|By Marketwired .||
|March 14, 2014 07:00 AM EDT||
MONTREAL, QUEBEC -- (Marketwired) -- 03/14/14 --
-- Sales of $970.1 million, up 35.2% from $717.5 million last year -- 26.6% growth in operating income to $138.7 million, versus $109.6 million in 2012 -- Net income up 26.6% to $92.5 million, compared to $73.1 million last year -- Diluted EPS of $1.34 versus $1.13 a year ago
Stella-Jones Inc. (TSX:SJ) ("Stella-Jones" or the "Company") today announced financial results for its fourth quarter and fiscal year ended December 31, 2013.
"2013 marked the thirteenth consecutive year of growth for Stella-Jones, as the Company further benefited from its proven expansion strategy. The ongoing growth of our continental network has resulted in improved efficiency of our operations and increased confidence of our customers. By virtue of recent acquisitions and key strategic decisions, Stella-Jones has not only become larger, it has become a stronger and more efficient organization, as well as a lasting source of value creation for its shareholders," said Brian McManus, President and Chief Executive Officer.
---------------------------------------------------------------------------- Quarters ended Years ended Financial highlights Dec. 31, Dec. 31, (in thousands of Canadian dollars, except per share data) 2013 2012 2013 2012 ---------------------------------------------------------------------------- Sales 211,862 159,345 970,149 717,494 Operating income 29,519 21,127 138,699 109,596 Net income for the period 19,690 16,546 92,536 73,070 Per share - basic ($) 0.29 0.25 1.35 1.14 Per share - diluted ($) 0.29 0.25 1.34 1.13 Cash flows from operating activities before changes in non-cash working capital components and interest and income taxes paid 34,607 22,363 160,631 120,797 Cash flows provided by operating activities 23,883 21,086 104,218 28,516 Weighted average shares outstanding (basic, in '000s) 68,693 65,548 68,681 64,312 ----------------------------------------------------------------------------
Sales reached $970.1 million, up 35.2% over last year's sales of $717.5 million. The operating facilities acquired from McFarland Cascade Holdings, Inc. ("McFarland") on November 30, 2012 contributed additional sales of $275.4 million over an eleven-month period in 2013, net of production transferred from other Stella-Jones facilities, while the assets acquired from The Pacific Wood Preserving Companiesa ("PWP") on November 15, 2013 generated sales of approximately $4.1 million in the fourth quarter. The conversion effect from fluctuations in the value of the Canadian dollar, Stella-Jones' reporting currency, versus the U.S. dollar, increased the value of U.S. dollar denominated sales by about $12.9 million when compared with the previous year. Excluding these factors, sales decreased approximately $39.8 million due to a timing effect on railway tie sales resulting from the transition of a Class 1 railroad customer from a treating services only ("TSO") program to a black tie ("Black Tie") program and to the year-over-year timing difference for certain utility pole orders.
Railway tie sales amounted to $394.0 million, compared with $404.5 million last year. This slight decrease reflects the transition of a Class 1 railroad customer from a TSO program to a Black Tie program, which had a timing effect of $30.9 million on 2013 sales. Excluding this factor, railway tie sales rose approximately 5.0%. This transition is mostly complete and should have a minimal impact on results in the first quarter of 2014. Thereafter, annualized sales to that customer should be greater than the aforementioned amount due to more value added under a Black Tie program. Sales of utility poles totalled $405.8 million, up from $218.5 million in 2012. This increase is essentially attributable to additional utility pole sales of $197.9 million from the McFarland operations. Sales of residential lumber reached $112.3 million, up from $35.5 million a year earlier as a result of additional residential lumber sales of $73.8 million from the McFarland operations. Finally, industrial product sales were $58.1 million, compared with $59.0 million a year earlier.
Operating income rose 26.6% to $138.7 million, or 14.3% of sales, versus $109.6 million, or 15.3% of sales, last year. While the increase in monetary terms mainly reflects the addition of the McFarland operations, the reduction as a percentage of sales stems from a less favourable product mix and McFarland's lower margins at the beginning of the year. Reflecting a successful integration, McFarland's margins progressively improved during the year.
Net income for the year increased 26.6% to $92.5 million or $1.34 per share, fully diluted, compared with $73.1 million or $1.13 per share, fully diluted, in 2012. Cash flows from operating activities before changes in non-cash working capital components and interest and income taxes paid rose 33.0% to $160.6 million. Cash flow provided by operating activities was $104.2 million compared to $28.5 million in 2012.
FOURTH QUARTER RESULTS
Sales amounted to $211.9 million, up 33.0% from $159.3 million for the same period a year earlier. The McFarland operations contributed additional sales of $49.3 million, net of production transferred from other Stella-Jones facilities, over a two-month period, while assets acquired from PWP generated sales of $4.1 million. The year-over-year conversion effect from fluctuations in the value of the Canadian dollar, versus the U.S. dollar, increased the value of U.S. dollar denominated sales by $5.8 million. Excluding these factors, sales decreased approximately $6.7 million, as the year-over-year timing difference for certain utility pole orders and the timing effect on sales from the program transition of a Class 1 railroad customer more than offset solid industry demand for railway ties.
Sales of railway ties reached $78.3 million in 2013, versus $73.7 million in 2012. This increase reflects solid market demand, including higher year-over-year advanced deliveries, and the PWP acquisition, partially offset by a timing effect of $13.4 million from the transition of a Class 1 railroad customer to a Black Tie program. Utility pole sales rose $36.9 million to $107.1 million due to a $41.3 million additional net contribution from the McFarland operations over a two-month period and the PWP acquisition. Excluding these factors, sales declined due to the year-over-year timing difference for certain orders. Residential lumber sales reached $13.8 million, up from $5.1 million last year, mainly due to additional sales of $8.1 million from the McFarland operations. Finally, industrial product sales were $12.7 million, versus $10.4 million a year ago, as a result of higher sales of industrial timber for railway bridges.
Operating income was $29.5 million, or 13.9% of sales, versus $21.1 million, or 13.3% of sales, last year. 2013 results include acquisition costs of $1.2 million related to the PWP transaction, while last year's results included acquisition costs of $2.4 million related to the McFarland transaction. Excluding these elements, operating income for the fourth quarter of 2013 was $30.7 million, or 14.5% of sales, compared with $23.5 million, or 14.8% of sales, a year earlier. The variation as a percentage of sales reflects a less favourable year-over-year product mix, partially offset by greater efficiencies throughout the Company's plant network.
Net income for the period rose 19.0% to $19.7 million, or $0.29 per share, fully diluted, compared with $16.5 million, or $0.25 per share, fully diluted, last year. Cash flows from operating activities before changes in non-cash working capital components and interest and income taxes paid reached $34.6 million, up 54.8% from $22.4 million a year earlier.
SOLID FINANCIAL POSITION
As at December 31, 2013, the Company's long-term debt, including the current portion, stood at $372.9 million compared with $349.6 million at the end of the previous year. The increase essentially reflects the additional long-term debt required to finance the acquisition of PWP and the effect of local currency translation on U.S. dollar denominated long-term debt. Despite this acquisition completed shortly before year end, Stella-Jones total debt to total capitalization improved to 0.39:1 as at December 31, 2013, versus 0.44:1 a year earlier.
QUARTERLY DIVIDEND OF $0.07 PER SHARE
On March 13, 2014, the Board of Directors declared a quarterly dividend of $0.07 per common share payable on April 30, 2014 to shareholders of record at the close of business on April 2, 2014.
"As the North American economy continues to strengthen, demand for our core products should remain healthy in 2014. While a stronger economy could result in a tighter market for untreated railway ties and utility poles, as demand for other wood-based products also increases, we believe our inventory position and the strength of our procurement network should allow Stella-Jones to meet demand at the most optimal cost. The integration of the PWP assets will be a key focus in the year ahead. The operating efficiencies we expect to achieve should further strengthen our market penetration and status as a leading provider of treated wood products in our core categories," concluded Mr. McManus.
Stella-Jones will hold a conference call to discuss these results on March 14, 2014, at 10:00 AM Eastern Time. Interested parties can join the call by dialing 647-427-7450 (Toronto or overseas) or 1-888-231-8191 (elsewhere in North America). Parties unable to call in at this time may access a tape recording of the meeting by calling 1-855-859-2056 and entering the passcode 69145418. This tape recording will be available on Friday, March 14, 2014 as of 1:00 PM Eastern Time until 11:59 PM Eastern Time on Friday, March 21, 2014.
NON-IFRS FINANCIAL MEASURES
Operating income and cash flow from operating activities before changes in non-cash working capital components and interest and income tax paid are financial measures not prescribed by IFRS and are not likely to be comparable to similar measures presented by other issuers. Management considers these non-IFRS measures to be useful information to assist knowledgeable investors regarding the Company's financial condition and results of operations as they provide additional measures of its performance.
Stella-Jones Inc. (TSX:SJ) is a leading producer and marketer of pressure treated wood products. The Company supplies North America's railroad operators with railway ties and timbers, and the continent's electrical utilities and telecommunication companies with utility poles. Stella-Jones also provides residential lumber to retailers and wholesalers for outdoor applications, as well as industrial products for construction and marine applications. The Company's common shares are listed on the Toronto Stock Exchange.
Except for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of the Company. These statements are based on suppositions and uncertainties as well as on management's best possible evaluation of future events. Such factors may include, without excluding other considerations, fluctuations in quarterly results, evolution in customer demand for the Company's products and services, the impact of price pressures exerted by competitors, the ability of the Company to raise the capital required for acquisitions, and general market trends or economic changes. As a result, readers are advised that actual results may differ from expected results.
Note to readers: Condensed interim unaudited consolidated financial statements for the fourth quarter and year ended December 31, 2013 are available on Stella-Jones' website at www.stella-jones.com
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lea...
Dec. 9, 2016 12:12 PM EST
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life sett...
Dec. 9, 2016 11:45 AM EST Reads: 7,358
Get deep visibility into the performance of your databases and expert advice for performance optimization and tuning. You can't get application performance without database performance. Give everyone on the team a comprehensive view of how every aspect of the system affects performance across SQL database operations, host server and OS, virtualization resources and storage I/O. Quickly find bottlenecks and troubleshoot complex problems.
Dec. 9, 2016 11:45 AM EST Reads: 2,232
20th Cloud Expo, taking place June 6-8, 2017, at the Javits Center in New York City, NY, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy.
Dec. 9, 2016 11:45 AM EST Reads: 2,370
Application transformation and DevOps practices are two sides of the same coin. Enterprises that want to capture value faster, need to deliver value faster – time value of money principle. To do that enterprises need to build cloud-native apps as microservices by empowering teams to build, ship, and run in production. In his session at @DevOpsSummit at 19th Cloud Expo, Neil Gehani, senior product manager at HPE, discussed what every business should plan for how to structure their teams to delive...
Dec. 9, 2016 11:45 AM EST Reads: 1,534
"We analyze the video streaming experience. We are gathering the user behavior in real time from the user devices and we analyze how users experience the video streaming," explained Eric Kim, Founder and CEO at Streamlyzer, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Dec. 9, 2016 11:45 AM EST Reads: 678
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain. In this power panel at @...
Dec. 9, 2016 11:30 AM EST Reads: 1,004
SYS-CON Events announced today that Fusion, a leading provider of cloud services, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Fusion, a leading provider of integrated cloud solutions to small, medium and large businesses, is the industry’s single source for the cloud. Fusion’s advanced, proprietary cloud service platform enables the integration of leading edge solutions in the cloud, including clou...
Dec. 9, 2016 11:30 AM EST Reads: 526
"MathFreeOn.com is a line coding platform for engineers and scientists. When they want to solve an engineering problem and they have to use software - they have to pay a lot of money for licenses - but with MathFreeOn you don't have to pay a lot of money. Just go to our site and write the code and you can check the result right away," explained Simon Lee, CMO of MathFreeOn, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Cla...
Dec. 9, 2016 11:21 AM EST Reads: 176
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform and how we integrate our thinking to solve complicated problems. In his session at 19th Cloud Expo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and sh...
Dec. 9, 2016 11:00 AM EST Reads: 724
SYS-CON Events announced today that Dataloop.IO, an innovator in cloud IT-monitoring whose products help organizations save time and money, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Dataloop.IO is an emerging software company on the cutting edge of major IT-infrastructure trends including cloud computing and microservices. The company, founded in the UK but now based in San Fran...
Dec. 9, 2016 11:00 AM EST Reads: 705
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...
Dec. 9, 2016 10:30 AM EST Reads: 2,091
"This is specifically designed to accommodate some of the needs for high availability and failover in a network managed system for the major Korean corporations," stated Thomas Masters, Managing Director at InfranicsUSA, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Dec. 9, 2016 10:15 AM EST Reads: 436
@DevOpsSummit at Cloud taking place June 6-8, 2017, at Javits Center, New York City, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long developm...
Dec. 9, 2016 10:15 AM EST Reads: 1,925
Dec. 9, 2016 10:15 AM EST Reads: 1,982