SECOND QUARTER ENDED
Summary of second quarter operating results:
- Q2 2020 sales of
$7.2 million , a decrease of$1.9 million or 20.6% from Q2 2019 sales of$9.1 million - Profit for the period from continuing operations for Q2 2020 of
$671,000 , or$0.07 per share compared to profit from continuing operations of$386,000 , or$0.04 per share for Q2 2019 - Q2 2020 EBITDA of
$1.5 million , an increase of$0.4 million compared to Q2 2019 EBITDA of$1.1 million (see below for explanation and calculation of EBITDA) - Q2 2020 EBITDAaL of
$1.2 million , an increase of$0.4 million compared to EBITDAaL of$0.8 million for Q2 2019 (see below for explanation and calculation of EBITDAaL) - Working capital of
$7.8 million
Summary of year-to date operating results:
- Consolidated sales of
$14.4 million for the six months endedJune 30, 2020 , a decrease of 10.0% compared to sales of$15.9 million for the six months endedJune 30, 2019 - Profit for the period from operations for the six months ended
June 30, 2020 of$817,000 , being$0.08 per share compared to profit for the period from operations of$505,000 , or$0.05 per share for the same period in 2019 - EBITDA of
$2.1 million for the six months endedJune 30, 2020 compared to EBITDA of$1.7 million for the six months endedJune 30, 2019 (see below for explanation and calculation of EBITDA) - EBITDAaL of
$1.6 million for the six months endedJune 30, 2020 compared to EBITDAaL of$1.2 million for the six months endedJune 30, 2019 (see below for explanation and calculation of EBITDAaL)
EBITDA is earnings before interest, taxes, depreciation and amortization. EBITDAaL is earnings before interest, taxes, depreciation and amortization and is adjusted for cash lease payments and therefore comparative to pre-IFRS 16 EBIDTA. EBITDA and EBITDAaL are a non-IFRS financial measures and do not have any standardized meaning prescribed by International Financial Reporting Standards and, therefore, may not to be comparable to similar measures presented by other issuers. Management believes that EBITDA and EBITDAaL are useful supplemental measures, which provides an indication of the results generated by Circa's primary business activities prior to consideration of how those activities are financed, amortized or taxed. Readers are cautioned, however, that EBITDA and EBITDAaL should not be construed as an alternative to comprehensive income determined in accordance with IFRS as an indicator of the Company's financial performance. EBITDA and EBITDAaL are calculated by the Company as follows:
(unaudited) | (unaudited) | (unaudited) | (unaudited) | |
Profit for the period from operations | 817 | 505 | 671 | 386 |
Income taxes | 394 | 301 | 326 | 223 |
Interest | 65 | 87 | 33 | 53 |
Depreciation and amortization | 851 | 799 | 427 | 410 |
EBITDA | 2,127 | 1,692 | 1,457 | 1,072 |
Cash lease payments | (481) | (460) | (228) | (224) |
EBITDAaL | 1,646 | 1,232 | 1,229 | 848 |
Sales for the second quarter of 2020 were
Sales in the Telecom segment decreased
The Company posted after tax profit of
The Company took significant steps to reduce its spending in anticipation of lower activity from the impact of the COVID-19 pandemic on the economy. This included cutting discretionary spending, which resulted in lower selling, general and administrative expenses.
"In the early stages of the COVID-19 pandemic, there was considerable uncertainty in the business outlook, supply chain and forecast sales. Circa acted quickly with the formation of a special committee to monitor and respond to the developments. The Company has imposed a number of operational changes, cost reduction measures and took steps to ensure availability of products.
Aside from the operational challenges, the largest impact of COVID-19 pandemic on the business has been a reduction of orders in the Telecom segment from the contraction of the global economy. The Metals segment also experienced a sales decline early in the quarter from the shutdown of construction activity in
Management is expecting the Company's sales will improve through the second half of 2020 as businesses continue to reopen and the worldwide government lockdown measures are eased. The Company continues to closely monitor developments, government policy and is in contact with its customers and suppliers to ensure it can supply products and services when the economy recovers.
I would like to recognize the efforts of Circa's employees and contractors throughout this unusual period. The adaptability, dedication and commitment of our team in order to continue to operate the business has been greatly appreciated."
Condensed Interim Statement of Comprehensive Income
Unaudited | ||||
Six months | Six months | Three months | Three months | |
Sales | 14,351 | 15,940 | 7,236 | 9,111 |
Freight | 359 | 347 | 192 | 186 |
Net sales | 13,992 | 15,593 | 7,044 | 8,925 |
Cost of sales | 9,592 | 10,937 | 4,824 | 6,322 |
Gross profit | 4,400 | 4,656 | 2,220 | 2,603 |
Selling, general and administrative | 3,742 | 3,763 | 1,808 | 1,934 |
Operating profit | 658 | 893 | 412 | 669 |
Other income | 618 | - | 618 | (7) |
Finance costs | (65) | (87) | (33) | (53) |
Profit before tax | 1,211 | 806 | 997 | 609 |
Income tax expense | 394 | 301 | 326 | 223 |
Profit for the period from operations | 817 | 505 | 671 | 386 |
Other comprehensive loss | ||||
Exchange differences on translating | - | (103) | - | (18) |
Total comprehensive income for the | 817 | 402 | 671 | 368 |
Earnings per share (in $'s) | ||||
Basic and diluted | 0.08 | 0.05 | 0.07 | 0.04 |
GRANT OF STOCK OPTIONS
The Company announced today that it has granted a total of 275,000 stock options to directors, officers and employees of the Company pursuant to the Company's stock option plan. Of these stock options, 190,000 were granted to directors and officers of Circa. The stock options are exercisable for a period of five years at an exercise price per share equal to the closing price of the common shares of the
The Company's quarterly financial statements and related management's discussion and analysis have been filed with certain securities regulatory authorities in
SOURCE
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