Gendis Inc. Announces Third Quarter Results

Marketwired

WINNIPEG, MANITOBA--(Marketwire - Dec 10, 2012) - Gendis Inc. (GDS.TO) today announced its financial results for the 3rd quarter ended October 31, 2012 of the fiscal year ending January 31, 2013.

Revenue for the 3rd quarter was $1,431,000 compared to $1,419,000 for last year''s 3rd quarter. Net loss for the 3rd quarter was $791,000 ($0.06 per share) compared to a profit of $3,015,000 ($0.21 per share) for last year''s 3rd quarter.

Revenue year-to-date was $4,471,000 compared to $4,517,000 last year. Net loss year-to-date was $8,300,000 ($0.60 per share) compared to a loss of $671,000 ($0.05 per share) for last year.

Lease rental revenue increased marginally while investment income was essentially even quarter over quarter and year-to-date. The decrease in earnings is primarily due to the change in fair value for equity investments and investment properties quarter over quarter and year-to-date.

Condensed summarized information is as follows:

  quarter ended   year-to-date  
in millions of Canadian dollars Oct 31   Oct 31   Oct 31   Oct 31  
except per share 2012   2011   2012   2011  
Lease rental revenue   0.9     0.9     3.0     3.0  
Investment income   0.5     0.5     1.5     1.5  
Fair value change:                        
  Veresen   0.1     0.9     (4.4 )   2.8  
  OSUM   (1.0 )   0.5     (8.2 )   (8.5 )
  Other equity investments   0.1     (0.1 )   (0.9 )   (0.1 )
  Investment properties   (0.8 )   1.6     (0.1 )   1.8  
Expenses   (0.7 )   (0.9 )   (2.8 )   (2.9 )
Settlement of legal claims   -     -     1.5     -  
Income tax recovery (expense)   0.1     (0.4 )   2.1     1.7  
                         
Net earnings (loss)   (0.8 )   3.0     (8.3 )   (0.7 )
                         
Earnings (loss) per share $ (0.06 ) $ 0.21   $ (0.60 ) $ (0.05 )
                         
Fair value of investments:                        
  Veresen               25.8     28.8  
  OSUM               17.4     19.4  
  Other equity investments               1.8     0.1  
  Investment properties               27.9     26.9  
Other assets               0.7     0.7  
                         
Debt & payables               5.5     12.7  
Deferred tax payable               2.4     2.0  
                         
Shareholders'' equity               65.7     61.2  
     
  quarter ended year-to-date
in millions of Canadian dollars Oct 31 Oct 31 Oct 31 Oct 31
except per share 2012 2011 2012 2011
Cash flow from:        
  Operations        
    Cash receipts 1.6 1.9 4.7 4.7
    Cash disbursements (0.8) (1.1) (2.9) (3.0)
    Finance expense (0.1) (0.1) (0.3)
    Settlement of legal claims 1.5 (1.3)
    Income taxes 0.7 (0.1)
  Investing        
    Proceeds on sales of investments 0.1
    Purchase of investments (2.7)
    Expenditures on investment properties (0.5) (0.5)
  Financing        
    Debt advance (reduction) 0.1 (0.6) 0.3 0.4
    Purchase of share capital for cancellation (0.1) (0.1)
    Dividends (0.3) (0.3) (1.0) (0.3)
         
         
GENDIS INC.        
CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION      
(unaudited - thousands of Canadian dollars)   Oct 31 Oct 31 Jan 31
  note 2012 2011 2012
ASSETS        
Current assets        
  Cash   10 86 142
  Receivables   710 574 1,464
Total current assets   720 660 1,606
Non current assets        
  Equity investments 2 44,930 48,280 55,813
  Investment property   27,900 26,880 27,560
  Furnishings and equipment   39 49 52
Total non current assets   72,869 75,209 83,425
Total assets   73,589 75,869 85,031
         
LIABILITIES        
  Current liabilities        
  Credit facilities 3 3,897 11,395 3,600
  Payables   472 400 582
  Current income tax payable   154 - -
Total current liabilities   4,523 11,795 4,182
Non current liabilities        
  Post employment benefit obligation   951 855 961
  Deferred income tax payable   2,438 1,980 4,723
Total non current liabilities   3,389 2,835 5,684
Total liabilities   7,912 14,630 9,866
SHAREHOLDERS'' EQUITY   65,677 61,239 75,165
Total liabilities and shareholders'' equity   73,589 75,869 85,031
 
GENDIS INC.        
CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME       
FOR THE PERIODS ENDED OCTOBER 31        
(unaudited - thousands of Canadian dollars except for share data)  
    quarter     year-to-date  
  2012   2011   2012   2011  
Revenue                        
Lease rentals   931     912     2,959     2,990  
Dividends and other investment income   500     507     1,512     1,527  
  Total revenue   1,431     1,419     4,471     4,517  
Expense                        
  Property   370     396     1,413     1,456  
  Administration   301     348     1,206     1,140  
  Finance   30     104     134     289  
Total expense   701     848     2,753     2,885  
Fair value change                        
  Investment property   (851 )   1,602     (131 )   1,827  
  Equity investments   (807 )   1,233     (13,503 )   (5,869 )
Total fair value change   (1,658 )   2,835     (13,634 )   (4,042 )
Settlement of legal claims   -     -     1,483     -  
                         
Earnings (loss) before income tax   (928 )   3,406     (10,433 )   (2,410 )
Income tax (expense) recovery   137     (391 )   2,133     1,739  
Net earnings (loss) from operations and comprehensive income (loss)   (791   3,015     (8,30    (671 )
                         
Net earnings (loss) from operations per share $ (0.06 $ 0.21   $ (0.60 $ (0.05 
 
 
GENDIS INC.
CONDENSED INTERIM STATEMENT OF CHANGES IN SHAREHOLDERS'' EQUITY
 
  Share   Retained   Total  
(unaudited - thousands - shares & Capital   Earnings      
Canadian dollars as applicable) #   $   $   $  
Balance - January 31, 2011 13,937   14,650   47,608   62,258  
Comprehensive loss to July 31, 2011         (3,686 ) (3,686 )
Balance - July 31, 2011 13,937   14,650   43,922   58,572  
Comprehensive income for the                
quarter ended October 31, 2011         3,015   3,015  
Dividend paid         (348 ) (348 )
Balance - October 31, 2011 13,937   14,650   46,589   61,239  
Comprehensive income for the remainder of the year         17,759   17,759  
Dividends paid         (3,833 ) (3,833 )
Balance - January 31, 2012 13,937   14,650   60,515   75,165  
Comprehensive loss to July 31, 2012         (7,509 ) (7,509 )
Purchase of share capital for cancellation (6 ) (6 ) (13 ) (19
Dividends paid         (697 ) (697 )
Balance - July 31, 2012 13,931   14,644   52,296   66,940  
Comprehensive loss for the                
quarter ended October 31, 2012         (791 ) (791 )
Purchase of share capital for cancellation (40 ) (42 (82 ) (124
Dividend paid         (348 ) (348 )
Balance - October 31, 2012 13,891   14,602   51,075   65,677  
                 
GENDIS INC.                
CONDENSED INTERIM STATEMENT OF CASH FLOWS                
FOR THE PERIODS ENDED OCTOBER 31                
                 
  quarter   year-to-date  
(unaudited - thousands of Canadian dollars) 2012   2011   2012   2011  
Changes in cash position                
  By operations                
    Cash receipts 1,580   1,889   4,665   4,715  
    Cash disbursements (760 ) (1,042 ) (2,868 ) (3,067 )
Receipt (payment) on settlement of legal claims -   -   1,483   (1,250
    Income taxes (paid) recovered -   -   706   (74 )
    Finance expense paid (28 ) (102 ) (135 ) (290 )
  Total by operations 792   745   3,851   34  
  By investing activities                
    Proceeds from sale of equity investments -   -   118   -  
    Acquisition of equity investments -   -   (2,739 ) -  
    Expenditures on investment property (471 ) (8 ) (471 ) (33 )
    Proceeds on sale of equipment -   3   -   3  
    Expenditures on furnishings and equipment -   (9 ) -   (9 )
  Total by investing activities (471 ) (14 ) (3,092 ) (39 )
  By financing activities                
    Net advance (repayment) of credit facilities  103    (587 )  297    400  
    Purchase of share capital for cancellation (124)   -   (143 ) -  
    Dividends paid 348   (348 (1,045 (348
  Total by financing activities (369  (935 ) (891  52  
Increase (decrease) in cash (48 (204 ) (132 ) 47  
Cash - beginning of period 58   290   142   39  
Cash - end of period 10   86   10   86  

Gendis Inc.

Notes to the unaudited Condensed Interim Financial Statements

October 31, 2012

(All tabular amounts in thousands of Canadian dollars unless otherwise stated)

  1. General information
    General information on Gendis Inc. is the same as disclosed in Note 1 to the complete audited annual financial report for the year ended January 31, 2012.
    The principal accounting policies applied in the preparation of these condensed interim financial statements are the same as set out in Note 2 to the complete audited annual financial report for the year ended January 31, 2012. These policies have been consistently applied to all periods presented.

  2. Investments
              Oct 31 Jan 31
              2012 2012
 
Veresen             25,760 30,120
OSUM             17,405 25,595
Other equity investments             1,765 98
 
              44,930 55,813
                 
3. Credit facilities                
  Borrowing   Remaining borrowing   Carrying value
  Balance   availability   of collateral
  Oct 31 Jan 31   Oct 31 Jan 31   Oct 31 Jan 31
  2012 2012   2012 2012   2012 2012
Banker''s acceptances 3,497 3,000            
Bank demand loan 400 600            
  3,897 3,600   6,100 8,400   23,852 27,890
Broker''s margin account - -   1,177 1,115   2,673 2,328
 
  3,897 3,600   7,277 9,515   26,525 30,218
  1. Settlement of legal claims
    The Company reached a settlement with its insurer concerning the settlement of legal claims against the Company and some of its Directors by two suppliers and a buying agent and importer to a former subsidiary of the Company.

  2. Subsequent Event
    On December 10, 2012, the Company declared a regular dividend of 2.5¢ per share to shareholders of record December 21, 2012, payable January 4, 2013.

    During the period November 1, 2012 to December 10, 2012, the Company sold 105,000 shares of OSUM for net proceeds of $899,000.

    During the period November 1, 2012 to December 10, 2012, the Company purchased 1-million shares of Input Capital Corp., a private company, for $1-million.

Contact:
Gendis Inc.
James E. Cohen
President & Chief Executive Officer
(204)474-5200
(204)474-5201
finance@gendis.ca
www.gendis.ca

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