Toronto Stock Exchange Symbol: GIN
OAKVILLE, ON, April 17 /CNW/ - Glendale International Corp. (TSX: GIN)
today reported financial results for the first quarter of fiscal 2006 ended
March 3, 2006.
"We had an encouraging first quarter with positive highlights in each of
our businesses," said Edward C. Hanna, Chief Executive Officer and Chairman,
Glendale International Corp. "In our Recreational Vehicles business, we saw
the first quarter-over-quarter sales growth in over two years as our 2006
model line and strong demand in Western Canada for specialty trailers
contributed to sales growth of 3.6% for the quarter, despite the challenges
inherent in the stronger Canadian dollar. Our Electronics business posted
strong growth in sales and operating earnings with solid contributions from
both their Circuits division and their Aerospace division. And, prior to the
conversion to Canadian dollars, our U.K.-based Navigational Aids business
posted sales growth of 1.1% and growth in operating earnings of 6.7%, while
receiving its first production order from the U.S. Air Force for Tactical Air
Navigation beacons."
Financial Results
Sales for the first quarter of fiscal 2006 increased 4.2% to
$38.6 million compared with $37.0 million for the first quarter of last year.
Sales growth in the Recreational Vehicles business and the Electronics
business was partially offset by lower sales in the Navigational Aids business
due to the stronger Canadian dollar. Net earnings for the first quarter of
fiscal 2006 increased 329.8% to $0.8 million, or $0.06 per share, compared
with $0.2 million, or $0.01 per share, for the first quarter of fiscal 2005.
As of March 3, 2006, Glendale International had working capital of
$10.1 million, including cash and cash equivalents of $1.0 million, compared
to working capital of $9.2 million, including cash and cash equivalents of
$6.2 million, on November 30, 2005.
Recreational Vehicles (Glendale RV and Travelaire Canada)
Sales for the Recreational Vehicles business for the quarter increased
3.6% to $21.4 million from $20.6 million for the first quarter of last year.
The Recreational Vehicles business benefited from a strong Albertan economy,
and in particular, sales of specialty trailers were positively affected by the
booming oil sands industry. Operating earnings for the first quarter decreased
13.8% to $0.9 million compared with $1.0 million for the same period last
year. The decrease in operating earnings was the result in differences in
sales mix from one period to another, partially attributable to the business
expanding its mid-priced product offering. Results continued to be impacted by
the appreciation of the Canadian dollar, having the effect of lowering U.S.
dollar denominated sales, and making Canadian manufactured RVs comparatively
more expensive than those of U.S. rivals.
Electronics (Firan Technology Group Corporation)
Sales for Firan Technology Group Corporation (TSX: FTG) for the quarter
increased 11.1% to $13.4 million from $12.0 million for the same period last
year. The increase was primarily attributable to strong performance from the
Circuits division, which posted sales growth of 11.6% for the quarter, driven
by increased volumes and improved production yields. The Aerospace division
posted sales growth of 8.4%, resulting from higher Quick Turn activity and
increased shipments to key customers. The stronger Canadian dollar reduced the
translated value of U.S.-denominated sales by $0.7 million. Operating earnings
for the quarter were $0.3 million compared with an operating loss of
$0.8 million for the first quarter of fiscal 2005. In accordance with its
ownership position in Firan Technology Group Corporation, Glendale
International recorded net earnings from the company for the first quarter of
fiscal 2006 of less than $0.1 million, compared with a net loss of
$0.3 million for the first quarter last year.
Navigational Aids (Fernau Avionics)
Sales for Fernau Avionics for the quarter decreased 11.5% to $3.9 million
from $4.4 million for the same period last year. Operating earnings for the
quarter decreased 6.4% to $0.5 million compared with $0.6 million for the
first quarter of fiscal 2005. When adjusted for the effect of the stronger
Canadian dollar, sales for the quarter increased 1.1% and operating earnings
increased by 6.7%. During the quarter, in addition to receiving its first
production order from the U.S. Air Force for TACANs (Tactical Air Navigation
beacons), Fernau received a multi-million dollar order from Italian-based
Selex Sensors and Airborne Systems for Mode-S radar transmitters, as well as
orders from Columbia, Denmark, Georgia, and Spain, for distance measuring
equipment.
Other (Quality Plastics)
During the first quarter, management determined that it would close its
plastics business unit, included in the "Other" operating segment, by March
30, 2006. At March 3, 2006, the Corporation's plastics business unit was
classified as discontinued operations and their results of operations,
financial position and cash flows in the quarterly financial statements are
separately reported. The Corporation recorded a $360,000 accrual in the first
quarter of 2006 in connection with the discontinued operation. The accrual
includes costs for severance, retiring allowance and other costs. The costs as
a result of severances and the retiring allowance are expected to be paid in
the second quarter of 2006. The amount of the accrual at March 3, 2006 is
$360,000.
Outlook
"We are pleased by what we see as a potential turnaround in our core
Recreational Vehicles business," said Mr. Hanna. "In our RV business, we
continue to execute a focused strategy with specific attention to innovation,
differentiation, and targeting cost reduction, to achieve long-term growth.
With Glendale RV's entrance into the mid-priced segment of the RV market we
hope to capture more of the price-sensitive market, while our park models
target a growth market that is essentially bullet-proof to U.S. competition
and to the impact of rising fuel prices. Our Electronics business is seeing
increased opportunities from existing and new customers, and is well-
positioned to capitalize on the robust aerospace and defence markets. With a
strong order book, our Navigational Aids business looks to further penetrate
the lucrative North American market, and has tremendous potential to secure
additional major contracts."
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 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 core business, Glendale Recreational
Vehicles/Travelaire Canada, is the largest Canadian manufacturer of
recreational vehicles. The Corporation also owns a controlling position in
Firan Technology Group Corporation, the largest aerospace and defence supplier
of advanced technology printed circuits (PCBs) in Canada and among the top 25
PCB manufacturers in North America, 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
March 3, February 25,
2006 2005
-------------------------------------------------------------------------
Sales $ 38,617 $ 37,048
Net Earnings from Continuing Operations $ 1,009 $ 213
Net Loss from Discontinued Operation (231) (32)
-------------------------
Net Earnings $ 778 $ 181
-------------------------
-------------------------------------------------------------------------
Basic and Diluted Net Earnings per Share
from Continuing Operations $ 0.08 $ 0.02
Basic and Diluted Net Earnings per Share $ 0.06 $ 0.01
-------------------------------------------------------------------------
INTERIM CONSOLIDATED STATEMENTS OF EARNINGS
(in thousands of dollars except per share amounts)
(prepared without audit)
Three Months Ended
-------------------------
March 3, February 25,
-------------------------
2006 2005
-------------------------
Sales $ 38,617 $ 37,048
Costs and Expenses
Manufacturing, selling and administration 35,933 35,433
Gain on sale of property, plant and equipment (6) -
Depreciation and amortization 1,023 1,185
Research and development 359 430
-------------------------
37,309 37,048
-------------------------
Earnings Before Undernoted 1,308 -
-------------------------
Restructuring and severance costs - 276
-------------------------
Operating Earnings/(Loss) 1,308 (276)
Other Income (Expenses)
Interest income 66 23
Interest expense - long term (171) (222)
Interest expense - short term (191) (29)
Dilution gain - 185
-------------------------
(296) (43)
Earnings/(Loss) Before Income Taxes,
Non Controlling Interest and
Discontinued Operation $ 1,012 ($319)
(Recovery of)/Provision for income taxes (97) 21
-------------------------
Earnings/(Loss) Before Non-Controlling
Interest and Discontinued Operation $ 1,109 ($340)
Non-controlling interest (100) 553
-------------------------
Earnings from Continuing Operations $ 1,009 $ 213
Loss from discontinued operation 231 32
-------------------------
Net Earnings $ 778 $ 181
-------------------------
-------------------------
Basic and Diluted Net Earnings per Share
from Continuing Operations $ 0.08 $ 0.02
-------------------------
-------------------------
Basic and Diluted Net Earnings per Share $ 0.06 $ 0.01
-------------------------
-------------------------
INTERIM CONSOLIDATED BALANCE SHEETS
(in thousands of dollars)
(prepared without audit)
As At
-------------------------------------
CURRENT ASSETS March 3, November 30, February 25,
2006 2005 2005
-------------------------------------
Cash and cash equivalents $1,035 $6,208 $4,542
Accounts receivable 24,420 20,616 23,552
Income taxes recoverable 196 - 948
Inventories 25,101 21,582 22,935
Deposits and prepaid expenses 1,171 885 1,238
Future income taxes 1,283 1,088 1,626
Current assets of discontinued
operation 467 689 422
-------------------------------------
53,673 51,068 55,263
Future Income Taxes 564 564 -
Property, Plant and Equipment (net) 15,669 15,796 20,190
Note Receivable 1,967 1,967 -
Intangible Asset 269 281 361
Goodwill 4,876 4,876 4,541
Long Term Assets of Discontinued
Operation 188 198 216
-------------------------------------
$77,206 $74,750 $80,571
-------------------------------------
-------------------------------------
CURRENT LIABILITIES
Bank indebtedness $10,177 $6,506 $10,021
Accounts payable and accrued
liabilities 23,342 23,436 21,888
Income taxes payable 33 200 211
Current portion of long-term debt 9,474 11,520 10,011
Current liabilities of
discontinued operation 531 177 282
-------------------------------------
43,557 41,839 42,413
Long-Term Debt - - 5,440
Future Income Taxes 49 49 437
Non-Controlling Interest 8,196 8,096 8,047
-------------------------------------
51,802 49,984 56,337
SHAREHOLDERS' EQUITY
Share capital 1,249 1,249 1,249
Contributed surplus 8,971 8,923 8,840
Cumulative translation adjustment (1,583) (1,395) 782
Retained earnings 16,767 15,989 13,363
------------------------------------
25,404 24,766 24,234
-------------------------------------
$77,206 $74,750 $80,571
-------------------------------------
-------------------------------------
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of dollars)
(prepared without audit)
Three Months Ended
-------------------------
March 3, Feb 25,
2006 2005
-------------------------
Continuing Operating Activities
Net earnings from continuing operations $ 1,009 $ 213
Items not affecting cash
Depreciation and amortization 1,023 1,185
Stock option expense 48 48
Future income taxes (204) 31
Non-controlling interest 100 (553)
Dilution gain - (185)
Gain on sale of property,
plant and equipment (6) -
Changes in non-cash operating
working capital (8,293) (8,928)
-------------------------
(6,323) (8,189)
Discontinued operation 344 301
Investing Activities
Acquisition of Young Electronics - (6,202)
Purchase of capital assets (906) (894)
-------------------------
(906) (7,096)
Discontinued operation - (4)
Financing Activities
Increase in bank indebtedness 3,671 8,212
Issuance of common shares by FTG - 2,723
New term loan financing - 3,526
Repayment of long-term debt and
capital leases (1,971) (128)
-------------------------
1,700 14,333
Effect of exchange rate changes on cash 12 197
-------------------------
Decrease in cash and cash equivalents (5,173) (458)
Net Cash and Cash Equivalents,
Beginning of Period 6,208 5,000
-------------------------
Net Cash and Cash Equivalents, End of Period $ 1,035 $ 4,542
-------------------------
-------------------------
Supplemental disclosures of cash flows:
Payments for interest $ 363 $ 252
Payments for income taxes $ 343 $ 1,570
Refunds for income taxes $ 14 $ -
SEGMENTED INFORMATION
(in thousands of dollars)
(prepared without audit)
OPERATING SEGMENTS
------------------------------------------------------
Recrea- Corpo-
Three Months Ended tional Nav Elec- rate
March 3, 2006 Vehicles Aids tronics Other Office Total
------------------------------------------------------
Sales $21,377 $3,877 $13,363 - - $38,617
Costs and expenses 20,477 3,351 13,047 - 434 37,309
------------------------------------------------------
Operating earnings 900 526 316 - (434) 1,308
Interest income - 36 - - 30 66
Interest expense -
long term - 18 (105) - (84) (171)
Interest expense -
short term - - - - (191) (191)
Income tax recovery - 207 (33) - (77) 97
Non-controlling
interest - - (100) - - (100)
------------------------------------------------------
Earnings from
continuing
operations 900 787 78 - (756) 1,009
Loss from
discontinued
operation - - - 231 - 231
------------------------------------------------------
Net earnings $900 $787 $78 ($231) ($756) $778
------------------------------------------------------
------------------------------------------------------
Total and
identifiable assets 28,297 16,529 19,882 655 11,843 77,206
Capital expenditures 43 14 832 - 17 906
Depreciation and
amortization 136 62 800 - 25 1,023
Goodwill - - 4,876 - - 4,876
Three Months Ended
February 25, 2005
Sales $20,637 $4,380 $12,031 - - $37,048
Costs and expenses 19,593 3,818 12,568 - 1,069 37,048
------------------------------------------------------
Earnings before
undernoted 1,044 562 (537) - (1,069) -
Severance costs - - 276 - - 276
------------------------------------------------------
Operating loss 1,044 562 (813) - (1,069) (276)
Interest income - 21 - - 2 23
Interest expense -
long term - 19 (118) - (123) (222)
Interest expense -
short term - - - - (29) (29)
Dilution gain - - 185 - - 185
Income tax provision - - (83) - 62 (21)
Non-controlling
interest - - 553 - - 553
------------------------------------------------------
Earnings from
continuing
operations 1,044 602 (276) - (1,157) 213
Loss from
discontinued
operation - - - 32 - 32
------------------------------------------------------
Net earnings $1,044 $602 ($276) ($32) ($1,157) $181
------------------------------------------------------
------------------------------------------------------
Total and
identifiable
assets 25,656 16,284 23,337 638 14,656 80,571
Capital
expenditures 494 25 359 - 16 894
Depreciation and
amortization 130 63 914 - 78 1,185
Goodwill - - 4,541 - - 4,541
>>
Glendale International reports first quarter results
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