EDMONTON, Alberta — The Brick Group Income Fund had its best-ever fourth quarter sales and earnings, but profit for the year was smashed by new federal tax rules that will affect Canadian income trusts beginning in 2011.

Sales for 2007’s final period came C$447 million, including sales of C$37.9 million at franchised stores, up 8.8% from the comparable period a year earlier. Net income of C$22.6 million or 42 cents per unit was up 55% from a year ago.

Fourth quarter EBITDA (earnings before interest, taxes, depreciation and amortization) was C$27.9 million, 23.9% higher than the C$22.5 million recorded for the same period last year. Brick officials believe EBITDA is the most accurate measure of the fund’s financial performance.

For the full year, sales totalled C$1.6 billion, including C$120 million in franchise sales, a 10.3% increase from Net earnings, however, were C$4.9 million or 9 cents per unit, an 86.8% plunge from the prior year.

The decline stemmed from a one-time charge of C$40.8 million related to future tax rules. Excluding this charge, net earning would have been C$45.9 million or 85 cents per trust unit.

For the year, EBITDA gained 18.7% to $80.7 million.
 
Same-store sales at corporate units were up 6.3% in the fourth quarter and 6.4% for the year.

“This was driven by a strong promotional calendar and more effective execution of delivering our written sales. This was our eighth consecutive quarter of positive same-store sales growth,” Brick Group President and CEO Kim Yost told analysts during a conference call.

The group added nine stores last year to give it a total of 210. It operates stores under four banners: The Brick, The Brick Mattress Store, The Brick Superstore and United Furniture Warehouse.

“We have driven down our cost structure, improved upon operating efficiencies, and increased our EBITDA. Our strong results for the year have validated our prior year strategic initiatives,” Yost said. “For the year ahead, we believe we are well positioned to succeed against the economic and competitive challenges and will continue to drive the benefits of our prior year key strategic initiatives, while growing our store and sales base of operations to the next level.”

The Brick Group also said it has secured commitments from its existing syndicate of lenders to refinance its operating credit facilities of $100 million for a three-year term.

Yost also announced that the group has retained the consulting firm of Spencer Stuart to search for the replacement for Mike Borys, who earlier announced his upcoming resignation as executive vice president and chief financial officer.