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New Look Vision Group Inc Reports Solid Results and the 20th Consecutive Quarter of Comparable Store Sales Growth

MONTRÉAL, Aug. 08, 2019 (GLOBE NEWSWIRE) -- New Look Vision Group Inc. ("New Look Vision" or the "Company") (BCI.TO), a leader in the Canadian retail optical industry with 380 stores across Canada, reported financial results today for the 13 and 26 week periods ended June 29, 2019 (“Q2 2019”). This press release should be read in conjunction with the Company’s management discussion and analysis (the “MD&A") and interim consolidated financial statements for the second quarter of 2019, which are available on the Company’s website at www.newlookvision.ca/investors and have been posted on SEDAR at www.sedar.com.

Q2 2019 Financial and Operational Highlights

  • Revenues increased by 1.0% over last year to $78.1 million.
  • Comparable store sales orders were up by 1.6% compared to the second quarter of last year, marking the 20th consecutive quarter of comparable store sales growth.
  • Total operating expenses as a percentage of revenues decreased by 3.4% to 80.4% for the second quarter compared to the same period last year.
  • Adjusted EBITDA reached $15.5 million, an increase of 1.6% over last year and increased 1.0% on a per diluted share basis to $0.99.
  • Net earnings attributable to shareholders reached $6.8 million, compared to $4.0 million last year, the increase being mainly attributable to higher EBITDA and lower depreciation expenses offset by higher incomes taxes. Net earnings on a per diluted share basis were $0.44, compared to $0.26 last year, an increase of 69.2%.
  • Adjusted net earnings attributed to shareholders were $7.4 million, compared to $6.7 million for the same quarter last year. Adjusted net earnings per diluted share were $0.47, an increase of 9.3% over the same quarter last year. The increase was driven by improved EBITDA and lower expenses.
  • Adjusted cash flows from operating activities were $14.8 million, an increase of 1.3% over last year and an increase of 2.2% on a per diluted share basis to $0.95.
  • The net debt to adjusted EBITDA ratio improved to 2.69, compared to 2.76 as of December 29, 2018.
  • The quarterly dividends to shareholders of $2.3 million, representing $0.15 per share, were distributed in the quarter.

Year-to-date Financial and Operating Results

  • Year-to-date revenues and adjusted EBITDA reached a record $149.5 million and $27.2 million respectively, which represent increases of 1.7% and 1.9% respectively over last year. Comparable store sales year-to-date were up 2.1% over last year.
  • Total operating expenses as a percentage of revenues decreased by 1.9% to 82.7% for the 26-week period compared to the same period last year.
  • Net earnings attributed to shareholders were $8.9 million or $0.57 per diluted share, compared to $6.2 million last year or $0.40 per diluted share.
  • Adjusted net earnings attributed to shareholders were $11.3 million, $0.3 million over last year. Adjusted net earnings attributed to shareholders increased to $0.72 per diluted share, up 1.4% from $0.71 in 2018.
  • Free cash flow reached $18.8 million, a 60.7% increase over last year, primarily due to higher cash flows from operations.
  • Adjusted cash flows from operating activities were $26.0 million or $1.66 per diluted share, an increase of $0.7 million, or 2.6% over last year.
  • The net debt to adjusted EBITDA ratio improved to 2.69, compared to 3.12 in the same period last year.

President & CEO's comments

Antoine Amiel, the President and CEO of New Look Vision, stated that: "New Look Vision has delivered a 20th consecutive quarter of comparable store sales growth in spite of very poor spring weather across Canada which dampened sales of sun wear, a staple of opticals' second quarters. The earnings and cash flow were strong nevertheless. We further delivered on our single store consolidation strategy, adding one store in Ontario and two in Atlantic Canada. Concurrently, we invested in Topology's business and technology which we believe will significantly differentiate our omnichannel model. New Look Vision continues to pursue both organic and external growth aggressively."

Dividend Approval

On August 8, 2019, the Board of Directors of New Look Vision declared a dividend of $0.15 per common share. The quarterly cash dividend will be paid on September 30, 2019 to the shareholders of record as of September 23, 2019. The dividend has been designated as an “eligible dividend”, that is a dividend entitling shareholders who are Canadian resident individuals to a higher dividend tax credit.

As of July 30, 2019, New Look Vision had 15,630,421 Class A common shares issued and outstanding.

Through the dividend reinvestment plan, shareholders residing in Canada may elect to re-invest their cash dividends into New Look Vision shares, without incurring brokerage commissions, fees and transaction costs. Until any further announcement, shares will be issued from treasury at 95% of the weighted average trading price for the five days preceding the dividend payment date. Any shareholder wishing to benefit from this opportunity may do so through his or her broker.

Attachments

  • Table A - Highlights
  • Table B - Consolidated statement of earnings
  • Table C - Reconciliation of net earnings to adjusted EBITDA and adjusted EBITDA attributed to shareholders
  • Table D - Reconciliation of net earnings to adjusted net earnings
  • Table E - Reconciliation of free cash flow and adjusted cash flows from operating activities

EBITDA, adjusted EBITDA, adjusted EBITDA attributed to shareholders, adjusted net earnings, free cash flow and adjusted cash flows from operating activities are not recognized measures under IFRS and may not be comparable to similar measures used by other entities.

About New Look Vision Group Inc.  New Look Vision is a leader in the eye care industry in Canada with a network of 380 stores operating mainly under the New Look Eyewear, Vogue Optical, Greiche & Scaff and Iris banners and laboratory facilities using state-of-the-art technologies. Tax information regarding payments to shareholders is available at www.newlookvision.ca in the Investors section.

All statements other than statements of historical fact contained in this press release are forward-looking statements, including, without limitation, statements regarding the future financial position, business strategy, projected costs and plans and objectives of, or involving New Look Vision. Readers can identify many of these statements by looking for words such as “believe”, “expects”,  “will”, “intends”, “projects”, “anticipates”, “estimates”, “plans”, “may”, “would” or similar words or the negative thereof. There can be no assurance that the plans, intentions or expectations upon which these forward-looking statements are based will be achieved. Forward-looking statements are subject to risks, uncertainties and assumptions. Although management of New Look Vision believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Some of the factors which could affect future results and could cause results to differ materially from those expressed in the forward-looking statements contained herein include: pending and proposed legislative or regulatory developments, competition from established competitors and new market entrants, technological change, interest rate fluctuations, general economic conditions, acceptance and demand for new products and services, and fluctuations in operating results, as well as other risks included in New Look Vision’s current Annual Information Form (AIF) which can be found at www.sedar.com. The forward-looking statements included in this press release are made as of the date hereof, and New Look Vision undertakes no obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise, except as provided by law.

For additional information please see our Web site www.newlookvision.ca. For enquiries, please contact Lise Melanson (514) 877-4119.

TABLE A
 
NEW LOOK VISION GROUP INC.
Highlights
for the periods ended June 29, 2019 and June 30, 2018
 
In thousands of Canadian dollars, except per share amounts
 
  13 weeks 26 weeks
  June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
Revenues $78,053   $77,244   $149,519   $147,021  
Variance % 1.0 %     1.7 %    
Variance in comparable store sales orders(a) 1.6 %     2.1 %    
Adjusted EBITDA(b) $15,547   $15,307   $27,152   $26,652  
Variance % 1.6 %     1.9 %    
% of revenues 19.9 % 19.8 % 18.2 % 18.1 %
Per share (diluted) $0.99   $0.98   $1.74   $1.71  
Variance % 1.0 %     1.8 %    
Adjusted EBITDA attributed to shareholders(b) $15,269   $15,267   $27,151   $26,738  
Variance % %     1.5 %    
% of revenues 19.6 % 19.8 % 18.2 % 18.2 %
Per share (diluted) $0.98   $0.98   $1.74   $1.71  
Variance % %     1.8 %    
Net earnings attributed to shareholders $6,820   $4,003   $8,890   $6,230  
Variance % 70.4 %     42.7 %    
% of revenues 8.7 % 5.2 % 5.9 % 4.2 %
Net earnings per share                
Per share (diluted) $0.44   $0.26   $0.57   $0.40  
Variance % 69.2 %     42.5 %    
Adjusted net earnings attributed to shareholders(b) $7,370   $6,735   $11,288   $11,022  
Variance % 9.4 %     2.4 %    
% of revenues 9.4 % 8.7 % 7.5 % 7.5 %
Per share (diluted) $0.47   $0.43   $0.72   $0.71  
Variance % 9.3 %     1.4 %    
Free cash flow(b)(c) $8,532   $6,979   $18,799   $11,698  
Variance % 22.3 %     60.7 %    
Per share (diluted) $0.55   $0.45   $1.20   $0.75  
Variance % 22.2 %     60.0 %    
Adjusted cash flows from operating activities(b)(d) $14,790   $14,593   $25,997   $25,329  
Variance % 1.3 %     2.6 %    
Per share (diluted) $0.95   $0.93   $1.66   $1.62  
Variance % 2.2 %     2.5 %    
Total debt         $154,486   $164,940  
Net debt(e) / Adjusted EBITDA attributed to shareholders(b)         2.69   3.12  
Cash dividend per share(f) $0.15   $0.15   $0.30   $0.30  
Number of stores(g)         378   376  
                 


a) Comparable stores are stores which have been operating for at least 12 months. Revenues are recognized at time of delivery of goods to customers, however management measures the comparable store performance on the basis of sales orders, whether delivered or not.
b) Adjusted EBITDA, adjusted EBITDA attributed to shareholders, adjusted net earnings attributed to shareholders, free cash flow and adjusted cash flows from operating activities are not recognized measures under IFRS and may not be comparable to similar measures used by other entities. Refer to the sections EBITDA and adjusted EBITDA, net earnings and adjusted net earnings, and operating activities for the definitions and reconciliations.
c) Free cash flow is defined as cash flows related to operating activities, less acquisitions of property, plant and equipment.
d) Adjusted cash flows from operating activities are defined as cash flows related to operating activities before income taxes paid, changes in working capital items, acquisition-related costs, and other non-comparable items.
e) Net debt is defined as total debt less cash. Adjusted EBITDA attributed to shareholders represents the amount over the last four rolling quarters.
f) The amounts of dividends shown in the table above refer to amounts declared in the periods.
g) The increase in the number of stores in the last twelve months reflects the acquisition of eight stores and six closures.
   



TABLE B
 
NEW LOOK VISION GROUP INC.
Consolidated Statement of Earnings
for the periods ended June 29, 2019 and June 30, 2018
 
In thousands of Canadian dollars, except per share amounts
 
  13  weeks 26 weeks
  June 29, 2019 June 30, 2018   June 29, 2019 June 30, 2018  
  $ $   $ $  
Revenues 78,053 77,244   149,519 147,021  
Materials consumed 17,094 17,428   32,746 32,420  
Employee remuneration expenses 26,056 25,605   50,829 50,321  
Other operating expenses 19,638 21,254   40,138 41,160  
Earnings before depreciation, amortization, loss on disposal, financial expenses, and income from investments in joint ventures and associates 15,265 12,957   25,806 23,120  
Depreciation, amortization and loss on disposal 4,444 5,285   8,864 10,663  
Financial expenses, net of interest revenue 2,297 2,280   5,535 4,085  
Earnings before income from investments in joint ventures and associates and income taxes 8,524 5,392   11,407 8,372  
Income from investments in joint ventures and associates 729 676   1,058 1,135  
Earnings before income taxes 9,253 6,068   12,465 9,507  
Income taxes        
Current 2,061 1,955   3,116 3,185  
Deferred 143 (34 ) 115 (123 )
Total income taxes 2,204 1,921   3,231 3,062  
Net earnings and comprehensive income 7,049 4,147   9,234 6,445  
Net earnings and comprehensive income attributed to:        
Non-controlling interest 229 144   344 215  
Shareholders of New Look Vision 6,820 4,003   8,890 6,230  
  7,049 4,147   9,234 6,445  
         
Net earnings per share        
Basic 0.44 0.26   0.57 0.40  
Diluted 0.44 0.26   0.57 0.40  
             


TABLE C
 
NEW LOOK VISION GROUP INC.
Reconciliation of Net Earnings to Adjusted EBITDA and Adjusted EBITDA Attributed to Shareholders
for the periods ended June 29, 2019 and June 30, 2018
 
In thousands of Canadian dollars, except per share amounts
 
  13  weeks 26 weeks
  June 29, 2019     June 30, 2018     June 29, 2019     June 30, 2018    
  $     $     $     $    
Net earnings 7,049     4,147     9,234     6,445    
Depreciation, amortization and loss on disposal 4,444     5,285     8,864     10,663    
Financial expenses, net of interest revenue 2,297     2,280     5,535     4,085    
Income taxes 2,204     1,921     3,231     3,062    
EBITDA 15,994     13,633     26,864     24,255    
Equity-based compensation(a) 277     440     483     646    
Net loss (gain) from changes in fair value of foreign exchange contracts 12     (1 )   12     (42 )  
Acquisition-related costs(b) 359     622     747     1,180    
Other non-comparable items(c) (1,095 )   613     (954 )   613    
Adjusted EBITDA 15,547     15,307     27,152     26,652    
Variance in $ 240           500          
Variance in % 1.6   %       1.9   %      
% of revenues 19.9   % 19.8   % 18.2   % 18.1   %
Per share (basic) 1.00     0.99     1.74     1.72    
Per share (diluted) 0.99     0.98     1.74     1.71    
                         

The following table represents the adjusted EBITDA available to New Look Vision shareholders, which takes into consideration the investments in joint ventures and associates.

  13  weeks 26 weeks
  June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
  $   $   $   $  
Adjusted EBITDA 15,547   15,307   27,152   26,652  
Income from investments in joint ventures and associates (729 ) (676 ) (1,058 ) (1,135 )
EBITDA from investments in joint ventures and associates 1,036   1,056   1,894   1,987  
EBITDA attributed to non-controlling interest (585 ) (420 ) (837 ) (766 )
Adjusted EBITDA attributed to shareholders 15,269   15,267   27,151   26,738  
                 


a) Equity-based compensation represents the fair value of New Look Vision stock options vested in the period.
b) Acquisition-related costs are mainly comprised of legal and other fees related to the business acquisitions, whether completed or in progress.
c) Other non-comparable items include one-time expenses (income) connected with personnel costs related to acquisition, restructuring and transition related matters.
   

EBITDA, adjusted EBITDA and adjusted EBITDA attributed to shareholders are not recognized measures under IFRS and may not be comparable to similar measures used by other entities. New Look Vision believes that EBITDA, adjusted EBITDA and adjusted EBITDA attributed to shareholders are useful financial metrics as they assist in determining the ability to generate cash from operations. Investors should be cautioned that EBITDA, adjusted EBITDA and adjusted EBITDA attributed to shareholders should not be considered as an alternative to net earnings or cash flows as determined under IFRS.

TABLE D
 
NEW LOOK VISION GROUP INC.
Reconciliation of Net Earnings to Adjusted Net Earnings
for the periods ended June 29, 2019 and June 30, 2018
 
In thousands of Canadian dollars, except per share amounts
 
  13  weeks 26 weeks
  June 29, 2019     June 30, 2018     June 29, 2019     June 30, 2018    
  $     $     $     $    
Net earnings attributed to shareholders 6,820     4,003     8,890     6,230    
Amortization of acquired intangibles 1,659     1,817     3,261     3,653    
Acquisition-related costs 359     622     747     1,180    
Equity-based compensation 277     440     483     646    
Other non-comparable items (1,095 )   613     (954 )   613    
Related income taxes (650 )   (760 )   (1,139 )   (1,300 )  
Adjusted net earnings attributed to shareholders 7,370     6,735     11,288     11,022    
Variance in $ 635       266      
Variance in % 9.4   %   2.4   %  
% of revenues 9.4   % 8.7   % 7.5   % 7.5   %
Per share amount        
Basic 0.47     0.43     0.72     0.71    
Diluted 0.47     0.43     0.72     0.71    
                         

Adjusted net earnings attributed to shareholders are not a recognized measure under IFRS and may not be comparable to similar measures used by other entities. New Look Vision believes that this disclosure provides useful information as it allows the comparison of net results excluding amortization of acquired intangibles, acquisition-related costs, equity-based compensation, and other non-comparable items which may vary significantly from quarter to quarter. Investors should be cautioned that adjusted net earnings should not be considered as an alternative to net earnings as determined under IFRS.

TABLE E
 
NEW LOOK VISION GROUP INC.
Reconciliation of Free Cash Flow and Adjusted Cash Flows from Operating Activities
for the periods ended June 29, 2019 and June 30, 2018
 
In thousands of Canadian dollars, except per share amounts
 
  13  weeks 26 weeks
  June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
  $   $   $   $  
Earnings before income taxes 9,253   6,068   12,465   9,507  
Adjustments:        
Depreciation, amortization and loss on disposal 4,444   5,285   8,864   10,663  
Amortization of deferred lease inducements and variation of deferred rent (42 ) (39 ) (84 ) (89 )
Equity-based compensation expense 277   440   483   646  
Financial expenses 2,380   2,350   5,696   4,225  
Interest revenue (83 ) (70 ) (161 ) (140 )
Other 26     (1 ) (141 )
  Income from investments in joint ventures and associates (729 ) (676 ) (1,058 ) (1,135 )
Income taxes paid (1,066 ) (1,294 ) (2,745 ) (4,125 )
Cash flows related to operating activities, before changes in working capital items 14,460   12,064   23,459   19,411  
Changes in working capital items (4,211 ) (2,920 ) (667 ) (1,513 )
Cash flows related to operating activities 10,249   9,144   22,792   17,898  
                 

Free cash flow

  13  weeks 26 weeks
  June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
  $   $   $   $  
Cash flows related to operating activities 10,249   9,144   22,792   17,898  
Acquisitions of property, plant and equipment (1,717 ) (2,165 ) (3,993 ) (6,200 )
Free cash flow 8,532   6,979   18,799   11,698  
                 

Free cash flow is not a recognized measure under IFRS and may not be comparable to similar measures used by other entities. New Look Vision believes that this disclosure provides useful information as it provides insight on operating cash flows available after considering necessary capital investments. Investors should be cautioned that free cash flow should not be considered as an alternative to cash flows related to operating activities as determined under IFRS.

Adjusted cash flows from operating activities

  13  weeks 26 weeks
  June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
  $   $   $   $  
Cash flows related to operating activities 10,249   9,144   22,792   17,898  
Income taxes paid 1,066   1,294   2,745   4,125  
Changes in working capital items 4,211   2,920   667   1,513  
Acquisition-related costs 359   622   747   1,180  
Other non-comparable items (1,095 ) 613   (954 ) 613  
Adjusted cash flows from operating activities 14,790   14,593   25,997   25,329  
                 

Adjusted cash flows from operating activities are not a recognized measure under IFRS and may not be comparable to similar measures used by other entities. New Look Vision believes that this disclosure provides useful information as it allows the comparison of net operating cash flows excluding acquisition-related costs and other non-comparable items, which may vary significantly from quarter to quarter. Investors should be cautioned that adjusted cash flows from operating activities should not be considered as an alternative to cash flows related to operating activities as determined under IFRS.