BMTC sales advance 4.3% in second quarter
By Michael J. Knell -- Furniture Today, August 24, 2008
MONTREAL — BMTC Group, Quebec's dominant full-line furniture, mattress and appliance merchant, saw sales and earnings advance in the second quarter, despite what its senior management describes as a tightening retail marketplace.
Revenue of C$225.5 million was up 4.3% from the comparable period last year, while net earnings of C$17.1 million or 54 cents per share were up 14.8%.
For the first half, revenue of C$407.2 million was up 3.2% from the 2007 pace, while net earnings jumped 69.2%, to C$28.7 million or 92 cents per share.
However, the company said first-half earnings were positively influenced by 18 cents per share by its share option plan. If the company's average stock price declines over a given period, the effect is counted as revenue. If it increases, it becomes an expense.
In his report, BMTC chairman, President and CEO Yves Des Groseillers was guardedly optimistic about the second half.
“Consumer spending has been increasingly under pressure in recent months,” he said. “Exacerbating the situation is a tightening in credit markets for consumers as well as in the real estate market, both of which have direct effects on demands for the company's goods and services. Finally, economic indicators suggest that demand for non-essential durable goods orders is declining. Given all these factors, management is anticipating that it will be difficult to maintain sales in the quarters ahead.”
However, he said the company's strong financial position — it has no bank debt and has an untapped C$20 million line of credit — gives it competitive advantages.
“It permits the company to continue its aggressive marketing campaigns, allowing it to remain a leading participant in its market, while continuing to offer a superior financial performance,” Des Groseillers said.
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