HALIFAX, Aug. 7, 2014 /CNW/ - Clarke Inc. ("Clarke" or the "Company")
(TSX: CKI) today announced its results for the three and six months
ended June 30, 2014.
For the three and six months ended June 30, 2014, Clarke generated net
income attributable to equity holders of $19.9 million or $1.00 per
share and $92.9 million or $4.87 per share, respectively. This compared
to net income attributable to equity holders of $7.1 million or $0.43
per share and $10.3 million or $0.62 per share for the same periods in
the prior year. This represents the highest net income generated in a six month period
in the Company's history.
The following were certain key events during the second quarter:
-
The Company's Investment segment had significant increases in the market
value of its marketable securities resulting in total gains of $16.5
million for the three months ended June 30, 2014.
-
Clarke concluded its proxy contest with Sherritt International
Corporation ("Sherritt"). Clarke commenced a proxy contest against
Sherritt in early 2014 with the goal of replacing three directors with
nominees of Clarke and promoting positive change at Sherritt. Although
we were not successful in obtaining board seats, our investment in
Sherritt was a financial success. We sold a portion of our shares of
Sherritt in the second quarter resulting in a realized gain on
marketable securities of $8.1 million. The remainder of our position in
Sherritt was sold subsequent to the end of the second quarter. In
total, Clarke generated a profit of $17.5 million and an IRR of 68% on
its investment in Sherritt.
-
The Company redeemed all of its remaining 2018 convertible debentures.
The Company no longer has any debentures outstanding.
-
The Company sold a real estate holding in Kitchener, Ontario for net
proceeds of $2.1 million, resulting in a gain on sale of $1.5 million.
Clarke's book value at the end of the second quarter was $12.19 per
share. The Company grew book value per share by $3.87 in the first half
of the year while also returning $0.30 per share to shareholders in the
form of dividends. In addition, the Company spent $8.0 million during
the first half of the year repurchasing shares, all at a discount to
book value.
Clarke's Board of Directors also announced the 2014 third quarter
dividend of $0.10 per Common Share payable on October 10, 2014 to
shareholders of record at the end of business on September 30, 2014.
Michael Rapps, Clarke's President and CEO, stated: "Clarke's results in
the first half of 2014 have been great. We look forward to building on
this momentum in coming quarters." Mr. Rapps added "As a result of
selling various investments in recent months we currently have
approximately $77 million of cash on hand. This cash has significant
option value for us as we can act quickly when an investment
opportunity arises. We are currently focused on assisting our portfolio
companies with growing their businesses and identifying new
opportunities to invest in undervalued businesses."
Further information about Clarke, including Clarke's Interim Condensed
Consolidated Financial Statements and Management's Discussion &
Analysis for the three and six months ended June 30, 2014, is available
at www.sedar.com and www.clarkeinc.com.
RESULTS OF OPERATIONS
|
|
|
|
|
(in millions, except per share amounts)
|
Three months
ended
June 30, 2014
$
|
Three months
ended
June 30, 2013
$
|
Six months
ended
June 30, 2014
$
|
Six months
ended
June 30, 2013
$
|
Realized and unrealized gains on marketable securities
|
16.5
|
4.2
|
25.5
|
8.0
|
Dividend income
|
2.3
|
1.3
|
3.8
|
2.6
|
Revenue and other income *
|
5.6
|
2.1
|
11.1
|
3.1
|
Income from continuing operations
|
19.9
|
3.6
|
33.2
|
4.5
|
Income from discontinued operations attributable to equity holders of
the Company**
|
-
|
3.5
|
59.7
|
5.8
|
Net income attributable to equity holders of the Company
|
19.9
|
7.1
|
92.9
|
10.3
|
Comprehensive income attributable to equity holders of the Company
|
19.7
|
7.1
|
88.9
|
12.6
|
Basic earnings per share ("EPS")
|
|
|
|
|
|
Income from continuing operations
|
1.00
|
0.22
|
1.74
|
0.27
|
|
Income from discontinued operations
|
-
|
0.21
|
3.13
|
0.35
|
|
Net income
|
1.00
|
0.43
|
4.87
|
0.62
|
Diluted EPS
|
|
|
|
|
|
Income from continuing operations
|
0.94
|
0.17
|
1.40
|
0.23
|
|
Income discontinued operations
|
-
|
0.14
|
2.46
|
0.24
|
|
Net income
|
0.94
|
0.31
|
3.86
|
0.47
|
Total assets
|
258.6
|
239.4
|
258.6
|
239.4
|
Cash dividends declared per share
|
0.10
|
0.08
|
0.30
|
0.14
|
Book value per share
|
12.19
|
5.77
|
12.19
|
5.77
|
*Revenue and other income includes pension recovery/expense, interest
income, gains/losses on sale of fixed assets, foreign exchange
gains/losses, gains/losses on Debenture redemptions and repurchases and
revenue from the Transportation segment.
**Income from discontinued operations includes the results and the gain
on sale of the Freight Transport Business and Jerico.
About Clarke
Halifax-based Clarke invests in a variety of private and publicly-traded
businesses and participates actively where necessary to enhance the
performance of such businesses and increase its return. Clarke's
securities trade on the Toronto Stock Exchange (CKI); for more
information about Clarke Inc., please visit our website at www.clarkeinc.com.
Note on Forward-Looking Statements and Risks
This press release may contain or refer to certain forward-looking
statements relating, but not limited, to the Company's expectations,
intentions, plans and beliefs with respect to the Company. Often, but
not always, forward-looking statements can be identified by the use of
words such as "plans", "expects", "does not expect", "is expected",
"budget", "estimates", "forecasts", "intends", "anticipates" or "does
not anticipate", "believes", or equivalents or variations of such words
and phrases, or state that certain actions, events or results, "may",
"could", "would", "should", "might" or "will" be taken, occur or be
achieved. Forward-looking statements include, without limitation, those
with respect to the future or expected performance of the Company's
investee companies, the future price and value of securities held by
the Company, changes in these securities holdings, changes to the
Company's hedging practices, currency fluctuations and requirements for
additional capital. Forward-looking statements rely on certain
underlying assumptions that, if not realized, can result in such
forward-looking statements not being achieved. Forward-looking
statements involve known and unknown risks, uncertainties and other
factors that could cause the actual results of the Company to be
materially different from the historical results or from any future
results expressed or implied by such forward-looking statements. Such
risks and uncertainties include, among others, the Company's investment
strategy, legal and regulatory risks, general market risk, potential
lack of diversification in the Company's investments, interest rates,
foreign currency fluctuations, the sale of Company investments, the
fact that dividends from investee companies are not guaranteed,
reliance on key executives, use of information technology and
information systems, commodity market risk, risks associated with
investment in derivative instruments and other factors. With respect to
the Company's Transportation segment, such risks and uncertainties
include, among others, competition, seasonality and weather conditions,
safety, claims and insurance, government regulation of the
transportation industry, reliance on major customers, labour relations,
and other factors.
Although the Company has attempted to identify important factors that
could cause actions, events or results not to be as estimated or
intended, there can be no assurance that forward-looking statements
will prove to be accurate as actual results and future events could
differ materially from those anticipated in such statements. Other than
as required by applicable Canadian securities laws, the Company does
not update or revise any such forward-looking statements to reflect
events or circumstances after the date of this document or to reflect
the occurrence of unanticipated events. Accordingly, readers should not
place undue reliance on forward-looking statements.
SOURCE Clarke Inc.
please contact Michael Rapps, President and CEO, at (416) 855-1925 or Andrew Snelgrove, CFO, at (902) 442-3987.