BMTC Group Inc. announces financial results for its quarter ended September 30th, 2017

MONTREAL, Nov. 7, 2017 /CNW Telbec/ -

For the nine month period ended September 30th, 2017, the Company's revenues increased by $15,436,000 to $565,034,000, compared to $549,598,000 recorded in the corresponding 2016 period, a 2.8% increase. Same store revenues grew by 2.5% during the same period. Net earnings for the nine month period ended September 30th, 2017, amounted to $31,615,000 compared to $26,157,000 for the corresponding 2016 period. Basic net earnings per share amounted to $0.86 compared to $0.70 in 2016.

The 5,458,000 $ net earnings increase was due to the increase in after tax gross profit of $6,390,000  and  the decrease in after tax investment income of $1,090,000.

The effect of the cost of options had no impact on basic net earnings per share for the nine month period ended September 30th, 2017 and 2016.

For the nine month period ended September 30th, 2017, the share repurchase program contributed to an increase in basic net earnings per share of $0.01.

Excluding all these effects, the variation to the adjusted net earnings would have been $5,409,000 or $0.15 per basic share for the nine month period ended September 30th, 2017.

The $5,409,000 variation in adjusted net earnings for the third quarter of 2017 is as follows:

				(Unaudited and $ in thousands)
				2017		2016
Net earnings				31 615		26 157
Variation of cost of options (after-tax)				(70)		(21)
Adjusted net earnings				31 545		26 136
Minus: Adjusted net earnings for 2016				26 136
Variation				5 409

This variation in adjusted after-tax income is allocated throughout the quarters as follows:

	Increase	Increase		Increase
	(decrease)	(decrease)		(decrease)
	retail operating	investment		adjusted
	earnings	income		operating earnings
1st quarter 2017	(1 479)	2 424		945
2nd quarter 2017	2 618	(999)		1 619
3rd quarter 2017	5 360	(2 515)		2 845
Total	6 499	(1 090)		5 409

Annual Financial Information
($ in thousands, except for per share amounts)
		2016	2015
		$	$
Revenue		746 649	717 338
Net Earnings		43 830	41 528
Total Assets		309 483	274 022
Net Earnings Per Share
	Basic	1,17	0,99
	Diluted	1,17	0,99
Dividends Per Share		0,24	0,24

Financial Position and Dividends

Cash and investments increased by $20,576,000 during the nine month period ended September 30th, 2017. Investments consist primarily of bank notes, which at the close of the quarter had a market value of $105,493,000 (including cash).

As of September 30th, 2017, the working capital showed a surplus of $13,815,000 an increase of $79,000 compared to December 31st, 2016. The Company's shareholders' equity increased from $199,681,000 as at December 31st, 2016 to $215,305,000 as at September 30th, 2017. As of September 30th, 2017, the book value per share stood at $6.00, compared to $5.42 as at December 31st, 2016.

Pursuant to the normal course issuer bid put in place on March 14th, 2016, and renewed on March 23rd 2017, accordingly, 976,000 Common Shares were repurchased and cancelled by the Company. As a result of this change, the Company had as of September 30th, 2017, 35,884,000 Common Shares issued and outstanding.

During the nine month period ended September 30th, 2017, no options were granted or exercises. As at September 30th, 2017, options for 219,000 Common Shares, representing 0.61% of the Company's outstanding shares remain issued and 5,710,864 authorized share options, representing approximately 15.91% of the Company's outstanding shares, may still be granted pursuant to the Plan. The issued and outstanding options may be exercised at a price of $17.85 per Common Shares.

A semi-annual eligible dividend of $0.12 per Common Share has been declared to holders registered at the close of business on December 21st, 2017 which will be payable on January 3rd, 2018.

Quarterly Results
(Unaudited and $ in thousands, except for per share amounts)
		March 31st			June 30th
		2017	2016		2017	2016
		$	$		$	$
Revenue		161 998	154 943		199 314	197 043
Net (Loss) Earnings		57	(958)		14 014	12 407
Net (Loss) Earnings Per Share
	Basic	-	(0,02)		0,38	0,32
	Diluted	-	(0,02)		0,38	0,32
		September 30th			December 31st
		2017	2016		2016	2015
		$	$		$	$
Revenue		203 722	197 612		197 051	190 300
Net Earnings		17 544	14 708		17 673	16 236
Net Earnings Per Share
	Basic	0,48	0,40		0,47	0,41
	Diluted	0,48	0,40		0,47	0,41

For the quarter ended September 30th, 2017, the Company's revenues increased by $6,110,000 to $203,772,000, compared to $197,612,000 recorded in the corresponding 2016 period, a 3.1% increase. Same store revenues grew by 3.9% during the same period. Net earnings for the quarter ended September 30th, 2017, amounted to $17,544,000 compared to net earnings of $14,708,000 for the corresponding 2016 period. Basic net earnings per share increased to $0.48 compared to $0.40 in 2016.

The effect of the cost of options had no impact on basic net earnings per share for the three month periods ended September 30th, 2017 and 2016.

Excluding all these effects, the variation to the adjusted net earnings would have been $2,845,000 or $0.08 per basic share for the three month period ended September 30th, 2017.

The $2,845,000 variation in adjusted net earnings in 2017 is as follows:

	(Unaudited and $ in thousands)
	2017		2016
Net earnings	17 544		14 708
Variation of cost of options (after-tax)	31		22
Adjusted net earnings	17 575		14 730
Minus: Adjusted net earnings for 2016	14 730
Variation	2 845

Operations

BMTC Inc.

The Company has started the restructuration of all of its websites. The first phase of the implementation of a distinct e-commerce platform for its banner Brault & Martineau is now completed and operational since November, 2015. The process of implementation will continue throughout 2017 and 2018 for the following phases as well as the restructuring for all the other banners of the Company. The Company is also reviewing its IT systems in order standardise them throughout the banners, as well as to allow them to be more aligned with our e-commerce strategies. Following this evaluation, the Corporation decided to invest and to modify its existing IT systems, the integration and implementation will continue for a 3 to 5 year period.  As at September 30th, 2016, the Company had to re-evaluate its costs related to these modifications, which are now estimated to be $17,000,000. A portion of these costs, $6,500,000 were incurred during 2015 and 2016 and the balance will be recorded in the subsequent years.

Brault & Martineau Division

As previously announced on February 20th, 2017 regarding the imminent closing of the Repentigny store, the Company has sold the building and has officially cease its operations on November 6th, 2017.  Management believes its current store network will be able to cover this region.

Caution regarding forward-looking statements

This Quarterly Management Report contains certain forward-looking statements with respect to the Company. These forward-looking statements are identified by the use of terms and phrases such as "anticipate", "believe", "estimate", expect", "intend", "may", "plan", "predict", "project", "will", "would", as well as the negative of these terms and similar terminology, including references to assumptions.

Forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by these forward-looking statements. Results indicated in forward-looking statements may differ materially from actual results for a number of reasons which the Company has identified in the 2015 Annual Information Form under "Narrative Description of the Business - Risk Factors", and other risks detailed from time to time in the Company's continuous disclosure documents.

The reader is cautioned that the factors we refer above are not exhaustive of the factors that may affect any of the Company's forward-looking statements. The reader is also cautioned to consider these and other factors carefully and not to put undue reliance on forward-looking statements.

The Company made a number of assumptions in making forward-looking statements in this Quarterly Management Report. The Company considers the assumptions on which these forward-looking statements are based to be reasonable.

These statements reflect current expectations regarding future events and operating performance and speak only as of the date of release of this Quarterly Management Report, and represent the Company's expectations as of that date. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by law.

Non International Financial Reporting Standards (IFRS) financial measures

The Company discloses adjusted net earnings, which includes or excludes certain amounts that are not considered representative of performance measures and financial recurrence of the Company. Management believes that this measure is useful in understanding and analysing the operational performance of the Company and more appropriate to provide additional information.

The Company also discloses same store revenues, which have been realised in stores opened for more than a 12 month period. This measure is used by management and is a similar measures presented by other issuers in our industry.

Adjusted net earnings, adjusted operating earnings, adjusted administrative expenses as well as same store revenues are not an earnings measure recognised by IFRS and does not have a standardised meaning prescribed by IFRS. Therefore, adjusted net earnings and same store revenues as discussed in this MD&A may not be compared to similar measures presented by other issuers. This measure of performance should not be considered as an alternative as an indicator of performance calculated according to IFRS, but rather as additional information.

The Company discloses in this MD&A under the section "Results" a reconciliation between net earnings and adjusted net earnings.

BMTC Group Inc.'s Common Shares are listed on the Toronto Stock Exchange and through its subsidiary Ameublements Tanguay Inc., and its two divisions, Brault & Martineau and EconoMax, the Company is a major retailer of furniture, electronic goods and household appliances operating in the province of Quebec.

SOURCE BMTC Group Inc.

Mr. Yves Des Groseillers, Chairman, President and Chief Executive Officer, BMTC Group Inc., [phone]

Related Links

www.braultetmartineau.com