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Canlan Reports Q2 Results and Continuation of Dividend Policy

20:00 EDT 12 Aug 2015 | Globe Newswire

BURNABY, British Columbia, Aug. 13, 2015 (GLOBE NEWSWIRE) -- Canlan Ice Sports Corp. (the "Corporation") (TSX:ICE) today reported its financial results for the second quarter ended June 30, 2015.

Highlights of Q2 2015

  • Total revenue of $17.5 million (a record high for Q2 since Canlan began focusing on recreation in 1998) increased by $1.0 million or 6.0% over 2014; same store revenue increased by $0.7 million or 4.3%;
     
  • Revenue of $0.3 million from the new Lake Barrington Sportsplex was on target and good progress continued to be made in building new relationships with the community; and
     
  • A new director, Mr. Doug Brownridge, was elected to the Board in June 2015. Mr. Brownridge has held senior marketing and business development positions, and directorships in various organizations.
Second Quarter and Six Months Ended June 30, 2015 Results
     
  For the 3 months ended
June 30, 2015
For the 6 months ended
June 30, 2015
(in thousands) 2015 2014 2015 2014
Revenue $17,476 $16,480 $40,051 $37,678
Operating expense 16,351 15,174 32,252 29,748
  1,125 1,306 7,799 7,930
G&A expense 1,113 1,084 2,368 2,265
EBITDA1 $12 $222 $5,431 $5,665
EBITDA per share $ - $0.02 $0.41 $0.43
Net earnings (loss) $(1,776) $(1,434) $(258) $1,024
Net earnings (loss) per share $(0.13) $(0.11) $(0.02) $0.08
         
                                                                               
1 Earnings before interest, taxes, depreciation and amortization (EBITDA) is often used as a measure of financial performance. However, EBITDA is not a term that has specific meaning in accordance with IFRS, and may be calculated differently by other companies.
 
Key Balance Sheet Figures (in thousands):    
  June 30, 2015 December 31, 2014
Assets    
Cash and cash equivalents $5,908 $13,534
Property plant and equipment 104,119 97,682
Investment properties 570 570
Other assets 5,738 6,236
Total assets $116,335 $118,022
Liabilities and Equity    
Interest bearing debt $57,243 $53,582
Accounts payable and accrued liabilities 7,299 7,351
Deferred revenue 6,862 11,333
Other liabilities 938 971
Total liabilities 72,342 73,237
Total shareholders' equity 43,993 44,785
Total liabilities and equity $116,335 $118,022

Second Quarter Results

(three months ended June 30, 2015 compared with three months ended June 30, 2014)

  • Q2 revenue of $17.5 million increased by 6.0% over 2014; same store revenue increased by 4.3%;
     
  • Incremental sales from Canlan's Adult Safe Hockey League (ASHL), contract ice rentals, and soccer leagues from various markets were the main sources of same store revenue growth;
     
  • Tournament operations revenue of $1.6 million increased by 11.0% from the prior year mainly due to an increase in the number of tournaments and overall registrations; and
     
  • Quarterly EBITDA broke even in 2015 compared to $0.2 million in the prior year.

"While overall revenue from operations trended upward from the same quarter of 2014, we experienced the effect of the seasonality of the industry in various markets where registrations in our core leagues and programs were a bit softer than anticipated," said Canlan's CEO, Joey St-Aubin. "For Q3 and into Q4, we will continue to focus on increasing summer camp activity, filling our fall/winter ASHL league, and growing our Sportsplex businesses."

"In addition to the seasonal trends, Ontario's operating cost structure was significantly affected by the continued increase in electricity surcharges imposed by Provincial utility companies," said Canlan's CFO, Mike Gellard. "We will continue to prudently manage energy consumption in all our facilities and increase efficiencies by improving our equipment where possible."

Six Months Ended June 30, 2015 Results

(six months ended June 30, 2015 compared with six months ended June 30, 2014)

  • Revenue of $40.1 million increased by $2.4 million or 6.3% compared to the prior year. Same store revenue increased by $1.5 million or 4.0 %; 
     
  • ASHL, contract ice rentals, youth hockey leagues and soccer leagues were the main sources of revenue growth. Additional revenue from turf and sport court rentals and soccer league was also contributed by our new sportsplex in Lake Barrington;
     
  • EBITDA of $5.4 million decreased by $0.2 million or 4.1% from the prior year as labour costs increased, and utility surcharges imposed by Ontario hydro authorities were significantly higher; and
     
  • After recording depreciation of $3.4 million, and income tax expense of $0.2 million, net loss for the period was $0.3 million ($0.02 loss per share) compared to a net income of $1.0 million ($0.08 earnings per share) a year ago.

Dividend Policy

Canlan's Board of Directors has approved the continuation of the Company's quarterly dividend policy and declared eligible dividends totaling $0.02 per common share that will next be paid on October 15, 2015 to shareholders of record at the close of business September 30, 2015. Canlan's Board of Directors reviews the Company's dividend policy on a quarterly basis. Canlan's dividend is designated as an "eligible" dividend under the Income Tax Act (Canada) and any corresponding provincial legislation. Under this legislation, individuals resident in Canada may be entitled to enhanced dividend tax credits, which reduce income tax otherwise payable.

"Since purchasing the Sportsplex in Lake Barrington, Illinois, we've completed physical improvements to the facility, established good relations and exposure with the local market, and started new sports leagues in the facility such as lacrosse and 7 on 7 Football," said Mr. St-Aubin. "The Sportsplex business continues to be an exciting one for Canlan and our goal in the coming months will be to leverage the versatile facilities we have and capture a greater share of the recreation market."

"During the upcoming summer months, we will complete a number of planned capital and maintenance projects to improve amenities at various facilities," said Mr. Gellard. "We anticipate these projects will complete on budget and on time to nicely position ourselves for the busy fall/winter season."

Canlan's financial statements and Management Discussion & Analysis for the period ended June 30, 2015 will be available via SEDAR on or before August 14, 2015 and through the Company's website, www.icesports.com.

About Canlan

Canlan Ice Sports Corp. is the North American leader in the development, operations and ownership of ice rink and multi-purpose recreation facilities. We are the largest private sector owner and operator of recreational ice sports facilities in North America and currently own and/or manage 20 facilities in Canada and the United States with 55 ice surfaces, as well as indoor soccer fields, sport courts, volleyball, and basketball courts. To learn more about Canlan please visit www.icesports.com.

Canlan Ice Sports Corp. is listed on the Toronto Stock Exchange under the symbol "ICE."

Caution concerning forward-looking statements

Certain statements in this MD&A may constitute ''forward looking'' statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. When used in this MD&A, such statements may use such words as ''may'', ''will'', ''expect'', ''believe'', ''plan'' and other similar terminology. These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this MD&A. These forward looking statements involve a number of risks and uncertainties. Some of the factors that could cause actual results to differ materially from those expressed in or underlying such forward looking statements are the effects of, as well as changes in: international, national and local business and economic conditions; political or economic instability in the Company's markets; competition; legislation and governmental regulation; and accounting policies and practices. The foregoing list of factors is not exhaustive.

CONTACT: Canlan Ice Sports Corp.
         Michael F. Gellard
         Senior Vice President & CFO
         604-736-9152

Canlan Ice Sports Corp. logo

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