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Colabor Group Reports Results for the Second Quarter of 2019
Mon July 29, 2019 6:00 AM|GlobeNewswire
BOUCHERVILLE, Quebec, July 29, 2019 (GLOBE NEWSWIRE) -- Colabor Group Inc. (COLFF) (TSX: GCL) (“Colabor” or the “Corporation”) reports its results for the second quarter ended June 15, 2019.
Second Quarter 2019 Highlights:
Sales were up 0.2% to $274.2 million compared to the corresponding period of 2018
Net earnings from continuing operations for the quarter was $1.4 million compared to $0.5 million for the corresponding period of 2018
Adjusted EBITDA1 in the quarter reached $7.3 million, representing an increase of 37.2%
Total debt reduced to $97.7 million from $122.4 million last year
Table of Financial Highlights:
Financial highlights 84-day periods 168-day periods
(unaudited, thousands of dollars except per share data) June 15, 2019 June 16, 2018 June 15, 2019 June 16, 2018
$ $ $ $
Sales 274,198 273,564 486,979 496,168
Adjusted EBITDA1 7,304 5,323 7,359 3,833
Net earnings from continued operations 1,378 498 (1,558 ) (3,851 )
Net earnings (loss) 9,039 817 6,305 (3,663 )
Per share - basic and diluted ($) 0.09 0.01 0.06 (0.04 )
Cash flow from operating activities (4,999 ) (4,225 ) (5,412 ) (4,920 )
Net debt1 97,736 122,389 97,736 122,389
1 Non-IFRS measures. Refer to the table of reconciliation of Net Earnings to EBITDA in section 6 "Non-IFRS Performance Measures" in the Management Discussion and Analysis. Adjusted EBITDA is equivalent to the Operating earnings before costs not related to current operations, depreciation and amortization as show in the Company's financial statements.
"Over the past twelve months, the initiatives implemented by the new management team have contributed to stabilize our consolidated sales, for the second quarter. Improvement in our customer mix, tight cost control from the 2018 rationalization plan and optimization measures supported the growth in our operating results in the second quarter of 2019," said Lionel Ettedgui, President and Chief Executive Officer of Colabor. "In addition, the recent sale of our Viandes Décarie division has allowed us to reduce our debt level and gives us the flexibility to focus to a greater degree on our growth areas."
Results for the Second Quarter of 2019
Consolidated sales for the second quarter reached $274.2 million compared to $273.6 million during the corresponding quarter of last fiscal year, representing an increase of 0.2%. Sales in the Distribution segment increased by 1.1% mainly due to a retailer-led promotion, mitigated by changes in the customer mix for certain regions. Sales in the Wholesale segment decreased by 6.0%, mainly due to the non-renewal of non-profitable contracts.
Adjusted EBITDA for the second quarter of 2019 reached $7.3 million, an increase of $2.0 million compared to the corresponding period of 2018. This improvement is explained by the deployment of operational optimization measures, improved cost control resulting from the implementation of the rationalization plan announced last November and sales growth from the Distribution segment.
Net earnings from continuing operations was $1.4 million, up 176.7% compared to the corresponding quarter of 2018. This increase is due to lower operating expenses and higher sales, which were partially offset by higher taxes.
Net earnings for the second quarter was $9.0 million or $0.09 per share, compared to $0.8 million or $0.01 per share during the corresponding period of 2018. The $7.7 million gain on disposal of the Viandes Décarie division contributed to this growth, as did the increase in net earnings from continuing operations.
Results for the First Six Months of 2019
Cumulative consolidated sales were $487.0 million compared to $496.2 million during the corresponding period of the last fiscal year, a decrease of 1.9% mainly from the Distribution segment. Cumulative adjusted EBITDA reached $7.4 million, an increase of 92.0%. Net earnings for the 168-day period reached $6.3 million, or $0.06 per share, up $10.0 million compared to the corresponding period last fiscal year.
Cash Flow and Financial Position
Cash flow from operating activities amounted to a deficit of $5.0 million, up from a deficit of $4.2 million for the corresponding period of 2018. This increase is explained by working capital requirements which were mitigated by a growing Adjusted EBITDA.
As at June 15, 2019, the Company's total debt, including convertible debentures and bank indebtedness, amounted to $97.7 million, down $24.7 million from last fiscal year. This reduction is mainly due to the proceeds from the sale of the Viandes Décarie division, which were applied to the repayment of a portion of the credit facility and subordinated debt, as well as to finance cash flow from operating activities.
Outlook
"For fiscal 2019, we are pursuing the transformation of Colabor and growth in our most promising markets. Our plan remains focused on three pillars: the expansion of our broadline activities in Quebec, the integration and optimization of our business units and debt reduction. Recent changes in the customer mix, reduced operating expenses and the sale of Viandes Décarie are the steps of this plan to transform our business," concluded Mr. Ettedgui.
Conference Call
Colabor will hold a conference call to discuss these results, today Monday July 29, 2019, beginning at 9:00 a.m. Eastern time. Interested parties can join the call by dialing 1-877-223-4471 (from anywhere in North America) or (647) 788-4922. If you are unable to participate, you can listen to a recording by dialing 1-800-585-8367 or 416-621-4642 and entering the code 3092227 on your telephone keypad. The recording will be available from 12:00 p.m. on Monday, July 29, 2019, to 11:59 p.m. on Monday August 12, 2019.
Those wishing to join the webcast and presentation can do so by clicking on the following link:
http://www.colabor.com/en/investisseurs/evenements-et-presentations/
Non-IFRS Measures
The information provided in this release includes non-IFRS performance measures,
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