BMTC Group Inc. announces financial results for its quarter ended March 31st, 2015

MONTREAL, May 7, 2015 /CNW Telbec/ -

Results

For the quarter ended March 31^st, 2015, the Company's revenues increased by $4,162,000 to $149,280,000, compared to $145,118,000 recorded in the corresponding 2014 period. Net earnings for the quarter ended March 31^st, 2015, amounted to $59,000 compared to a net loss of $1,468,000 for the corresponding 2014 period. For the quarter ended March 31^st, 2015, the Company recorded a basic net earnings per share of $0.00 compared to a basic net loss per share of $0.03 for the corresponding 2014 period.

Same store revenues increased by 1.60% for the same period. The improvement of net earnings is essentially due to an increase of gross margins.

The share repurchase program had no impact on basic net earnings per share during the first quarter of 2014 and 2015.

Excluding these effects, the net earnings would have been $1,250,000 or $0.03 per basic share.

The $1,250,000 variation in adjusted net earnings in 2015 breaks down as follows:

	2015		2014
	($ in thousands)
Net (loss) earnings	59		(1 468)
Variation of cost of options (after-tax)	(130)		147
Adjusted net loss	(71)		(1 321)
Minus: Adjusted net loss for 2014	(1 321)
Variation	1 250

This variation in adjusted after-tax income is allocated as follows:

($ in thousands)
	Increase (decrease) retail earnings		Increase (decrease) investment		Increase (decrease) adjusted earnings
1^st quarter 2015	1 464		(214)		1 250

Annual Financial Information
($ in thousands, except for per share amounts)

Revenue		2014	2013
		$	$
		701 356	694 743
Net earnings		48 647	57 254
Total assets		362 350	306 296
Net earnings per share
	basic	1,08	1,24
	diluted	1,08	1,24
Dividends per share		0,24	0,24

Financial Position

Cash and investments decreased by $3,871,000 during the three month period ended March 31^st, 2015. Investments consist primarily of bank notes, government bonds, as well as preferred and common shares, which at the close of the period had a market value of $153,794,000 (including cash).

As of March 31^st, 2015, the working capital was of $6,108,000, a decrease of $10,865,000 compared to December 31^st, 2014. The Company's shareholders' equity decreased from $255,426,000 as at December 31^st, 2014 to $254,279,000 as at March 31^st, 2015. As of March 31^st, 2015, the book value per share stood at $5.66, compared to $5.68 as at December 31^st, 2014.

During the three month period ended March 31^st, 2015, no options were granted. On March 31^st, 2015, 21,900 options were cancelled. As at March 31^st, 2015, options for 229,950 Class A Subordinate Voting Shares, representing 0.51% of the Company's outstanding shares remain issued and 5,710,864 authorized share options, representing approximately 12.72% of the Company's outstanding shares, may still be granted pursuant to the Plan. The issued and outstanding options may be exercised at a price of $17.85 per Class A Subordinate Voting Shares.

The number of outstanding shares of the Company changed during the three month period ended March 31^st, 2015 pursuant to the normal course issuer bid March 12^th, 2014 which was renewed on March 13^th, 2015 and the conversion of Class B Multiple Voting Shares. Accordingly, 67,838 Class A Subordinate Voting Shares were repurchased and cancelled by the Company. As a result of these changes the Company had on March 31^st, 2015, 1,748,796 Class B Multiple Voting Shares and 43,145,066 Class A Subordinate Voting Shares outstanding.

Quarterly Results (Unaudited)
($ in thousands, except for per share amounts)

		March 31		June 30		September 30		December 31
		2015	2014	2014	2013	2014	2013	2014	2013
		$	$	$	$	$	$	$	$
Revenue		149 280	145 118	182 881	181 411	190 207	187 315	183 150	174 168
Net earnings (loss)		59	(1 468)	14 020	13 574	18 271	15 840	17 824	26 625
Net earnings  (loss) per share
	Basic	0,00	(0,03)	0,31	0,29	0,40	0,34	0,40	0,58
	Diluted	0,00	(0,03)	0,31	0,29	0,40	0,34	0,40	0,58

Operations

During 2014, the Company proceeded with a complete upgrade of all of its websites and plans to implement a distinct e-commerce platform for all of its banners. This upgrade commenced in 2014 and will continue throughout 2015. The Company has already established its e-commerce strategy as well as its web tactics with the help of external advisors and specialists. During the third quarter of 2014, the Company signed a contract and proceeded with the purchase of an e-commerce platform. The implementation of which has also started during this period. The Company has also reviewed its IT systems in order to standardise them across its banners, as well as align them with its e-commerce strategies. Following this evaluation, the Company has decided to invest in a new IT system for all of its banners. The integration and implementation has also begun and will continue over the next 18 months. The costs related to these modifications are estimated to approximately 10,600,000$ which will be allocated during the 2015 period.

Brault & Martineau

The Company is presently evaluating the remodeling of all of its furniture and electronic departments of all of its stores. The strategy behind this remodeling is to offer our clients a unique experience in our store that will help allow us to differentiate ourselves from electronic commerce. The costs related to these improvements for the next two years are estimated to be 15,000,000$.

EconoMax

In April 2015 the Company opened a new store in Granby, the costs related to the opening will be charged in the second quarter of 2015. The Company has purchased land in Drummondville, where the construction of the store will begin in the second quarter of 2015 for an eventual store opening in the fall of 2015. Following the opening in Drummondville, the banner will have 11 stores in the province of Quebec.

Management Discussion and Outlook for the Future of the Company 

During the last quarter of 2014 the Company saw its revenues increase substantially compared with the corresponding period of 2013. Management believes that this trend in revenue growth will remain in 2015 due to the considerable decrease in gas prices and the additional decrease in interest rates. This should improve considerably consumer spending in 2015.

Caution regarding forward-looking statements

This Quarterly Management Report contains certain forward-looking statements with respect to the Company. These forward-looking statements are identified by the use of terms and phrases such as "anticipate", "believe", "estimate", expect", "intend", "may", "plan", "predict", "project", "will", "would", as well as the negative of these terms and similar terminology, including references to assumptions.

Forward-looking statements, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by these forward-looking statements. Results indicated in forward-looking statements may differ materially from actual results for a number of reasons which the Company has identified in the 2014 Annual Information Form under "Narrative Description of the Business – Risk Factors", and other risks detailed from time to time in the Company's continuous disclosure documents.

The reader is cautioned that the factors we refer above are not exhaustive of the factors that may affect any of the Company's forward-looking statements. The reader is also cautioned to consider these and other factors carefully and not to put undue reliance on forward-looking statements.

The Company made a number of assumptions in making forward-looking statements in this Quarterly Management Report. The Company considers the assumptions on which these forward-looking statements are based to be reasonable.

These statements reflect current expectations regarding future events and operating performance and speak only as of the date of release of this Quarterly Management Report, and represent the Company's expectations as of that date. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by law.

Non International Financial Reporting Standards (IFRS) financial measures

The Company discloses adjusted net earnings, which includs or excluds certain amounts that are not considered representative of performance measures and financial recurrence of the Company. Management believes that this measure is useful in understanding and analysing the operational performance of the Company.

The Company discloses in this MD&A under the section "Results" a reconciliation between net earnings and adjusted net earnings.

Adjusted net earnings are not an earnings measure recognised by IFRS and does not have a standardised meaning prescribed by IFRS. Therefore, adjusted net earnings as discussed in this MD&A may not be compared to similar measures presented by other issuers. This measure of performance should not be considered as an alternative as an indicator of performance, but rather as additional information.

Same store revenues are not an earnings measure recognised by IFRS and does not have a standardised meaning prescribed by IFRS. Therefore, same store sales as discussed in this MD&A may not be compared to similar measures presented by other issuers.

BMTC Group Inc.'s Class A Subordinate Voting Shares are listed on the Toronto Stock Exchange and through its subsidiaries, ABTM Group Inc. and Ameublements Tanguay Inc., is a major retailer of furniture, electronic goods and household appliances operating in the province of Quebec.

SOURCE BMTC Group Inc.

Mr. Yves Des Groseillers, Chairman, President and Chief Executive Officer, BMTC Group Inc., [phone]