BMTC 1Q sales slip 2.5%, but earnings rise
By Michael J. Knell -- Furniture Today, May 21, 2007
Montreal — BMTC Group reported a dip in sales but said its earnings improved tenfold in the first quarter as investment income grew.
The retailer's revenues of C$178.4 million were down 2.5% from the same period in 2006. Net earnings of C$2 million were up from C$285,000 a year earlier.
Yves Des Grosseillers, BMTC's chairman, president and CEO, said written sales rose by C$6.8 million or 3.4% during the first quarter. He said revenues were down because of the backlog of undelivered sales at the close of the quarter.
During the quarter, the company opened its 12th Brault & Martineau Sleep Gallery, a 6,000-square-foot unit in the Montreal suburb of St-Jean-sur-le-Richelieu. It also sold its liquidation center in Longueuil, resulting in a pretax gain of C$1.2 million.
In a statement, Des Grosseillers said the company has an increasing number of competitors and is facing a deflationary trend in the pricing of its products.
Last year, The Brick entered the Quebec market and now has eight stores in and around Montreal. Sleep Country Canada acquired Quebec bedding specialist Dormez-vous and is expanding it aggressively.
Both compete with Brault & Martineau, BMTC's Montreal-based banner.
"Management believes growth rates will continue to decline in the years to come due to a maturing economic cycle characterized by intense competition, further concentrating market share amongst a fewer large companies," Des Grosseillers said. "The challenge in the years to come will be to pursue market share more aggressively and efficiently, so as to come out in a stronger position in the end."
At the end of the first quarter, BMTC operated 29 Brault & Martineau, Brault & Martineau Sleep Gallery and Ameublesment Tanguay stores.
| BMTC Group (a) | |||
|---|---|---|---|
| Owns Ameublements Tanguay and Brault & Martineau | |||
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 3/31 | 2007 | 2006 | Change |
| (a) In Canadian dollars | |||
| Revenues | $178,452,000 | $182,969,000 | (2.5%) |
| Operating income | 2,887,000 | 1,165,000 | 147.8% |
| Net income | 2,055,000 | 285,000 | 621.1% |
| Earnings per share | 0.06 | 0.01 | 500.0% |
