Mr. Jack Benne reports
BEVO AGRO INC. REPORTS ON FISCAL 2016 RESULTS
Bevo Agro Inc. has released its operating and financial results for the fiscal year ending June 30, 2016.
Major 2016 highlights:
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Four consecutive quarters reporting record sales;
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CubicFarm Systems Corp. formed to provide the very best in cubic farming systems;
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Construction of an additional eight-acre greenhouse to be operational in the fall of 2016.
Fiscal 2016 highlights (versus 2015):
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Celebrated the company's 30th anniversary with sales exceeding $31-million, a 19-per-cent increase over 2015 sales;
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Net earnings totalled $2,825,603, compared with $1,197,556, a 136-per-cent increase;
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Earnings per share of 11 cents, compared with five cents;
- Earnings before interest, taxes, depreciation and amortization (EBITDA) of $5,806,890, compared with $4,078,579, an increase of 42 per cent.
Fourth quarter highlights (2016 versus 2015):
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Sales of $13.1-million, compared with $11-million, a 19-per-cent increase in the fourth quarter;
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Net earnings of $1.7-million, compared with $881,000, a 93-per-cent increase;
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EBITDA of $2.35-million, compared with $1.76-million, an increase of 33 per cent.
Bevo Agro's net earnings increased by 136 per cent to $2,825,603 for the year ending June 30, 2016, compared with the previous-year earnings of $1,197,556. Net earnings for the fourth quarter were $1,700,264, an increase of 93 per cent over net earnings of $881,968 in the fourth quarter of last year.
Bevo experienced record sales for the year ending June 30, 2016, of $31,167,250, an increase of 19 per cent over sales of $26,221,677 for the year ended June 30, 2015. Sales for the fourth quarter rose by 19 per cent to $13,110,528 from $11,000,578 in the fourth quarter of last year and increased for the fourth consecutive quarter. The increase in sales was due to improved utilization of existing greenhouse areas and increased customer plant requirements. The additional eight acres of greenhouse space will be used to meet increased orders from the company's present customers.
The gross profit was $8,610,294 (28 per cent of sales) for the year ending June 30, 2016, compared with 6,801,354 (26 per cent of sales) for fiscal 2015. Gross profit for the fourth quarter of fiscal 2016 was $3,289,134 (25 per cent), compared with $2,653,536 (24 per cent) for the same quarter last year.
Earnings before interest, taxes, depreciation and amortization increased by 42 per cent to $5,806,890 for the year ending June 30, 2016, compared with EBITDA of $4,078,579 for the previous year. EBITDA for the fourth quarter of fiscal 2016 was $2,351,272, a 33-per-cent improvement over EBITDA of $1,763,564 for the same quarter last year.
Operating expenses totalled $1,590,505 for the fourth quarter, compared with $1,570,248 for the same quarter last year. The total operating expenses totalled $5,390,936 for the 12 months ending June 30, 2016, virtually unchanged from total operating expenses of $5,359,549 in the previous year.
Bevo Agro maintains a balance of fixed and floating rates on borrowings as a hedge against interest rate fluctuations. From a balance sheet perspective, the company maintains sufficient working capital to manage its business and to maintain conservative financial ratios.
Readers are encouraged to view the company's audited financial statements at June 30, 2016, and accompanying management's discussion and analysis on SEDAR.
SUMMARY -- CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
For the year ending
June 30, 2016 June 30, 2015
Sales $31,167,250 $26,221,677
Cost of sales $22,556,956 $19,420,323
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Gross margin $8,610,294 $6,801,354
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Expenses
General operating $1,298,808 $1,365,615
Employee benefits $1,504,596 $1,425,111
Amortization $1,811,220 $1,713,009
Interest expenses $776,312 $855,814
Total expenses $5,390,936 $5,359,549
Earnings from operations $3,219,358 $1,441,805
Other $67,951
Earnings before taxes $3,219,358 $1,509,756
Income taxes -- future $393,755 $312,200
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Net earnings for the period $2,825,603 $1,197,556
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EBITDA $5,806,890 $4,078,579
Earnings per share $0.11 $0.05
For the three months ending
June 30, 2016 June 30, 2015
Sales $13,110,528 $11,000,578
Cost of sales $9,821,394 $8,347,042
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Gross margin $3,289,134 $2,653,536
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Expenses
General operating $329,000 $386,348
Employee benefits $608,862 $503,624
Amortization $466,996 $459,381
Interest expenses $185,647 $220,895
Total expenses $1,590,505 $1,570,248
Earnings from operations $1,698,629 $1,083,288
Income taxes -- future ($1,635) $201,320
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Net earnings for the period $1,700,264 $881,968
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EBITDA $2,351,272 $1,763,564
Bevo's year-over-year comparative results are summarized in the attached table.
Year ended June 30,
2013 2014 2015 2016
Sales $20,587,204 $23,309,085 $26,221,677 $31,167,250
Gross margin $5,083,066 $5,918,741 $6,801,354 $8,610,294
Earnings (loss) from operations $139,619 $903,856 $1,441,805 $3,219,358
Net earnings (loss) for period $184,533 $738,745 $1,197,556 $2,825,603
Bevo Agro is North America's leading supplier of propagated agricultural plants, operating greenhouse facilities in Langley, B.C., and Pitt Meadows, B.C. The company's main products are the propagation of vegetable plants such as tomatoes, peppers, cucumbers, and other plants such as bedding plants, flowers and grasses. The company markets its products to established greenhouse growers, nurseries and retail outlets throughout North America.
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