<<
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- Highlighted by a sharp 21.1% rise in net earnings and a 9.3% increase
in sales, the third quarter ended August 31, 2006 represents the 43rd
consecutive quarter of sales and earnings growth (over comparable
periods).
- Excellent financial position, further strengthened during the quarter:
almost no debt, working capital of $114.6 million and cash of
$13.9 million.
- Payment of next dividend ($0.06 per share) on November 1, 2006 to
shareholders of record as at October 18, 2006.
- Subsequent events: further expansion in the United States
After closing three acquisitions in the first quarter, Richelieu is on
track to acquire three new distributors that could double its sales in
the United States.
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TSX: RCH
MONTREAL, Oct. 4 /CNW Telbec/ - Richelieu announces strong growth for the
third quarter and the first nine months ended August 31, 2006. "All our
Canadian markets contributed to the period's growth, while our U.S. sales grew
by 17.6% (in U.S. dollars) to account for more than 12% of our total sales.
Our investments in the different marketing programs launched over the past
12 months have started to pay off, adding to the benefits of the acquisitions
we closed early in the year. Our residential and commercial woodworking and
kitchen cabinet manufacturers customers made the strongest contribution to the
period's growth, throughout our North American markets," indicated Richard
Lord, President and Chief Executive Officer.
"We are also pleased to announce three new acquisition agreements,
specifically three profitable distributors solidly established on the U.S.
East Coast. Together, they represent additional sales of more than
US$32 million on an annualized basis, and would add several thousand customers
to our U.S. customer base. If all conditions are met, we should close these
acquisitions by the end of our fiscal year as at November 30, 2006, and expect
to build excellent selling synergies with these new operations which are fully
compatible with our business," added Richard Lord.
Operating results for the third quarter ended August 31, 2006
-------------------------------------------------------------
Consolidated sales amounted to $96.2 million for the third quarter, up
9.3% over the corresponding period of 2005. Of this increase, 4.2% came from
internal growth and 5.1% from the acquisitions made in the first quarter,
specifically Atlantic Countertops (Nova Scotia) acquired in December 2005 (a
distributor of hardware products and materials for furniture and kitchen
cabinet manufacturers), Nystrom Group (Ontario) acquired in February 2006 (a
distributor of decorative products and bathroom accessories for the retailers
market including renovation superstore chains) and Kiika International
(Pennsylvania, U.S.) acquired in January 2006 (a distributor of ergonomic
office products). The quarter's internal growth was driven, among others, by
the various marketing programs made available to customers over the past
12 months.
Sales from distribution operations totalled $91.7 million, up 9.7% over
$83.6 million in the equivalent period of 2005. These operations accounted for
95.3% of consolidated sales, compared with 95.0% for the third quarter a year
earlier.
Cedan and Menuiserie des Pins, the two manufacturing subsidiaries,
generated total sales of $4.5 million, up 2.0% over the third quarter of 2005,
thereby accounting for 4.7% of the period's consolidated sales, compared with
5.0% for the third quarter of 2005. Cedan actively pursued its new product and
market development efforts, enabling it to return to sales growth in the third
quarter. In July 2006, the subsidiary Menuiserie des Pins, founded in 1946 in
the Beauce region in Quebec and specializing in the manufacture of components
for the window and door industry and an extensive selection of decorative
mouldings, celebrated 60 years of operation.
Sales to manufacturers were up 12.9% over the corresponding period of 2005
and accounted for 85.0% of third-quarter consolidated sales, compared with
82.3% for the equivalent quarter of 2005. This increase came from a
combination of organic growth and the recent acquisitions. Sales to hardware
retailers, including renovation superstores, declined by 7.4% and accounted
for 15.0% of third-quarter consolidated sales, down from 17.7% in the same
quarter of 2005.
Canadian operations generated sales of $84.6 million or 87.9% of the
period's consolidated sales, compared with $77.3 million or 87.8% of
consolidated sales for the third quarter of 2005. Of this 9.5% increase, 4.3%
came from internal growth and 5.2% from acquisitions. Canadian markets
generally achieved solid performances, especially among the residential and
commercial woodworking and kitchen cabinet manufacturers customers.
In the United States, where Richelieu makes most of its sales to
manufacturers, sales totalled $11.6 million (US$10.4 million), up from
$10.8 million (US$8.8 million) for the third quarter of 2005, an increase of
7.7% in Canadian dollars and 17.6% in U.S. dollars. This growth primarily
reflects the market development efforts made by the local teams.
Earnings before income taxes, interest, amortization and non-controlling
interest (EBITDA) rose to $14.4 million, up 20.1% over the equivalent quarter
of 2005. EBITDA from distribution operations grew significantly to
$13.1 million, up 20.4% compared with $10.9 million for the third quarter of
2005. EBITDA from manufacturing operations totalled $1.2 million, an increase
of $0.2 million or 16.5%. The enhanced performance from manufacturing
operations is notably due to the return to sales growth.
Profit margins remain most satisfactory. The gross profit margin was up
over the same quarter of 2005, and the EBITDA profit margin improved to 14.9%
from 13.6% for the equivalent period of 2005. The EBITDA profit margin from
distribution operations grew considerably compared with the third quarter of
2005, from 13.0% to 14.3%. This margin was positively affected by several
factors: better operating cost controls, a more profitable product mix, the
improvement in profitability of the U.S. operations and the contribution of
acquisitions. Furthermore, the third-quarter EBITDA profit margin from
distribution operations for the corresponding period of 2005 was negatively
affected by the intensive marketing initiatives taken by the sales to
retailers division - it should be noted that these initiatives are now
yielding benefits.
The EBITDA profit margin from manufacturing operations also improved, from
24.2% to 27.6%. This improvement resulted primarily from the increase in
manufacturing sales and tight control over the two subsidiaries' operating
expenses.
As a result of the Company's solid financial health, interest posted a
favourable variation of $0.1 million, whereas amortization was relatively
stable.
Income taxes amounted to $4.7 million, up 25.9% over the third quarter of
2005. The higher income taxes are mainly attributable to the increase in
earnings and the rise in the Quebec tax rate.
Owing to the aforementioned factors, net earnings reached a record high of
$8.8 million in the third quarter, up 21.1% over $7.3 million for the
equivalent quarter of 2005. Net earnings as a percentage of consolidated sales
worked out to 9.1%, compared with 8.2% for the third quarter of 2005. Earnings
per share amounted to $0.38 ($0.38 diluted), an increase of 22.6%, whereas the
number of outstanding shares and options did not vary significantly over the
past 12 months.
Liquidity and financial resources
---------------------------------
Cash flows from operating activities (before net change in non-cash
working capital balances related to operations) grew by 18.8% to $10.0 million
or $0.43 per share, compared with $8.4 million or $0.36 per share for the
third quarter the previous year, reflecting primarily the increase in net
earnings. After the net change in non-cash working capital balances related to
operations, cash flows amounted to $11.9 million, up 42.4% over $8.4 million
for the quarter ended August 31, 2005.
Richelieu paid a total of $1.4 million in dividends to shareholders during
the third quarter, up from $1.2 million in the same quarter of 2005. This $0.2
million increase reflects the 20% rise in the dividend rate announced on
January 25, 2006. During the period, the Company purchased shares for
cancellation for a total consideration of less than $0.1 million, compared
with $1.3 million in the third quarter of 2005. Richelieu also repaid
$0.5 million in interest-bearing debt, compared with a total of $1.1 million
in the same period of 2005. Financing activities therefore used cash flows of
$1.9 million, compared with $3.5 million for the same quarter of 2005.
Operating results for the first nine months ended August 31, 2006
-----------------------------------------------------------------
Consolidated sales totalled $281.7 million, up 9.8% over the first nine
months of 2005. Of this increase, 5.1% came from internal growth and 4.7% from
the three acquisitions made early in the current year.
Sales from distribution operations amounted to $269.0 million, up 10.6%
over $243.3 million in the corresponding period of 2005. These activities
accounted for 95.5% of consolidated sales, compared with 94.8% for the
equivalent period of 2005. Cedan and Menuiserie des Pins, the two
manufacturing subsidiaries, generated total sales of $12.7 million, down 5.3%
from the corresponding period of 2005, thereby accounting for 4.5% of
consolidated sales for the first nine months of the year, versus 5.2% for the
same period of 2005. This decline is attributable to Cedan, some of whose
customer accounts have not been renewed because those customers have
strategically refocused their operations. The subsidiary is actively pursuing
efforts to develop new products and markets, as reflected by the third-quarter
return to sales growth
For the first nine months of 2006, Richelieu made 83.0% of its sales to
manufacturers and 17.0% to hardware retailers, including renovation
superstores, compared with 81.2% to manufacturers and 18.8% to retailers for
the first nine months of 2005. Sales to manufacturers increased by 12.1%,
driven by internal growth and acquisitions, whereas sales to retailers were
down slightly by 0.4% from the corresponding period of 2005 because of the
third-quarter performance.
Canadian operations generated sales of $248.2 million or 88.1% of the
period's consolidated sales, compared with $226.2 million and 88.1% of
consolidated sales for the same period of 2005. Of this 9.7% increase, 5.0%
came from internal growth and 4.7% from expansion through acquisitions.
Canadian markets achieved healthy performances in the first nine months of
2006, especially among the commercial and residential woodworking and kitchen
cabinet manufacturers customers, which posted solid growth.
In the United States, sales amounted to $33.5 million (US$29.5 million),
compared with $30.5 million (US$24.8 million) in the same period of 2005, an
increase of 10.0% in Canadian dollars and 18.9% in U.S. dollars.
Earnings before income taxes, interest, amortization and non-controlling
interest (EBITDA) totalled $37.5 million, up 15.7% over the first nine months
of 2005. EBITDA from distribution operations posted a substantial increase of
19.6% to reach $34.7 million, over $29.0 million for the first nine months of
2005. EBITDA from manufacturing operations fell to $2.8 million, down by
$0.6 million or 17.3%.
The EBITDA profit margin greatly improved to 13.3% from 12.6% for the same
period of 2005. The EBITDA profit margin from distribution operations grew to
12.9%, up 1.0% over 11.9% in the first nine months of 2005. Conversely, the
EBITDA profit margin from manufacturing operations decreased to 22.4% this
year, down from 25.7% in 2005 because of their lower sales during the first
six months of the current year.
As a result of the Company's solid financial health and substantial
liquidity, interest posted a favourable variation of $0.2 million, which more
than offset the $0.1 million increase in amortization attributable to
acquisitions and capital expenditures in the last 12 months.
Owing primarily to the increase in earnings and the rise in the Quebec tax
rate, income taxes amounted to $12.0 million, up 20.0% over the same period of
2005.
Net earnings grew by 16.5% to $22.8 million. The net profit margin as a
percentage of consolidated sales thus reached 8.1%, compared with 7.6% for the
corresponding period of 2005. Earnings per share increased by 16.7% to $0.98
($0.98 diluted), whereas the number of outstanding shares and options did not
vary significantly over the past 12 months.
Liquidity and financial resources for the first nine months of 2006
-------------------------------------------------------------------
Cash flows from operating activities (before net change in non-cash
working capital balances related to operations) grew by 15.2% to $26.3 million
or $1.13 per share from $22.8 million or $0.98 per share for the equivalent
period the previous year, reflecting primarily the increase in net earnings.
The net change in non-cash working capital balances related to operations
required cash outlays of $8.5 million, compared with $13.2 million in 2005,
due to the fact that inventories increased less in 2006 than during the same
period of 2005. Consequently, cash flows for the first nine months of 2006
rose to $17.7 million, up 84.0% over $9.6 million in 2005.
Richelieu paid a total of $4.2 million in dividends to shareholders during
the first nine months of 2006, up from $3.5 million in the same period of
2005. This $0.7 million increase reflects the 20% rise in the dividend rate
announced on January 25, 2006. During the period, the Company purchased shares
for cancellation for a total consideration of $0.7 million, compared with
$1.3 million in 2005. Richelieu also issued $0.1 million in new shares under
its stock option plan, versus $0.9 million a year earlier. Finally, the
Company repaid $2.8 million in interest-bearing debt, an amount equivalent to
the previous year. Financing activities therefore used cash flows of
$7.6 million, compared with $6.4 million for the equivalent period of 2005.
Considering the three first-quarter acquisitions, Richelieu has invested
$16.3 million since the beginning of 2006 (compared with $2.3 million in the
same period of 2005), including $14.4 million to acquire businesses and the
balance to purchase equipment needed for its operations.
Cash and cash equivalents totalled $13.9 million as at August 31, 2006.
Financial position as at August 31, 2006
----------------------------------------
The Company's financial position remains excellent, with a low debt level
and substantial cash flows regularly generated by its operations, enabling it
to easily meet its financial obligations and to pursue its expansion and
growth. Principal balance sheet variations between November 30, 2005 and
August 31, 2006 mainly reflect the period's growth and the three first-quarter
acquisitions. Total assets amounted to $223.0 million, up 9.8% over
$203.0 million as at November 30, 2005.
Richelieu had excellent working capital of $114.6 million for a current
ratio of 4.0:1 as at August 31, 2006, compared with $105.9 million and a ratio
of 3.9:1 as at November 30, 2005, the end of its previous fiscal year.
Total interest-bearing debt amounted to $1.8 million as at August 31,
2006, a net reduction from $3.5 million as at November 30, 2005, despite a new
balance of sale of $1.1 million incurred for a business acquisition during the
first quarter of 2006.
Shareholders' equity totalled $180.8 million at the close of the third
quarter, up 11.4% over $162.3 million as at November 30, 2005. This variation
is due to the $17.9 million increase in retained earnings, which amounted to
$162.3 million as at August 31, 2006. The book value per share stood at $7.81
on August 31, 2006, compared with $7.00 nine months earlier. The Company
further improved its interest-bearing debt/equity ratio to 1% as at August 31,
2006, compared with 2.2% as at November 30, 2005.
As at August 31, 2006, 23,151,612 common shares (23,170,362 common shares
as at November 30, 2005) and 539,600 options (478,150 options as at November
30, 2005) were outstanding.
Next dividend payment
---------------------
The payment of a quarterly dividend of $0.06 per share was approved by the
Board of Directors at its October 4, 2006 meeting. This dividend is payable on
November 1, 2006 to shareholders of record as at October 18, 2006.
Subsequent events: further expansion in the United States
---------------------------------------------------------
Richelieu has just signed agreements to acquire three U.S.-based
distribution companies specializing primarily in decorative and functional
hardware. These distributors serve an extensive base of kitchen and bathroom
manufacturers customers. Should these three acquisitions close as anticipated
in the next few weeks, they would add sales of over US$32 million to
Richelieu's revenues on an annualized basis. The purchase prices will be
disclosed on the announcement of the closing and these transactions are
expected to be financed using the Company's available cash.
Growth outlook
--------------
Richelieu's priorities remain the same for the fourth quarter,
specifically to further develop its North American markets in order to
continue driving internal growth, while pursuing the integration of the
acquisitions made early this year and building upon the selling synergies from
these new operations. Expansion through business acquisitions has always been
a significant growth avenue at Richelieu and management hopes to close the
three acquisitions under way in the United States by the end of its fiscal
year as at November 30, 2006. The Company expects to close 2006 with
satisfactory growth and an even stronger financial position.
Profile as at August 31, 2006
-----------------------------
Richelieu Hardware Ltd. is Canada's leading distributor, importer and
manufacturer of specialty hardware and complementary products. The Company
also ranks among the top players in its specialty in North America. Its
products are targeted to an extensive customer base of kitchen and bathroom
cabinet, furniture, and window and door manufacturers plus the residential and
commercial woodworking industry, as well as a large customer base of hardware
retailers, including renovation superstores. Richelieu offers customers a
broad mix of high-end products sourced from manufacturers around the world.
Its product selection consists of more than 43,000 different items targeted to
a base of over 36,000 customers who are served by 40 centres in North America
- 29 distribution centres across Canada and nine in the United States plus two
manufacturing plants, specifically Cedan Industries Inc. which specializes in
the manufacture of a wide variety of veneer sheets and edgebanding products,
and Menuiserie des Pins LtDee which manufactures components for the window and
door industry, a broad selection of mouldings, and various types of tackboards
and whiteboards.
Notes to reader - Richelieu uses operating income before income taxes,
interest and amortization ("EBITDA") because this measure enables management
to assess the Company's operational performance. This measure is a widely
accepted financial indicator of a company's ability to service and incur debt.
However, EBITDA should not be considered by an investor as an alternative to
operating income or net earnings, an indicator of operating performance or
cash flows, or as a measure of liquidity. Because EBITDA is not a standardized
measurement as prescribed by GAAP, it may not be comparable to the EBITDA of
other companies.
Certain statements set forth in this press release are forward-looking
statements. In some cases, these statements are identified by the use of terms
such as "may", "could", "might", "intend" "should", "expect", "project",
"plan", "believe", "estimate" or the negative form of these expressions or
other comparable variants. These statements are based on the information
available at the time they are written, on assumptions made by management and
on the expectations of management, acting in good faith, regarding future
events and relate, by their very nature, to known and unknown risks and
uncertainties such as economic conditions, exchange rate fluctuations and
other factors set forth in the management's report included in the Company's
Annual Report for 2005 as well as in Richelieu's Annual Information Form,
which is available on the System for Electronic Document Analysis and
Retrieval (SEDAR) website at www.sedar.com. Actual results could differ
materially from those indicated or underlying these forward-looking
statements. The reader is therefore cautioned not to unduly rely on these
forward-looking statements. Forward-looking statements do not reflect the
potential impact of any special item, any business combination or any other
transaction that may be announced or occur subsequent to the date hereof.
Richelieu undertakes no obligation to update or revise the forward-looking
statements to account for new events or new circumstances, except where
provided for by applicable legislation.
CONFERENCE CALL ON OCTOBER 4, 2006 AT 2:30 P.M.
-----------------------------------------------
Financial analysts and investors interested in participating in the
conference call on Richelieu's results to be held at 2:30 p.m. on October 4,
2006, can dial 1-800-796-7558 a few minutes before the start of the call. For
those unable to participate, a taped rebroadcast will be available as of
4:30 p.m. on October 4, 2006, until midnight on October 12, 2006, by dialing
1-877-289-8525, access code: 21204461 (pound key). Members of the media are
invited to listen in.
Consolidated statements of earnings and retained earnings (unaudited)
(in thousands of dollars, except per-share amounts)
For the nine months For the three months
ended August 31, ended August 31,
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2006 2005 2006 2005
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$ $ $ $
Sales 281,687 256,647 96,221 88,032
Cost of sales, warehouse,
selling and
administrative expenses 244,145 224,194 81,868 76,080
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Earnings before the
following 37,542 32,453 14,353 11,952
Interest on short-term
debt, net (70) 97 (72) 17
Interest on long-term debt 65 83 21 27
Amortization of capital
assets 2,614 2,499 874 842
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Earnings before income
taxes and non-controlling
interest 34,933 29,774 13,530 11,066
Income taxes 11,971 9,974 4,668 3,707
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Earnings before
non-controlling interest 22,962 19,800 8,862 7,359
Non-controlling interest 196 254 83 108
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Net earnings 22,766 19,546 8,779 7,251
-----------------------
-----------------------
Retained earnings,
beginning of period 144,430 122,710
Premium on redemption
of common shares for
cancellation (713) (1,250)
Dividends (4,168) (3,479)
--------------------------------------------------
Retained earnings,
end of period 162,315 137,527
--------------------------------------------------
--------------------------------------------------
Earnings per share (Note 4)
Basic 0.98 0.84 0.38 0.31
Diluted 0.98 0.84 0.38 0.31
See accompanying notes.
Consolidated statements of cash flows (unaudited)
(in thousands of dollars)
For the nine months For the three months
ended August 31, ended August 31,
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2006 2005 2006 2005
-------------------------------------------------------------------------
$ $ $ $
OPERATING ACTIVITIES
Net earnings 22,766 19,546 8,779 7,251
Items not affecting cash
Amortization of capital
assets 2,614 2,499 874 842
Non-controlling interest 196 254 83 108
Future income taxes 225 183 75 75
Stock-based compensation
expense 452 300 161 121
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26,253 22,782 9,972 8,397
Net change in non-cash
working capital balances
related to operations (8,541) (13,156) 1,975 (5)
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17,712 9,626 11,947 8,392
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FINANCING ACTIVITIES
Issue of common shares
(Note 3) 145 947 63 15
Dividends paid (4,168) (3,479) (1,389) (1,160)
Redemption of common
shares for cancellation (741) (1,291) (63) (1,291)
Increase in long-term debt -- 201 -- 60
Repayment of long-term debt (925) (2,298) (545) (453)
Decrease of bank loans (1,910) (520) -- (691)
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(7,599) (6,440) (1,934) (3,520)
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INVESTING ACTIVITIES
Business acquisitions
(Note 2) (14,391) -- (116) --
Additions to capital
assets (1,927) (2,290) (659) (264)
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(16,318) (2,290) (775) (264)
-------------------------------------------------------------------------
Net change in cash and
cash equivalents (6,205) 896 9,238 4,608
Cash and cash equivalents
at beginning of period 20,103 9,747 4,660 6,035
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Cash and cash equivalents
at the end of period 13,898 10,643 13,898 10,643
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Supplemental information
Income taxes paid (13,531) (13,320) (5,711) (3,409)
Interest received
(paid) - net (3) (179) 42 (45)
See accompanying notes.
Consolidated balance sheets
(in thousands of dollars)
As at As at As at
August 31, August 31, November 30,
2006 2005 2005
-------------------------------------------------------------------------
$ $ $
(unaudited) (unaudited) (audited)
ASSETS
Current assets
Cash and cash equivalents 13,898 10,643 20,103
Accounts receivable 53,502 46,396 49,837
Income taxes receivable -- 89 --
Inventories 84,070 77,593 71,636
Prepaid expenses 1,157 715 470
-------------------------------------------------------------------------
152,627 135,436 142,046
Capital assets 18,613 19,391 18,974
Goodwill 51,718 41,951 41,951
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222,958 196,778 202,971
-------------------------------------------------------------------------
-------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Bank loans -- 2,083 1,910
Accounts payable and accrued
liabilities 35,880 33,523 32,718
Income taxes payable 425 -- 751
Current portion of long term debt 1,759 1,282 740
-------------------------------------------------------------------------
38,064 36,888 36,119
-------------------------------------------------------------------------
Long-term debt 16 1,037 849
Future income taxes 1,999 1,817 1,774
Non-controlling interest 2,125 1,849 1,929
-------------------------------------------------------------------------
42,204 41,591 40,671
-------------------------------------------------------------------------
Shareholders' equity
Capital stock (Note 3) 17,503 17,297 17,386
Contributed surplus (Note 3) 936 363 484
Retained earnings 162,315 137,527 144,430
-------------------------------------------------------------------------
180,754 155,187 162,300
-------------------------------------------------------------------------
222,958 196,778 202,971
-------------------------------------------------------------------------
-------------------------------------------------------------------------
See accompanying notes.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
August 31, 2006 and 2005 (in thousands of dollars, except per-share
amounts) (unaudited)
1) ACCOUNTING POLICIES
The unaudited interim consolidated financial statements have been prepared
by management in accordance with accounting principles generally accepted in
Canada and follow the same accounting principles and methods of application as
the recent annual consolidated financial. In the management opinion, these
interim financial statements reflect all the adjustments required to fair
presentation. These adjustments consist only of normal recurring adjustments.
Operating results for the period are not necessarily indicative of the results
that may be expected for the full year as the operating level of the Company
is subject to seasonal fluctuations. These interim financial statements should
be read in conjunction with the audited consolidated annual financial
statements and the accompanying notes included in Company's annual report for
the fiscal year 2005.
2) BUSINESS ACQUISITIONS
On December 5, 2005, the Company acquired the principal net assets items
of Atlantic Countertops Limited, for a cash consideration of $10,061. This
business based in Dartmouth, Nova Scotia, specializes in the distribution of
specialty hardware products and materials for furniture and kitchen
manufacturers and operates two distribution centres, the main one located in
Dartmouth and the other in Moncton, New Brunswick.
On January 16, 2006, the Company acquired the principal net assets items
of Kiika International LLC in Pennsylvania, USA, a distributor specialized in
ergonomic office products, for a cash consideration of $487 and a balance of
sale of $256.
Finally, on February 8, 2006, the Company acquired all the outstanding
shares of Nystrom Group Inc., an Ontario distributor of decorative hooks and
bathroom hanging accessories for the retailers, for a cash consideration of
$3,843 and a balance of sale of $855.
The purchase price allocation process is not completed as yet, and the
amounts assigned to the assets and liabilities may be adjusted at a later
date, mainly the identification of intangible assets, their evaluation and
consequently the determination of final amount to allocate to goodwill. The
allocation of the purchase price will be completed upon availability of this
information.
These transactions were accounted for by the purchase method and the
results of operations are included in the financial statements from the
purchase date.
Summary of acquisitions
-------------------------------------------------------------------------
2006 2005
$ $
-------------------------------------------------------------------------
Net assets acquired
Current assets 6,708 --
Capital assets 326 --
Provisional intangible assets -- --
Provisional goodwill 9,767 --
-------------------------------------------------------------------------
16,801 --
Current liabilities assumed 1,299 --
-------------------------------------------------------------------------
Net assets acquired 15,502 --
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Consideration
Cash 14,391 --
Balances of sale payable 1,111 --
-------------------------------------------------------------------------
-------------------------------------------------------------------------
3) CAPITAL STOCK
Issued
As at August 31, 2006, capital stock outstanding amounted to 23,151,612
common shares (23,170,362 common shares as at November 30, 2005).
During the 9-month period ended August 31, 2006, the Company issued 16,550
common shares (2005- 138,300) at a weighted average price of $8.69 per share
(2005- $6.85) under the share option plan. In addition, the Company, through a
normal course issuer bid, purchased for cancellation 35,300 common shares for
a cash consideration of $741.
Stock option plan
During the third quarter, 2,000 options were granted by the Company so
that the nine-month period ended August 31 2006 ended with a total of 82,000
options granted (2005- 215,000) with an average exercise price of $22.40 per
share (2005- $22.13) and an average fair value of $7.70 per option (2005-
$8.00) as determined using Black & Scholes option pricing model using an
expected dividend yield of 1% (2005- 0.83%), a volatility of 25% (2005- 25%),
an average risk free interest rate of 4.16% (2005- 4.40%) and an expected life
of 8 years (2005- 8 years). As at August 31, 2006, 539,600 options were
outstanding (478,150 as at November 30, 2005) with exercise prices varying
from $4.26 to $22.43 (2005- $4.26 to $22.13) for a weighted average price of
$17.07 (2005- $15.91).
For the 3-month and 9-month periods ended August 31, 2006, the stock-based
compensation expense amounted to $161 (2005- $121) and $452 (2005- $300)
respectively.
4) EARNINGS PER SHARE
3-MONTH PERIOD ENDED AUGUST 31
2006 2005
---------------------------- ------------------------------
---------------------------- ------------------------------
Weighted Weighted
average average
number of Earnings number of Earnings
shares per shares per
Earnings (in share Earnings (in share
$ thousands) $ $ thousands) $
Basic net
earnings 8,779 23,151 0.38 7,251 23,192 0.31
Dilutive
effect
of stock
options -- 120 (0.00) -- 169 (0.00)
---------------------------- ------------------------------
Diluted net
earnings 8,779 23,271 0.38 7,251 23,361 0.31
---------------------------- ------------------------------
---------------------------- ------------------------------
9-MONTH PERIOD ENDED AUGUST 31
2006 2005
---------------------------- ------------------------------
---------------------------- ------------------------------
Weighted Weighted
average average
number of Earnings number of Earnings
shares per shares per
Earnings (in share Earnings (in share
$ thousands) $ $ thousands) $
Basic net
earnings 22,766 23,156 0.98 19,546 23,163 0.84
Dilutive
effect
of stock
options -- 126 (0.00) -- 164 (0.00)
---------------------------- ------------------------------
Diluted net
earnings 22,766 23,282 0.98 19,546 23,327 0.84
---------------------------- ------------------------------
---------------------------- ------------------------------
5) SEGMENTED INFORMATION
3-MONTH PERIODS ENDED AUGUST 31
Manu-
Distribution facturing Total
$ $ $
-------------------------------------------------------------------------
2006
External sales 91,698 4,523 96,221
Inter-segment sales -- 1,169 1,169
Earnings before taxes, interest
and amortization 13,104 1,249 14,353
Amortization of capital assets 668 206 874
Goodwill 49,718 2,000 51,718
Total assets 206,636 16,322 222,958
Additions to capital assets and
goodwill 726 49 775
-------------------------------------------------------------------------
-------------------------------------------------------------------------
2005
External sales 83,596 4,436 88,032
Inter-segment sales -- 788 788
Earnings before taxes, interest and
amortization 10,880 1,072 11,952
Amortization of capital assets 637 205 842
Goodwill (November 30, 2005) 39,951 2,000 41,951
Total assets (November 30, 2005) 187,118 15,853 202,971
Additions to capital assets and
goodwill 179 85 264
-------------------------------------------------------------------------
-------------------------------------------------------------------------
9-MONTH PERIODS ENDED AUGUST 31
Manu-
Distribution facturing Total
$ $ $
-------------------------------------------------------------------------
2006
External sales 269,025 12,662 281,687
Inter-segment sales -- 3,306 3,306
Earnings before taxes, interest and
amortization 34,700 2,842 37,542
Amortization of capital assets 1,957 657 2,614
Goodwill 49,718 2,000 51,718
Total assets 206,636 16,322 222,958
Additions to capital assets and
goodwill 11,177 517 11,694
-------------------------------------------------------------------------
-------------------------------------------------------------------------
2005
External sales 243,283 13,364 256,647
Inter-segment sales -- 3,258 3,258
Earnings before taxes, interest and
amortization 29,018 3,435 32,453
Amortization of capital assets 1,879 620 2,499
Goodwill (November 30, 2005) 39,951 2,000 41,951
Total assets (November 30, 2005) 187,118 15,853 202,971
Additions to capital assets and
goodwill 1,672 618 2,290
-------------------------------------------------------------------------
-------------------------------------------------------------------------
>>
During the three-month and nine-month periods ended August 31, 2006, the
Company's sales to foreign countries, primarily directed to the United States,
amounted to $11,604 (2005- $10,770) and $33,515 (2005- $30,473) respectively
in Canadian dollars and to $10,362 (2005- $8,812) and $29,496 (2005- $24,800)
respectively in U.S. dollars.
| Home > Quotes & Charts > News > News Article |
|
Richelieu Hardware Ltd. (RCH) Exchange: Toronto Stock Exchange
|
$38.360 
May 25, 2013, 7:30 PM EDT
Change:
0.21 (0.55%)
Volume: 2,197
Day Low
38.120
38.120
Day High
38.630
38.630
Richelieu achieves an excellent third quarter and announces three new business acquisition agreements in the United States
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