NORTH PLAINS, OR - Jewett-Cameron Trading Company Ltd. (NASDAQ: JCTCF) today reported financial results for its fourth quarter and fiscal year ended August 31, 2014.

For the fiscal year ended August 31, 2014 Jewett-Cameron reported net income after other items and income taxes of $1,858,453, or $0.63 per diluted share, on sales of $42.34 million, compared to net income of $3,132,019, or $1.00 per diluted share, on sales of $49.29 million, reported for fiscal 2013. The net income for fiscal 2013 was positively affected by a one-time gain on the sale of property of $353,852. Excluding other items and taxes, income from operations was $3,084,598 in fiscal 2014 compared to $4,673,690 in fiscal 2013.

Sales for the fourth quarter of fiscal 2014 totaled $9.3 million compared to sales of $10.7 million for the fourth quarter of fiscal 2013. Net income was $352,147, or $0.12 per diluted share, compared to net income of $842,078, or $0.27 per diluted share, in the fourth quarter of fiscal 2013. All per share amounts have been adjusted for the 2 for 1 stock split of the common shares effective May 2, 2013.

"The decline in sales and operating income is a result of increased competitiveness in several of our markets, as well as higher raw material prices which have lowered our product margins," said CEO Don Boone. "In response to these issues, we have initiated several programs to expand our business, including broadening our sales efforts to new customers and categories, and the introduction of several new products."

As of August 31, 2014, the Company's cash position was $4.3 million, and currently there is no borrowing against its $1.0 million line of credit, which we voluntarily reduced from $5.0 million in March 2014. During fiscal 2014, the Company repurchased and cancelled a total of 430,306 common shares at a total cost of $4,257,768, which represents an average price of $9.89 per share. On April 14, 2014, the Company commenced a new Rule 10b-18 share repurchase plan for cancellation of up to 300,000 common shares through the facilities of NASDAQ. Through October 29, 2014, the Company has repurchased a total of 132,923 common shares at a cost of $1,363,138, which is an average price of $10.26. The current plan is scheduled to terminate on November 14, 2014, but may be limited or terminated at any time without prior notice.

About Jewett-Cameron Trading Company Ltd.

Jewett-Cameron Trading Company Ltd. was incorporated in British Columbia on July 8, 1987 as a holding company for Jewett-Cameron Lumber Corporation ("JCLC"), incorporated September 1953. Jewett-Cameron Trading Company, Ltd. acquired all the shares of JCLC through a stock-for-stock exchange on July 13, 1987, and at that time JCLC became a wholly owned subsidiary. Effective September 1, 2013, Jewett-Cameron reorganized certain of its subsidiaries. JCLC's name was changed to JC USA Inc. ("JC USA"), and a new subsidiary, Jewett-Cameron Company ("JCC"), was incorporated. JC USA has the following wholly owned subsidiaries: MSI-PRO Co. ("MSI"), incorporated April 1996, Jewett-Cameron Seed Company, ("JCSC"), incorporated October 2000, Greenwood Products, Inc. ("Greenwood"), incorporated February 2002, and Jewett-Cameron Company ("JCC"), incorporated September 2013. Jewett-Cameron Trading Company, Ltd. and its subsidiaries (the "Company") have no significant assets in Canada.

The Company, through its subsidiaries, operates out of facilities located in North Plains, Oregon. JCC's business consists of the manufacturing and distribution of specialty metal products and wholesale distribution of wood products to home centers and other retailers located primarily in the United States. Greenwood is a processor and distributor of industrial wood products used in a variety of markets and applications, including the marine and transportation markets. MSI is an importer and distributor of pneumatic air tools and industrial clamps in the United States. JCSC is a processor and distributor of agricultural seeds in the United States. JC USA provides professional and administrative services, including accounting and credit services, to its subsidiary companies.

JEWETT-CAMERON TRADING COMPANY LTD. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Expressed in U.S. Dollars)

AS OF AUGUST 31

2014

2013

ASSETS

Current assets

  Cash

$   4,327,540

$    8,308,445

  Accounts receivable, net of allowance 
     of $Nil (August 31, 2013 - $Nil)

 

2,442,928

 

3,344,777

  Inventory, net of allowance
     of $111,756 (August 31, 2013 - $134,259) (note 3)

9,154,129

8,520,991

  Note receivable

15,000

15,000

  Prepaid expenses

762,533

587,609

  Prepaid income taxes

546,347

270,423

  Total current assets

17,248,477

21,047,245

Property, plant and equipment, net (note 4)

2,147,387

2,241,950

 

Intangible assets, net (note 5)

 

295,956

 

368,662

Total assets

$  19,691,820

$  23,657,857

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

  Accounts payable

$       240,825

$   1,715,458

  Litigation reserve (note 13(a))

117,387

144,103

  Accrued liabilities

1,073,930

1,149,882

  Total current liabilities

1,432,142

3,009,443

Deferred tax liability (note 6)

60,972

50,393

Total liabilities

1,493,114

3,059,836

Contingent liabilities and commitments (note 13)

Stockholders' equity

  Capital stock (note 8)

     Authorized

      21,567,564 common shares, without par value

      10,000,000 preferred shares, without par value

    Issued

      2,704,630 common shares (August 31, 2013 - 3,134,936)

1,276,201

1,479,246

  Additional paid-in capital

600,804

600,804

  Retained earnings

16,321,701

18,517,971

  Total stockholders' equity

18,198,706

20,598,021

  Total liabilities and stockholders' equity

$  19,691,820

$  23,657,857

 

 

JEWETT-CAMERON TRADING COMPANY LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Expressed in U.S. Dollars)

YEARS ENDED AUGUST 31

2014

2013

SALES

$  42,339,563

$  49,286,147

COST OF SALES

33,961,367

39,455,054

GROSS PROFIT

8,378,196

9,831,093

OPERATING EXPENSES

Selling, general and administrative

1,700,030

1,503,226

Depreciation and amortization

276,340

256,487

Wages and employee benefits

3,317,228

3,397,690

 

5,293,598

 

5,157,403

Income from operations

3,084,598

4,673,690

OTHER ITEMS

Gain on sale of property, plant and equipment

3,546

353,852

Interest and other income

27,086

37,383

30,632

391,235

Income before income taxes

3,115,230

5,064,925

Income taxes (note 6)

Current

1,246,198

1,780,940

Deferred

10,579

151,966

Net income for the year

1,858,453

$  3,132,019

Basic earnings per common share

$          0.63

$           1.00

Diluted earnings per common share

$          0.63

$           1.00

Weighted average number of common shares outstanding:

Basic

2,968,220

3,135,509

Diluted

2,968,220

3,135,509

 

 

JEWETT-CAMERON TRADING COMPANY LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in U.S. Dollars)

YEARS ENDED AUGUST 31

2014

2013

CASH FLOWS FROM OPERATING ACTIVITIES

Net income for the year

$  1,858,453

$  3,132,019

Items not affecting cash:

                Depreciation and amortization

276,340

256,487

                Gain on sale of property, plant and equipment

(3,546)

(353,852)

                Deferred income taxes

10,579

151,966

                Interest income on litigation

(26,716)

(26,716)

Changes in non-cash working capital items:

Decrease (increase) in accounts receivable

901,849

(251,935)

Decrease in note receivable

-

5,000

Increase in inventory

(633,138)

(1,435,602)

Increase in prepaid expenses

(174,924)

(198,652)

Increase in prepaid income taxes

(275,924)

(270,423)

Increase (decrease) in accounts payable and accrued liabilities

(1,550,585)

107,091

Decrease in accrued income taxes

-

(37,203)

Net cash provided by operating activities

382,388

1,078,180

CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds on sale of property, plant and equipment

4,800

410,000

Purchase of property, plant and equipment

(110,325)

(481,935)

Net cash used in investing activities

(105,525)

(71,935)

CASH FLOWS FROM FINANCING ACTIVITIES

Redemption of common stock

(4,257,768)

(7,188)

                Net cash used in financing activities

(4,257,768)

(7,188)

Net increase (decrease) in cash

(3,980,905)

999,057

Cash, beginning of year

8,308,445

7,309,388

Cash, end of year

$  4,327,540

$  8,308,445

 

Contact: Don Boone, President & CEO, (503) 647-0110(503) 647-0110

 

Source: Jewett-Cameron Trading Company Ltd.

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