Jewett-Cameron Announces 1st Quarter Financial Results

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Jan 14, 2022, 16:45 ET

NORTH PLAINS, Ore., Jan. 14, 2022 /PRNewswire/ -- Jewett-Cameron Trading Company Ltd. (NASDAQ: JCTCF) today reported financial results for the first quarter of fiscal 2022 ended November 30, 2021.

Sales for the first quarter of fiscal 2022 totaled $12.9 million compared to sales of $10.3 million for the first quarter of fiscal 2021. Net loss for the current quarter was ($391,141), or ($0.11) per share, compared to net income of $488,527, or $0.14 per share, in the year-ago quarter.

"Our sales quarter over quarter increased by 25%, reflecting the continued strong demand for our products, but higher costs for raw materials and global logistical issues significantly reduced our margins," said CEO Chad Summers. "In response, we have now successfully increased our selling prices with our customers, but these inflationary pressures will remain an issue affecting our margins throughout fiscal 2022."

As of November 30, 2021, the Company's cash position was approximately $1.2 million, and there was $5.0 million borrowed against its $10.0 million line of credit. Based on the timing of accounts receivable and the unused portion of the line of credit, the Company believes it has sufficient working capital available for the remainder of fiscal 2022.

Jewett-Cameron Trading Company is a holding company that, through its subsidiaries, operates out of facilities located in North Plains, Oregon. Jewett-Cameron Company's business consists of the manufacturing and distribution of patented and patent pending specialty metal products, wholesale distribution of wood products, and seed processing and sales. The Company's brands include Lucky Dog®, for pet products; Adjust-A-Gate™, Fit-Right®, Perimeter Patrol®, and Lifetime Post™ for gates and fencing; and Early Start, Spring Gardner™, Greenline®, and Weatherguard for greenhouses. Additional information about the Company and its products can be found the Company's website at www.jewettcameron.com.

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)
	November 30,2021		August 31,2021

ASSETS
Current assets
Cash and cash equivalents	$	1,235,445	$	1,184,313
Accounts receivable, net of allowance of $0 (August 31, 2021 - $0)		5,806,987		7,086,503
Inventory, net of allowance of $250,000 (August 31, 2021 - $250,000)		17,223,927		14,391,365
Prepaid expenses		2,267,341		2,305,820
Prepaid income taxes		355,163		252,958

Total current assets		26,888,863		25,220,959

Property, plant and equipment, net		4,407,548		3,886,543

Intangible assets, net		30,629		30,897

Total assets	$	31,327,040	$	29,138,399

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities

Accounts payable	$	2,084,438	$	1,349,677
Bank indebtedness		5,000,000		3,000,000
Accrued liabilities		1,594,834		1,798,088

Total current liabilities		8,679,272		6,147,765

Deferred tax liability		125,834		116,945

Total liabilities		8,805,106		6,264,710

Stockholders' equity
Capital stock Authorized 21,567,564 common shares, no par value 10,000,000 preferred shares, no par value Issued 3,492,842 common shares (August 31, 2021 –3,489,161)		824,039		823,171
Additional paid-in capital		725,729		687,211
Retained earnings		20,972,166		21,363,307

Total stockholders' equity		22,521,934		22,873,689

Total liabilities and stockholders' equity	$	31,327,040	$	29,138,399

JEWETT-CAMERON TRADING COMPANY LTD. CONSOLIDATED STATEMENTS OF OPERATIONS (Expressed in U.S. Dollars) (Prepared by Management) (Unaudited)
	Three Months Ended November 30, 2021		Three Months Ended November 30, 2020

SALES	$	12,917,724	$	10,316,284

COST OF SALES		10,452,861		7,353,385

GROSS PROFIT		2,464,863		2,962,899

OPERATING EXPENSES
Selling, general and administrative expenses		988,288		694,628
Depreciation and amortization		69,638		50,529
Wages and employee benefits		1,874,118		1,593,959

		2,932,044		2,339,116

(Loss) income from operations		(467,181)		623,783

OTHER ITEMS
Other income		3,000		3,000
Interest expense		(20,276)		-

Total other items		(17,276)		3,000

(Loss) income before income taxes		(484,457)		626,783

Income tax recovery (expense)		93,316		(138,256)

Net (loss) income	$	(391,141)	$	488,527

Basic (loss) earnings per common share	$	(0.11)	$	0.14

Diluted (loss) earnings per common share	$	(0.11)	$	0.14

Weighted average number of common shares outstanding:
Basic		3,491,103		3,481,162
Diluted		3,491,103		3,481,162

JEWETT-CAMERON TRADING COMPANY LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS (Expressed in U.S. Dollars) (Prepared by Management) (Unaudited)
	Three Months Ended November 30, 2021		Three Months Ended November 30, 2020

CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$	(391,141)	$	488,527
Items not involving an outlay of cash:
Depreciation and amortization		69,638		50,529
Stock-based compensation expense		39,386		-
Deferred income taxes		8,889		(40,784)

Changes in non-cash working capital items:
Decrease in accounts receivable		1,279,516		2,027,469
(Increase) in inventory		(2,832,562)		(223,013)
Decrease in prepaid expenses		38,479		196,255
Increase (decrease) in accounts payable and accrued liabilities		531,507		(454,861)
(Increase) in prepaid income taxes		(102,205)		-
Increase in income taxes payable		-		179,040

Net cash (used by) provided by operating activities		(1,358,493)		2,223,162

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment		(590,375)		(184,247)

Net cash used in investing activities		(590,375)		(184,247)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from bank indebtedness		2,000,000		-

Net cash provided by financing activities		2,000,000		-

Net increase in cash		51,132		2,038,915

Cash, beginning of period		1,184,313		3,801,037

Cash, end of period	$	1,235,445	$	5,839,952