Canada Bread First Quarter Financial 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 -- 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 Bread Company, Limited (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :CBY CBY Central Bank of Yemen CBY Camp Burn Yourself (Swedish alternative arts festival) CBY Suvorov Military School (Russian acronym) ) today announced its financial results for the first quarter ended March 31, 2005. "Our first quarter operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before reflect continued strong results, with increased sales and volume across our fresh and frozen bakery operations," said Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a Lan, 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. of Canada Bread. "Canada Bread is benefiting from increasing demand for bread products and particularly strong demand in premium nutrition nutrition, study of the materials that nourish an organism and of the manner in which the separate components are used for maintenance, repair, growth, and reproduction. Nutrition is achieved in various ways by different forms of life. categories and in the foodservice The foodservice (or food service) industry (US English; catering industry in British English) encompasses those places, institutions, and companies responsible for any meal eaten away from home. sandwich Sandwich, city, Canada Sandwich, Ont., Canada, part (since 1935) of the city of Windsor. Sandwich, town, England Sandwich, town (1991 pop. 4,184), Kent, SE England, on the Stour River. market. We continue to see opportunity for growth." Sales for the first quarter increased to $316.9 million from $305.4 million for the prior year period, due primarily to growth in the Fresh Bakery business. The company recorded restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). expenses in the quarter of $4.7 million ($3.2 million after tax) to account for several business restructuring initiatives, principally the closure of a bakery in Peterborough Peterborough, city, Canada Peterborough, city (1991 pop. 68,371), SE Ont., Canada, NE of Toronto. It is at the falls of the Otonabee River, which connects, through the Trent Canal, with lakes Ontario and Huron. Settled early in the 19th cent. , England England, the largest and most populous portion of the United Kingdom of Great Britain and Northern Ireland (1991 pop. 46,382,050), 50,334 sq mi (130,365 sq km). It is bounded by Wales and the Irish Sea on the west and Scotland on the north. . Net earnings for the quarter before restructuring costs were $15.1 million ($0.59 per share) compared to $12.5 million ($0.49 per share) last year. Including restructuring costs, net earnings were $11.9 million ($0.47 per share). Operating Review Earnings from operations before restructuring costs increased to $22.0 million compared to $19.4 million last year. Comparisons of earnings from operations exclude $4.7 million of restructuring costs in the first quarter of 2005. Management believes this is the most appropriate basis on which to evaluate operating results, as restructuring costs are not representative of ongoing operating earnings. The Fresh Bakery's sales grew by 5% to $220.8 million, while earnings from operations were $15.0 million compared to $9.9 million in the first quarter last year. Strong sales of premium nutrition multigrain and specialty breads, operating cost reductions, and price increases that offset inflationary in·fla·tion·ar·y adj. Of, associated with, or tending to cause inflation: inflationary prices; inflationary policies. Adj. 1. cost increases all contributed to increased earnings for the first quarter. Fresh pasta While the only basic difference between these names is the shape of the pasta, each pasta is typically matched with a particular sauce based on cooking time, consistency, ability to hold sauce, ease of eating, etc. and sauce earnings increased significantly driven by new U.S. product distribution. Frozen Bakery sales were up 1% to $96.0 million, due mainly to ongoing growth in the U.K. bakery operations. Operating earnings were down 26% to $7.0 million compared to the first quarter last year primarily due to increased distribution and input costs, including fuel and other costs. This more than offset an increase in sales volumes, particularly in foodservice. In response to these cost increases, the Company is negotiating and implementing price increases. The Company commenced sales of its new FroBake(R) products in the U.S. late in the quarter, with good early market response. In order to meet the growing consumer demand for bagels in the U.K., the Company has completed construction of a new bagel facility in Rotherham Rotherham (rŏth`ərəm), city (1991 pop. 122,374) and metropolitan district, N England, at the confluence of the Don and Rother rivers. , U.K. This new facility is now operational and will increase production capacity, improve the quality of product and lower production costs. With the commissioning of this new facility, the Company is closing its bakery in Peterborough, England. Cash Flow and Financing Cash flow from operating activities for first quarter was a use of funds of $3.9 million compared to a source of funds of $28.6 million last year. This year over year change was due primarily to an increase in working capital in the first quarter of 2005, due to a reduction in accounts payable and income taxes payable. Capital expenditures increased to $11.9 million from $10.6 million last year, largely due to the installation of new equipment to support the new FroBake(R) line of products and completion of the new bagel plant in the United Kingdom. Other Matters The Company 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. a dividend of $0.06 per share payable on July July: see month. 4, 2005 to shareholders of record on June June: see month. 17, 2005. Canada Bread, which is 86.9% owned by Maple Leaf Foods Maple Leaf Foods TSX: MFI is a major Canadian food processing company. The company was originally known as Maple Leaf. It was founded in 1927 as a merger of several major Toronto meat packers, most prominently William Davies Co. Inc., is a leading manufacturer and distributor of fresh bakery products, frozen par-baked products and fresh pasta and sauces. The Company had 2004 sales of $1.3 billion and employs approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 7,300 people at its operations across 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. and in the United Kingdom.
Consolidated Financial Statements
(Expressed in Canadian dollars)
CANADA BREAD COMPANY,
LIMITED
Three months ended March 31, 2005 and 2004
CANADA BREAD COMPANY, LIMITED
Consolidated Balance Sheets
(In thousands of Canadian dollars)
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As at As at As at
March 31, March 31, December 31,
2005 2004 2004
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(Unaudited) (Unaudited)
(As restated) (As restated)
(Note 2 (a)) (Note 2 (a))
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ASSETS
Current assets
Cash and cash equivalents $ 19,071 $ 31,297 $ 9,312
Accounts receivable (Note 4) 19,207 24,186 24,148
Due from Maple Leaf Foods Inc. - 2,405 -
Inventories 32,960 34,834 33,504
Future tax asset - current 6,711 6,137 5,193
Prepaid expenses and other
assets 1,830 2,693 2,103
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79,779 101,552 74,260
Property and equipment 354,538 335,315 354,128
Other long-term assets 3,075 2,381 3,386
Future tax asset - non-current 6,622 2,124 5,465
Goodwill 324,477 335,141 324,237
Other intangibles 6,143 7,485 6,167
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$ 774,634 $ 783,998 $ 767,643
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and
accrued charges $ 128,133 $ 142,157 $ 149,410
Due to Maple Leaf Foods Inc. 323 - 140
Dividends payable 1,525 1,525 1,525
Income and other taxes payable 15,860 3,453 26,501
Current portion of long-term
debt (Note 5) 118,281 700 91,482
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264,122 147,835 269,058
Long-term debt (Note 5) 322 176,282 344
Future tax liability 23,842 31,197 21,780
Shareholders' equity 486,348 428,684 476,461
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$ 774,634 $ 783,998 $ 767,643
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The accompanying notes to the consolidated financial statements are
an integral part of these statements.
CANADA BREAD COMPANY, LIMITED
Consolidated Statements of Earnings
(In thousands of Canadian dollars, except share amounts)
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Three months ended March 31,
(Unaudited) 2005 2004
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Sales $ 316,861 $ 305,412
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Earnings from operations before
restructuring costs 22,025 19,378
Restructuring costs (note 3) 4,723 -
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Earnings from operations 17,302 19,378
Other income 308 112
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Earnings before interest and income taxes 17,610 19,490
Interest expense 1,701 1,387
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Earnings before income taxes 15,909 18,103
Income taxes 4,024 5,554
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Net earnings for the period $ 11,885 $ 12,549
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Basic earnings per share $ 0.47 $ 0.49
Diluted earnings per share $ 0.47 $ 0.48
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Weighted average number of shares
(millions) 25.4 25.4
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Consolidated Statements of Retained Earnings
(In thousands of Canadian dollars)
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Three months ended March 31,
(Unaudited) 2005 2004
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Retained earnings, beginning of period $ 337,827 $ 277,279
Net earnings for the period 11,885 12,549
Dividends declared ($0.06 per share;
2004: $0.06 per share) (1,525) (1,525)
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Retained earnings, end of period $ 348,187 $ 288,303
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The accompanying notes to the consolidated financial statements are
an integral part of these statements.
CANADA BREAD COMPANY, LIMITED
Consolidated Statements of Cash Flows
(In thousands of Canadian dollars)
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Three months ended March 31,
(Unaudited) 2005 2004
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CASH PROVIDED BY (USED IN)
Operating activities
Net earnings $ 11,885 $ 12,549
Add (deduct) items not affecting cash:
Depreciation and amortization 10,599 10,444
Future income taxes (613) (288)
Gain on sale of property and equipment (252) (74)
Other 104 42
Change in operating working capital (25,666) 5,888
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(3,943) 28,561
Financing activities
Dividends paid (1,525) (1,525)
Increase in long-term debt 25,224 2,771
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23,699 1,246
Investing activities
Additions to property and equipment (11,940) (10,602)
Proceeds from sale of property and
equipment 2,069 688
Change in intangible assets (126) (124)
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(9,997) (10,038)
Increase in cash and cash equivalents 9,759 19,769
Cash and cash equivalents, beginning
of period 9,312 11,528
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Cash and cash equivalents, end of
period $ 19,071 $ 31,297
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The accompanying notes to the consolidated financial statements are
an integral part of these statements.
CANADA BREAD COMPANY, LIMITED
Segmented Financial Information
(In thousands of Canadian dollars)
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Three months ended March 31,
(Unaudited) 2005 2004
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Sales
Fresh Bakery $ 220,813 $ 210,630
Frozen Bakery 96,048 94,782
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$ 316,861 $ 305,412
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Earnings from operations before
restructuring costs
Fresh Bakery $ 15,020 $ 9,915
Frozen Bakery 7,005 9,463
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$ 22,025 $ 19,378
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Additions to property and equipment
Fresh Bakery $ 4,181 $ 4,822
Frozen Bakery 7,759 5,780
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$ 11,940 $ 10,602
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Depreciation and amortization
Fresh Bakery $ 5,622 $ 5,321
Frozen Bakery 4,977 5,123
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$ 10,599 $ 10,444
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As at As at As at
March 31, March 31, December 31,
2005 2004 2004
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(Unaudited)(Unaudited)
Total assets
Fresh Bakery $ 394,886 $ 391,611 $ 395,355
Frozen Bakery 370,369 375,668 364,919
Non-allocated assets 9,379 16,719 7,369
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$ 774,634 $ 783,998 $ 767,643
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The accompanying notes to the consolidated financial statements are
an integral part of these statements.
CANADA BREAD COMPANY, LIMITED
Notes to Consolidated Financial Statements
(Tabular amounts in thousands of Canadian dollars)
Three months ended March 31, 2005 and 2004
1. THE COMPANY Canada Bread Company, Limited ("Canada Bread" or "the Company") and its subsidiaries operate in the bakery industry across North America and internationally. Its principal business is the manufacture and sale of bakery and pasta products, including fresh bread, rolls, bagels and par-baked bread. Canada Bread is 86.9% owned by Maple Leaf Foods Inc. ("Maple Leaf maple leaf of Canada. [Flower Symbolism: Jobes, 283] See : Flower Or Plant, National ") as at March 31, 2005. 2. SIGNIFICANT ACCOUNTING POLICIES The unaudited interim 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 should be read in conjunction with the annual consolidated financial statements for the year ended December December: see month. 31, 2004. These unaudited interim consolidated financial statements have been prepared 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 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 using the same accounting policies as were applied in the consolidated financial statements for the year ended December 31, 2004, except for the following: (a) Convertible debentures Convertible Debenture Any type of debenture that can be converted into some other security. Notes: For example, a convertible bond can be converted into stock. Effective January January: see month. 1, 2005 the company adopted the amendment to CICA CICA Competition In Contracting Act of 1984 (USA) CICA Canadian Institute of Chartered Accountants CICA Competition In Contracting Act CICA Criminal Injuries Compensation Authority (UK) Handbook
This article is about reference works. For the subnotebook computer, see .
A retroactive or retrospective law is one that takes away or impairs vested rights acquired under existing laws, creates new obligations, imposes new duties, or attaches a basis with restatement Restatement A revision in a company's earlier financial statements. Notes: The need for restating financial figures can result from fraud, misrepresentation, or a simple clerical error. of prior periods. The revised standard, which is effective for 2005, requires obligations of a fixed amount that may be settled, at the issuer's option, by a variable number of the issuer's own equity instruments to be presented as liabilities. As a result of adopting the revised standard, the company retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin reclassified $20 million of convertible debt as a liability on the balance sheet. The company had previously included the $20 million in equity related to a debt facility with Maple Leaf due to the fact that is can be settled, at the option of Canada Bread, in common shares. There was no impact on net earnings, basic or diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for prior periods as a result of adopting this change retroactively. (b) Variable interest entities The Company adopted the guidance in Accounting Guideline guideline Medtalk A series of recommendations by a body of experts in a particular discipline. See Cancer screening guidelines, Cardiac profile guidelines, Gatekeeper guidelines, Harvard guidelines, Transfusion guidelines. 15, "Consolidation of Variable Interest Entities" retroactively without restatement of prior periods, effective January 1, 2005. This guideline addresses the consolidation of variable interest entities, which are entities that have insufficient equity and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. their equity investors lack one or more specified essential characteristics of a controlling financial interest. The guideline also provides guidance for determining who, if anyone, should consolidate Consolidate To combine the assets, liabilities, and other financial items of two or more entities into one. Notes: This term is generally used in the context of consolidated financial statements. the variable interest entity. The adoption of this standard does not have a material impact on the Company. (c) Comparative figures Certain 2004 comparative figures have been reclassified to conform to Verb 1. conform to - satisfy a condition or restriction; "Does this paper meet the requirements for the degree?" fit, meet coordinate - be co-ordinated; "These activities coordinate well" the financial statement presentation adopted in 2005. 3. RESTRUCTURING COSTS During the first quarter of 2005, the Company recorded a $4.7 million in restructuring costs ($3.2 million after tax), relating primarily to the closure of its bakery in Peterborough, England and the closure of a pasta manufacturing line due to the termination of a co-packing arrangement with Maple Leaf. 4. 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 Under revolving securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. programs, the Company has sold, with limited recourse Limited recourse A term describing a type of loan in which the lender has limited or no claim against the parent company if the collateral is insufficient to repay the debt. See:Nonrecourse. , certain of its trade accounts receivable to financial institutions. The Company retains servicing responsibilities and assumes limited recourse obligations for delinquent delinquent 1) adj. not paid in full amount or on time. 2) n. short for an underage violator of the law as in juvenile delinquent. DELINQUENT, civil law. He who has been guilty of some crime, offence or failure of duty. receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed . At March 31, 2005, trade accounts receivable being serviced under this program amounted to $70.0 million (March 31, 2004: $66.8 million; December 31, 2004: $70.0 million). 5. 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. As at March 31, 2005, the Company had $118.6 million outstanding in long-term debt of which $79.4 million (March 31, 2004: $97.6 million; December 31, 2004: $90.8 million) was due to Maple Leaf. 6. PENSIONS During the quarter, the Company recorded $2.3 million related to net benefit plan expense (2004: $2.1 million). 7. SUPPLEMENTAL CASH FLOW INFORMATION
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Three months ended March 31,
2005 2004
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Net interest paid $ 2,234 $ 1,090
Net income taxes paid 15,190 7,363
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Canada Bread Company, Limited (TSX:CBY) |
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