Bestar sees uptick in sales in third quarter
By Michael J. Knell -- Furniture Today, December 10, 2007
Lac-Megantic, Quebec — Driven by its move into the component business, ready-to-assemble furniture specialist Bestar is seeing an uptick in sales and an improvement in earnings.
Third quarter revenue of C$10.6 million was up 27.3% from the comparable period last year. Net earnings were C$21,000 or zero cents per share, compared with a net loss of C$498,000 or 4 cents per share in the 2006 third quarter.
Revenue for this year's first nine months came to C$32.9 million, up 40.2%. Net earnings were C$200,000 or 2 cents per share, compared with last year's net loss of C$1.1 million or 8 cents per share.
"As stated in the press releases from previous quarters, this increase is due mostly to the success of our diversification into the components market as well as the success of new furniture collections in our traditional market," Bestar President and CEO Paulin Tardif said in a statement.
He said that like other Canadian furniture manufacturers, Bester has been hurt by the rising value of the Canadian dollar. However, this was offset during the third quarter by an increase in the value of certain Bestar investments in derivative financial instruments.
The move into the component business, launched in 2006, and increases in productivity at Bestar's plant here are also beginning to pay off, Tardif said.
Meanwhile, the company also said it has signed a new collective agreement with its union employees through 2010.
"Many changes were brought to this new agreement, enabling more flexibility which will help to increase productivity," Tardif said, adding the company also is studying how best to modernize certain production equipment in its plant.
"This investment would permit us to reduce production costs and increase our competitiveness. We hope to confirm the implementation of this project within the next few weeks," he said.
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