Sportscene Group and La Cage - Brasserie sportive Achieve Their Best Quarterly Results since 2012

MONTREAL, July 11, 2018 /CNW Telbec/ - Management of SPORTSCENE GROUP INC. ("Sportscene" or "the Company") (TSXV: SPS.A) is proud to announce that the growth in its financial results continued during the third quarter of fiscal 2018, both in terms of sales and profits, generating the best quarterly performance of the past six years. 

For the 13-week period ended May 27, 2018, total sales ⁽¹⁾ of the La Cage – Brasserie sportive network posted a 2.9% increase to stand at $33.5 million. This increase is attributable to the growth in average same-Cage sales ⁽²⁾, in line with the upward trend that has characterized the network's performance for more than two years. Sportscene's consolidated revenues amounted to $27.3 million, up 4.7% over the corresponding quarter of preceding year, while consolidated adjusted EBITDA ⁽³⁾ increased by 28.8% to $3.4 million. Sportscene ended the third quarter of fiscal 2018 with net earnings of $1.5 million or $0.34 per share, up 68.7% over the previous year.

For the 39-week period ended May 27, 2018, network sales ⁽¹⁾ grew by 6.8% to total $96.5 million. Sportscene's consolidated revenues increased by 10.3% to $77.3 million, mainly due to the strong performance of the La Cage network. For the same reason, consolidated adjusted EBITDA ⁽³⁾ increased by 28.9% to $8.4 million. Sportscene's year-to-date net earnings increased by 85% to total $2.8 million or $0.65 per share.

Sportscene's President and Chief Executive Officer Jean Bédard said that the sustained increase in average same-Cage sales and significant improvement in the profitability of both the restaurants and the Company reflect the success of the La Cage banner. "Our restaurants stand out as much for their modern, sports-themed and friendly ambiance as for their food offering based on fresh, local products. Since the beginning of the fiscal year, we have continued to prioritize employee training and engagement, as well as technological innovation. We also continued modernizing the network of Cages, approximately two-thirds of which now feature the new design."

Outlook

"Our future growth partly depends on new developments compatible with our restaurant operations. With this in mind, we recently signed a partnership agreement with the owners of L'Avenue restaurants to develop this banner through franchising. Its high-end breakfast concept complements our vision of fresh food options based on local procurement. In addition, we intend to open new locations in the coming year, both under the P.F. Chang's banner and for our new À Domicile restaurant concept, which will provide group entertainment and reception areas targeting the 20 to 35 year-old consumer segment", the C.E.O. added. 

Declaration of a Dividend of $0.30 Per Share

Sportscene Group announces that its Board of Directors today declared a dividend of $0.30 per Class A share, which will be paid on August 14, 2018 to shareholders of record as at July 27, 2018. This decision was motivated by the sustained growth in the Company's financial results over the last several quarters, its sound financial position and substantial cash assets, as well as its favourable outlook.

Profile

Sportscene Group is a pioneer and a leader in the ambience restaurant niche in Quebec, where it has operated a chain of resto-bars since 1984: La Cage – Brasserie sportive ("La Cage"). In addition to its sports-themed ambience, La Cage stands out for its fresh food offering, based on local procurement. Enjoying a strong brand image, La Cage comprises 43 units located across Quebec at the date hereof. The Cages offer complete foodservices and bar services in a sophisticated sports-inspired décor featuring the most advanced audio-visual technologies.

The following items are not performance measures consistent with IFRS: 

Reconciliation of Non-IFRS Financial Measures
(in thousands of $, except percentages)	13 weeks ended		39 weeks ended
	May 27, 2018	May 28, 2017	May 27, 2018	May 28, 2017
Restaurant revenues ^(4)	23,958	21,082	65,824	57,898
Food concession revenues	(1,602)	(497)	(3,954)	(1,763)
Non-banner revenues	(1,710)	(1,419)	(4,880)	(4,245)
Revenue from franchises and joint ventures	12,828	13,355	39,512	38,508
Total network sales ^(1)	33,474	32,521	96,502	90,398
Income before financial expenses, amortization, net (income) loss of joint ventures and associates and income taxes	3,065	2,475	7,293	5,928
Other (gains) loss	(24)	(71)	74	(117)
Earnings before financial expenses, amortization and income taxes of joint ventures and associates ^(5)	369	243	1,038	712
Consolidated adjusted EBITDA ^(2)	3,410	2,647	8,405	6,523

(1)	Total network sales correspondent to sales achieved by all La Cage restaurants, including corporate units, partnerships and franchises.
(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, consolidated adjusted EBITDA corresponds to "Earnings before financial expenses, amortization, net income of joint ventures and associates and income taxes", from which other losses (gains) are excluded, and to which the Company's share of earnings before financial expenses, amortization and income taxes of joint ventures and associates is added.
(4)	Restaurant revenue figures are disclosed in Note 5 "Revenues" accompanying the interim condensed consolidated financial statements.
(5)	For further details, see Note 11 "Investments in joint ventures and associates" accompanying the interim condensed consolidated financial statements.

For further information regarding the results and financial position of Sportscene Group Inc., refer to the management report as well as the interim condensed consolidated financial statements and accompanying notes for the 13 and 39-week periods ended May 27, 2018, which are 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
(in thousands of Canadian dollars, except for earnings per share and number of outstanding shares)
(unaudited)
		13 weeks ended		39 weeks ended
		May 27,	May 28,	May 27,	May 28,
		2018	2017	2018	2017
		$	$	$	$
Revenues		27,267	26,048	77,294	70,097
Cost of sales		8,000	8,762	24,277	22,773
Selling and administrative expenses, excluding amortization		16,226	14,882	45,650	41,513
Other (gains) losses		(24)	(71)	74	(117)
Earnings before financial expenses, amortization, share of net (income) loss of joint ventures and associates and income tax		3,065	2,475	7,293	5,928
Amortization		1,170	1,174	3,702	3,490
Financial expenses		220	182	637	589
Share of net (income) loss of joint ventures and associates		(188)	(57)	(512)	(127)
Income before income tax expenses		1,863	1,176	3,466	1,976
Income tax expenses		365	288	709	483
Net income and comprehensive income		1,498	888	2,757	1,493
Net income and comprehensive income attributable to:
The Company's shareholders		1,465	876	2,756	1,495
Non-controlling interests		33	12	1	(2)
Net income and comprehensive income		1,498	888	2,757	1,493
Earnings per share (in dollars):
	Basic	0.34	0.21	0.65	0.36
	Diluted	0.34	0.21	0.65	0.36
Weighted average number of outstanding Class A shares (in thousands):
	Basic	4,263	4,165	4,223	4,165
	Diluted	4,281	4,165	4,241	4,165

SOURCE Sportscene Group Inc.

Jean Bédard, Chairman of the Board, President and Chief Executive Officer; François-Xavier Pilon, Vice-President, Finance, 450-641-3011

Related Links

http://www.cage.ca