MONTREAL, Jan. 21, 2016 /CNW Telbec/ - At its Annual Meeting of Shareholders held this morning at the Boucherville Cage, SPORTSCENE GROUP INC. ("Sportscene" or "the Company") (TSXV: SPS.A) announced financial results in line with management's expectations for the 13-week period ended November 29, 2015. As anticipated, the Company's strategic repositioning, which was officialized last fall with the launch of the new La Cage – Brasserie sportive brand image, has already started to yield benefits, leading to a significant improvement of the network's performance.
Financial Results
During the 13-week period, despite a sluggish month of September throughout the La Cage network and the fact that it comprised two fewer restaurants than the previous year, total network sales (1) posted a 3.4% year-over-year increase to stand at $27.1 million.
Management is pleased with this renewed organic sales growth considering that it is mainly attributable to the repositioning of the La Cage – Brasserie sportive banner, including the extensive enhancement of its food offering and beer selection. Furthermore, as attested to by the first-quarter trend in network results, the official launch of the new brand image had a beneficial impact on the Cages' customer traffic as soon as of October. The implementation of the new interior design in a certain number of Cages since 2014 is also driving the performance of the renovated Cages, which are posting superior organic sales growth to the network average.
Sportscene's revenues grew by $3.3 million to $20.7 million, thanks primarily to a $2.9 million increase in the revenues generated by the Company's core business, the "Restaurant" segment, as a result of the August 2015 acquisition of two restaurants operating under another banner, the increase in La Cage branded products in grocery stores and the improvement in average same-Cage sales (2). The two latter factors also had a positive impact on consolidated adjusted EBITDA (3), which grew by $0.2 million over the previous year to stand at $1.4 million.
Consequently, Sportscene closed the first quarter of fiscal 2016 with net earnings of $0.2 million or $0.05 per share (basic and diluted), compared with barely positive net earnings and earnings per share a year earlier.
2016 Objectives and Outlook
Fiscal 2016 will be the third and final year of transition toward La Cage's new positioning, the positive effects of which should continue to materialize. Management expects the Company's financial performance for 2016 to improve in comparison with 2015, although it is mostly as of fiscal 2017 that Sportscene should reap the full financial benefits of its strategic repositioning.
For the current fiscal year, Sportscene intends to further enhance La Cage's customer experience. Among its primary goals, it will also continue to focus on the quality of execution network-wide through employee mobilization, the support provided to operators and the creative use of new training tools. Finally, Sportscene plans to resume the network's expansion by opening new Cages, including large-scale units toward the end of the current fiscal year.
"We are all the more motivated as our results since the launch of our new brand image allow us to anticipate accelerated network growth," concluded Jean Bédard, President and Chief Executive Officer.
Appointment
The Company is pleased to announce the appointment of Cynthia Jodoin as Vice-President, Human Resources. This appointment attests to the priority the Company accords to mobilizing and training Sportscene's and La Cage's 2,400 employees, whom it considers key to the success of its strategic shift.
Profile
Sportscene Group is a pioneer and a leader in the ambience restaurant niche in Quebec, where it has operated a chain of sports-themed resto-bars for the last 30 years. Originally known as La Cage aux Sports, the chain's name was changed to La Cage – Brasserie sportive ("La Cage") in September 2015, to reflect its new Food, Beer, Sports positioning following a major upgrading of its food offering and beer selection. Enjoying a strong brand image, the province-wide La Cage banner comprised 49 units at the date hereof. The Cages offer complete foodservices and bar services in a sophisticated sports-inspired décor featuring the most advanced audiovisual technologies.
| The following items are not performance measures consistent with IFRS: |
|
| (1) |
Total network sales correspondent to sales achieved by all La Cage restaurants: franchisees, partnerships and corporate units. |
| (2) |
Average same-Cage sales isolate the impact of restaurant openings and closures to assess the actual trend in restaurant sales. |
| (3) |
In Sportscene's statement of comprehensive income, adjusted EBITDA corresponds to "Earnings before financial expenses, amortization, share of net earnings of joint ventures and associates and income taxes", from which other (gains) and losses are excluded. |
For further information regarding the results and financial position of Sportscene Group Inc., refer to the management's report as well as the unaudited consolidated financial statements and accompanying notes for the 13-week period ended November 29, 2015, available on SEDAR.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
| Interim Condensed Consolidated Statements of Comprehensive Income |
||||
| November 29, |
13 weeks ended |
|||
| $ |
$ |
|||
| Revenues |
20,677 |
17,342 |
||
| Cost of sales |
6,960 |
5,633 |
||
| Selling and administrative expenses, excluding amortization |
12,321 |
10,522 |
||
| Other gains (losses) |
(71) |
10 |
||
| Earnings before financial expenses, amortization, share of net |
1,467 |
1,177 |
||
| Amortization |
1,105 |
981 |
||
| Financial expenses |
181 |
163 |
||
| Share of net earnings of joint ventures and associates |
(47) |
19 |
||
| 1,239 |
1,163 |
|||
| Earnings before income tax expenses |
228 |
14 |
||
| Income tax expenses |
48 |
9 |
||
| Net earnings and comprehensive income |
180 |
5 |
||
| Net earnings and comprehensive income attributable to: |
||||
| The Company's shareholders |
228 |
25 |
||
| Non-controlling interests |
(48) |
(20) |
||
| Net earnings and comprehensive income |
180 |
5 |
||
| Earnings per share (in $): |
||||
| Basic |
0.05 |
0.01 |
||
| Diluted |
0.05 |
0.01 |
||
| Weighted average number of outstanding Class A shares (in thousands): |
||||
| Basic |
4,165 |
4,165 |
||
| Diluted |
4,165 |
4,221 |
||
SOURCE Sportscene Group Inc.
Image with caption: "Sportscene Group Inc. Logo (CNW Group/Sportscene Group Inc.)". Image available at: http://photos.newswire.ca/images/download/20160121_C7967_PHOTO_EN_602950.jpg
Jean Bédard, Chairman of the Board, President and Chief Executive Officer; Josée Pépin, Vice-President, Finance, 450-641-3011
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