Canada Bread Reports Results for the Third Quarter 2013

TSX: CBY

TORONTO, Oct. 30, 2013 /CNW/ - Canada Bread Company, Limited (TSX: CBY) today reported its financial results for the third quarter ended September 30, 2013. Third quarter highlights include:

  • Adjusted Operating Earnings(1)(2) increased 16.7% to $38.9 million compared to $33.3 million last year. Year-to-date Adjusted Operating Earnings increased 19.0% to $92.5 million compared to $77.7 million last year
  • Net earnings(1) for the quarter increased to $24.5 million compared to $23.5 million last year. For the first nine months, net earnings increased to $51.3 million from $49.8 million last year.
  • Adjusted Earnings per Share(1)(3) for the quarter was $1.10, up from $0.93 in the third quarter of 2012. For the first nine months, Adjusted Earnings per Share was $2.60, up from $2.18 last year.
  • The Company achieved an Adjusted EBITDA(4) margin of 13.2% in the third quarter

"The business delivered solid earnings growth in the third quarter, benefiting from a very strong focus on efficiency gains, cost reduction and innovative new products," said Richard Lan, President and CEO.  "We are realizing some of the benefits of our strategic initiatives already implemented and moving forward with others to realize this potential."

Financial Overview

Canada Bread Company, Limited ("the Company") sales for the third quarter decreased 2.2% to $392.5 million compared to $401.5 million last year, or 1.4% after adjusting for discontinued categories in the U.K. and the impact of currency translation on sales in the U.S. and U.K. The decrease was due to lower sales volumes, primarily in the fresh bread business, partially offset by higher pricing across the Company.

Sales for the first nine months decreased 1.5% to $1,158.8 million compared to $1,176.6 million last year, or 0.9% after adjusting for discontinued categories in the U.K. and the impact of currency translation, due to similar factors noted above.

Adjusted Operating Earnings increased 16.7% in the third quarter to $38.9 million compared to $33.3 million last year, driven by higher pricing and operational improvements, partly offset by lower volumes. For the first nine months, Adjusted Operating Earnings increased 19.0% to $92.5 million compared to $77.7 million last year, due to similar factors noted above.

Net earnings in the quarter was $24.5 million ($0.96 basic earnings per share) compared to $23.5 million ($0.93 basic earnings per share) last year and included $3.7 million of pre-tax restructuring and other related costs (2012: $0.2 million). Year-to-date net earnings was $51.3 million ($2.02 basic earnings per share) compared to $49.8 million ($1.96 basic earnings per share) last year and included $15.2 million of pre-tax restructuring and other related costs (2012: $7.3 million).

Adjusted Earnings per Share was $1.10 for the third quarter (2012: $0.93) and $2.60 for the first nine months of 2013 (2012: $2.18).

Several items are excluded from the discussions of underlying earnings performance as they are not representative of on-going operational activities. Refer to the section entitled Non-IFRS Financial Measures at the end of this News Release for a description and reconciliation of all non-IFRS financial measures.

Business Segment Review

The following table summarizes sales by business segment:

 
($ thousands) Third Quarter Year-to-Date
(Unaudited)    2013     2012    2013   2012
Fresh Bakery $   266,719 $ 277,709 $ 780,553 $ 805,056
Frozen Bakery     125,782   123,785   378,283   371,543
Sales $   392,501 $ 401,494 $   1,158,836 $   1,176,599

 

The following table summarized Adjusted Operating Earnings by business segment:

 
($ thousands) Third Quarter Year-to-Date
(Unaudited)   2013   2012(1)   2013   2012(1)
Fresh Bakery $ 26,417 $ 28,086 $ 68,245 $ 64,503
Frozen Bakery   12,483   5,243   24,215   13,206
Adjusted Operating Earnings(2) $ 38,900 $ 33,329 $ 92,460 $ 77,709

 

Fresh Bakery

Includes fresh bakery products, including breads, rolls, bagels, sweet goods, and fresh pasta and sauces sold to retail, foodservice and convenience channels. It includes national brands such as Dempster's® and Olivieri® and many leading regional brands.

Fresh Bakery sales for the third quarter decreased 4.0% to $266.7 million compared to $277.7 million last year, as lower volumes were partly offset by the benefit of an earlier price increase in the fresh bread business. During the first nine months of 2013, sales decreased 3.0% to $780.6 million compared to $805.1 million last year due to similar factors.

Adjusted Operating Earnings in the Fresh Bakery segment declined 5.9% to $26.4 million from $28.1 million last year. Lower volumes and higher raw material and inflationary costs in the fresh bread business were partly offset by operating efficiencies, driven by the closure of a third Toronto, Ontario bakery, higher pricing, and lower selling, general, and administrative expenses. Earnings in the fresh pasta business were consistent with the prior year.

For the first nine months, Adjusted Operating Earnings increased 5.8% to $68.2 million compared to $64.5 million last year. In the fresh bread business, earnings improved as a result of higher pricing, operational improvements, and lower selling, general, and administrative spend, partly offset by lower volumes and higher raw material and other inflationary costs. Earnings in the fresh pasta business increased mainly due to an inventory write-off in the first quarter of last year that did not re-occur.

Frozen Bakery

Includes frozen bakery products, including frozen par-baked bakery products, specialty and artisan breads, and bagels sold to retail, foodservice and convenience channels in North America and the U.K. It includes national brands such as Tenderflake® and New York Bakery CoTM.

Frozen Bakery sales for the third quarter increased 1.6% to $125.8 million, or 4.2% after adjusting for discontinued categories in the U.K. and the impact of currency translation on sales in the U.S. and U.K. The increase was driven by volume growth in the U.K., and higher pricing in both the North American and U.K. bakery businesses. Year-to-date Frozen Bakery sales increased 1.8% to $378.3 million, or 3.8% after adjusting for discontinued categories in the U.K. and the impact of currency translation on sales in the U.S. and U.K. The increase was due to similar factors affecting the third quarter.

Third quarter Adjusted Operating Earnings increased to $12.5 million from $5.2 million last year. The North American frozen bakery business benefited from operational cost reductions and higher pricing, while the U.K. business earnings benefited from increased volumes in the bagel and croissant categories. This business continued to benefit from network consolidation, investment in scale facilities and focus on its core categories.

For the first nine months of 2013, Adjusted Operating Earnings increased 83.4% to $24.2 million compared to $13.2 million last year, due to similar factors affecting the third quarter.

Subsequent Events

On October 21, 2013 the Company announced that it has established a Special Committee comprised solely of independent directors in connection with the potential sale by Maple Leaf Foods Inc., of its 90% interest in the Company. Maple Leaf has advised the Company's Board that it is exploring strategic alternatives for its 90% interest in the Company, including a potential sale. This process is expected to conclude in early 2014. There can be no assurance that the process being undertaken by Maple Leaf Foods Inc. will result in the consummation of any transaction.

On October 24, 2013, the Company announced that it has signed a definitive agreement to sell substantially all of the net assets of its fresh pasta and sauce business, a component of the Fresh Bakery segment, for gross proceeds of approximately $120 million. Subject to Competition Bureau review, the transaction is expected to close by the end of 2013.

Other Matters

On October 29, 2013, the Company declared a dividend of $0.50 per share payable on January 2, 2014 to shareholders of record at the close of business on December 6, 2013. Unless indicated otherwise by the Company in writing on or before the time the dividend is paid, this dividend will be considered an Eligible Dividend for the purposes of the "Enhanced Dividend Tax Credit System".

Reconciliation of Non-IFRS Financial Measures

The Company uses the following non-IFRS measures: Adjusted Operating Earnings and Adjusted Earnings per Share.  Management believes that these non-IFRS measures provide useful information to both Management and investors in measuring the financial performance of the Company for the reasons outlined below.  These measures do not have a standardized meaning prescribed by IFRS and therefore they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS.

Adjusted Operating Earnings

Adjusted Operating Earnings, a non-IFRS measure, is used by Management to evaluate financial operating results.  It is defined as earnings before income taxes adjusted for items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in the earnings in future periods when the underlying asset is sold or transferred.  The table below provides a reconciliation of net earnings as reported under IFRS in the unaudited consolidated interim statements of earnings to Adjusted Operating Earnings for the three and nine months ended, as indicated below. Management believes that this basis is the most appropriate on which to evaluate operating results, as they are representative of the on-going operations of the Company.

 
($ thousands) Three months ended September 30, 2013
(Unaudited) Fresh
Bakery
Frozen
Bakery
Consolidated
Net earnings     $ 24,488
Income taxes     10,027
Earnings before income taxes     $ 34,515
Interest income     (73)
Earnings before interest and income taxes $ 25,001 $ 9,441 $ 34,442
Other expense 539 205 744
Restructuring and other related costs 877 2,837 3,714
Adjusted Operating Earnings $ 26,417 $ 12,483 $ 38,900

 

 
($ thousands) Three months ended September 30, 2012(1)
(Unaudited) Fresh
Bakery
Frozen
Bakery
Consolidated
Net earnings     $ 23,535
Income taxes     9,246
Earnings before income taxes     $ 32,781
Interest expense     365
Earnings before interest and income taxes $ 27,897 $ 5,249 $ 33,146
Other income 13 - 13
Restructuring and other related costs 176 (6) 170
Adjusted Operating Earnings $ 28,086 $ 5,243 $ 33,329

 

 
($ thousands) Nine months ended September 30, 2013
(Unaudited) Fresh
Bakery
Frozen
Bakery
Consolidated
Net earnings     $ 51,298
Income taxes     20,243
Earnings before income taxes     $ 71,541
Interest expense     615
Earnings before interest and income taxes $ 56,417 $ 15,739 $ 72,156
Other (income) expense 227 4,909 5,136
Restructuring and other related costs 11,601 3,567 15,168
Adjusted Operating Earnings $ 68,245 $ 24,215 $ 92,460

 

 
($ thousands) Nine months ended September 30, 2012(1)
(Unaudited) Fresh
Bakery
Frozen
Bakery
Consolidated
Net earnings     $ 49,789
Income taxes     20,826
Earnings before income taxes     $ 70,615
Interest expense     1,193
Earnings before interest and income taxes $ 62,537 $ 9,271 $ 71,808
Other (income) expense (1,567) 209 (1,358)
Restructuring and other related costs 3,533 3,726 7,259
Adjusted Operating Earnings $ 64,503 $ 13,206 $ 77,709

 

Adjusted Earnings per Share

Adjusted Earnings per Share, a non-IFRS measure, is used by Management to evaluate on-going financial operating results.  It is defined as basic earnings per share, adjusted for items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred.  The table below provides a reconciliation of basic earnings per share as reported under IFRS in the unaudited consolidated interim statements of earnings to Adjusted Earnings per Share for the three and nine months ended, as indicated below.  Management believes this basis is the most appropriate on which to evaluate financial results as they are representative of the on-going operations of the Company.

($ per share) Three months ended
September 30,
  NIne months ended
September 30,
(Unaudited) 2013 2012(1)   2013 2012(1)
           
Basic earnings per share $ 0.96 $ 0.93   $ 2.02 $ 1.96
Items not considered representative of on-going operations(i) 0.02 -   0.14 -
Restructuring and other related costs(ii) 0.11 0.01   0.44 0.22
Adjusted Earnings per Share (iii) $ 1.10 $ 0.93   $ 2.60 $ 2.18
     
(i)    Includes gains/losses associated with non-operational activities, including gains/losses related to restructuring activities, business combinations, discontinued operations, and assets held for sale, all net of tax.
(ii)    Includes per share impact of restructuring and other related costs, net of tax.
(iii)    May not add due to rounding

Forward-Looking Statements

This document contains, and the Company's oral and written public communications often contain, "forward-looking information" within the meaning of applicable securities laws. These statements are based on current expectations, estimates, forecasts and projections about the industries in which the Company operates and beliefs and assumptions made by Management. Such statements include, but are not limited to, statements with respect to objectives and goals, as well as statements with respect to beliefs, plans, objectives, expectations, anticipations, estimates and intentions. Specific forward-looking information in this document includes, but is not limited to, statements concerning expectations regarding the use of derivatives, futures and options, expectations regarding the timing and amount of capital investments, expectations regarding the timing and cost of old facility closures and new facility openings, the expected use of cash balances, source of funds for ongoing business requirements including capital investments and debt repayment, expectations regarding LEED® certification, expectations regarding the impact of new accounting standards, expectations regarding sufficiency of the allowance for uncollectible accounts and expectations regarding pension plan performance and future pension liabilities and contributions. Words such as "expect", "anticipate", "intend", "attempt", "may", "will", "plan", "believe", "seek", "estimate" and variations of such words and similar expressions are intended to identify such forward-looking information. These statements are not guarantees of future performance and involve assumptions and risks and uncertainties that are difficult to predict.

In particular, these statements are based on a variety of factors and assumptions that are discussed throughout this document. In addition, expectations concerning the performance of the Company's business in general are based on a number of factors and assumptions including, but not limited to: the condition of the Canadian, U.S. and U.K. economies; the rate of exchange of the Canadian dollar to the U.S. dollar and British pound; the availability and prices of raw materials, energy and supplies; product pricing; the availability of insurance; the competitive environment and related market conditions; improvement of operating efficiencies; continued access to capital; the cost of compliance with environmental and health standards; no adverse results from ongoing litigation; no unexpected actions of domestic and foreign governments and the general assumption that none of the risks identified below or elsewhere will materialize. All of these assumptions have been derived from information currently available to the Company including information obtained by the Company from third-party sources. These assumptions may prove to be incorrect in whole or in part. In addition, actual results may differ materially from those expressed, implied or forecasted in such forward-looking information, which reflect the Company's expectations only as of the date hereof.

Factors that could cause actual results or outcomes to differ materially from the results expressed, implied or forecasted in such forward-looking information include, among other things:

  • the risks associated with changes in the Company's systems and processes

  • the risks associated with the management service agreement with Maple Leaf

  • the Company's exposure to currency exchange risks

  • the ability of the Company to hedge against the effect of commodity price changes through the use of commodity futures and options

  • the impact of international events on commodity prices and the free flow of goods

  • the risks associated with a consolidating retail environment

  • the risks related to capital expansion projects

  • the risks posed by food contamination, consumer liability and product recalls

  • the risks related to acquisitions and divestitures

  • the risks posed by compliance with extensive government regulation

  • the risks posed by litigation

  • the impact of changes in consumer tastes and buying patterns

  • the impact of extensive environmental regulation and potential environmental liabilities

  • the risks associated with complying with differing employment laws and practices globally, the potential for work stoppages due to non-renewal of collective agreements and recruiting and retaining qualified personnel

  • the impact on pension expense and funding requirements of fluctuations in the market prices of fixed income and equity securities and changes in interest rates

  • the risks associated with the Company's independent distributors

  • the risks posed by competition

  • the risks associated with pricing the Company's products

  • the risks associated with managing the Company's supply chain

    the risks associated with failing to identify and manage the strategic risks facing the Company.

The Company cautions the reader that the foregoing list of factors is not exhaustive. These factors are discussed in more detail under the heading "Risk Factors" in the Company's Management's Discussion and Analysis for the year ended December 31, 2012 that is available on SEDAR at www.sedar.com. The reader should review such section in detail. The Company does not intend to, and the Company disclaims any obligation to, update any forward-looking information, whether written or oral, or whether as a result of new information, future events or otherwise except as required by law.

Additional information concerning the Company, including the Company's Annual Information Form, is available on SEDAR at www.sedar.com.

Canada Bread Company Limited, which is 90.0% owned by Maple Leaf Foods Inc. (TSX:MFI), is a leading manufacturer and distributor of fresh bakery products, frozen par-baked products and fresh pasta and sauces. The Company had 2012 sales of $1.6 billion and employs approximately 6,400 people at its operations across North America and in the United Kingdom.

Footnote Legend


(1)  2012 figures have been restated for the impact of adopting the revised International Accounting Standard 19 Employee Benefits ("IAS 19"), as disclosed in Note 20 of the Company's unaudited condensed consolidated interim financial statements.
   
(2)  Adjusted Operating Earnings, a non-IFRS measure, is used by Management to evaluate financial operating results.  It is defined as earnings before income taxes adjusted for items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred. Please refer to the section entitled Reconciliation of Non-IFRS Financial Measures in this news release.
   
(3)   Adjusted Earnings per Share, a non-IFRS measure, is used by Management to evaluate on-going financial operating results.  It is defined as basic earnings per share, adjusted for all items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred. Please refer to the section entitled Reconciliation of Non-IFRS Financial Measures in this news release.
   
(4)  Adjusted EBITDA, a non-IFRS measure, is used by Management to evaluate financial operating results.  It is defined as earnings before interest and income taxes plus depreciation and intangible asset amortization, adjusted for items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred.


Condensed Consolidated Interim Financial Statements
(Expressed in Canadian dollars)
(Unaudited)

CANADA BREAD COMPANY, LIMITED

Three and nine months ended September 30, 2013 and 2012

Consolidated Balance Sheets

                       
(In thousands of Canadian dollars) As at September 30,   As at September 30,   As at December 31,   As at January 1,
(Unaudited)  2013   2012   2012   2012
         (Restated)   (Restated)   (Restated)
               
ASSETS               
Current assets               
  Cash and cash equivalents $ 188,359   $ 87,300   $ 90,415   $ 59,223
  Accounts receivable  39,807   39,782   50,465   56,522
  Note receivable   30,225   50,893   43,033   52,587
  Inventories   59,689   63,912   62,766   60,048
  Income taxes recoverable 380   -   -   2,162
  Assets held for sale  5,320   -   -   -
  Prepaid expenses and other assets 6,562   4,288   4,972   5,218
          $ 330,342   $ 246,175   $ 251,651   $ 235,760
  Property and equipment  391,304   409,958   410,479   425,944
  Investment property  10,125   9,524   9,103   8,415
  Other long-term assets 4,783   4,713   4,994   4,456
  Deferred tax asset 17,588   19,419   17,874   17,917
  Goodwill    267,082   263,177   264,243   266,013
  Intangible assets  9,622   12,046   11,647   12,710
  Total assets   $ 1,030,846   $ 965,012   $ 969,991   $ 971,215
                       
LIABILITIES AND SHAREHOLDERS' EQUITY              
Current liabilities               
  Bank indebtedness $ -   $ 1,587   $ -   $ 3,153
  Accounts payable and accruals 208,175   177,101   169,431   192,551
  Provisions   7,207   10,251   9,928   23,066
  Due to Maple Leaf Foods Inc.  6,320   3,571   4,830   2,451
  Dividends payable 12,708   12,708   12,708   5,083
  Income taxes payable -   123   2,008   -
  Current portion of long-term debt 564   350   358   2,452
    $ 234,974   $ 205,691   $ 199,263   $ 228,756
  Long-term debt   2,433   2,986   2,921   1,634
  Deferred tax liability 26,375   19,224   19,998   21,784
  Employee benefits  40,112   60,447   56,011   50,434
  Provisions    8,144   5,521   6,277   5,005
  Total liabilities    $ 312,038   $ 293,869   $ 284,470   $ 307,613
                       
Shareholders' equity              
Share capital   $ 142,965   $ 142,965   $ 142,965   $ 142,965
Retained earnings   582,262   543,316   555,322   530,852
Accumulated other                
  comprehensive loss  (6,419)   (15,138)   (12,766)   (10,215)
Total shareholders' equity $ 718,808   $ 671,143   $ 685,521   $ 663,602
Total liabilities and shareholders' equity $ 1,030,846   $ 965,012   $ 969,991   $ 971,215
                       

 

Consolidated Statements of Earnings

(In thousands of Canadian dollars, except share amounts)   Three months ended
September 30,
  Nine months ended
September 30,
(Unaudited)  2013   2012   2013   2012
            (Restated)       (Restated)
                     
Sales $ 392,501   $ 401,494   $ 1,158,836   $ 1,176,599
Cost of goods sold 305,866   318,879   923,339   946,787
                    
Gross margin $ 86,635   $ 82,615   $ 235,497   $ 229,812
Selling, general and administrative expenses   47,735   49,286   143,037   152,103
 
Earnings before the following: $ 38,900   $ 33,329   $ 92,460   $ 77,709
Restructuring and other related costs  (3,714)   (170)   (15,168)   (7,259)
Other (expense) income   (744)   (13)   (5,136)   1,358
               
Earnings before interest and income taxes $ 34,442   $ 33,146   $ 72,156   $ 71,808
Interest (income) expense  (73)   365   615   1,193
               
Earnings before income taxes $ 34,515   $ 32,781   $ 71,541   $ 70,615
Income taxes 10,027   9,246   20,243   20,826
               
Net earnings $ 24,488   $ 23,535   $ 51,298   $ 49,789
               
Earnings per share              
  Basic and diluted earnings per share  $ 0.96   $ 0.93    $ 2.02    $ 1.96
Weighted average number of shares (millions) 25.4   25.4   25.4   25.4

 

Consolidated Statements of Comprehensive Income

(In thousands of Canadian dollars)  Three months ended
September 30,
  Nine months ended
September 30,
(Unaudited) 2013   2012   2013   2012
        (Restated)       (Restated)
 
Net earnings  $ 24,488   $ 23,535   $ 51,298   $ 49,789
                   
Other comprehensive income (loss)              
Item that will not be reclassified to profit or loss:              
    Change in actuarial gains and losses 836   (4,061)   13,767   (6,824)
Total item that will not be reclassified to profit or loss 836   (4,061)   13,767   (6,824)
Items that are or may be reclassified subsequently to profit or loss:  
    Change in accumulated foreign currency               
      translation adjustment (471)   (4,836)   6,331   (4,273)
    Change in unrealized gains and losses               
      on cash flow hedges (430)   (228)   16   (650)
Total items that are or may be reclassified               
  subsequently to profit or loss $ (901)   $ (5,064)    $ 6,347   $ (4,923)
  $ (65)   $ (9,125)   $ 20,114   $ (11,747)
Comprehensive income $ 24,423   $ 14,410   $ 71,412   $ 38,042

 

Consolidated Statements of Changes in Shareholder's Equity

          Total    
          accumulated    
          other   Total
(In thousands of Canadian dollars) Share   Retained   comprehensive   shareholders'
(Unaudited) capital   earnings   loss   equity
                 
Balance at December 31, 2012              
  (restated)  $ 142,965   $ 555,322   $ (12,766)   $ 685,521
  Net earnings -   51,298   -   51,298
  Other comprehensive income -   13,767   6,347   20,114
  Dividends declared ($1.50 per share) -   (38,125)   -   (38,125)
Balance at September 30, 2013 $ 142,965   $ 582,262   $ (6,419)   $ 718,808
               
                      Total      
                      accumulated    
                      other     Total
(In thousands of Canadian dollars) Share   Retained   comprehensive   shareholders'
(Unaudited)     capital   earnings     loss   equity
                (Restated)
                           
Balance at January 1, 2012                  
  (restated)  $ 142,965   $ 530,852   $ (10,215)   $ 663,602
  Net earnings -   49,789   -   49,789
  Other comprehensive loss -   (6,824)   (4,923)   (11,747)
  Dividends declared ($1.20 per share) -   (30,501)   -   (30,501)
Balance at September 30, 2012                
  (restated)  $ 142,965   $ 543,316   $ (15,138)   $ 671,143

 

Consolidated Statements of Cash Flows

(In thousands of Canadian dollars)  Three months ended
September 30,
  Nine months ended
September 30,
(Unaudited)  2013   2012   2013   2012
            (Restated)       (Restated)
 
CASH (USED IN) PROVIDED BY:
 
Operating activities
  Net earnings  $ 24,488   $ 23,535   $ 51,298   $ 49,789
  Add (deduct) items not affecting cash:            
    Depreciation and amortization 13,051   12,582   38,947   36,522
    Deferred income taxes 2,615   (1,039)   1,531   (121)
    Income tax current 7,412   10,285   18,712   20,947
    Interest (income) expense (73)   365   615   1,193
    Gain on sale of long-term assets (30)   (11)   (1,387)   (137)
    Impairment of assets  -    -   4,212   -
  Increase in pension liability 1,235   473   2,706   840
  Net income taxes paid  (10,022)   (7,831)   (23,576)   (18,222)
  Interest received (paid) 121   (350)   (15)   (1,204)
  Change in provision for restructuring and              
    other related costs 502   (1,157)   (217)   (7,755)
  Other (553)   (112)   41   304
  Change in non-cash operating working capital 27,665   (12,608)   67,094   (1,553)
Cash provided by operating activities  $ 66,411   $ 24,132   $ 159,961   $ 80,603
                     
Financing activities              
  Dividends paid  $ (12,708)   $ (12,708)   $ (38,125)   $ (22,840)
  Net decrease in long-term debt (1,761)   (34)   (211)   (822)
Cash used in financing activities  $ (14,469)   $ (12,742)   $ (38,336)   $ (23,662)
                   
Investing activities              
  Additions to long-term assets  $ (9,214)   $ (10,147)   $ (26,797)   $ (32,180)
  Capitalization of interest expense (323)   -   (323)   -
  Proceeds from sale of long-term assets 346   2,434   3,439   4,882
Cash used in investing activities  $ (9,191)   $ (7,713)   $ (23,681)   $ (27,298)
                 
Increase in cash and cash equivalents  $ 42,751   $ 3,677   $ 97,944   $ 29,643
Net cash and cash equivalents, beginning of period 145,608   82,036   90,415   56,070
Net cash and cash equivalents, end of period  $ 188,359   $ 85,713   $ 188,359   $ 85,713
                       
Net cash and cash equivalents is comprised of:              
Cash and cash equivalents  $ 188,359   $ 87,300   $ 188,359   $ 87,300
Bank indebtedness -   (1,587)   -   (1,587)
Net cash and cash equivalents, end of period  $ 188,359   $ 85,713   $ 188,359   $ 85,713

 

Segmented Financial Information

   Three months ended September 30,       Nine months ended September 30
  2013   2012   2013   2012
      (Restated)       (Restated)
Sales              
  Fresh Bakery $ 266,719   $ 277,709   $ 780,553   $ 805,056
  Frozen Bakery 125,782   123,785   378,283   371,543
   $ 392,501     $ 401,494   $ 1,158,836   $ 1,176,599
                 
Earnings before restructuring and other related
  costs and other income  
  Fresh Bakery $ 26,417   $ 28,086   $ 68,245   $ 64,503
  Frozen Bakery  12,483   5,243   24,215   13,206
    $ 38,900   $ 33,329   $ 92,460   $ 77,709
                 
Capital expenditures
  Fresh Bakery $ 1,247   $ 6,821   $ 7,995   $ 24,553
  Frozen Bakery 7,967   3,326   18,802   7,627
  $ 9,214   $ 10,147   $ 26,797   $ 32,180
   
Depreciation and amortization
  Fresh Bakery $ 8,190   $ 7,918   $ 24,425   $ 22,622
  Frozen Bakery 4,861   4,664   14,522   13,900
  $ 13,051   $ 12,582   $ 38,947   $ 36,522

 

       As at September 30,   As at September 30,   As at December 31,   As at January 1,
  2013   2012   2012   2012
        (Restated)   (Restated)   (Restated)
 
Total assets
  Fresh Bakery  $ 465,687   $ 507,476   $ 504,062   $ 522,236
  Frozen Bakery  342,552   350,922   356,311   369,523
  Non-allocated assets 222,607   106,614   109,618   79,456
   $ 1,030,846   $ 965,012   $ 969,991   $ 971,215
Goodwill
  Fresh Bakery  $ 125,892   $ 125,892   $ 125,892   $ 125,892
  Frozen Bakery  141,190   137,285   138,351   140,121
  $ 267,082   $ 263,177   $ 264,243   $ 266,013

 

 

SOURCE: Canada Bread Company, Limited

For further information:


Investor Contact: Nick Boland,
VP Investor Relations: 416-926-2005
Media Contact: 416-926-2020


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