Taiga Building Products Ltd. Announces First Quarter Earnings and Retirement of John P. Bell from the Board

BURNABY, BC, Sept. 12, 2011 /CNW/ - Taiga Building Products Ltd. ("Taiga" or the "Company") today reported its quarterly results for the three months ended June 30, 2011.

The Company's quarterly results for the three months ended June 30, 2011 are presented in accordance with International Financial Reporting Standards ("IFRS") and comparative information for the corresponding 2010 results have been restated accordingly. For details please refer to the company's unaudited financial statements for the three months ended June 30, 2011 available on SEDAR www.sedar.com.

Earnings Results - Three Months Ended June 30, 2011

The Company's consolidated net sales for the quarter ended June 30, 2011 were $263.6 million compared to $294.4 million over the same period last year, a decrease of $30.8 million or 10.5%. The decrease was due to the lack of an upward movement in commodity prices and weaker demand driven by less housing construction activity.

Gross margin for the quarter ended June 30, 2011 was $26.7 million compared to $30.0 million over the same period last year. Gross margin percentage for the quarter was 10.1% compared to 10.2% over the same period last year. The decline in gross margin was due to weaker average commodity prices during the quarter compared to the same quarter in the prior year.

Net earnings for the quarter ended June 30, 2011 was $3.6 million, a decrease of $1.7 million compared to $5.3 million over the same period last year. EBITDA for the quarter ended June 30, 2011 was $11.8 million, a decrease of $1.8 million, compared to $13.6 million over the same period last year. These decreases were primarily due to a decrease in gross margin, partially offset by lower corresponding compensation expenses included in selling and administration expense.

Retirement

The Board of Directors of the Company announced the retirement of John P. Bell from the Board, effective July 21, 2011. The Board would like to thank Mr. Bell for six years of dedicated service.

Selected Consolidated Statement of Earnings
 
For the Three Months Ended
(in thousands of Canadian dollars, except for per share amounts)
 
        June 30,
        2011     2010
Sales             $263,606           $294,382
Gross margin       26,705     30,000
Distribution expense       4,588     4,393
Selling and administration expense       11,100     12,804
Finance expense       1,514     1,064
Subordinated debt interest expense       4,016     4,016
Other expense (income)       22     (58)
Earnings before income taxes       5,465     7,781
Provision for income taxes       1,821     2,444
Net earnings       3,644     5,337
Net earnings per share(1)       0.11     0.16
EBITDA(2)       11,814     13,608

The following is the reconciliation of net earnings to EBITDA:

    Three Months Ended
June 30,
(in thousands of Canadian dollars)   2011
$
2010
$
Net earnings   3,644 5,337
Income taxes   1,821 2,444
Finance and subordinated debt interest expense   5,530 5,080
Amortization   819 747
EBITDA   11,814 13,608

Notes:

(1) EPS is earnings per share calculated using the weighted average number of shares.
(2) Reference is made above to EBITDA, which represents earnings before interest, taxes, and amortization. As there is no generally accepted method of calculating EBITDA, the measure as calculated by Taiga might not be comparable to similarly titled measures reported by other issuers. EBITDA is presented as management believes it is a useful indicator of a company's ability to meet debt service and capital expenditure requirements and because management interprets trends in EBITDA as an indicator of relative operating performance. EBITDA should not be considered by an investor as an alternative to net income or cash flows as determined in accordance with IFRS.

The foregoing selected financial information is qualified in its entirety by and should be read in conjunction with, our unaudited interim consolidated financial statements for the quarter ended June 30, 2011 and accompanying notes and management's discussion and analysis which will be available shortly on Sedar at www.sedar.com.

Forward-Looking Statements:

This press release contains certain forward-looking information and statements relating, but not limited, to future events or performance and strategies and expectations of Taiga. Forward-looking information typically contains statements with words such as "consider", "anticipate", "believe", "expect", "plan", "intend", "likely", "may", "will", "should", "predict", "potential", "continue" or similar words suggesting future outcomes or statements regarding expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. Examples of such forward looking statements within this press release include statements relating to: our anticipated results of operations, including cost reduction savings; our expectations regarding market conditions; the sufficiency of our cash requirements and our ability to remain in compliance with our debt covenants. Readers should be aware that these statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements.

These forward-looking statements reflect management's current expectations or beliefs and are based on information currently available to Taiga and although Taiga believes it has a reasonable basis for making the forward-looking statements included in this document, readers are cautioned not to place undue reliance on such forward-looking information. By its nature, the forward-looking information of Taiga involves numerous assumptions and inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts and other forward-looking statements will not occur. These risks include, but are not limited to, changes in business strategies; the effects of litigation, competition and pricing pressures; changes in operational costs; changes in laws and regulations, including tax, environmental, employment, competition, anti-terrorism and trade laws; and Taiga's anticipation of and success in managing the risks associated with the foregoing. A further description of these additional factors can be found in the periodic and other reports filed by Taiga with Canadian securities commissions and available on Sedar (http://www.sedar.com).These forward-looking statements speak only as of the date of this press release. Taiga does not undertake, and specifically disclaims, any obligation to update or revise any forward looking information, whether as a result of new information, future developments or otherwise, except as required by applicable law.

SOURCE Taiga Building Products Ltd.

For further information:

For further information regarding Taiga please contact: 

Tom Stefan
CFO & Vice President, Finance and Administration
Phone:  604-438-1471
Fax:      604-439-4242

Mark Schneidereit
Manager, Corporate Planning
Phone: 604-438-1471
Fax: 604-439-4242


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