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- Acquisitions, same-store sales and operational initiatives combine to
deliver strong results -
WINNIPEG, May 14, 2014 /CNW/ - Boyd Group Income Fund (TSX: BYD.UN)
("the Fund", "the Boyd Group" or "Boyd") today reported its financial
results for the three-month period ended March 31, 2014. The Fund's
first quarter 2014 financial statements and MD&A have been filed on
SEDAR (www.sedar.com). This news release is not in any way a substitute for reading the Boyd
Group's financial statements, including notes to the financial
statements, and Management's Discussion & Analysis.
Q1 2014 Highlights
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Sales increased by 40.6% to $183.6 million from $130.6 million in 2013,
including same-store sales increases of 7.6%.
-
Added 3 single locations during the quarter, with two additional
locations added after March 31.
-
Adjusted EBITDA1 increased 84.0% to $15.0 million, compared with $8.2 million in 2013.
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Adjusted net earnings1 increased to $7.3 million compared with $3.7 million in 2013.
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Subsequent to the end of the quarter, Boyd acquired Collision Revision,
with 25 locations in Illinois, Indiana, and Florida.
"We had a very strong start to 2014 with severe weather conditions, in
contrast to a mild winter in 2013, driving double-digit sales growth in
several of our markets," said Brock Bulbuck, President and Chief
Executive Officer of Boyd Group. "We were also pleased by the positive
impact of our new paint supply agreement on our results, as well as our
continued progress on many operational and growth initiatives."
Financial Results
For the three months ended March 31, 2014
Total sales increased by 40.6% to $183.6 million, compared with sales of
$130.6 million for the same period last year. The $53.0 million
increase was due largely to the contributions from acquisitions of
$21.6 million, incremental sales of $11.5 million from the glass
business, and same-store sales increases, excluding foreign exchange,
of $9.4 million. In addition, Boyd benefited from favourable currency
translation in the amount of $10.7 million from same-store sales
converted at a higher U.S. dollar exchange rate.
Sales in Canada were $20.5 million, an increase of $1.1 million over the
first quarter of 2013. This increase was the result of a $1.2 million
contribution from a new location and same-store sales increases of $0.1
million, or 0.9%, offset by a $0.2 million decrease from the closure of
an underperforming glass facility.
Sales in the U.S. were $163.1 million, an increase of $51.9 million or
46.6%, over the same period in 2013. The increase resulted from
contributions of $9.4 million from 20 new locations, $11.0 million from
25 Hansen Collision and Glass locations, $11.5 million incremental
sales from the glass business, as well as a $9.3 million, or 8.8%,
increase in same-store sales, excluding foreign exchange. Applying
foreign exchange, same-store sales by increased by $10.7 million due to
higher U.S. dollar exchange rates.
Earnings before interest, income taxes, depreciation, amortization,
adjusted for fair value adjustments to financial instruments and acquisition, transaction and process improvement costs ("Adjusted
EBITDA"1) increased to $15.0 million, or 8.2% of sales, compared with Adjusted
EBITDA of $8.2 million, or 6.3% of sales, for the same period a year
ago. The increase in Adjusted EBITDA was primarily the result of EBITDA
contributions from same-store sales improvements and acquisitions
combined with improved gross profit from the new paint supply agreement
and a favourable U.S. dollar exchange rate.
The net loss for the first quarter of 2014 was $1.7 million or $0.112
per unit (fully diluted) compared to net earnings of $30 thousand or
$0.002 per unit (fully diluted) for the same period last year. The
loss was attributable to fair value adjustments to financial
instruments of $7.4 million as well as acquisition, transaction and
process improvement costs, and brand name amortization. Excluding the
impact of these adjustments, adjusted net earnings would have increased
to $7.3 million, or $0.486 per unit. This compares to adjusted net
earnings of $3.7 million, or $0.292 per unit for the same period in
2013. The increase in adjusted net earnings is the result of
acquisition and new location contributions, increases in same-store
sales and improved gross profit from the new paint supply agreement.
During the quarter, the Fund generated adjusted distributable cash of
$10.6 million and declared distributions and dividends of $1.8 million,
resulting in a payout ratio based on adjusted distributable cash of
17.3% for the quarter. This compares with adjusted distributable cash
of $2.4 million, distributions and dividends of $1.5 million, and a
payout ratio of 64.2% a year ago. On a trailing four-quarter basis at
March 31, 2014, the Fund's payout ratio stands at 21.5%.
Outlook
"The first quarter of 2014 once again demonstrated that our growth
strategy, along with our targeted growth goals, remain achievable,"
added Mr. Bulbuck. "We continue to model 6% to 10% growth in single
location additions. We have added five new single locations so far this
year and expect to add a total of 16 to 26 in 2014. Although there is
more competition for larger multi-shop operation ("MSO") acquisitions,
we will maintain our discipline to acquire only those that will be
accretive to the Fund. Our ability to acquire quality MSOs is again
demonstrated by our acquisition of the 25 Collision Revision locations
just last month. Our first quarter same-store sales growth of 7.6%,
while enhanced by some unusual events, demonstrates that we are on
track to take advantage of industry trends to achieve same-store sales
growth. Our strong balance sheet, along with our expanded credit
facility, positions us extremely well for continued growth and
continued investment in our business."
"Looking ahead, we have seen some of the positive impact of the severe
winter weather continue into the second quarter, but we expect that its
impact will continue to diminish as the second quarter progresses. We
therefore expect business conditions to return to more historical norms
by the end of the second quarter."
2014 First Quarter Conference Call & Webcast
Management will hold a conference call on Wednesday, May 14, 2014, at
10:00 a.m. (ET) to review the Fund's 2014 first quarter results. You
can join the call by dialing 888-231-8191 or 647-427-7450. A live
audio webcast of the conference call will be available through www.boydgroup.com. An archived replay of the webcast will be available for 90 days. A
taped replay of the conference call will also be available until
Wednesday, May 21, 2014, at midnight by calling 1-855-859-2056 or
416-849-0833, reference number 30802811.
(¹) EBITDA, Adjusted EBITDA, distributable cash, adjusted distributable
cash and adjusted net earnings are not recognized measures under
International Financial Reporting Standards ("IFRS"). Management
believes that in addition to revenue, net earnings and cash flows, the
supplemental measures of distributable cash, adjusted distributable
cash, adjusted net earnings, EBITDA and Adjusted EBITDA are useful as
they provide investors with an indication of earnings from operations
and cash available for distribution, both before and after debt
management, productive capacity maintenance and non-recurring and other
adjustments. Investors should be cautioned, however, that EBITDA,
Adjusted EBITDA, distributable cash, adjusted distributable cash and
adjusted net earnings should not be construed as an alternative to net
earnings determined in accordance with IFRS as an indicator of the
Fund's performance. Boyd's method of calculating these measures may
differ from other public issuers and, accordingly, may not be
comparable to similar measures used by other issuers. For a detailed
explanation of how the Fund's non-GAAP measures are calculated, please
refer to the Fund's MD&A filing for the period ended December 31, 2013,
which can be accessed via the SEDAR Web site (www.sedar.com).
About The Boyd Group Inc.
The Boyd Group Inc. is the largest operator of non-franchised collision
repair centers in North America in terms of number of locations and one
of the largest in terms of sales. The Company operates locations in
five Canadian provinces under the trade name Boyd Autobody & Glass (http://www.boydautobody.com), as well as in 15 U.S. states under the trade names Gerber Collision &
Glass (http://www.gerbercollision.com), Hansen Collision and Collision Revision. The Company is also a major
retail auto glass operator in the U.S. with locations across 28 U.S.
states under the trade names Gerber Collision & Glass, Glass America,
Auto Glass Services, Auto Glass Only, Auto Glass Authority, S&L Glass
and Hansen Auto Glass. The Company also operates Gerber National Glass
Services, an auto glass repair and replacement referral business with
approximately 3,000 affiliated service providers throughout the U.S.
under the "Gerber National Glass Services" name. For more information
on The Boyd Group Inc. or Boyd Group Income Fund, please visit our
website at (http://www.boydgroup.com).
To view Boyd Group Income Fund's Q1 2014 financial statements and notes,
please click here: http://files.newswire.ca/698/BGIFQ12014.pdf
About The Boyd Group Income Fund
The Boyd Group Income Fund is an unincorporated, open-ended mutual fund
trust created for the purposes of acquiring and holding certain
investments, including a majority interest in The Boyd Group Inc. and
its subsidiaries. The Boyd Group Income Fund units trade on the Toronto
Stock Exchange (TSX) under the symbol BYD.UN. For more information on
The Boyd Group Inc. or Boyd Group Income Fund, please visit our website
at http://www.boydgroup.com.
Caution concerning forward-looking statements
Statements made in this press release, other than those concerning
historical financial information, may be forward-looking and therefore
subject to various risks and uncertainties. Some forward-looking
statements may be identified by words like "may", "will", "anticipate",
"estimate", "expect", "intend", or "continue" or the negative thereof
or similar variations. Readers are cautioned not to place undue
reliance on such statements, as actual results may differ materially
from those expressed or implied in such statements. Factors that could
cause results to vary include, but are not limited to: dependence upon
The Boyd Group Inc. and its Subsidiaries; cash distributions not
guaranteed; inability to successfully integrate acquisitions; economic
downturn; operational performance; rapid growth; loss of key customers;
brand management and reputation; insurance risk; quality of corporate
governance; tax position risk; risk of litigation; acquisition risk;
credit & refinancing risks; dependence on key personnel; employee
relations; decline in number of insurance claims; market environment
change; reliance on technology; weather conditions; expansion into new
markets; fluctuations in operating results and seasonality; increased
government regulation and tax risk; Canadian tax related risk;
execution on new strategies; operating hazards; energy costs; U.S.
health care costs and workers compensation claims; low capture rates;
key supplier relationships; capital expenditures; competition;
potential undisclosed liabilities associated with acquisitions; foreign
currency risk; margin pressure; acquisition and start-up growth and
ongoing access to capital; environmental, health and safety risk;
interest rates; unitholder liability limitation and the Fund's success
in anticipating and managing the foregoing risks.
We caution that the foregoing list of factors is not exhaustive and that
when reviewing our forward-looking statements, investors and others
should refer to the "Risk Factors" section of the Fund's Annual
Information Form, the "Risks and Uncertainties" and other sections of
our Management's Discussion and Analysis of Operating Results and
Financial Position and our other periodic filings with Canadian
securities regulatory authorities. All forward-looking statements
presented herein should be considered in conjunction with such filings.
SOURCE Boyd Group Income Fund
PDF available at: http://stream1.newswire.ca/media/2014/05/14/20140514_C8280_DOC_EN_40291.pdf
