Canlan Reports Third Quarter 2012 Financial Results

- Same store revenue growth over 6% -

BURNABY, BC, Nov. 14, 2012 /CNW/ - Canlan Ice Sports Corp. (TSX: ICE), industry-leading providers of recreational and multi sport facilities across North America, today announced its financial results for the three - and nine-month period ended September 30, 2012.

Q3 2012 Key Financial Metrics

In thousands except share data	Q3 2012	Q3 2011	Change
Total revenue	$15,231	$14,805	+3%
EBITDA^1	$186	$2	+$184
Net earnings (loss) before taxes	($1,613)	$368*	-$1,981
Net earnings (loss) after taxes	($1,164)	$117*	-$1,281
Net earnings (loss) per share	($0.09)	$0.01*	-$0.10
	Sept. 30, 2012	Sept. 30, 2011
Total Assets	$103,096	$106,658	-3%
Cash and Cash equivalents	$10,661	$5,946	+79%
Total Interest bearing debt	$40,515	$47,085	-14%

*Includes a one-time $2.3 million gain on sale of assets recorded in Q3 2011

"Our Q3 revenue growth was solid and we continue to manage our expenses well, which resulted in a positive EBITDA for the quarter," said Joey St-Aubin, President and CEO of Canlan Ice Sports.  "Increases in F&B sales, ASHL pricing, programs and sponsorship revenue lead to a solid 6.1% growth rate in same store sales for the quarter."

Q3 2012 Operational and Financial Highlights

• Revenue of $15.2 million, an increase of 2.9% over Q3 2011
• Same store revenue up $0.9 million or 6.1% over Q3 2011
• EBITDA of $0.2 million for Q3 2012, up $184,000 from Q3 2011
• Same store EBITDA was $0.4 million higher than the prior year
• Cash balance at quarter end was $10.7 million compared to $5.9 million a year ago

Highlights Subsequent to Quarter-End

• Canlan Sportsplex Mississauga, our newest complex housing indoor courts and soccer fields,  opened its doors to soccer user groups in early October and the construction of the food and beverage area is expected to be completed and commence operation in November 2012
• Introduced Club Hockey Canada to its Adult Safe Hockey League (ASHL); a loyalty program in partnership with Hockey Canada

Review of Q3 and YTD 2012 Financial Results
Canlan derives its revenue from the rental of its playing surfaces, registrations for internal programming, food and beverage sales, sports stores sales, tournament registrations, sponsorship, management and other related fees.

Canlan reported consolidated revenue of $15.2 million for the three-month period ended September 30, 2012, up 2.9% from $14.8 million for the corresponding period of 2011.  The revenue growth was primarily due to an increase in F&B sales, ASHL pricing, programs revenue and sponsorship revenue.

Same store revenue of $14.9 million increased by $0.9 million or 6.1% compared to 2011.  Same store F&B sales increased by $0.2 million compared to the prior year due to a general increase of foot traffic from youth program registrations and tournaments operated by our tournament division in the facilities during the summer period.  Same store revenue from the ASHL increased by $0.1 million principally due to pricing and same store programs revenue increased by $0.3 million due to  and increase in summer youth camps and 3 on 3 youth leagues in various regions as a result of effective marketing efforts.

On a nine-month basis, Canlan generated consolidated revenue of $52.5 million for FY2012, up 2.1% from $51.4 million for FY2011. Same store revenue of $50.8 million increased by $2.0 million or 4.1% compared to 2011.  The improvement in same store revenue was mainly due to increased ASHL revenue (winter and summer seasons combined), third party contract ice rentals, programs revenue and membership revenue in Canlan's Adult Safe Hockey Network.

Direct operating expenses were $14.0 million, up 1.5% from $13.8 million for Q3 2011. The year-over-year increase was attributable to increased labour and repairs and maintenance costs.

For the nine-month period of FY2012 operating expenses were $43.6 million, up 2.1% from $42.7 million for FY2011.  The year-over-year increase was due to higher labour costs and repair and maintenance expenses.

Corporate general and administrative expenses totaled $1.0 million, up 3.5% from Q3 2011, due mainly to wage increases. On a nine-month basis, general and administrative expenses totaled $3.6 million for FY2012 and $3.3 million for FY2011, respectively.

EBITDA was $0.2 million for the third quarter of the year versus break-even for Q3 2011.  EBITDA for the nine-month period of FY2012 was $5.3 million, down 2.4% from $5.4 million for FY2011.  On a same store basis, EBITDA of $5.9 million increased by $0.3 million or 5.5%.

Canlan generated a net loss before taxes of $1.6 million for Q3 2012, a decrease from a net gain before taxes of $0.4 million in Q2 2011.  On a year-to-date basis, Canlan generated a loss before taxes of $0.4 million for FY2012 compared to earnings before taxes of $1.9 million for FY2011, which included a $2.3 million gain on sale of assets.

Net loss for the third quarter of 2012 was $1.2 million or $0.09 per share. In the third quarter of 2011, Canlan generated net earnings of $0.1 million, or $0.01 per share.  For the nine-month period of FY2012, Canlan generated a net loss of $0.5 million or $0.04 per share.  This compares to net earnings of $1.0 million or $0.07 per fully diluted share for same period of FY2011.

At September 30, 2012, the Company held cash and cash equivalents of $10.7 million and interest bearing debt totaling $40.5 million. This compares to $13.9 million and $42.0 million, respectively, at December 31, 2011.

"The third quarter of 2012 was marked by improving revenue growth and relatively stable expenses," said Mr. Michael Gellard, Canlan's CFO. "Our cash position continues to grow while at the same time, our total interest bearing debt is decreasing.  We remain in a strong and flexible financial position which allows us to continue with our dividend policy and pursue attractive new opportunities such as Romeoville and Canlan Sportsplex, Mississauga."

"Same store revenue for Q3 was strong and our new facility in Romeoville is performing as expected and contributing to our profitability," said Mr. St-Aubin.  "Our first ever, non-ice facility in Mississauga, has begun operations, with very positive feedback from our customers."

Canlan's financial statements and Management Discussion & Analysis for the period ended September 30, 2012 will be available via SEDAR on or before November 14, 2012 and through the Company's website, www.icesports.com.

About Canlan
Canlan Ice Sports Corp. is the North American leader in the development, operations and ownership of multi-purpose recreation and entertainment facilities. We are the largest private sector owner and operator of recreational ice sports facilities in North America and currently own and/or manage 21 facilities in Canada and the United States with 60 ice surfaces, as well as indoor soccer fields, ball diamonds, curling rinks and volleyball courts.  To learn more please visit www.icesports.com.

Canlan Ice Sports Corp. is listed on the Toronto Stock Exchange under the symbol "ICE."

Caution concerning forward-looking statements
Certain statements in this MD&A may constitute ''forward looking'' statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. When used in this MD&A, such statements may use such words as ''may'', ''will'', ''expect'', ''believe'', ''plan'' and other similar terminology. These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this MD&A. These forward looking statements involve a number of risks and uncertainties. Some of the factors that could cause actual results to differ materially from those expressed in or underlying such forward looking statements are the effects of, as well as changes in: international, national and local business and economic conditions; political or economic instability in the Company's markets; competition; legislation and governmental regulation; and accounting policies and practices. The foregoing list of factors is not exhaustive.

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¹ Earnings before interest, taxes, depreciation and amortization (EBITDA) is often used as a measure of financial performance. However, EBITDA is a not a term that has specific meaning in accordance with IFRS, and may be calculated differently by other companies.

 

SOURCE: Canlan Ice Sports Corp.

Canlan Ice Sports Corp.
Michael F. Gellard
Senior Vice President & CFO
604 736 9152

TMX Equicom
Philip Dale
416 815 0700 ext. 253
[email protected]