MONTREAL, Feb. 21 /CNW Telbec/ - BMTC Group inc. announced that, for the year ended on December 31, 2007, its revenues totaled 841.5 million dollars, representing an increase of 5.8 million $ over the 835.7 million dollars for 2006. The Company's net income, for the period, totaled $49,033,000, or $1.54 per share, compared with $45,633,000, or $1.35 per share, for the corresponding 2006 period.
Results from the costing of options had the effect of reducing net earnings by $0.20 per share, compared to a reduction of $0.07 per share for the previous year. While the Company costs options as either an expense or revenue in the net earnings calculation, the Company believes it is preferable to inform readers of its financial statements of the impact of this element, which is outside the Company's control and which varies along with the course of the Company's share price in any given time period. An increase in the Company's share price incurs an expense, while a decrease in the Company's share price incurs revenue. Of particular concern is that the reader could be made to believe that the Company's profitability had risen in the context of a major decrease in the Company's share price. It is for this reason that the Company includes net earnings in absolute dollars and per-share dollars excluding this costing of options effect, even though doing so does not conform to GAAPs, it is therefore unlikely that we can compare them with the same type of measures presented by other issuers. It is worth noting that the Company is one of few public companies to expense options on an ongoing basis.
On December 31st 2007, given the volatility in the financial markets, management altered its way of estimating the cost of the Company's options, going from using the average stock price (weighted) during the 30 days preceding and following the close of the measured period to the market price at the close of the reporting period. This had the effect of increasing the cost of these options by $2 804 000 after taxes. In previous years, the method used by the Company; the 60-day weighted average, gave approximately the same results as the new method of market value at closing.
The sale of fixed assets resulted in an increase in net per share earnings of $0.06 compared with $0.01 for the corresponding period. The Superior Court of Quebec rendered a judgment against the Company's subsidiary Brault et Martineau, ordering it to pay punitive damages. The Company recorded a charge in the amount of $ 2,545,000 or $ 1,731,000 on an after-tax basis, representing the full amount of the award by the Superior Court and the Company's estimate of the ancillary distribution costs. This net amount represents a reduction of $0.05 to the net per share earnings for the year ended December 31st, 2007. The Company records its investments at market value. However, due to the liquidity issue with respect to ABCP, there is currently no market for the Company's ABCP investments. Therefore, a charge of $1,525,000 before tax or $1,288,000 after tax or $0.04 per share was recorded as a provision for the estimated lost in value. The share repurchase program contributed $0.08 to net per-share earnings. Excluding all these effects, net earnings would have increased by $8.8 million or $0.28 per share for 2007.
The adjusted $8.8 million increase in net earnings breaks down as follows:
2007 2006
($ in thousands, except
for per share amounts)
Net Earnings 49,033 45,633
Cost (gain) of options
(after-tax) 6,345 2,297
(Gain) resulting from the sale
of fixed assets (after-tax) (1,958) (254)
Provision for judgment (after-tax) 1,731 -
Provision for ABCP (after-tax) 1,288 -
------------ ------------
Adjusted Net Earnings 56,439 47,676
MINUS : Adjusted Net Earnings 2006 47,676
------------
Increase 2007 8,763
Annual Financial Information
2007 2006 2005
---- ---- ----
($ in thousands, except for per share amounts)
Revenue(x) $841,544 $835,681 $804,361
Net earnings 49,033 45,633 41,891
Total Assets 283,861 284,963 274,702
Net Earnings per share
Basic $1.54 $1.35 $1.20
Diluted 1.48 1.30 1.16
Dividends per share 0.29 0.24 0.13
(x)Following the changes in the interpretation of the accounting
principles in EIC-123 of the CICA entitled "Reporting Revenue Gross as a
Principal Versus Net as an Agent", the Company modified its presentation
of revenues from extended services contracts on certain products in order
to present them at the net amount obtained for the services rendered.
Consequently, the Company adjusted the results for the year ended
December 31st, 2005 by reducing operating revenues as well as the cost of
products sold, and commercial and administrative expenses in the amount
of $14,409,000. These changes had no impact on net earnings.
Quarterly Results (unaudited)
($ in thousands, except for per share amounts)
Quarter Ended Quarter Ended
March 31 June 30
2007 2006 2007 2006
---- ---- ---- ----
Revenue $178,452 $182,969 $216,109 $215,959
Net earnings 2,055 285 14,878 12,143
Net Earnings per share
Basic 0.060 0.010 0.460 0.350
Diluted 0.060 0.010 0.440 0.340
Quarter Ended Quarter Ended
September 30 December 31
2007 2006 2007 2006
---- ---- ---- ----
Revenue $223,355 $216,731 $223,628 $220,022
Net earnings 15,970 16,666 16,130 16,539
Net Earnings per share
Basic 0.500 0.490 0.520 0.500
Diluted 0.480 0.470 0.500 0.480
For the last quarter 2007, net earnings stood at $16,130,000 or $0.52 per
share, compared with $16,539,000 or $0.50 per share for the corresponding 2006
period.
The result from costing of options had the effect of reducing the earnings
per share by $0.01 compared to an increase of $0.01 for the corresponding
period. The Company records its investments at market value. However, due to
the liquidity issue with respect to ABCP, there is currently no market for the
Company's ABCP investments. Therefore, a charge of $1,525,000 before tax or
$1,288,000 after tax or $0.04 per share was recorded as a provision for the
estimated lost in value. The share repurchase program contributed $0.04 to net
per share earnings for the quarter ended December 31st, 2007. Excluding all
these effects, net earnings would have increased by 1,3 M$ or $0.04 per share
for the three-month period ended December 31st, 2007.
The adjusted 1,3 M$ in net earnings breaks down as follows for the
three-month period ended December 31st, 2007:
2007 2006
($ in thousands, except
for per share amounts)
Net Earnings 16,130 16,539
Cost (gain) of options
(after-tax) 129 (325)
(Gain) resulting from the sale
of fixed assets (after-tax) - -
Provision for ABCP (after-tax) 1,288 -
------------ ------------
Adjusted Net Earnings 17,547 16,214
MINUS : Adjusted Net Earnings 2006 16,214
------------
Increase 2007 1,333
Finally, BMTC Group inc. has indicated that in the course of its
redemption programs implemented in September 2007, and the conversion of Class
B Multiple Voting Shares, the Company has redeemed a total of 418,062 Class A
Subordinate Voting Shares with respect to which the average redemption price
was $21.48 per share, and 48,288 Class B Multiple Voting Shares with respect
to which the average redemption price was $20.29 per share, while 121,800
Class B Multiple Voting Shares were converted into as many Class A Subordinate
Voting Shares. As of February 21, 2008, 19,920,205 Class A Subordinate voting
shares and 10,915,595 Class B Multiple voting shares were outstanding.
BMTC Group inc., which Class A Subordinate Voting Shares are listed on the
Toronto Stock Exchange, is an important retailer of furniture, electronic
goods and household appliances in appliances in the areas of Montreal, Quebec
City, Repentigny, Ste-Therese, Laval, Longueuil, Kirkland, St-Georges,
Trois-Rivieres, Sherbrooke, Chicoutimi, Riviere-du-Loup, Rimouski, Levis,
Beauport, Ste-Foy, Gatineau, Ste-Hyacinthe, St-Jean-sur-le-Richelieu, Granby,
Vaudreuil, Mascouche and St-Jerome through its affiliates Brault & Martineau
and Ameublements Tanguay.