ClubLink Corporation Second Quarter 2001 Report.Business Editors KING CITY, Ontario--(BUSINESS WIRE)--August 13, 2001 ClubLink Corporation Second Quarter 2001 Report
Financial Highlights
For the 3 For the 6
months ended months ended
(THOUSANDS OF DOLLARS July 1, July 2, July 1, July 2,
EXCEPT PER SHARE AMOUNTS) 2001 2000 2001 2000
--------------------------------------------------------------
OPERATIONS
Revenue $ 36,464 $ 32,332 $ 44,873 $ 40,623
Income before interest,
taxes, amortization
and other 12,015 8,715 11,093 7,958
Net income 4,499 3,062 1,675 1,952
Cash flow from operations 6,793 5,187 5,204 5,020
--------------------------------------------------------------
FINANCIAL POSITION
Total assets 513,179 504,417
Total debt (including
convertible debentures) 237,226 235,064
Common shareholders' equity 207,530 210,031
Total debt to common
shareholders'equity ratio 1.14 1.12
--------------------------------------------------------------
PER SHARE DATA
Basic earnings 0.18 0.11 0.00 0.02
Cash flow from operations 0.34 0.24 0.26 0.23
Book value (at end of period) 10.40 10.00
COMMON SHARE DATA (000)
Shares outstanding (at end of period) 19,961 21,000
Weighted average share outstanding 20,149 21,553
--------------------------------------------------------------
Financial Highlights
For the years ended December 31,
(THOUSANDS OF DOLLARS
EXCEPT PER SHARE AMOUNTS) 2000 1999 1998 1997
--------------------------------------------------------------
OPERATIONS
Revenue $ 105,714 $ 92,325 $ 61,304 $ 35,276
Income before interest,
taxes, amortization
and other 25,374 21,713 23,135 11,919
Net income 7,144 7,391 10,626 4,904
Cash flow from operations 14,790 16,966 15,425 10,151
--------------------------------------------------------------
FINANCIAL POSITION
Total assets 489,632 486,702 393,978 207,089
Total debt (including
convertible debentures) 231,851 230,325 196,426 46,811
Common shareholders'
equity 209,632 214,519 159,804 136,350
Total debt to common
shareholders' equity ratio 1.11 1.07 1.23 0.34
--------------------------------------------------------------
PER SHARE DATA
Basic earnings 0.18 0.22 0.58 0.40
Cash flow from operations 0.70 0.80 0.96 0.88
Book value (at end
of period) 10.29 9.85 9.43 8.88
COMMON SHARE DATA (000)
Shares outstanding
(at end of period) 20,364 21,770 16,953 15,355
Weighted average
share outstanding 21,153 21,138 16,019 11,588
---------------------------------------------------------------
Operational Highlights for the 3 months ended July 1, 2001
- Consolidated net income of $4,499,000 or 18 cents per share
increased 46.9% and 63.6%, respectively from $3,062,000 or 11
cents per share in 2000.
- Consolidated cash flow from operations of $6,793,000 or 34
cents per share increased 31.0% and 41.7% from $5,187,000 or 24
cents per share in 2000.
- Consolidated earnings before interest, taxes, amortization and
other of $12,015,000 increased 37.9% from $8,715,000 in 2000.
- Golf Club operating revenue of $28,207,000 increased 14.0% from
$24,744,000 in 2000. Net income from Golf Clubs increased 19.1%
to $9,139,000 from $7,675,000 in 2000. On a same Golf Club
basis, ClubLink realized a 6.0% increase in operating revenue
and a 11.8% increase in club contribution from its Member
Clubs. On its Daily Fee Clubs, ClubLink realized a 14.1%
increase in operating revenue and a 25.1% increase in club
contribution. Both Member and Daily Fee Clubs benefited from a
reduction in same club labour of 1.2% and 1.1% respectively,
offset by significant property tax increases of 182.0% and
87.3% respectively.
- Resort Operations recorded a $210,000 loss compared to loss of
$160,000 in 2000.
- Corporate and unallocated costs were $4,430,000 loss compared
to $4,453,000 in 2000.
Management Discussion and Analysis for the 6 months ended July 1,
2001
- ClubLink has two reportable segments: Golf Club operations
(including the Muskoka Golf Clubs) and Resort operations. The
Golf Club operations segment represents all aspects of
operating golf courses including annual dues, guest, green and
cart fees, merchandise and food and beverage revenue (except
food and beverage at Golf Clubs in Muskoka). On January 8,
2001, Delta Hotels and Resorts Limited assumed operating
management of the non-golf aspects of ClubLink's resort
operations. The Resort operations segment represents all
aspects of operating Delta Muskoka Resorts, including rooms,
food and beverage and nature programs (but exclude golf). All
other operations, including membership fees, marketing and
membership sales, general and administrative, corporate
amortization and taxes are included under Corporate &
Unallocated.
Review of Golf Club Operations
- Golf Club operating revenue of $33,309,000 increased 14.1% from
$29,203,000 in 2000. Net income from Golf Clubs increased 22.7%
to $7,895,000 from $6,433,000 in 2000. This increase was
primarily generated by annual dues from active golf members who
joined since July 2, 2000 and the addition of Rocky Crest,
King's Riding and Greenhills at the beginning of the 2000
season. On a same Golf Club basis, ClubLink realized a 6.6%
increase in operating revenue and a 22.0% increase in club
contribution from its Member Clubs. On its Daily Fee Clubs,
ClubLink realized a 10.0% increase in operating revenue and a
30.3% increase in club contribution. Both Member and Daily Fee
Clubs benefited from a reduction in same club labour of 3.3%
and 5.5% respectively, offset by significant property tax
increases of 44.3% and 35.4% respectively.
- Operating expenses include 6 months of costs at Rocky Crest and
King's Riding Golf Clubs, which opened for play on May 31, 2000
and Greenhills Golf Club, acquired in the first quarter of
2000.
- Amortization of capital assets increased 19.8% to $3,427,000
from $2,861,000 for the same period in 2000 principally due to
a full period of amortization for Rocky Crest, King's Riding,
and Greenhills Golf Clubs.
- Commencing July 2, 2001, operating income will include The Mark
O Meara Course at Grandview in Muskoka, Ontario, Le Maitre at
Mont Tremblant, Quebec, and a second 18-hole golf course at Les
Quatres Domaines in Montreal, Quebec, which opened for play
during June, 2001.
- The existing ClubLink Membership structure was designed eight
years ago to accommodate only four Golf Clubs in Southern
Ontario. Due to the greatly expanded range, variety and
geographic locations of the Golf Clubs, ClubLink redesigned the
structure to accommodate the existing portfolio of Member Clubs
as well as planned future growth. The new structure has four
categories consisting of Prestige, Platinum, Golf and Silver.
Member Clubs have been grouped into each category on July 9,
2001 as follows:
Prestige: King Valley and Greystone
Platinum: Emerald Hills, Grandview, Kanata, King's Riding, The Lake
Joseph Club, Le Maitre, Rocky Crest and Rattlesnake Point
Gold: Blue Springs, Cherry Downs, DiamondBack and Heron Point
Silver: Caledon Woods, Greenhills, Predator at GreyHawk and
Cedarbrook
- ClubLink's 27-hole Daily Fee Bolton Golf Club will close at the
end of the 2001 golf season and is being redesigned by golf
course architect Paul Takahashi into an 18-hole Member Club.
This new course will be named Caledon Woods Golf Club. Caledon
Woods will be a championship layout with bent grass tees,
greens and fairways. The course routing takes full advantage of
the natural features of the site including the picturesque
valley holes, which traverse the Humber River as well as the
rolling terrain and mature forest of Caledon Hills. ClubLink's
newest Member Club will also boast a brand new clubhouse, which
will be sited atop the highest point on the property providing
stunning views of the area. Caledon Woods is scheduled to open
June 1, 2003. Memberships were initially priced at $7,500 and
increased to $8,500 on July 30, 2001. From July 9, 2001, the
date of the announcement through August 8, 2001, ClubLink has
sold 493 Caledon Woods memberships representing committed
membership fees of $3,762,000.
Review of Resort Operations
- Operating revenue includes room rental, food and beverage and
services such as nature programs and recreational activities.
Resort operations exclude golf operations and include all areas
covered under Delta's management contract. Operating revenue
declined 14.3% to $4,315,000 from $5,033,000 in 2000. Net loss
from Resorts increased to $1,569,000 from $1,067,000 in 2000.
- Operating costs have decreased 5.7% to $5,364,000 from
$5,688,000 through management's efforts to control costs.
- Amortization of capital assets increased 26.2% to $520,000 from
$412,000 primarily due to increased amortization arising from
Rocky Crest renovations during January to April 2001.
Corporate Revenue and Unallocated Costs
Membership Revenue
- During the 6 months ended July 1, 2001, ClubLink sold 474 new
memberships with committed membership fees of $9,173,000,
compared to 360 new memberships and $7,939,000 in 2000. These
membership sales, net of resignations and category transfers
increased ClubLink's total active golf Members to 5,285 from
4,944 at December 31, 2000 and 4,191 at July 2, 2000.
- ClubLink recognizes membership fees as revenue upon receipt of
cash. Membership fee revenue recognized in 2001 increased 17.3%
to $7,271,000 from $6,200,000 in 2000.
Marketing and Membership Sales
- Marketing and membership sales costs decreased 12.7% to
$2,088,000 from $2,393,000 in 2000. These costs declined to
4.7% of total revenue for the 6 months ended July 1, 2001
compared to 5.9% in 2000. Marketing and membership sales costs
are recorded as incurred, notwithstanding that the benefit of
certain programs will not be fully realized until subsequent
periods.
General and Administrative Costs
- Gross general and administrative expenses decreased 15.6% to
$4,235,000 from $5,019,000 in 2000 and capitalized general and
administrative expenses declined 42.5% to $471,000 from
$819,000 in 2000. The reduction in gross general and
administrative expenses is due to management s ongoing program
to reduce corporate general and administrative costs.
Amortization of deferred charges
- Amortization of deferred charges decreased 38.5% to $345,000
from $561,000 in 2000. The decrease is primarily due to
deferred Daily Fee golf marketing costs being fully amortized
in 2000.
Interest Expense
- Gross interest expense increased 6.2% to $6,030,000 from
$5,676,000 in 2000 as a result of higher floating rates on a
year over year basis. Interest capitalized to development
projects has declined 24.9% to $1,977,000 from $2,633,000 in
2000.
Interest Income
- Interest income declined 59.5% to $781,000 from $1,929,000.
This decline results primarily from the repayment of
approximately Cdn $32,500,000 of GolfSouth loans at the end of
the first quarter of 2000.
Asset Disposition Program
- On May 7, 2001, ClubLink completed the sale of the Delta Glen
Abbey Conference Centre site for consideration of $7,500,000.
ClubLink has received $7,250,000 in cash and the remaining
$250,000 will be received as the remaining contract obligations
are fulfilled. The Delta Glen Abbey Conference Centre will
commence construction in September 2001 and is projected to be
open in May 2003. On June 29, 2001, ClubLink closed the sale of
the Glen Abbey residential site for $2,169,000. Clublink has
received $434,000 in cash and taken back a mortgage for
$1,735,000. The mortgage will be repaid as homes are sold to
home owners, or on December 31, 2003. Sale proceeds have
reduced ClubLink's investment in the Glen Abbey Golf Club as
these sales were contemplated at time of acquisition. All costs
related to these sales have been capitalized.
- On June 29, 2001, ClubLink closed the sale of the Georgetown
residential site for consideration of $900,000. Clublink has
received $180,000 in cash and taken back a mortgage for
$720,000, the mortgage will be repaid as homes are sold to
homeowners or on June 29, 2006. Sale proceeds from this sale
has reduced ClubLink's investment in the Georgetown Golf Club
as it was contemplated at time of acquisition, in addition, all
costs related to this sale have been capitalized.
- On May 31, 2001, ClubLink closed the sale of a Lake Joseph
Resort Villa. The sale has been recorded at break even.
ClubLink continues to own 11 Lake Joseph Resort Villas.
- ClubLink has executed agreements of purchase and sale for its
Ferndale and King Haven properties and three Lake Joseph Resort
Villas. These sales are expected to close during the third and
fourth quarters of 2001 and the second quarter of 2002.
Liquidity and Capital Resources
- ClubLink finished the quarter in a strong financial position
with working capital excluding prepaid annual dues and deposits
of $12,646,000 plus unutilized lines of credit exceeding
$20,000,000.
- ClubLink's costs to complete properties under construction as
of July 1, 2001 amounted to $17,382,000. These properties will
become operational in June 2002 and June 2003. ClubLink's
capital expenditures for its operating capital assets is
projected to be $3,400,000 for the remainder of 2001. Capital
expenditures are expected to be funded by way of cash flow from
operations, proceeds from the sale of capital assets held for
sale, capital lease lines of credit and, as necessary,
$20,000,000 in undrawn credit facilities.
- On July 9, 2001 Canada Customs and Revenue Agency ( CCRA ) has
issued notices of reassessment in respect of the 4 years ended
December 31, 1997. In dispute is the timing of the recognition
of initiation fees as revenue for income tax purposes. In
accordance with Canadian generally accepted accounting
principles, ClubLink recognizes initiation fees as revenue when
such fees are received and reports its taxable income for
initiation fees on the same basis. CCRA's position is that
initiation fees must be recognized as revenue in the year in
which the membership agreement is entered into on the basis
that all services have been rendered in respect of the
membership at that time. ClubLink and its advisors disagree
with the reassessments and ClubLink intends to file notices of
objection.
ClubLink estimates that the aggregate amount payable for the
period ended December 31, 1997 in respect of taxes that would
have been paid in future years may be up to $8,700,000 for both
federal and provincial income taxes. This would require a
payment to the relevant taxing authorities of not less than
$4,350,000 on or before October 5, 2001. Pending appeal, this
amount will be paid from cash on hand. This payment will not
affect planned capital expenditures. ClubLink has concluded
that the reassessments will not adversely affect earnings in
the current year.
- ClubLink's objective is to ensure capital resources are readily
available to meet its committed capital expenditure program and
to take advantage of favourable acquisition opportunities as
they arise. The Company's capital availability and demonstrated
ability to execute transactions gives it a competitive
advantage in corporate development negotiations. Funds will be
used during the year to continue the acquisition and
development of Golf Club projects, capital expenditures at
operating Golf Clubs and Resorts, to purchase additional
securities pursuant to its normal course issuer bids and to
fund ongoing growth in the normal course of business to enhance
long-term shareholder value.
Investing activities
- Cash flow spent on capital assets declined to $27,484,000 from
$38,758,000 in 2000. This decrease is primarily related to the
acquisition of Greenhills Golf Club in the first quarter of
2000 and a reduced golf course development program. During the
6 months ended July 1, 2001 ClubLink closed the sale of surplus
assets valued at $11,087,000 compared to $2,125,000 in 2000.
- During the 6 months ended July 1, 2001, capital expenditures on
properties under construction amounted to $17,178,000. These
expenditures primarily related to Grandview and Le Maitre Golf
Clubs, which opened for play on in June, 2001, the new 13,600
square foot DiamondBack Clubhouse, The Predator at GreyHawk
golf course scheduled to open in June, 2002, and Caledon Woods
Golf Club, scheduled to open for play in June, 2003. A further
$8,723,000 was spent on capital expenditures for operating Golf
Clubs and Resorts and $1,580,000 spent on properties under
development and held for future development.
- Collections of the GolfSouth and other loans receivable
generated $32,858,000 million during the first quarter of 2000
which contributed to a 59.5% reduction in interest income on a
year over year basis.
Seasonality
- Due to the seasonal nature of the golf and resort business in
the markets the Company currently operates, the second and
third quarters of the fiscal year account for, and are expected
in the future to account for, a greater portion of the
Company's revenue and net income than do the first and fourth
quarters of each fiscal year. This seasonal pattern, as well as
the timing of new Golf Club openings and acquisitions, may
cause the Company's revenue and net income to vary
significantly from quarter to quarter.
ClubLink Corporation
Consolidated Balance Sheets
(THOUSANDS OF DOLLARS -
EXCEPT PER SHARE AMOUNTS) July December
1, 31,
(unaudited) Reference 2001 2000
---------------------------------------------------------------
ASSETS
Current assets
Cash $ 4,998 $ 5,465
Accounts receivable 7,608 2,342
Inventories and prepaid expenses 5,926 2,905
Membership fees receivable 2 7,812 8,178
Loans receivable 3 2,261 1,527
Capital assets held for sale 4 29,789 33,066
--------------------------------------------------------------
58,394 53,483
Membership fees receivable 2 18,537 16,642
Loans receivable 3 15,112 15,540
Long-term portfolio investments 11,231 11,231
Capital assets 4 406,329 388,686
Deferred charges 3,576 4,050
--------------------------------------------------------------
$ 513,179 $ 489,632
==============================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Bank indebtedness $ 5,811 $ -
Accounts payable and accrued
liabilities 19,584 10,424
Long-term debt 8,241 7,710
Capital lease obligations 4,300 4,932
Deferred membership fees 2 7,812 8,178
Prepaid annual dues and deposits 14,025 4,366
--------------------------------------------------------------
59,773 35,610
Long-term debt 110,031 112,212
Capital lease obligations 15,347 12,445
Other long-term liabilities 2,519 2,731
Deferred membership fees 2 18,537 16,642
Convertible debentures 1,731 1,977
Future income taxes 5,946 5,808
--------------------------------------------------------------
213,884 187,425
--------------------------------------------------------------
Shareholders' equity
Convertible debentures 91,765 92,575
Share capital 7 187,426 189,537
Retained earnings 20,104 20,095
--------------------------------------------------------------
299,295 302,207
--------------------------------------------------------------
$ 513,179 $ 489,632
==============================================================
Common shares outstanding 19,961,128 20,364,263
==============================================================
Net book value per share $ 10.40 $ 10.29
==============================================================
SEE ACCOMPANYING NOTES
ClubLink Corporation
Consolidated Statements of Income
(THOUSANDS OF DOLLARS - For the 3 For the 6
EXCEPT PER SHARE AMOUNTS) months ended months ended
July 1, July 2, July 1, July 2,
(unaudited) Reference 2001 2000 2001 2000
---------------------------------------------------------------
REVENUE
Operating $ 31,475 $ 28,759 $ 37,602 $ 34,423
Membership fees 2 4,989 3,573 7,271 6,200
---------------------------------------------------------------
36,464 32,332 44,873 40,623
---------------------------------------------------------------
EXPENSES
Cost of goods sold 4,381 3,830 4,708 4,085
Operating 16,294 15,620 22,643 21,512
Marketing and
membership sales 1,339 1,548 2,088 2,393
General and
administrative 2,134 2,380 3,764 4,200
Provincial
capital taxes 301 239 577 475
--------------------------------------------------------------
24,449 23,617 33,780 32,665
--------------------------------------------------------------
INCOME BEFORE
INTEREST, TAXES,
AMORTIZATION,
AND OTHER 12,015 8,715 11,093 7,958
--------------------------------------------------------------
AMORTIZATION OF
CAPITAL ASSETS 2,292 2,006 4,609 3,846
AMORTIZATION OF
DEFERRED CHARGES 173 283 345 561
INTEREST EXPENSE 2,184 1,473 4,053 3,043
INTEREST INCOME 5 (420) (239) (781) (1,929)
OTHER INCOME 6 - (197) - (987)
--------------------------------------------------------------
4,229 3,326 8,226 4,534
--------------------------------------------------------------
INCOME BEFORE
INCOME TAXES 7,786 5,389 2,867 3,424
--------------------------------------------------------------
INCOME TAX PROVISION
Current 2,679 1,862 1,054 1,178
Future 608 465 138 294
--------------------------------------------------------------
3,287 2,327 1,192 1,472
--------------------------------------------------------------
NET INCOME 4,499 3,062 1,675 1,952
CONVERTIBLE
DEBENTURE INTEREST,
NET OF TAX (830) (805) (1,666) (1,609)
--------------------------------------------------------------
INCOME AVAILABLE
TO COMMON
SHAREHOLDERS 3,669 2,257 9 343
RETAINED EARNINGS,
BEGINNING OF
PERIOD 16,435 14,417 20,095 16,331
--------------------------------------------------------------
RETAINED EARNINGS,
END OF PERIOD $ 20,104 $ 16,674 $ 20,104 $ 16,674
==============================================================
Weighted average
common shares
outstanding 20,148,791 21,552,842
==============================================================
Basic and fully
diluted earnings
per share $ 0.18 $ 0.11 $ 0.00 $ 0.02
==============================================================
SEE ACCOMPANYING NOTES
ClubLink Corporation
Consolidated Statements of Cash Flows
For the 3 For the 6
months ended months ended
(THOUSANDS OF DOLLARS -
EXCEPT PER SHARE AMOUNTS) July 1, July 2, July 1, July 2,
(unaudited) 2001 2000 2001 2000
--------------------------------------------------------------
OPERATING ACTIVITIES
Net income $ 4,499 $ 3,062 $ 1,675 $ 1,952
Add (less) items not
involving cash:
Amortization of
capital assets 2,292 2,006 4,609 3,846
Amortization of
deferred charges 173 283 345 561
Gain on sale of
capital assets - - - (375)
Amortization of US
organizational costs - 129 - 258
Future income taxes 608 465 138 294
Amortization of deferred
debenture interest 51 47 103 93
Convertible debenture
interest-equity portion (830) (805) (1,666) (1,609)
--------------------------------------------------------------
Cash flow from operations 6,793 5,187 5,204 5,020
Accounts receivable (5,436) (2,030) (5,266) 1,207
Inventories and
prepaid expenses (1,784) (1,686) (3,021) (2,833)
Accounts payable and
accrued liabilities 14,300 6,126 9,160 3,226
Prepaid annual dues
and deposits (3,867) (2,091) 9,659 7,483
--------------------------------------------------------------
CASH FLOWS FROM
OPERATING ACTIVITIES 10,006 5,506 15,736 14,103
--------------------------------------------------------------
INVESTING ACTIVITIES
Capital assets (18,422) (19,246) (27,484) (38,758)
Recovery of costs
through real estate
sales and deposits 8,509 - 8,509 2,125
Loans receivable (389) (5,073) (306) 27,785
Long-term investments - (406) - (4,560)
--------------------------------------------------------------
CASH FLOWS FROM
INVESTING ACTIVITIES (10,302) (24,725) (19,281) (13,408)
--------------------------------------------------------------
FINANCING ACTIVITIES
Bank indebtedness 4,712 - 5,811 -
Long-term debt financings - - 415 2,837
Long-term debt
repayments (1,175) (980) (2,065) (1,592)
Capital lease
obligations, net 1,654 2,182 2,270 3,502
Other long-term
liabilities (131) 967 (212) 916
Convertible debentures (764) (162) (803) (8)
Common share issues - - - 799
Common share repurchases (1,209) (3,871) (2,338) (5,630)
--------------------------------------------------------------
CASH FLOWS FROM
FINANCING ACTIVITIES 3,087 (1,864) 3,078 824
--------------------------------------------------------------
NET (DECREASE)
INCREASE IN CASH 2,791 (21,083) (467) 1,519
CASH, BEGINNING OF PERIOD 2,207 37,683 5,465 15,081
==============================================================
CASH, END OF PERIOD $ 4,998 $ 16,600 $ 4,998 $ 16,600
==============================================================
CASH FLOW FROM
OPERATIONS PER SHARE $ 0.34 $ 0.24 $ 0.26 $ 0.23
==============================================================
SEE ACCOMPANYING NOTES
ClubLink Corporation
Notes to Interim Consolidated Financial Statements for the 6
months ended July 1, 2001 and July 2, 2000
1. BASIS OF PRESENTATION
The interim consolidated financial statements of ClubLink
Corporation ( ClubLink ) have been prepared by management in
accordance with accounting principles generally accepted in Canada.
Certain information and disclosures normally required to be
included in notes to annual consolidated financial statements has
been condensed or omitted.
The interim consolidated financial statements have been prepared
following the same accounting policies and methods of computations
as the consolidated financial statements for the year ended
December 31, 2000.
The interim consolidated financial statements should be read in
conjunction with the consolidated financial statements and the
notes contained in ClubLink s annual report for the year ended
December 31, 2000.
2. MEMBERSHIP FEES
For the 6 moths ended
July 1, 2001 July 2, 2000
--------------------------------------------------------------
Active Amount Active Amount
Golf Golf
Members Members
--------------------------------------------------------------
Balance, beginning
of period 4,944 $ 24,820 3,887 $ 20,157
Sales 474 9,173 360 7,939
Resignations (47) (373) (63) (475)
Category transfers (a) (86) - 7 -
Cash received - (7,271) - (6,200)
--------------------------------------------------------------
Balance, end of period 5,285 26,349 4,191 21,421
Less: current portion 7,812 8,720
--------------------------------------------------------------
$ 18,537 $ 12,701
==============================================================
(a) Other membership categories include academy, social, veranda,
junior, non-resident and inactive.
For the year ended
December 31,
(THOUSANDS OF DOLLARS) 2000
--------------------------------------------------------------
Active Golf Amount
Members
--------------------------------------------------------------
Balance, beginning of period 3,887 $ 20,157
Sales 1,170 18,118
Resignations (107) (555)
Category transfers (a) (6) -
Cash received - (12,900)
--------------------------------------------------------------
Balance, end of period 4,944 24,820
Less: current portion 8,178
--------------------------------------------------------------
$ 16,642
==============================================================
(a) Other membership categories include academy, social, veranda,
junior, non-resident and inactive.
3. LOANS RECEIVABLE
July 1, December 31,
(THOUSANDS OF DOLLARS) 2001 2000
--------------------------------------------------------------
Vendor take-back mortgages and loans $ 10,483 $ 7,713
Senior officer loans 902 746
Estimated vendor take-back
loans on capital assets held for sale 5,375 7,953
Other 613 655
--------------------------------------------------------------
17,373 17,067
Less: current portion 2,261 1,527
--------------------------------------------------------------
$ 15,112 $ 15,540
==============================================================
The vendor take-back mortgages and loans have various terms and
are due over varying periods ending in 2009.
The senior officer loans bear interest at 7% per annum, are due in
2006, and were incurred to purchase common shares of the Company.
4. CAPITAL ASSETS
December 31, July 1,
(THOUSANDS 2000 Activity during the 6 months 2001
OF DOLLARS ended July 1, 2001
---------------------------------------------------------------
NET RECOVERY OF AMORTIZATION NET
BOOK COSTS TRANSFERS EXPENSE BOOK
VALUE ADDITIONS THROUGH VALUE
REAL ESTATE
SALES AND
DEPOSITS
---------------------------------------------------------------
Operating
Capital
Assets $339,269 $ 8,726 $ (2,974) $ 45,769 $ (4,609) $ 386,181
---------------------------------------------------------------
Development Assets
Properties under
construc-
tion 35,554 17,178 - (45,769) - 6,963
Properties under
develop-
ment 33,266 1,483 (7,258) - - 27,491
Properties held
for future
develop-
ment 21,616 97 (855) - - 20,858
---------------------------------------------------------------
90,436 18,758 (8,113) (45,769) - 55,312
---------------------------------------------------------------
429,705 27,484 (11,087) - (4,609) 441,493
Capital assets
held for
sale (33,066) (2,350) 5,523 104 (29,789)
Estimated vendor
take-back loans
on assets held
for sale (see
Note 3) (7,953) - 2,578 - - (5,375)
---------------------------------------------------------------
$388,686 $25,134 $(2,986) $- $(4,505) $406,329
===============================================================
Interest of $1,977,000 (2000 - $2,633,000) and project development
and management costs in the amount of $471,000 (2000 - $819,000) have
been capitalized to capital assets under construction during the 6
months ended July 1, 2001.
5. INTEREST INCOME
For the 3 months For the 6 months
ended ended
July 1, July 2, July 1, July 2,
(THOUSANDS OF DOLLARS) 2001 2000 2001 2000
---------------------------------------------------------------
GolfSouth Holdings LLC
and related entities $ - $ (417) $ - $ 833
Membership fees 270 165 392 296
Member accounts 32 28 112 98
Loans receivable and other 118 463 277 702
---------------------------------------------------------------
$ 420 $ 239 $ 781 $ 1,929
===============================================================
6. OTHER INCOME
For the 3 months For the 6 months
ended ended
July 1, July 2, July 1, July 2,
(THOUSANDS OF DOLLARS) 2001 2000 2001 2000
---------------------------------------------------------------
Gain on sale of
marketable securities $ - $ 176 $ - $ 215
Amortization of US
organizational costs - (129) - (258)
Gain on foreign exchange - 150 - 655
Gain on sale of capital
assets - - - 375
---------------------------------------------------------------
$ - $ 197 $ - $ 987
===============================================================
7. SHARE CAPITAL
(a) Authorized and issued share capital
The authorized share capital is an unlimited number of common
shares and preferred shares. As at July 1, 2001 no preferred shares
have been issued.
(THOUSANDS OF DOLLARS) COMMON SHARES AMOUNT
---------------------------------------------------------------
Balance at December 31, 1999 21,770,408 $ 198,188
Purchase of development assets 100,000 748
Exercise of stock options 7,250 49
Purchase and cancellation
of stock subject
to normal course issuer bid (b) (1,513,395) (9,614)
Gain on purchase and cancellation
of 6% convertible debentures
- net of tax - 166
---------------------------------------------------------------
Balance at December 31, 2000 20,364,263 189,537
Purchase and cancellation of
stock subject
to normal course issuer bid (b) (403,135) (2,338)
Gain on purchase and cancellation
of 6% convertible debentures -
net of tax 227
---------------------------------------------------------------
Balance at July 1, 2001 19,961,128 $ 187,426
===============================================================
(b) Normal course issuer bid
During 2000, ClubLink undertook two normal course issuer bids.
Pursuant to the first issuer bid, which expired September 29, 2000,
ClubLink purchased 1,066,820 common shares for a total purchase price
of $6,756,000 or $6.33 per common share. Pursuant to the second issuer
bid, which expires on October 4, 2001, ClubLink purchased 446,575
common shares for a total purchase price of $2,858,000 or $6.40 per
common share in 2000. During the 6 months ended July 1, 2001, pursuant
to the second issuer bid ClubLink purchased a further 403,135 common
shares for a total purchase price of $2,338,000 or $5.80 per common
share.
8. SEGMENTED OPERATIONS
ClubLink has two reportable segments: Golf Club operations
(including the Muskoka Golf Clubs) and Resort operations. ClubLink's
reportable segments are strategic business units that offer different
services and/or products. They are managed separately because each
segment requires different strategies and involves different aspects
of management expertise.
The Golf Club operations segment represents all aspects of
operating golf courses including annual dues, guest, green and cart
fees, merchandise and food and beverage revenue (except food and
beverage at Golf Clubs in Muskoka).
On January 8, 2001, Delta Hotels and Resorts Limited assumed
operating management of the non-golf aspects of ClubLink s resort
operations. The Resort operations segment represents all aspects of
operating Delta Muskoka Resorts, including rooms, food and beverage
and nature programs (but exclude golf).
All other operations, including membership fees, marketing and
membership sales, general and administrative, corporate amortization,
interest and income taxes are included under Corporate & Unallocated.
The accounting policies of the segments are the same as those
described in the summary of significant accounting policies. Any
inter-segment transfers are recorded at cost.
(THOUSANDS OF DOLLARS) 3 months ended July 1, 2001
---------------------------------------------------------------
GOLF CLUB RESORT CORPORATE &
OPERATIONS OPERATIONS UNALLOCATED TOTAL
---------------------------------------------------------------
REVENUE $ 28,207 $ 3,351 $ 4,906 $ 36,464
EXPENSES 17,374 3,301 3,774 24,449
---------------------------------------------------------------
EBITDA 10,833 50 1,132 12,015
OTHER ITEMS 1,694 260 5,562 7,516
---------------------------------------------------------------
NET INCOME (LOSS) $ 9,139 $ (210) $ (4,430) $ 4,499
===============================================================
(THOUSANDS OF DOLLARS) 3 months ended July 2, 2000
---------------------------------------------------------------
GOLF CLUB RESORT CORPORATE &
OPERATIONS OPERATIONS UNALLOCATED TOTAL
---------------------------------------------------------------
REVENUE $ 24,744 $ 3,906 $ 3,682 $ 32,332
EXPENSES 15,570 3,880 4,167 23,617
---------------------------------------------------------------
EBITDA 9,174 26 (485) 8,715
OTHER ITEMS 1,499 186 3,968 5,653
---------------------------------------------------------------
NET INCOME (LOSS) $ 7,675 $ (160) $ (4,453) $ 3,062
===============================================================
(THOUSANDS OF DOLLARS) 6 months ended July 1, 2001
---------------------------------------------------------------
GOLF CLUB RESORT CORPORATE &
OPERATIONS OPERATIONS UNALLOCATED TOTAL
---------------------------------------------------------------
REVENUE $ 33,309 $ 4,315 $ 7,249 $ 44,873
EXPENSES 21,987 5,364 6,429 33,780
---------------------------------------------------------------
EBITDA 11,322 (1,049) 820 11,093
OTHER ITEMS 3,427 520 5,471 9,418
---------------------------------------------------------------
NET INCOME (LOSS) $ 7,895 $ (1,569) $ (4,651) $ 1,675
===============================================================
(THOUSANDS OF DOLLARS) 6 months ended July 2, 2000
---------------------------------------------------------------
GOLF CLUB RESORT CORPORATE &
OPERATIONS OPERATIONS UNALLOCATED TOTAL
---------------------------------------------------------------
REVENUE $ 29,203 $ 5,033 $ 6,387 $ 40,623
EXPENSES 19,909 5,688 7,068 32,665
---------------------------------------------------------------
EBITDA 9,294 (655) (681) 7,958
OTHER ITEMS 2,861 412 2,733 6,006
---------------------------------------------------------------
NET INCOME (LOSS) $ 6,433 $ (1,067) $ (3,414) $ 1,952
===============================================================
9. COMMITMENTS
Costs to complete properties under construction as of July 1, 2001
amount to $17,382,000.
10. COMPARATIVE AMOUNTS
Certain comparative amounts have been reclassified from those
previously presented to conform to the presentation of the 2001
consolidated financial statements.
Board of Directors Senior Officers
ROBERT M. FRANKLIN (1)(3) BRUCE S. SIMMONDS
Chairman of The Corporation President & Chief
Chairman of Placer Dome Inc. Executive Officer
PATRICK S. BRIGHAM (2)(4) SCOTT A. DAVIDSON
President of Hartay Enterprises Inc. Vice President, Systems,
Administration & Retail
CHRISTOPHER J.F. HARROP (1)(3) SUSAN J. HODKINSON
Senior Vice President & Director of Senior Vice President,
Canaccord Capital Corporation Operations & Human Resources
JAMES M. HINCKLEY (2) CHARLES F. LORIMER
Chief Operating Officer of Vice President,
ClubCorp U.S.A., Inc. Business Development & Marketing
MICHAEL W. MANLEY (2)(4) JIM MOLENHUIS
Barrister & Solicitor Vice President, Golf Development
& Turf Operations
BRUCE S. SIMMONDS ROBERT VISENTIN
President & Chief Executive Officer Chief Financial Officer
TERRY A. TAYLOR (4) IAN G. WETHERLY
Executive Vice President & Vice President,
General Counsel Quebec/Eastern Ontario
& Secretary of ClubCorp, Inc.
JACK D. WINBERG (1)(3)
President & Chief Executive Officer
of Rockport Group
(1) AUDIT COMMITTEE
(2) COMPENSATION COMMITTEE
(3) GOVERNANCE COMMITTEE
(4) ENVIRONMENTAL COMMITTEE
Corporate Information
LEGAL COUNSEL HEAD OFFICE
BLAKE, CASSELS & GRAYDON LLP 15675 DUFFERIN STREET
KING CITY, ONTARIO, L7B 1K5
TEL: 905 841-3730
AUDITORS FAX: 905 841-1134
PANNELL KERR FORSTER LLP
TRANSFER AGENT PLEASE VISIT OUR WEB SITE AT
CIBC MELLON TRUST COMPANY WWW.CLUBLINK.CA
LISTINGS
COMMON SHARES - TSE: LNK
6% CONVERTIBLE DEBENTURES - TSE: LNK.DB
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion