North West Company Financial Report Released

947
The Northern Store is one of the main options in many Northern Communities across Canada.
The Northern Store is one of the main options in many Northern Communities across Canada.
The Northern Store is one of the main options in many Northern Communities across Canada.
The Northern Store is one of the main options in many Northern Communities across Canada.

Northern Operations Down but Profitable

THUNDER BAY – BUSINESS – The North West Company Inc. (the “Company” or “North West”) reported the company’s unaudited financial results for the second quarter ended July 31, 2014. It also announced that the Board of Directors have declared a dividend of $0.29 per share to shareholders of record on September 30, 2014, to be paid on October 15, 2014.

“While International performance met expectations, our Canadian results were disappointing and reflect a more challenging competitive and consumer environment”, said President & CEO Edward Kennedy. “Our Top 40 Markets and Top Categories work progressed well in the quarter and will be a driving force to gaining profitable market share over the next 3 to 5 years.”

Financial Highlights

Sales increased 3.2% to $401.1 million compared to $388.6 million in the second quarter last year led by food sales growth and the impact of foreign exchange on the translation of U.S. denominated sales. Excluding the foreign exchange impact, sales increased 1.5% and were up 1.9%1 on a same store basis.

Food sales increased 1.9% and were up 2.1% on a same store basis and general merchandise sales1 decreased 0.5% due to lower sales in our wholesale operations but were up 1.0% on a same store basis.

Earnings from Operations decreased 6.0% to $26.3 million compared to $28.0 million in the second quarter last year. Gross profit dollars increased 1.3% driven by sales growth as the gross profit rate decreased 56 basis points compared to last year due to lower rates in the Canadian Operations.

Selling, operating and administrative expenses increased 3.6% compared to last year and were up 9 basis points as a percentage to sales. The increase in expenses is largely due to an insurance-related gain in the Canadian
Operations in the second quarter last year and the impact of foreign exchange on the translation of U.S. denominated expenses.

Excluding the impact of the insurance gain and the foreign exchange, earnings from operations increased 1.7% to last year.

Trading profit2 or earnings before interest, income taxes, depreciation and amortization (EBITDA) decreased 2.7% to $36.4 million compared to $37.4 million last year as strong trading profit growth in the International Operations was more than offset by lower trading profit in the Canadian Operations largely due to the non-comparable insurance gain last year and the impact of lower gross profit rates in the current year.

Excluding the impact of the non-comparable gain and the foreign exchange, trading profit increased 2.6% compared to last year and as a percentage to sales was 9.1% compared to 9.0% last year.

Second quarter net earnings decreased $1.3 million or 7.0% to $16.9 million and diluted earnings per share was $0.35 per share compared to $0.37 per share last year as lower net earnings in the Canadian Operations were only partially offset by an increase in earnings in the International Operations and the impact of foreign exchange. Excluding the impact of the non-comparable insurance gain and foreign exchange, net earnings increased 2.3% compared to last year.

Previous articleThunder Bay Police Conduct Major Drug Raid
Next articleWinston Churchill Took Genius and Words to Battle
NetNewsledger.com or NNL offers news, information, opinions and positive ideas for Thunder Bay, Ontario, Northwestern Ontario and the world. NNL covers a large region of Ontario, but are also widely read around the country and the world. To reach us by email: newsroom@netnewsledger.com Reach the Newsroom: (807) 355-1862