Business
Sun Gro Horticulture Income Fund Releases 2009 Third Quarter Results
Sun Gro Horticulture Income Fund Releases 2009 Third Quarter Results
About this update from Coloured Ties Capital Inc
[{"type":"text","content":"\n\n\n\nNov. 4, 2009 (Canada NewsWire Group) -- VANCOUVER, Nov. 4 /CNW/ -- Sun Gro Horticulture Income Fund (the Fund) today reported financial results for the three months ended September 30, 2009, which represents the third quarter of its 2009 fiscal year. The Fund's wholly-owned subsidiary, Sun Gro Horticulture Canada Ltd. (Sun Gro or the company) recorded operating income of $3.2 million, up from $0.8 million in the third quarter of 2008. Year-over-year, gross margin improved to 46% from 44% in 2008, while EBITDA was up by 31%. Net earnings for the quarter also improved markedly, swinging from a loss of $2.5 million in 2008 to a profit of $3.7 million this year.As in the first half of the year, the positive results were achieved despite lower sales volumes, largely due to the economic downturn. The performance improvement was driven by a combination of factors. These included the positive impact of a stronger US dollar on Sun Gro's primarily US dollar denominated revenues, the ongoing favourable effect of its 2008 productivity initiatives on operating costs, lower energy prices and transportation costs, and improved peat harvest conditions.\"Although the business environment has not notably improved, we have sustained our performance improvement trend and made a strong start to the seasonally slower second half of the year,\" said Mitch Weaver, President and CEO of Sun Gro and a Trustee of the Fund. \"We remain focused on reducing debt, driving greater operating efficiency by strengthening our infrastructure, and strategically growing our business. We are making good progress.\"Third Quarter Financial ResultsThird quarter revenues of $45.6 million were only slightly lower than the $45.9 million reported in 2008, despite an 8% decrease in overall sales volumes as measured in equivalent bales (EBs, referring to 10 cubic feet of product). US dollar product pricing remained stable, while the average value of the US dollar in relation to the Canadian dollar was up by 5% from the third quarter of 2008, offsetting much of the effect of the volume decline.Year-over-year, sales volumes were lower in all product categories except sand-based mixes. Volumes of peat and bark-based growing mixes decreased by 2% due to reduced sales of private label retail products. The lower retail volumes were partially offset by a modest increase in sal...