% due to higher sales from new operations of $1.2 million, a higher average sale per service for existing operations of 2.2% and an increase in the number of services performed by existing operations of 0.3%. Investment and other income decreased by $0.1 million or 1.5% due mainly to lower funeral referral fee income.
EBIT (a non-GAAP measure) for the second quarter increased by $0.1 million or 0.9% from 2010 due to higher earnings in the cemetery division of $0.2 million or 5.8%, which was partially offset by an increase in the loss of the corporate division of $0.1 million or 2.5%.
Net earnings for the second quarter increased by $0.2 million or 4.3% from 2010 to $6.0 million. The increase was primarily the result of lower income taxes.
Revenue for the first 26 weeks of 2011 decreased by $3.3 million or 2.5% from 2010. Sales in the cemetery division decreased by $6.4 million or 11.0%, due primarily to lower sales of pre-need interment rights. The decrease in sales of pre-need interment rights was primarily due to the implementation of HST in Ontario and British Columbia in 2010, the availability of new crypt inventory at one cemetery branch operation in 2010 and reduced availability of crypt inventory at one branch operation in 2011. Sales in the funeral division increased by $2.9 million or 4.6% due to an increase in the number of services performed by existing operations of 1.6%, a higher average sale per service for existing operations of 0.6% and higher sales from new operations of $1.5 million. Investment and other income increased by $0.2 million or 1.7% due mainly to higher cemetery care fund interest and dividends as a result of a higher average balance in the funds.
EBIT (a non-GAAP measure) for the first 26 weeks of 2011 decreased by $0.8 million or 4.8% from 2010 as a result of lower EBIT in the cemetery division of $1.0 million or 13.2% due to lower sales and an increase in the loss of the corporate division of $0.2 million or 2.2%, which were partially offset by higher EBIT of $0.3 million or 1.9% in the funeral division.
Net earnings for the first 26 weeks of 2011 increased by $0.3 million or 2.3% from 2010 to $11.3 million. The improvement was due to lower income taxes of $1.1 million or 20.3%, which were partially offset by a decrease in EBIT of $0.8 million or 4.8%. Excluding other income (expense), net earnings (loss) from discontinued operations and future tax adjustments related to substantively enacted tax rate changes, net earnings declined by $0.4 million or 3.3%, which was primarily due to lower sales in the cemetery division.
In addition to the GAAP results provided in this press release, some of the discussion of operating performance is based on EBIT. EBIT excludes the impact of interest expense and income taxes as disclosed in the statements of earnings. EBIT is a non-GAAP financial measure that does not have any standardized meaning prescribed by GAAP and is therefore unlikely to be comparable to similar measures presented by other companies. This non-GAAP financial measure is more fully defined and discussed in the management discussion and analysis of Arbor Memorial Services Inc. for the year ended October 31, 2010, available on the SEDAR website at www.sedar.com.
Arbor Memorial Services Inc. owns 41 cemeteries, 28 crematoria, 7 reception centres located on cemetery premises and 85 funeral homes in eight provinces of Canada.
For further information:
Brian D. Snowdon, President and Chief Executive Officer
Laurel L. Ancheta, Vice-President and Chief Financial Officer
Telephone: (416) 763-4531