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TSX Symbol: SQP
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For Immediate Release
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Strongco Reports Second Quarter Profit of $0.35 per Share and Implementation
of Quarterly Dividend of $0.05 per Share
Mississauga,
Ontario –
July 30th, 2004: Strongco Inc. today released its results for the
second quarter of 2004.
For the three months ended June 30th, 2004 Strongco generated net income
after tax of $3.3 million, ($0.35 per share), during the second quarter vs.
$2.3 million, ($0.24 per share), for the comparable quarter 2003. On a
diluted basis the net income per share was $0.34 vs. $0.24 last year.
For the six months ended June 30th, 2004 net income after tax was $3.2
million, ($0.34 per share), vs. $1.7 million, ($0.18 per share), for the
comparable period of 2003. On a diluted basis the net income per share was
$0.33 vs. $0.18 last year.
Strongco is implementing a quarterly dividend of $0.05 per share payable
September 20, 2004 to shareholders of record at the close of business on
August 31, 2004.
Larry Pirnak, President and CEO, announced his
intention to retire July 31, 2005. In conjunction with this announcement
Mr. Robin MacLean was promoted to Senior Vice President- Operations.
Mr. Larry Pirnak, President, commented, “We
are pleased with the results and anticipate continued improvement for the
balance of 2004.”
Strongco will host a conference call at 2:00 p.m. on Friday July 30th,
to further discuss its second quarter. To participate in the conference
call, dial 800.633.8615, reservation number is 21201917. A taped version of
the call will be available until August 13th, 2004. Dial 800.558.5253 and
enter the reservation number.
Strongco is a full-line equipment sales and service company. Its shares
are listed on the Toronto Stock Exchange and its website can be accessed at
www.strongco.com
For further information contact:
Len Phillips,
Vice President Administration
and Corporate Secretary
Telephone No.: 905.565.3840
Email: lphillips@strongco.com
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CONSOLIDATED
BALANCE SHEETS
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As at
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As at
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As at
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June 30
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June 30
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December 31
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[unaudited - in thousands of dollars]
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$
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2004
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$
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2003
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$
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2003
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ASSETS
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Current
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Accounts receivable
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31,682
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38,576
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31,040
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Inventories
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88,575
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113,641
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87,295
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Prepaid expenses and deposits
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2,272
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1,083
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1,797
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Income and other taxes receivable
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—
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302
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—
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Total current assets
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122,529
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153,602
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120,132
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Rental equipment, net
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14,362
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20,967
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17,425
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Capital assets, net
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17,142
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18,606
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17,548
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Capital assets held for sale, net
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—
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4,257
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3,980
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Accrued benefit asset
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3,934
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2,625
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3,314
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157,967
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200,057
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162,399
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LIABILITIES AND SHAREHOLDERS' EQUITY
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Current
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Bank indebtedness
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14,184
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28,160
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21,465
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Accounts payable and accrued liabilities
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29,504
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37,240
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25,312
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Equipment notes payable
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54,288
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76,467
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57,540
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Current portion of long-term debt
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3,481
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7,450
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4,663
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Income and other taxes payable
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56
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—
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424
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Total current liabilities
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101,513
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149,317
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109,404
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Long-term debt
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694
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3,826
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1,720
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Future income taxes
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1,410
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72
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229
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Accrued benefit liability
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1,382
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411
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1,295
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Total liabilities
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104,999
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153,626
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112,648
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Shareholders' equity
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Share capital [note 2]
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52,143
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52,100
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52,131
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Contributed surplus [note 2]
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15
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—
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—
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Retained Earnings / (deficit)
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810
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(5,669)
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(2,380)
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Total shareholders' equity
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52,968
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46,431
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49,751
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157,967
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200,057
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162,399
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CONSOLIDATED STATEMENTS OF INCOME
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AND RETAINED EARNINGS
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Three months
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Six months
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ended June
30
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ended June
30
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[unaudited - in thousands of
dollars, except per share amounts]
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$
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2004
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$
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2003
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$
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2004
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$
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2003
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Revenue
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94,858
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93,135
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160,139
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165,338
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Cost of sales
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77,340
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77,243
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129,197
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136,081
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Gross margin
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17,518
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15,892
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30,942
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29,257
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Expenses
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Administration, distribution and selling
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12,800
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12,555
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25,528
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25,030
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Income before the following
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4,718
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3,337
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5,414
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4,227
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Interest
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742
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1,247
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1,611
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2,550
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Income before income taxes
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3,976
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2,090
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3,803
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1,677
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Provision for (recovery) of income taxes
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668
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(167)
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613
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(55)
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Net income
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3,308
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2,257
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3,190
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1,732
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Deficit, beginning of period
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(2,498)
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(7,926)
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(2,380)
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(7,401)
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Retained earnings (deficit), end of period
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810
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(5,669)
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810
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(5,669)
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Basic earnings per share
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Earnings per share
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0.35
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0.24
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0.34
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0.18
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Weighted average number of shares
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9,417,385
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9,387,802
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9,415,606
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9,386,135
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Diluted earnings per share
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Earnings per share
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0.34
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0.24
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0.33
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0.18
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Weighted average number of shares
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9,597,908
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9,499,292
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9,581,269
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9,386,135
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See accompanying notes
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CONSOLIDATED
STATEMENTS OF CASH FLOWS
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Three months
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Six months
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ended June 30
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ended June 30
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[unaudited - in thousands of dollars]
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$
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2004
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$
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2003
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$
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2004
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$
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2003
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OPERATING ACTIVITIES
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Net Income
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3,308
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2,257
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3,190
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1,732
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Add (deduct) items not involving a current outlay (inflow) of cash
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