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Goodfellow Inc.: Goodfellow Reports its Results For Q1-2009

^{Published on 2008-12-19 12:30:31, Last Modified on 2008-12-19 12:31:46 - Market Wire}
 

DELSON, QUEBEC--(Marketwire - Dec. 19, 2008) - Goodfellow Inc. (TSX:GDL) announced today its financial results for the first quarter ended November 30, 2008. Consolidated sales of $110.9 million compared with $118.0 million a year ago. Net income decreased to $1.0 million or $0.12 per share compared to $1.9 million or $0.22 per share. The impact of the world financial crisis and the instability on the political scene created an extremely volatile business climate. The Canadian dollar was weak against USD during the last 2 months of the first quarter affecting gross margins but US sales were positively impacted. The foreign currency conversion effect on our US denominated sales resulted in positive impact of some $2.1 million in sales compared to last year. General expenses, selling and administrative costs for the first quarter ended November 30, 2008 decreased from $19.2 million last year to $18.6 million. The decrease reflects the focus on adjusting our operating costs to the slowdown. Reduction in yard labor staffing, a general salary freeze for all salaried employees, and many other measures have been taken to reduce our overhead costs.

"The First Quarter was a challenging one. Business conditions deteriorated rapidly in most markets and regions but we were able to maintain our profitability and position the company for the even more difficult months ahead" said Richard Goodfellow, President and Chief Executive Officer. "We continue to have a strong order file both on the industrial and dealer sides of our business and prospects for the spring remain cautiously optimistic. Staffing levels and cost control remain the continued areas of most attention."

Goodfellow Inc. is one of eastern Canada's largest independent re-manufacturers and distributors of lumber and hardwood flooring products. Goodfellow shares trade on the Toronto Stock Exchange under the symbol GDL.

GOODFELLOW INC.
STATEMENT OF INCOME
(in thousands of dollars except earnings per share)
(Unaudited)

 Three Months
 Ended November 30
 2008 2007
 $ $
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Sales 110,920 118,045
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Expenses
Cost of goods sold, selling, administrative
 and general expenses 108,541 114,158
Depreciation and amortization 518 552
Financial 363 534
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 109,422 115,244
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Income before income taxes 1,498 2,801
Income taxes 484 938
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Net income 1,014 1,863
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Earnings per share 0.12 0.22
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Earnings per share diluted 0.12 0.22
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GOODFELLOW INC.
CONDENSED BALANCE SHEET
(in thousands of dollars)
(Unaudited)

 As at November 30
 2008 2007
 $ $
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Current assets 134,468 134,902
Total assets 160,384 164,818
Current liabilities 56,546 63,546
Total liabilities 58,044 65,224
Shareholder's equity 102,340 99,594
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GOODFELLOW INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of dollars) Three Months
(unaudited) Ended November 30
 2008 2007
 $ $
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Operating activities
 Net income 1,014 1,863
 Items not affecting cash
 Depreciation and amortization 518 552
 Excess of expense over pension plan funding
 (pension plan funding over expense) (224) (215)
 Gain on disposal of assets (96) -
 Deferred income taxes - -
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 1,212 2,200

Changes in non-cash operating working capital balances
 Decrease (increase) in accounts receivable 19,438 24,435
 Decrease (increase) in inventories (21,037) (18,835)
 Decrease (increase) in prepaid expenses (2,046) 1,261
 Increase (decrease) in accounts payable (1,978) (1,575)
 Increase (decrease) in income taxes 138 (743)
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 (4,273) 6,744
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Financing activities
 Dividends (2,144) (3,005)
 Purchase of common shares (12) -
 Issuance of common shares - -
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 (2,156) (3,005)
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Investing activities
 Acquisition of fixed assets (566) (588)
 Disposal of fixed assets 151 -
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 (415) (588)
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Other comprehensive income - (119)
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Net cash inflow (outflow) (6,844) 3,032
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Cash and cash equivalents, beginning of period (21,079) (35,553)
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Cash and cash equivalents, end of period (27,923) (32,521)
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GOODFELLOW INC.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(in thousands of dollars)
(Unaudited)

 Three months
 Ended November 30
 2008 2007
 $ $
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Net income 1,014 1,863
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Other comprehensive income
 Net unrealized loss on available for sale
 financial assets, net of tax - -
 Net changes in cash flow hedges
 Foreign exchange re-evaluation - -
 Net gains on derivatives designated
 as cash flow hedges - -
 Reclassification to income - -
 Income taxes - -

 Cumulative translation adjustment:
 Net investments in self-sustaining foreign operations - (119)
 Net investments in fully integrated foreign operations - -
 Net gains (losses) on related hedging items,
 net of tax - -
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Total Other comprehensive income - (119)
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Total Comprehensive income 1,014 1,744
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