WINNIPEG, Manitoba, June 9, 2021 (GLOBE NEWSWIRE) – (TSX: NWC): The North West Company Inc. (the “Company” or “North West”) reported today its unaudited financial results for the first quarter ended April 30, 2021. It also announced that the Board of Directors has declared a dividend of $ 0.36 per share to shareholders of record on June 30, 2021, to be paid on July 15, 2021.
“Growth continued in our first quarter with some cartels rising strongly, even compared to their exceptional results in the first quarter of 2020. Our cost structure is lower and our retail businesses are more profitable and less volatile as a whole, after the divestment of most of our Giant Tiger stores last year. In addition, our air cargo business achieved another quarter of high utilization, offsetting the current weakness in passenger volumes related to the pandemic, ”commented President and CEO Edward Kennedy. “Our team is coming together as we always have, but even more since the pandemic began, as we actively work on post-pandemic opportunities. Looking towards my retirement on August 1S tI am immensely grateful for the opportunity I have had to be CEO of North West for so long. I have worked closely with Dan McConnell for the past 19 years and, combined with our strong transition process, I have full confidence in his ability to bring great energy and leadership to the role. “
“North West is a company with infinite potential,” commented incoming CEO Dan McConnell. “I am excited about every facet of this opportunity to step up and engage all of Nor’Westers in shaping our future as a trusted and leading company in the communities we serve.”
First quarter sales decreased 7.0% to $ 551.0 million compared to the first quarter of last year, as same-store sales gains were more than offset by the sale and closure of most Giant Tiger stores of the Company last year (the “Giant Tiger Transaction”) and the negative impact of the exchange rate on the translation of sales from International Operations. Excluding the foreign exchange impact, sales decreased 4.1%, with food sales decreased 5.0% and merchandise sales overall decreased 10.6% due to the Giant Tiger Transaction. Based on the same store, sales increased 3.8%1 in addition to a 15.5% increase in the first quarter of last year driven by factors related to COVID-19, including continued spending in the community and government income support for the people, combined with superior stock conditions . Same-store sales of food increased 0.5% based on a 16.3% increase last year and same-store sales of general merchandise increased 23.9% in addition to a 12.0% increase for the year past.
Gross profit decreased 0.9% due to the impact of lower sales partially offset by a 206 basis point increase in the gross profit rate compared to last year. The increase in the gross profit rate was primarily due to favorable changes in the product sales mix and higher inventory turnover that contributed to lower markdowns and inventory shrinkage. These factors were partially offset by the impact of lower margin wholesale food sales to the 36 Giant Tiger stores that were acquired by Giant Tiger Stores Limited as part of the Giant Tiger transaction.
Selling, operating and administrative expenses (“Expenses”) decreased by $ 38.4 million compared to last year and decreased by 487 basis points as a percentage of sales mainly due to non-comparable factors that included a gain of $ 8, 6 million related to insurance this year. , changes in share-based compensation costs, a Giant Tiger store closing provision of $ 9.4 million related to the Giant Tiger Transaction and $ 5.0 million in dismissal costs of Canadian Operations support office employees on last year. Stock-based compensation costs increased $ 3.6 million primarily due to market value adjustments resulting from changes in the company’s share price. Excluding non-comparable factors, expenses decreased $ 19.1 million and decreased 157 basis points as a percentage of sales primarily due to lower store expenses related to the Giant Tiger transaction, a decrease in Canadian administration costs, and lower COVID-related expenses. -19. .
Earnings from operations increased $ 36.8 million to $ 56.3 million compared to $ 19.5 million last year and earnings before interest, income taxes, depreciation and amortization (EBITDAtwo) increased by $ 35.3 million to $ 78.7 million in part due to the impact of Non-Comparable Factors. Adjusted EBITDAtwo, which excludes Non-Comparable Factors, increased $ 15.9 million compared to last year and as a percentage of sales it was 13.7% compared to 10.1% due to the previously mentioned sales, gross profit and expense factors.
Net earnings increased $ 28.0 million to $ 40.3 million. Net earnings attributable to shareholders were $ 39.7 million and diluted earnings per share were $ 0.80 per share compared to $ 0.23 per share last year due to the factors mentioned above. Adjusted net earningstwo, which excludes the after-tax impact of Non-Comparable Factors, increased $ 13.3 million compared to last year driven by earnings from earnings in Canadian Operations and International Operations.
More information on financial results is available in the Company’s Report to Shareholders for the first quarter of 2021, Management’s Discussion and Analysis and the condensed consolidated financial statements of the unaudited interim period that can be found in the section of investors from the Company’s website at www.northwest.ca.
First quarter conference call
North West will host the results of a conference call on June 9, 2021 at 2:00 PM Central Time. To access the call, dial 416-340-2217 or 800-806-5484 with an access code of 5505897. The conference call will be archived and can be accessed by dialing 905-694-9451 or 800-408-3053 with a Access code 2146067 on or before July 10, 2021.
Notice to Readers
Certain forward-looking statements are made in this press release, within the meaning of applicable securities laws. These statements reflect North West’s current expectations and are based on information currently available to management. Words can, will, should, believe, expect, plan, anticipate, intend, estimate, predict, potential, continue, or the negative of these terms, identify prospective issues. These statements speak only as of the date of this press release. Actual results could differ materially from those anticipated in these forward-looking statements.
Forward-looking statements should not be relied upon because they involve known and unknown risks, uncertainties and other factors, which may cause North West’s actual results, performance, capital expenditures or achievements to differ materially from anticipated future results, performance, equity. expenses or achievements expressed or implied in such forward-looking statements, including the Company’s intentions with respect to a normal course issuer offering, the anticipated impact of the COVID-19 pandemic on the Company’s operations and plans for related business continuity of the Company and the realization of the expected savings from the administrative cost reduction plans. Factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to, business performance, fluctuations in interest rates and currency values, legislative and regulatory developments, legal developments, the occurrence of weather conditions. – related natural and other catastrophes, changes in tax laws and the risks and uncertainties detailed in the section entitled Risk Factors in the North West Management Analysis and Analysis and Information Form, both for the year in which ended January 31, 2021. The above list is not an exhaustive list of possible factors. These and other factors should be carefully considered and readers are cautioned not to place undue reliance on these forward-looking statements. North West assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by applicable law.
The North West Company Inc., through its subsidiaries, is a leading retailer of food and everyday products and services for rural communities and urban neighborhoods in Canada, Alaska, the South Pacific and the Caribbean. North West operates 212 stores under the trade names Northern, NorthMart, Giant Tiger, Alaska Commercial Company, Cost-U-Less, and RiteWay Food Markets and has annual sales of approximately CDN $ 2.0 billion.
North West common stock is traded on the Toronto Stock Exchange under the symbol NWC.
For more information contact:
Edward Kennedy, President and CEO of The North West Company Inc.
Telephone 204-934-1482; fax 204-934-1317; email [email protected]
John King, Executive Vice President and Chief Financial Officer of The North West Company Inc.
Telephone 204-934-1397; fax 204-934-1317; email [email protected]
1 Excluding the impact of currencies
two See the non-GAAP measures section of management’s discussion and analysis.