Improved profitability in fiscal 2020 and
demonstrated strength of omni-channel capabilities with
eCommerce sales up more than 60% for the quarter
TORONTO, April 8, 2021 /CNW/ - Roots ("Roots," "Roots
Canada" or the "Company") (TSX: ROOT), a premium outdoor-lifestyle
brand, today announced its financial results for its fiscal year
and fourth quarter ended January 30,
2021 ("F2020" and "Q4 2020", respectively). All financial
results are reported in Canadian dollars unless otherwise stated.
Certain metrics, including those expressed on an adjusted basis,
are non-IFRS measures. See "Non-IFRS Measures and Industry
Metrics".
Fiscal 2020 Business Highlights
- Demonstrated strength of the Company's market position around
comfort and quality with increased demand for major product
categories and positive sell-throughs of new products, driving
substantial gross margin expansion.
- Increased eCommerce sales 50% year-over-year, partially
offsetting the impact of pandemic-related store closures for 31% of
the year (35% for Q4 2020), and generated nearly 50% of F2020
Direct-to-Consumer ("DTC") sales online, facilitated by the
Company's omni-channel platform.
- Improved profitability year-over-year by actively managing
costs across all areas of the business.
- Achieved profitability in the U.S. with transition to a
digitally-led strategy, including closing seven stores, which
resulted in the elimination of significant Adjusted EBITDA losses
and eCommerce growth rates in excess of 65% in the fourth
quarter.
- Effectively managed liquidity with a 53% year-over-year
increase in available liquidity as at the end of F2020 and a
reduction in leverage from 3.7x fiscal 2019 ("F2019") Adjusted
EBITDA to 1.6x F2020 Adjusted EBITDA.
- Repurposed a portion of Company-operated leather factory for
non-medical face mask production, establishing a new revenue stream
and donating a portion of the proceeds to charity
- Donated more than $2.0 million in
products and financial support to charitable organizations across
Canada.
Fiscal 2020 Financial Highlights
- Total sales of $240.5 million,
compared to $329.9 million in
F2019.
-
- DTC sales of $208.2 million,
compared to $287.8 million in
F2019.
- Gross margin of 58.1%, compared to 53.4% in F2019.
-
- DTC Gross Margin of 61.1%, up 490 basis points from 56.2% in
F2019.
- Selling, general and administrative expenses of $113.9 million (excluding fixed asset impairment
of $0.9 million), down from
$169.1 million in F2019 (excluding
fixed asset impairment of $19.2
million).
- Adjusted EBITDA of $38.7 million,
a 48.6% increase from $26.1 million
in F2019.
- Net income per share of $0.31,
improved from a net loss per Share of ($1.47) in F2019.
- Adjusted Net Income per Share of $0.39, improved from $0.10 per Share in F2019.
Fourth Quarter Fiscal 2020 Highlights
- Total sales of $99.4 million,
compared to $127.5 million in the
fourth quarter of
fiscal 2019 ("Q4 2019").
-
- DTC sales of $91.8 million,
compared to $119.1 million in Q4
2019.
- Gross margin of 59.2%, compared to 54.4% in Q4 2019.
-
- DTC Gross Margin of 59.8%, up 460 basis points from 55.2% in Q4
2019.
- Selling, general and administrative expenses of $38.1 million (excluding fixed asset impairment
of $0.9 million), down from
$50.2 million in Q4 2019 (excluding
fixed asset impairment of $19.2
million).
- Adjusted EBITDA of $26.1 million,
in line with $26.1 million in Q4
2019.
- Net income per share of $0.29,
improved from a net loss per Share of ($1.06) in Q4 2019.
- Adjusted Net Income per Share of $0.39, improved from $0.31 per Share in Q4 2019.
"In fiscal 2020, we navigated unprecedented disruption in our
industry; however, as a result of the team's resilience,
determination and passion, we ended the year stronger than we
started," said Meghan Roach,
President and Chief Executive Officer, Roots. "Our performance
reflects the strength of the Roots brand, the loyalty of our
customer base, and the capabilities of our omni-channel platform.
As a brand known for comfort and quality, our products continued to
resonate with customers, and our disciplined approach to
promotional activity, focus on cost controls, and efficiencies at
our distribution centre strengthened our bottom-line results."
Ms. Roach added: "Despite the fact that most of our retail
locations were closed during what is typically our busiest and most
productive time of the year, we were able to deliver profitability
for the fourth quarter that was in line with the previous year when
all of our stores were open. While we continue to face government
mandated temporary store closures in Q1 2021, we are confident in
our capabilities to manage the business through these challenging
times."
Summary of Fiscal 2020 Full-Year and Fourth Quarter
Results
Sales
Total F2020 sales were $240.5
million, down 27.1% from total sales of $329.9 million in F2019. F2020 DTC sales
(corporate retail store and eCommerce sales) were $208.2 million, down from $287.8 million in F2019. The year-over-year
decrease was predominantly due to a decline in store sales as a
result of COVID-19 impacts, including government mandated temporary
store closures, traffic declines, capacity limitations, and reduced
store operating hours. These headwinds were partially offset by
strong eCommerce sales, which increased more than 50% over
F2019.
For Q4 2020, typically the Company's seasonally strongest
quarter, total sales were $99.4
million, down 22.0% from total sales of $127.5 million in Q4 2019. Q4 2020 DTC sales were
$91.8 million, down from $119.1 million in Q4 2019. The year-over-year
decline was predominantly a result of the aforementioned COVID-19
impacts, in particular, temporary store closures in certain markets
as a result of a second wave of the COVID-19 virus. These headwinds
were partially offset by strong eCommerce sales, which increased
more than 60% over Q4 2019.
Roots F2020 Partners and Other sales (wholesale Roots-branded
products, royalties on partner retail sales, licensing to select
manufacturing partners and the sale of certain custom Roots-branded
products) were $32.3 million, down
from $42.1 million in F2019,
primarily reflecting COVID-19-related declines in the Company's
Asia partner wholesale purchases
and decreases in demand in the Company's licensing and wholesale
businesses. For Q4 2020, Partners and Other sales were $7.6 million, down from $8.4 million in Q4 2019.
Gross Profit
As a result of the negative impact of
COVID-19 on overall sales, Roots F2020 total gross profit was
$139.7 million, down from
$176.2 million in F2019. For Q4 2020,
total gross profit was $58.9 million,
down from $69.3 million in Q4
2019.
F2020 Gross Margin was 58.1%, up from 53.4% in F2019. Gross
Margin for Q4 2020 was 59.2%, up from 54.4% in Q4 2019. The
470-basis point and 480-basis point improvement for F2020 and Q4
2020, respectively, predominantly reflects the Company's decision
to decrease promotional breadth and depth year-over-year. While the
reductions in promotions likely placed some downward pressure on
sales in the short term, the Company believes it is beneficial to
the brand and profitability of the business over the long term.
Selling, General and Administrative Expenses
("SG&A")
F2020 SG&A was $113.9 million (excluding fixed asset impairment
of $0.9 million), down from
$169.1 million in F2019 (excluding
fixed asset impairment of $19.2
million). The year-over-year decrease predominantly reflects
$37.6 million in savings driven by
the Company's efforts to reduce costs across all areas of the
business as a result of COVID-19. Roots realized savings related to
lower overall store wages as a result of government-mandated
temporary store closures, reduced store operating hours and labour
managed in accordance with store sales, as well as the management
of overall corporate costs, including rent savings of $7.5 million.
F2020 SG&A also reflects $0.7
million in government rent subsidies and $9.6 million in government wage subsidies (of the
total $12.8 million wage subsidy
benefit the Company recognized in the year). In addition, the
Company realized $7.3 million in
SG&A savings associated with the Company's U.S. business,
predominantly as a result of the permanent closure of seven U.S.
corporate retail stores in the first quarter of fiscal 2020 ("Q1
2020").
For Q4 2020, SG&A was $38.1
million (excluding fixed asset impairment of $0.9 million), down from $50.2 million in Q4 2019 (excluding fixed asset
impairment of $19.2 million). The
year-over-year decrease predominantly reflects $7.3 million in COVID-19-related cost reductions
as mentioned above, including $1.7
million in rent savings.
Q4 2020 SG&A also reflects $0.7
million in government rent subsidies and $1.2 million in government wage subsidies (of the
total $1.6 million wage subsidy
benefit the Company recognized in the quarter) and $3.0 million in SG&A savings associated with
the Company's U.S. business, predominantly as a result of the
permanent closure of seven U.S. corporate retail stores in Q1
2020.
Adjusted EBITDA, Net Income (Loss) & Adjusted Net Income
(Loss)
Reflecting factors discussed above, Adjusted EBITDA
(which excludes the impact of IFRS 16, Leases ("IFRS 16")
and non-cash impairments) was $38.7
million for F2020, a 48.6% increase from $26.1 million
in F2019. F2019 includes ($6.1)
million of losses related to the Company's now-closed U.S.
corporate retail stores. Adjusted EBITDA for Q4 2020 was
$26.1 million, consistent with
$26.1 million in Q4 2019. Q4 2019
includes ($2.0) million of losses
related to the Company's now-closed U.S. corporate retail
stores.
F2020 net income improved to $13.1
million, or $0.31 per share,
from a net loss of ($62.0) million,
or ($1.47) per share, which includes
a goodwill impairment of $44.8
million. Adjusted Net Income (which excludes the impact of
IFRS 16 and non-cash impairments) improved to $16.5 million for F2020, or $0.39 per share, from $4.0
million, or $0.10 per share,
in F2019.
Q4 2020 net income improved to $12.3
million, or $0.29 per share,
from a net loss of ($44.6) million,
or ($1.06) per share, in Q4 2019,
which also includes the goodwill impairment discussed above.
Adjusted Net Income (which excludes the impact of IFRS 16 and
non-cash impairments) for Q4 2020 was $16.3
million, or $0.39 per share,
and increase from $13.3 million, or
$0.31 per share, in Q4 2019.
COVID-19 Business Update
In the fourth quarter of
2020, in response to a second wave of government mandated
lockdowns, the Company temporarily closed corporate retail stores
within certain regions of Canada.
As of March 11, 2021, the Company had
reopened all but two corporate retail stores in these regions.
This month, in accordance with further changes to provincial
guidelines, the Company has shifted its store operations to
curbside pick-up and eCommerce fulfillment only for certain regions
in Québec, effective April 2, 2021,
and for the province of Ontario,
effective April 8, 2021. This
represents two corporate-retail stores in Québec, as well as 62
corporate-retail stores and five pop-up locations in Ontario. The changes in operation for these
locations will be in place for at least 10 days in Québec and four
weeks in Ontario.
Conference Call and Webcast Information
Roots will
hold a conference call to discuss the Company's fiscal 2020
year-end and fourth quarter results on April
8, 2021, at 8:00 a.m. ET. All
interested parties can join the call by dialing 647-427-7450 or
1-888-231-8191 and using conference ID: 5195015. Please dial in 15
minutes prior to the call to secure a line. The conference call
will be archived for replay until April 15,
2021, at midnight and can be accessed by dialing
416-849-0833 or 1-855-859-2056 and entering replay passcode:
5195015.
A live audio webcast of the conference call will be available on
the Events and Presentations section of the Company's investor
website at https://investors.roots.com or by following the link
here. Please connect at least 15 minutes prior to the conference
call to ensure adequate time for any software download that may be
required to join the webcast. An archived replay of the webcast
will be available on the Company's website for one year.
See Roots Consolidated Financial Statements and the Company's
Management's Discussion and Analysis of Financial Condition and
Results of Operations for the fiscal year and fourth quarter ended
January 30, 2021, on the Company's
investor website at https://investors.roots.com and on SEDAR
at www.SEDAR.com.
About Roots
Established in 1973, Roots is a premium
outdoor-lifestyle brand. We unite the best of cabin and city
through unmistakable style built with uncompromising comfort and
quality. We offer a broad range of products designed for life's
everyday adventures, including women's and men's apparel, leather
goods, footwear, accessories, and kids, toddler and baby apparel.
Starting from a little cabin in Algonquin
Park, Canada, Roots has grown to become a global brand. As
of January 30, 2021, we operated 111
corporate-retail stores in Canada,
two corporate-retail stores in the United
States, 117 partner-operated stores in Taiwan, 26 partner-operated stores in
China, two partner-operated stores
in Hong Kong and a global
eCommerce platform, roots.com. Roots Corporation is a Canadian
corporation doing business as "Roots" and "Roots Canada".
Non-IFRS Measures and Industry Metrics
Roots has
historically reported Comparable Sales Growth (Decline) as an
additional metric to demonstrate the performance of its DTC
business. However, as a result of the negative impacts COVID-19 has
had on the apparel retail operating environment, including periods
of store closures, phased re-openings and retail store operating
limitations, the Company does not believe that Comparable Sales
Growth (Decline) is a representative metric of fiscal 2020
performance.
This press release makes reference to certain non-IFRS measures
including certain metrics specific to the industry in which we
operate. These measures are not recognized measures under IFRS, do
not have a standardized meaning prescribed by IFRS and, therefore,
may not be comparable to similar measures presented by other
companies. Rather, these measures are provided as additional
information to complement those IFRS measures by providing further
understanding of our results of operations from management's
perspective. Accordingly, these measures are not intended to
represent, and should not be considered as alternatives to net
income or other performance measures derived in accordance with
IFRS as measures of operating performance or operating cash flows
or as a measure of liquidity. In addition to our results determined
in accordance with IFRS, we use non-IFRS measures including DTC
Gross Margin, EBITDA, Adjusted EBITDA, Adjusted Net Income (Loss),
and Adjusted Net Income (Loss) per Share. We believe these non-IFRS
measures and industry metrics provide useful information to both
management and investors in measuring our financial performance and
condition and highlight trends in our core business that may not
otherwise be apparent when relying solely on IFRS measures.
Definitions and reconciliations of non-IFRS measures to the
relevant reported measures can be found in our MD&A under
"Cautionary Note Regarding Non-IFRS Measures and Industry Metrics",
which is available on SEDAR at www.sedar.com or the Company's
Investor Relations website at https://investors.roots.com.
Forward-Looking Information
Certain information in
this press release contains forward-looking information. This
information is based on management's reasonable assumptions and
beliefs in light of the information currently available to us and
are made as of the date of this press release. Actual results and
the timing of events may differ materially from those anticipated
in the forward-looking information as a result of various factors.
Information regarding our expectations of future results,
performance, achievements, prospects or opportunities or the
markets in which we operate is forward-looking information.
Statements containing forward-looking information are not facts but
instead represent management's expectations, estimates and
projections regarding future events or circumstances. Many factors
could cause our actual results, level of activity, performance or
achievements or future events or developments to differ materially
from those expressed or implied by the forward-looking
statements.
See "Forward-Looking Information" and "Risk Factors" in the
Company's current Annual Information Form for a discussion of the
uncertainties, risks and assumptions associated with these
statements. Readers are urged to consider the uncertainties, risks
and assumptions carefully in evaluating the forward-looking
information and are cautioned not to place undue reliance on such
information. We have no intention and undertake no obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except as
required by applicable securities law.
ROOTS
Corporation Consolidated Statement of Financial Position
(In thousands of Canadian dollars)
|
|
As at January 30,
2021 and February 1, 2020
|
|
|
|
|
|
|
|
|
|
January
30,
|
|
February
1,
|
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash
|
|
$
|
9,166
|
$
|
949
|
Accounts
receivable
|
|
7,165
|
|
7,158
|
Inventories
|
|
42,401
|
|
40,152
|
Prepaid
expenses
|
|
|
3,137
|
|
5,418
|
Total current
assets
|
|
61,869
|
|
53,677
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
Loan
receivable
|
|
608
|
|
585
|
Lease
receivable
|
|
1,187
|
|
1,511
|
Fixed
assets
|
|
47,981
|
|
55,694
|
Right-of-use
assets
|
|
79,995
|
|
128,322
|
Intangible
assets
|
|
190,777
|
|
193,079
|
Goodwill
|
|
7,906
|
|
7,906
|
Total non-current
assets
|
|
328,454
|
|
387,097
|
Total
assets
|
|
$
|
390,323
|
$
|
440,774
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Bank
indebtedness
|
$
|
–
|
$
|
7,226
|
Accounts payable and
accrued liabilities
|
|
25,850
|
|
20,252
|
Deferred
revenue
|
|
5,759
|
|
6,011
|
Income taxes
payable
|
|
5,955
|
|
2,008
|
Current portion of
lease liabilities
|
|
22,197
|
|
26,569
|
Current portion of
long-term debt
|
|
4,984
|
|
4,984
|
Derivative
obligations
|
|
418
|
|
158
|
Total current
liabilities
|
|
65,163
|
|
67,208
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
Deferred tax
liabilities
|
|
15,891
|
|
13,942
|
Long-term portion of
lease liabilities
|
|
78,989
|
|
124,590
|
Long-term
debt
|
|
66,100
|
|
84,528
|
Total non-current
liabilities
|
|
160,980
|
|
223,060
|
Total
liabilities
|
|
226,143
|
|
290,268
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
Share
capital
|
|
197,333
|
|
196,903
|
Contributed
surplus
|
|
3,682
|
|
3,407
|
Accumulated other
comprehensive income (loss)
|
|
(227)
|
|
(116)
|
Retained earnings
(deficit)
|
|
(36,608)
|
|
(49,688)
|
Total shareholders'
equity
|
|
164,180
|
|
150,506
|
Total liabilities and
shareholders' equity
|
$
|
390,323
|
$
|
440,774
|
On behalf of the Board of Directors:
"Erol Uzumeri" Director
"Richard P. Mavrinac" Director
ROOTS
CORPORATION
Consolidated Statement of Net Income (Loss)
(In thousands of Canadian dollars, except per share
amounts)
|
|
|
|
|
|
|
|
|
|
|
|
For the 52-week
periods ended January 30, 2021 and February 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January
30,
|
|
February
1,
|
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
Sales
|
|
$
|
240,506
|
$
|
329,865
|
|
|
|
|
|
|
Cost of goods
sold
|
|
100,767
|
|
153,676
|
|
|
|
|
|
|
Gross
profit
|
|
139,739
|
|
176,189
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
114,807
|
|
188,308
|
|
|
|
|
|
|
Goodwill
impairment
|
|
–
|
|
44,799
|
|
|
|
|
|
|
Gain from
deconsolidation of RTS USA Corp.
|
|
4,774
|
|
–
|
|
|
|
|
|
|
Income (loss) before
interest expense and
|
|
|
|
|
income taxes expense
(recovery)
|
|
29,706
|
|
(56,918)
|
|
|
|
|
|
|
Interest
expense
|
|
11,741
|
|
15,567
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
|
17,965
|
|
(72,485)
|
|
|
|
|
|
|
Income taxes expense
(recovery)
|
|
4,885
|
|
(10,456)
|
|
|
|
|
|
Net income
(loss)
|
$
|
13,080
|
$
|
(62,029)
|
|
|
|
|
|
|
Basic earnings (loss)
per share
|
$
|
0.31
|
$
|
(1.47)
|
Diluted earnings
(loss) per share
|
$
|
0.31
|
$
|
(1.47)
|
|
|
|
|
|
ROOTS
CORPORATION Consolidated Statement of Comprehensive Income
(Loss)
(In thousands of Canadian dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the 52-week
periods ended January 30, 2021 and February 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January
30,
|
February
1,
|
|
|
|
|
2021
|
2020
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
|
$
|
13080
|
$
|
(62029)
|
|
|
|
|
|
|
|
|
Other comprehensive
income, net of taxes:
|
|
|
|
|
Items that may be
subsequently reclassified to profit or loss:
|
|
|
|
|
Effective portion of
changes in fair
|
|
|
|
|
value of cash flow
hedges
|
|
|
362
|
|
425
|
|
|
|
|
|
|
|
|
Cost of hedging
excluded from
|
|
|
|
|
|
cash flow
hedges
|
|
|
(22)
|
|
362
|
|
|
|
|
|
|
|
|
Tax impact of cash
flow hedges
|
|
|
(91)
|
|
(210)
|
Total other
comprehensive income
|
|
|
249
|
|
577
|
|
|
|
|
|
|
|
|
Total comprehensive
income (loss)
|
|
$
|
13,329
|
$
|
(61,452)
|
ROOTS
CORPORATION
Consolidated Statement of Changes in Shareholders' Equity
(In thousands of Canadian dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the 52-week
periods ended January 30, 2021 and February 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
Retained
|
|
other
|
|
|
|
|
|
Share
|
|
Contributed
|
|
earnings
|
|
comprehensive
|
|
|
January 30,
2021
|
|
capital
|
|
surplus
|
|
(deficit)
|
|
income
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, February 1,
2020
|
$
|
196,903
|
$
|
3,407
|
$
|
(49,688)
|
$
|
(116)
|
$
|
150,506
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
–
|
|
–
|
|
13,080
|
|
–
|
|
13,080
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain from change
in fair
|
|
|
|
|
|
|
|
|
|
|
value of cash flow
hedges,
|
|
|
|
|
|
|
|
|
|
|
net of income
taxes
|
|
–
|
|
–
|
|
–
|
|
249
|
|
249
|
|
|
|
|
|
|
|
|
|
|
|
|
Transfer of realized
loss on cash
|
|
|
|
|
|
|
|
|
|
flow hedges to
inventories, net
|
|
|
|
|
|
|
|
|
|
of income
taxes
|
|
–
|
|
–
|
|
–
|
|
(360
|
|
(360)
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
–
|
|
705
|
|
–
|
|
–
|
|
705
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of
shares
|
|
430
|
|
(430)
|
|
–
|
|
–
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, January 30,
2021
|
$
|
197,333
|
$
|
3,682
|
$
|
(36,608)
|
$
|
(227)
|
$
|
164,180
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
Retained
|
|
other
|
|
|
|
|
|
Share
|
|
Contributed
|
|
earnings
|
|
comprehensive
|
|
|
February 1,
2020
|
|
capital
|
|
surplus
|
|
(deficit)
|
|
income
(loss)
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, February 2,
2019
|
$
|
196,853
|
$
|
3,975
|
$
|
13,608
|
$
|
268
|
$
|
214,704
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustment on
adoption of IFRS 16
|
|
|
–
|
|
–
|
|
(1,267)
|
|
–
|
|
(1,267)
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, February 3,
2019
|
$
|
196,853
|
$
|
3,975
|
$
|
12,341
|
$
|
268
|
$
|
213,437
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
–
|
|
–
|
|
(62,029)
|
|
–
|
|
(62,029)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain from change
in fair
|
|
|
|
|
|
|
|
|
|
|
value of cash flow
hedges,
|
|
|
|
|
|
|
|
|
|
|
net of income
taxes
|
|
–
|
|
–
|
|
–
|
|
577
|
|
577
|
|
|
|
|
|
|
|
|
|
|
|
|
Transfer of realized
loss on cash
|
|
|
|
|
|
|
|
|
|
flow hedges to
inventories, net
|
|
|
|
|
|
|
|
|
|
of income
taxes
|
|
–
|
|
–
|
|
–
|
|
(961)
|
|
(961)
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
–
|
|
(518)
|
|
–
|
|
–
|
|
(518)
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of
shares
|
|
50
|
|
(50)
|
|
–
|
|
–
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, February 1,
2020
|
$
|
196,903
|
$
|
3,407
|
$
|
(49,688)
|
$
|
(116)
|
$
|
150,506
|
ROOTS
CORPORATION
Consolidated Statement of Cash Flows
(In thousands of Canadian dollars)
|
|
|
|
|
|
|
|
|
|
|
|
For the 52-week
periods ended January 30, 2021 and February 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January
30,
|
|
February
1,
|
|
|
|
2021
|
|
2020
|
|
|
|
|
|
|
Cash provided by
(used in):
|
|
|
|
|
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
13,080
|
$
|
(62,029)
|
Items not involving
cash:
|
|
|
|
Depreciation and
amortization
|
|
33,325
|
|
39,606
|
Share-based
compensation expense (recovery)
|
|
705
|
|
(518)
|
Impairment of fixed
assets and right-of-use assets
|
|
2,048
|
|
22,398
|
Impairment of
goodwill
|
|
–
|
|
44,799
|
Gain from
deconsolidation of RTS USA Corp
|
|
(4,774)
|
|
–
|
Unrealized losses on
forward contracts
|
|
105
|
|
–
|
Gain on lease
modification
|
|
(310)
|
|
(520)
|
Rent concessions
related to practical expedient
|
|
(3,525)
|
|
–
|
Interest
expense
|
|
11,741
|
|
15,567
|
Income taxes expense
(recovery)
|
|
4,885
|
|
(10,456)
|
Interest
paid
|
|
|
(4,337)
|
|
(5,904)
|
Payment of interest
on lease liabilities
|
|
(6,724)
|
|
(9,048)
|
Taxes refunded
(paid)
|
|
1,056
|
|
(2,200)
|
Change in non-cash
operating working capital:
|
|
|
|
|
Accounts
receivable
|
|
(7)
|
|
(531)
|
Inventories
|
|
|
(4,540)
|
|
9,381
|
Prepaid
expenses
|
|
2,281
|
|
1,025
|
Accounts payable and
accrued liabilities
|
|
6,165
|
|
(2,039)
|
Deferred
revenue
|
|
(252)
|
|
513
|
|
|
|
50,922
|
|
40,044
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
Issuance (repayment)
of long-term debt
|
|
(14,000)
|
|
9,000
|
Long-term debt
financing costs
|
|
(148)
|
|
(163)
|
Repayment of Term
Credit Facility
|
|
(4,984)
|
|
(4,984)
|
Payment of principal
on lease liabilities, net of tenant allowance
|
(12,383)
|
|
(17,436)
|
|
|
|
(31,515)
|
|
(13,583)
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
Additions to fixed
assets
|
|
(3,423)
|
|
(22,320)
|
Deconsolidation of
RTS USA Corp
|
|
(541)
|
|
–
|
|
|
|
(3,964)
|
|
(22,320)
|
|
|
|
|
|
|
Increase in
cash
|
|
|
15,443
|
|
4,141
|
|
|
|
|
|
|
Cash and bank
indebtedness, beginning of period
|
|
(6,277)
|
|
(10,418)
|
|
|
|
|
|
|
Cash and bank
indebtedness, end of period
|
$
|
9,166
|
$
|
(6,277)
|
SOURCE Roots Corporation