Commercial Announces Strong Earnings Growth: Record Q1 Revenue.EDMONTON Edmonton (ĕd`məntən), city (1991 pop. 616,741), provincial capital, central Alta., Canada, on the North Saskatchewan River. The center of the largest metropolitan area in Alberta, Edmonton, known as the "Gateway to the North," is located , Alberta Alberta (ălbûr`tə), province (2001 pop. 2,974,807), 255,285 sq mi (661,188 sq km), including 6,485 sq mi (16,796 sq km) of water surface, W Canada. -- Commercial Solutions Inc. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :CSA (1) (Canadian Standards Association, Toronto, Ontario, www.csa.ca) A standards-defining organization founded in 1919. It is involved in many industries, including electronics, communications and information technology. ) - 2006 1st Quarter Highlights - Q1 Revenue growth of $9.1 million; a 43.4% increase over the prior period - 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 in the quarter rose to $2.6 million more than 90.0 percent up compared to the prior period - Q1 net earnings up 128.1 percent over prior year to $1.4 million - Basic EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. in Q1 was up 42.9 percent compared to prior period - 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. EPS of $0.09 was achieved Note: EBITDA is defined as 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.
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Three Months Ended Dec. 31
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2005 2004 Change
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Revenue 30,051,902 20,958,577 43.4%
EBITDA 2,631,153 1,384,830 90.0%
Net Earnings 1,399,224 613,519 128.1%
Basic EPS $0.10 $0.07 42.9%
Diluted EPS $0.09 $0.06 50.0%
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Commercial Solutions Inc. ("Commercial" or "Company") (TSX:CSA) a 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. distributor of bearings, power transmission, industrial, safety, survey and resource management equipment products and services, today announced its financial results for the first quarter ended December December: see month. 31, 2005. A complete copy of the Company's report is available on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.sedar.com. Financial highlights from the fiscal 2006 first quarter are as follows: For the three-month period ended December 31, 2005, the Company reported revenues of $30.0 million versus $20.9 million during the same period last year, representing a year-over-year increase of 43.4 percent. For the quarter, the Company reported a 90.0 percent increase in Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) of $2.6 million versus $1.4 million for the same period last year. Net income for the quarter increased 128.1 percent to $1.4 million compared to $0.6 million during the first quarter of fiscal 2005. "We are pleased to report yet another quarter of significant growth at the revenue and earnings line", noted Jim Barker Jim Barker is the General Manager of the Calgary Stampeders. Barker's CFL coaching career began in 1996 as a member of the Montreal Alouettes coaching staff. The Alouettes set a team record for wins, but lost in the Eastern Division Finals to the Toronto Argonauts. , President & 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 Commercial. "The results demonstrate management's ability to grow business organically 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. . During the first quarter, the 2005 acquisition of Impact represented 33.0 percent of our year-over-year growth while organic growth remained strong at 10.0 percent." As at December 31, 2005, the basic average number of shares outstanding was 14,366,291 (16,047,826 diluted) versus 9,343,926 (10,504,682 diluted) at the end of the same period in the prior year. About Commercial Headquartered in Edmonton, Alberta, Commercial is one of Canada's leading independent industrial distributors with 24 Services Centres and approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 266 employees located 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. . Commercial offers more than 160,000 items critical to maintenance to maintenance repair and operations (MRO MRO In currencies, this is the abbreviation for the Mauritanian Ouguiya. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) and original equipment manufacturer (OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and ) customers. The Company represents 450 leading manufacturers and serves over 10,000 customer accounts within a broad cross-section cross section also cross-sec·tion n. 1. a. A section formed by a plane cutting through an object, usually at right angles to an axis. b. A piece so cut or a graphic representation of such a piece. 2. of industries, including oil and gas, forestry forestry, the management of forest lands for wood, water, wildlife, forage, and recreation. Because the major economic importance of the forest lies in wood and wood products, forestry has been chiefly concerned with timber management, especially reforestation, , food processing Food processing is the set of methods and techniques used to transform raw ingredients into food for consumption by humans or animals. The food processing industry utilises these processes. , chemical processing, mining and aggregate, utilities, agriculture and construction. Commercial trades under the symbol "CSA" on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. . For further information on the Company, please visit www.commercialsolutions.ca and for detailed financial information visit www.sedar.com. Forward Looking Statements From time to time, the Company may publish 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. relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc such matters as expected financial performance, business prospects, development activities and like matters. These statements involve risk and uncertainties, including but not limited to the risk factors previously described. Actual results could differ materially from those projected as a result of these risks and should not be relied upon 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 future events. Commercial undertakes no obligation to update any forward-looking statement to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date on which such statement is made, or to reflect the occurrence of unanticipated events.
Consolidated Balance Sheets
December 31 September 30
2005 2005
(unaudited) (audited)
Assets
Accounts receivable $ 19,294,934 $ 18,338,534
Inventory 18,023,197 16,527,643
Prepaids 497,533 546,000
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37,815,664 35,412,177
Deferred costs 104,625 110,590
Future income tax 459,398 813,736
Property and equipment 2,201,794 2,085,741
Property held for sale 725,229 725,229
Intangible assets 1,153,222 1,230,153
Goodwill 11,590,441 11,590,441
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$ 54,050,373 $ 51,968,067
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Liabilities
Bank indebtedness (note 2) $ 3,982,851 $ 4,443,374
Accounts payable and accrued
liabilities 14,069,170 13,157,390
Income taxes payable 1,078,304 834,958
Current portion of deferred tenant
inducement 20,000 20,000
Current portion of long-term debt 1,159,183 1,144,111
Current portion of notes payable 1,137,000 1,182,228
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21,446,508 20,782,061
Deferred tenant inducement 173,333 178,333
Long-term debt 5,359,960 5,657,283
Notes payable 1,016,736 993,801
Preferred shares 968,178 968,178
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28,964,715 28,579,656
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Shareholders' Equity
Common shares (note 3) 17,144,829 16,789,358
Contributed surplus 991,426 1,048,874
Retained earnings 6,949,403 5,550,179
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25,085,658 23,388,411
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$ 54,050,373 $ 51,968,067
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On behalf of the Board:
(signed) (signed)
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Jim Barker, Director Don Caron, Director
Consolidated Statement of Earnings and Retained Earnings
(Unaudited)
Three Months
Ended December 31
2005 2004
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Revenue $ 30,051,902 $ 20,958,577
Cost of goods sold 21,684,481 15,056,394
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Gross margin ($) 8,367,421 5,902,183
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Gross margin (%) 27.8% 28.2%
Expenses
Salaries and benefits 3,752,407 3,024,545
Selling, general & administrative 1,983,861 1,492,808
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5,736,268 4,517,353
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2,631,153 1,384,830
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Interest 50,881 96,285
Interest on long term debt 257,901 213,966
Amortization of property and equipment 131,574 92,048
Amortization of deferred costs 5,965 -
Amortization of intangibles 76,931 -
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523,252 402,299
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Earnings before income taxes 2,107,901 982,531
Income taxes 708,677 369,012
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Net earnings 1,399,224 613,519
Retained earnings, beginning of period 5,550,179 1,850,812
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Retained earnings, end of period $ 6,949,403 $ 2,464,331
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Earnings per share - basic $ 0.10 $ 0.07
Weighted average number of shares 14,366,291 9,343,926
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Earnings per share - diluted $ 0.09 $ 0.06
Weighted average number of shares 16,047,826 10,504,682
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Consolidated Statement of Cash Flows
(Unaudited)
Three Months
Ended December 31
2005 2004
Increase (decrease) in cash and
cash equivalents
Operating
Net earnings $ 1,399,224 $ 613,519
Tennant inducement (5,000) -
Amortization of discount 30,957 -
Amortization 214,470 92,048
Gain on disposal of property and
equipment (7,750) (8,300)
Stock based compensation expense 24,617 37,867
Future income tax expense 354,338 -
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2,010,856 735,134
Changes in non-cash working capital (1,248,360) (1,545,441)
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762,496 (810,307)
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Financing
Banker's acceptances - (1,000,000)
Issuances of common shares, net 273,406 2,048,196
Repayments of long term debt (282,252) (215,611)
Repayments of notes payable (53,250) (53,250)
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(62,096) 779,335
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Investing
Purchase of property and equipment (248,377) (100,646)
Deferred costs - 112,589
Proceeds on disposal of property
and equipment 8,500 21,700
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(239,877) 33,643
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Increase in cash and cash
equivalents during the period 460,523 2,671
Cash and cash equivalents (note 2)
Beginning of period (943,374) (2,051,295)
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End of period $ (482,851) $ (2,048,624)
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Commercial Solutions Inc. (TSX:CSA) |
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