Comp Superstore Sales grow by 13.6%
Online Sales grow by 14.2%
TORONTO,
Nov. 3, 2015 /CNW/ - Indigo Books & Music Inc. (TSX: IDG),
Canada's largest book, gift and
specialty toy retailer reported 8.8% growth in revenue for its
second quarter ended September 26,
2015.
Revenue for the quarter was $205.7 million, up $16.7
million from last year, despite operating two fewer
superstores and four fewer small format stores. On a
comparable store basis, Indigo and Chapters superstores posted
13.6% growth, while Coles and IndigoSpirit small format stores
increased by 12.9%. Sales from Indigo's online channel, indigo.ca,
grew by 14.2%.
Revenue growth was driven by continued double
digit growth in the general merchandise business, mainly in Paper
and Toys, and strong growth in the core book business, boosted by
the trend for adult colouring books.
Commenting on the results, CEO Heather Reisman said, "We are pleased with this
quarter's results. Up against a tough comp from last year, we
have demonstrated that we are consistently growing the business and
improving profitability."
The net loss for the 13-week period ended
September 26, 2015 was $1.8 million (net loss per common share of
$0.07), compared to a loss of
$8.5 million (net loss per common
share of $0.33) for the period ended
September 27, 2014. The
improvement of $6.7 million was
driven by increased revenue performance and a higher margin
rate.
During the quarter Indigo launched a new
American Girl® Specialty Boutique at the Toronto Eaton Centre
store, alongside a complete renovation of the Books and Indigo Kids
sections. Additionally, the Company revitalized their plum®
rewards loyalty program to now include online collection and
redemption of plum® points and an enhanced suite of member benefits
based on customer feedback.
Analyst/Investor Call
Indigo will host a conference call for analysts
and investors to review these results at 10:00 a.m. (ET) tomorrow, November 4th, 2015. The call can be
accessed by dialling 416-764-8688 from within the Toronto area, or 1-888-390-0546 outside of
Toronto. The eight digit
participant code is 34060006.
A playback of the call will also be available by
telephone until 11:59 p.m. (ET) on
Wednesday November 11th, 2015.
The call playback can be accessed after 12:00 p.m. (ET) on November 4th, 2015, by dialing 416-764-8677 from
within the Toronto area, or
1-888-390-0541 outside of Toronto. The six-digit replay passcode
number is 060006#. The conference call transcript will be
archived in the Investor Relations section of the Indigo website,
www.indigo.ca.
Forward-Looking Statements
Statements contained in this news release that
are not historical facts are forward-looking statements which
involve risk and uncertainties that could cause results to differ
materially from those expressed in the forward-looking statements.
Among the key factors that could cause such differences are:
general economic, market or business conditions
in Canada; competitive
actions by other companies; changes in laws or regulations; and
other factors, many of which are beyond the control of the
Company.
Non-IFRS Financial Measures
The Company prepares its unaudited interim
condensed consolidated financial statements in accordance with
International Financial Reporting Standards and International
Accounting Standards 34, "Interim Financial Reporting." In
order to provide additional insight into the business, the Company
has also provided non-IFRS data, including comparative store sales
growth, in the press release above. This measure does not have a
standardized meaning prescribed by IFRS and is therefore specific
to Indigo and may not be comparable to similar measures presented
by other companies. Comparative store sales growth is a key
indicator used by the Company to measure performance against
internal targets and prior period results. This measure is commonly
used by financial analysts and investors to compare Indigo to other
retailers. Comparable store sales are defined as sales generated by
stores that have been open for more than 12 months on a 52-week
basis.
About Indigo
Books & Music Inc.
Indigo is a publicly traded Canadian company
listed on the Toronto Stock Exchange (IDG). As the largest book,
gift and specialty toy retailer in Canada, Indigo operates in all provinces under
different banners including Indigo
Books & Music; Indigo
Books, Gifts, Kids; Indigospirit; Chapters; and Coles. The
online channel, indigo.ca, offers a one-stop online shop with
a robust selection of books, toys, home décor, stationery, and
gifts.
Indigo founded the Indigo Love of Reading
Foundation in 2004 to address the underfunding of public
elementary school libraries. Every year the Indigo Love of Reading
Foundation grants $1.5
million to 20 high-needs elementary schools so they can
transform their libraries with the purchase of new books and
education resources. To date, the Indigo Love of Reading Foundation
has committed over $20.5 million to
over 2,000 schools through our signature programs.
To learn more about Indigo, please visit the Our
Company section at indigo.ca.
| Consolidated Balance
Sheets |
| (Unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
As at |
|
|
As at |
|
|
|
|
|
As at |
| |
|
|
|
|
|
September 26, |
|
|
September 27, |
|
|
|
|
|
March 28, |
| (thousands of Canadian dollars) |
|
|
|
|
|
2015 |
|
|
2014 |
|
|
|
|
|
2015 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Current |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash and cash equivalents |
|
|
|
|
|
176,199 |
|
|
149,429 |
|
|
|
|
|
203,162 |
| Accounts receivable |
|
|
|
|
|
18,616 |
|
|
12,778 |
|
|
|
|
|
4,896 |
| Inventories |
|
|
|
|
|
256,952 |
|
|
235,053 |
|
|
|
|
|
208,395 |
| Income taxes recoverable |
|
|
|
|
|
25 |
|
|
- |
|
|
|
|
|
25 |
| Prepaid expenses |
|
|
|
|
|
4,843 |
|
|
6,406 |
|
|
|
|
|
5,477 |
| Total current assets |
|
|
|
|
|
456,635 |
|
|
403,666 |
|
|
|
|
|
421,955 |
| Property, plant, and equipment |
|
|
|
|
|
52,955 |
|
|
55,845 |
|
|
|
|
|
54,886 |
| Intangible assets |
|
|
|
|
|
15,700 |
|
|
19,550 |
|
|
|
|
|
16,587 |
| Equity investment |
|
|
|
|
|
- |
|
|
- |
|
|
|
|
|
726 |
| Deferred tax assets |
|
|
|
|
|
44,241 |
|
|
44,604 |
|
|
|
|
|
44,241 |
| Total assets |
|
|
|
|
|
569,531 |
|
|
523,665 |
|
|
|
|
|
538,395 |
| LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Current |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Accounts payable and accrued liabilities |
|
|
|
|
|
208,805 |
|
|
175,396 |
|
|
|
|
|
160,645 |
| Unredeemed gift card liability |
|
|
|
|
|
42,249 |
|
|
40,773 |
|
|
|
|
|
48,211 |
| Provisions |
|
|
|
|
|
52 |
|
|
913 |
|
|
|
|
|
913 |
| Deferred revenue |
|
|
|
|
|
14,172 |
|
|
13,178 |
|
|
|
|
|
13,298 |
| Current portion of long-term debt |
|
|
|
|
|
112 |
|
|
316 |
|
|
|
|
|
172 |
| Total current liabilities |
|
|
|
|
|
265,390 |
|
|
230,576 |
|
|
|
|
|
223,239 |
| Long-term accrued liabilities |
|
|
|
|
|
2,618 |
|
|
2,398 |
|
|
|
|
|
3,841 |
| Long-term provisions |
|
|
|
|
|
91 |
|
|
97 |
|
|
|
|
|
110 |
| Long-term debt |
|
|
|
|
|
21 |
|
|
133 |
|
|
|
|
|
56 |
| Total liabilities |
|
|
|
|
|
268,120 |
|
|
233,204 |
|
|
|
|
|
227,246 |
| Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Share capital |
|
|
|
|
|
206,472 |
|
|
204,601 |
|
|
|
|
|
205,871 |
| Contributed surplus |
|
|
|
|
|
10,232 |
|
|
9,366 |
|
|
|
|
|
9,770 |
| Retained earnings |
|
|
|
|
|
84,707 |
|
|
76,494 |
|
|
|
|
|
95,508 |
| Total equity |
|
|
|
|
|
301,411 |
|
|
290,461 |
|
|
|
|
|
311,149 |
| Total liabilities and equity |
|
|
|
|
|
569,531 |
|
|
523,665 |
|
|
|
|
|
538,395 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Consolidated Statements of Loss
and Comprehensive Loss |
| (Unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
13-week |
|
|
13-week |
|
|
26-week |
|
|
26-week |
| |
|
|
period ended |
|
|
period ended |
|
|
period ended |
|
|
period ended |
| |
|
|
September 26, |
|
|
September 27, |
|
|
September 26, |
|
|
September 27, |
| (thousands of Canadian dollars, except per share
data) |
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|
2014 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
|
205,722 |
|
|
189,030 |
|
|
390,616 |
|
|
369,832 |
| Cost of sales |
|
|
(112,102) |
|
|
(105,707) |
|
|
(215,612) |
|
|
(206,556) |
| Gross profit |
|
|
93,620 |
|
|
83,323 |
|
|
175,004 |
|
|
163,276 |
| Operating, selling, and administrative
expenses |
|
|
(95,582) |
|
|
(92,175) |
|
|
(185,801) |
|
|
(185,985) |
| Operating loss |
|
|
(1,962) |
|
|
(8,852) |
|
|
(10,797) |
|
|
(22,709) |
| Interest on long-term debt and financing
charges |
|
|
(3) |
|
|
(20) |
|
|
(5) |
|
|
(29) |
| Interest income on cash and cash equivalents |
|
|
336 |
|
|
411 |
|
|
727 |
|
|
788 |
| Share of loss from equity investment |
|
|
(219) |
|
|
(79) |
|
|
(726) |
|
|
(598) |
| Net loss and comprehensive loss for the
period |
|
|
(1,848) |
|
|
(8,540) |
|
|
(10,801) |
|
|
(22,548) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Net loss per common share |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
$ |
(0.07) |
|
$ |
(0.33) |
|
$ |
(0.42) |
|
$ |
(0.88) |
| Diluted |
|
$ |
(0.07) |
|
$ |
(0.33) |
|
$ |
(0.42) |
|
$ |
(0.88) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Consolidated Statements of Cash
Flows |
| (Unaudited) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
13-week |
|
|
13-week |
|
|
26-week |
|
|
26-week |
| |
|
|
|
|
|
period ended |
|
|
period ended |
|
|
period ended |
|
|
period ended |
| |
|
|
|
|
|
September
26, |
|
|
September
27, |
|
|
September
26, |
|
|
September
27, |
| (thousands of Canadian dollars) |
|
|
|
|
|
2015 |
|
|
2014 |
|
|
2015 |
|
|
2014 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| CASH FLOWS FROM OPERATING
ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net loss for the period |
|
|
|
|
|
(1,848) |
|
|
(8,540) |
|
|
(10,801) |
|
|
(22,548) |
| Add (deduct) items not affecting
cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Depreciation of property, plant, and
equipment |
|
|
|
|
|
3,580 |
|
|
3,635 |
|
|
7,164 |
|
|
7,333 |
| |
Amortization of intangible assets |
|
|
|
|
|
2,206 |
|
|
2,981 |
|
|
4,660 |
|
|
5,849 |
| |
Loss on disposal of capital assets |
|
|
|
|
|
1 |
|
|
2 |
|
|
660 |
|
|
9 |
| |
Share-based compensation |
|
|
|
|
|
278 |
|
|
163 |
|
|
610 |
|
|
498 |
| |
Directors' compensation |
|
|
|
|
|
85 |
|
|
62 |
|
|
196 |
|
|
166 |
| |
Other |
|
|
|
|
|
(3,090) |
|
|
(1,686) |
|
|
(2,651) |
|
|
(541) |
| Net change in non-cash working capital
balances |
|
|
|
|
|
967 |
|
|
4,573 |
|
|
(20,674) |
|
|
8,160 |
| Interest on long-term debt and
financing charges |
|
|
|
|
|
3 |
|
|
20 |
|
|
5 |
|
|
29 |
| Interest income on cash and cash
equivalents |
|
|
|
|
|
(336) |
|
|
(411) |
|
|
(727) |
|
|
(788) |
| Share of loss from equity
investment |
|
|
|
|
|
219 |
|
|
79 |
|
|
726 |
|
|
598 |
| Cash flows from (used in) operating
activities |
|
|
|
|
|
2,065 |
|
|
878 |
|
|
(20,832) |
|
|
(1,235) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| CASH FLOWS FROM INVESTING
ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Purchase of property, plant, and
equipment |
|
|
|
|
|
(3,644) |
|
|
(2,551) |
|
|
(5,897) |
|
|
(4,711) |
| Addition of intangible assets |
|
|
|
|
|
(2,370) |
|
|
(1,808) |
|
|
(3,774) |
|
|
(3,812) |
| Proceeds from disposal of capital
assets |
|
|
|
|
|
5 |
|
|
- |
|
|
5 |
|
|
- |
| Interest received |
|
|
|
|
|
259 |
|
|
411 |
|
|
486 |
|
|
788 |
| Cash flows used in investing
activities |
|
|
|
|
|
(5,750) |
|
|
(3,948) |
|
|
(9,180) |
|
|
(7,735) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| CASH FLOWS FROM FINANCING
ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Repayment of long-term debt |
|
|
|
|
|
(44) |
|
|
(180) |
|
|
(95) |
|
|
(366) |
| Interest paid |
|
|
|
|
|
(17) |
|
|
(21) |
|
|
(34) |
|
|
(31) |
| Proceeds from share issuances |
|
|
|
|
|
53 |
|
|
340 |
|
|
257 |
|
|
671 |
| Cash flows from (used in) financing
activities |
|
|
|
|
|
(8) |
|
|
139 |
|
|
128 |
|
|
274 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign currency exchange
rate changes
on cash and cash equivalents |
|
|
|
|
|
3,181 |
|
|
1,693 |
|
|
2,921 |
|
|
547 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash
equivalents
during the period |
|
|
|
|
|
(512) |
|
|
(1,238) |
|
|
(26,963) |
|
|
(8,149) |
| Cash and cash equivalents, beginning
of period |
|
|
|
|
|
176,711 |
|
|
150,667 |
|
|
203,162 |
|
|
157,578 |
| Cash and cash equivalents, end of
period |
|
|
|
|
|
176,199 |
|
|
149,429 |
|
|
176,199 |
|
|
149,429 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE Indigo Books & Music
Inc.