Leon's Furniture Limited - 2013 Fourth Quarter - NBC Right Now/KNDO/KNDU Tri-Cities, Yakima, WA |

Leon's Furniture Limited - 2013 Fourth Quarter

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SOURCE Leon's Furniture Limited

TORONTO, Feb. 27, 2014 /CNW/ - Leon's Furniture Limited is pleased to announce its results for the full year 2013 and the fourth quarter 2013 including the results of The Brick Limited from March 28, 2013. For the year ended December 31, 2013, total system wide sales were $2,039,428,000 including $344,785,000 franchise sales ($880,240,000 including $198,077,000 franchise sales in 2012). Same store sales were down 1.6% from the prior year. Net income was $67,183,000, $0.95 per common share ($46,782,000, $0.67 per common share in 2012), an increase of 41.8% per share.

For the three months ended December 31, 2013, total system wide sales were $633,871,000, including $110,846,000 of franchise sales ($248,187,000 including $59,725,000 of franchise sales in 2012). Same store corporate sales were down 2.1% from the comparable quarter. Net income was $ 26,034,000, $0.37 per common share ($16,121,000, $0.23 per common share in 2012), an increase of 60.9% per share. The sales and income increase in the fourth quarter and year 2013 when compared to the prior fourth quarter and year 2012, were mainly a result of the inclusion of the operating results of The Brick Limited since March 28, 2013.

While the businesses of Leon's and The Brick continue to operate under their separate banners, the management teams are working closely together to leverage the best practices of each for the benefit of the entire Company. We are pleased with the progress of the integration and our financial results since the acquisition of The Brick Limited. At the same time we continue to identify numerous opportunities that we believe will benefit both our customers and shareholders going forward.

The Directors are pleased to declare a quarterly dividend of 10¢ per common share, payable on April 7, 2014 to the shareholders of record at the close of business on March 7, 2014. Dividends paid by Leon's Furniture Limited are "eligible dividends" pursuant to the changes to the Income Tax Act under Bill C-28, Canada.

EARNINGS PER SHARE FOR EACH QUARTER

  MARCH 31 JUNE 30 SEPT. 30 DEC. 31 YEAR
TOTAL
               
2013 -
-
Basic
Fully
Diluted

20¢
19¢
30¢
27¢
37¢
33¢
$0.95
$0.87
               
2012 -
-
Basic
Fully
Diluted
12¢
12¢
13¢
12¢
19¢
18¢
23¢
22¢
$0.67
$0.65
               
2011 -
-
Basic
Fully
Diluted
15¢
14¢
16¢
15¢
22¢
21¢
28¢
27¢
$0.81
$0.78

LEON'S FURNITURE LIMITED / MEUBLES LEON LTÉE

Mark J. Leon
Chairman of the Board

Leon's Furniture Limited
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(UNAUDITED)
  As at December 31 As at December 31
($ in thousands) 2013 2012
     
ASSETS    
Current assets    
Cash and cash equivalents 5,832 74,949
Restricted marketable securities 20,104 20,980
Available-for-sale financial assets  17,336 125,755
Trade receivables 104,275 27,961
Income taxes receivable - 3,644
Inventories  277,656 86,057
Deferred acquisition costs 1,659 1,271
Deferred financing costs 903 1,317
Total current assets 427,766 341,934
Other assets 4,970 761
Deferred acquisition costs  7,250 1,525
Property, plant and equipment  433,586 218,146
Investment properties  22,304 8,315
Intangible assets  337,221 3,101
Goodwill  440,044 11,282
Deferred income tax assets 7,444 3,114
Total assets 1,680,585 588,178
     
LIABILITIES AND SHAREHOLDERS' EQUITY    
Current liabilities    
Trade and other payables  202,618 73,542
Provisions 4,769  
Income taxes payable 12,135 -
Customers' deposits 93,609 20,386
Finance lease liability  4,302 -
Dividends payable  7,063 7,055
Deferred warranty plan revenue 54,028 14,743
Debentures 15,503 -
Loans and borrowings  50,000 -
Total current liabilities 444,027 115,726
Loans and borrowings  325,255 -
Convertible debentures  90,952 -
Finance lease liability  137,887 -
Deferred warranty plan revenue 85,494 17,251
Redeemable share liability  859 428
Deferred rent liabilities and lease inducements 2,377 -
Deferred income tax liabilities  97,178 2,586
Total liabilities 1,184,030 135,991
     
Shareholders' equity attributable to the shareholders of the Company  
Common shares  27,352 26,693
Equity component of convertible debentures  7,089 -
Retained earnings 462,035 423,099
Accumulated other comprehensive income  79 2,395
Total shareholders' equity 496,555 452,187
Total liabilities and shareholders' equity 1,680,585 588,178

 


Leon's Furniture Limited
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
  Three months ended December 31 Years ended December 31
($ in thousands) 2013 2012 2013 2012
         
Revenue 523,025 188,462 1,694,643 682,163
Cost of sales  289,244 106,625 959,307 398,704
Gross profit 233,781 81,837 735,336 283,459
Operating expenses        
General and administrative expenses 81,543 27,278 267,741 99,346
Sales and marketing expenses 66,979 22,422 213,562 83,479
Occupancy expenses 37,806 8,762 127,985 34,289
Other operating expenses 4,782 2,539 14,562 6,523
Total operating expenses 191,110 61,001 623,850 223,637
Operating profit 42,671 20,836 111,486 59,822
Finance costs  (7,483) - (22,424) -
Finance income 868 1,253 2,494 3,861
Net income before income tax 36,056 22,089 91,556 63,683
Income tax expense 10,022 5,968 24,373 16,901
Net income  26,034 16,121 67,183 46,782
         
Earnings per share        
Basic  $ 0.37  $ 0.23  $ 0.95  $ 0.67
Diluted  $ 0.33  $ 0.22  $ 0.87  $ 0.65
         
         
Weighted average number of common shares outstanding       
Basic 70,626,561 70,312,354 70,612,407 70,032,721
Diluted 81,664,033 72,351,313 79,818,914 72,317,598

 


Leon's Furniture Limited 
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
  Three months ended December 31
      Net of tax
($ in thousands) 2013  Tax effect  2013
       
Net income for the period 26,034 - 26,034
Other comprehensive income, net of tax      
Other comprehensive income to be reclassified to profit or loss in subsequent periods:      
  Unrealized gains on available-for-sale financial assets arising during the period 509 115 394
  Reclassification adjustment for net losses included in profit for the period (245) (64) (181)
  Change in unrealized gains on available-for-sale financial      
     assets arising during the period 265 52 213
Comprehensive income for the period 26,299 52 26,247
      Net of tax
  2012  Tax effect  2012
       
Net income for the period 16,121 - 16,121
Other comprehensive income, net of tax      
Other comprehensive income to be reclassified to profit or loss in subsequent periods:      
  Unrealized gains on available-for-sale financial assets arising during the period 748 97 651
  Reclassification adjustment for net losses included in profit for the period (61) (8) (53)
  Change in unrealized gains on available-for-sale financial      
     assets arising during the period 687 89 598
Comprehensive income for the period 16,808 89 16,719
 
  Year ended December 31
      Net of tax
($ in thousands) 2013  Tax effect  2013
       
Net income for the year 67,183 - 67,183
Other comprehensive income, net of tax      
Other comprehensive income to be reclassified to profit or loss in subsequent years:      
  Unrealized gains on available-for-sale financial assets arising during the year 276 44 232
  Reclassification adjustment for net losses included in profit for the year (2,998) (450) (2,548)
  Change in unrealized losses on available-for-sale financial      
     assets arising during the year (2,722) (406) (2,316)
Comprehensive income for the year 64,461 (406) 64,867
      Net of tax
  2012  Tax effect  2012
       
Net income for the year 46,782 - 46,782
Other comprehensive income, net of tax      
Other comprehensive income to be reclassified to profit or loss in subsequent years:      
  Unrealized gains on available-for-sale financial assets arising during the year 3,183 414 2,769
  Reclassification adjustment for net losses included in profit for the year (311) (41) (270)
  Change in unrealized gains on available-for-sale financial      
     assets arising during the year 2,872 373 2,499
Comprehensive income for the year 49,654 373 49,281
       

 


 

Leon's Furniture Limited
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(UNAUDITED)
($ in thousands) Equity component
of convertible
debenture
Common shares Accumulated other
comprehensive
income (loss)
Retained earnings Total
           
As at  December 31, 2011 - 20,918 (104) 404,647 425,461
           
Comprehensive income          
Net income for the year - - - 46,782 46,782
Change in unrealized gains on available-for-sale  - - 2,499 - 2,499
   financial assets arising during the year          
Total comprehensive income - - 2,499 46,782 49,281
           
Transactions with shareholders          
Dividends declared  - - - (28,047) (28,047)
Management share purchase plan  - 5,778 - - 5,778
Repurchase of common shares - (3) - (283) (286)
Total transactions with shareholders - 5,775 - (28,330) (22,555)
           
As at December 31, 2012 - 26,693 2,395 423,099 452,187
           
As at December 31, 2012 - 26,693 2,395 423,099 452,187
           
Comprehensive income          
Net income for the year - - - 67,183 67,183
Change in unrealized losses on available-for-sale  - - (2,316) - (2,316)
   financial assets arising during the year          
Total comprehensive income - - (2,316) 67,183 64,867
           
Transactions with shareholders          
Dividends declared  - - - (28,247) (28,247)
Issuance of equity component of convertible debt 7,089 - - - 7,089
Management share purchase plan  - 659 - - 659
Repurchase of common shares [note 12] - - - - -
Total transactions with shareholders 7,089 659 - (28,247) (20,499)
           
As at December 31, 2013 7,089 27,352 79 462,035 496,555

 


Leon's Furniture Limited
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
   Year ended December 31 
($ in thousands) 2013 2012
     
OPERATING ACTIVITIES    
Net income for the year 67,183 46,782
Add (deduct) items not involving an outlay of cash    
  Depreciation of property, plant and equipment and investment properties 33,319 14,020
  Amortization of intangible assets 5,630 866
  Amortization of deferred warranty plan revenue (60,664) (16,543)
  Net finance costs 19,930 -
  Deferred income taxes (1,273) 543
  Gain on sale of property, plant and equipment (32) (15)
  (Gain) loss on sale of available-for-sale financial assets (5,462) 121
  Cash paid for deferred financing costs - (1,317)
  58,631 44,457
Net change in non-cash working capital balances related    
  to operations  (39,363) (9,493)
  Cash received on warranty plan sales 63,852 12,940
Cash provided by operating activities 83,120 47,904
     
INVESTING ACTIVITIES    
Purchase of property, plant and equipment  (18,984) (17,897)
Purchase of intangible assets  (6,669) (9)
Proceeds on sale of property, plant and equipment 134 23
Purchase of available-for-sale financial assets (109,674) (467,939)
Proceeds on sale of available-for-sale financial assets 235,260 473,273
Interest received 2,494 -
Purchase of The Brick, net of cash acquired $31,069  (654,954) -
Cash used in investing activities (552,393) (12,549)
     
FINANCING ACTIVITIES    
Repayment of finance leases (2,613) -
Dividends paid (28,239) (38,449)
Repurchase of common shares  - (286)
Repayment of employee loans-redeemable shares 1,090 5,824
Issuance of term loan  400,000 -
Issuance of convertible debentures  100,000 -
Finance costs paid (4,693) -
Repayment of debentures  (19,616) -
Repayment of term loan  (20,000) -
Interest paid (25,773) -
Cash provided by (used in) financing activities 400,156 (32,911)
Net (decrease) increase in cash and cash equivalents    
  during the year (69,117) 2,444
Cash and cash equivalents, beginning of year 74,949 72,505
Cash and cash equivalents, end of year 5,832 74,949

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