Cervus Equipment Corp. Announces 2012 Year End Results

Symbol: CVL (TSX)

CALGARY, March 14, 2013 /CNW/ - Cervus Equipment Corp. ("Cervus" or the "Company") (TSX: CVL) today announced its financial results and operational highlights for the year ended 2012.

"Cervus experienced strong overall growth in 2012 driven largely by our agricultural equipment segment and the Frontier Peterbilt transportation group we acquired in March. Based on the positive market outlook in these sectors, we expect continued growth in 2013," said Graham Drake, President and CEO of Cervus.  "We also continued to execute on our international growth strategy by expanding in New Zealand and entering into the Australian market during 2012.  We look forward to exploring the opportunities that these markets provide."

Highlights for the Year:

  • Acquired four Peterbilt dealerships and one collision repair center dealership, together with their respective lands and buildings in Saskatchewan, for an aggregate purchase price of $35 million.
  • Acquired $57.6 million of real estate assets including $26.3 million from Proventure Income Fund ; $14.4 million through the acquisition of the transportation group; and $16.9 million in shop expansions, the construction of a new John Deere store in Saskatoon, Saskatchewan,  and the preparation of construction of a new John Deere store in Calgary, Alberta.
  • Acquired a 34.6% interest in Windmill AG Pty Ltd., an Australian John Deere dealership, for approximately $3.1 million.
  • Acquired the remaining 39.7% of Cervus Equipment NZ Ltd. for a purchase price of $1.6 million via the issuance of 83,695 common shares of the Company at $18.90 per share.
  • Acquired five John Deere dealerships in New Zealand for an aggregate purchase price of $3.6 million, consisting of $2.6 million in cash and approximately $1 million via the issuance of 54,321 common shares of the Company at $18.90 per share.
  • Completed a $34.5 million public offering of convertible debentures for net proceeds of $32.9 million.
  • Gross revenue increased by $174.6 million or by 31.2% to $734.2 million for the year ended 2012 from $559.6 million in 2011. Same store sales increased 12.7% or $71.2 million.
  • Net profit for the year increased by $6.5 million or 35.6% to $24.6 million for the year ended 2012 from $18.1 million in 2011.
  • Basic earnings per share for the year ended December 31, 2012 increased to $1.65 per share or 29.9% from $1.27 per share in 2011.

Financial Highlights:

For the year ended December 31, 2012, revenue increased by $174.6 million or 31.2% ($70.7 million from the agricultural equipment segment and $116.5 million from the commercial and industrial equipment segment). Same store revenue increased $71.2 million or 12.7% ($62.5 million or 15.3% from the agricultural equipment segment and $8.7 million or 5.8% from the commercial and industrial equipment segment).

For the year ended December 31, 2012, overall gross margin increased slightly to 19.1% from 19.0% reported in 2011, an increase of 10 basis points.  The increase in sales, combined with the marginal change in overall gross profit margins, resulted in an increase in profit for the year ended 2012 when compared to 2011 of $6.5 million or 35.6%.  Selling, general and administrative expenditures remained the same in 2012 at 14.8% of total revenue when compared to 2011.

EBITDA increased by $12.8 million to $48.4 million, or $3.14 per fully diluted share in 2012 compared with $2.36 per fully diluted share for the same period in 2011. The most significant factor contributing to the increase in EBITDA for the year was the increase in net profit before income taxes which amounted to $7.7 million.

As at December 31, 2012, Cervus had working capital of $90.2 million, including $8.2 million in cash and cash equivalents, up $11.1 million compared to $79.1 million at December 31, 2011.

             
Selected Annual Information            
$ thousands, except per share amounts   2012   2011   % change
Revenues   734,245   559,598   31.2
Gross profit   140,178   106,335   31.8
Gross margin   19.1%   19.0%   0.5
Profit before income tax expense   33,687   26,026   29.4
Profit for the year   24,582   18,126   35.6
Profit attributable to shareholders   24,394   18,444   32.3
Net earnings per share            
  Basic   1.65   1.27   29.9
  Diluted   1.58   1.22   29.5
Cash provided by operating activities   18,951   25,849   (26.7)
  Per share - Basic   1.28   1.78   (28.1)
EBITDA1   48,412   35,643   35.8
EBITDA margin1   6.6%   6.4%   3.1
  Per share - basic   3.27   2.45   33.5
Dividends declared to shareholders   11,031   10,484   5.2
    Per share   0.745   0.72   3.5
Weighted average shares outstanding            
  Basic   14,791   14,546   1.7
  Diluted   15,406   15,061   2.3
Actual shares outstanding   14,900   14,703   1.3
Closing market price per share   18.74   14.72   27.3
Price earnings ratio1 - basic   11.35   11.59   (2.1)
Total assets   401,957   281,455   42.8
Long-term liabilities   69,562   9,928   600.7
Total debt   199,172   97,736   103.8
Shareholders' equity   202,785   183,719   10.4
Market capitalization1   279,224   216,428   29.0
Net book value per share - diluted1   13.16   12.20   7.9
             

1These financial measures are identified and defined under the section "Non-IFRS Financial Measures".

Conference Call Information

Cervus will host its 2012 year end results conference call on March 15, 2013 at 11:00 a.m. Eastern Time. Interested parties may access the conference call by dialling (888) 231-8191 (domestic) or (647) 427-7450 (international). The conference call will be archived for replay until Thursday, March 22, 2013 at midnight. To access the archived conference call, dial (416) 849-0833 or 1-855-859-2056 and enter the reservation number 16814329 followed by the number sign.

About Cervus Equipment Corporation

Cervus acquires and manages authorized agricultural, commercial, industrial and transportation equipment dealerships with interests in 55 dealership locations in Western Canada, New Zealand, and Australia. The primary equipment brands represented by Cervus include John Deere agricultural equipment; Bobcat and JCB construction equipment; Clark, Sellick, Nissan and Doosan material handling equipment; and Peterbilt transportation equipment. The common shares of Cervus are listed on the Toronto Stock Exchange and trade under the symbol "CVL".

 

SOURCE: Cervus Equipment Corporation

For further information:

Graham Drake - President & CEO
Telephone: (403) 567-2095
Fax: (403) 567-0392
Email: gdrake@cervusequipment.com

Randy Muth - Chief Financial Officer
Telephone: (403) 567-2097
Fax: (403) 567-0392
Email: rmuth@cervusequipment.com


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