OAKVILLE, ON, Oct. 7 /CNW/ - Glendale International Corp. (TSX: GIN)
today reported sales of $37.4 million and net earnings of $0.3 million, or
$0.02 per share, for the third quarter of fiscal 2005, ended August 26, 2005.
"Against the backdrop of record gasoline prices and a strong Canadian
dollar, the Recreational Vehicles business continues to achieve pre-tax profit
margins that are among the best in the North American towable RV industry, the
result of our unique product lines and innovative option packages," said
Edward C. Hanna, Chief Executive Officer and Chairman, Glendale International
Corp. "During the third quarter, we launched our 2006 line-up, including the
redesigned Titanium MPRV. In our Electronics business, successful initiatives
to increase yields and lower costs at the Toronto facility contributed to
dramatically improved results versus the second quarter, while FTG Chatsworth
continued to perform well following its acquisition last year. Strong
performance in our Navigational Aids business during the quarter contributed
to year-to-date profitability that is well ahead of last year. The quarter was
also marked by several significant contract awards."
Financial Results
Sales for the third quarter of fiscal 2005 were $37.4 million compared
with $45.0 million for the third quarter of fiscal 2004, primarily due to
lower sales for the Recreational Vehicles business. Net earnings for the third
quarter of fiscal 2005 were $0.3 million, or $0.02 per share, compared with
$4.8 million, or $0.38 per share, for the third quarter of fiscal 2004.
Sales for the first nine months of fiscal 2005 were $123.8 million
compared with $141.1 million for the corresponding period of fiscal 2004. Net
earnings for the first nine months of fiscal 2005 were $2.1 million, or $0.17
per share, compared with $7.9 million or $0.63 per share for the first nine
months of fiscal 2004.
As of August 26, 2005, Glendale International had working capital of
$11.1 million, including cash and cash equivalents of $5.8 million, compared
to working capital of $10.9 million, including cash and cash equivalents of
$5.0 million, on November 30, 2004.
Recreational Vehicles (Glendale RV and Travelaire Canada)
Sales for the Recreational Vehicles business for the third quarter of
fiscal 2005 were $19.5 million compared with $25.6 million for the third
quarter of last year. The decline in sales is primarily attributable to the
currency translation impact of U.S. dollar denominated sales, increased price
competition due to the higher Canadian dollar and higher gasoline prices,
which impact the buying decisions of consumers. Operating earnings for the
third quarter of fiscal 2005 were $0.2 million compared with $2.1 million for
the same quarter last year.
During the quarter, the Recreational Vehicles business launched its 2006
product line, which includes a brand new version of its unique Titanium
Multi-Purpose Recreational Vehicle (MPRV). In addition to Glendale RV's patent
pending "Bug Room", the MPRV features a versatile cargo area large enough to
house a Smart Car and a redesigned rear door that folds down to become a ramp
for loading convenience. Other 2006 Titanium models feature revolutionary
kitchen designs that provide significantly more space than conventional
designs. Glendale RV also launched a new line of fifth wheel under the Easy
Rider-Golden Falcon banner.
Electronics (Firan Technology Group Corporation)
Performance of the Electronics business improved dramatically versus the
second quarter of this year, with pre-tax operating earnings increasing by 77%
resulting from substantially improved yields at FTG Circuits Toronto and the
continued strong performance of FTG Circuits Chatsworth. During the quarter,
FTG Circuits renewed its agreement with a major long-term customer for a
period of three years. The agreement is valued at $20 to $30 million over the
term of the agreement.
Sales for Firan Technology Group Corporation (TSX:FTG) for the third
quarter of fiscal 2005 were $13.2 million compared with $13.4 million for the
third quarter of fiscal 2004. The appreciation in the Canadian dollar reduced
the translated value of U.S.-denominated sales by approximately $1.0 million.
Sales for the Circuits Division increased to $11.0 million from $10.8 million,
with FTG Chatsworth contributing $3.3 million. Sales for the Aerospace
Division were $2.2 million compared to $2.6 million for the third quarter of
last year. Operating earnings for the third quarter of fiscal 2005 were
$0.4 million compared to $0.8 million for the third quarter of fiscal 2004. In
accordance with its ownership position in Firan Technology Group Corporation,
Glendale International recorded net earnings from the company for the third
quarter of fiscal 2005 of $0.1 million compared with net earnings of
$0.4 million for the third quarter of fiscal 2004.
Navigational Aids (Fernau Avionics)
Sales for Fernau Avionics for the third quarter of fiscal 2005 were
$4.2 million compared with $5.5 million for the third quarter of fiscal 2004.
The decrease was primarily the result of timing of contracts. Operating
earnings for the third quarter of fiscal 2005 were $0.4 million compared with
$0.6 million for the third quarter of fiscal 2004. Operating margins remained
strong due to the success of the revitalization of the existing product lines
last year, as well as reductions in input costs and improvements in
manufacturing efficiencies. For the year-to-date, profitability has improved
significantly with operating earnings increasing 37% compared to the same
period last year.
During the quarter, Fernau was awarded two major contracts to provide
traditional ground-based air navigation equipment. Executing on its strategy
to penetrate the U.S. market, Fernau secured a contract to provide TACANs and
DMEs to the U.S. Air Force Material Command (AFMC). The award is Fernau's
first major contract to supply ground-based air navigation equipment in the
U.S. In addition, Fernau secured a multi-million dollar contract with the
United Kingdom Ministry of Defence to supply Direction Finder Systems to the
Royal Navy and Royal Airforce. The systems will be installed at 14 sites in
the UK, Germany and the Falkland Islands.
Outlook
Mr. Hanna continued, "We are very proud of our 2006 RV line up. With some
of the most innovative features and options in the industry, our models
position us to be competitive in the challenging environment created by the
strong Canadian dollar and rising fuel costs, and over the long term as
favourable demographics drive the growth in the North American RV industry. In
addition to the acquisition of FTG Chatsworth, the Circuits division of our
Electronics business continues to strengthen as a result of yield improvements
and cost reductions, while the Aerospace division continues to benefit from
strong demand. Our Navigational Aids business remains well positioned for
continued growth supported by both the traditional ground-based air navigation
system business and new products such as the Personal Locator Beacon."
About Glendale International Corp.
Glendale International Corp. manages businesses that provide the
opportunity for superior long-term value creation through the application of
proven managerial expertise and innovative business strategies. The
Corporation has built a core portfolio of profitable growth businesses in the
recreational vehicles, electronics and technology sectors and will seek to
acquire complementary businesses that support its value-building proposition.
Glendale International's businesses include: Glendale Recreational
Vehicles/Travelaire Canada, the largest Canadian manufacturer of recreational
vehicles (RVs); A controlling position in Firan Technology Group Corporation,
the largest aerospace and defence supplier of advanced technology printed
circuits in Canada and among the top 25 PCB manufacturers in North America;
and Fernau Avionics, a leading international supplier of ground-based air
navigational systems for military, naval and civil aviation applications.
Glendale International Corp. is a public corporation whose shares trade
on the Toronto Stock Exchange ("TSX") under the symbol "GIN". The Corporation
has approximately 12.5 million common shares outstanding.
To reach Glendale International via the worldwide web logon to
www.glendaleint.com.
This press release contains certain forward-looking statements that
reflect the current views and/or expectations of management of Glendale
International Corp. with respect to its performance, business and future
events. Such statements are subject to a number of risks, uncertainties and
assumptions. Actual results and events may vary significantly.
<<
FINANCIAL HIGHLIGHTS
(in thousands of dollars except per share amounts)
(prepared without audit)
Three Months Ended Nine Months Ended
August 26, August 27, August 26, August 27,
2005 2004 2005 2004
Sales $37,374 $44,964 $123,815 $141,054
Net Earnings $282 $4,794 $2,145 $7,904
Basic and Diluted Net
Earnings per Share $0.02 $0.38 $0.17 $0.63
INTERIM CONSOLIDATED BALANCE SHEETS
(in thousands of dollars)
(prepared without audit)
As at
-------------------------------------
August 26, November 30, August 27,
2005 2004 2004
CURRENT ASSETS -------------------------------------
Cash and cash equivalents $5,793 $5,000 $3,816
Accounts receivable 19,971 19,375 23,614
Income taxes recoverable 288 - -
Inventories 20,941 17,621 18,411
Deposits and prepaid expenses 1,157 1,385 735
Future income taxes 1,913 1,609 1,007
-------------------------------------
50,063 44,990 47,583
Property, Plant and Equipment (net) 18,988 20,210 21,159
Intangible Asset 309 353 -
Goodwill 4,541 1,610 1,610
-------------------------------------
$73,901 $67,163 $70,352
-------------------------------------
-------------------------------------
CURRENT LIABILITIES
Bank indebtedness $8,279 $1,809 $6,493
Accounts payable and accrued
liabilities 18,190 22,324 22,658
Income taxes payable 711 701 261
Current portion of long-term debt 11,555 9,235 4,989
-------------------------------------
38,735 34,069 34,401
Long-Term Debt 2,420 2,994 3,259
Future Income Taxes 405 405 -
Non-Controlling Interest 8,011 6,452 6,467
-------------------------------------
49,571 43,920 44,127
SHAREHOLDERS' EQUITY
Share capital 1,249 1,249 1,249
Contributed surplus 8,896 7,960 7,961
Cumulative translation adjustment (518) 167 542
Retained earnings 14,703 13,867 16,473
-------------------------------------
24,330 23,243 26,225
-------------------------------------
$73,901 $67,163 $70,352
-------------------------------------
-------------------------------------
INTERIM CONSOLIDATED STATEMENTS OF EARNINGS
(in thousands of dollars except per share amounts)
(prepared without audit)
Three Months Ended Nine Months Ended
-----------------------------------------------
August 26, August 27, August 26, August 27,
2005 2004 2005 2004
-----------------------------------------------
Sales $37,374 $44,964 $123,815 $141,054
-----------------------------------------------
Costs and Expenses
Manufacturing, selling
and administration 35,057 40,502 115,404 128,122
Depreciation and
amortization 1,175 1,160 3,553 3,489
Research and development 460 615 1,415 1,457
-----------------------------------------------
36,692 42,277 120,372 133,068
-----------------------------------------------
Earnings Before Undernoted 682 2,687 3,443 7,986
-----------------------------------------------
Restructuring 7 - 7 (313)
Severance costs 385 - 661 1,200
-----------------------------------------------
Operating Earnings 290 2,687 2,775 7,099
Other Income (Expenses)
Interest income 86 10 153 45
Interest expense -
long-term (202) (117) (650) (371)
Interest expense -
short-term (194) (176) (349) (291)
Dilution gain - - 185 -
-----------------------------------------------
(310) (283) (661) (617)
(Loss)/Earnings Before
Income Taxes and
Non-Controlling Interest (20) 2,404 2,114 6,482
(Recovery of)/ Provision
for income taxes (368) (2,778) 559 (1,401)
-----------------------------------------------
Earnings Before
Non-Controlling Interest 348 5,182 1,555 7,883
Non-controlling interest (66) (388) 590 21
-----------------------------------------------
Net Earnings $282 $4,794 $2,145 $7,904
-----------------------------------------------
-----------------------------------------------
Basic and Diluted Net
Earnings per Share $0.02 $0.38 $0.17 $0.63
-----------------------------------------------
-----------------------------------------------
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of dollars)
(prepared without audit)
Three Months Ended Nine Months Ended
-----------------------------------------------
August 26, August 27, August 26, August 27,
2005 2004 2005 2004
-----------------------------------------------
Operating Activities
Net earnings $282 $4,794 $2,145 $7,904
Items not affecting cash
Depreciation and
amortization 1,175 1,160 3,553 3,489
Stock option expense 37 - 116 -
Future income taxes (322) (3,150) (323) (3,150)
Non-controlling interest 66 388 (590) (21)
Dilution gain - - (185) -
Gain on sale of
property, plant and
equipment - - - (313)
Changes in non-cash
operating working
capital 2,919 952 (5,834) (7,069)
-----------------------------------------------
4,157 4,144 (1,118) 840
Investing Activities
Acquisition of Young
Electronics - - (6,202) -
Purchase of capital
assets (348) (476) (1,869) (1,707)
Proceeds on sale of
property, plant and
equipment - - - 313
Other - - - (10)
-----------------------------------------------
(348) (476) (8,071) (1,404)
Financing Activities
Change in bank
indebtedness (2,161) (497) 6,469 3,321
Issuance of common shares
by FTGC - - 2,710 -
(Decrease)/Increase term
loan financing (115) 5,481 3,411 9,289
Repayment of long-term
debt and capital leases (647) (6,045) (1,649) (8,693)
Dividends paid (624) (1,249) (624) (1,249)
-----------------------------------------------
(3,547) (2,310) 10,317 2,668
Effect of exchange rate
changes on cash (330) 12 (335) 119
-----------------------------------------------
Change in cash and cash
equivalents (68) 1,370 793 2,223
Cash and Cash Equivalents,
beginning of period 5,861 2,446 5,000 1,593
-----------------------------------------------
Cash and Cash Equivalents,
end of period $5,793 $3,816 $5,793 $3,816
-----------------------------------------------
-----------------------------------------------
Supplemental disclosures
of cash flows:
Payments for interest 396 273 961 605
Payments for income taxes - 569 1,794 3,696
Refunds of income taxes 556 22 556 275
SEGMENTED INFORMATION (Three Months)
(in thousands of dollars)
(prepared without audit)
OPERATING SEGMENTS
-------------------------------------------------------
Recrea- Nav Aids Elec- Other Corporate Total
Three Months Ended tional tronics Office
August 26, 2005 Vehicles
-------------------------------------------------------
Sales $19,498 $4,166 $13,218 $492 - $37,374
Costs and expenses 19,321 3,739 12,428 512 692 36,692
-------------------------------------------------------
Earnings before
undernoted 177 427 790 (20) (692) 682
Severance and
restructuring
costs - - 392 - - 392
-------------------------------------------------------
Operating earnings 177 427 398 (20) (692) 290
Interest income - 47 - - 39 86
Interest expense -
long term - 20 (106) - (116) (202)
Interest expense -
short term - - - - (194) (194)
Income tax recovery - 261 (174) - 281 368
Non-controlling
interest - - (66) - - (66)
-------------------------------------------------------
Net earnings $177 $755 $52 ($20) ($682) $282
-------------------------------------------------------
-------------------------------------------------------
Total and
identifiable
assets 20,204 16,821 21,733 616 14,527 73,901
Capital expenditures 28 88 201 12 19 348
Depreciation and
amortization 131 64 894 11 75 1,175
Goodwill - - 4,541 - - 4,541
Three Months Ended
August 27, 2004
Sales $25,586 $5,466 $13,361 $551 - $44,964
Costs and expenses 23,453 4,893 12,532 567 832 42,277
-------------------------------------------------------
Operating earnings 2,133 573 829 (16) (832) 2,687
Interest income - 10 - - - 10
Interest expense -
long term - - (70) - (47) (117)
Interest expense -
short term - - - - (176) (176)
Income tax recovery - - - - 2,778 2,778
Non-controlling
interest - - (388) - - (388)
-------------------------------------------------------
Net earnings $2,133 $583 $371 ($16) $1,723 $4,794
-------------------------------------------------------
-------------------------------------------------------
Total and
identifiable
assets 20,170 16,170 19,926 634 13,452 70,352
Capital expenditures 35 10 351 15 65 476
Depreciation and
amortization 124 54 886 16 80 1,160
Goodwill - - 1,610 - - 1,610
SEGMENTED INFORMATION (Nine Months)
(in thousands of dollars)
(prepared without audit)
OPERATING SEGMENTS
-------------------------------------------------------
Recrea- Nav Aids Elec- Other Corporate Total
Nine Months Ended tional tronics Office
August 26, 2005 Vehicles
-------------------------------------------------------
Sales $69,163 $13,734 $39,411 $1,507 - $123,815
Costs and expenses 65,361 12,049 38,866 1,566 2,530 120,372
-------------------------------------------------------
Earnings before
undernoted 3,802 1,685 545 (59) (2,530) 3,443
Severance and
restructuring
costs - - 668 - - 668
-------------------------------------------------------
Operating earnings 3,802 1,685 (123) (59) (2,530) 2,775
Interest income - 113 - - 40 153
Interest expense -
long term - 60 (350) - (360) (650)
Interest expense -
short term - - - - (349) (349)
Dilution gain - - 185 - - 185
Income tax provision - 205 (573) - (191) (559)
Non-controlling
interest - - 590 - - 590
-------------------------------------------------------
Net earnings $3,802 $2,063 ($271) ($59) ($3,390) $2,145
-------------------------------------------------------
-------------------------------------------------------
Total and
identifiable
assets 20,204 16,821 21,733 616 14,527 73,901
Capital expenditures 703 168 940 20 38 1,869
Depreciation and
amortization 395 195 2,696 38 229 3,553
Goodwill - - 4,541 - - 4,541
Nine Months Ended
August 27, 2004
Sales $88,559 $14,476 $36,177 $1,842 - $141,054
Costs and expenses 79,832 13,249 35,246 1,730 3,011 133,068
-------------------------------------------------------
Earnings before
undernoted 8,727 1,227 931 112 (3,011) 7,986
Restructuring
recovery - - (313) - - (313)
Severance costs - - 1,200 - - 1,200
-------------------------------------------------------
Operating earnings 8,727 1,227 44 112 (3,011) 7,099
Interest income - 21 - - 24 45
Interest expense -
long term - - (206) - (165) (371)
Interest expense -
short term - - - - (291) (291)
Income tax recovery - (3) 120 - 1,284 1,401
Non-controlling
interest - - 21 - - 21
-------------------------------------------------------
Net earnings $8,727 $1,245 ($21) $112 ($2,159) $7,904
-------------------------------------------------------
-------------------------------------------------------
Total and
identifiable
assets 20,170 16,170 19,926 634 13,452 70,352
Capital expenditures 166 459 857 21 204 1,707
Depreciation and
amortization 369 165 2,661 49 245 3,489
Goodwill - - 1,610 - - 1,610
>>
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