BMTC GROUP INC. ANNOUNCES FINANCIAL RESULTS FOR THE YEAR ENDED JANUARY 31st, 2023.

MONTREAL, April 27, 2023 /CNW/ - 

Results 

For the year ended January 31, 2023, the Company's revenues decreased by $101,473,000 to $717,972,000 compared to $819,445,000 recorded for the year ended January 31, 2022, a 12.4% decrease. Net earnings for the year ended January 31, 2023, amounted to $40,838,000 compared to $81,931,000 recorded for the year ended January 31, 2022. Basic net earnings per share amounted to $1.23 compared to $2.43 recorded for the year ended January 31, 2022.

For the year ended January 31, 2023, the share repurchase program contributed to an increase of $0.01 on basic net earnings per share, whereas during the year ended January 31, 2022, it contributed to an increase of $0.02 on basic net earnings per share.

The Company met the eligibility criteria for the Canadian Emergency Wage Subsidy (CEWS) during the year ended January 31, 2022. The Company received $1,441,000 after-tax which contributed to an increase of $0.04 on basic net earnings per share.

The variation in adjusted net earnings would be ($39,652,000) or ($1.19) per basic share for year ended January 31, 2023, as well as the comparable period ended January 31, 2022, are explained as follows:

				($ in thousands)
				January 31, 2023					January 31, 2022
Net earnings					40 838				81 931
CEWS (after-tax)					-				(1 441)
Adjusted net earnings					40 838				80 490
Minus: Adjusted net earnings for 2022					80 490
Variation					(39 652)

The variations in net adjusted earnings is allocated as follows:

								Increase
		Increase			Increase			(decrease)
		(decrease)			(decrease)			in adjusted
		in retail operations			in investment			net earnings
As at April 30, 2022		1 670			(10 098)			(8 428)
As at July 31, 2022		(6 428)			(8 009)			(14 437)
As at Oct. 31, 2022		(6 089)			(56)			(6 145)
As at Jan. 31, 2023		(15 693)				5 051			(10 642)
Total		(26 540)			(13 112)			(39 652)

Annual financial information
($ in thousands, except for per share amounts)

				January 31, 2023		January 31, 2022
				$		$
Revenue				717 972		819 445
Net earnings				40 838		81 931
Total assets				581 964		549 926
Net earnings per share basic and diluted				1,23		2,43
Dividends per share				0,36		0,34

Financial position and dividends

Cash and investments, net of bank overdraft, decreased by $17,696,000 during the year ended January 31, 2023. Investments consist of treasuries bearing interest, government and corporate bonds and common shares, which at the close of the quarter had a market value of $219,630,000 (including cash).

As at January 31, 2023, the working capital showed a surplus of $21,566,000 an increase of $21,935,000 compared to the year ended January 31, 2022. The Company's shareholders' equity increased from $387,866,000 as at January 31, 2022, to $440,899,000 as at January 31, 2023. As at January 31, 2023, the book value per share stood at $13.34, compared to $11.60 as at January 31, 2022.

Pursuant to the normal course issuer-bid put in place on April 15, 2022, and renewed on April 15, 2023, accordingly, 382,600 common shares were repurchased and cancelled by the Company. As a result of this change, the Company had as at January 31, 2022, 33,040,400 common shares issued and outstanding.

During the year ended January 31, 2023, no options were granted. The Company may still grant pursuant to the Plan a total of 5,710,864 options, representing 17.28% of the issued and outstanding shares of the Company.

During the fiscal year ended January 31, 2023, the Company paid eligible dividends totalling $0.36 per common share to holders.

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

			April 30,		April 30,		July 31,		July 31,
			2022		2021		2022		2021
			$		$		$		$
Revenue			175 659		177 208		218 939		231 624
Net earnings			807		10 479		14 246		28 683
Net basic earnings per share			0,02		0,31		0,43		0,85
			October 31,		October 31,		January 31,		January 31,
			2022		2021		2023		2022
			$		$		$		$
Revenue			175 559		213 955		147 815		196 658
Net earnings			13 847		20 189		11 938		22 580
Net basic earnings per share			0,42		0,60		0,36		0,67

For the three month period ended January 31, 2023, the Company's revenues decreased by $48,843,000 to $147,815,000, compared to $196,658,000 recorded for the corresponding 2022 period, a 24.8% decrease.  Net earnings for the three month period ended January 31, 2023, amounted to $11,938,000 compared to $22,580,000 recorded for the corresponding 2022 period. Basic net earnings per share decreased to $0.36 compared to $0.67 for the corresponding 2022 period.

For the three month period ended January 31, 2023, the share repurchase program contributed to a decrease of $0.01 on basic net earnings per share, whereas during the corresponding 2022 period, contributed to an increase of $0.01 on basic net earnings per share.

The variation in adjusted net earnings would be ($10,642,000) or ($0.32) per basic share for the three month period ended January 31, 2023, as well as the comparable 2022 period, are explained as follows:

				($ in thousands)
				January 31, 2023					January 31, 2022
Adjusted net earnings					11 938				22 580
Minus: Adjusted net earnings for 2022					22 580
Variation					(10 642)

Operations

On September 12th, 2022, the Company started the migration to a single IT system for all of its banners.  We are pleased to announce that the IT system implementation and integration process, including its e-commerce platform, was successfully completed on December 5th, 2022, and is fully operational. We are very proud of our IT employees who delivered ahead of schedule, as was reported in our last management report roll out was planned by the end of the year. All of our employees have received complete training on our new system and in this very short period of time of being fully operational, we can already notice important value added as well as time and cost efficiencies.

This IT standardisation has allowed the Company to create significant operational synergies. We have now completed the merged of our administrative and operational services of Brault & Martineau, EconoMax and Tanguay banners and therefore created broad and diversified teams that are better able to cope with the realities of business today. During the next few months of operating with only one IT system and e-commerce platform, we will continue to review our administrative and operational services and we believe we will be able to improve our efficiency and be even more cost effective.

These important changes come at an opportune time for the Company. The difficulty of obtaining skilled labour, the retail trade that is constantly changing and evolving, the competition that is now spread across Canada and the United States of America and the shift of consumer spending towards e-commerce means that this change will allow the Company to be much more agile in its business decisions. We believe that the IT standardisation as well as the organisational and structural changes will enable the Company to maintain its leadership in its market, as well as significantly improve its profitability and financial structure and continue its objectives of increasing its market share in Quebec.

On December 1st, 2022, BMTC Group Inc. proceeded with a simplified vertical merger with its subsidiary Ameublements Tanguay Inc. The structure of BMTC Group Inc. is now formed of three divisions, Brault & Martineau, EconoMax and Ameublements Tanguay divisions and its subsidiary Le Corbusier-Concorde S.E.C..

The Company entered into a partnership agreement for the development of its property at 500 boulevard Le Corbusier in Laval into several residential rental towers. The Company created a new subsidiary, Le Corbusier-Concorde S.E.C. for this real estate project on January 31st, 2022. The Company is still negotiating and waiting for permits with the city of Laval for this project. Once the green light from the city of Laval is obtained, The Company will therefore be able to disclose the full extent of this real estate development.

The Company concluded on February 1, 2023, the sale of its distribution centre 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 will remain a tenant under a 2 year lease with  renewal options.

Management discussion and outlook for the Future of the Company

The Company continues to focus on online sales, which experienced a record increase since the start of the pandemic in 2020, 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 for all of the Companies banners.

It is also Management's opinion that the digital platforms of our banners are 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 the future level of consumer spending, although we are now seeing that the Company's results in the last quarter are not reflecting the performance of the last two years. This downward trend continued in subsequent months. We can therefore expect a significant drop, if the trend continues. This is partly explained by the high rate of inflation in terms of the cost of food, the cost of gas and the rise in interest rates, which has a direct impact on consumer spending. Also, management is aware that the increase in the last two years was partly due to the fact that the Company benefited from a transfer of consumer spending related to the restrictions imposed by the various levels of government due to COVID-19 pandemic, more precisely the restrictions related to travel, the closure of restaurants and all other forms of entertainment in the cultural and sporting world. Since these restrictions are no longer in place, consumer spending has in part transfer back to these types of spending.

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 2023 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. 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 Company, through its subsidiary Le Corbusier-Concorde S.E.C.  and its three divisions Brault & Martineau, EconoMax and Ameublements Tanguay, manages and operates a retail network of furniture, household appliances and electronic products, in Quebec.

SOURCE BMTC Group Inc.

Marie-Berthe Des Groseillers, President and Chief Executive Officer, Groupe BMTC Inc., [phone]