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Press release from CNW Group

Taiga's Q1 affected by volatile commodity prices

Thursday, August 08, 2013

Taiga's Q1 affected by volatile commodity prices

19:50 EDT Thursday, August 08, 2013

BURNABY, BC, Aug. 8, 2013 /CNW/ - Taiga Building Products Ltd. ("Taiga" or the "Company") today reported first quarter ended June 30, 2013 financial results.

Three Months Ended June 30, 2013

The Company's consolidated net sales for the quarter ended June 30, 2013 were $335.8 million compared to $309.5 million in the same period last year. The 8% increase in sales was largely due to higher year over year commodity prices and improved sales volume from US operations and export operations selling into the United States and Asian markets.

Gross margin for the quarter ended June 30, 2013 decreased to $25.4 million from $30.8 million in the same period last year. Gross margin percentage for the quarter declined to 7.6% compared to 9.9% in the same period last year. This decline was primarily due to a sharp fall in commodity prices during the quarter, generating inventory losses as a result.

Net earnings for the quarter ended June 30, 2013 decreased to $1.5 million from $5.9 million in the same period last year primarily due to decreased gross margin.

EBITDA for the quarter ended June 30, 2013 was $9.6 million from $15.4 million in the same period last year primarily due to decreased gross margin.

Condensed Consolidated Statement of Earnings

For the Three Months Year Ended

  June 30,
(in thousands of Canadian dollars, except for per share amounts) 2013 2012
Sales       335,803 309,508
Gross margin 25,424 30,756
Distribution expense 4,416 4,524
Selling and administration expense 12,804 12,013
Finance expense 2,078 1,903
Subordinated debt interest expense 4,089 4,071
Other income (383) (260)
Earnings before income taxes 2,420 8,505
Income tax expense 907 2,588
Net earnings 1,513 5,917
Net earnings per share(1) 0.05 0.18
EBITDA(2) 9,591 15,425

The following is the reconciliation of net earnings to EBITDA:

    June 30, 
(in thousands of Canadian dollars)   2013 2012
Net earnings   1,513 5,917
Income tax expense   907 2,588
Finance and subordinated debt interest expense   6,167 5,974
Amortization   1,004 946
EBITDA   9,591 15,425

Notes:
(1) Earnings per share is calculated using the weighted average number of shares.
(2) Reference is made above to EBITDA, which represents earnings before interest, taxes, and amortization. As there is no generally accepted method of calculating EBITDA, the measure as calculated by Taiga might not be comparable to similarly titled measures reported by other issuers. EBITDA is presented as management believes it is a useful indicator of a company's ability to meet debt service and capital expenditure requirements and because management interprets trends in EBITDA as an indicator of relative operating performance. EBITDA should not be considered by an investor as an alternative to net income or cash flows as determined in accordance with IFRS.

The foregoing selected financial information is qualified in its entirety by and should be read in conjunction with, our unaudited condensed interim consolidated financial statements for the three months ended June 30, 2013 and accompanying notes and management's discussion and analysis which will be available shortly on SEDAR at www.sedar.com.

SOURCE: Taiga Building Products Ltd.

For further information:

For further information regarding Taiga, please contact: 

Mark Schneidereit
CFO & Vice President, Finance and Administration
Phone: 604-438-1471 Fax: 604-439-4242

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