Farnham, Quebec, July 24--Domco Tarkett Inc. announces its results for the second quarter ended June 28, 2003. It should be noted that the financial statements have been presented in U.S. dollars since January 1, 2003.
For comparative purposes, results for the second quarter and first half of 2002, as well as the balance sheet as at December 31, 2002, are also presented in U.S. dollars.
For the second quarter of 2003, Domco Tarkett Inc. achieved consolidated net sales of $108.4 million, compared with $115.3 million for the corresponding period of 2002.
Sales of residential resilient flooring declined from $39.1 million to $34.8 million, while sales of commercial resilient flooring totalled $40.6 million, compared with $43.6 million last year.
Sales of hardwood flooring rose to $33.0 million from $32.5 million for the same period in 2002. The Hardwood Division accounted for 30.4% of consolidated net sales, compared with 28.2% in the second quarter of 2002.
Earnings before interest, income taxes, depreciation and amortization (EBITDA) amounted to $5.2 million, compared with $9.5 million in the second quarter of 2002. Administrative, distribution and selling expenses were reduced by $1.2 million to $22.6 million, or 20.9% of consolidated sales, versus $23.8 million or 20.6% of consolidated sales in the second quarter of 2002. The corporation posted net earnings of $1.3 million or $0.06 per share, compared with $3.5 million or $0.13 per share for the second quarter of 2002.
Three major factors accounted for the decline in second-quarter results from the same period in 2002: the weak vinyl flooring market resulting in lower volumes and pressure on selling prices, the higher prices of raw materials, in particular in the hardwood and the negative impact of the Canada-U.S. exchange rate.
For the first six months of 2003, Domco Tarkett Inc. achieved consolidated net sales of $210.3 million, compared with $215.8 million for the first half of 2002. Sales of residential resilient flooring went from $74.2 million to $69.3 million, while sales of commercial resilient flooring totalled $76.3 million, versus $80.8 million for the first six months of 2002. Sales of hardwood flooring rose to $64.7 million from $60.8 million for the same period in 2002.
Earnings before interest, income taxes, depreciation and amortization (EBITDA) amounted to $10.9 million, compared with $16.0 million for the same period in 2002. Administrative, distribution and selling expenses were lowered by $2.2 million to $44.8 million. The corporation recorded net earnings of $2.7 million or $0.11 per share, as opposed to $4.9 million or $0.19 per share for the first half of 2002.
Operating activities provided cash flows of $15.8 million in the second quarter of 2003, up from $10.1 million in 2002. Operating cash flows for the first six months amounted to $5.5 million, compared with $4.0 million for the same period in 2002.
Capital expenditures amounted to $2.3 million in the second quarter of 2003, compared with $2.7 million in the second quarter of 2002. They totalled $3.1 million for the first six months of 2003, as opposed to $4.5 million for the first half of 2002.
The net increase in cash and cash equivalents rose to $6.7 million in the second quarter, up from $3.9 million in the corresponding period of 2002. Cash flows generated for the first six months of 2003 totalled $0.8 million, compared with a decrease of $17.5 million for the first half of 2002. This difference is mainly due to large repayments of the long-term debt in 2002.
Shareholders' equity totalled $171.8 million, up from $162.5 million on the same date in 2002. The corporation had a total net indebtedness to equity ratio of 0.25:1 as at June 28, 2003, compared with 0.25:1 as at December 31, 2002 and 0.32:1 as at June 29, 2002.
