Achieves strong results in all key operating metrics; EBITDA* increase of 58.3%
CALGARY, Nov. 10, 2011 /CNW/ - Rocky Mountain Dealerships Inc. (TSX:RME) today reported financial results for the three and nine months ended September 30, 2011.
Third Quarter Highlights:
- Increased revenues by 25.5% to $213.9 million as compared to the same period in 2010.
- Increased gross profit as a percentage of sales to 16.5% from 15.3% in 2010.
- Generated Normalized Diluted Earnings per Share* of $0.35.
- EBITDA* increased by 58.3% to $12.0 million.
- Cash flow from Net Earnings* of $12.0 million, up from $5.9 million in 2010.
| * Non-IFRS measurements are defined and discussed further in the Management's Discussion and Analysis for the three and nine month periods ended September 30, 2011, which can be found at www.sedar.com. |
"Favorable commodity prices and harvesting conditions in Western Canada coupled with growth from our acquisitions helped drive stronger sales, which, in turn, improved our earnings over the prior year," said Rocky CEO Matt Campbell. "Our people worked hard to provide the equipment, parts and service that our customers needed in this period. Our company-wide commitment to being a reliable partner for our customers is the largest factor in this success."
"Although we have seen some positive signs from our Manitoba stores, the Manitoba region is still recovering from the flooding and wet weather that has impacted much of the province over the past two years."
"Construction market deliveries on a rolling 12 month basis have continued to improve. Manufacturer delivery delays did result in somewhat slowed growth for the third quarter, but at current production and demand levels, our short and mid-term outlooks for the construction market continue to be positive."
"Our focus during the quarter continued to be driving company efficiency and consistency throughout our large network. Stronger sales performance from our legacy stores combined with our deliberate pause in acquisitions, added strength to our balance sheet, including the net addition of $9.2 million of cash in the quarter."
Quarterly Cash Dividend
On November 9, 2011, Rocky's Board of Directors declared a dividend of $0.045 per common share on the Company's outstanding common shares. The common share dividend is payable on December 30, 2011 to shareholders of record at close of business on November 30, 2011.
This dividend is designated by Rocky to be an eligible dividend for the purposes of the Income Tax Act (Canada) and any similar provincial or territorial legislation. An enhanced dividend tax credit applies to eligible dividends paid to Canadian residents. Shareholders should consult their tax or financial advisor for further information regarding their specific tax concerns.
Conference Call
The Company will host a conference call to discuss its third quarter results on Thursday, November 10, 2011, at 9:00 a.m. Mountain Time. Investors interested in participating in the live call can dial 1-888-231-8191 (toll free) or 1-647-427-7450. An archived recording of the call will be available approximately two hours after its completion on Rocky's website or by calling 1-855-859-2056 (toll free) or 1-416-849-0833, passcode: 15956681. The archive will remain available until Thursday, November 24, 2011.
Caution regarding forward-looking statements
This news release may contain "forward-looking" statements within the meaning of applicable securities legislation which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Rocky or industry results, to be materially different from any future results, events, expectations, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements typically contain words or phrases such as "may", "outlook", "objective", "intend", "estimate", "anticipate", "should", "could", "would", "will", "expect", "believe", "plan" and other similar terminology suggesting future outcomes or events. Forward-looking statements involve numerous assumptions and should not be read as guarantees of future performance or results. Such statements will not necessarily be accurate indications of whether or not such future performance or results will be achieved. Readers should not unduly rely on forward-looking statements as a number of factors, many of which are beyond the control of Rocky, could cause actual performance or results to differ materially from the performance or results discussed in the forward-looking statements, including, but not limited to; general economic conditions; business cyclicality, construction outlook in both the short and medium term; relationships with manufacturers; access to products, reliance on key personnel and competition with existing business. Although the forward-looking statements contained in this news release are based upon what management of Rocky believes are reasonable assumptions, Rocky cannot assure investors that actual performance or results will be consistent with these forward-looking statements. These statements reflect current expectations regarding future events and operating performance and are based on information currently available to Rocky's management. There can be no assurance that the plans, intentions or expectations upon which these forward-looking statements are based will occur. All forward-looking statements in this news release are qualified in their entirety by the aforementioned cautionary statements and those set forth in Rocky's management's discussion and analysis for the three and nine months ended September 30, 2011 and Rocky's annual information form dated March 28, 2011 available on SEDAR at www.sedar.com. These forward-looking statements and outlook are made as of the date of this news release and, except as required by applicable law, Rocky assumes no obligation to update or revise them to reflect new events or circumstances.
About Rocky
Rocky is one of Canada's largest agriculture and construction equipment dealerships with 37 branches throughout Alberta, Saskatchewan and Manitoba. Rocky sells, rents, and leases new and used construction and agriculture equipment and offers product support, and finance to its customers.
Additional information on Rocky is available at www.rockymtn.com and on SEDAR at www.sedar.com.
Consolidated Balance Sheet Summary
Expressed in thousands of Canadian dollars except shares
outstanding(Unaudited)
|
September 30, 2011 |
December 31, 2010 |
September 30, 2010 |
|||||||||||||
| Current assets | 387,549 | 373,998 | 323,426 | ||||||||||||
| Property, plant and equipment | 22,205 | 20,600 | 20,280 | ||||||||||||
| Goodwill | 9,961 | 8,482 | 7,601 | ||||||||||||
| Total assets | 419,715 | 403,080 | 351,307 | ||||||||||||
| Current liabilities | 249,551 | 247,641 | 205,802 | ||||||||||||
| Long-term debt | 13,063 | 13,058 | 12,650 | ||||||||||||
| Obligations under finance leases | 1,770 | 1,387 | 1,308 | ||||||||||||
| Convertible debenture | 28,670 | 28,411 | 28,329 | ||||||||||||
| Deferred income taxes | 5,792 | 6,707 | 3,996 | ||||||||||||
| Derivative financial instruments | 972 | - | - | ||||||||||||
| Total liabilities | 299,818 | 297,204 | 252,085 | ||||||||||||
| Shareholders' equity | 119,897 | 105,876 | 99,222 | ||||||||||||
| Total liabilities and equity | 419,715 | 403,080 | 351,307 | ||||||||||||
| Shares outstanding | 18,768,399 | 18,427,250 | 18,332,849 | ||||||||||||
Selected Financial Information
Expressed in thousands of Canadian dollars except per share amounts and
percentages (Unaudited)
| For the three months ended September 30, | ||||||||||||||||||
|
2011 $ |
2010 $ |
Change $ |
Change % |
|||||||||||||||
| Sales | ||||||||||||||||||
| New equipment | 90,523 | 68,298 | 22,225 | 32.5 | ||||||||||||||
| Used equipment | 78,468 | 68,694 | 9,774 | 14.2 | ||||||||||||||
| Parts | 30,003 | 21,164 | 8,839 | 41.8 | ||||||||||||||
| Service | 13,807 | 11,184 | 2,623 | 23.5 | ||||||||||||||
| Other | 1,073 | 1,138 | (65) | (5.7) | ||||||||||||||
| Total sales | 213,874 | 170,478 | 43,396 | 25.5 | ||||||||||||||
| Cost of sales | 178,546 | 144,434 | 34,112 | 23.6 | ||||||||||||||
| Gross profit | 35,328 | 26,044 | 9,284 | 35.6 | ||||||||||||||
| Gross profit percentage | 16.5% | 15.3% | - | 1.2 | ||||||||||||||
| Expenses | ||||||||||||||||||
| Selling, general and administrative | 22,944 | 18,210 | 4,734 | 26.0 | ||||||||||||||
| Interest on short-term debt | 2,099 | 1,725 | 374 | 21.7 | ||||||||||||||
| Interest on long-term debt | 870 | 662 | 208 | 31.4 | ||||||||||||||
| Earnings from operations | 9,415 | 5,447 | 3,968 | 72.8 | ||||||||||||||
| Income taxes | 2,294 | 1,745 | 549 | 31.5 | ||||||||||||||
| Net earnings | 7,121 | 3,702 | 3,419 | 92.4 | ||||||||||||||
| Net earnings per share | ||||||||||||||||||
| Basic | 0.38 | 0.20 | 0.18 | 90.0 | ||||||||||||||
| Diluted | 0.34 | 0.20 | 0.14 | 70.0 | ||||||||||||||
| Dividends per share | 0.045 | 0.045 | - | - | ||||||||||||||
| EBITDA(*) | 11,996 | 7,578 | 4,418 | 58.3 | ||||||||||||||
| Operating SG&A (*) as % of sales | 9.9% | 9.9% | - | - | ||||||||||||||
(*) Non-IFRS measurements are defined and discussed further in the Management's Discussion and Analysis for the three and nine month periods ended September 30, 2011, which can be found at www.sedar.com.