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Press release from Marketwire

Goodfellow Reports Its Results for the Fiscal Year Ended August 31, 2010

Thursday, November 04, 2010

Goodfellow Reports Its Results for the Fiscal Year Ended August 31, 201009:26 EDT Thursday, November 04, 2010DELSON, QUEBEC--(Marketwire - Nov. 4, 2010) - Goodfellow Inc. (TSX:GDL) announced today its financial results for the fiscal year ended August 31, 2010. The Company generated net income for the fiscal year 2010 of $12.7 million or $1.48 per share compared to a net income (before extraordinary gain) of $7.5 million or $0.87 per share during fiscal 2009. The net income from operations for fiscal 2009 excludes the extraordinary gain of $3.4 million or $0.39 per share which represents the gain resulting from the expropriation of part of our Delson facility. Consequently, Net income including the extraordinary gain for Fiscal 2009 reached $10.8 million or $1.26 per share. Consolidated sales for the fiscal year ended August 31, 2010 were $504.5 million compared to $437.9 million for the same period a year ago. Cash flow from operations (excluding non-cash working capital) for fiscal 2010 increased to $13.8 million from $9.5 million for the same period last year. Business conditions during fiscal year ended August 31, 2010 progressively improved across all of our regional markets except in the US. Housing starts in Canada continued its progression month over month and outperformed last year. Consolidated sales were positively impacted by the Home Renovation Tax Credit ("HRTC") in the first half of Fiscal 2010, by the announcement of the Harmonized Sales Tax ("HST") in Ontario and BC on July 1st 2010 and finally, the strong push by our sales team to achieve pre-recession sales level achieving over $500 million.During the Fourth quarter, the Company generated net income from operations of $4.9 million or $0.57 per share compared to net income of $5.3 million or $0.62 per share a year ago. Consolidated sales for the fourth quarter of fiscal 2010 were $147.4 million compared to $125.3 million for the same period a year ago. Cash flow from operations (excluding non-cash working capital) for the fourth quarter of fiscal 2010 decreased to $5.6 million from $5.8 million for the same period last year."The 4th Quarter was marked by a colossal effort to grow our market share taking advantage of our healthy inventories" said Richard Goodfellow, President and Chief Executive Officer. "We believe our team will continue to grow our market share, new products will contribute more, and opportunities will certainly continue to present themselves along the way for a company with a solid balance sheet."Goodfellow Inc. is one of eastern Canada's largest independent re-manufacturers and distributors of lumber and hardwood flooring products. Goodfellow shares trade on the Toronto Stock Exchange under the symbol GDL.GOODFELLOW INC.Consolidated statements of earningsYears ended August 31, 2010 and 2009(in thousands of dollars, except per share amounts)20102009$$Sales504,477437,946ExpensesCost of goods sold, selling, administrative, and general expenses483,254423,911Amortization1,5071,433Financial1,2511,182Foreign currency loss368433486,380426,959Earnings before income taxes and extraordinary item18,09710,987Income taxes5,4343,524Net earnings before extraordinary item12,6637,463Extraordinary gain, net of income taxes of $961-3,373Net earnings12,66310,836Earnings per shareNet earnings before extraordinary item1.480.87Extraordinary item-0.39Basic and diluted1.481.26GOODFELLOW INC.Consolidated statements of retained earningsYears ended August 31, 2010 and 2009(in thousands of dollars)20102009$$Balance, beginning of year101,93294,559Net earnings12,66310,836114,595105,395Dividends(7,715)(3,430)Redemption of shares-(33)Balance, end of year106,880101,932Consolidated statements of comprehensive incomeYears ended August 31, 2010 and 2009(in thousands of dollars)20102009$$Net Income12,66310,836Other comprehensive incomeForeign currency translation adjustment-303Total other comprehensive income-303Comprehensive income12,66311,139GOODFELLOW INC.Consolidated balance sheets as at August 31, 2010 and 2009(in thousands of dollars)20102009$$AssetsCurrent assetsCash548580Accounts receivable81,18465,330Inventories63,36746,163Prepaid expenses1,6471,768146,746113,841Capital assets30,53830,369Deferred pension asset6,5204,701183,804148,911LiabilitiesCurrent liabilitiesBank indebtedness27,1325,427Accounts payable and accrued liabilities35,96429,417Income taxes payable1,58423964,68035,083Future income taxes3,0222,67467,70237,757Shareholders' equityCapital stock9,2229,222Retained earnings106,880101,932116,102111,154183,804148,911GOODFELLOW INC.Consolidated statements of cash flowsYears ended August 31, 2010 and 2009(in thousands of dollars)20102009$$Cash flows from operating activitiesNet earnings12,66310,836Adjustments for:Extraordinary item-(4,334)Amortization1,5071,433Amortization included in cost of good sold1,046970Future income taxes3481,176Loss on disposal of capital assets837Shortage of expense over pension plan funding(1,819)(873)Impact of foreign exchange on cash-30313,7539,548Changes in non-cash working capital items(25,045)12,815(11,292)22,363Cash flows used by financing activitiesIncrease (decrease) increase in bank loan13,000(13,186)Increase (decrease) in banker's acceptances10,000(5,000)Redemption of common shares-(40)Dividends(7,715)(3,430)15,285(21,656)Cash flows used by investing activitiesAcquisition of capital assets(2,757)(2,841)Proceeds on disposal of capital assets27181(2,730)(2,660)Net cash inflow (outflow)1,263(1,953)(Bank overdraft), beginning of year(4,847)(2,894)Bank overdraft, end of year(3,584)(4,847)Bank overdraft is comprised of:Cash548580Bank overdraft(4,132)(5,427)(3,584)(4,847)Additional cash flow informationInterest paid777725Income taxes paid3,7411,025Unpaid fixed assets4129FOR FURTHER INFORMATION PLEASE CONTACT: Richard GoodfellowGoodfellow Inc.President and CEO450-635-6511450-635-3730 (FAX)info@goodfellowinc.com