Jewett-Cameron Announces 1st Quarter Financial Results
NORTH PLAINS, Ore., Jan. 16, 2018 /PRNewswire/ -- Jewett-Cameron Trading Company Ltd. (NASDAQ: JCTCF) today reported financial results for the first quarter of fiscal 2018 ended November 30, 2017.
Sales for the first quarter of fiscal 2018 totaled $9.4 million compared to sales of $10.4 million for the first quarter of fiscal 2017. Net income was $322,433, or $0.14 per share, compared to $485,920, or $0.21 per share, in the year-ago quarter.
During the current quarter, the Company was advised by a customer for whom we annually source and supply a "Black Friday" item that is not related to our core products that they had experienced returns due to breakage. Since it was a child's product, we jointly decided with the customer to immediately stop selling the product and take the added precaution of destroying all remaining inventory. In addition, we advised through direct email as well as public announcement that we were aware of a defect that may or may not be apparent on the products consumers had purchased, but that they could return the item to the retailer for refund. We also advised the Consumer Products Safety Commission of our voluntary actions and are awaiting further guidance. This entire incident applied to only one retail source and one product, but it caused significant impact on our first quarter results as we recognized the financial costs of this incident during the period. Based on our continuing analysis, we anticipate limited additional costs related to the issue.
As of November 30, 2017, the Company's cash position was approximately $5.6 million, and there was no borrowing against its $3.0 million line of credit. The Company has historically utilized its cash position by implementing share repurchase programs as an effective method of enhancing shareholder value, and the Board of Directors will consider implementing new share repurchase plans in the future.
Jewett-Cameron Trading Company is a holding company that, through its subsidiaries, operates out of facilities located in North Plains, Oregon. Jewett-Cameron Company's business consists of the manufacturing and distribution of patented and patent pending specialty metal products, wholesale distribution of wood products, seed processing and sales, and sales of industrial tools and clamps. The Company's brands include Lucky Dog, Animal House and AKC licensed products in the expanding pet market; fencing products under the Adjust-A-Gates, Fit-Right, Perimeter Patrol, and INFINITY Euro fence systems brands; Early Start, Spring Gardner, and Weatherguard for greenhouses; and TrueShade for patio umbrellas, furniture covers and canopies. Additional information about the Company and its products can be found the Company's website at www.jewettcameron.com.
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) | ||||
November 30, | August 31, | |||
ASSETS | ||||
Current assets | ||||
Cash | $ 5,560,066 | $ 5,912,250 | ||
Accounts receivable, net of allowance | 3,363,541 | 3,565,055 | ||
Inventory, net of allowance |
9,120,135 |
8,807,545 | ||
Prepaid expenses | 1,040,558 | 595,776 | ||
Total current assets | 19,084,300 | 18,880,626 | ||
Property, plant and equipment, net | 3,201,768 | 3,222,572 | ||
Intangible assets, net | 60,323 | 77,837 | ||
Deferred income taxes | 10,221 | - | ||
Total assets | $ 22,356,612 | $ 22,181,035 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
Current liabilities | ||||
Accounts payable | $ 544,736 | $ 638,128 | ||
Accrued liabilities | 1,765,072 | 1,807,192 | ||
Total current liabilities | 2,309,808 | 2,445,320 | ||
Deferred tax liability | - | 11,344 | ||
Total liabilities | 2,309,808 | 2,456,664 | ||
Stockholders' equity | ||||
Capital stock | ||||
Authorized | ||||
21,567,564 common shares, without par value | ||||
10,000,000 preferred shares, without par value | ||||
Issued | ||||
2,234,494 common shares (August 31, 2017 – 2,234,494) | 1,054,316 | 1,054,316 | ||
Additional paid-in capital | 600,804 | 600,804 | ||
Retained earnings | 18,391,684 | 18,069,251 | ||
Total stockholders' equity | 20,046,804 | 19,724,371 | ||
Total liabilities and stockholders' equity | $ 22,356,612 | $ 22,181,035 | ||
JEWETT-CAMERON TRADING COMPANY LTD. | |||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||
(Expressed in U.S. Dollars) | |||
(Prepared by Management) | |||
(Unaudited) | |||
Three Months Ended | |||
2017 | 2016 | ||
SALES | $ 9,413,970 | $ 10,421,804 | |
COST OF SALES | 7,227,222 | 8,027,362 | |
GROSS PROFIT | 2,186,748 | 2,394,442 | |
OPERATING EXPENSES | |||
Selling, general and administrative expenses | 445,877 | 551,048 | |
Depreciation and amortization | 72,665 | 68,640 | |
Wages and employee benefits | 1,097,904 | 982,249 | |
1,616,446 | 1,601,937 | ||
Income from operations | 570,302 | 792,505 | |
OTHER ITEMS | |||
Loss on sale of property, plant and equipment | (27,552) | - | |
Interest and other income | 2,690 | 1,820 | |
(24,862) | 1,820 | ||
Income before income taxes | 545,440 | 794,325 | |
Income tax expense | (223,007) | (308,405) | |
Net income | $ 322,433 | $ 485,920 | |
Basic earnings per common share | $ 0.14 | $ 0.21 | |
Diluted earnings per common share | $ 0.14 | $ 0.21 | |
Weighted average number of common shares outstanding: | |||
Basic | 2,234,494 | 2,286,294 | |
Diluted | 2,234,494 | 2,286,294 | |
JEWETT-CAMERON TRADING COMPANY LTD. | ||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
(Expressed in U.S. Dollars) | ||||
(Prepared by Management) | ||||
(Unaudited) | ||||
Three Months Ended | ||||
2017 | 2016 | |||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||
Net income | $ 322,433 | $ 485,920 | ||
Items not involving an outlay of cash: | ||||
Depreciation and amortization | 72,665 | 68,640 | ||
Loss on sale of property, plant and equipment | 27,552 | - | ||
Deferred income taxes | (21,565) | (3,165) | ||
Changes in non-cash working capital items: | ||||
Decrease (increase) in accounts receivable | 201,514 | (44,185) | ||
(Increase) decrease in inventory | (312,590) | 380,408 | ||
Decrease in prepaid income taxes | - | 596 | ||
(Increase) in prepaid expenses | (444,782) | (29,223) | ||
Decrease in accounts payable and accrued liabilities | (135,512) | (564,903) | ||
Increase in income taxes payable | - | 310,974 | ||
Net cash provided by (used by) operating activities | (290,285) | 605,062 | ||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||
Purchase of property, plant and equipment | (61,899) | (225,622) | ||
Net cash used in investing activities | (61,899) | (225,622) | ||
Net increase (decrease) in cash | (352,184) | 379,440 | ||
Cash, beginning of period | 5,912,250 | 4,519,922 | ||
Cash, end of period | $ 5,560,066 | $ 4,899,362 | ||
Contact: Charlie Hopewell, President & CEO, (503) 647-0110
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SOURCE Jewett-Cameron Trading Company Ltd.
