Adjusted Gross Profit in the six month period ended November 30, 2012 increased by $6.3 million, or 7%, to $100.7 million. Adjusted Gross Profit as a percentage of revenues increased slightly to 39.0% for the six month period ended November 30, 2012 compared to 38.9% in the six month period ended November 30, 2011. During the second quarter of Fiscal 2013, Adjusted Gross Profit increased by $5.5 million, or 16%, to $39.7 million and Adjusted Gross Profit as a percentage of revenues increased to 36.2% from 34.1%. The increase in Adjusted Gross Profit as a percentage of revenues for the quarter and first half of Fiscal 2013 was driven by higher margins on ice hockey equipment, the impact of the Cascade acquisition and favourable other cost of goods sold, partially offset by the impact of higher product costs and unfavourable foreign exchange.
Year-to-date Adjusted Net Income increased by $4.9 million, or 19%, to $30.2 million and second quarter Adjusted Net Income increased by $2.9 million, or 64%, to $7.3 million. The increase in Adjusted Net Income was driven by the increase in Adjusted Gross Profit, continued benefits of operating leverage in selling, general and administrative expenses, and a favourable impact from the Company's hedging activities.
Adjusted EPS increased 5%, or $0.04, to $0.84 for the six months ended November 30, 2012 compared to the same period last year and second quarter Adjusted EPS increased 43%, or $0.06, to $0.20. Fiscal 2013 Adjusted EPS includes an unfavourable impact from the higher number of common shares outstanding as a result of the share offering in June to fund the Cascade Acquisition making our Q1 and YTD Fiscal 2013 Adjusted EPS figures not directly comparable to the prior year. Excluding the impact of the Cascade Acquisition, YTD Adjusted EPS would have been approximately $0.88 or a 10% increase over the prior year. For the full fiscal year the Company currently expects the Cascade acquisition to be accretive to Adjusted EPS, however due to the seasonality of Cascade's business - a significant amount of Cascade's income is generated during the second and third fiscal quarters of the BAUER's fiscal year - the income from Cascade in the first fiscal half does not yet offset the dilutive impact of the higher number of common shares outstanding.
"BAUER continues to deliver strong results in hockey, lacrosse and our related apparel businesses," said Kevin Davis, President and Chief Executive Officer, Bauer Performance Sports. "Our newly launched hockey equipment products and our further investment into both apparel and lacrosse are key ingredients to our current and future success. We expect that these investments, combined with our comprehensive marketing strategy and recently launched brand building initiatives, will continue to fuel our exceptional performance. Like the millions of hockey fans around the world, we are excited that the National Hockey League is returning to action. Bauer Hockey maintains an important and valuable relationship with both the NHL and its players, and the recent agreement is welcome news for everyone involved."
The Company continued to deleverage as its leverage ratio, defined as net indebtedness divided by EBITDA, was 2.69 as of November 30, 2012 compared to 2.73 as of November 30, 2011. As of November 30, 2012, BAUER had working capital of $215.1 million compared to working capital of $179.6 million as of November 30, 2011, an increase of 20%. This increase was driven by the acquisitions of Cascade and Inaria, and sales growth of 18%, 4%, and 9% in the three most recent quarters (which include the entire "Back to Hockey" 2012 booking season).
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