BOUCHERVILLE, QC, Aug. 6, 2014 /CNW Telbec/ - Canam Group Inc. (TSX: CAM), specialized in the design and fabrication of construction products, reported a net income of $4.5M, or $0.11 per share, in the second quarter of 2014, compared with $7.4M, or $0.18 per share, for the corresponding period in 2013. Consolidated revenues in the second quarter of 2014 increased by 11.4% to $281M compared with $252M for the year-earlier quarter.
After the first six months of fiscal 2014, net income totaled $5M, or $0.12 per share, compared with $10.4M, or $0.25 per share, during the same period in 2013. Consolidated revenues during the first half of 2014 stood at $520M compared with $462M for the corresponding six-month period in 2013.
As at June 28, 2014, Canam Group's backlog of orders reached another record level of $857M compared with $793M as at March 29, 2014 and $619M at the end of the second quarter of 2013.
The results in the second quarter of 2014 compared with 2013 reflect the lower gross margins in most markets for the first four months of 2014, which could not be offset by the increase in the gross margin observed in May and June.
"However, our results at the end of the quarter allowed us to build positive momentum that appears to be confirmed by the increase in the backlog of orders," explained President and Chief Executive Officer Marc Dutil. "This reflects the strength of our markets, particularly in the United States."
Dividend
The Board of Directors approved a quarterly dividend of $0.04 per share payable on September 30, 2014 to shareholders of record on September 16, 2014.
About Canam Group Inc.
Canam Group is the largest fabricator of steel components in North America. Specialized in designing construction solutions and fabricating customized products since 1961, Canam Group takes part in an average of 10,000 construction projects each year in three groups of products and services: buildings, structural steel and bridges. The Corporation operates 21 plants across North America and employs 3,600 people in Canada, the United States, Romania, India and Hong Kong.
Conference call
Canam Group will hold a conference call with financial analysts and media representatives on Wednesday, August 6, 2014 at 4:30 p.m. EDT. A podcast will be available at www.canamgroupinc.com and www.cnw.ca. A replay of the conference call will be available until August 22, 2014 by dialing 1-800-408-3053 and entering access code 2682182, followed by the pound key (#).
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF INCOME
Periods ended June 28, 2014 and June 29, 2013
| (in thousands of Canadian dollars, except per share amounts) | Three months | Six months | ||||||||
| (unaudited) | 2014 | 2013 | 2014 | 2013 | ||||||
| Revenues | $ | 280,616 | $ | 251,850 | $ | 519,919 | $ | 461,602 | ||
| Cost of sales, excluding depreciation and amortization(1) | 241,558 | 209,787 | 449,224 | 386,256 | ||||||
| Selling and administrative expenses | 22,194 | 23,215 | 43,999 | 43,323 | ||||||
| Profit sharing program | 658 | 1,286 | 875 | 1,536 | ||||||
| Depreciation of property, plant and equipment | 5,845 | 5,471 | 11,440 | 10,777 | ||||||
| Amortization of intangible assets | 483 | 401 | 956 | 778 | ||||||
| Other losses (gains) — net | 295 | (1,668) | (110) | (1,787) | ||||||
| Finance costs | 3,693 | 3,571 | 7,189 | 7,320 | ||||||
| Finance revenue | (280) | (311) | (518) | (617) | ||||||
| Share of loss (income) of a joint venture and associates | 39 | (36) | 321 | (340) | ||||||
| Income before income tax | 6,131 | 10,134 | 6,543 | 14,356 | ||||||
| Tax expense (income) | ||||||||||
| Current | 748 | 1,725 | (589) | 2,842 | ||||||
| Deferred | 882 | 984 | 2,081 | 1,116 | ||||||
| 1,630 | 2,709 | 1,492 | 3,958 | |||||||
| Net income | $ | 4,501 | $ | 7,425 | $ | 5,051 | $ | 10,398 | ||
| Net income attributable to: | ||||||||||
| Shareholders | $ | 4,530 | $ | 7,425 | $ | 5,004 | $ | 10,398 | ||
| Non-controlling interests | (29) | - - | 47 | - - | ||||||
| $ | 4,501 | $ | 7,425 | $ | 5,051 | $ | 10,398 | |||
| Net earnings per share attributable to shareholders | ||||||||||
| Basic | $ | 0.11 | $ | 0.18 | $ | 0.12 | $ | 0.25 | ||
| Diluted | $ | 0.11 | $ | 0.18 | $ | 0.12 | $ | 0.25 | ||
| Weighted average number of common shares (in thousands of shares) | ||||||||||
| Basic | 42,022 | 41,957 | 42,047 | 41,953 | ||||||
| Diluted | 42,078 | 42,088 | 42,103 | 42,084 | ||||||
| Number of common shares outstanding (in thousands of shares) | 42,078 | 42,073 | ||||||||
| (1) | As at June 28, 2014 and June 29, 2013, the cost of sales, including depreciation and amortization, totaled $246,395 and $214,442, respectively, for the three-month period and $458,902 and $395,624, respectively, for the six-month period. |
|||||||||
NOTICE
The Corporation's independent auditors have not performed a review of the accompanying condensed interim consolidated financial statements.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Periods ended June 28, 2014 and June 29, 2013
| (in thousands of Canadian dollars) | Three months | Six months | ||||||||
| (unaudited) | 2014 | 2013 | 2014 | 2013 | ||||||
| Net income | $ | 4,501 | $ | 7,425 | $ | 5,051 | $ | 10,398 | ||
| Other comprehensive income (loss): | ||||||||||
| Items that will be reclassified subsequently to profit or loss | ||||||||||
| Change in unrealized gains (losses) on translating foreign operations | (10,331) | 7,134 | 135 | 11,198 | ||||||
| Available-for-sale assets: | ||||||||||
| Unrealized gains on available-for-sale financial assets arising during the period | - - | 14 | - - | 41 | ||||||
| Reclassified to statements of income | - - | (828) | - - | (867) | ||||||
| Tax income | - - | 135 | - - | 137 | ||||||
| - - | (679) | - - | (689) | |||||||
| Other comprehensive income (loss) | (10,331) | 6,455 | 135 | 10,509 | ||||||
| Comprehensive income (loss) | $ | (5,830) | $ | 13,880 | $ | 5,186 | $ | 20,907 | ||
| Attributable to: | ||||||||||
| Shareholders | $ | (5,804) | $ | 13,880 | $ | 5,136 | $ | 20,907 | ||
| Non-controlling interests | (26) | - - | 50 | - - | ||||||
| $ | (5,830) | $ | 13,880 | $ | 5,186 | $ | 20,907 | |||
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS
| (in thousands of Canadian dollars) (unaudited) |
As at June 28, 2014 |
As at December 31, 2013 |
|||||
| Assets | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 2,498 | $ | 4,690 | |||
| Accounts receivable | 333,910 | 299,981 | |||||
| Inventories | 138,250 | 110,993 | |||||
| Recoverable tax assets | 2,133 | 264 | |||||
| Prepaid expenses and other assets | 4,437 | 3,762 | |||||
| 481,228 | 419,690 | ||||||
| Property, plant and equipment classified as held for sale | 1,571 | 1,567 | |||||
| 482,799 | 421,257 | ||||||
| Non-current assets | |||||||
| Investments | 4,699 | 4,699 | |||||
| Interests in a joint venture and associates | 41,669 | 41,390 | |||||
| Property, plant and equipment | 293,707 | 292,289 | |||||
| Intangible assets | 10,720 | 9,760 | |||||
| Goodwill | 41,513 | 41,417 | |||||
| Deferred tax assets | 10,007 | 11,957 | |||||
| Long-term receivables and other assets | 9,019 | 10,971 | |||||
| Total assets | $ | 894,133 | $ | 833,740 | |||
| Liabilities | |||||||
| Current liabilities | |||||||
| Accounts payable and accrued liabilities | $ | 190,861 | $ | 185,909 | |||
| Current tax liabilities | 529 | 8,119 | |||||
| Current portion of long-term debt | 13,477 | 13,000 | |||||
| 204,867 | 207,028 | ||||||
| Non-current liabilities | |||||||
| Debt | 184,902 | 124,025 | |||||
| Convertible debentures | 66,143 | 65,442 | |||||
| Provisions | 6,929 | 6,816 | |||||
| Deferred tax liabilities | 9,988 | 9,922 | |||||
| Other liabilities | 7,436 | 8,849 | |||||
| Total liabilities | 480,265 | 422,082 | |||||
| Equity | |||||||
| Share capital | 168,147 | 168,057 | |||||
| Retained earnings | 232,399 | 230,717 | |||||
| Other equity items | 13,088 | 12,884 | |||||
| Total equity attributable to shareholders | 413,634 | 411,658 | |||||
| Non-controlling interests | 234 | - - | |||||
| Total equity | 413,868 | 411,658 | |||||
| Total equity and liabilities | $ | 894,133 | $ | 833,740 | |
||
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
| (in thousands of Canadian dollars) (unaudited) |
Employee benefits paid in equity instruments |
Exchange differences resulting from the translation of foreign operations |
Available- for- sale financial assets |
Debenture conversion options |
Total other equity items |
Share capital | Retained earnings |
Total share capital attributable to shareholders |
Non- controlling interests |
Total equity |
||||||||||
| Balance as at January 1, 2013 | $ | 1,994 | $ | (11,941) | $ | 691 | $ | 5,764 | $ | (3,492) | $ | 168,529 | $ | 197,148 | $ | 362,185 | $ | - - | $ | 362,185 |
| Net income for the period | - - | - - | - - | - - | - - | - - | 10,398 | 10,398 | - - | 10,398 | ||||||||||
| Comprehensive income | - - | 11,198 | (689) | - - | 10,509 | - - | - - | 10,509 | - - | 10,509 | ||||||||||
| Shares purchased by a trust in employees' name on the secondary market | - - | - - | - - | - - | - - | (651) | - - | (651) | - - | (651) | ||||||||||
| Shares acquired by employees | (202) | - - | - - | - - | (202) | 202 | - - | - - | - - | - - | ||||||||||
| Repurchase of shares | - - | - - | - - | - - | - - | (23) | - - | (23) | - - | (23) | ||||||||||
| Excess of acquisition cost over carrying amount of acquired common shares | - - | - - | - - | - - | - - | - - | (16) | (16) | - - | (16) | ||||||||||
| Amortization of compensation costs related to the profit sharing program - stock ownership component | 159 | - - | - - | - - | 159 | - - | - - | 159 | - - | 159 | ||||||||||
| Balance as at June 29, 2013 | $ | 1,951 | $ | (743) | $ | 2 | $ | 5,764 | $ | 6,974 | $ | 168,057 | $ | 207,530 | $ | 382,561 | $ | - - | $ | 382,561 |
| Balance as at January 1, 2014 | $ | 2,113 | $ | 5,005 | $ | 2 | $ | 5,764 | $ | 12,884 | $ | 168,057 | $ | 230,717 | $ | 411,658 | $ | - - | $ | 411,658 |
| Investment in a subsidiary by a non-controlling interest | - - | - - | - - | - - | - - | - - | - - | - - | 184 | 184 | ||||||||||
| Net income for the period | - - | - - | - - | - - | - - | - - | 5,004 | 5,004 | 47 | 5,051 | ||||||||||
| Comprehensive income | - - | 132 | - - | - - | 132 | - - | - - | 132 | 3 | 135 | ||||||||||
| Dividends | - - | - - | - - | - - | - - | - - | (3,322) | (3,322) | - - | (3,322) | ||||||||||
| Shares acquired by employees | (26) | - - | - - | - - | (26) | 26 | - - | - - | - - | - - | ||||||||||
| Issuance of shares upon the conversion of debentures | - - | - - | - - | - - | - - | 59 | - - | 59 | - - | 59 | ||||||||||
| Exercise of options upon the conversion of debentures | - - | - - | - - | (5) | (5) | 5 | - - | - - | - - | - - | ||||||||||
| Amortization of compensation costs related to the profit sharing program - stock ownership component | 103 | - - | - - | - - | 103 | - - | - - | 103 | - - | 103 | ||||||||||
| Balance as at June 28, 2014 | $ | 2,190 | $ | 5,137 | $ | 2 | $ | 5,759 | $ | 13,088 | $ | 168,147 | $ | 232,399 | $ | 413,634 | $ | 234 | $ | 413,868 |
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
Periods ended June 28, 2014 and June 29, 2013
| (in thousands of Canadian dollars) | Three months | Six months | ||||||||
| (unaudited) | 2014 | 2013 | 2014 | 2013 | ||||||
| Cash flows from the following activities: | ||||||||||
| Operating activities | ||||||||||
| Net income | $ | 4,501 | $ | 7,425 | $ | 5,051 | $ | 10,398 | ||
| Adjustments: | ||||||||||
| Amortization of compensation costs related to the profit sharing program - stock ownership component | 20 | 80 | 103 | 159 | ||||||
| Loss on revaluation of balances of purchase price of businesses | - - | - - | - - | 65 | ||||||
| Gain on disposal of investments | - - | (828) | - - | (867) | ||||||
| Loss on decline in value of an investment | - - | 431 | - - | 431 | ||||||
| Loss (gain) on disposal of property, plant and equipment | (37) | (110) | 73 | (107) | ||||||
| Gain on revaluation of property, plant and equipment | - - | (943) | - - | (943) | ||||||
| Depreciation of property, plant and equipment | 5,845 | 5,471 | 11,440 | 10,777 | ||||||
| Amortization of intangible assets | 483 | 401 | 956 | 778 | ||||||
| Amortization of deferred financing expenses | 95 | 83 | 188 | 165 | ||||||
| Provisions | (5) | (298) | 99 | (306) | ||||||
| Interest rate swaps | (29) | (243) | (97) | (335) | ||||||
| Imputed interest | 547 | 555 | 1,081 | 1,144 | ||||||
| Pension expense | (630) | (804) | (1,334) | (1,608) | ||||||
| Deferred tax expense | 882 | 984 | 2,081 | 1,116 | ||||||
| Share of loss (income) of a joint venture and associates | 39 | (36) | 321 | (340) | ||||||
| 11,711 | 12,168 | 19,962 | 20,527 | |||||||
| Net change in non-cash operating working capital balances | ||||||||||
| Increase in accounts receivable | (48,979) | (29,226) | (32,643) | (31,977) | ||||||
| Decrease (increase) in inventories | (11,628) | 5,508 | (27,098) | 6,488 | ||||||
| Increase in current tax assets | (1,868) | (18) | (1,868) | (18) | ||||||
| Decrease (increase) in prepaid expenses and other assets | 1,545 | 659 | (668) | (1,493) | ||||||
| Increase in accounts payable and accrued liabilities | 23,265 | 24,281 | 4,452 | 29,478 | ||||||
| Increase (decrease) in interest payable | (1,194) | (1,227) | 192 | (91) | ||||||
| Decrease in current tax liabilities | (493) | (524) | (7,592) | (4,662) | ||||||
| (39,352) | (547) | (65,225) | (2,275) | |||||||
| Cash flows from operating activities | (27,641) | 11,621 | (45,263) | 18,252 | ||||||
| Financing activities | ||||||||||
| Shares purchased by a trust in employees' name on the secondary market | - - | - - | - - | (651) | ||||||
| Repurchase of shares | - - | - - | - - | (39) | ||||||
| Dividends | - - | - - | (3,322) | - - | ||||||
| Increase in debt and bank loans | 38,972 | 2,811 | 67,928 | 4,961 | ||||||
| Repayment of debt and bank loans | (3,714) | (6,102) | (6,425) | (11,432) | ||||||
| Repayment of balances of purchase price of businesses | - - | - - | - - | (3,326) | ||||||
| Issue expenses related to long-term debt | - - | (30) | - - | (30) | ||||||
| Increase in other liabilities | 8 | - - | 16 | - - | ||||||
| Cash flows from financing activities | 35,266 | (3,321) | 58,197 | (10,517) | ||||||
| Investing activities | ||||||||||
| Proceeds from sale of property, plant and equipment | 77 | 131 | 119 | 178 | ||||||
| Additions to property, plant and equipment | (7,315) | (4,908) | (10,946) | (7,725) | ||||||
| Additions to intangible assets | (792) | (288) | (1,129) | (943) | ||||||
| Acquisition of an interest in an associate | (1,000) | - - | (1,000) | - - | ||||||
| Proceeds from disposal of investments | - - | 2,406 | - - | 2,743 | ||||||
| Distributions received | - - | - - | 156 | - - | ||||||
| Decrease in receivables and other assets | 4 | 152 | 182 | 491 | ||||||
| Increase in long-term receivables | - - | (27) | - - | (27) | ||||||
| Acquisition of business assets | (1,136) | (3,586) | (1,136) | (3,586) | ||||||
| Cash flows from investing activities | (10,162) | (6,120) | (13,754) | (8,869) | ||||||
| Effects of changes in foreign exchange rate on cash and cash equivalents | (1,557) | 138 | (1,372) | 306 | ||||||
| Net change in cash and cash equivalents | (4,094) | 2,318 | (2,192) | (828) | ||||||
| Cash and cash equivalents - Beginning of period | 6,592 | 3,641 | 4,690 | 6,787 | ||||||
| Cash and cash equivalents - End of period | $ | 2,498 | $ | 5,959 | $ | 2,498 | $ | 5,959 | ||
| Supplementary information | ||||||||||
| Interest paid | $ | 4,000 | $ | 4,500 | $ | 5,253 | $ | 5,955 | ||
| Income taxes paid, net | $ | 3,083 | $ | 2,292 | $ | 8,938 | $ | 7,560 | ||
SOURCE: Canam Group Inc.
François Bégin
Vice President, Communications
Canam Group Inc.
Telephone: 450-641-4000 / 1-866-506-4000
Email: [email protected]
Share this article