Tri-White Corporation Announces Third
Quarter 2004 Results and Regular Dividend of $0.06 per
share
Wednesday November 10, 8:23 pm ET
TORONTO, ONTARIO--(CCNMatthews - Nov. 10, 2004) - Tri-White Corporation (TSX:TWH
- News)
Financial Highlights
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Three months ended Year-to-date
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(in thousands of dollars
except per share amounts September September September September
30, 2004 30, 2003 30, 2004 30, 2003
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Revenue 27,046 25,298 42,229 38,368
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EBITDA(1) 17,376 16,934 23,339 21,320
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Interest and other income
(expense) 17 (617) (120) (681)
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Equity earnings 2,626 2,154 2,044 1,289
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Provision for income taxes (7,166) (7,669) (9,252) (8,736)
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Net earnings 12,032 9,959 13,534 10,725
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Earnings per share - basic $0.53 $0.43 $0.59 $0.47
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Weighted average shares
outstanding, on a post
consolidation basis 22,885 22,957 22,885 22,957
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(1) EBITDA is not a recognized performance measure under
Canadian GAAP. EBITDA is defined as earnings before taxes,
interest, depreciation, amortization and earnings from
equity accounted investments. Management believes that
in addition to net earnings, this measure is useful supplemental
information to provide investors with an indication of
income available prior to debt service, capital expenditures
and income taxes. Investors should be cautioned, however,
that this measure should not be construed as an alternative
to net earnings determined in accordance with GAAP as an
indicator of the Company.
TODAY, THE COMPANY ANNOUNCED THE REGULAR DIVIDEND OF
$0.06 PER SHARE TO BE PAID ON DECEMBER 30TH TO SHARHOLDERS
OF RECORD AS AT DECEMBER 10TH.
Third Quarter Operating Highlights
The tourist operations at White Pass and the golf operations
of the Company's equity accounted investment in ClubLink
Corporation ("ClubLink")
are highly seasonal. The majority of the revenue and earnings from these
businesses occur during the third quarter of the year.
Accordingly, the earnings of the
Company will fluctuate with those of the underlying business units.
Commencing in May, the Company's major operating division,
the White Pass & Yukon
Route (the rail tourism and docking segment) opens for the season. Significant
amounts of revenue are generated during this period as cruise ship arrivals
ramp up quickly to support the west coast schedules. Volume peaks during
the third quarter as the majority of North Americans commence
their summer vacations.
Virtually all of the Company's operating income originates
from White Pass, a wholly-owned subsidiary. The results
of the subsidiary, which is deemed
self-sustaining, are translated into Canadian currency using average
rates during the year.
A change in average exchange rates, can impact the net earnings of the
Company.
EBITDA for the three months ended September 30, 2004 was $17.4 million
compared with $16.9 million for the corresponding period in 2003. The
improvement in operating performance relates to an increase in passenger
count for
the
quarter,
driven by improved marketing programs developed at White Pass. Year-to-date,
the total passenger count for the rail excursion was 404,722, an increase
of 16% over the 2003 season. Offsetting the gains in tourist activity
was the
impact of the strengthening Canadian dollar, which is estimated to have
reduced reported EBITDA by $1.7 million.
For the nine months ended September 30th, EBITDA was
$23.3 million, an increase of 9.5% over the prior year.
This is attributed to the growth
in passengers
at the tourist division, where volumes have increased 16% this year.
Tri-White has significant ownership in two public entities,
for which it records income on an equity basis. ClubLink
Corporation ("ClubLink") is Canada's
largest owner, operator and developer of high-quality Member Golf
Clubs, Daily Fee Golf Clubs and Golf Resorts, with 33 golf
courses open for play in 2004.
Like the White Pass port and tourist operations, ClubLink operates
in a highly seasonal market. For the three months ended
September 30, 2004 the Company
recorded equity income of $2.1 million compared to $2.2 million in
the three months ended September 30, 2003. This income
is based on weighted average ownership
of 30.6% and 29.1% for the respective quarters. The Company received
dividends of $0.2 million during the quarter in 2004 and
2003.
The Company also accounts for its investment in Clearlink
("CNK",
formerly MFP Financial Services Ltd.) using the equity method.
CNK is a leading provider of innovative financial solutions
in technology and equipment leasing
and equipment trading. Based in Ontario, CNK operates throughout
North America and Europe. The acquisition of the Company's
34.5% interest in CNK was obtained
in November 2003 and as a result, no equity income was recorded
during the first quarter of 2003. Since CNK has a financial
year-end of March 31, 2004,
the Company has determined that it will record its equity interest
in CNK on a three-month trailing basis. As a consequence,
equity earnings of $0.5 million
were recorded during the third quarter and $1.1 million for the
year-to-date. Clearlink dividends of $0.3 million were
recorded during the quarter.
Long-term investments include 5.4 million shares of ClubLink
carried at $26.7 million and 3.1 million shares of Clearlink
carried at
$25.0 million.
The
market value of these securities exceeds their carrying cost
by $22.0 million at September
30, 2004.
Corporate Developments
Cruise ship capacity in Alaska increased by approximately
5% this season, and the Company's main operating subsidiary,
White
Pass
benefited from
this increase
in demand. The US$1.6 million invested in the spring to increase
coach capacity on its rail excursion enabled the tourist operations
to attain
record performance.
For the 2004 season, which concluded on September 27th, the
rail excursion carried 404,722 passengers, an increase
of 16% from
2003.
On September 8th, 2004, the Company announced the renewal
of its normal course issuer bid providing the Company the
authority
to
purchase, for cancellation,
up to 1,143,587 common shares over the following twelve-month
period. During the third quarter 2004, 10,000 shares were
purchased under
the
plan.
The company continued with its regular quarterly dividend
program and paid a dividend of $0.06 per share, or $1.3
million, on
September 30th.
TRI-WHITE CORPORATION
CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
September 30, 2004
Tri-White Corporation
CONSOLIDATED BALANCE SHEETS
(Unaudited)
As at As at
September 30, December 31,
2004 2003
(in thousands of dollars) Note $ $
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ASSETS
Current
Cash and cash equivalents 8,415 379
Accounts receivable 6,274 204
Loans receivable 6 10,125 -
Income and other taxes recoverable 517 666
Inventories 3,607 4,579
Prepaid expenses and other assets 1,442 1,438
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30,380 7,266
Portfolio investments 4 2,310 4,590
Long-term investments 5 51,727 50,565
Capital assets 7 76,069 75,781
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Total assets 160,486 138,202
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Bank indebtedness 8,817 9,142
Promissory note 8 6,000 -
Accounts payable and accrued
liabilities 4,113 1,461
Income and other taxes payable 6,437 -
Current provision for asset
retirement obligations 85 242
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25,452 10,845
Long term promissory note 9 11,935 11,935
Future income tax liabilities 17,620 17,178
Provision for asset
retirement obligations 83 212
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Total liabilities 55,090 40,170
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Shareholders' equity
Share capital 10 60,969 60,921
Cumulative translation
adjustment (7,457) (5,537)
Retained earnings 51,884 42,648
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Total shareholders' equity 105,396 98,032
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Total liabilities and
shareholders' equity 160,486 138,202
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Tri-White Corporation
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS
(Unaudited)
Three months ended Nine months ended
September September September September
(in thousands of 30, 30, 30, 30,
dollars, except for 2004 2003 2004 2003
per share amounts) Note $ $ $ $
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REVENUE 2 27,046 25,298 42,229 38,368
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Cost of sales and
operating expenses 9,670 8,364 18,890 17,048
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Earnings from
operations before
the undernoted 17,376 16,934 23,339 21,320
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Amortization 821 843 2,477 2,467
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Earnings before
other income
(expense)
and income taxes 16,555 16,091 20,862 18,853
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OTHER INCOME(EXPENSE)
Interest and other 17 153 (281) 89
Net gain (loss) on
sale of investments 4 - (770) 161 (770)
Income on equity
accounted
investments 5 2,626 2,154 2,044 1,289
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2,643 1,537 1,924 608
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Earnings before
income taxes 19,198 17,628 22,786 19,461
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Provision for income
taxes
Current 6,782 4,935 8,481 7,531
Future 384 2,734 771 1,205
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7,166 7,669 9,252 8,736
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Net earnings for the
period 12,032 9,959 13,534 10,725
Retained earnings,
beginning of period 41,265 40,495 42,648 42,662
Dividends paid (1,370) (1,374) (4,114) (4,127)
Excess of purchase
price of common
shares over average
carrying value (43) (69) (184) (249)
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Retained earnings,
end of period 51,884 49,011 51,884 49,011
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Net income per share 10
Basic 0.53 0.43 0.59 0.47
Diluted 0.52 0.43 0.59 0.46
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Tri-White Corporation
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended Nine months ended
September September September September
(in thousands of 30, 30, 30, 30,
dollars, except for 2004 2003 2004 2003
per share amounts) Note $ $ $ $
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OPERATING ACTIVITIES
Net income for the
period 12,032 9,959 13,534 10,725
Items not affecting
cash
Amortization 821 843 2,477 2,467
Future income taxes 384 2,734 771 1,205
Net (gain) loss on
sale of assets and
investments 4 - 770 (161) 770
Income of equity
accounted investments 5 (2,626) (2,154) (2,044) (1,289)
Distributions from
equity accounted
investments 5 497 161 881 482
Net change in operating
assets and liabilities 7,723 7,654 4,136 (365)
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Cash provided by
operating activities 18,831 19,967 19,594 13,995
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FINANCING ACTIVITIES
Promissory note - - 6,000 -
Shares purchased for
cancellation (70) (129) (300) (477)
Dividends paid (1,248) (1,354) (3,950) (4,070)
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Cash provided by
(used in)
financing activities (1,318) (1,483) 1,750 (4,547)
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INVESTING ACTIVITIES
Proceeds on sale of
assets and
investments 4 - 3,474 2,643 11,577
Purchase of capital
assets (1,115) (1,264) (4,536) (5,162)
Purchase of investments - - (202) (5,709)
Advances of loans
receivable 6 (3,125) - (10,125) -
Asset retirement
expenditure (166) (80) (286) (228)
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Cash provided by
(used in) investing
activities (4,406) 2,130 (12,506) 478
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Net effect of currency
translation
adjustment on cash
balances and cash
flows (404) (606) (477) 1,211
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Net increase in cash
and cash equivalents
during the period 12,703 20,008 8,361 11,137
Cash and cash
equivalents,
beginning of period (13,105) (11,401) (8,763) (2,530)
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Cash and cash
equivalents,
end of period (402) 8,607 (402) 8,607
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Represented by
Cash and cash
equivalents 8,415 8,819 8,415 8,819
Bank indebtedness (8,817) (212) (8,817) (212)
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(402) 8,607 (402) 8,607
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Contact:
Tri-White Corporation
Mr. Donald Turple,
Chief Financial Officer
Phone: (416) 367-6877
Fax: (416) 367-6890
One University Avenue, Suite 1400 |
