Acquisitions Contribute to Strong Growth for Andres Wines.GRIMSBY, Ontario Grimsby (2001 population 21,297) is a town on Lake Ontario in the Niagara Region, Ontario, Canada. The majority of residents reside in the area bounded by Lake Ontario and the Niagara escarpment. -- NEW ULTRA PREMIUM BRANDS STRENGTHEN LEADING MARKET POSITION Andres Andres may refer to:
TSX Transfer from Stack Pointer to Index TSX True Space Extension :ADW See Key:Enterprise. .NV.A)(TSX:ADW.B) announced today its results for the three and nine months ended December December: see month. 31, 2005. Sales for the third quarter of fiscal 2006 rose 24.6% to $59.5 million from $47.7 million last year. For the nine months ended December 31, 2005 sales increased 24.9% to $163.3 million from $130.7 million last year. The increase is due primarily to the contributions made by the acquisitions of Thirty Bench Winery Thirty Bench Winery is a small vineyard and winery in Beamsville, Ontario, Canada. This Niagara region producer specialtizes in Cabernets, Merlots, Rieslings, Gewuztraminers, and icewines. The vintage 1998 Benchmark Blend won second place in a field of 16 wines at the St. on May 2, 2005, Cascadia The name Cascadia, which is derived from the name of the Cascade Range, can refer to: Cities:
This xeric fire-maintained ecosystem features very short fire return intervals, one to five years. Wines, Granville There are a number of uses of the term Granville. See also Grandville. Earls Granville
n. pl. win·er·ies An establishment at which wine is made. Noun 1. winery - distillery where wine is made wine maker on November November: see month. 1, 2005, and to the Company's successful initiatives to grow sales of its premium and ultra-premium wines. During the quarter, Andres sold the assets and brands related to the spirits division of Cascadia for approximately $5.8 million. "Our integration efforts are proceeding extremely well and our new premium brands have great potential," commented John Peller, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "Looking ahead, the cost synergies Cost Synergy In the context of mergers, cost synergy is the savings in operating costs expected after two companies, who compliment each other's strengths, join. Notes: The savings in operating costs usually come in the form of laying off employees. and economies of scale to come from the combination of our western wineries; along with the positive contributions from our increased sales, are expected to generate enhanced growth and profitability." Gross margin as a percentage of sales declined in the third quarter and first nine months of fiscal 2006 compared to the prior year periods due primarily to increases in the price of grapes Grapes - A Modula-like system description language. E-mail: <peter@cadlab.cadlab.de>. ["GRAPES Language Description. Syntax, Semantics and Grammar of GRAPES-86", Siemens Nixdorf Inform, Berlin 1991, ISBN 3-8009-4112-0]. and raw materials. In addition, Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting ("GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ") requires the Company to record the inventory of acquired companies at fair market value, reducing the gross profit earned by Cascadia Brands during the period. Once this inventory has been sold, it is expected that gross profit related to these product lines will return to normal levels. Selling, general and administration expenses have increased in fiscal 2006 as a result of the acquisitions completed this year and increases in advertising and promotional spending incurred to support higher sales of premium wine. The Company previously announced that it was closing its facility in Port Moody mood·y adj. 1. Given to frequent changes of mood; temperamental. 2. Subject to periods of depression; sulky. 3. Expressive of a mood, especially a sullen or gloomy mood. , B.C. and moving production into its winery in Kelowna Kelowna (kĭlō`nə), city (1991 pop. 75,950), S British Columbia, Canada, on Okanagan Lake. Kelowna is a tourist resort and serves as a trade center for a fruit-growing and lumbering area. , B.C. Management expects it will generate significant cost savings and economies of scale once the integration of the facilities is complete. The Port Moody facility closed on December 31, 2005 with full production in Kelowna beginning on April 1, 2006. Costs related to the closure of the Company's Port Moody facility and to related integration expenses are being expensed as incurred, and resulted in unusual charges to income of $1.0 million through the first nine months of fiscal 2006. Management expects that the total cost related to this initiative will amount to between $2.0 million and $2.5 million once completed on or before the end of March 2007. Including these unusual items, net income for the three and nine months ended December 31, 2005 was $3.5 million or $0.72 per Class A share and $7.3 million or $1.51 per Class A share respectively. Excluding the unusual items, net earnings would have been $3.7 million or $0.85 per Class A share for the third quarter and $7.9 million or $1.64 per Class A share for the first nine months of fiscal 2006. The changes to the Company's balance sheet compared to the end of fiscal 2005 are primarily due to the acquisitions completed so far this year. Working capital was $40.0 million at December 31, 2005 compared to $29.8 million at March 31, 2005. The increase in long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. at the end of the third quarter of fiscal 2006 compared to the prior year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. was due primarily to the three acquisitions completed during the period. Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. at December 31, 2005 rose to $92.1 million or $18.59 per share from $87.2 million or $17.59 per share as at March 31, 2005. Cash from operating activities for the nine months ended December 31, 2005, after changes in non-cash working capital items, was $11.9 million compared to $2.7 million last year. The change is due to a significant increase in inventory related to a larger crush crush A combination commodity trade in which soybean futures are purchased and soybean meal or oil futures are sold. Compare reverse crush. during fiscal 2005 and to the increase during fiscal 2006 in accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying at Cascadia over the holiday season. Inventory remained flat during fiscal 2006 as an increased build in Western Canada
Western Canada, commonly referred to as the West relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the transfer of production from Port Moody to Kelowna was more than offset by a lower crush in Ontario Ontario, city, United States Ontario, city (1990 pop. 133,179), San Bernardino co., S Calif., near Los Angeles, in a region of vineyards; inc. 1891. . Andres continues to pay an annual dividend of $0.644 per Class A share and $0.560 per Class B share. Financial Highlights (complete statements follow) --------------------------------------------------------------------- --------------------------------------------------------------------- Period Ended December 31, Three Months Nine Months --------------------------------------------------------------------- (in $,000 except per share amounts) 2005 2004 2005 2004 --------------------------------------------------------------------- Sales 59,453 47,725 163,340 130,739 EBITA 9,001 8,831 21,252 18,195 Earnings before unusual items and taxes 5,906 6,986 12,703 12,811 Unusual items (355) - (990) - Net earnings 3,453 4,498 7,280 8,140 Net earnings per share (Basic per Class A share) $0.72 $0.93 $1.51 $1.69 Cash from operations (after changes in non-cash working capital items) 4,365 (5,689) 11,949 2,670 Working capital 40,039 34,228 Shareholders' equity per share $18.59 $17.67 --------------------------------------------------------------------- --------------------------------------------------------------------- Andres Wines Ltd. is a leading producer and marketer of quality wines in Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of . With wineries in British Columbia British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography , Ontario and Nova Scotia Nova Scotia (nō`və skō`shə) [Lat.,=new Scotland], province (2001 pop. 908,007), 21,425 sq mi (55,491 sq km), E Canada. Geography , the Company markets wines produced from grapes grown in Ontario's Niagara Peninsula The Niagara Peninsula is the portion of Ontario, Canada lying on the south shore of Lake Ontario. It stretches from the Niagara River in the east to Hamilton, Ontario in the west. Lake Ontario lies to the north and Lake Erie to the south. , British Columbia's Okanagan This article is about the region in Canada. For other uses of the term, see Okanogan. The Okanagan (IPA: [o kə ˈnɑ ɡn̩]), also known as the Okanagan Valley and sometimes as Valley and vineyards around the world. The Company's award-winning Adj. 1. award-winning - having received awards; "this award-winning bridge spans a distance of five miles" premium and ultra-premium brands include Peller Estates, Trius, Hillebrand Estates, Thirty Bench, Sandhill, Copper Moon, Calona Vineyards Artist Series VQA VQA Vintners Quality Alliance (Canadian wine makers standards organization) VQA Voice Quality Assurance (Ditech Communications) VQA Volunteer Quality Alert (US IRS) wines and Red Rooster wines. Complementing these premium brands are a number of popular priced products including Hochtaler, Domaine D'Or, Schloss Laderheim, Royal and Sommet. With the acquisition of Cascadia Brands Inc, the Company also markets craft beer under the Granville Island brand. With a focus on serving the needs of all wine consumers, the Company produces and markets consumer-made wine kit products through Winexpert Inc. and Vineco International. In addition, the Company owns and operates Vineyards Estate Wines and WineCountry Vintners, an independent wine retailer in Ontario with more than 100 well-positioned retail locations. Andres common shares trade on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. (symbols ADW.NV.A and ADW.B). The Company utilizes EBITA EBITA Earnings Before Interest Taxes Amortization (defined as earnings before interest, incomes taxes, depreciation, amortization and unusual items) and EBUI (defined as earnings before income taxes and unusual items) to measure its financial performance. EBITA and EBUI are not recognized measures under GAAP. Management believes that EBITA and EBUI are useful supplemental measures to net earnings (loss), as it provides readers with an indication of cash available for investment prior to debt service, capital expenditures and income taxes. Readers are cautioned that EBITA and EBUI should not be construed as alternatives to net earnings (loss) determined in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with GAAP as an indicator of the Company's performance or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. In addition, the Company's method of calculating EBITA and EBUI may differ from the methods used by other companies and, accordingly, may not be comparable to measures used by other companies.
ANDRES WINES LTD.
Consolidated Statements of Earnings and Retained Earnings
For the Three For the Nine
Months Ended Months Ended
December 31 December 31
2005 2004 2005 2004
$ $ $ $
---------------------------------------------------------------------
Sales 59,453 47,725 163,340 130,739
Cost of goods sold, excluding
amortization 34,654 27,067 95,461 74,475
----------------------------------
Gross profit 24,799 20,658 67,879 56,264
Selling and administration 15,798 11,827 46,627 38,069
----------------------------------
Earnings before interest and
amortization 9,001 8,831 21,252 18,195
Interest 1,227 564 3,275 1,531
Amortization of plant, equipment
and intangibles 1,868 1,281 5,274 3,853
----------------------------------
Earnings before unusual items 5,906 6,986 12,703 12,811
Unusual items (355) - (990) 0
----------------------------------
Earnings before income taxes 5,551 6,986 11,713 12,811
----------------------------------
Provision for income taxes
Current 2,153 2,429 4,348 4,499
Future (55) 59 85 172
----------------------------------
2,098 2,488 4,433 4,671
----------------------------------
Net earnings for the period 3,453 4,498 7,280 8,140
Retained earnings- Beginning of
period 82,197 76,582 79,924 74,494
Dividends:
Class A and Class B 777 777 2,331 2,331
----------------------------------
Retained earnings- End of period 84,873 80,303 84,873 80,303
----------------------------------
----------------------------------
Net earnings per share
Basic and Diluted
Class A shares 0.72 0.93 1.51 1.69
----------------------------------
----------------------------------
Class B shares 0.62 0.81 1.31 1.47
----------------------------------
----------------------------------
ANDRES WINES LTD.
Consolidated Statements of Cash Flows
For the Three For the Nine
Months Ended Months Ended
December 31 December 31
2005 2004 2005 2004
$ $ $ $
---------------------------------------------------------------------
Cash provided by (used in)
Operating activities
Net earnings for the period 3,453 4,498 7,280 8,140
Items not affecting cash:
Amortization of plant, equipment
and intangibles 1,868 1,281 5,274 3,853
Future income taxes (55) 59 85 172
Amortization of deferred
financing costs 29 17 78 51
------------------------------------
5,295 5,855 12,216
Changes in non-cash working
capital items related to
operations, net of acquisitions: (930) (11,544) (768) (9,546)
------------------------------------
4,365 (5,689) 11,949 2,670
------------------------------------
Investing activities
Acquisition of Thirty Bench - - (4,510) -
Acquisition of Cascadia, net of
cash acquired (306) - (33,666) -
Acquisition of Red Rooster (5,549) - (5,549) -
Proceeds from sale of spirit
business 5,782 - 5,782 -
Purchase of property and
equipment (1,121) (1,330) (3,521) (4,280)
------------------------------------
(1,194) (1,330) (41,464) (4,280)
------------------------------------
Financing activities
Increase in deferred financing
costs (12) - (324) -
Increase in other assets (79) - (150) -
Repayment of long-term debt (6,356) (610) (20,407) (1,825)
Increase in long-term debt 6,000 - 56,000 -
Increase in (repayment of)
bank indebtedness (1,947) 8,406 (3,273) 5,331
Issue of Class A shares - - - 430
Dividends paid (777) (777) (2,331) (2,326)
------------------------------------
(3,171) 7,019 29,515 1,610
------------------------------------
Cash at beginning and end
of period - - - -
------------------------------------
------------------------------------
ANDRES WINES LTD.
CONSOLIDATED BALANCE SHEETS
---------------------------------------------------------------------
---------------------------------------------------------------------
Unaudited Audited
December 31 2005 March 31 2005
$ $
---------------------------------------------------------------------
Assets
Current Assets
Accounts receivable 23,684 14,132
Inventories 76,093 62,045
Prepaid expenses 2,880 2,531
Income taxes recoverable - 693
----------------------------
102,657 79,401
Property, plant and equipment 83,458 55,897
Goodwill 30,265 23,759
Other assets 11,454 3,762
----------------------------
227,834 162,819
----------------------------
----------------------------
Liabilities
Current Liabilities
Bank indebtedness 28,483 31,756
Accounts payable and accrued liabilities 26,400 14,795
Dividends payable 777 777
Income taxes payable 1,192 -
Current portion of long - term debt 5,766 2,250
----------------------------
62,618 49,578
Long-term debt 61,566 17,313
Future income taxes 11,533 8,760
----------------------------
135,717 75,651
----------------------------
Shareholders' Equity
Capital Stock 7,244 7,244
Retained Earnings 84,873 79,924
----------------------------
92,117 87,168
----------------------------
227,834 162,819
----------------------------
----------------------------
Andres Wines Ltd. (TSX:ADW.NV.A) (TSX:ADW.B) |
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