Total Leon's 3Q sales up 6.2%; same-store sales rise 1.5%
By Michael J. Knell -- Furniture Today, December 2, 2007
Toronto — Major Canadian furniture retailer Leon's saw third-quarter corporate sales rise 5.5% to C$165.8 million and earnings increase 8.7%, driven largely by new stores in Ontario and Saskatchewan. Same-store sales were up 1.5%.
Franchise sales in the quarter came to C$50.4 million, an increase of 8.5% over the comparable period last year, giving Leon's total sales of C$216.2 million, a gain of 6.2%.
Net income for corporate stores was C$16.2 million, or 22 Canadian cents per common share, versus C$14.9 million, or 20 cents per share, recorded in last year's third quarter.
In the nine months, total Leon's sales were C$586.5 million, an increase of 10.3% year-over-year, including franchise sales of C$134.9 million. Net earnings were C$36.9 million, or 50 Canadian cents per share, an increase of 12.1% over C$32.9 million, or 45 cents per share, in the comparable period last year.
"Although sales did not increase at the same pace as the first half of the year, overall we are pleased that we continued to improve our financial results in the third quarter," said President and CEO Terry Leon.
The full-line retailer opened a new showroom and warehouse in Longueil, Quebec, during the third quarter, and completed renovations at existing stores in Calgary, Alberta, and Kitchener, Ontario.
"We have purchased land for a new showroom and warehouse in Thunder Bay, Ontario, with construction anticipated to commence in the spring of 2008," Leon said, adding, "Land has also been secured in North Calgary for a new showroom and warehouse."
Leon's also said it is finalizing its purchase of Appliance Canada, which should close by the end of the year, giving it an entry into the sales of major home appliances to the building and apartment trade, and into high-end appliance sales to the public.
Appliance Canada has annual sales of about C$100 million.
At the end of the third quarter, Leon's had 35 corporate and 28 franchise stores across Canada.
| Leon's (a) | |||
|---|---|---|---|
| Earnings per share are fully diluted. | |||
| Quarter ended 9/30 | 2007 | 2006 | Change |
| (a) In Canadian dollars. (b) Includes pretax gains on the sale of capital property of C$443,000 in the 2006 quarter and C$2 million in the 2006 nine months. |
|||
| Sales | C$165,791,000 | C$157,132,000 | 5.5% |
| Operating income | 35,416,000 | 32,639,000 | 8.5% |
| Net income (b) | 16,174,000 | 14,886,000 | 8.7% |
| Earnings per share | 0.22 | 0.20 | 10.0% |
| 9 months ended 9/30 | 2007 | 2006 | Change |
| Sales | C$451,534,000 | C$411,178,000 | 9.8% |
| Operating income | 85,890,000 | 76,153,000 | 12.8% |
| Net income (b) | 36,884,000 | 32,890,000 | 12.1% |
| Earnings per share | 0.50 | 0.45 | 11.1% |
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