Clairvest Group Inc. Financial Results.TORONTO--(BUSINESS WIRE)--Aug. 21, 1997--Clairvest Group Inc. (TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :CVG CVG Convergys Corp CVG Corporación Venezolana de Guayana CVG Clear Vertical Grain (woodworking) CVG Carrier Group CVG Corporacion Venezolana de Guyana CVG Comprehensive Video Group (South Hackensack, NJ, USA) .) Shareholders' Report For the Three Months Ended June June: see month. 30, 1997 Following a year of record investment activity in fiscal 1997, Clairvest spent much of its first quarter of fiscal 1998 working with its new partners to develop and implement strategies agreed upon Adj. 1. agreed upon - constituted or contracted by stipulation or agreement; "stipulatory obligations" stipulatory noncontroversial, uncontroversial - not likely to arouse controversy when the investments were made. Clairvest is ensuring that in the early stages of these investments, the proper frameworks are in place to create value for its partners, as well as the shareholders of Clairvest. Operating Results Clairvest's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: operating results for the three months ended June 30, 1997 include the results of its merchant banking operations, 84 percent owned NRI NRI Nomura Research Institute (Tokyo, Japan) NRI Non-Resident Indian NRI Natural Resources Institute NRI National Resources Inventory NRI Networked Readiness Index NRI Natural Resources Inventory NRI National Research Institute Industries Inc. ("NRI") (formerly National Rubber Inc.) and its recently acquired 87 percent interest in Signature Security Group Inc. ("Signature"). Net income for the three month period ended June 30, 1997 was $1.2 million or $0.06 per share fully 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. on revenue of $26.7 million, compared to net income of $1.1 million, or $0.06 per share fully diluted, on revenue of $18.5 million for the same period in 1996. The increase in consolidated revenues reflects the contribution from Signature in 1997. NRI Results Improve NRI continues to show strong improvement in its operating results, compared to the prior year. NRI reported net income of $0.7 million for the three months ended June 30, 1997, compared to a loss of $0.1 million reported in the same period in 1996. The increase in net income was the result of increased sales in both the Parts Manufacturing and the Materials Recycling recycling, the process of recovering and reusing waste products—from household use, manufacturing, agriculture, and business—and thereby reducing their burden on the environment. operations, as well as containment containment Strategic U.S. foreign policy of the late 1940s and early 1950s intended to check the expansionist designs of the Soviet Union through economic, military, diplomatic, and political means. It was conceived by George Kennan soon after World War II. of manufacturing and operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. . EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become of $3.4 million in 1997 compared favourably Adv. 1. favourably - showing approval; "he reviewed the play favorably" favorably favourably U.S. favorably adverb 1. with $1.7 million in the prior years quarter. The quarter ended June 30, 1997, was a period of significant development in NRI's history, as the Materials Recycling operations generated positive EBITDA for the first time. The tire grinding grinding, process by which surface material is removed from an object, usually metal, by the abrasive action of a rotating wheel or a moving belt that contains abrasive grains. plant in Chambersburg Chambersburg, borough (1990 pop. 16,647), seat of Franklin co., S Pa.; settled 1730, inc. 1803. Food products, apparel, construction materials, and transportation equipment are produced. , Pennsylvania Pennsylvania (pĕnsəlvā`nyə), one of the Middle Atlantic states of the United States. It is bordered by New Jersey, across the Delaware River (E), Delaware (SE), Maryland (S), West Virginia (SW), Ohio (W), and Lake Erie and New York was a significant contributor to this success, as this plant was able to increase sales to the tire manufacturing companies while improving operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: and decreasing costs. Chambersburg is now operating close to capacity, while the Michigan Michigan (mĭsh`ĭgən), upper midwestern state of the United States. It consists of two peninsulas thrusting into the Great Lakes and has borders with Ohio and Indiana (S), Wisconsin (W), and the Canadian province of Ontario (N,E). tire recycling Tire recycling is the process of recycling vehicles tires (or tyres) that are no longer suitable for use on vehicles due to wear or irreparable damage (such as punctures). unit's new "fine grind 1. GRIND - GRaphical INterpretive Display. A graphics input language for the PDP-9. ["GRIND: A Language and Translator for Computer Graphics", A.P. Conn, Dartmouth, June 1969]. 2. " second line is producing and selling commercial product and should be fully operational by the end of August. The second line at Michigan should contribute further to the positive results being generated by the Materials Recycling business. Encouraging Early Results at Signature Security Group Inc. Signature reported EBITDA of $0.3 million and a net loss of $0.9 million for its first quarter of operations, ended June 30, 1997. These operating results were in line with Clairvest's expectations. Revenues and operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. were ahead of expectations, due to better than anticipated sales performance. Corporate overheads and 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). costs were above budget, due to management's continuing investment in building the infrastructure necessary to support the expected significant growth in the business. Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. and New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. continue to show great promise - acquisition opportunities are presenting themselves more quickly than anticipated and internal growth of the customer base is strong. Additionally, Signature recently completed two acquisitions in New Zealand, increasing its customer base by approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 3,200 and bringing its total number of customers to just over 40,000. Signature is currently evaluating several additional acquisition opportunities and expects to close a number of these opportunities in the next few months. Developments at Clairvest's Other Core Investments Consoltex Group Inc. ("Consoltex") - As a result of improved manufacturing efficiencies, product mix and stable raw material prices in the Polypropylene polypropylene (pŏl'ēprō`pəlēn), plastic noted for its light weight, being less dense than water; it is a polymer of propylene. It resists moisture, oils, and solvents. Sector, Consoltex reported improved operating results for the three months ended June 30, 1997, compared to the same quarter in 1996. Consolidated sales increased 5.1 percent, from $135.7 million in 1996 to $142.6 million in 1997, while net earnings increased by 200 percent, from $1.6 million to $4.8 million during the same period. Cash flow was $10.8 million in 1997 compared to $7.8 million in 1996. Consoltex's improved results appear to have had a positive effect on its share price. Consoltex shares have risen to $3.90 as at August 15, 1997, an appreciation of more than a 100 percent over Clairvest's average cost to purchase. Datamark Inc. ("Datamark") - In May 1997, Clairvest purchased an additional 983,400 shares of Datamark for $3.4 million, pursuant to two private agreements, and increased its holdings in Datamark to approximately 4.2 million shares or 44 percent of the company (40 percent fully diluted). Datamark is Canada's fourth largest business forms printer and the largest in Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. . Sparkling Spring Water Limited ("Sparkling Springs") - In April 1997, Clairvest increased its holdings in Sparkling Springs when it purchased 115,800 shares from an existing shareholder for $3.2 million. The purchase increased Clairvest's interest in the company to 34.0 percent (27.5 percent on a fully diluted basis). In June 1997, Sparkling Springs completed a fold-in acquisition in the Portland Portland, town, England Portland, town (1991 pop. 12,945), Dorset, S England. It is on the Isle of Portland, a small rocky peninsula. Portland stone has been used in St. Paul's Cathedral and other important London buildings. Lobsters and crabs are harvested. , Oregon Oregon, city, United States Oregon, city (1990 pop. 18,334), Lucas co., NW Ohio, a suburb adjacent to Toledo, on Lake Erie; inc. 1958. It is a port with railroad-owned and -operated docks. The city has industries producing oil, chemicals, and metal products. region after making its initial entrance into that market in January January: see month. 1997. As a result, Sparkling Springs is now the leading water cooler rental RENTAL. A roll or list of the rents of an estate containing the description of the lands let, the names of the tenants, and other particulars connected with such estate. This is the same as rent roll, from which it is said to be corrupted. company in Portland, as well as the Maritimes, 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 , the United Kingdom. VoxCom Incorporated ("VoxCom") - Subsequent to the end of the first quarter, Clairvest competed the purchase of a $3.0 million convertible debenture 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. from VoxCom. At present Clairvest has $5.0 million invested in VoxCom by way of convertible debentures, which are convertible into approximately 7.4 million common shares, or 30 percent of the outstanding shares of the company. VoxCom is one of Canada's fastest growing security alarm monitoring companies. The funds invested by Clairvest will be used to assist VoxCom in increasing its customer base, both internally and by acquisition. In August 1997, VoxCom completed the acquisition of approximately 9,000 subscribers in the 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 area, increasing its customer base to more than 32,000 subscribers across Canada Across Canada was an afternoon program that formerly aired on The Weather Network. The segment ran from early 1999 until mid 2002. The show ran from 3:00PM ET until 7:00 PM ET. . Western Co-Axial Limited ("Western") - Western's operations continue to benefit from strong subscriber subscriber, n the person, usually the employee, who represents the family unit in relation to the prepayment plan. Other family members are dependents. Also called certificate holders or enrollees. growth, increased service fees and operating synergies from Western's acquisition of Halton Halton is the name of several places In the United Kingdom:
Outlook We have now been working with each of our investment partners for a minimum of six months. The operations of all of our investments are growing, in some cases much faster than anticipated, and we continue to be enthusiastic about the potential for value creation throughout our portfolio. Annual Dividend On July July: see month. 23, 1997, Clairvest paid a dividend of $0.10 per common share to shareholders of record as of July 23, 1997. Financial Statements We herein present consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge , including balance sheets and statements of income, retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. and changes in financial position, as at and for the three months ended June 30, 1997 and 1996. -0- Clairvest Group Inc. is a merchant bank backed by leading Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. entrepreneurs, that invests and assists in the development of carefully selected, high potential companies. It contributes financing and strategic support to accelerate the growth and development of its entrepreneur entrepreneur (än'trəprənûr`) [Fr.,=one who undertakes], person who assumes the organization, management, and risks of a business enterprise. partners in order to create long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. value for shareholders. -0-
Summary of Clairvest's Core Investments
Core Trading Symbol percent Book Value Description
Investment and exchange ownership of of Business
and Investment
accounting ($ millions)
policy
NRI
Industries Private 84 percent $21.6 The North
Consolidation American
leader in
converting
tire-derived
waste rubber
into
value-added,
manufactured
products.
Signature (1) Private 87 percent $10.9 The second
Consolidation largest
electronic
security
company,
serving
Australia and
New Zealand.
Installs,
services and
monitors
security
alarm systems
for
residential
and
commercial
customers.
Datamark (2) DMK - 45 percent $13.0 Provides a
Montreal Equity full range of
products and
services
including
forms, labels,
short- and
medium-run
commercial
printing and
document
management.
Sparkling Private 34 percent $12.1 The largest
Springs Equity purified
water
company,
serving
customers in
British
Columbia;
Atlantic
Canada;
Portland
Oregon, and
the United
Kingdom.
Consoltex(3) CTX - Toronto 31 percent $20.4 A
and Montreal Cost fully-
integrated
North
American
manufacturer
of woven
textile
fabrics
for the
apparel, home
furnishing
and
industrial
markets.
VoxCom (4) VOX - 30 percent $2.1 Sells and
Vancouver Accrued value provides
monitoring
services for
electronic
security
alarm
systems
throughout
Canada.
Western (5) Private 43 percent $16.2 The largest
Accrued value privately-
owned cable
operator in
Canada with
approximately
64,000
subscribers.
(1) Signature Security Group is the combination of two companies -
Signature Security Group Pty. Limited in Australia and Signature
Security Group Limited in New Zealand. Clairvest has an
87.3 percent ownership interest in both companies.
(2) Clairvest owns 4,186,270 common shares of Datamark.
(3) Clairvest owns 5,199,300 subordinate voting shares,
representing 30.5 percent of the outstanding shares, and
17.6 percent of the votes. Book value includes a loan to Les
Gantier B.V., the controlling shareholder of Consoltex
($10.6 million).
(4) Subsequent to June 30, 1997, Clairvest purchased a $3 million
convertible debenture from VoxCom. If both debentures were
converted, subsequent to the purchase, Clairvest would own
approximately 30 percent of the outstanding shares of VoxCom.
(5) Clairvest's investment in Western is by way of convertible
preferred shares and debentures, which if converted would give
Clairvest 42.5 percent of the common equity.
Clairvest Group Inc.
Consolidated Balance Sheets
As at June 30, 1997 and 1996 (Unaudited)
(Thousands of dollars)
1997 1996
-------------------------------------------------------------
ASSETS
CURRENT
Cash and short-term investments $ 5,171 $ 59,674
Accounts receivable 16,975 13,556
Inventories 5,564 4,059
Other assets 6,389 6,283
-------------------------------------------------------------
34,099 83,572
LONG-TERM
Corporate investments
Consoltex Group Inc. 20,445 -
Datamark Inc. 13,012 -
Sparkling Spring Water Limited 12,129 6,080
Voxcom Incorporated 2,085 -
Western Co-Axial Limited 16,221 16,016
Other 6,524 3,415
Fixed assets 50,245 45,678
Other long-term assets 14,925 1,867
-------------------------------------------------------------
$169,685 $156,628
-------------------------------------------------------------
-------------------------------------------------------------
LIABILITIES & SHAREHOLDERS' EQUITY
CURRENT
Bank indebtedness $ 11,341 $ 8,964
Accounts payable 13,841 9,583
Current portion of long-term debt 3,859 5,228
29,041 23,775
-------------------------------------------------------------
LONG-TERM
Long-term debt 27,960 19,836
Other long-term liabilities 876 340
-------------------------------------------------------------
57,877 43,951
-------------------------------------------------------------
MINORITY INTEREST 6,944 6,227
-------------------------------------------------------------
SHAREHOLDERS' EQUITY
Share capital 94,469 94,469
Retained earnings 10,783 11,981
Foreign currency loss (388) -
-------------------------------------------------------------
104,864 106,450
-------------------------------------------------------------
$169,685 $156,628
-------------------------------------------------------------
-------------------------------------------------------------
Clairvest Group Inc.
Consolidated Statements of Income and Retained Earnings
For the three months ended June 30, 1997 and 1996 (Unaudited)
(Thousands of dollars, except per share information)
1997 1996
-------------------------------------------------------------
Sales $ 24,219 $ 16,409
Cost of sales 16,172 12,451
-------------------------------------------------------------
8,047 3,958
Other revenue
Interest and other income 638 1,096
Fees 151 26
Equity accounted income 55 -
Gain on sale of corporate investments 1,599 973
-------------------------------------------------------------
10,490 6,053
-------------------------------------------------------------
Expenses
Operating 5,216 3,024
Depreciation and amortization 2,617 1,554
Interest 1,148 453
-------------------------------------------------------------
8,981 5,031
-------------------------------------------------------------
Operating income before
the undernoted 1,509 1,022
Income taxes (recovery) 354 (44)
-------------------------------------------------------------
Net income before minority interest 1,155 1,066
Minority interest (10) (24)
-------------------------------------------------------------
Net income $ 1,165 $ 1,090
-------------------------------------------------------------
-------------------------------------------------------------
Net income per share $ 0.06 $ 0.06
-------------------------------------------------------------
Fully diluted net income per share $ 0.06 $ 0.06
-------------------------------------------------------------
Weighted average number of
shares outstanding 18,541,590 18,541,590
-------------------------------------------------------------
-------------------------------------------------------------
Retained earnings,
beginning of period $ 11,472 $ 12,745
Net income 1,165 1,090
-------------------------------------------------------------
12,637 13,835
Dividends declared 1,854 1,854
-------------------------------------------------------------
Retained earnings, end of period $ 10,783 $ 11,981
-------------------------------------------------------------
-------------------------------------------------------------
Clairvest Group Inc.
Consolidated Statements of Changes in Financial Position
For the three months ended June 30, 1997 and 1996 (Unaudited)
(Thousands of dollars)
1997 1996
-------------------------------------------------------------
Funds provided from (used for):
Operations
Net income $ 1,165 $ 1,090
Items not affecting funds:
Minority interest (10) (24)
Depreciation and amortization 2,617 1,554
Deferred income taxes 340 (44)
Gain on sale of corporate
investments (1,599) (973)
Equity accounted income (55) -
-------------------------------------------------------------
2,458 1,603
Changes in working capital 3,831 913
-------------------------------------------------------------
6,289 2,516
-------------------------------------------------------------
Financing
Change in long-term debt (4,313) 1,188
Change in other long-term
liabilities (579) -
Foreign exchange loss (244) -
Dividends declared (1,854) (1,854)
-------------------------------------------------------------
(6,990) (666)
-------------------------------------------------------------
Investing
Proceeds from sale of corporate
investment 4,280 1,212
Acquisition of corporate investments (7,247) (5,228)
Net change in corporate investments 1,294 -
Change in minority interest (56) -
Fixed assets (2,912) (2,516)
Other long-term assets (72) 70
-------------------------------------------------------------
(4,713) (6,462)
-------------------------------------------------------------
Funds provided (used) during
the period (5,414) (4,612)
Cash and short-term investments,
net of bank
indebtedness, beginning of period (756) 55,322
-------------------------------------------------------------
Cash and short-term investments,
net of bank indebtedness,
end of period $ (6,170) $ 50,710
-------------------------------------------------------------
-------------------------------------------------------------
CONTACT: Clairvest Group Inc. Jeff Parr, 416/925-9270 ext. 252 or Clairvest Group Inc. Rob Crocker Crock´er n. 1. A potter. , 416/925-9270 ext. 246 |
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