Comparable sales down 1.3% (total sales down 4.9%)
Stable comparable sales in the Distribution segment despite the negative
impact of external factors
Cash flows from operations of $11.9 million, reflecting sound management
of working capital
Optimized capital structure following the refinancing of its credit
facilities announced January 31, 2014
BOUCHERVILLE, QC, May 1, 2014 /CNW Telbec/ - Colabor Group Inc. (TSX:
GCL) ("Colabor" or the "Company") today reported results for the first
quarter of fiscal 2014 ended March 22, 2014.
"As expected, first-quarter results were affected by winter weather
considerably more severe than last year and by a slow economy, mainly
in Quebec. These external factors led to reduced traffic in
restaurants, which limited Colabor sales to the foodservice industry,
as well as to higher delivery costs. The decrease in volume had a
marked effect on operating profitability and offset the benefits of
measures taken under our action plan which, notably, resulted in lower
warehousing costs," said Claude Gariépy, President and Chief Executive
Officer of Colabor.
(thousands of dollars except per-share data)
March 22, 2014
March 23, 2013
Charges not related to current operations
Per share - basic ($)
Cash flow from operations
Weighted average number of shares outstanding (basic, in thousands)
Consolidated sales for the 81-day period ended March 22, 2014 were
$279.3 million, compared to $293.6 million for the 82-day period ended
March 23, 2013. The 4.9% decrease is attributable to the residual
effects of the end of a large supply contract in Ontario in April 2013
and to the termination of unprofitable distribution of tobacco products
beginning in the second quarter of 2013. In addition, harsher winter
weather in the first quarter of 2014 relative to a year earlier
affected the Company's sales to the foodservice industry by reducing
traffic in restaurants. On the other hand, the acquisition of T. Lauzon
Ltée ("Lauzon") contributed to sales for the entire quarter in 2014
compared to only 20 days in the first quarter of 2013.
Excluding the above factors, and on the basis of an equal number of
days, comparable sales were down 1.3%. Comparable sales were stable in
the Distribution segment, where an increase in the sales of Norref and
higher sales in Ontario were offset by the negative impact of external
factors in eastern Quebec. For the Wholesale segment, comparable sales
were down 4.1%.
Earnings before financial expenses, income taxes, depreciation and
amortization ("EBITDA") were $148,000, compared to $2.3 million in the
first quarter of 2013. The decrease was due to the effect of lower
sales volume on the absorption of fixed operating costs, to the end of
the supply contract in Ontario and to the effect of higher commodity
prices on the profitability of Lauzon operations. Consequently the
Company recorded a net loss for the quarter of $5.6 million compared to
a net loss of $3.4 million a year earlier.
CASH FLOWS AND FINANCIAL POSITION
Cash flows from operations were $11.9 million in the first quarter of
2014, compared to a negative $25.8 million in the first quarter of
2013. The substantial and sustainable improvement reflects sound
management of working capital, which generated funds of $12.2 million
during the quarter due to the seasonal nature of operations.
This source of liquidity allowed the Company to reduce the amount drawn
on its bank credit facility. As at March 22, 2014, that amount was
$87.4 million, down from $108.7 million at the end of the previous
quarter. Average daily indebtedness in the first quarter of 2014 was
$96 million, down from $128 million in the first quarter of 2013 and
from $102 million in the fourth quarter of 2013.
REFINANCING OF CREDIT FACILITIES
Colabor announced on January 31, the refinancing of its credit
facilities and entered into a long-term loan of $42.5 million, of which
$15 million was used to repay existing debt.
The implementation of the refinancing allows Colabor to improve
operational flexibility because it has no more leverage ratio
constraint to respect and a greater availability in cash.
DECLARATION OF A QUARTERLY DIVIDEND OF $0.06 PER SHARE
The Board of Directors of the Company has declared a cash dividend of
$0.06 per share, to be paid June 16, 2014 to shareholders of record as
of the close of business May 30, 2014. This dividend constitutes an
eligible dividend under subsection 89(14) of the Income Tax Act.
"Colabor has taken major measures to improve its efficiency and grow its
sales. Although we have no control over external factors, we continue
to put in place new operating processes that will bring us further cost
savings over the coming quarters. We are ready to reap returns from
increases in volume, which will have a direct effect on operating
profitability," concluded Mr. Gariépy.
Colabor will hold a conference call to discuss these results on
Thursday, May 1, 2014, beginning at 3 p.m. Eastern Time. Interested
parties can join the call by dialling 647-427-7450 (from Toronto and
overseas) or 1-888-231-8191 (from elsewhere in North America). If you
are unable to participate, you can listen to a recording by dialling
1-855-859-2056 and entering the code 30548315 on your telephone keypad.
The recording will be available from 6 p.m. on Thursday, May 1, 2014 to
11:59 p.m. on Thursday, May 8, 2014.
The information provided in this release includes non-IFRS performance
measures, notably earnings before financial expenses, income taxes,
depreciation and amortization (EBITDA) and cash flow. Since these
concepts are not defined by IFRS, they may not be comparable to those
of other companies.
The Management Discussion and Analysis and the financial statements of the Company will be available at SEDAR
(www.sedar.com) following publication of this release. Additional information about
Colabor Group Inc. may also be found at SEDAR and on the Company's
website at www.colabor.com.
This news release may contain forward-looking statements reflecting the
opinions or current expectations of Colabor Group Inc. concerning its
performance and business operations and future events. These statements
are subject to risks, uncertainties and assumptions. Actual results or
events may differ.
Colabor is a wholesaler and distributor of food and non-food products
serving the foodservice market (cafeterias, restaurants, hotels,
restaurant chains) and the retail market (grocery stores, convenience
stores, etc.), in Quebec, Ontario and the Atlantic provinces.
For further information:
Colabor Group Inc.
Jean-François Neault, CPA, CMA, MBA
Vice-President and Chief Financial Officer
Tel. 450-449-0026 ext. 308
Maison Brison Inc.
Martin Goulet, CFA
Senior Vice-President, Investor Relations
Tel. 514-731-0000 ext. 229