Jewett-Cameron Announces 3rd Quarter Financial Results

NORTH PLAINS, Ore., July 11, 2012 /PRNewswire/ -- Jewett-Cameron Trading Company Ltd. (NASDAQ: JCTCF; TSX: JCT) today reported financial results for the third quarter and nine month periods of fiscal 2012 ended May 31, 2012.

Sales for the third quarter of fiscal 2012 totaled $16.11 million compared to sales of $12.91 million for the third quarter of fiscal 2011.  For the quarter, income from operations was $1,556,199 compared to $1,035,785 in the year-ago quarter. After other items and income taxes, the Company reported net income of $937,090, or $0.59 per basic and diluted share, compared to net income of $604,324, or $0.30 per share, in last year's third quarter.

For the nine months ended May 31, 2012, Jewett-Cameron reported sales of $35.10 million compared to sales of $30.85 million for the nine months ended May 31, 2011. Due to the favorable ruling from the Oregon Supreme Court regarding the Company's lawsuit filed in relation to the acquisition of inventory by Greenwood Products received in February 2012, the Company reversed $1,450,363 of its litigation reserve and accrued interest during the current nine month period. This contributed to the net income for the nine month period ended May 31, 2012 of $2,288,897, or $1.29 per share, compared to net income of $254,938, or $0.12 per share, in the prior year's period which was negatively affected by the Company accruing ($1,386,533) to the Litigation Reserve.

"Our continued focus of being a reliable and valuable supplier of quality products to our customers is reflected in our higher sales for both the quarter and nine month periods," said CEO Don Boone. "We have also successfully test marketed several new products, some of which have begun shipping to customers. However, high material and transportation costs continue to limit our margins."

As of May 31st, 2012, the Company's cash position was $4.64 million, and currently there is no borrowing against its $5.0 million line of credit. During the nine months ended May 31, 2012, the company repurchased and cancelled a total of 340,486 common shares at a total cost of $3,075,559, which represents an average cost of $9.03. On May 11, 2012, the Company announced the successful completion and early termination of its 10b5-1 share repurchase plan previously announced on January 17, 2012. As part of its ongoing consideration of alternative ways to leverage the Company's strong cash position, the Board of Directors is evaluating the implementation of another 10b5-1 share repurchase plan.

The Board of Directors is also evaluating the Company's dual listing status, and is considering dropping its Toronto Stock Exchange (TSX) listing.

About Jewett-Cameron Trading Company Ltd.

Jewett-Cameron Trading Company is a holding company that, through its subsidiaries, operates out of facilities located in North Plains, Oregon. Jewett-Cameron Lumber Corporation's business consists of the manufacturing and distribution of specialty metal products and wholesale distribution of wood products to home centers and other retailers located primarily in the United States. Greenwood Products is a processor and distributor of industrial wood and other specialty building products principally to customers in the marine and transportation industries in the United States. MSI-PRO is an importer and distributor of pneumatic air tools, industrial clamps, and the Avenger Products line of sawblades and other products.  Jewett-Cameron Seed Company is a processor and distributor of agricultural seeds.

Forward-looking Statements

The information in this release contains certain forward-looking statements that anticipate future trends and events.  These statements are based on certain assumptions that may prove to be erroneous and are subject to certain risks, including but not limited to, the uncertainties of the Company's new product introductions, the risks of increased competition and technological change in the Company's industry, and other factors detailed in the Company's SEC filings.  Accordingly, actual results may differ, possibly materially, from predictions contained herein.

JEWETT-CAMERON TRADING COMPANY LTD. 

CONSOLIDATED BALANCE SHEETS

(Expressed in U.S. Dollars)

(Prepared by Management)

(Unaudited)



May 31,

2012

August 31,

2011




ASSETS






Current assets



  Cash and cash equivalents

$   4,639,288

$    6,774,127

  Accounts receivable, net of allowance  of $2,852 (August 31, 2011 - $Nil)

5,173,954

3,897,086

  Inventory, net of allowance of $181,960 (August 31, 2011 - $204,860) (note 3)

4,998,450

5,815,593

  Note receivable

61,500

41,500

  Prepaid expenses

1,707,970

848,341

  Prepaid income taxes

-

682,527




  Total current assets

16,581,162

18,059,174




Property, plant and equipment, net (note 4)

1,758,584

1,850,037




Intangible assets, net (note 5)

464,707

510,771




Deferred income taxes (note 6)

155,810

157,862




Total assets

$  18,960,263

$  20,577,844




LIABILITIES AND STOCKHOLDERS' EQUITY






Current liabilities






  Accounts payable

$      677,042

$      519,265

  Litigation reserve (note 12(a))

177,552

1,627,915

  Accrued liabilities

1,199,343

941,846

  Accrued income taxes

204,170

-




  Total current liabilities

2,258,107

3,089,026







Contingent liabilities and commitments (note 12)






Stockholders' equity



  Capital stock (note 8)



     Authorized



      20,000,000 common shares, without par value



      10,000,000 preferred shares, without par value



    Issued



1,567,971 common shares (August 31, 2011 - 1,908,457)

1,479,721

1,801,043

  Additional paid-in capital

600,804

600,804

  Retained earnings

14,621,631

15,086,971




  Total stockholders' equity

16,702,156

17,488,818




  Total liabilities and stockholders' equity

$  18,960,263

$  20,577,844



 

 

JEWETT-CAMERON TRADING COMPANY LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Expressed in U.S. Dollars)

(Prepared by Management)

(Unaudited)



Three Month Periods to

May 31,


Nine Month Periods to

May 31,










2012


2011


2012


2011









SALES

$16,113,435


$12,913,331


$35,105,842


$30,858,396









COST OF SALES

13,306,308


10,483,142


28,741,219


24,856,594









GROSS PROFIT

2,807,127


2,430,189


6,364,623


6,001,802









OPERATING EXPENSES








  Selling, general and administrative expenses

233,947


399,226


1,122,892


1,297,627

  Depreciation and amortization

61,279


65,296


186,773


196,430

  Wages and employee benefits

955,702


929,882


2,663,388


2,637,929


1,250,928


1,394,404


3,973,053


4,131,986









Income from operations

1,556,199


1,035,785


2,391,570


1,869,816









OTHER ITEMS








   Loss on sale of property, plant and equipment

 

-


 

(6,988)


 

-


 

(2,652)

   Interest and other income

7,234


-


7,234


23

   Interest expense

(743)


(16,333)


(743)


(424,344)

   Litigation gain (loss) (Note 12(a))

-


-


1,443,629


(962,137)


6,491


(23,321)


1,450,120


(1,389,110)









Income before income taxes

1,562,690


1,012,464


3,841,690


480,706









Income taxes

625,600


408,140


1,552,793


225,768









Net income

$     937,090


$   604,324


$ 2,288,897


$    254,938









Basic earnings per common share

$           0.59


$         0.30


$          1.29


$          0.12









Diluted earnings per common share

$           0.59


$         0.30


$          1.29


$          0.12









Weighted average number of common shares outstanding:








  Basic

1,599,851


2,002,355


1,773,859


2,108,585

  Diluted

1,599,851


2,002,355


1,773,859


2,108,585


 

 

JEWETT-CAMERON TRADING COMPANY LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in U.S. Dollars)

(Prepared by Management)

(Unaudited)




Nine Month Periods

Ended May 31,






2012


2011





CASH FLOWS FROM OPERATING ACTIVITIES




Net income

$ 2,288,897


$  254,938

Items not involving an outlay of cash:




  Depreciation and amortization

186,773


196,430

  Loss on sale of property, plant and equipment

-


2,652

  Deferred income tax expense (recovery)

2,052


3,582

Changes in non-cash working capital items:




  (Increase) decrease in accounts receivable

(1,276,868)


(677,014)

  (Increase) decrease in inventory

817,143


(611,574)

  (Increase) in note receivable

(20,000)


-

  (Increase) decrease in prepaid expenses

(859,629)


(87,764)

  (Increase) decrease in prepaid income taxes

682,527


(647,530)

  Decrease in taxes receivable

-


-

  (Decrease) increase in accounts payable and

accrued liabilities

 

(1,035,089)


 

1,905,884

  (Decrease) increase in accrued income taxes

204,170


-

Net cash provided by operating activities

989,976


339,604





CASH FLOWS FROM INVESTING ACTIVITIES




  Purchase of property, plant and equipment

(36,206)


(61,122)

  Purchase of intangible assets and other

(13,050)



  Proceeds from sale of property, plant and equipment

-


5,450

Net cash used in investing activities

(49,256)


(55,672)





CASH FLOWS FROM FINANCING ACTIVITIES




Redemption of common stock

(3,075,559)


(3,361,970)

Net cash used in financing activities

(3,075,559)


(3,361,970)





Net increase (decrease) in cash and cash equivalents

(2,134,839)


(3,078,038)





Cash and cash equivalents, beginning of period

6,774,127


8,710,314





Cash and cash equivalents, end of period

$ 4,639,288


$ 5,632,276













Contact: Don Boone, President & CEO, (503) 647-0110

SOURCE Jewett-Cameron Trading Company Ltd.



RELATED LINKS
http://www.jewettcameron.com

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