PR Newswire: news distribution, targeting and monitoring
2014
See more news releases in Food & Beverages  | Earnings

Brick Brewing delivers $0.4M EBITDA

Share with Twitter Share with LinkedIn

Supported Brands Deliver Volume Growth.

KITCHENER, ON, Sept. 12, 2013 /CNW/ - Brick Brewing Co. Limited ("Brick" or the "Company") (TSX:BRB), the largest Canadian-owned and Canadian-based publicly held brewery in Ontario, today released its financial results for the second quarter of its 2014 fiscal year. The Company's key brands, its growth pillars for the future, performed well in the quarter with Laker volume up 11%, Waterloo up 22% and Seagram coolers and ciders up 5% from the same period last year. The volume gains were achieved amidst a beer category that experienced declines of approximately 5%-6% over the same period, driven by cool summer weather.

Net Revenues for the second quarter of fiscal 2014 were $11.4 million compared to $11.5 million in the second quarter of fiscal 2013. The impact of higher volumes was eroded by sales mix and pricing pressure from large brewers' nationally supported brands. Gross profit for the quarter declined to 21.4% in the second quarter of fiscal 2014, from 33.2% in Q2 of the prior year, the result of a shift in package size mix as well as higher operating cost to support free can-in-case promotional activity. EBITDA for the second quarter of fiscal 2014 decreased to $0.4 million compared to EBITDA of $2.4 million in the second quarter of fiscal 2013. Increased advertising behind Laker, Waterloo and Seagram, coupled with a free can-in-case promotion to support the launch of Laker 12-pack bottles were drivers to the EBITDA result.

"We have made clear and thoughtful choices for this Company's future and the game plan is playing out" stated George Croft, President and CEO. "Waterloo and Seagram are higher margin offerings that compete in key growth segments - craft beer, ciders and coolers. Investing in these brands was central to the volume growth we've seen year-to-date. As well, a strong and stable Laker business is the foundation of our business. Our Laker 12-pack free can-in-case was successful in driving awareness and trial. We maintain our focus on costs, and these efforts will pay dividends. We continue to work to deliver improved pricing and margins. Despite challenging financial results for the second quarter and year to date, as a shareholder I'm confident in our ability to deliver improved performance in the second half of fiscal 2014."

Financial highlights are as follows:

  • Net Revenues for the second quarter of fiscal 2014 were $11.4 million compared to $11.5 million in the second quarter of fiscal 2013.

  • Gross profit margin for the quarter declined to 21.4% from 33.2% in Q2 of fiscal 2013, with higher costs of goods driven by product launch promotions.

  • Selling, Marketing and Administration ("SM&A") expenses increased to $2.7 million from $2.0 million in the prior year, driven by brand support for Laker, Waterloo & Seagram.

  • EBITDA* for the second quarter of fiscal 2014 decreased to $0.4 million compared to EBITDA* in the second quarter of fiscal 2013 of $2.4 million.

The following financial information should be read in conjunction with the audited annual financial statements of the Company prepared under IFRS for the year ended January 31, 2013.



Reconciliation of Net Earnings to Earnings Before Interest, Taxes, Depreciation and Amortization, Gain/Loss on Disposal of Property, Plant and Equipment, and Share Based Payments (EBITDA)*

     Quarter ended     Fiscal year-to-date ended 
(in thousands of dollars)     July 28, 2013     July 29, 2012     July 28, 2013     July 29, 2012
                         
Net income (loss)    $ (458)    $ 1,112    $ (403)    $ 1,454
                         
Add (deduct):                        
  Income tax expense (recovery)     (158)     391     (138)     516
  Depreciation and amortization     762     640     1,482     1,263
  Loss (gain) on disposal of property, plant and equipment     31     -     (15)     -
  Share based payment     49     69     102     74
  Finance costs     164     162     327     275
Subtotal     848     1,262     1,758     2,128
                         
EBITDA*     390     2,374     1,355     3,582

 




STATEMENTS OF COMPREHENSIVE INCOME
For the periods ended July 28, 2013 and July 29, 2012
(Not audited or reviewed by the Company's external auditor)

     Quarter ended     Fiscal year-to-date ended 
       July 28, 2013       July 29, 2012       July 28, 2013       July 29, 2012 
                         
Revenue    $ 11,372,254    $ 11,486,863    $ 20,157,000    $ 20,112,826
Cost of sales     8,938,854     7,676,398     15,409,866     14,079,137
Gross profit     2,433,400     3,810,465     4,747,134     6,033,689
Selling, marketing and administration expenses     2,741,593     2,026,031     4,661,363     3,574,016
Other expenses     143,637     119,281     299,883     214,851
Finance costs     164,396     162,280     326,930     274,925
Income (loss) before tax     (616,226)     1,502,873     (541,042)     1,969,897
Income tax expense (recovery)     (158,000)     390,457     (138,000)     515,957
Net income (loss) and comprehensive
  income (loss) for the period
   $ (458,226)    $ 1,112,416    $ (403,042)    $ 1,453,940
                         
                         
Basic earnings (loss) per share    $ (0.01)    $ 0.04    $ (0.01)    $ 0.05
Diluted earnings (loss) per share    $ (0.01)    $ 0.04    $ (0.01)    $ 0.05

 



STATEMENTS OF FINANCIAL POSITION
As at July 28, 2013 and January 31, 2013
(Not audited or reviewed by the Company's external auditor)

      July 28, 2013      January 31, 2013 
             
ASSETS            
  Non-current assets            
    Property, plant and equipment    $ 19,413,555    $ 19,109,603
    Intangible assets     14,520,048     14,259,612
    Other assets     45,000     25,000
    Deferred income tax assets     2,671,925     2,533,925
      36,650,528     35,928,140
             
  Current assets            
    Cash     102,602     -
    Accounts receivable     8,174,463     5,187,785
    Inventories     3,816,495     4,013,375
    Prepaid expenses     468,242     296,180
      12,561,802     9,497,340
TOTAL ASSETS     49,212,330     45,425,480
             
LIABILITIES AND EQUITY            
  Equity            
    Share capital     38,953,043     35,895,873
    Share-based payments reserves     967,748     1,092,414
    Deficit     (7,798,785)     (7,395,743)
  TOTAL EQUITY     32,122,006     29,592,544
             
  Non-current liabilities            
    Provisions     335,999     326,646
    Long-term debt and promissory note     6,507,153     6,078,719
      6,843,152     6,405,365
             
  Current liabilities            
    Bank indebtedness     -     2,310,809
    Accounts payable and accrued liabilities     8,344,746     5,461,292
    Current portion of long-term debt and promissory note     1,902,426     1,655,470
      10,247,172     9,427,571
TOTAL LIABILITIES     17,090,324     15,832,936
             
COMMITMENTS            
             
TOTAL LIABILITIES AND EQUITY    $ 49,212,330    $ 45,425,480

 



STATEMENTS OF CASH FLOWS
For the periods ended July 28, 2013 and July 29, 2012
(Not audited or reviewed by the Company's external auditor)

     Quarter ended     Fiscal year-to-date ended 
       July 28, 2013       July 29, 2012       July 28, 2013       July 29, 2012 
Operating activities                        
  Net income (loss)    $ (458,226)    $ 1,112,416    $ (403,042)    $ 1,453,940
  Adjustments for:                        
    Income tax expense (recovery)     (158,000)     390,457     (138,000)     515,957
    Finance costs     164,396     162,280     326,930     274,925
    Depreciation and amortization of property, plant and
equipment and intangibles
    762,270     639,858     1,482,216     1,262,476
    Loss (gain) on disposal of property, plant and equipment     30,933     -     (15,092)     -
    Share-based payments     48,634     68,864     101,803     74,251
    Change in non-cash working capital related to operations     (371,010)     (1,259,741)     (136,906)     (2,220,117)
  Less:                        
    Interest paid     (151,270)     (120,919)     (275,163)     (234,004)
Cash provided by (used in) operating activities     (132,273)     993,215     942,746     1,127,428
                         
Investing activities                        
    Purchase of property, plant and equipment     (764,698)     (351,100)     (1,974,076)     (1,164,901)
    Proceeds from sale of property, plant and equipment     140,000     -     203,000     -
    Purchase of intangible assets     (121,392)     (168,774)     (260,436)     (253,938)
Cash used in investing activities     (746,090)     (519,874)     (2,031,512)     (1,418,839)
                         
Financing activities                        
    Increase/(decrease) in bank indebtedness     (2,047,074)     (257,796)     (2,314,214)     716,555
    Decrease in obligation under financial lease     -     (6,146)     -     (10,232)
    Issuance of long-term debt     500,000     -     1,185,912     -
    Repayment of long-term debt     (296,462)     (209,399)     (511,031)     (417,287)
    Change in share capital     -     -     -     2,375
    Proceeds from warrants, net     2,824,501     -     2,814,501     -
    Issurance of shares, net of fees     -     -     16,200     -
Cash provided by/(used in) financing activities     980,965     (473,341)     1,191,368     291,411
                         
Net increase/(decrease) in cash     102,602     -     102,602     -
                         
Cash, beginning of period     -     -     -     -
Cash, end of period    $ 102,602    $ -    $ 102,602    $ -

 




Additional Information

For further details the Company's complete management discussion and analysis (MD&A) and financial statements for the quarter ended July 28, 2013 will be available on the investor section of the Brick Brewing website at www.brickbeer.com. This and additional information relating to the Company, including its Annual Information Form, is or will be available on the Company's website and on SEDAR at www.sedar.com.

About Brick Brewing

Brick is Ontario's largest Canadian-owned and Canadian-based publicly held brewery. The Company is a regional brewer of award-winning premium quality and value beers and is officially certified under British Retail Consortium (BRC) Global Standards for Food Safety, one of the highest and most internationally recognized standards for safe food production. Founded in 1984, Brick Brewing Co. was the first craft brewery to start up in Ontario, and is credited with pioneering the present day craft brewing renaissance in Canada. Brick has complemented its Waterloo brand premium craft beers with other popular brands such as Laker, Red Baron, Red Cap and Formosa Springs Draft.  In March 2011, Brick purchased the Canadian rights to the Seagram Coolers and now produces, sells, markets and distributes Seagram Coolers across Canada.  Brick trades on the TSX under the symbol BRB. Visit us at www.brickbeer.com.

Forward-Looking Statements

Except for the historical information contained herein, the discussion in this press release contains certain forward-looking statements that involve risks and uncertainties, such as statements of the Company's plans, objectives, strategies, expectations and intentions and include, for example, the statements concerning expected volumes, EBITDA, demand, operating efficiencies and costs.  Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "anticipate", "seek", "plan", "believe" or "continue" or the negatives of these terms or variations of them or similar terminology.  Although the Company believes that the expectations and assumptions reflected in these forward-looking statements are reasonable, undue reliance should not be placed on these forward-looking statements.  These forward-looking statements are not guarantees and reflect the Company's views as of September 11, 2013 with respect to future events.  Future events are subject to certain risks, uncertainties and assumptions, which may cause actual performance and financial results to differ materially from such forward-looking statements. The forward-looking statements, including the statements regarding expected volumes, EBITDA, demand, operating efficiencies and costs are based on, among other things, the following material factors and assumptions: sales volumes in the fiscal year ending January 31, 2014 ("fiscal 2014") will increase; no material changes in consumer preferences; brewing, blending, and packaging efficiencies will improve; the cost of input materials for brewing and blending will increase; the cost of packaging materials will decrease; competitive activity from other manufacturers will continue; no material change to the regulatory environment in which the Company operates and no material supply, cost or quality control issues with vendors.   Readers are urged to consider the foregoing factors and assumptions when reading the forward-looking statements and, for more information regarding the risks, uncertainties and assumptions that could cause the Company's actual financial results to differ from the forward-looking statements, to also refer to the remainder of the discussion in this press release, the Company's annual information form and various other public filings as and when released by the Company.  The forward-looking statements included in this press release are made only as of September 11, 2013 and, except as required by applicable securities laws, the Company does not undertake to publicly update such forward-looking statements to reflect new information, future events or otherwise.

* EBITDA is a non-IFRS earnings measure, therefore it does not have any standardized meaning prescribed by International Financial Reporting Standards  and may not be similar to measures presented by other companies. EBITDA represents earnings before interest, income taxes, depreciation and amortization, gain on disposal of property, plant, and equipment, and share based payments. Management uses this measurement to evaluate the operating results of the Company. This measure is also important to management since it is used by the Company's lenders to evaluate the ongoing cash generating capability of the Company and therefore the amounts those lenders are willing to lend to the Company. Investors find EBITDA to be useful information because it provides a measure of the Company's operating performance.

 

 

 

SOURCE Brick Brewing Co. Limited



Featured Video

Journalists and Bloggers

Visit PR Newswire for Journalists for releases, photos, ProfNet experts, and customized feeds just for Media.

View and download archived video content distributed by MultiVu on The Digital Center.

Share with Twitter Share with LinkedIn
 

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

 
 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

 
 

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.

 

Online Member Center

Not a Member?
Click Here to Join
Login
Search News Releases
Advanced Search
Search
  1. PR Newswire Services
  2. Knowledge Center
  3. Browse News Releases
  4. Contact PR Newswire
  5. Send a News Release