BMTC Group earnings climb 16.1% in 1Q
Revenues rise 8.5% to C$183.1 million
Michael Knell -- Furniture Today, May 10, 2010
MONTREAL — BMTC Group, the largest full-line furniture retailer in Quebec, reported a 16.1% gain in earnings in the first quarter as revenues rose 8.5% from the same period a year earlier to C$183.1 million.
Net earnings were C$3.6 million or 14 cents per share, up from C$3.1 million or 11 cents per share a year ago. The company also noted that its current share repurchase program contributed two cents per share to net earnings during the quarter.
Negatively impacting net earnings by 18 cents per share was the company's means of costing options offered to senior management. For the first quarter of 2009, the impact was four cents per share.
In discussing the results, BMTC chairman, President and CEO Yves Des Groseillers said the past two quarters of sales growth were driven primarily by "colossal government expenditures" used to stimulate the economy in the wake of the recession.
"2010 should see the company experience moderate growth," he told shareholders, cautioning that government-led economy stimulus plans are expected to end sometime this year, to be followed by the need to reduce and finance the fiscal deficits.
"This obligation will probably result in higher interest rates as well as higher direct and indirect taxation," Des Groseillers said.
This, in turn, could reduce the consumer's ability and willingness to buy big-ticket items such as furniture, mattresses and appliances.
However, he believes the company is well positioned to compete in such an environment because of its stable financial position.
"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," he told shareholders.
At the end of the first quarter, BMTC operated 33 stores under the Brault & Martineau and Ameublements Tanguay banners.
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BMTC earnings up 16.1% in quarter
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