Mr. Jeremy Reitman reports
REITMANS (CANADA) LIMITED ANNOUNCES ITS RESULTS FOR THE SIX MONTHS ENDED JULY 31, 2010
Reitmans (Canada) Ltd.'s sales for the six months ended July 31, 2010, increased 3.3 per cent to $534,631,000, compared with $517,723,000 for the six months ended Aug. 1, 2009. Same-store sales increased by 1.6 per cent. Operating earnings before depreciation and amortization (EBITDA) for the period increased 37.9 per cent to $109,056,000, compared with $79,073,000 last year. The company's gross margin increased from 63.0 per cent to 68.8 per cent in the first six months of fiscal 2011, primarily due to the strengthening of the Canadian dollar vis-a-vis the U.S. dollar. The average rate for a U.S. dollar in the first six months of fiscal 2011 was $1.03 (Canadian), compared with $1.19 (Canadian) in the first six months of fiscal 2010. Net earnings increased 64.6 per cent to $56,346,000, or 83 cents diluted earnings per share, compared with $34,227,000, or 49 cents diluted earnings per share, last year.
Sales for the second quarter ended July 31, 2010, increased 3.3 per cent to $295,653,000, compared with $286,071,000 for the second quarter ended Aug. 1, 2009. Same-store sales for the comparable 13 weeks increased 1.5 per cent. EBITDA for the period increased 33.4 per cent to $71,496,000, compared with $53,613,000 last year. The company's gross margin increased from 63.0 per cent to 69.0 per cent in the second quarter ended July 31, 2010, primarily due to the strengthening of the Canadian dollar vis-a-vis the U.S. dollar. The average rate for a U.S. dollar in the second quarter ended July 31, 2010, was $1.04 (Canadian), compared with $1.13 (Canadian) in the second quarter ended Aug. 1, 2009. Net earnings increased 50.9 per cent to $39,875,000, or 59 cents diluted earnings per share, compared with $26,426,000, or 38 cents diluted earnings per share, for the same period last year.
Sales for the month of August (four weeks ended Aug. 28, 2010) decreased 2.1 per cent compared with August, 2009, with same-store sales decreasing 3.2 per cent.
During the second quarter, the company opened seven new stores comprising two Reitmans stores, one Smart Set store, one RW & Co. store, one Thyme Maternity store and two Cassis stores; 12 stores were closed. Accordingly, at July 31, 2010, there were 977 stores in operation, consisting of 366 Reitmans stores, 161 Smart Set stores, 67 RW & Co. stores, 76 Thyme Maternity stores, 21 Cassis stores, 165 Penningtons stores and 121 Addition Elle stores, compared with a total of 971 stores last year. During the last half of the year, the company plans to open 13 new stores, close six stores and remodel 12 stores.
At the board of directors meeting held on Aug. 31, 2010, a quarterly cash dividend (constituting eligible dividends) of 20 cents per share on all outstanding Class A non-voting and common shares of the company was declared. The dividend is payable on Oct. 28, 2010, to shareholders of record on Oct. 14, 2010.
STATEMENTS OF EARNINGS
(in thousands, except per-share amounts)
Six months ended Three months ended
July 31, Aug. 1, July 31, Aug. 1,
2010 2009 2010 2009
Sales $534,631 $517,723 $295,653 $286,071
Cost of goods sold
and selling,
general and
administrative
expenses 425,575 438,650 224,157 232,458
--------- --------- --------- ---------
109,056 79,073 71,496 53,613
--------- --------- --------- ---------
Depreciation and
amortization 29,912 30,159 15,132 15,513
--------- --------- --------- ---------
Operating earnings
before the
undernoted 79,144 48,914 56,364 38,100
Investment income 1,644 1,407 834 680
Interest on
long-term debt 394 433 195 214
--------- --------- --------- ---------
Earnings before
income taxes 80,394 49,888 57,003 38,566
Income taxes
Current 25,798 16,714 18,103 11,868
Future (1,750) (1,053) (975) 272
--------- --------- --------- ---------
24,048 15,661 17,128 12,140
--------- --------- --------- ---------
Net earnings $56,346 $34,227 $39,875 $26,426
--------- --------- --------- ---------
Earnings per share
Basic $0.84 $0.49 $0.59 $0.38
Diluted 0.83 0.49 0.59 0.38
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