Financial Results for First Half Announced

Earnings Up At Saputo Group Inc. As Company Goes Public And Expands Into US


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(Montréal, November 17, 1997) Saputo Group Inc. today presented its first interim report to shareholders and unveiled corporate financial results for the six months ended September 30, 1997.
 
Gross proceeds from the Companyʼs initial public offering of 9 470 500 common shares priced at $ 17 each totalled $ 161 000 000 of which $ 21 000 000 was used to pay down bank indebtedness upon exercise of the underwritersʼ over‑allotment or greenshoe option.  The offering was completed October 15, 1997.
 
Revenues for the second quarter, ended September 30, 1997, totalled $ 123.2 million, an increase of 8.1 % over revenues for the corresponding quarter of 1996.  Revenues for the first six months stood at $ 240.8 million, an advance of 9.0 % over the figure for the previous financial year.  The recent acquisition of a cheese distributor and importer, Fromages Caron Inc., and a fluid milk and ice cream company, Crémerie des Trois-Rivières Ltée, contributed handsomely to the notable increase in revenues.
 
Net earnings for the second quarter reached $ 10.9 million, up 6.5 % over the corresponding quarter of 1996. For the first six months of the year, the Company reported net earnings of $ 21.6 million, up 6.3 % over the corresponding period of the previous year.
 
Basic earnings per share for the second quarter rose from $ 0.34 to$ 0.37; figures for the first six months were $ 0.68 and $ 0.72 respectively.   Basic pro‑forma earnings per share for the second quarter rose increased from $ 0.26 ($ 0.26 fully diluted pro‑forma) to $ 0.28 ($ 0.27 fully diluted pro‑forma), whereas basic pro‑forma earnings per share rose for the first six months increased from $ 0.52 ($ 0.51 fully diluted pro‑forma) to $ 0.55 ($ 0.54 fully diluted pro‑forma).  Bank indebtedness decreased from $ 14.1 million to $ 3.1 million.
 
In the coming year, Saputo Group Inc. expects to sustain strong growth and profitability through ongoing internal development and further acquisitions, and has recently agreed to purchase Stella Foods Inc., a major US cheese producer, for US $ 405 million in a transaction to be finalized in December 1997. The company continues to explore additional market opportunities.

 
FINANCIAL HIGHLIGHTS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
 
 
Six Months Ended
 
 
 
 
 
Sept. 30
 
Sept. 30
 
%
 
Sept. 30
 
Sept. 30
 
%
 
(IN MILLIONS CDN $ EXCEPT FOR EARNINGS PER SHARE)
 
1997
 
 
 
1996
 
1997
 
1996
 
Change
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
123.2
 
113.9
 
8.1%
 
240.8
 
220.9
 
9.0%
 
EBITDA
 
19.4
 
18.5
 
4.9%
 
38.1
 
36.0
 
5.8%
 
Depreciation and Amortization of Fixed Assets
 
1.9
 
1.8
 
6.9%
 
3.9
 
3.7
 
4.7%
 
Amortization of Goodwill
 
0.1
 
0.1
 
-
 
0.2
 
0.2
 
-
 
Net Earnings
 
10.9
 
10.3
 
6.5%
 
21.6
 
20.4
 
6.3%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
EARNINGS PER SHARE
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic (1)
 
0.37
 
0.34
 
6.6%
 
0.72
 
0.68
 
6.3%
 
Basic Pro-Forma (2)
 
0.28
 
0.26
 
6.6%
 
0.55
 
0.52
 
6.3%
 
Fully Diluted Pro-Forma (3)
 
0.27
 
0.26
 
6.5%
 
0.54
 
0.51
 
6.3%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash from Operations
 
-
 
-
 
-
 
19.6
 
20.2
 
3.3%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BALANCE SHEET
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pro-Forma (4)
 
 
 
 
 
 
 
 
 
 
 
 
 
Sept. 30 1997
 
Sept. 30 1997
 
Sept. 30 1996
 
 
 
 
 
 
 
Working Capital
 
42.1
 
30.4
 
42.1
 
 
 
 
 
 
 
Long-term Debt
 
1.4
 
1.4
 
-
 
 
 
 
 
 
 
Shareholders' Equity
 
122.6
 
107.8
 
113.9
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Based on 30 000 000 shares.
 
(2) Based on 39 470 500 shares, which include 9 470 500 shares issued through the initial public offering on October 15, 1997.
 
(3) Based on 40 020 500 shares, which include 550 000 shares that may be issued through the share option purchase plan.
 
(4) The pro-forma takes into consideration the initial public offering of shares on October 15, 1997.

Information:           
Camillo Lisio
Executive Vice-President
(514) 328-3314