Goodfellow Reports Its Results for the Third Quarter Ended August 31, 2019

DELSON, Quebec, Oct. 04, 2019 (GLOBE NEWSWIRE) — Goodfellow Inc. (TSX: GDL) announced today its financial results for the third quarter ended August 31, 2019. The Company reported a net income of $2.5 million or $0.29 per share compared to a net income of $2.0 million or $0.23 per share a year ago.

Consolidated sales for the three months ended August 31, 2019 were $130.6 million compared to $132.5 million last year. Sales in Canada alone increased 3% compared to the same period a year ago. On the operating side, selling, administrative and general expenses decreased overall by $1.2 million.

For the nine months ended August 31, 2019, the Company reported a net income of $2.8 million or $0.33 per share compared to a net income of $2.4 million or $0.28 per share a year ago. Consolidated sales for the nine months ended August 31, 2019 were $342.5 million compared to $362.5 million last year. Sales in Canada decreased 4% compared to the same period a year ago. On the operating side, selling, administrative and general expenses decreased overall by $3.1 million.

“The encouraging results of the third quarter were negatively impacted particularly in the GTA & Southwestern Ontario. European political upheaval as well as the US/China trade war played havoc on the Company’s core hardwood export business. Goodfellow believes in its diversified offering to move forward successfully”.

Goodfellow Inc. is a distributor of lumber products, building materials and floor coverings. Goodfellow shares trade on the Toronto Stock Exchange under the symbol GDL.

GOODFELLOW INC.
Consolidated Statements of Comprehensive Income
For the three and nine months ended August 31, 2019 and 2018
(in thousands of dollars, except per share amounts)
Unaudited
	For the three months ended			For the nine months ended
	August 31 2019	August 31 2018		August 31 2019		August 31 2018
	$	$		$		$
Sales	130,594	132,455		342,460		362,465
Expenses
Cost of goods sold	106,840	108,072		278,088		295,438
Selling, administrative and general expenses	19,426	20,650		58,053		61,153
Loss (gain) on disposal of property, plant and equipment	–	(41	)	7		(2	)
Net financial costs	895	1,004		2,449		2,577
	127,161	129,685		338,597		359,166
Earnings before income taxes	3,433	2,770		3,863		3,299
Income taxes	961	777		1,086		925
Total comprehensive income	2,472	1,993		2,777		2,374
Net earnings per share – Basic	0.29	0.23		0.33		0.28
Net earnings per share – Diluted	0.29	0.23		0.32		0.28

GOODFELLOW INC.
Consolidated Statements of Financial Position
(in thousands of dollars)
Unaudited
	As at		As at		As at
	August 31 2019		November 30 2018		August 31 2018
	$		$		$
Assets
Current Assets
Cash	1,546		2,578		2,229
Trade and other receivables	65,216		50,008		65,154
Inventories	99,761		92,544		104,106
Prepaid expenses	2,552		3,143		4,151
Total Current Assets	169,075		148,273		175,640
Non-Current Assets
Property, plant and equipment	32,754		34,356		34,834
Intangible assets	3,990		4,444		4,588
Defined benefit plan asset	2,700		2,704		2,396
Investment in a joint venture	25		25		25
Other assets	849		916		849
Total Non-Current Assets	40,318		42,445		42,692
Total Assets	209,393		190,718		218,332
Liabilities
Current liabilities
Bank indebtedness	56,579		42,835		68,205
Trade and other payables	32,216		29,192		31,708
Income taxes payable	667		409		461
Provision	316		336		1,019
Current portion of long-term debt	15		14		45
Total Current Liabilities	89,793		72,786		101,438
Non-Current Liabilities
Provision	1,319		1,317		484
Long-term debt	32		43		46
Deferred income taxes	3,652		3,652		3,582
Defined benefit plan obligation	159		57		974
Total Non-Current Liabilities	5,162		5,069		5,086
Total Liabilities	94,955		77,855		106,524
Shareholders’ Equity
Share capital	9,152		9,152		9,152
Retained earnings	105,286		103,711		102,656
	114,438		112,863		111,808
Total Liabilities and Shareholders’ Equity	209,393		190,718		218,332

GOODFELLOW INC.
Consolidated Statements of Cash Flows
For the three and nine months ended August 31, 2019 and 2018
(in thousands of dollars)
Unaudited
	For the three months ended				For the nine months  ended
	August 31		August 31		August 31		August 31
	2019		2018		2019		2018
	$		$		$		$
Operating Activities
Net earnings	2,472		1,993		2,777		2,374
Adjustments for:
Depreciation	869		932		2,592		2,746
Accretion expense on provision	3		12		10		38
(Decrease) increase in provision	(28	)	55		(28	)	80
Income taxes	961		777		1,086		925
Loss (gain) on disposal of property, plant and equipment	–		(41	)	7		(2	)
Interest expense	603		737		1,708		1,866
Funding in deficit of pension plan expense	35		48		106		69
Other assets	–		–		67		33
	4,915		4,513		8,325		8,129
Changes in non-cash working capital items	6,126		10,863		(19,079	)	(21,668	)
Interest paid	(580	)	(663	)	(1,791	)	(2,005	)
Income taxes (paid) recovered	(152	)	1,296		(828	)	1,125
	5,394		11,496		(21,698	)	(22,548	)
Net Cash Flows from Operating Activities	10,309		16,009		(13,373	)	(14,419	)
Financing Activities
Net (decrease) increase in bank loans	(3,000	)	2,000		(1,000	)	(2,000	)
Net (decrease) increase in banker’s acceptances	(12,000	)	(16,000	)	13,000		14,000
Reimbursement of long-term debt	(4	)	(35	)	(10	)	(103	)
Dividend Paid	–		–		(851	)	–
	(15,004	)	(14,035	)	11,139		11,897
Investing Activities
Acquisition of property, plant and equipment	(263	)	(345	)	(488	)	(896	)
Increase in intangible assets	(17	)	(64	)	(62	)	(176	)
Proceeds on disposal of property, plant and equipment	–		(3	)	8		45
Dividends from the joint venture	–		260		–		260
	(280	)	(152	)	(542	)	(767	)
Net cash (outflow) inflow	(4,975	)	1,822		(2,776	)	(3,289	)
Cash position, beginning of period	2,942		(4,798	)	743		313
Cash position, end of period	(2,033	)	(2,976	)	(2,033	)	(2,976	)
Cash position is comprised of:
Cash	1,546		2,229		1,546		2,229
Bank overdraft	(3,579	)	(5,205	)	(3,579	)	(5,205	)
	(2,033	)	(2,976	)	(2,033	)	(2,976	)

GOODFELLOW INC.
Consolidated Statements of Change in Shareholders’ Equity
For the nine months ended August 31, 2019 and 2018
(in thousands of dollars)
Unaudited
	Share Capital	Retained Earnings		Total
	$	$		$
Balance as at November 30, 2017 (Audited)	9,152	100,282		109,434
Net income	–	2,374		2,374
Total comprehensive income	–	2,374		2,374
Balance as at August 31, 2018	9,152	102,656		111,808
Balance as at November 30, 2018 (Audited)	9,152	103,711		112,863
Net earnings	–	2,777		2,777
Total comprehensive income	–	2,777		2,777
Transactions within equity
Dividend	–	(851	)	(851	)
Modification of share-based payment	–	(351	)	(351	)
Balance as at August 31, 2019	9,152	105,286		114,438

From:	Goodfellow Inc.
	Patrick Goodfellow
	President and CEO
	Tel: 450 635-6511
	Fax: 450 635-3730
	Internet: [email protected]