<< [Back to News Releases]
Aug 30, 2011
5:26pm
MONTREAL, Aug. 30, 2011 /CNW Telbec/ - Sales for the six months ended
July 30, 2011 decreased 4.2% to $505,371,000 as compared with
$527,771,000 for the six months ended July 31, 2010. Same store sales1 decreased 4.8%. Despite the first quarter yielding disappointing sales
results due to poor weather, more seasonable weather conditions
contributed to improved sales in the second quarter of fiscal 2012 over
the first quarter of fiscal 2012. The Company's gross margin decreased
from 68.4% to 65.7% for the six months ended July 30, 2011. An
improvement in the gross margin attributable to the strength of the
Canadian dollar in the six months ended July 30, 2011 was offset by
increased promotional activity. The average rate for a US dollar in
the first six months of fiscal 2012 was $0.97 Canadian as compared to
$1.03 Canadian in the first six months of fiscal 2011. EBITDA1 decreased 30.9% to $72,922,000 as compared with $105,564,000 last
year. Net earnings decreased 40.7% to $32,304,000 or $0.48 diluted
earnings per share as compared with $54,476,000 or $0.80 diluted
earnings per share last year.
Sales for the second quarter ended July 30, 2011 decreased 2.0% to
$286,075,000 as compared with $292,026,000 for the second quarter ended
July 31, 2010. Same store sales decreased by 1.8%. EBITDA for the
period decreased by $10,925,000 or 15.7% to $58,553,000 as compared
with $69,478,000 last year. The Company's gross margin decreased from
68.9% to 65.6% for the three months ended July 30, 2011. An improvement
in the gross margin attributable to the strength of the Canadian dollar
in the three months ended July 30, 2011 was offset by increased
promotional activity. The average rate for a US dollar in the second
quarter ended July 30, 2011 was $0.97 Canadian as compared to $1.04
Canadian in the second quarter ended July 31, 2010. Net earnings
decreased 18.2% to $31,680,000 or $0.48 diluted earnings per share as
compared to $38,706,000 or $0.57 diluted earnings per share for the
same period last year.
During the second quarter, the Company opened seven new stores,
comprised of 1 Reitmans, 3 Thyme Maternity, 1 Cassis and 2
Penningtons. Seven stores were closed, comprised of 1 Reitmans, 2
Thyme Maternity, 3 Penningtons and 1 Addition Elle. At July 30, 2011,
there were 965 stores in operation, consisting of 363 Reitmans, 157
Smart Set, 67 RW & CO., 74 Thyme Maternity, 24 Cassis, 159 Penningtons
and 121 Addition Elle, as compared with a total of 977 stores as at
July 31, 2010.
Sales for the month of August (the four weeks ended August 27, 2011)
decreased 3.2% with same store sales decreasing 3.7%.
At the Board of Directors meeting held on August 30, 2011, a quarterly
cash dividend (constituting eligible dividends) of $0.20 per share on
all outstanding Class A non-voting and Common shares of the Company was
declared, payable October 27, 2011 to shareholders of record on October
13, 2011.
Effective for the first quarter ended April 30, 2011, Reitmans began
reporting its financial results in accordance with International
Financial Reporting Standards ("IFRS"), including comparative
information. Previously reported financial results prepared in
accordance with Canadian generally accepted accounting principles have
been presented to conform to the new standards adopted.
1Non-GAAP Financial Measures
In addition to discussing earnings in accordance with IFRS, this press
release provides EBITDA as a supplementary earnings measure, which is
defined as earnings before income taxes, dividend income, interest
income, interest expense and depreciation, amortization and impairment
losses related to property and equipment. The Company also discloses
same store sales, which are defined as sales generated by stores that
have been open for at least one year. The Company believes these
measures provide meaningful information on the Company's performance
and operating results. However, readers should know that these non-GAAP
financial measures have no standardized meaning as prescribed by IFRS
and may not be comparable to similar measures presented by other
companies. Accordingly, they should not be considered in isolation.
Forward-Looking Statements
All of the statements contained herein, other than statements of fact
that are independently verifiable at the date hereof, are
forward-looking statements. Such statements, based as they are on the
current expectations of management, inherently involve numerous risks
and uncertainties, known and unknown, many of which are beyond the
Company's control. Such risks include but are not limited to: the
impact of general economic conditions, general conditions in the retail
industry, seasonality, weather and other risks included in public
filings of the Company. Consequently, actual future results may differ
materially from the anticipated results expressed in forward-looking
statements. The reader should not place undue reliance on the
forward-looking statements included herein. These statements speak only
as of the date made and the Company is under no obligation and disavows
any intention to update or revise such statements as a result of any
event, circumstances or otherwise, except to the extent required under
applicable securities law.
The Company's unaudited interim condensed financial statements including
notes and Management's Discussion and Analysis for the second quarter
ended July 30, 2011 are available online at www.sedar.com.
|
Montreal, August 30, 2011
|
|
|
Jeremy H. Reitman
Chairman and Chief Executive Officer
|
|
|
|
Telephone:
|
(514) 385-2630
|
|
Corporate Website:
|
www.reitmans.ca
|
REITMANS (CANADA) LIMITED
CONDENSED STATEMENTS OF EARNINGS (Unaudited)
(in thousands of Canadian dollars except per share amounts)
|
|
|
|
|
|
For the six months ended
|
For the three months ended
|
|
|
July 30, 2011
|
July 31, 2010
|
July 30, 2011
|
July 31, 2010
|
|
|
|
Sales
|
$
|
505,371
|
|
$
|
527,771
|
$
|
286,075
|
$
|
292,026
|
|
Cost of goods sold
|
|
173,392
|
|
|
166,743
|
|
98,451
|
|
90,771
|
|
Gross profit
|
|
331,979
|
|
|
361,028
|
|
187,624
|
|
201,255
|
|
Selling and distribution expenses
|
|
264,822
|
|
|
258,317
|
|
135,597
|
|
131,835
|
|
Administrative expenses
|
|
21,171
|
|
|
26,275
|
|
11,059
|
|
15,809
|
|
Results from operating activities
|
|
45,986
|
|
|
76,436
|
|
40,968
|
|
53,611
|
|
|
|
Finance income
|
|
2,360
|
|
|
1,644
|
|
3,052
|
|
1,898
|
|
Finance costs
|
|
3,630
|
|
|
522
|
|
173
|
|
195
|
|
Earnings before income taxes1
|
|
44,716
|
|
|
77,558
|
|
43,847
|
|
55,314
|
|
|
|
Income taxes
|
|
12,412
|
|
|
23,082
|
|
12,167
|
|
16,608
|
|
|
|
Net earnings
|
$
|
32,304
|
|
$
|
54,476
|
$
|
31,680
|
$
|
38,706
|
|
|
|
Earnings per share:
|
|
|
Basic
|
$
|
0.49
|
|
$
|
0.81
|
$
|
0.48
|
$
|
0.58
|
|
|
Diluted
|
|
0.48
|
|
|
0.80
|
|
0.48
|
|
0.57
|
|
|
|
|
|
1 A reconciliation of earnings before income taxes to earnings before
income taxes, dividend income, interest income, interest expense and
depreciation, amortization and impairment losses ("EBITDA") is as
follows:
|
|
Earnings before income taxes
|
$
|
44,716
|
|
$
|
77,558
|
$
|
43,847
|
$
|
55,314
|
|
Dividend income
|
|
1,748
|
|
|
1,286
|
|
868
|
|
615
|
Interest income
|
|
612
|
|
|
358
|
|
328
|
|
219
|
|
Interest expense
|
|
352
|
|
|
394
|
|
173
|
|
195
|
|
Depreciation, amortization and impairment losses
|
|
30,214
|
|
|
29,256
|
|
15,729
|
|
14,803
|
|
|
|
|
|
|
|
EBITDA
|
$
|
72,922
|
|
$
|
105,564
|
$
|
58,553
|
$
|
69,478
|
|
|
|
|
|
|
|
|
|
|
|
REITMANS (CANADA) LIMITED
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
(in thousands of Canadian dollars)
|
|
|
|
|
|
For the six months ended
|
For the three months ended
|
|
|
July 30, 2011
|
July 31, 2010
|
July 30, 2011
|
July 31, 2010
|
|
|
|
|
|
|
|
Net earnings
|
$
|
32,304
|
|
$
|
54,476
|
$
|
31,680
|
$
|
38,706
|
|
Other comprehensive income:
|
|
|
Net unrealized gain on available-for-sale financial assets arising
during the period (net of tax of $125 for the six months and $65
for the three months ended July 30, 2011; $144 for the six months
and $55 for the three months ended July 31, 2010)
|
|
839
|
|
|
969
|
|
438
|
|
371
|
|
|
|
Total comprehensive income
|
$
|
33,143
|
|
$
|
55,445
|
$
|
32,118
|
$
|
39,077
|
|
|
REITMANS (CANADA) LIMITED
CONDENSED BALANCE SHEETS (Unaudited)
(in thousands of Canadian dollars)
|
|
|
|
|
|
|
July 30, 2011
|
|
July 31, 2010
|
|
January 29, 2011
|
|
ASSETS
|
|
CURRENT ASSETS
|
|
|
Cash and cash equivalents
|
|
$
|
207,492
|
|
$
|
213,536
|
|
$
|
230,034
|
|
|
Marketable securities
|
|
|
71,587
|
|
|
49,316
|
|
|
70,413
|
|
|
Trade and other receivables
|
|
|
2,723
|
|
|
2,582
|
|
|
2,866
|
|
|
Income taxes recoverable
|
|
|
9,377
|
|
|
-
|
|
|
-
|
|
|
Inventories
|
|
|
81,477
|
|
|
68,429
|
|
|
73,201
|
|
|
Prepaid expenses
|
|
|
14,264
|
|
|
14,216
|
|
|
12,491
|
|
|
|
Total Current Assets
|
|
|
386,920
|
|
|
348,079
|
|
|
389,005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-CURRENT ASSETS
|
|
|
Property and equipment
|
|
|
184,905
|
|
|
202,750
|
|
|
193,064
|
|
|
Intangibles
|
|
|
14,705
|
|
|
9,939
|
|
|
13,841
|
|
|
Goodwill
|
|
|
42,426
|
|
|
42,426
|
|
|
42,426
|
|
|
Deferred income taxes
|
|
|
20,624
|
|
|
20,886
|
|
|
21,021
|
|
|
|
Total Non-Current Assets
|
|
|
262,660
|
|
|
276,001
|
|
|
270,352
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$
|
649,580
|
|
$
|
624,080
|
|
$
|
659,357
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
CURRENT LIABILITIES
|
|
|
Trade and other payables
|
|
$
|
58,111
|
|
$
|
52,055
|
|
$
|
64,093
|
|
|
Deferred revenue
|
|
|
14,364
|
|
|
14,535
|
|
|
19,834
|
|
|
Income taxes payable
|
|
|
-
|
|
|
1,147
|
|
|
5,998
|
|
|
Current portion of long-term debt
|
|
|
1,428
|
|
|
1,341
|
|
|
1,384
|
|
|
|
Total Current Liabilities
|
|
|
73,903
|
|
|
69,078
|
|
|
91,309
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-CURRENT LIABILITIES
|
|
|
Other payables
|
|
|
10,729
|
|
|
9,507
|
|
|
10,180
|
|
|
Deferred revenue
|
|
|
2,304
|
|
|
2,636
|
|
|
2,384
|
|
|
Deferred lease credits
|
|
|
17,515
|
|
|
19,279
|
|
|
19,011
|
|
|
Long-term debt
|
|
|
9,323
|
|
|
10,751
|
|
|
10,047
|
|
|
Pension liability
|
|
|
14,027
|
|
|
12,231
|
|
|
13,626
|
|
|
|
Total Non-Current Liabilities
|
|
|
53,898
|
|
|
54,404
|
|
|
55,248
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
Share capital
|
|
|
31,518
|
|
|
26,930
|
|
|
29,614
|
|
|
Contributed surplus
|
|
|
6,772
|
|
|
5,818
|
|
|
6,266
|
|
|
Retained earnings
|
|
|
475,284
|
|
|
461,526
|
|
|
469,554
|
|
|
Accumulated other comprehensive income
|
|
|
8,205
|
|
|
6,324
|
|
|
7,366
|
|
|
|
Total Shareholders' Equity
|
|
|
521,779
|
|
|
500,598
|
|
|
512,800
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
$
|
649,580
|
|
$
|
624,080
|
|
$
|
659,357
|
|
|
|
|
|
|
|
|
|
|
|
|
REITMANS (CANADA) LIMITED
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited)
(in thousands of Canadian dollars)
|
|
|
|
|
|
For the six months ended
|
|
|
July 30, 2011
|
July 31, 2010
|
|
|
|
SHARE CAPITAL
|
|
Balance, beginning of the period
|
$
|
29,614
|
|
$
|
25,888
|
|
|
Cash consideration on exercise of share options
|
|
1,516
|
|
|
1,424
|
|
|
Ascribed value credited to share capital from exercise
of share options
|
|
388
|
|
|
349
|
|
|
Cancellation of shares pursuant to share repurchase
program
|
|
-
|
|
|
(731)
|
|
Balance, end of the period
|
|
31,518
|
|
|
26,930
|
|
|
|
CONTRIBUTED SURPLUS
|
|
Balance, beginning of the period
|
|
6,266
|
|
|
5,164
|
|
|
Share-based compensation costs
|
|
894
|
|
|
1,003
|
|
|
Ascribed value credited to share capital from exercise
of share options
|
|
(388)
|
|
|
(349)
|
|
Balance, end of the period
|
|
6,772
|
|
|
5,818
|
|
|
|
|
|
|
|
|
RETAINED EARNINGS
|
|
|
|
|
|
|
Balance, beginning of the period
|
|
469,554
|
|
|
461,845
|
|
|
Net earnings
|
|
32,304
|
|
|
54,476
|
|
|
Dividends
|
|
(26,574)
|
|
|
(25,414)
|
|
|
Premium on repurchase of Class A non-voting shares
|
|
-
|
|
|
(29,381)
|
|
Balance, end of the period
|
|
475,284
|
|
|
461,526
|
|
|
|
|
|
|
|
|
ACCUMULATED OTHER COMPREHENSIVE INCOME
|
|
Balance, beginning of the period
|
|
7,366
|
|
|
5,355
|
|
|
Net unrealized gain on available-for-sale financial assets arising
during the period (net of tax of $125; $144 for the six months ended
July 31, 2010)
|
|
839
|
|
|
969
|
|
Balance, end of the period
|
|
8,205
|
|
|
6,324
|
|
|
|
|
|
|
|
|
Total Shareholders' Equity
|
$
|
521,779
|
|
$
|
500,598
|
REITMANS (CANADA) LIMITED
CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
(in thousands of Canadian dollars)
|
|
|
|
|
|
For the six months ended
|
|
For the three months ended
|
|
|
July 30, 2011
|
July 31, 2010
|
|
July 30, 2011
|
July 31, 2010
|
|
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES
|
|
|
|
|
|
|
Net earnings
|
$
|
32,304
|
|
$
|
54,476
|
|
|
$
|
31,680
|
|
$
|
38,706
|
|
|
Adjustments for:
|
|
|
|
|
|
|
|
Depreciation, amortization and impairment losses
|
|
30,214
|
|
|
29,256
|
|
|
|
15,729
|
|
|
14,803
|
|
|
|
Share-based compensation costs
|
|
894
|
|
|
1,003
|
|
|
|
500
|
|
|
549
|
|
|
|
Amortization of deferred lease credits
|
|
(2,320)
|
|
|
(2,495)
|
|
|
|
(1,106)
|
|
|
(1,226)
|
|
|
|
Deferred lease credits
|
|
824
|
|
|
1,164
|
|
|
|
509
|
|
|
259
|
|
|
|
Pension contribution
|
|
(357)
|
|
|
(310)
|
|
|
|
(228)
|
|
|
(155)
|
|
|
|
Pension expense
|
|
758
|
|
|
676
|
|
|
|
379
|
|
|
338
|
|
|
|
Foreign exchange loss (gain)
|
|
2,451
|
|
|
160
|
|
|
|
(480)
|
|
|
(330)
|
|
|
|
Interest and dividend income, net
|
|
(2,008)
|
|
|
(1,250)
|
|
|
|
(1,023)
|
|
|
(639)
|
|
|
|
Interest paid
|
|
(352)
|
|
|
(394)
|
|
|
|
(173)
|
|
|
(195)
|
|
|
|
Interest received
|
|
633
|
|
|
426
|
|
|
|
311
|
|
|
340
|
|
|
|
Dividends received
|
|
1,726
|
|
|
1,166
|
|
|
|
864
|
|
|
369
|
|
|
|
Income taxes
|
|
12,412
|
|
|
23,082
|
|
|
|
12,167
|
|
|
16,608
|
|
|
|
77,179
|
|
|
106,960
|
|
|
|
59,129
|
|
|
69,427
|
|
|
Changes in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and other receivables
|
|
144
|
|
|
396
|
|
|
|
1,512
|
|
|
1,308
|
|
|
|
Inventories
|
|
(8,276)
|
|
|
(5,302)
|
|
|
|
17,589
|
|
|
13,429
|
|
|
|
Prepaid expenses
|
|
(1,773)
|
|
|
(3,206)
|
|
|
|
(1,549)
|
|
|
(2,585)
|
|
|
|
Trade and other payables
|
|
(3,734)
|
|
|
(1,904)
|
|
|
|
(9,877)
|
|
|
(15,167)
|
|
|
|
Deferred revenue
|
|
(5,550)
|
|
|
(3,637)
|
|
|
|
403
|
|
|
570
|
|
|
Cash generated from operating activities
|
|
57,990
|
|
|
93,307
|
|
|
|
67,207
|
|
|
66,982
|
|
|
Income taxes received
|
|
-
|
|
|
14
|
|
|
|
-
|
|
|
14
|
|
|
Income taxes paid
|
|
(27,514)
|
|
|
(29,341)
|
|
|
|
(11,948)
|
|
|
(8,429)
|
|
|
Net cash flows from operating activities
|
|
30,476
|
|
|
63,980
|
|
|
|
55,259
|
|
|
58,567
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS USED IN INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of marketable securities
|
|
(210)
|
|
|
(177)
|
|
|
|
(105)
|
|
|
(107)
|
|
|
Additions to property and equipment and intangibles
|
|
(24,619)
|
|
|
(23,943)
|
|
|
|
(11,457)
|
|
|
(10,852)
|
|
|
Cash flows used in investing activities
|
|
(24,829)
|
|
|
(24,120)
|
|
|
|
(11,562)
|
|
|
(10,959)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS (USED IN) FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends paid
|
|
(26,574)
|
|
|
(25,414)
|
|
|
|
(13,286)
|
|
|
(13,227)
|
|
|
Purchase of Class A non-voting shares for cancellation
|
|
-
|
|
|
(30,112)
|
|
|
|
-
|
|
|
(30,112)
|
|
|
Repayment of long-term debt
|
|
(680)
|
|
|
(639)
|
|
|
|
(343)
|
|
|
(321)
|
|
|
Proceeds from exercise of share options
|
|
1,516
|
|
|
1,424
|
|
|
|
73
|
|
|
110
|
|
|
Cash flows used in financing activities
|
|
(25,738)
|
|
|
(54,741)
|
|
|
|
(13,556)
|
|
|
(43,550)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FOREIGN EXCHANGE (LOSS) GAIN ON CASH HELD IN
FOREIGN CURRENCY
|
|
(2,451)
|
|
|
(160)
|
|
|
|
480
|
|
|
330
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET (DECREASE) INCREASE IN CASH AND
CASH EQUIVALENTS
|
|
(22,542)
|
|
|
(15,041)
|
|
|
|
30,621
|
|
|
4,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, BEGINNING OF THE PERIOD
|
|
230,034
|
|
|
228,577
|
|
|
|
176,871
|
|
|
209,148
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, END OF THE PERIOD
|
$
|
207,492
|
|
$
|
213,536
|
|
|
$
|
207,492
|
|
$
|
213,536
|
For further information: Jeremy H. Reitman
Chairman and Chief Executive Officer | | | | Telephone: | (514) 385-2630 | | Corporate Website: | www.reitmans.ca |
|