BMTC GROUP INC. ANNOUNCES FINANCIAL RESULTS FOR THE YEAR ENDED JANUARY 31st, 2022.

MONTREAL, April 25, 2022 /CNW Telbec/ -

Results 

For the year ended January 31, 2022, the Company's revenues increased by $170,389,000 to $819,445,000 compared to $649,056,000 recorded for the year ended January 31, 2021, a 26.3% increase. Net earnings for the year ended January 31, 2022 amounted to $81,931,000 compared to $54,842,000 recorded for the year ended January 31, 2021. Basic net earnings per share amounted to $2.43 compared to $1.61 recorded for the year ended January 31, 2021.

For the year ended January 31, 2022, the share repurchase program contributed to an increase in basic earnings of $0.02 per share, whereas during the year ended January 31, 2022, it contributed to an increase of $0.01 on basic net earnings per share.

The Company met the eligibility criteria for the Canadian Emergency Wage Subsidy (CEWS) during the quarter ended April 30, 2021. The Company received $1,441,000 after-tax which contributed to an increase of $0.04 on basic net earnings per share compared to $5,759,000 $ after-tax for the year ended January 31, 2021 which contributed to an increase of $0.17 on basic net earnings per share.

The Company has chosen to provide readers in this annual management report the results for the years ended January 31, 2020, and 2019 in addition to those of January 31, 2021. Management believes that the results for the year ended January 31, 2021 are not representative of the normal course results of the company. The impact of COVID-19 on the year ended January 31, 2021, makes it difficult to compare and analyze the results.

The variation in adjusted net earnings would be $31,407,000 or $0.93 per basic share for the year ended January 31, 2022, as well as the comparable years ended of January 31, 2021, 2020 and 2019 are explained as follows:



 ($ in thousands) 



January, 31 
2022


January, 31 
2021


January, 31 
2020


 January, 31 
2019










Net earnings


81 931


54 842


36 034


45 165

Gain on disposal of fixed assets (after-tax)


-


-


(1 048)


(4 522)

Variation in cost of options (after-tax)


-


-


(87)


(226)

CEWS (after-tax)


(1 441)


(5 759)


-


-

Adjusted net earnings


80 490


49 083


34 899


40 417

 

Minus: Adjusted net earnings for the previous period


49 083


34 899


40 417


49 513

Variation


31 407


14 184


(5 518)


(9 096)

The variations in net adjusted earnings is allocated throughout the quarters as follows for the years ended January 31, 2022, 2021, 2020 and 2019:








Increase


Increase


Increase


(decrease)


(decrease)


(decrease)


in adjusted


in retail operations


in investment


net earnings



















As at April 30, 2021

5 733


15 929


21 662

As at July 31, 2021

7 524


1 580


9 104

As at Oct 31, 2021

340


2 724


3 064

As at Jan. 31, 2022

1 419



(3 842)



(2 423)

Total

15 016


16 391


31 407







As at April 30, 2020

784


(9 695)


(8 911)

As at July 31, 2020

1 707


4 416


6 123

As at Oct 31, 2020

7 897


(1 616)


6 281

As at Jan. 31, 2021


4 905



5 786



10 691

Total

15 293


(1 109)


14 184








Increase


Increase


Increase


(decrease)


(decrease)


(decrease)


in adjusted


in retail operations


in investment


net earnings













As at April 30, 2019

(5 586)


1 924


(3 662)

As at July 31, 2019

(1 681)


(1 772)


(3 453)

As at Oct 31, 2019

(3 249)


2 333



(916)

As at Jan. 31, 2020


230



2 283



2 513

Total

(10 286)


4 768


(5 518)
















As at April 30, 2018

1 934


(1 815)


119

As at July 31, 2018

1 870


1 095


2 965

As at Oct 31, 2018

(6 242)


231



(6 011)

As at Jan. 31, 2019


(6 367)



198



(6 169)

Total

(8 805)


(291)


(9 096)

Annual financial information
($ in thousands, except for per share amounts)





January 31,
2022


Januray 31,
2021


January 31,
2020


January 31,
2019





$


$


$


$

Revenue


819 445


649 056


720 169


742 474

Net earnings




81 931


54 842


36 034


45 165

Total assets




549 926


450 207


382 040


367 624

 

Net earnings per share










  Basic and diluted


2,43


1,61


1,05


1,29

Dividends per share



0,34


0,29


0,28


0,28













Financial position and dividends

Cash, net of the bank overdraft, and investments increased by $62,234,000 during the year ended January 31, 2022. Investments consist of treasuries bearing interest, government and corporate bonds and common shares, which at the close of the year had a market value of $237,326,000 (including cash net of bank overdraft).

As at January 31, 2022, the working capital showed a deficit of $369,000, a decrease of $34,237,000 compared to the year ended January 31, 2021. The Company's shareholders' equity increased from $270,708,000 as at January 31, 2021, to $387,866,000 as at January 31, 2022. As at January 31, 2022, the book value per share stood at $11.60, compared to $7.99 as at January 31, 2021.

Pursuant to the normal course issuer-bid put in place on April 15, 2020, and renewed on April 15, 2021, accordingly, 457,000 common shares were repurchased and cancelled by the Company. As a result of this change, the Company had as at January 31, 2022, 33,423,000 common shares issued and outstanding.

During the year ended January 31, 2022, no options were granted. The Company may still grant pursuant to the Plan a total of 5,710,864 options, representing 17.09% of the issued and outstanding shares of the Company.

During the fiscal year ended January 31, 2021, the Company paid eligible dividends totalling $0.34 per common share to holders.

Quarterly results
($ in thousands, except for per share amounts)


April 30


April 30


April 30


April 30


2021


2020


2019


2018









Revenue

177 208


100 445


150 310


162 754

Net (loss) earnings

10 479


(12 427)


(3 455)


4 806

Net (loss) earnings per share








                  Basic and diluted

0,31


(0,36)


(0,10)


0,13










July 31


July 31


July 31


July 31


2021


2020


2019


2018









Revenue

231 624


175 973


215 067


220 368

Net earnings

28 683


19 579


13 480


16 933

Net earnings per share








               Basic and diluted

0,85


0,57


0,39


0,48


October 31


October 31


October 31


October 31


2021


2020


2019


2018









Revenue

213 955


194 352


183 312


184 718

Net earnings

20 189


20 775


10 649


11 613

Net earnings per share








                 Basic and diluted

0,67


0,61


0,31


0,34










January 31


January 31


January 31


January 31


2022


2021


2020


2019

















Revenue

196 658


178 286


171 480


174 634

Net earnings

22 580


26 915


15 360


11 813

Net earnings per share








                 Basic and diluted

0,67


0,79


0,45


0,34

For the three month period ended January 31, 2022, the Company's revenues increased by $18,372,000 to $196,658,000, compared to $178,286,000 recorded for the corresponding 2021 period, a 10.3% increase.  Net earnings for the three month period ended January 31, 2022, amounted to $22,580,000 compared to $26,915,000 recorded for the corresponding 2021 period. Basic net earnings per share decreased to $0.67 compared to $0.79 for the corresponding 2021 period.

For the three month period ended January 31, 2022, the share repurchase program contributed to an increase in basic earnings of $0.01 per share where during the corresponding 2021 period, it had no impact on basic net earnings or losses per share.

The Company determined that it met the eligibility criteria and applied for the Canadian Emergency Wage Subsidy (CEWS) during the quarter ended January 31, 2021. The Company received $1,912,000 after-tax which contributed to an increase of $0.06 on basic net earnings per share.

The variation in adjusted net earnings would be ($2,423,000) or ($0.07) per basic share for the three month period ended January 31, 2022, as well as the comparable periods ended of 2021, 2020 and 2019 are explained as follows:



($ in thousands) 



January 31,  2022


January 31, 2021


January 31, 2020


 January 31,    2019










Net earnings


22 580


26 915


15 360


11 813

Gain on disposal of fixed assets (after-tax)


-


-


(1 048)


-

Variation of cost of options (after-tax)


-


-


-


(14)

CEWS (after-tax)


-


(1 912)


-


-

Adjusted net earnings


22 580


25 003


14 312


11 799

 

Moins: Résultat net ajusté de la période précédente


25 003


14 312


11 799


17 968










Variation


(2 423)


10 691


2 513


(6 169)

Operations

Brault & Martineau Division

The Brault & Martineau store, at 500 boulevard Le Corbusier in Laval, ceased its operations on December 5, 2021. As announced earlier this year, the company entered into a partnership agreement for the development of this property into several residential rental towers. The real estate development will begin in the year 2022.

Management discussion and outlook for the Future of the Company

On March 11th, 2020, the World Health Organization declared COVID-19 a global pandemic. The financial impact of COVID-19 began to manifest itself by a decrease in store traffic and consequently store revenues in the early weeks of March 2020. Following the rapid rise of COVID-19 cases in the province of Quebec, our priority during this difficult period remains at all times the health and safety of our employees and clients. In order to protect the Quebec population and to prevent the spread of COVID-19 by encouraging social distancing initiatives recommended by both levels of government, the Company decided on March 18th, 2020, to temporarily close its retail sales network, namely our Ameublements Tanguay subsidiary in the Quebec City area and the Brault & Martineau and EconoMax banners in the Montreal area. On March 23rd, 2020, the Quebec government announced, for the same reason, the closure of all non-essential retail stores across the province.

In order to address the devastating effects of COVID-19 and to assure its short and long-term financial health, the Company decided to maintain its operations at a strict minimum level while preserving its presence in our market and controlling its working capital position. The following actions were undertaken by the Company during these last weeks in order to support its operating and working capital objectives:

  • Following the closure of our retail sales network on March 18th, 2020, the Company temporarily laid off approximately 75% of its personnel, the vast majority stemming from our retail stores.
  • Our online and delivery services remained operational across Quebec to ensure the population in confinement the ability to rely on essential goods while respecting government-mandated security protocols. We modified our services to offer contactless home delivery.
  • During this period, the Company introduced several measures and protocols in preparation for the reopening of our stores across our sales network to ensure and protect the health and security of our employees and our clients. These new measures and protocols will be in effect until the end of the COVID-19 pandemic.
  • The Company has also made technological and operational improvements to its sales network. These modifications will allow us to reduce our fixed costs and will contribute to our initiatives of effective cost controls.
  • The Company applied for the Canada Emergency Wage Subsidy given the 30% or more decrease in revenues during the prescribed period (CEWS).

During the first quarter of 2020, the Company had all of its 32 points of sale closed for a period of 43 consecutive days, leaving only online sales operational. The loss of revenues arising from the store closures during this period amounted to $52,029,000. During the second quarter of 2020, the Company had 15 points of sale closed for a period of 25 consecutive days, leaving only online sales operational. The loss of revenues arising from the store closures during this period amounted to $25,465,000.

The Company has proactively aligned its cost structure in order to mitigate the loss of revenues incurred during the last fiscal year due to the store closures. The Company intends to maintain these measures throughout the fiscal year 2022, in order to protect the Company's viability and preserve its working capital during these highly uncertain times. Thanks to these new measures the Company believes it will be able to produce positive operating results.

The Company continues to focus on online sales, which experienced a record increase since the start of the pandemic, by actively pursuing the improvement of its digital platforms, its live chat initiative with online customers as well as the improvement of our telephone sales department for all of the BMTC Group Inc. banners.

It is also Management's opinion that the digital platforms of our banners are essential in order to allow the Company to increase its market shares as well as to allow customers to start their shopping experience online to then complete their purchases in one of our stores with the help of our sales representatives.

The Company was able to increase significantly it's revenues during the year ended January 31, 2022 compared to results during the corresponding 2021 period as well as the corresponding 2020 and 2019 periods. In fact, the Company recorded one of the highest revenues in its history. This is partly due to improvements in marketing and strategic measures implemented, our extensive store network and the strength of digital platforms, which have enabled the Company to increase its market share in Quebec.

Since mid-June 2021, the Company has had issues with its supply logistics. Many of the Company's suppliers, who have also been affected by the consequences of COVID-19, are unable to honour and deliver placed orders. This problem seems widespread in our industry and is not unique to the Company.

On May 5, 2021, the Canadian federal government imposed important tariffs on upholstered furniture imported from Vietnam and China while not allowing any grace period either for orders in production or for products already in transit to Canada, which can take up 3 to 4 months to reach our ports.

Complaints about unfairly priced Chinese and Vietnamese-made products have been a long simmering issue in the furniture business. Although, when the Canadian federal government announced it was seeking to level the playing fields with tariffs, everyone in the industry was expecting tariffs in the range of 10 to 20 per cent, similar to what the U.S. recently implemented.

It is difficult to predict the future level of consumer spending, although it is quite possible that the Company's future results may not reflect the performance of the last two years. The high level of inflation combined with gas prices will have an impact on consumer spending. Also, management is aware that the increase in the last two years was partly due to the fact that the Company benefited from a transfer of consumer spending related to the restrictions imposed by the various levels of government due to COVID-19 pandemic, more precisely the restrictions related to travel, the closure of restaurants and all other forms of entertainment in the cultural and sporting world. Since these restrictions are no longer in place, we expect consumer spending could transfer back to these types of spending.

Management is confident that the Company's operational efficiency during this crisis, its market leadership and solid financial position will allow us to emerge a stronger organization despite these difficult market conditions and maintain its objectives increasing its market share and profitability in Quebec.

Caution regarding forward-looking statements

This press release 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 opposites 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 2022 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 press release. 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 press release 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 the performance measures and financial recurrence of the Company. Management believes that this measure is useful in understanding and analyzing the operational performance of the Company and that it can provide additional information.

Adjusted net earnings as well as same store revenues are not an earnings measure recognized by IFRS and do not have a standardized meanings prescribed by IFRS. Therefore, adjusted net earnings and same store revenues as discussed in this press release may not be compared to similar measures presented by other issuers. These measures of performance should not be considered as alternatives to indicators of performance calculated according to IFRS, but rather as a source of additional information.

The Company discloses in this press release under the section "Results" a reconciliation between net earnings and adjusted net earnings.

BMTC Group Inc. is a company governed the Business Companies Act (Quebec). Its registered office and principal place of business is located at 8500 Place Marien, Montréal East, Quebec, H1B 5W8. Its common shares are listed on the Toronto Stock Exchange. The Company, through its subsidiaries Ameublements Tanguay Inc., Le Corbusier-Concorde S.E.C.  and its two divisions Brault & Martineau and EconoMax, manages and operates a retail network of furniture, household appliances and electronic products, in Quebec.

SOURCE BMTC Group Inc.

View original content: http://www.newswire.ca/en/releases/archive/April2022/25/c4498.html

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