Goodfellow Reports Its Results for the Third Quarter Ended August 31, 2023 and Declares Dividend
DELSON, Quebec, Oct. 04, 2023 (GLOBE NEWSWIRE) — Goodfellow Inc. (TSX: GDL) (the “Company” or “Goodfellow”) announced today its financial results for the third quarter of fiscal year 2023.
For the three months ended August 31, 2023, the Company reported net earnings of $6.2 million or $0.72 per share compared to net earnings of $10.6 million or $1.24 per share a year ago, while consolidated sales were $139.2 million compared to $167.6 million last year.
For the nine months ended August 31, 2023, the Company reported net earnings of $12.6 million or $1.47 per share compared to net earnings of $28.2 million or $3.30 per share a year ago, while consolidated sales were $387.4 million compared to $481.9 million last year.
In the third quarter of 2023, Goodfellow continued to experience the effects of deteriorating economic conditions on the forest products and building materials industry. As demand slowed, a surplus of inventory developed within the market which challenged growth and put downward pressure on prices. Despite these headwinds, Goodfellow focused on reconciliation and renewal of its inventories of diversified product categories, as well as leveraging its value-added capabilities to deliver a positive result for Q3.
The Board of Directors declared an eligible dividend of $0.50 per share payable on November 2, 2023 to shareholders of record at the close of business on October 19, 2023. This dividend is designated as an eligible dividend under the Income Tax Act (Canada). The declaration, timing, amount and payment of future dividends remain at the discretion of the Board of Directors.
About Goodfellow
Goodfellow is a diversified manufacturer of value-added lumber products, as well as a wholesale distributor of building materials and floor coverings. Goodfellow has a distribution footprint from coast-to-coast in Canada servicing commercial and residential sectors through lumber yard retailer networks, manufacturers, industrial and infrastructure project partners, and floor covering specialists. Goodfellow also leverages its value-added product capabilities to serve lumber markets internationally. Goodfellow Inc. is a publicly traded company, and its shares are listed on the Toronto Stock Exchange under the symbol “GDL”.
| GOODFELLOW INC. | ||||
| Consolidated Statements of Comprehensive Income | ||||
| For the three and nine months ended August 31, 2023 and 2022 | ||||
| (in thousands of dollars, except per share amounts) | ||||
| Unaudited | ||||
| For the three months ended | For the nine months ended | |||
| August 31 2023 | August 31 2022 | August 31 2023 | August 31 2022 | |
| $ | $ | $ | $ | |
| Sales | 139,155 | 167,574 | 387,406 | 481,886 |
| Expenses | ||||
| Cost of goods sold | 107,535 | 129,715 | 301,829 | 374,716 |
| Selling, administrative and general expenses | 22,220 | 22,126 | 66,143 | 65,464 |
| Net financial costs | 802 | 1,038 | 1,997 | 2,484 |
| 130,557 | 152,879 | 369,969 | 442,664 | |
| Earnings before income taxes | 8,598 | 14,695 | 17,437 | 39,222 |
| Income taxes | 2,407 | 4,115 | 4,882 | 10,983 |
| Total comprehensive income | 6,191 | 10,580 | 12,555 | 28,239 |
| Net earnings per share – Basic and Diluted | 0.72 | 1.24 | 1.47 | 3.30 |
| GOODFELLOW INC. | |||
| Consolidated Statements of Financial Position | |||
| (in thousands of dollars) | |||
| Unaudited | |||
| As at | As at | As at | |
| August 31 2023 | November 30 2022 | August 31 2022 | |
| $ | $ | $ | |
| Assets | |||
| Current Assets | |||
| Cash | 7,973 | 3,420 | 2,279 |
| Trade and other receivables | 66,235 | 64,423 | 76,201 |
| Income taxes receivable | 3,946 | 2,439 | 33 |
| Inventories | 113,346 | 112,294 | 142,082 |
| Prepaid expenses | 2,177 | 2,555 | 3,237 |
| Total Current Assets | 193,677 | 185,131 | 223,832 |
| Non-Current Assets | |||
| Property, plant and equipment | 32,906 | 32,269 | 31,148 |
| Intangible assets | 1,644 | 2,096 | 2,235 |
| Right-of-use assets | 11,697 | 14,999 | 14,614 |
| Defined benefit plan asset | 11,829 | 11,620 | 10,441 |
| Other assets | 777 | 802 | 802 |
| Total Non-Current Assets | 58,853 | 61,786 | 59,240 |
| Total Assets | 252,530 | 246,917 | 283,072 |
| Liabilities | |||
| Current Liabilities | |||
| Bank indebtedness | – | – | 31,590 |
| Trade and other payables | 37,551 | 36,286 | 42,744 |
| Provision | 2,253 | 2,281 | 370 |
| Current portion of lease liabilities | 4,863 | 4,969 | 4,836 |
| Total Current Liabilities | 44,667 | 43,536 | 79,540 |
| Non-Current Liabilities | |||
| Provision | 837 | 634 | 2,281 |
| Lease liabilities | 8,867 | 12,537 | 12,338 |
| Deferred income taxes | 3,431 | 3,431 | 3,151 |
| Total Non-Current Liabilities | 13,135 | 16,602 | 17,770 |
| Total Liabilities | 57,802 | 60,138 | 97,310 |
| Shareholders’ Equity | |||
| Share capital | 9,388 | 9,419 | 9,424 |
| Retained earnings | 185,340 | 177,360 | 176,338 |
| 194,728 | 186,779 | 185,762 | |
| Total Liabilities and Shareholders’ Equity | 252,530 | 246,917 | 283,072 |
| GOODFELLOW INC. | ||||||
| Consolidated Statements of Cash Flows | ||||||
| For the three and nine months ended August 31, 2023 and 2022 | ||||||
| (in thousands of dollars) | ||||||
| Unaudited | ||||||
| For the three months ended | For the nine months ended | |||||
| August 31 2023 | August 31 2022 | August 31 2023 | August 31 2022 | |||
| $ | $ | $ | $ | |||
| Operating Activities | ||||||
| Net earnings | 6,191 | 10,580 | 12,555 | 28,239 | ||
| Adjustments for: | ||||||
| Depreciation and amortization of: | ||||||
| Property, plant and equipment | 856 | 636 | 2,396 | 1,788 | ||
| Intangible assets | 151 | 153 | 452 | 455 | ||
| Right-of-use assets | 1,164 | 1,175 | 3,609 | 3,365 | ||
| Gain on disposal of property, plant and equipment | – | (10) | (181) | (45) | ||
| Accretion expense on provision | 68 | 25 | 204 | 76 | ||
| Provision | – | (34) | (29) | 428 | ||
| Income taxes | 2,407 | 4,115 | 4,882 | 10,983 | ||
| Interest expense | 341 | 508 | 910 | 1,007 | ||
| Interest on lease liabilities | 146 | 152 | 286 | 430 | ||
| Funding in excess of pension plan expense | (69) | (15) | (209) | (44) | ||
| Other | 152 | (13) | 13 | (38) | ||
| 11,407 | 17,272 | 24,888 | 46,644 | |||
| Changes in non-cash working capital items | 30,890 | 29,012 | (1,234) | (39,462) | ||
| Interest paid | (436) | (539) | (1,176) | (1,426) | ||
| Income taxes paid | (352) | (3,070) | (6,389) | (20,038) | ||
| 30,102 | 25,403 | (8,799) | (60,926) | |||
| Net Cash Flows from Operating Activities | 41,509 | 42,675 | 16,089 | (14,282) | ||
| Financing Activities | ||||||
| Net (decrease) increase in bank loans | – | (5,000) | – | 6,000 | ||
| Net (decrease) increase in banker’s acceptances | (28,000) | (35,000) | – | 18,000 | ||
| Payment of lease liabilities | (1,304) | (1,282) | (4,096) | (3,702) | ||
| Redemption of shares | (62) | – | (332) | – | ||
| Dividends paid | – | – | (4,274) | (3,425) | ||
| Net Cash Flows from Financing Activities | (29,366) | (41,282) | (8,702) | 16,873 | ||
| Investing Activities | ||||||
| Acquisition of property, plant and equipment | (1,357) | (1,002) | (3,040) | (2,914) | ||
| Increase in intangible assets | – | – | – | (40) | ||
| Proceeds on disposal of property, plant and equipment | – | 10 | 188 | 45 | ||
| Dividend from joint venture | 25 | – | 25 | – | ||
| Dissolution of the joint venture | (7) | – | (7) | – | ||
| Net Cash Flows from Investing Activities | (1,339) | (992) | (2,834) | (2,909) | ||
| Net cash inflow (outflow) | 10,804 | 401 | 4,553 | (318) | ||
| Cash position, beginning of period | (2,831) | (3,712) | 3,420 | (2,993) | ||
| Cash position, end of period | 7,973 | (3,311) | 7,973 | (3,311) | ||
| Cash position is comprised of: | ||||||
| Cash | 7,973 | 2,279 | 7,973 | 2,279 | ||
| Bank overdraft | – | (5,590) | – | (5,590) | ||
| 7,973 | (3,311) | 7,973 | (3,311) | |||
| GOODFELLOW INC. | |||
| Consolidated Statements of Changes in Shareholders’ Equity | |||
| For the nine months ended August 31, 2023 and 2022 | |||
| (in thousands of dollars) | |||
| Unaudited | |||
| Share Capital | Retained Earnings | Total | |
| $ | $ | $ | |
| Balance as at November 30, 2021 | 9,424 | 151,524 | 160,948 |
| Net earnings | – | 28,239 | 28,239 |
| Total comprehensive income | – | 28,239 | 28,239 |
| Dividend | – | (3,425) | (3,425) |
| Balance as at August 31, 2022 | 9,424 | 176,338 | 185,762 |
| Balance as at November 30, 2022 | 9,419 | 177,360 | 186,779 |
| Net earnings | – | 12,555 | 12,555 |
| Total comprehensive income | – | 12,555 | 12,555 |
| Dividend | – | (4,274) | (4,274) |
| Redemption of Shares | (31) | (301) | (332) |
| Balance as at August 31, 2023 | 9,388 | 185,340 | 194,728 |
| From: | Goodfellow Inc. |
| Patrick Goodfellow | |
| President and CEO | |
| T: 450 635-6511 | |
| F: 450 635-3730 | |
| info@goodfellowinc.com |
