Associated Brands Announces 2004 Results.TORONTO Toronto (tərŏn`tō), city (1998 est pop. 2,400,000), provincial capital, S Ont., Canada, on Lake Ontario. Toronto is the largest city in Canada and since the 1970s has been one of the fastest-changing cities in North America, experiencing -- Associated Brands Income Fund (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :ABF ABF Arbetarnas BildningsFörbund ABF American Breakfast (Thailand Hotels) ABF Associated British Foods plc (London, UK) ABF Association des Bibliothecaires Francais (French) .UN) announced today its results for the year ended December December: see month. 31, 2004. Sales in 2004 were $156.1 million compared to $158.6 in 2003. While sales growth was strong through the first two quarters of 2004, declines occurred in the third quarter due to unseasonable un·sea·son·a·ble adj. 1. Not suitable to or appropriate for the season. 2. Not characteristic of the time of year: unseasonable weather. 3. Poorly timed; inopportune. weather in eastern Canada Eastern Canada (also the Eastern provinces) is the region of Canada generally considered to be east of Manitoba, consisting of the following provinces:
loonie dollar - the basic monetary unit in many countries; equal to 100 cents compared to the U.S. dollar reduced reported sales by $6.8 million for the year ended December 31, 2004. Earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. through the last half of the year. Packaging development expenses were also higher in 2004 due to mandatory Peremptory; obligatory; required; that which must be subscribed to or obeyed. Mandatory statutes are those that require, as opposed to permit, a particular course of action. new nutritional nutritional pertaining to or emanating from nutrition. nutritional anemia see nutritional anemia. nutritional assessment labeling regulations in Canada and the United States The United States and Canada share a unique legal relationship. U.S. law looks northward with a mixture of optimism and cooperation, viewing Canada as an integral part of U.S. economic and environmental policy. . Partially offsetting these negative factors was the positive impact of the stronger Canadian dollar on materials and ingredients consumed con·sume v. con·sumed, con·sum·ing, con·sumes v.tr. 1. To take in as food; eat or drink up. See Synonyms at eat. 2. a. in Canada but purchased in U.S. dollars. As a percentage of sales, gross profit was 19.3% of sales in 2004 compared to 19.1% in 2003.Net earnings were $7.8 million or $0.596 per unit (diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. ) in 2004 compared to $7.7 million or $0.588 per unit (diluted) in 2003. For the year ended December 31, 2004, distributable cash was $10.5 million or $0.893 per Fund unit compared to $11.8 million or $0.999 per Fund unit in 2003. Distributions in 2004 were $1.036 per unit compared to $1.075 per unit in 2003. Effective with the November November: see month. 2004 distribution payment, monthly cash distributions were adjusted to $0.07 per unit from $0.0896 per unit. For the three months ended December 31, 2004, sales were $40.3 million compared to $46.1 million for the same period last year. EBITDA was $3.6 million compared to $4.9 million last year. Gross profit in the quarter was 18.8% of sales compared to 19.5% last year. Net earnings were $1.9 million or $0.145 per unit (diluted) compared to $2.8 million or $0.213 per unit (diluted) in the fourth quarter of 2003. Distributable cash for the fourth quarter of 2004 was $2.5 million or $0.215 per Fund unit compared to $3.9 million or $0.334 per Fund unit in the fourth quarter of last year. The Fund declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. distributions of $0.229 per Fund unit in the fourth quarter of 2004 compared to $0.269 in the fourth quarter of 2003. "While 2004 was a challenging year, we continued to build on our considerable strengths as one of North America's leading providers of private label dry blend food products and household products," stated John Currie John Currie was a U.S. soccer player who earned two caps with the U.S. national team in 1937. His first game with the national team in a 7-2 loss to Mexico on September 12, 1937. His second game was two weeks later, a 7-3 loss to Mexico.[1] , Executive Chairman."With our strong customer relationships, high quality offering and extensive industry experience, we are confident we will work through the challenges in our business and resume our pattern of growth and performance improvement over the long term." "Our objective is to become our customers' Partner of Choice for private label product development, sourcing, manufacturing and support," added Rob Dougans Rob Dougan, also known as Rob D (born in Sydney, Australia in 1965) is a genre-blending music composer. Mixing elements of orchestral music, trip hop, and bluesy vocals, his work is only tangentially relatable to electronic music. , President and Chief Executive Officer. "To achieve this goal, and to drive sales growth and margin improvement, we are implementing a number of initiatives aimed at operating our business more effectively and more efficiently." Mr. Dougans continued: "We are increasing our sales force and targeting specific vertical markets in grocery retail, industrial and food service sectors where we have a strong presence. We intend to grow our contract manufacturing business and leverage our proven ability to deliver high quality products that meet the needs of brand manufacturers looking to outsource their production. New products and private label solutions are increasingly positioning us as our customers' preferred sole source supplier. We are reducing our costs in a number of areas, improving manufacturing yields, and enhancing purchasing efficiencies. We also continue to evaluate acquisition opportunities that could strengthen our product lines, enhance our customer penetration and generate 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. ."
Financial Highlights (complete statements attached):
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Three Months Year
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Period Ended December 31,
($000, except unit and per unit
amounts and percentages) 2004 2003 2004 2003
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Sales 40,327 46,148 156,096 158,601
EBITDA 3,621 4,885 14,919 16,908
Net Earnings 1,897 2,784 7,785 7,680
Net Earnings per Unit
(diluted) $0.145 $0.213 $0.596 $0.588
Distributable Cash 2,526 3,934 10,500 11,756
Distributable Cash
per Fund Unit $0.215 $0.334 $0.893 $0.999
Distributions Declared
per Fund Unit $0.229 $0.269 $1.036 $1.075
Weighted Average Fund
Units Outstanding 11,762,800 11,762,800 11,762,800 11,762,800
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Associated Brands Income Fund (TSX: ABF.UN), through its operating subsidiaries An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. , is a leading North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. manufacturer and supplier of private-label dry blend food products and household products. Since beginning operations in 1985, Associated Brands has grown to become one of the three largest suppliers of a diverse range of private-label dry-blend food products in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , producing over eleven million cases annually across multiple product categories currently sold to 44 of the 50 largest North American food retailers. Associated Brands plans to build unitholder value by leveraging its solid presence in the U.S. private-label market, expanding its product offerings to current and new customers and adding additional contract manufacturing business, and through accretive acquisitions Accretive Acquisition An acquisition that will increase the acquiring company's EPS. Notes: As they are expected to increase the acquiring company's future earnings, these acquisitions tend to be favorable for the company's market price. that meet its strict operating and strategic criteria criteria (krītēr´ē  ),n. . More information can be obtained at www.associatedbrands.com. Certain statements in this press release may include "forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. " statements which involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of Associated Brands Income Fund to be materially different from any future results, performance or achievements expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. . When used in this press release, such statements use such words as "may", "will", "expect", "anticipate", "project", "believe", "plan", and other similar terminology The terminology used in the computer and telecommunications field adds tremendous confusion not only for the lay person, but for the technicians themselves. What many do not realize is that terms are made up by anybody and everybody in a nonchalant, casual manner without any regard or . The risks and uncertainties are detailed from time to time in reports filed by the Fund with the securities regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities in all of the provinces and territories of Canada. New risk factors may arise from time to time and it is not possible for management to predict all of those risk factors or the extent to which any factor or combination of factors may cause actual results, performance and achievements of the Fund to be materially different from those contained in forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction "Prediction is very difficult, especially if it's about the future." - Niels Bohr A prediction is a statement or claim that a particular event will occur in the future in more certain terms than a forecast. of actual results. As used herein, "EBITDA" means earnings before interest, income taxes, depreciation, amortization, management fees and translation gains and losses arising on all monetary assets and liabilities Monetary assets and liabilities Assets and liabilities with contractual payoffs. of the Fund denominated in a foreign currency. EBITDA is not a recognized measure under 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). "). Management believes that EBITDA is a useful supplemental measure to net earnings (loss), as it provides investors with an indication of cash available for distribution prior to debt service, capital expenditures and income taxes. Distributable cash is also not a defined term under GAAP. Distributable cash is equal to net earnings before amortization, future income taxes and translation gains and losses arising on monetary assets and liabilities of the Fund denominated in a foreign currency, less capital expenditures and debt repayments and reserves that the trustees may consider appropriate. Management believes distributable cash is a useful supplemental measure of operating performance, as it provides investors with an indication of cash available for distribution. Investors should be cautioned that neither EBITDA nor distributable cash should be construed as an alternative 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 Fund's performance or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. The Fund's method of calculating EBITDA and distributable cash may differ from the methods by which other issuers calculate EBITDA and distributable cash and, accordingly, EBITDA and distributable cash may not be comparable to measures used by other issuers. The following is a summarized version of the Consolidated Financial Statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge
Associated Brands Income Fund
Consolidated Statement of Earnings and Deficit
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For the Year Ended For the Year Ended
December 31, 2004 December 31, 2003
Sales $ 156,095,759 $ 158,600,779
Cost of sales 125,967,444 128,286,366
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30,128,315 30,314,413
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Expenses
General and administrative,
including foreign exchange 9,384,745 9,803,917
Selling and marketing 5,705,547 5,145,178
Amortization 3,583,819 3,578,437
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18,674,111 18,527,532
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11,454,204 11,786,881
Interest expense 1,930,944 1,704,791
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Earnings before income taxes 9,523,260 10,082,090
Income taxes 1,738,364 2,402,168
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Net earnings 7,784,896 $ 7,679,922
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Net earnings per unit
Basic $ 0.66 $ 0.65
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Diluted $ 0.60 $ 0.59
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Retained earnings (deficit),
beginning of period $ (4,816,761) $ 150,681
Net earnings 7,784,896 7,679,922
Distributions declared to
Fund unitholders (12,186,262) (12,647,364)
Distributions declared on
Class B exchangeable units - -
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Deficit, end of period $ (9,218,127) $ (4,816,761)
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Associated Brands Income Fund
Consolidated Balance Sheet
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December 31, 2004 December 31, 2003
Assets
Current
Receivables $ 12,644,937 $ 13,616,267
Income taxes receivable 99,596 -
Inventories 22,406,391 21,374,511
Prepaids 1,389,197 1,669,857
Future income taxes 251,968 309,262
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36,792,089 36,969,897
Property, plant and equipment 23,723,222 26,347,025
Trademarks 15,315,000 15,315,000
Goodwill 84,263,592 84,263,592
Other assets 443,240 619,817
Future income taxes 339,946 212,127
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$ 160,877,089 $ 163,727,458
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Liabilities
Current
Bank indebtedness $ 7,238,681 $ 5,047,439
Payables and accruals 9,947,126 10,134,239
Cash distributions payable 823,396 1,053,947
Payable to former owners 2,302,137 -
Income taxes payable - 1,696,398
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20,311,340 17,932,023
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Long-term debt 29,543,880 30,372,200
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Class B exchangeable units 12,023,908 12,023,908
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Unitholders' Equity
Fund units 108,216,088 108,216,088
Deficit (9,218,127) (4,816,761)
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98,997,961 103,399,327
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$ 160,877,089 $ 163,727,458
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Associated Brands Income Fund
Consolidated Statement of Cash Flows
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For the Year For the Year
Increase (decrease) in cash Ended December Ended December
and cash equivalents 31, 2004 31, 2003
Operating
Net earnings $ 7,784,896 $ 7,679,922
Amortization 3,583,819 3,578,437
Future income taxes (70,525) 166,014
Translation gain on long-term debt (828,320) (734,500)
Change in non-cash operating
working capital 539,135 (3,671,567)
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11,009,005 7,018,306
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Financing
Proceeds/(repayment) of bank
indebtedness 2,191,242 4,771,027
Payment of distributions
to unitholders (12,416,813) (13,349,682)
Repayment of payable
to former owners - (8,180,795)
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(10,225,571) (16,759,450)
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Investing
Purchase of property,
plant and equipment (678,929) (1,211,762)
Purchase of other assets (104,505) (6,939)
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(783,434) (1,218,701)
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Net decrease in cash and
cash equivalents - (10,959,845)
Cash and cash equivalents,
beginning of year - 10,959,845
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Cash and cash equivalents,
end of year $ - $ -
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Associated Brands 2004 Consolidated Financial Statements and Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial are available on the investor relations Investor relations The process by which the corporation communicates with its investors. page at www.associatedbrands.com and on SEDAR SEDAR System for Electronic Document Analysis and Retrieval SEDAR Southeast Data, Assessment, and Review at www.sedar.com. Associated Brands Income Fund (TSX:ABF.UN) |
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