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Jewett-Cameron Announces 2nd Quarter Financial Results
PR Newswire Jewett-Cameron Trading Company Ltd.
19 hours ago
NORTH PLAINS, Ore., April 9, 2014 /PRNewswire/ -- Jewett-Cameron Trading Company Ltd. (JCTCF) today reported financial results for the second quarter and six month periods of fiscal 2014 ended February 28, 2014.

Sales for the second quarter of fiscal 2014 totaled $9.7 million compared to sales of $14.2 million for the second quarter of fiscal 2013. Income from operations was $408,818 compared to income of $979,059 for the quarter ended February 28, 2013. Second quarter 2013 income included the one-time gain of $353,852 related to the sale of property. Net income after other items and income taxes for the current quarter was $237,398, or $0.08 per share, compared to net income of $790,631, or $0.25 per share, in the year-ago quarter.

For the six months ended February 28, 2014, Jewett-Cameron reported sales of $17.7 million compared to sales of $23.5 million for the six months ended February 28, 2013. Net income was $569,977, or $0.18 per share, compared to net income of $1,271,377, or $0.41 per share, in the first six months of fiscal 2013. The year ago period was positively affected by the one-time gain on the sale of property.

"The second quarter and six month results were negatively affected by a delay in our orders from our suppliers caused by manufacturing constraints around Chinese New Year," said CEO Don Boone. "Due to these constraints, shipments to our customers were delayed and also pushed back the rollout of several new products. We do not expect these constraints to continue in the remainder of fiscal 2014."

As of February 28, 2014, the Company's cash position was $5.8 million, and there was no borrowing against its $5.0 million line of credit. In the second quarter of fiscal 2014, the Company repurchased and cancelled 58,180 common shares at a cost of $569,019, which represents an average price of $9.78 per share. Subsequent to the end of the second quarter, the Company re-purchased and is in the process of cancelling a total of 255,313 additional shares of its common stock at a total cost of $2,486,571 at an average price of $9.74 per share. These purchases were pursuant to the Company's share re-purchase plan first announced on January 13, 2014 which has now been completed and terminated. Today the Company's Board of Directors authorized the implementation of a new share repurchase plan under Rule 10b-18. Under the new plan, the Company may purchase for cancellation up to 300,000 common shares, which represents approximately 10.6% of the 2,821,443 common shares currently outstanding. The Company has historically utilized its cash position by implementing share repurchase programs as an effective method of enhancing shareholder value.

About Jewett-Cameron Trading Company Ltd.

Jewett-Cameron Trading Company Ltd. was incorporated in British Columbia on July 8, 1987 as a holding company for Jewett-Cameron Lumber Corporation ("JCLC"), incorporated September 1953. Jewett-Cameron Trading Company, Ltd. acquired all the shares of JCLC through a stock-for-stock exchange on July 13, 1987, and at that time JCLC became a wholly owned subsidiary. Effective September 1, 2013, Jewett-Cameron reorganized certain of its subsidiaries. JCLC's name was changed to JC USA Inc. ("JC USA"), and a new subsidiary, Jewett-Cameron Company ("JCC"), was incorporated. JC USA has the following wholly owned subsidiaries: MSI-PRO Co. ("MSI"), incorporated April 1996, Jewett-Cameron Seed Company, ("JCSC"), incorporated October 2000, Greenwood Products, Inc. ("Greenwood"), incorporated February 2002, and Jewett-Cameron Company ("JCC"), incorporated September 2013. Jewett-Cameron Trading Company, Ltd. and its subsidiaries (the "Company") have no significant assets in Canada.

The Company, through its subsidiaries, operates out of facilities located in North Plains, Oregon. JCC's business consists of the manufacturing and distribution of specialty metal products and wholesale distribution of wood products to home centers and other retailers located primarily in the United States. Greenwood is a processor and distributor of industrial wood products used in a variety of markets and applications, including the marine and transportation markets. MSI is an importer and distributor of pneumatic air tools and industrial clamps in the United States. JCSC is a processor and distributor of agricultural seeds in the United States. JC USA provides professional and administrative services, including accounting and credit services, to its subsidiary companies.

Forward-looking Statements

The information in this release contains certain forward-looking statements that anticipate future trends and events. These statements are based on certain assumptions that may prove to be erroneous and are subject to certain risks, including but not limited to, the uncertainties of the Company's new product introductions, the risks of increased competition and technological change in the Company's industry, and other factors detailed in the Company's SEC filings. Accordingly, actual results may differ, possibly materially, from predictions contained herein.



JEWETT-CAMERON TRADING COMPANY LTD.
CONSOLIDATED BALANCE SHEETS
(Expressed in U.S. Dollars)
(Prepared by Management)
(Unaudited)


February 28,
2014

August 31,
2013




ASSETS







Current assets



Cash
$ 5,816,854

$ 8,308,445
Accounts receivable, net of allowance of $Nil (August 31, 2013 - $Nil)
4,256,286

3,344,777
Inventory, net of allowance of $134,259 (August 31, 2013 - $134,259) (note 3)
7,528,726

8,520,991
Note receivable
-

15,000
Prepaid expenses
2,088,834

587,609
Prepaid income taxes
492,032

270,423




Total current assets
20,182,732

21,047,245




Property, plant and equipment, net (note 4)
2,213,436

2,241,950

Intangible assets, net (note 5)

332,310


368,662




Total assets
$ 22,728,478

$ 23,657,857




LIABILITIES AND STOCKHOLDERS' EQUITY







Current liabilities







Accounts payable
$ 1,190,980

$ 1,715,458
Litigation reserve (note 13(a))
130,854

144,103
Accrued liabilities
765,638

1,149,882




Total current liabilities
2,087,472

3,009,443




Deferred tax liability (note 6)
42,027

50,393




Total liabilities
2,129,499

3,059,836




Contingent liabilities and commitments (note 13)







Stockholders' equity



Capital stock (note 8)



Authorized



21,567,564 common shares, without par value



10,000,000 preferred shares, without par value



Issued



3,076,756 common shares (August 31, 2013 - 3,134,936)
1,451,791

1,479,246
Additional paid-in capital
600,804

600,804
Retained earnings
18,546,384

18,517,971




Total stockholders' equity
20,598,979

20,598,021




Total liabilities and stockholders' equity
$ 22,728,478

$ 23,657,857




JEWETT-CAMERON TRADING COMPANY LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in U.S. Dollars)
(Prepared by Management)
(Unaudited)


Three Month Period
Ended February 28,

Six Month Period
Ended February 28,

2014

2013

2014

2013








SALES
$ 9,732,649

$ 14,227,824

$ 17,738,930

$ 23,524,229








COST OF SALES
7,974,979

11,788,155

14,131,481

19,093,554








GROSS PROFIT
1,757,670

2,439,669

3,607,449

4,430,675








OPERATING EXPENSES







Selling, general and administrative expenses
446,900

468,162

838,786

803,982
Depreciation and amortization
69,531

64,202

139,550

121,696
Wages and employee benefits
832,421

928,246

1,676,371

1,753,553

1,348,852

1,460,610

2,654,707

2,679,231








Income from operations
408,818

979,059

952,742

1,751,444








OTHER ITEMS







Gain on sale of property, plant and equipment
-

353,852

4,109

353,852
Interest and other income
6,612

6,605

13,273

23,315
Interest expense
-

(400)

-

(400)

6,612

360,057

17,382

376,767








Income before income taxes
415,430

1,339,116

970,124

2,128,211








Income tax expense
(178,032)

(548,485)

(400,147)

(856,834)








Net income
$ 237,398

$ 790,631

$ 569,977

$ 1,271,377








Basic earnings per common share
$ 0.08

$ 0.25

$ 0.18

$ 0.41








Diluted earnings per common share
$ 0.08

$ 0.25

$ 0.18

$ 0.41








Weighted average number of common shares outstanding:







Basic
3,129,764

3,135,860

3,132,365

3,135,902
Diluted
3,129,764

3,135,860

3,132,365

3,135,902


JEWETT-CAMERON TRADING COMPANY LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in U.S. Dollars)
(Prepared by Management)
(Unaudited)


Three Month Period
Ended February 28,

Six Month Period
Ended February 28,

2014

2013

2014

2013








CASH FLOWS FROM OPERATING ACTIVITIES







Net income
$ 237,398

$ 790,631

$ 569,977

$ 1,271,377
Items not involving an outlay of cash:







Depreciation and amortization
69,531

64,202

139,550

121,696
Gain on sale of property, plant and equipment
-

(353,852)

(4,109)

(353,852)
Deferred income taxes
(3,802)

137,100

(8,366)

151,423
Interest income on litigation
(6,588)

(6,588)

(13,249)

(13,249)








Changes in non-cash working capital items:







Increase in accounts receivable
(2,018,552)

(4,628,402)

(911,509)

(4,202,382)
Decrease in inventory
846,025

68,731

992,265

1,393,096
Decrease in note receivable
-

-

15,000

20,000
(Increase) decrease in prepaid expenses
(1,205,662)

537,657

(1,501,225)

(1,041,955)
Increase in prepaid income taxes
(448,288)

(253,952)

(221,609)

(253,952)
Increase (decrease) in accounts payable and accrued liabilities

837,196


675,104


(908,722)


(296,125)
Decrease in accrued income taxes
-

(330,957)

-

(37,203)








Net cash used in operating activities
(1,692,742)

(3,300,326)

(1,851,997)

(3,241,126)








CASH FLOWS FROM INVESTING ACTIVITIES







Purchase of property, plant and equipment
(17,457)

(18,657)

(75,375)

(130,790)
Proceeds from sale of property, plant and equipment

-


410,000


4,800


410,000








Net cash provided by (used in) investing activities
(17,457)

391,343

(70,575)

279,210








CASH FLOWS FROM FINANCING ACTIVITIES







Redemption of common stock
(569,019)

(4,884)

(569,019)

(4,884)








Net cash used in financing activities
(569,019)

(4,884)

(569,019)

(4,884)








Net decrease in cash
(2,279,218)

(2,913,867)

(2,491,591)

(2,966,800)








Cash, beginning of period
8,096,072

7,256,455

8,308,445

7,309,388








Cash, end of period
$ 5,816,854

$ 4,342,588

$ 5,816,854

$ 4,342,588
Contact: Don Boone, President & CEO, (503) 647-0110
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