MONTRÉAL, Sept. 12, 2024 /CNW/ -
Results
For the six month period ended July 31, 2024, the Company's revenues increased by $2,361,000 to $306,538,000 compared to $304,177,000 recorded for the corresponding period of 2023, an increase of 0.8%. Of this increase, $1,607,000 comes from investment property income from the new real estate division. Therefore, the retail operation revenues of the Tanguay division increased by 0.2%. Same-store-sales increased by 2.2% for the six month period ended July 31, 2024. Net earnings for the six month period ended July 31 ended April 30, 2024, amounted to $20,925,000 compared to $41,380,000 recorded for the corresponding period of 2023. Basic net earnings per share amounted to $0.64 compared to $1.25 recorded for the corresponding period of 2023. During the corresponding period of 2023, the Company proceeded with the sale of its Montreal distribution center resulting in an after-tax gain of $50,962,000 or $1.54 per basic share, which explains the significant difference in the Company's net income for the current year. The operating earnings at the end of the first quarter of 2024 partly reflect the impact of the synergies created following the operational and commercial reorganization carried out in May 2023 with its Tanguay division and should have a greater effect on the yearly financial results of January 31, 2025.
For the six month period ended July 31, 2024, the share repurchase program contributed to an increase of $0.01 on basic net earnings per share. As for the corresponding period of 2023, the share repurchase program had no impact on basic net earnings per share.
During the period ended July 31, 2024, the Company disposed of fixed assets in the amount of $6,948,000, resulting in an after-tax gain of $5,459,000, or $0.17 per basic share. This amount includes an after-tax gain of $2,097,000, or $0.06 per basic share, received as an additional settlement obtained by winning the case relating to the expropriation of the former Kirkland store by the Réseau express métropolitain (REM) in 2019. Finally, this amount also includes the sale of its Trois-Rivières store for an amount of $4,500,000, resulting in after-tax gain of $3,362,000, or $0.01 per basic share.
During the corresponding period of 2023, the Company proceeded with the sale of its Montreal distribution center for an amount of $66,500,000 resulting in an after-tax gain of $50,962,000 or $1.54 per basic share.
The variation in adjusted net earnings for non-recurring elements would be $25,048,000 or $0.77 per basic share for six month period ended July 31, 2024, as well as the comparable period ended July 31, 2023, are explained as follows:
(Unaudited and $ in thousands) |
|||||||||
July 31, 2024 |
July 31, 2023 |
||||||||
Net earnings |
20 925 |
41 380 |
|||||||
Gain on disposal of fixed assets (after-tax) |
(5 459) |
(50 962) |
|||||||
Adjusted net earnings |
15 466 |
(9 582) |
|||||||
Minus: Adjusted net earnings for the previous year |
(9 582) |
||||||||
Variation |
25 048 |
||||||||
The variations in net adjusted earnings is allocated as follows :
(Unaudited and $ in thousands) |
|||||||||
Increase |
Increase |
||||||||
Increase |
Increase |
(decrease) |
(decrease) |
||||||
(decrease) |
(decrease) |
immeubles de |
In adjusted |
||||||
In retal |
In investments |
In investment |
net |
||||||
As at April 30, 2024 |
4 867 |
9 958 |
(419) |
14 406 |
|||||
As at July 31, 2024 |
6 653 |
4 455 |
(466) |
10 642 |
|||||
Total |
11 520 |
14 413 |
(885) |
25 048 |
|||||
Annual financial information
($ in thousands, except for per share amounts)
January 31, 2024 |
January 31, 2023 |
||||||
Revenue |
578 945 |
717 972 |
|||||
Net earnings |
47 427 |
40 838 |
|||||
Total assets |
621 029 |
581 694 |
|||||
Net earnings per share basic and diluted |
1,44 |
1,23 |
|||||
Dividends per share |
0,36 |
0,36 |
|||||
Financial position and dividends
Cash and investments, net of bank overdraft, decreased by $76,528,000 during the six month period ended July 31, 2024. This decrease is linked to the acquisition of the RONA distribution center on April 15, 2024, the transaction was paid in full in cash from investments held by the Company. Investments consist of treasuries bearing interest, government and corporate bonds, common and preferred shares, which at the close of the six month period ended July 31, 2024, had a market value of $186,814,000 (including cash).
The Company created a real estate division at the end of the 2024 financial year, therefore as of the 1st quarter ended April 30, 2024, the Company presents its results in a segment manner identifying income from investment properties. Real estate activities include the ownership of buildings in Quebec with the intention of carrying out development or obtaining rental income from them. Details are presented in Note 4 and Note 10 to the unaudited interim consolidated financial statements as at July 31, 2024.
As at July 31, 2024, the working capital showed a surplus of $9,323,000, a decrease of $810,000 compared to the year ended January 31, 2024. The Company's shareholders' equity increased from $476,897,000 as at January 31, 2024, to $488,509,000 as at July 31, 2024. As at July 31, 2024, the book value per share stood at $15.06 compared to $14.59 as at January 31, 2024.
Pursuant to the normal course issuer-bid put in place on April 15, 2023, and renewed on April 15, 2024, accordingly, 254,950 common shares were repurchased and cancelled by the Company. As a result of this change, the Company had as at July 31, 2024, 32,430,100 common shares issued and outstanding.
During the period ended July 31, 2024, no options were granted. The Company may still grant pursuant to the Stock Option Plan a total of 5,710,864 options, representing 17.61% of the issued and outstanding shares of the Company.
Quarterly results
(Unaudited and $ in thousands, except for per share amounts)
April 30, |
April 30, |
July 31, |
July 31, |
||||||
2024 |
2023 |
2024 |
2023 |
||||||
$ |
$ |
$ |
$ |
||||||
Revenue |
137 144 |
135 102 |
169 394 |
169 075 |
|||||
Net earnings |
1 461 |
38 017 |
19 464 |
3 363 |
|||||
Net basic earnings per share |
0,04 |
1,15 |
0,60 |
0,10 |
|||||
October 31, |
October 31, |
January 31, |
January 31, |
||||||
2023 |
2022 |
2024 |
2023 |
||||||
$ |
$ |
$ |
$ |
||||||
Revenue |
140 078 |
175 559 |
134 690 |
147 815 |
|||||
Net earnings |
(8 449) |
13 847 |
14 496 |
11 938 |
|||||
Net basic earnings per share |
(0,25) |
0,42 |
0,44 |
0,36 |
|||||
For the three month period ended July 31, 2024, the Company's revenues increased by $319,000 to $169,394,000, compared to $169,075,000 recorded for the corresponding 2023 period, a 0.2% increase. Of this increase, $1,368,000 comes from investment property income from the new real estate division. Therefore, the retail operation revenues of the Tanguay division decreased by 0.6%. Same-store-sales increased by 0.6% for the three month period ended July 31, 2024. Net earnings for the three month period ended July 31, 2024, amounted to $19,464,000 compared to $3,363,000 recorded for the corresponding 2023 period. Basic net earnings per share increased to $0.60 compared to $0.10 for the corresponding 2023 period. The operating earnings at the end of the first quarter of 2024 partly reflect the impact of the synergies created following the operational and commercial reorganization carried out in May 2023 with its Tanguay division and should have a greater effect on the yearly financial results of January 31, 2025.
For the three month period ended July 31, 2024, as well as for the corresponding period of 2023, the share repurchase program had no impact on basic net earnings per share.
During the period ended July 31, 2024, the Company disposed of fixed assets in the amount of $6,948,000, resulting in an after-tax gain of $5,459,000, or $0.17 per basic share. This amount includes an after-tax gain of $2,097,000, or $0.06 per basic share, received as an additional settlement obtained by winning the case relating to the expropriation of the former Kirkland store by the Réseau express métropolitain (REM) in 2019. Finally, this amount also includes the sale of its Trois-Rivières store for an amount of $4,500,000, resulting in after-tax gain of $3,362,000, or $0.01 per basic share.
The variation in adjusted net earnings for non-recurring elements would be $10,642,000 or $0.33 per basic share for the three month period ended July 31, 2024, as well as the comparable 2023 period, are explained as follows:
(Unaudited and $ in thousands) |
|||||||||
Net earnings |
19 464 |
3 363 |
|||||||
Gain on disposal of land (after-tax) |
(5 459) |
- |
|||||||
Adjusted net earnings |
14 005 |
3 363 |
|||||||
Minus: Adjusted net earnings for the previous year |
3 363 |
||||||||
Variation |
10 642 |
||||||||
Operations
BMTC Group Inc.
Tanguay division
The Company has decided to make significant changes to transform its former Brault & Martineau and EconoMax stores into Tanguay store in order to provide a better product and service offering and a unique customer experience in its market. These renovations across our entire network were initially estimated at $28,000,000, but as of January 31, 2024, the amount was reassessed downward to $20,000,000. During the year ended January 31, 2024, $15,500,000 of these costs were recorded in operating expenses in the Consolidated Statements of Earnings and Other Comprehensive Income, and an additional $1,542,000 of theses costs were incurred for the six month period ended July 31, 2024.
At the end of April 2024, the Company finalised the purchase of land in Lévis located in the Quebec region, for an amount of $20,223,000.
Real estate division
On April 15th, 2024, the Company finalised the purchase of the RONA distribution center bearing the civic address 2055, boulevard des Entreprises in the city of Terrebonne. The transaction was in the amount of $96,000,000 before taxes which includes a lease-back agreement with RONA. The transaction was paid in full in cash from investments held by the Company. The Company intends to continue on a long-term basis to create lease revenues with this property. The Company is currently evaluating renovations costs in order to make the distribution center more efficient by automating it in order to create greater lease value.
The Company entered into a partnership agreement with Urbania, who will be responsible for the development and construction of its property at 500 boulevard Le Corbusier in Laval into several residential rental towers. The Company intends to finance this real estate project at 75% with a long-term mortgage. The estimated value of the entire project is approximately $600,000,000. The Company created a new subsidiary, Le Corbusier-Concorde S.E.C. for this real estate project on January 31st, 2022. This real estate project should begin in the summer of 2025 as we are still waiting on approval of all permits with the city of Laval before we begin the construction phase. Once construction begins, the project should span over a period of 8 to 10 years with the construction of 5 rental residential towers for a total of approximately 1,200 doors.
As announced on February 1, 2023, the Company concluded the sale of its distribution center in Montreal for an amount of $66,500,000, resulting in an after-tax gain of $50,962,000, or $1.54 per basic share. The Company remains a tenant and uses this distribution center for its operations in the Montreal metropolitan region. The initial lease was for 2 years and in February 2024, the Company renewed its lease.
The Company intends to proceed with the real estate development of several rental residential towers on its property located at 125 boul. Desjardins Est in Sainte-Thérèse. This real estate project is currently in the exploratory phase and the Company has identified a potential developer for the project. We should be able to announce during this financial year the details of this real estate project.
Management discussion and outlook for the Future of the Company
In the last few years, e-commerce has developed exponentially in Quebec. The Company continues to focus on online sales by actively pursuing the improvement of its digital platforms, its live chat initiative with online customers as well as the improvement of our telephone sales department.
It is also Management's opinion that the digital platforms of our banner is essential in order to allow the Company to increase its market shares as well as to allow customers to start their shopping experience online to then complete their purchases in one of our stores with the help of our sales representatives.
It is difficult to predict future consumer behavior, however the results for the 1st quarter of 2024 are encouraging. The economic downturn we have experienced over the past year is the result of high inflation and rising interest rates. The most sensitive sectors, such as real estate and financed products, are the most affected and are expected to continue to experience a slowdown, which could have an impact on the Company's results.
Management remains confident that, thanks to its effective management, the operational and commercial reorganization carried out in May 2023 and the solidity of its financial structure, the Company will be able to maintain its objectives which consist of increasing its market share in Quebec and its profitability, even in a more difficult market.
Caution regarding forward-looking statements
This press release 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 opposites 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 2024 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 press release. 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 press release 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 includes or excludes certain amounts that are not considered representative of the performance measures and financial recurrence of the Company. Management believes that this measure is useful in understanding and analyzing the operational performance of the Company and that it can provide additional information.
Adjusted net earnings as well as same store revenues are not an earnings measure recognized by IFRS and do not have a standardized meanings prescribed by IFRS. Therefore, adjusted net earnings and same store revenues as discussed in this press release may not be compared to similar measures presented by other issuers. These measures of performance should not be considered as alternatives to indicators of performance calculated according to IFRS, but rather as a source of additional information.
The Company discloses in this press release under the section "Results" a reconciliation between net earnings and adjusted net earnings.
BMTC Group Inc. (hereinafter "Company") is a company governed the Business Companies Act (Quebec). Its registered office and principal place of business is located at 8500 Place Marien, Montréal East, Quebec, H1B 5W8. Its common shares are listed on the Toronto Stock Exchange. The structure of BMTC Group Inc. is now formed of the Tanguay division and its subsidiaries Le Corbusier-Concorde S.E.C. and 9519-2340 Québec Inc. (collectively designated as the "Company"), manages and operates a retail network of furniture, household appliances and electronic products, in Quebec.
SOURCE BMTC Group Inc.
Information: Marie-Berthe Des Groseillers, President and Chief Executive Officer, Groupe BMTC Inc., (514) 648-5757
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