Bauer Performance Sports Provides Preliminary Fiscal Third Quarter 2014 Results
March 19 2014 - 9:17PM
Marketwired Canada
Bauer Performance Sports Ltd. (TSX:BAU) ("BPS" or the "Company"), a leading
developer and manufacturer of high performance sports equipment and apparel,
provided preliminary results for its fiscal third quarter ended February 28,
2014.
BPS is issuing this news release pursuant to its obligations under applicable
Canadian securities laws to enable it to disclose this information in meetings
in connection with its fully committed debt financing related to the Company's
previously announced pending acquisition of Easton Baseball/Softball. BPS does
not intend to continue to provide preliminary results for future periods in
respect of revenue, Adjusted Gross Profit, Adjusted EBITDA, Adjusted EPS,
capital expenditures, cash, outstanding debt balances or other key performance
measures.
All figures are in millions of U.S. dollars, except Adjusted EPS.
Estimated for the For the three
three months ended months ended
February 28, February 28,
2014 2013
-------------------------------------
Income Statement
Revenue $ 61.0 - 63.0 $ 54.9
Adjusted Gross Profit(i) $ 19.0 - 21.0 $ 16.4
Adjusted EBITDA(i) $ (3.5) - (2.5) $ (3.8)
Adjusted EPS(i) $ (0.12) - (0.10) $ (0.11)
Cash Flow
Capital Expenditures $ 0.7 - 0.9 $ 2.3
Estimated as of As of
February 28, February 28,
2014 2013
-------------------------------------
Balance Sheet
Cash $ 7.7 $ 8.6
Revolver 36.0 34.0
Term Loan A 97.2 110.6
Capital Leases 0.3 0.1
-------------------------------------
Total Debt $ 133.5 $ 144.6
(i) Note: Adjusted Gross Profit, Adjusted EBITDA, and Adjusted EPS are non-IFRS
measures. Please see "Non-IFRS Measures" at the end of this news release.
In the third quarter of fiscal year 2014, BPS's revenues increased due to growth
in the sale of ice hockey equipment, lacrosse and apparel, and the addition of
revenues from the Combat business.
Adjusted Gross Profit improved as a result of the increase in revenues and
higher profit margins in ice hockey equipment.
Adjusted EBITDA increased due to the higher Adjusted Gross Profit and favorable
realized gains/losses on derivatives, partially offset by higher research and
development and selling, general, and administrative expenses due to the
addition of Combat Sports, as well as higher endorsement expenses driven by the
impact of the NHL lockout in the prior year period.
Capital expenditures decreased due to lower information systems investment
compared to the prior year when the Company was integrating its information
systems with those of Cascade Helmets.
BPS's total net debt (debt less cash on hand) as of February 28, 2014 is
estimated to be $125.8 million, a decrease of $10.2 million from the prior year
period. The decrease is due primarily to term loan repayments of $9.4 million
and the impact of favorable foreign exchange of $4.0 million on the Company's
term loan balance. The revolving loan balance increased $2.0 million versus the
prior year period due to $8.8 million paid for acquisition-related expenses,
share offerings and other charges, the acquisition of Combat for $3.3 million,
and increased working capital requirements to support the Company's growth of
approximately $21.0 million.
All figures reported above with respect to the third quarter of fiscal 2014 are
preliminary and are subject to change as BPS's third quarter of fiscal 2014
financial results are finalized. These preliminary results have not been
reviewed by BPS's auditors. The preliminary estimates provided in this news
release constitute forward-looking statements within the meaning of applicable
securities laws, are based on a number of assumptions and are subject to a
number of risks and uncertainties. Please see section below entitled "Caution
Regarding Forward-Looking Statements."
BPS intends to issue a press release with respect to the finalized financial
results of the third quarter of fiscal 2014 during the week of April 7, 2014.
This press release will contain further detail on the results from BPS's third
quarter of fiscal 2014, including disclosure regarding the booking orders for
the 2014 Back-to-Hockey season compared to the 2013 Back-to-Hockey season. At
such time, the Company will also file its unaudited condensed consolidated
interim financial statements as of February 28, 2014 and for the three and nine
months ended February 28, 2014 and 2013, together with the notes thereto and
management's discussion and analysis of financial condition and results of
operations of the Company for the three and nine month periods ended February
28, 2014 (the "Q3 MD&A").
About Bauer Performance Sports Ltd.
Bauer Performance Sports Ltd. (TSX:BAU) is a leading developer and manufacturer
of ice hockey, roller hockey, lacrosse, baseball and softball equipment, as well
as related apparel. The Company has the most recognized and strongest brand in
the ice hockey equipment industry, and holds the top market share position in
both ice and roller hockey. Its products are marketed under the BAUER, MISSION,
MAVERIK, CASCADE, INARIA and COMBAT brand names and are distributed by sales
representatives and independent distributors throughout the world. Bauer
Performance Sports is focused on building its leadership position and growing
market share in all product categories through continued innovation at every
level. For more information, please visit www.bauerperformancesports.com.
Non-IFRS Measures
Adjusted Gross Profit, Adjusted EBITDA and Adjusted EPS are non-IFRS measures.
Adjusted Gross Profit is defined as gross profit plus the following expenses
which are part of cost of goods sold: (i) amortization and depreciation of
intangible assets, (ii) non-cash charges to cost of goods sold resulting from
fair market value adjustments to inventory as a result of business acquisitions,
(iii) reserves established to dispose of obsolete inventory acquired from
acquisitions and (iv) other one-time or non-cash items. Adjusted EBITDA is
defined as EBITDA (net income adjusted for income tax expense, depreciation and
amortization, losses related to amendments to the credit facility, gain or loss
on disposal of fixed assets, net interest expense, deferred financing fees,
unrealized gains/losses on derivative instruments, and realized and unrealized
gains/losses related to foreign exchange revaluation) before restructuring and
other one-time or non-cash charges associated with acquisitions, other one-time
or non-cash items, pre-initial public offering sponsor fees, costs related to
share offerings, as well as share-based payment expenses. Adjusted EPS is
defined as Adjusted Net Income/Loss divided by the weighted average diluted
shares outstanding. Adjusted Net Income/Loss is defined as net income adjusted
for all unrealized gains/losses related to derivative instruments and unrealized
gains/losses related to foreign exchange revaluation, non-cash or incremental
charges associated with acquisitions, amortization of acquisition-related
intangible assets for acquisitions since the Company's initial public offering,
costs related to share offerings, share-based compensation expense and other
non-cash or one-time items. Reconciliations of these non-IFRS measures to the
relevant reported results, when finalized, can be found in the Company's Q3 MD&A
(defined above).
Caution Regarding Forward-Looking Statements
This press release includes forward-looking statements within the meaning of
applicable securities laws, including with respect to our preliminary results
for the third quarter of fiscal 2014, the Company's pending acquisition of
Easton Baseball/Softball and the financing thereof. Forward-looking statements
relate to analyses and other information that are based on forecasts of future
results and estimates of amounts not yet determinable. The words "may", "will",
"would", "should", "could", "expects", "plans", "intends", "trends",
"indications", "anticipates", "believes", "estimates", "predicts", "likely" or
"potential" or the negative or other variations of these words or other
comparable words or phrases, are intended to identify forward-looking
statements.
Forward-looking statements, by their nature, are based on assumptions, including
those described herein and are subject to important risks and uncertainties.
Many factors could cause the Company's actual results to differ materially from
those expressed or implied by the forward-looking statements, including, without
limitation, the following factors: inability to introduce new and innovative
products, intense competition in the equipment and apparel industries, inability
to introduce technical innovation, inability to protect worldwide intellectual
property rights and related litigation, inability to successfully integrate
acquisitions, decrease in ice hockey, roller hockey, lacrosse and/or
baseball/softball participation rates, adverse publicity, reduction in
popularity of the NHL, NLL, MLB and other professional leagues in which our
products are used, changes in consumer preferences and the difficulty in
anticipating or forecasting those changes, inability to maintain and enhance
brands, reliance on third party suppliers and manufacturers, disruption of
distribution chain or loss of significant customers or suppliers, cost of raw
materials and shipping freight and other cost pressures, a change in the mix or
timing of orders placed by customers, inability to forecast demand for products,
inventory shrinkage or excess inventory, product liability claims and lawsuits,
product recalls, compliance with standards of testing and athletic governing
bodies, departure of senior executives or other key personnel, litigation and
related matters, employment or union related matters, fluctuations in the value
of certain foreign currencies in relation to the US dollar, inability to manage
foreign exchange derivative instruments, general economic and market conditions,
natural disasters, as well as the factors identified in the "Risk Factors"
section of Bauer's Annual Information Form dated August 27, 2013 available on
SEDAR at www.sedar.com.
Furthermore, unless otherwise stated, the forward-looking statements contained
in this press release are made as of the date of this press release, and 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 law.
FOR FURTHER INFORMATION PLEASE CONTACT:
Company Contact: Bauer Performance Sports Ltd.
Amir Rosenthal
Chief Financial Officer
1-603-610-5802
investors@bauerperformancesports.com
Investor Relations: Liolios Group Inc.
Scott Liolios or Cody Slach
1-949-574-3860
BAU@liolios.com
Media Contact: Bauer Performance Sports Ltd.
Tory Mazzola
Global Communications Manager
1-603-430-2111
media@bauerperformancesports.com
www.bauerperformancesports.com
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