MONTREAL, QUEBEC, JANUARY 18, 2005 - MAAX Corporation (MAAX), successor in interest to MAAX Inc., today announced its results for the third quarter and the nine-month period ended November 30, 2004. With effect from the beginning of the 2005 fiscal year, MAAX has adopted the U.S. dollar as its financial reporting currency. Accordingly, financial statements are presented in U.S. dollars and the previous year has been restated to reflect these changes. All amounts set out below are in U.S. dollars unless otherwise indicated. The consolidated financial statements set out below have been prepared in accordance with generally accepted accounting principles in the United States for interim financial information. They also include the accounts of MAAX Inc. and all its subsidiaries up to June 3, 2004 and those of MAAX Corporation and all its subsidiaries effective June 4, 2004. On June 4, 2004, MAAX Corporation acquired all the issued and outstanding common shares of MAAX Inc. The transaction was paid by a capital contribution by the shareholders, for a consideration of $133,688,000, and by the issuance of long-term debt, for a consideration of $373,282,000.
THIRD-QUARTER RESULTS
During the three-month period ended November 30, 2004, MAAX achieved net sales of $133.5 million, compared with $126.8 million in the third quarter of the previous fiscal year. All business sectors contributed to this growth of $6.6 million or 5.2%, especially the spa and kitchen sectors which posted respective increases of 22.0% and 14.8%. Net sales of bathroom products rose 2.3%; strong demand from retailers and the Canadian market in general was largely offset by the impact of discontinued business with U.S. home improvement centers. Without the impact of fluctuations in the U.S. dollar in relation to the Canadian dollar and certain non-recurring items, consolidated and bathroom net sales would have been up respectively by 8.2% and 5.6% over the third quarter last year.
Adjusted EBITDA totaled $16.0 million in the third quarter, down by 16% or $3 million from the same period last year. That works out to a margin of 12.0% as a percentage of total sales, compared with 15.0% last year. This decline in the adjusted EBITDA margin was mainly due to the sharp rise in raw material costs across all sectors, unfavourable sales mix in our Bathroom Sector and labour inefficiencies resulting from plant consolidation and transition at some of our plants .
Free cash flow (defined as cash flow related to operating activities less net additions to property, plant and equipment) fell slightly to $17.9 million, down from $19.0 million, as the decline in operating income was largely offset by the improvement in working capital and reduction in capital expenditures.
Head Office 1010 Sherbrooke St. West, Suite 1610, Montreal, Quebec H3A 2R7 Tel: (514) 844-4155 Fax: (514) 895-4155
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During the first nine months of fiscal 2005, net sales grew by $24.9 million or 6.5% to $405.7 million. Excluding the impact of fluctuations in the U.S. dollar in relation to the Canadian dollar and certain non-recurring items, consolidated net sales for the first three quarters posted organic growth of 9.1% over the previous year. All three sectors contributed to this increase: net sales of bathroom products rose 6.6%, whereas those of spas grew by 4.1% and those of kitchen cabinets by 9.3%. Adjusted EBITDA totaled $58.6 million for a margin of 14.4% during the first nine months of fiscal 2005, compared with $55.6 million and a margin of 14.6% a year earlier.
Year-to-date free cash flow amounted to $19.8 million, compared with $39.2 million last year. Excluding non-recurring transaction related disbursements of $10.6 million, adjusted free cash flow totaled $30.4 million.
"The fundamentals remain positive as indicated by the sales growth in each of our three sectors. Moreover, we also continued to gain market share in all our core business segments. Finally, we will take all necessary measures to minimize the impact on our profitability of the higher cost of several key raw materials used in manufacturing our products," indicated Andre Heroux, President and Chief Executive Officer of the Corporation.
FINANCIAL POSITION
Following the acquisition of MAAX Inc. on June 4, 2004, shareholders made a $133.7 million capital contribution and MAAX Corporation issued $373.3 million in long-term debt (see notes 2 and 5 to the consolidated financial statements herein). As at November 30, 2004, total net debt amounted to $355.7 million, whereas shareholders' equity and total assets stood at $164.9 million and $658.6 million respectively. MAAX showed a total debt to trailing 12-month adjusted EBITDA ratio of 4.93X versus 5.20X on June 4, 2004.
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CONFERENCE CALL
A conference call will be held exclusively for MAAX Corporation's subordinated note holders and landers at 10:00 a.m. Eastern time on Tuesday, January 18, 2005 to review and discuss the results for the first three quarters of the current fiscal year's.
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quote:Originally posted by amanick1: i just bought 20k im hoping it does something lol
at what price did you buy??? I got in at .10 went up t0 .15, but didn't think i't would drop so rapidly....oh well only down 20%....she'll be back...
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posted
got in at 10 sold at 20 and bought more at 15 buying on the dips and holding for a few more days see what next week brings at worst if i loose I will sit on it till eternity lol. what goes up must come down and bounce
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